When I tried to upgrade "setuptools" in my virtual environment, pip (already upgraded) recognizes a list of versions between 0.6b1 and 75.3.2. I did upgrade it to the latest version.
However when I try installing another package (in this case GDAL) in the environment it throws an error :
ERROR: No matching distribution found for setuptools>=77.0.3 [end of output] note: This error originates from a subprocess, and is likely not a problem with pip. error: subprocess-exited-with-error × pip subprocess to install build dependencies did not run successfully. │ exit code: 1 ╰─> See above for output. note: This error originates from a subprocess, and is likely not a problem with pip.
I noticed that the latest version of setuptools as this date is 80.9.0

When I tried manually to enter the package version however, it does not recognize it.
pip install --upgrade setuptools==80.9.0
produces:
ERROR: No matching distribution found for setuptools==80.9.0
Does it mean that I can not use "pip" in this situation and must create "wheel" from source distribution?
The upper version of setuptools 75.3.2 suggests that you run pip under Python 3.8 because the next version 75.4.0 requires Python 3.9+. If you need a higher version of setuptools you need a higher version of Python. Upgrade your Python to at least 3.9. The current latest version 80.9.0 still works with 3.9+.