The European Union has agreed a multi-billion euro free-trade agreement with Canada, following years of intense negotiations over agricultural exports.

Canadian Prime Minister Stephen Harper and European Commission President José Manuel Barroso signed-off on the historic agreement in Brussels.

Mr Barroso tweeted that the deal with Canada is good news for both Europe and the world economy.

He said the agreement will increase bilateral trade by 23% or around €26 billion.

Mr Barroso said it would be an effective stimulus to the EU economy and would boost EU GDP by around €12 billion per year.

It is the first free trade agreement between the EU and a G8 country.

Jobs, Enterprise and Innovation Minister Richard Bruton said it would result in job creation as it had the potential to add over €200m in Ireland's bilateral trade with Canada.

John Whelan of the Irish Exporters' Association told RTÉ's News at One programme that he was delighted with the agreement, which he maintained would give a major boost to the services sector.

However, the deal has been met with some concern by the Irish Cattle and Sheep Farmers' Association.

ICSA beef chairman Edmond Phelan said: "I am concerned that imports of cheaper Canadian meat have the potential to undermine the price of Irish beef in key export markets within the EU.

"While there may be some upside in terms of exports, the likelihood is that there will be more pain than gain for Irish farmers."

The Irish Creamery Milk Suppliers Association said the deal would bring new opportunities for the dairy sector, but it also expressed concern that it could affect the beef trade in Ireland.

IFA President John Bryan this afternoon warned the EU Commission that it cannot repeat the market-access concessions on agriculture announced in the deal in forthcoming negotiations with the US.

Mr Bryan said it is unacceptable that the EU Commission is allowing the agriculture sector in Europe to be used as the bargaining chip in major trade negotiations.

He said: "Under this deal, the EU Commission cannot allow Canada to undermine the European beef market by cherrypicking the most valuable end of the trade with steak cuts."