The Japanese government says it has agreed to enter negotiations with the United Arab Emirates for an Economic Partnership Agreement, or EPA.
Tokyo aims to boost ties with the UAE to ensure a stable supply of crude oil.
The UAE was the second-largest crude oil supplier for Japan in terms of volume last year after Saudi Arabia.
Japan also wants tariffs to be cut or abolished on cars and auto parts. Most of the items currently get a five-percent levy.
The industry ministry says auto-related exports accounted for over 40 percent of the value of Japan’s shipments to the UAE last year.
Meanwhile, the UAE wants to diversify its industry. The country is looking to end its reliance on an energy-dependent industrial structure.
The country is a major oil producer that has recently been investing in renewable energy. It is said to be eyeing Japanese technology to help it achieve decarbonization.