MercoPress. South Atlantic News Agency

EU's Mandelson hopes Mercosur talks to resume in May.

The European Union hopes to resume stalled talks that aim at setting up a free trade agreement with South American trade bloc Mercosur by May at the latest, EU Trade Commissioner Peter Mandelson said yesterday.

Talks to create the world's biggest free trade area broke down last year, with the Latin Americans demanding a bigger share of Europe's sugar, beef and poultry markets and the EU pressing for access to services and public procurement markets.

"I hope, possibly, to prepare the way for political contact between the EU and Mercosur at the latest by early May," Mandelson told the European Parliament.

Negotiators from the four-nation Mercosur bloc ? comprising Brazil, Argentina, Paraguay and Uruguay ? met EU officials last week to see where they might be able resume negotiations on a free trade agreement, he said.

The aim was to resume with the "highest previous offers made by both sides," Mandelson said, adding that there were some difficulties at this stage in establishing what they were.

Mercosur has been seeking a free trade deal with the EU for more than five years. A deal would knock down tariffs on goods and services in a market of 680 million people, giving a huge boost to bilateral trade from the present $40 billion a year.