Boeing boss Jim McNerney is upbeat about the US firm's future

Jim McNerney, Boeing's chief executive, said that the two sides seemed to have increased the pace of their dialogue.

In a long-running spat, Boeing and European rival Airbus have complained to the World Trade Organization (WTO) that the other gets illegal state aid.

Negotiators looked to play down hopes of a quick resolution to the clash.

Mixed picture

Speaking at a briefing for journalists, Boeing's Mr McNerney said that he was hopeful the dispute would be negotiated and resolved.

"I am beginning to see signs that the two governments are increasing the pace of dialogue and I am supportive of that," he explained.

US trade representative Rob Portman said he was "not aware" that the dispute was nearing resolution.

Mr Portman added that the US "will look forward to hearing from the EU and in the meantime we keep all channels open".

Peter Mandelson, the EU trade commissioner, said: "It is in everyone's interest that we start these trade talks as soon as possible."

Yves Galland - who is in charge of Boeing's French operations - said: "a certain number of contracts at government level" had increased the chances of resolving the dispute.

Complicated case

The disagreement could be the largest and most complicated case the WTO has ever faced, analysts said.

The US formally complained to the WTO in May 2005 about the EU providing government subsidies to Airbus.

Known as "launch aid", it is these subsidies for new models that have most irked Boeing.

Hitting back, the EU filed a complaint against Boeing, claiming it received financial help from the US in the form of lower taxes and funding from the military.

Most recently the EU claimed that the US had "violated its basic duty to cooperate" when it refused to reveal information about 13 schemes that help Boeing on the grounds that they fell outside the WTO's remit.

Adding to the friction between the companies is their attempts to become the world's top commercial plane maker.