(Adds Mercosur, context) LISBON, May 10 (Reuters) - President Alberto Fernandez said on Monday he hoped a new, sustainable deal with the International Monetary Fund that would allow heavily-indebted Argentina to develop and take into account post-pandemic conditions can be reached soon. “What we have always asked for is a deal which does not put into question our ability to develop and end inequality. I want to reach a deal that is sustainable,” he told reporters. The South American country is seeking to replace a deal struck with the IMF in 2018 and push back payments it cannot meet amid a lengthy recession sharpened by the COVID-19 pandemic. “I ask the IMF for understanding of the time we are living in. I hope a deal can be reached soon,” Fernandez said during a visit to the Portuguese capital Lisbon. Fernandez had said in March he did not want to rush into a new deal. Many investors now expect an agreement, initially projected to be agreed in May, will only be reached after mid-term elections, set to take place in November. Fernandez, who was speaking at a joint news conference with Portuguese Prime Minister Antonio Costa, also said his administration was working with creditors to change some rules of the international financial system in light of the pandemic. “I was able to transmit to (Costa) the situation which Argentina is in and the work we are doing with the creditors to try and reach not only a deal between the IMF and Argentina but also change some rules of the international financial system which are related to the post-pandemic world,” he said. EU-MERCOSUR Costa, in turn, said conditions were now in place to quickly ratify a deal between South American trade bloc Mercosur and the European Union, which Portugal hopes to achieve during its six-month EU presidency that ends on June 30. The deal, agreed in 2019 after 20 years of negotiations, promised to be the EU’s largest yet, removing 4 billion euros ($4.87 billion) of import tariffs. But ratification has stalled due to concerns among EU member states about deforestation in Brazil’s Amazon region. Mercosur countries say they are awaiting an EU text on climate change which would address these concerns. Costa said it was urgent that the EU present its document as soon as possible. Fernandez said that some countries were still creating difficulties in negotiations, and that the two blocs needed to “work a little more” on the agreement. ($1 = 0.8221 euros) (Reporting by Victoria Waldersee Editing by Andrei Khalip, Ingrid Melander and Mark Heinrich) Our Standards: The Thomson Reuters Trust Principles.