The European Union and Japan have agreed the broad outline of a free trade deal, in a direct rebuke to the protectionist instincts of US President Donald Trump.

Agreement was reached just 24 hours before the meeting of G20 nations in Hamburg, which will be attended by President Trump, Japanese Prime Minister Shinzo Abe, and EU chiefs.

The EU and Japanese economies combined account for more than a quarter of global output, making the trade deal one of the largest ever attempted.

Japan was part of the failed Trans-Pacific Partnership, the 12-nation trade agreement, which was scuppered by Mr Trump, who champions an America First policy, in January.

Abe was in Brussels today to shake hands with European Commission President Jean-Claude Juncker and European Council President Donald Tusk on an “agreement in principle”, which leaves some of the more contentious issues for further discussion later.