Burkinabe mediators hosting talks between Mali's government and armed Tuareg rebels said they hoped for an agreement Monday to enable elections to be held nationwide next month.
"We're counting on (Monday) to conclude an accord," Burkina Faso Foreign Minister Djibrill Bassole said after a weekend of talks between the government and the Tuareg rebels who control the key northeastern city of Kidal.
But he warned that "distrust" persisted between the rivals, following an eruption of deadly fighting last week as government troops advanced towards Kidal following reports of "ethnic cleansing" there.
The government has been struggling to reestablish its authority over all of the west African country after a coup in Bamako created a power vacuum that saw Al-Qaeda linked Islamists and Tuareg rebels overrun the north.
UN chief Ban Ki-moon said in a report on Sunday that the militants in Mali remained a threat to all of west Africa and voiced concern about next month's planned election.
The Tuareg rebel National Movement for the Liberation of Azawad (MNLA) has held Kidal since January, in the wake of a French-led military offensive to oust the armed Islamists from the vast desert region.
The rebels refuse to let government troops or officials into Kidal, posing a threat to Bamako's plans to hold a nationwide presidential poll on July 28, the first since the March 2012 coup plunged the country into chaos.
The Ouagadougou talks follow heavy fighting which erupted last week when the army launched an attack in Anefis, a town south of Kidal, following reports that the light-skinned Tuaregs had been arresting and expelling black Malians in the city.
The army said 30 rebel soldiers were killed. The MNLA claimed that several army vehicles were destroyed and the men aboard them killed.
"There is a lot of distrust at the moment, particularly after the latest events at Anefis," Bassole said.
He gave no details of the proposed agreement, but said mediators "are working very hard on the means of deploying Malian defence and security forces in the Kidal region".
Burkinabe President Blaise Compaore has said the Malian parties must agree on the "redeployment of general administration, basic social services, defence and security forces to the north of Mali and in particular to Kidal".
He has invited members of the international community to participate in the talks, including the United Nations, the African Union, and former colonial power France.