BERSERKISTAN

Berserkistan Navigator G7 Summit Could
Impose New Sanctions
Against Serbia

By Nicholas Doughty Diplomatic Correspondent

Protest Against G7 Summit LONDON, June 26 (Reuters) - Major powers could issue a formal threat to reimpose sanctions on Serbia and on the Bosnian Serbs at a summit starting on Thursday if Bosnian Serb leader Radovan Karadzic is not removed from power, Western diplomats said.

They told Reuterss that the summit in the French city of Lyon, including the five major powers who have coordinated policy on Bosnia, could threaten to take action as early as next week if Karadzic does not quit before then.

The United States, Russia, France, Germany and Britain are attending a summit of the Group of Seven (G7) rich industrialised nations. They now seem prepared to commit themselves to reimpose sanctions if needed. The hardline nationalist Karadzic, indicted by the U.N. war crimes tribunal in The Hague, has so far defied attempts to have him removed from power ahead of Bosnia's first post-war elections in September.

Washington and its allies have put pressure on Serbian President Slobodan Milosevic, former patron of the Bosnian Serbs, to oust Karadzic -- seen as a major obstacle to peace.

International peace coordinator Carl Bildt, who will come to Lyon on Friday, has been pushing hard for a firm signal from the summit, but diplomats said discussions were still going on over the terms to be used in the meeting's final statement.

"It is quite likely there will be a real, public threat from Lyon. Patience is running out," said one Western diplomat, who asked not to be identified.

Several options are being considerd, including selective reimposition of sanctions lifted after last November's Dayton peace agreement, perhaps starting with transport and sporting links. The major powers could also back a partial or complete reimposition of sanctions on the Bosnian Serbs alone.

Under the terms of the Bosnian peace deal, Bildt can recommend that all sanctions be reimposed on both the Bosnian Serbs and on rump Yugoslavia, which comprises Serbia and Montenegro.

But diplomats say they would rather, if possible, avoid this "nuclear option" which would ruin cooperation with Belgrade and sour the atmosphere ahead of the September 14 elections.

Any other option -- perhaps concentrating on the Bosnian Serbs alone -- would require fresh approval of the U.N. Security Council, on which Russia has a veto. Moscow has shown more sympathy for the Serbs than Western partners during the Yugoslav conflict and may block any efforts at a sensitive time in the Russian presidential elections.

"It's not in the bag yet because we have to make sure the Russians are on board," said another diplomat. "It will need very careful handling." However, the United States has made clear it wants Karadzic ousted by July 1 -- next Monday -- and diplomats say most allies agree the Lyon summit has to produce the prospect of real action.

Western countries have ruled out a manhunt for Karadzic by the NATO-led peace force in Bosnia, fearing that it would cause unrest and wreck the fragile peace. "We have to keep the pressure on and the threat of sanctions, in some form, is the only way to do it," said another diplomat.




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