Japan and Chile have signed a free trade pact, Tokyo’s first with a South American nation and only its fifth overall, that will eventually scrap over 90% of tariffs on bilateral trade worth $8.2 billion last year.

The two nations will work to bring the pact into effect by the time of a visit to Japan by Chilean President Michelle Bachelet expected in September.

The agreement was signed on Tuesday by Japanese Foreign Minister Taro Aso and Chilean Foreign Minister Alejandro Foxley during a three-day visit by Foxley to Japan.

Under the agreement, nearly all Japan’s exports to Chile, worth $1.07 billion would be tariff-free, while 90.5% of Chilean shipments to Japan, worth $7.13 billion would be exempt from tariffs within 10 years of the deal taking effect.

The main items traded between Japan and Chile include minerals, fish and meat, wine, electronics and autos. (Reuters)