The European Union and Japan signed a free trade agreement that reduces tariffs on most goods. The agreement covers 600 million people and a two-third of the economy. The deal will remove tariffs on European exports such as cheese and wine, reported CNN Money.

President of the European Council, Donald Tusk said the agreement is the “largest bilateral trade deal ever.” In a written statement, he added: “Relations between the European Union and Japan have never been stronger.”

“Geographically, we are far apart. But politically and economically we could hardly be any closer.”

At present, the EU products are subject to an average tariff of 1.6% when they come into Japan, and the Japanese products are imposed tariffs of 2.9% in the European Union, observed the World Trade Organisation. 

In reference to the deal, Baker McKenzie partner Ross Denton said: it is “a very strong signal to the US Administration that the EU and Japan, two major trade partners of the US, both see the benefits of removing barriers and reducing, not increasing tariffs.”