The Federal Government is actively chasing a free trade agreement (FTA) with the European Union.

Trade Minister Steven Ciobo says steps are being taken, including a scoping study to outline the boundaries for future talks.

“The EU is our second-largest trading partner, it's worth roughly $95.6 billion and putting this FTA in place will be crucial driver of the Australian economy into the future, and of generating more jobs in Australia,” he told reporters.

Mr Ciobo will now ask Cabinet for permission to launch formal negotiations for the FTA.

“The Europeans of course need to do the same thing through their system, and their system can sometimes take a little longer than the Australian system, and that's understandable given the number of countries involved,” he said.

“But I'm very confident that we've got a great starting point for comprehensive negotiations.” 

Mr Ciobo says there is great potential to benefit the Australian economy, but is non-specific on which industry stood to make the most.

“One example I often make reference to is the fact that Australia imports more agricultural products from Europe — us with a population of 23 or 24 million — than the Europeans do from Australia with their population,” Mr Ciobo said.

The Federal Opposition is on board, saying the scoping study was long overdue.

“It's good, it's about time, but like a lot of things that the Government's doing in trade, it's way behind schedule,” Labor's trade spokesperson Jason Clare said.

“They promised that they'd be negotiating this deal with Europe by now and they still haven't started.”

Mr Ciobo denied the claim.

“Well we're perfectly on schedule, the fact is we've got this scoping study in place, and I don't take much trade advice from the Australian Labor Party,” he said.

“They don't know if they want bilaterals or multilaterals and frankly they didn't start and conclude any FTAs when they were last in government.”