Serb collapse puts peace plan in jeopardy

Bosnia turning point: Offensive in west means Croats and Muslims now hold half the country

EMMA DALY

Sarajevo

The Bosnian government forces and their Croat allies now control half the country, after their huge offensive this month, the UN confirmed last night. Their threat to the rebel Serb stronghold of Banja Luka is prompting diplomatic alarm that the advance could disrupt the delicate dance towards a settlement of the conflict.

The government yesterday proposed "political dialogue" with local Serbs to avert a battle for Banja Luka - a suggestion that is unlikely to win Serb support unless citizens there fear imminent and total defeat, but one which neatly subverts international concern about an attack on the city.

The Bosnian Foreign Minister, Mohamed Sacirbey, also rejected calls by mediators for a nationwide cessation of hostilities: "A cease-fire that allows the Serb military and paramilitaries to retrench would be counter- productive to the peace process," he said - especially as the government feels, for the first time, that it is winning.

The proportion of territory held by the Bosnian Serbs has dropped dramatically from around 70 per cent at the time of the Geneva meeting 11 days ago to 50 per cent and falling fast, a UN spokesman said. "It's about 50-50 and going the other way," Lieutenant-Colonel Chris Vernon said. "And that's a cautious estimate."

Amid Serb claims of a counter-attack in the area, there were reports that the Croatian forces - whose artillery is vital to any Bosnian assault, and whose officials have made covetous remarks about Banja Luka - had halted attacks in the region.

"We have proposed that the Bosnia government would be prepared to engage in political dialogue with responsible leaders in the Banja Luka region, to allow Serbs to stay in their homes and not have Banja Luka become a battle-ground," Mr Sacirbey said yesterday. He gave no real details, but denied the suggestion was surrender by another name.

Malcolm Rifkind, his British counterpart, in Sarajevo yesterday, responded enthusiastically. The Bosnian objective, he had been assured, "was to avoid an attack on Banja Luka" and a subsequent "massive humanitarian crisis". (Mr Rifkind was not the object of a sniper near-miss, despite press reports by London-based correspondents who misinterpreted the usual city gunfire as a possible assassination attempt.)

The proposal is clearly aimed at exploiting old rivalries between Banja Luka and Pale, where power is concentrated in the hands of the Bosnian Serb President, Radovan Karadzic. But it is also an attempt to circumvent the Geneva declaration, which foresaw two political "entities", one Serb, one not, within the Bosnian state.

A Banja Luka model in which the central government demanded the removal of Serb military forces, then magnanimously ceded some control to local Serbs, would go a long way to extending Sarajevo's influence beyond the lands it holds. For that reason its creation is unlikely, unless to stave off imminent Serb defeat, or as a way for Banja Luka politicians to cast off Pale's shackles in the hope of a better deal with Sarajevo.

But the proposal also emphasises the Bosnian government's credibility as the guardian of a liberal, tolerant and multi-ethnic society. It also offers an excuse for inaction, should the Croats withdraw support, or press on alone.

Relations between the forces of Sarajevo and Zagreb are workmanlike rather than warm, and there were reports last night that Croatian troops were blocking the advance south and east of government forces from Bihac. The Bosnian and Croatian presidents are to meet in Zagreb today, under the auspices of the US negotiator, Richard Holbrooke, to discuss Muslim- Croat links in Bosnia.

The government army could not even dream of taking Banja Luka without support from the Croatian army, but would be loath to see more of its territory consumed by Zagreb's troops.

It is by no means clear the allies are yet in a position to take Banja Luka. If they are, they appear to be under severe international pressure to desist. If they do attack, they risk retribution in Sarajevo, where the Serbs will be allowed to retain some small artillery pieces.