EU agrees to open talks on free trade deal with Japan

A Japanese flag flutters in front of a shipping container area, at a port in Tokyo Nov 12, 2012. Japan's economy shrank 0.9 per cent in the three months to Sept, marking the first contraction in three quarters, adding to signs that slowing global growth and tensions with China are nudging the world's third-largest economy into recession. -- PHOTO: REUTERS

BRUSSELS (AFP) - European Union (EU) trade ministers on Thursday agreed to launch negotiations on a potentially giant free trade deal with Japan despite concerns from European car-makers, EU diplomats said.

A decision to give the EU executive, the European Commission, a mandate to launch the talks, which could take several years, was "just agreed" by the bloc's 27 trade ministers, said one EU diplomat.

The EU, which together with Japan accounts for more than a third of the globe's output, is looking to accelerate trade deals worldwide to give its struggling economies a shot in the arm.

The EU's Trade Commissioner Karel De Gucht has said a free trade deal (FTA) could increase EU gross domestic product (GDP) by almost one percentage point, boost EU exports to Japan by one third, and add 400,000 extra jobs across the 27-nation bloc.