MercoPress. South Atlantic News Agency

Encouraging signs for Mercosur .

Mercosur delegates received an encouraging sign this week when Chris Patten the European Union Foreign Affairs Commissar admitted that discussions for a trade agreement between EU and the South American block could conclude before the end of 2003.

Only last week Mercosur main negotiators Argentine Deputy Foreign Affairs Minister Martín Redrado and Brazilian Development Minister Luiz Furlan were talking of reaching an agreement some time in 2004.

"I'm convinced both sides can conclude negotiations before the year is over", remarked Mr. Patten. "It's great news. Mr. Patten's job is political, so the announcement is really more political than technical", remarked Mr. Redrado.

This week Mercosur will be presenting in Brussels trade proposals requesting mainly an increase in the agriculture import quotas of the European Union and leaving discussions on farming subsidies for the Doha round of the World Trade Organization, WTO. Actually the Mercosur list includes 2,800 products according to a release from the Argentine Foreign and Trade Affairs Office.

The proposal should have been presented last Monday but striking staff from the European Union offices in Brussels forced a delay until Thursday.

Apparently in exchange Mercosur will offer more liberal terms in investments, services and government purchasing, but will insist in strict import quotas in the automobile industry, steel, textiles and metal-mechanic sector.

Originally both sides had agreed that a deal could only be reached once the Doha round was over towards the end of 2004.

However given the new consensus and following the exchange of proposals everything should be ready for a "positive" tenth round of talks scheduled to take place in the capital of Paraguay at the end of June. A summit of trade ministers from the EU and Mercosur is expected to take place sometime after the WTO meeting that has been convened for next September in Cancún, Mexico.

Mercosur and EU began trade liberalization talks began in 2000, almost at the same time as Chile, that finally reached an agreement last November.

Political analysts believe that the landslide victory of Mr. Luiz Inacio Lula da Silva in Brazil and the recent election of Mr. Nestor Kirchner as Argentina's next president has been interpreted as a ratification of Mercosur by the European Union..

Argentine next Foreign Affairs Secretary Rafael Bielsa, in his first statements after having been nominated to the post said that relations with Brazil "will be the top priority" as well as regional "strengthening".

"We need a regional agenda, once consolidated we can talk as a block, more forcibly, louder", indicated Mr. Bielsa.