Ethiopian Foreign Minister Seyoum Mesfin claimed ``glorious victories'' in what both sides said was heavy fighting, and quoted Prime Minister Meles Zenawi as saying the war could be over in days.

Retaking heavily fortified Zalambessa has been a goal of Ethiopia since Eritrea seized the area at the start of the sporadic 2-year-old border war. Rough terrain there makes the assault difficult and possibly costly.

Eritrea radio reported there that the country's forces were beating back a ``large-scale offensive'' that Ethiopia had launched at dawn.

It was impossible to determine immediately the truth of the claims. Both countries have large armies - Ethiopia, 350,000; Eritrea, 250,000 to 300,000 - bolstered by Soviet-made warplanes and other heavy weaponry.

The potentially decisive engagement came as Western and African envoys started a second day of shuttling between the two capitals to press for a cease-fire and peace talks.

Rino Serri, European Union special envoy for the Horn of Africa, said he was discussing a ``further concrete initiative that may accelerate...the peace process'' but would not give details.

``There is willingness ... to restart and I think that this a high possibility,'' Serri said before heading back to Asmara for a second meeting with Eritrean President Isaias Afewerki, after talking late Monday in Addis Ababa with Meles, the Ethiopian prime minister.

Ethiopia launched an all-out drive deep into Eritrea on May 12 in a bid to force an end to the countries' off-and-on war, which has cost the two impoverished nations tens of thousands of lives and hundreds of millions of dollars.

Since the invasion, most of the action has been on the western front, which the Ethiopians claim to control after seizing the Eritrean town of Barentu last week.

However, the Zalambessa front, surrounded by high ground better suited to defense than attack, has been regarded as the most important Ethiopian goal.

The area has seen bloody fighting between the two countries in the past.

Military analysts believe the outcome of engagements there, which could produce the fiercest fighting of the war so far, will be the key to the result of the conflict.

Zalambessa, which sits at the foot of a long range of mountains, was the second area of Ethiopian territory to be occupied by Eritrean forces when the war began in 1998.

The first, Badme on the western front, was recaptured by Ethiopia after intense fighting in February 1999.

Ethiopia launched its latest offensive after talks organized by the Organization of African Unity broke down on May 5.

On Monday, Meles rejected appeals for a cease-fire to allow for peace talks.

``We shall negotiate while we fight and we shall fight while we negotiate,'' Meles declared before African diplomats in Addis Ababa.

Ethiopia maintains its objectives in the offensive are to destroy the Eritrean army, secure border territory it claims as its own, then withdraw.

The fighting is believed to have displaced more than a half-million Eritreans, some of whom have fled into neighboring Sudan.