The United States said it saw "real interest" in concluding free trade agreements with South Korea and Malaysia, as crucial talks resume in the new year to strike deals ahead of the expiry of President George W Bush's trade-negotiating authority.

The fourth round of negotiations between the United States and Malaysia began in San Francisco on Monday while the sixth round of talks with South Korea will be held next week.

"I think there is a real interest in concluding a high quality agreement in both cases - South Korea and Malaysia," US Trade Representative (USTR) spokesman Stephen Norton told AFP.

"In any negotiations, there are sensitive subjects and we are dealing increasingly with complex economies and the negotiations can get complex, but I do think that the interest in concluding the agreement is very strong on both sides," he said.

The Bush administration needs to forge deals by early April in order to submit it to lawmakers before the president's powers to strike free trade agreements expire in June.

Critical areas

The United States and Malaysia had detailed discussions on critical areas such as labour, financial services, autos and government procurement in the last round of talks in Kuala Lumpur and want to make more progress this week, officials said.

"A major problem is that we will have to get over with the fundamental approach to the whole negotiations - the US side uses a 'negative list' approach while Malaysia goes for a positive list approach - and this seems completely opposed to each other," one official familiar with the negotiations said.

Washington's general policy is to include in its negotiation list only areas which it wants the other side to liberalize. Malaysia incorporates in its list only areas it is prepared to open up.

The official, speaking on condition of anonymity, said Malaysia had stoutly defended US attempts to prise open the developing economy's financial services sector and to liberalise industrial relations in the electronics sector, where Kuala Lumpur allows only so-called "in-house" unions.

The Democratic party, which won control of the US Congress in November elections, has signaled it will press for better labour and environmental standards in free trade agreements.

Norton said Malaysia, the 10th largest US trading partner, "is fully aware that we cannot conclude an FTA without the inclusion of a labour chapter."

He added that both sides had exchanged initial market access offers in goods and agriculture at the last round and that "the initial offers that we received from Malaysia were a solid basis for continued negotiations."

Asked whether there was optimism a deal with Malaysia could be concluded by April, Norton said, "We will just have to see how it goes this week, whether we need additional rounds and our goal still is to conclude the negotiations before trade promotion authority expires.

"We are doing everything we can to make that possible," he said.

Talks with South Korea 'more complex'

The negotiations with South Korea beginning Jan 15 in Seoul are expected to be more complex.

South Korean and US officials are at odds over Seoul's decision to ban three shipments of US beef over small bone fragments even though it has lifted a three-year import ban imposed following US cases of mad-cow disease.

The issue is not part of the free trade talks but helped sour the atmosphere of the fifth round.

Neither side can afford to miss a "once in a lifetime opportunity," William Oberlin, new chairman of the American Chamber of Commerce in Korea, said recently.

An FTA with South Korea would be the United States' biggest deal since the North American Nafta pact in 1994, marrying two economies - Canada and Mexico - whose bilateral trade last year totalled US$72 billion.