Slovenia, Croatia ministers close to deal over bank row

The foreign ministers of Slovenia and Croatia said on Wednesday they had agreed on a possible solution to a long-standing dispute over bank savings which, if accepted by their governments, would help open the way for Croatia's EU accession in July.

"We have a solution that is acceptable for both sides," Slovenia's top diplomat Karl Erjavec told journalists after a six-hour-long meeting with his Croatian counterpart Vesna Pusic in Otocec, some 75 kilometres (45 miles) east of the Slovenian capital Ljubljana.

"The technical issues have been cleared out, now what remains is the political issue, and I believe there is a chance that we will convince our governments that this is the real political solution," Erjavec said.

He added with their proposal "Slovenia would accomplish its objectives" in its dispute with neighbouring Croatia and could resolve the row by March.

Slovenia has warned it will not ratify Croatia's EU accession treaty unless Zagreb agrees to resolve a decades-old row over Croatian savings in Slovenia's Ljubljanska Banka (LB) before the former Yugoslavia collapsed in the 1990s.

Croatia is set to join the European Union July, but it still needs all member states to ratify an accession agreement.

Pusic confirmed that "we have more-or-less come to what could be a possible solution."

"Our task now is to present the different versions of that solution to our prime ministers," Pusic said, adding that the two governments will still have to decide on which of the "versions" on the table would be implemented.

Pusic also said she expected to meet Erjavec again on February 19 in Croatia.

In a bid to solve the dispute, the foreign ministers had asked two top financial experts -- Slovenia's France Arhar and Croatia's Zdravko Rogic -- to find common ground for a solution.

The two neighbours disagree over money that needs to be repaid and whether to resolve the dispute bilaterally or as part of ongoing internationally brokered talks on the distribution of the former Yugoslavia's wealth.

A Slovenian government crisis, which deepened after two junior coalition parties quit the alliance, has put additional pressure on the negotiations that could end in a deadlock if the current government falls or early elections are called.

Erjavec, who announced on Tuesday he will resign as foreign minister later this month after his party quit the ruling coalition, said he expected the Slovenian parliament to ratify Croatia's EU accession treaty in March.