ROUSSEFF AND BARROSO OPTIMISTIC ABOUT MERCOSUR/EU TRADE TALKS SCHEDULED TO BEGIN 21 MARCH

Brussels, February 25- Trade negotiations between the European Union and MERCOSUR could move quickly once a technical meeting next month has taken place, EU Commission President Jose Manuel Barroso said after a meeting yester|day with Brazilian President Dilma Rousseff in Brussels and the European Council president Herman Van Rompuy.

Following the high-level technical meeting on March 21, the EU will be able to “see whether necessary conditions are in place for a formal exchange of offers and then that could take place very quickly afterwards” Mr. Barroso said.

He added that the deal would affect more than just trade. “It will allow for the completion of an economic area in the long run between Europe and South America”.

“Europe is working on a number of different bilateral agreements, and it would be a shame not to have an ambitious agreement such as this with our friends in Brazil and MERCOSUR,” he underlined. The EU is currently engaged in talks with Washington on a wide-ranging free trade deal.

Trade talks between the two blocs have been delayed since December with countries on both sides harmonizing their proposals. The EC president is also anxious to have an agreement with MERCOSUR on rail before he steps down next May.

“When it comes to signing the agreement, I don't want to speculate on which areas are most difficult,” Mr. Barroso said. “Some areas are more sensitive than others on the two sides... we should concentrate on the huge potential in this agreement”.

President Rousseff said that “for the first time, I think we are close to achieving that objective; I think both sides are very much aware of the importance of this trade agreement”.

Industry groups in Brazil have been pushing for the free trade deal and so have junior MERCOSUR members Uruguay and Paraguay, while Argentina is more reluctant. Ms. Rousseff said there would be a “clearer picture” after the meeting next month, (March 21) with agreement getting nearer.

“It is in Brazil's interest, other countries in MERCOSUR also have an interest in completing this process,” she said following the meeting. “Both sides are very much aware of the importance of this trade agreement”.

The EU is Brazil‘s most important trading partner, receiving more than 20% of the country‘s exports and accounting also for a similar share of its imports, according to commission figures. Brazil is the EU‘s eighth largest trading partner.

Rousseff, meanwhile, rejected EU criticism of a free trade zone in the Amazonian city of Manaus, after Brussels accused Brazil of granting unfair tax advantages.

“We‘re talking about clean production in the Amazon. It produces jobs and it is crucial to ensure that the rain forest remains standing,” the president said.

This was the seventh EU/Brazil summit, since the establishment of their Strategic Partnership in July 2007.

Before travelling to Brussels, Rousseff met Pope Francis at the Vatican on Friday. She also attended a ceremony in which Rio de Janeiro archbishop Orani Joao Tespesta was made a cardinal.

<