Brazil's President Luiz Inacio Lula da Silva told his Israeli counterpart Shimon Peres yesterday that Middle East peace has long been his dream.

"Mr President Peres, I dream of the day when the Middle East will have peace so that all peoples can achieve prosperity," he said in Jerusalem where he met Mr Peres and other Israeli leaders.

"The virus of peace has been with me since I was in my mother's womb. I can't remember ever having a dispute with anyone," he said, stressing the need for dialogue.

Mr Lula, on the first visit to the region by a Brazilian head of state, hopes to bring a fresh outlook to the peace process during his talks in the Middle East. Today he is meeting Palestinian leaders in the West Bank, before travelling to Jordan tomorrow.

However, Mr Lula's visit comes hot on the heels of a controversial Israeli decision on new Jewish settlements in annexed east Jerusalem, leading the Palestinians to rule out peace talks amid continued settlement building.

Before leaving Brazil, Mr Lula said the peace process needed "someone with neutrality to speak the truth to the Israelis, to tell the truth to Palestinians, Iranians, Syrians, and whoever wants to hear the truth".

Later, he met Prime Minister Benjamin Netanyahu and the two agreed to strengthen bilateral relations between the two countries, Mr Netanyahu's office said.

The Cabinets of Israel and Brazil would hold a joint meeting every two years, the statement said. Israel has similar agreements with Germany and Italy.

Mr Lula also said he wanted to drum up business for Brazil.

"We hope to advance economic and business ties between Israel and Brazil as trade has increased significantly between our two countries in the past few years. We can continue with the current momentum," he said.

"I am launching a new investment plan in Brazil soon and I invite Israeli companies to take an active and significant part," he said.

The volume of two-way trade totalled $1.6 billion in 2008, of which $1.2 billion was in Israeli exports to Brazil, according to Israeli figures.

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