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Serbia and its former province of Kosovo initialled a historic deal Friday to normalise ties, a move key to the future of the Western Balkans and destined also to bring both closer to the European Union.
Hailed as a milestone deal by EU leaders, the premiers of Serbia and Kosovo, Ivica Dacic and Hashim Thaci, put their signatures to a 15-point agreement struck after two years of tough talks to reduce mutual tension.
"What we are seeing is a step away from the past and, for both of them, a step closer to Europe," said EU foreign policy chief Catherine Ashton.
Fourteen years after the end of the war and five after Kosovo unilaterally declared independence from Serbia, hopes are that the deal will turn the page on Europe's last Balkans trouble-spot.
"The agreement will help us heal the wounds of the past," Thaci said. "This agreement represents the start of a new era, an era of reconciliation and inter-state cooperation."
Dacic said "Serbia's proposals were accepted. I initialled a proposed text that both sides will decide upon in the following days to say whether they accept it or refuse it."
But in the northern Kosovan city of Kosovska Mitrovica, Kosovo Serbs called for a referendum and dubbed the deal "the worst surrender and betrayal" ever perpetrated by Belgrade.
Discussions between the two premiers, crucial to future ties with the EU, were the second in Brussels this week after they hurried back on Ashton's request less than 48 hours after the collapse of earlier talks.
EU ministers meeting Monday were waiting for the outcome of the Serbia-Kosovo talks to decide whether to open the door to EU membership to Belgrade, which hopes to be given a date to launch membership talks at a June EU summit.
Without an agreement by Monday, Serbia's integration into the EU would have been delayed indefinitely.
Pristina still needs to win recognition by five of the 27 EU states but hopes meanwhile to be rewarded for mending fences with Belgrade by signing a pre-accession pact with the EU -- also to be announced at the June summit.
The deal was hailed around Europe, with the Vienna-based Organisation for Security and Cooperation in Europe saluting a "courageous accord" that marked "the beginning of a new chapter".
"I commend the leadership in Belgrade and Pristina for their courage and vision in reaching this agreement," said Leonid Kozhara, chairperson of the international monitoring body and Ukrainian foreign minister.
Austrian Foreign Minister Michael Spindelegger said the accord was a "win-win" solution for all.
Ashton's office would not publish the 15-point text which focuses on how much autonomy to give ethnic Serbs in Kosovo who refuse to recognise Pristina's authority.
Thaci said there would be further examination of the terms and the Serbian government website said it would respond formally to the initialled agreement by Monday.
While there has been considerable progress in the two years of talks to reduce tensions, a deal got stuck on the fate of 40,000 ethnic Serbs in north Kosovo who refuse to recognise Pristina's authority and have set up their own "parallel" structures.
Serbia wanted Kosovo to agree to decentralised Serb "municipalities" in the northern enclave with their own police and courts to guarantee ethnic Serbs fair representation in Kosovo.
But Pristina was wary of Belgrade meddling in Kosovo affairs through the Serb community and refused to see "a state within a state" in its north.
Serbian media said Wednesday that the EU was offering a compromise in which the northern Serbs would be guaranteed a fair share of regional and local police chiefs as well as the presidency of a regional court.
The EU offer suggested NATO be put in charge of supervising security, media said.
Serbia continues to refuse to recognise Kosovo's independence, even though more than 90 countries have done so, including the United States and all but five EU member states.
The two premiers later met NATO chief Anders Fogh Rasmussen, who said the alliance stood ready to help implement the accord.
"I am very happy for NATO to contribute to the conclusion of an historic agreement," he said. "NATO will continue to ensure a safe and secure environment throughout Kosovo."
NATO intervened in the breakaway province of Kosovo in 1999 to force the withdrawal of Serb forces and once that was achieved, set up the KFOR force, now reduced to some 5,000 troops, to ensure security.