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BANDAR SERI BEGAWAN (Kyodo) Japan and the Association of Southeast Asian Nations aim to sign a free-trade deal in November after trade ministers from the two sides managed to overcome a major impediment that had bogged down their talks for months, Japanese and ASEAN ministers and officials said Friday.

The two sides reached an agreement in principle on the modalities of their free-trade talks, the sources said after they finished a meeting in the Brunei capital on the sidelines of an informal meeting of ASEAN economic ministers.

The problem of modalities in Japan-ASEAN FTA efforts refers to issues such as what percent of goods traded should be tariff-free. Japan has proposed 92 percent of goods traded between Japan and ASEAN to be tariff-free. But it wants 7 percent of goods categorized as sensitive or highly sensitive to have some degree of protection, and wants 1 percent of goods to be excluded completely from liberalization.

Auto parts and steel are expected to be liberalized, but rice is expected to be protected.

Participants in the Brunei talks Friday said they are hopeful Japan and the 10-member grouping will be able to wrap up their negotiations by the end of August and their leaders will be able to sign the proposed Comprehensive Economic Partnership Agreement in November on the sidelines of the annual ASEAN summit that will be held in Singapore. It would mark Japan’s first FTA with a regional bloc.

Economy, Trade and Industry Minister Akira Amari told Japanese reporters when he emerged from the meeting that the their negotiations are expected to conclude by the end of August — when ASEAN economic ministers hold their annual meeting in Manila.

“Japan and ASEAN successfully reached a basic agreement on the modalities of negotiations for goods trade, and this is based on the Japanese proposal that was tabled at the ASEAN Summit in Cebu in January,” Amari said.

For their part, ASEAN ministers and officials, who had long complained of the slow pace of the trade talks with Japan, heaved a sigh of relief over Friday’s outcome.

“Essentially, we have broken a deadlock that allows us to move forward,” senior Philippines trade official Ramon Kabigting said.

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