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International relations

Free trade sphere grows, leaving US in the cold

Japan-EU pact cuts duties on cars, wine and cheese in blow to American competitiveness

Japanese Prime Minister Shinzo Abe, center, flanked by European Commission President Jean-Claude Juncker, left, and European Council President Donald Tusk (Photo by Uichiro Kasai)

TOKYO -- Japan's economic partnership agreement signed with the European Union on Tuesday looks to invigorate a host of other free trade efforts including the 11-nation Trans-Pacific Partnership and deals between the EU and South America, raising the unexpected possibility the U.S. will be left out in the cold as the world speeds toward multilateralism.

Under the new Japan-EU pact, both sides will tear down barriers on industrial products and agriculture. Europe's 10% tariff on Japanese passenger cars will be phased out over eight years, and levies on 92% of Japanese autoparts will vanish immediately. Mazda Motor, which exports from Japan over half the vehicles it sells in Europe, hails it as a "major accomplishment."

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