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Unlike Nafta, which eventually eliminated duties on goods sold between Mexico, the United States and Canada, a European free-trade agreement would focus more on harmonizing regulatory standards between the United States and Europe.
Trade agreements eliminated duties and other restrictions that had boosted costs.
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Most expected a short-term boost as the change, which eliminated duty on houses under £175,000, came in.
But the saving from eliminating duties would still be significant because the volume is so enormous.
The accord with Peru would allow its exports into the United States duty-free and would eliminate duties on most industrial and farm exports from the United States to Peru.
The government said it would eliminate duties on professional equipment for the services industry and on fuel for the manufacturing industry.
Loosening restrictions on renewable technologies, which includes key components used in generators and wind turbines, can help reduce the cost of wind energy by eliminating duties.
The United States trade representative, Charlene Barshefsky, said "substantial progress" was made in negotiations this week on the pact, which would eliminate duties on the nations' bilateral trade.
On Jan . 1 the North American Free Trade Agreement will eliminate duties on heavily subsidized American wheat, rice, barley, potatoes, dairy products, poultry, pork and beef.
Israel and Jordan expanded a 1995 trade agreement between the countries to eliminate duties by 2010, the Ministry of Trade and Industry in Israel said.
But Republicans said Democrats were only hurting American workers, arguing that the agreement would level the playing field by eliminating duties on American-made goods entering Colombia, which already has significant duty-free access to the United States.
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