CNN said the European Union and Japan signed a huge free trade deal on Tuesday that cuts or eliminates tariffs on nearly all goods.

The agreement covers 600 million people and almost a third of the global economy. It's also a major endorsement of a global trading system that is under increasing threat from protectionism.

It will remove tariffs on European exports such as cheese and wine. Japanese automakers and electronics firms will face fewer barriers in the European Union.

Donald Tusk, president of the European Council, hailed the agreement as the “largest bilateral trade deal ever.”

“Relations between the European Union and Japan have never been stronger,” he said in a written statement. “Geographically, we are far apart. But politically and economically we could hardly be any closer.”

Japan and the European Union traded roughly EUR 129 billion of goods last year, according to EU data.

CNN adds EU trade commissioner Cecilia Malmström said last month that Europe was willing to lower some of its tariffs and cooperate with the United States. But the Trump administration “closed the door” on the talks and subsequently slapped tariffs on EU steel and aluminium. New American tariffs on European cars could follow soon.

Average global tariffs are near record lows. EU products currently face an average tariff of 1.6 percent when they arrive in Japan, while Japanese products face tariffs of 2.9 percent in the European Union, according to the World Trade Organization.

Still, the European Union said the tariffs cost its companies up to EUR 1 billion annually.

According to CNN the trade deal is expected to come into force in 2019 after being approved by lawmakers on both sides.