MEXICO CITY (Kyodo) Mexican Economy Secretary Fernando Canales said Wednesday that Japan had made large concessions in talks on a free-trade agreement with his country.

"No other countries have won such preferential tariff treatment from Japan," local media quoted Canales as saying.

Mexico plans to sign an FTA with Japan within two months. It will be put into effect in January, following Diet approval, he was quoted as saying.

The Ministry of Economy, Trade and Industry said Mexico anticipates that the FTA will provide a significant boost for exports and employment.

"With the agreement, the Mexican exports to Japan will increase by an average 10.6 percent annually," while 410,000 new jobs will be created over the next 10 years, the ministry said in a statement.

The employment situation will improve because the increased exports will fuel investment in production facilities, while direct investment from Japan will also grow under the FTA, it said.

Mexico's exports to Japan reached $1.773 billion in 2003.

Japan and Mexico are in the final stages of negotiations over the pact, following 1 1/2 years of sometimes bitter negotiations. The two sides reached a broad agreement Wednesday on a package that includes the industrial and farm sectors, paving the way for the deal to be sealed by the end of this month.