By Henrique Almeida

LISBON, July 3 (Reuters) - Portugal plans to invite South America's biggest nation Brazil into a select group of European Union strategic partners when it hosts the first summit of its EU presidency on Wednesday.

The summit is set to allow the former Portuguese colony to join the ranks of countries such as the United States, Russia and China by 2008 as a partner of the 27-nation bloc.

The meeting of European Commission President Jose Manuel Barroso, Brazilian President Luiz Inacio Lula da Silva and other leaders signals a higher profile for Latin America in EU foreign policy as it shifts its focus from eastern Europe.

"Brazil can serve as an important lever to deepen ties between the EU and Latin America," Portugal's Foreign Minister Luis Amado said. "It is one of the world's emerging economies with considerable negotiating power in various sectors."

The partnership is meant to improve cooperation between the EU and Brazil in areas like trade, renewable energy and the fight against poverty.

Brussels also sees Brazil -- one of the world's biggest emerging economies which is home to most of the Amazon's rainforest and a major biofuels producer -- as a key player in the fight against global warming, one of the EU's priorities.

"Brazil has an important role in the production of biofuels and we will also look at ways to cooperate in that area," said Clara Borja, a spokeswoman for Portugal's EU presidency.

Lula is due to visit Brussels on Thursday for a conference on biofuels, part of his country's push to foster consumption and production of fuel made from crops rather than fossil fuels.

EU leaders agreed in March to a target for biofuels to represent at least 10 percent of vehicle fuels by 2020.

TRADE TIES

The summit will also address bilateral trade and investment issues to complement the EU's talks for a trade deal with the Mercosur group of South American countries including Brazil.

These talks are on hold pending an outcome of struggling global trade talks at the World Trade Organisation, in which Brazil has locked horns with the EU and the United States.

Brazil is the EU's main trading partner in Latin America.

Trade with Brazil totalled around 39 billion euros ($53 billion) in 2005, the EU importing 23 billion euros, mostly agricultural products, and exporting 16 billion, according to the European Commission.

That is why Brazil's Lula has sounded an uncompromising note over the negotiations, saying rich nations must open up their markets to agricultural imports before demanding trade concessions from developing countries.

"We made a point of saying the days of subservience are over. We want to be treated as equals," the former union leader told workers at an auto industry event in Sao Paulo on Monday.

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