* Negotiations start despite Maoist&${esc.hash}39;s arrest on eve of talks
* Chief rebel negotiator sees hope for "new beginning"
* Closed-door talks to focus on economic and social reforms
(New throughout with start of talks)
By Wojciech Moskwa
NESBRU, Norway, Feb 15 (Reuters) - The Philippine government and Maoist communist rebels sat down for their first formal peace negotiations in more than six years on Tuesday despite the arrest of a senior insurgent on the eve of the talks.
The negotiations in the Oslo suburb of Nesbru and facilitated by Norway are not expected to produce immediate results to end an insurgency that dates back half a century. But the sides may agree to hold more talks and extend a ceasefire.
The government and the Maoist-led NDF have been in stop-start negotiations for nearly 25 years to end one of the world&${esc.hash}39;s last remaining communist insurgencies in which 40,000 people have been killed.
"Clearly there is much that decides the two sides that come to the table, but there is also much which unites us," Teresita Quintos-Deles, the Philippine president&${esc.hash}39;s advisor to the peace process, said at the start of the week-long talks.
Quintos-Deles said social and economic reforms would be discussed at the closed-door negotiations to "unblock the road to peace", and that both sides have been "guilty of believing that arms will win the day" and sidelining mediation efforts.
The communist movement&${esc.hash}39;s 4,000-strong New People&${esc.hash}39;s Army (NPA) has been blamed for attacks and extortion on mines, farms, construction and other businesses, including mobile phone companies, scaring away potential investors away rural areas.
Alan Jazmines, a communist leader, was detained in a raid on a rebel hideout north of Manila on Monday, hours before the start of a seven-day ceasefire between the government and the NPA and the peace talks.
NEW BEGINNING?
The rebels&${esc.hash}39; chief negotiator, Luis Jalandoni, demanded the release of Jazmines, whom he called a "valued consultant". But he did not delay talks which, unlike past efforts, are set to include discussions on sweeping social and political reforms.
"Now, after six years of sabotage of the peace talks...we stand at the threshold of a new beginning," Jalandoni said in his opening remarks.
Jalandoni said Jazmines had to be freed as he was a consultant of the National Democratic Front (NDF), the rebels&${esc.hash}39; political arm engaged in the peace talks, and covered by an immunity agreement.
The chair of the government negotiating team, Alexander Padilla, said the authorities were checking if Jazimines had proper accreditation as a consultant.
Last week, government negotiators said they were optimistic talks would produce results in 18 months and saw peace achievable in three years if both sides were sincere.
Analysts do not share that optimism, saying there are many serious obstacles to peace talks, although the negotiations could reduce violence, particularly human rights abuses.
"Neither side will win militarily," risk consultancy International Crisis Group said. "(But) it is far better to negotiate than to wage an unwinnable war."
Jalandoni said the dire state of the Philippine economy made it essential to reform economic and social policy that he said was a victim of "American imperialism".
After talks on economic issues were completed, the negotiations will focus on political and constitutional reforms. Human rights and political prisoner issues would be a side-table debate that would not derail what is the clearest attempt to gain a peace accord with the Maoists since 2004.
"What we do, or not do, in Oslo this February is for us Filipinos a matter of life and death," Quintos-Deles said.
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