Japan and Vietnam signed an economic partnership agreement Thursday, laying the ground for about 92 percent of their trade in value to be duty-free in 10 years.
The agreement, signed by Foreign Minister Hirofumi Nakasone and Vietnamese Industry and Trade Minister Vu Huy Hoang in Tokyo, will come into effect as early as next year after the two countries complete necessary domestic ratification procedures, according to Japanese officials.
"We celebrate the signing of the agreement, which will elevate bilateral economic relations to a higher plane and bring tangible mutual benefits to the people of the two countries," said a joint statement of the two ministers.
This is Japan's 10th free-trade agreement, after accords with Singapore, Mexico, Malaysia, Chile, Thailand and the Association of Southeast Asian Nations.
It is Vietnam's first bilateral FTA.
The officials said the latest agreement is much more ambitious than the one agreed with the 10-member ASEAN, which includes Vietnam, Singapore and Indonesia.
The accord between Japan and Vietnam will ensure bigger cuts in trade barriers on goods, investment and services, they said.
Japan and Vietnam launched negotiations for the agreement in January 2007.