Japan and Chile have sealed a free trade deal which will lower tariffs on a range of goods including cars, copper, fish, tea and wine.
The agreement, signed by the countries' respective foreign ministers in Tokyo, is the first of its kind between Japan and a South American nation.
Japan has pursued a series of bilateral trade deals in recent years and is due to sign another with Thailand shortly.
For its part, Chile concluded a free trade deal with China in 2005.
The latest deal will reduce tariffs on the majority of goods traded by the two countries.
But it will not extend to farm products such as rice, which Japan is keen to protect.
"By accelerating and developing a strategic economic alliance in various fields between Japan and Chile, Japan expects that both our economies will be vitalised markedly," a spokesman for the Japanese Foreign Ministry said.
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