Balkans accord spells the end for Yugoslavia

The Federal Republic of Yugoslavia was consigned to the history books yesterday – and renamed "Serbia and Montenegro" – after a diplomatic deal brokered by the European Union averted the threat of a split.

The agreement, signed in Belgrade, is a considerable coup for the EU, which has battled hard to prevent the secession of Montenegro, fearing that would plunge the region into renewed conflict. Under the deal Serbia and Montenegro will be semi-independent states sharing defence and foreign policy, at least for now. The Montenegrin capital, Podgorica, will, however, have considerable autonomy, running a separate economy, currency and customs service.

The accord means the demise of a nation born in 1919 and is an important fillip for the EU's Balkan policy. Javier Solana, the EU high representative for foreign affairs, had fought off the threat of Montenegrin secession because of the potential for that to destabilise the region.

Such a move by Montenegro would have encouraged Kosovo's aspirations for autonomy. The prospect of joining an independent Kosovo might, in turn, have roused Macedonia's ethnic Albanian minority to try to secede. Instead both Serbia and Montenegro have been lured by the prospect of a new fast track to reintegration into the international community.

Mr Solana said the deal marked an "important step forward for the stability of the region and Europe", and promised this was "not an end of anything, but the beginning of a new chapter that we will write together and bring you to the membership of the EU".

To underline the point both the Yugoslav President, Vojislav Kostunica, and his Montenegrin counterpart, Milo Djukanovic, will join EU leaders at their two-day summit in Barcelona, which starts today. Mr Kostunica will remain federal President and the new country will have one seat in the United Nations with Montenegrin and Serbian officials rotating as envoys. According to a draft of the agreement both Serbia and Montenegro will be entitled to abandon the new accord after three years.

The document has to be approved by all the three parliaments – Yugoslav, Serbian and Montenegrin. But analysts agree this is the first time in recent Balkans history that the country known as Yugoslavia has gone out of existence without the bloodshed and misery of the area in the decade of Slobodan Milosevic's rule.