1. NATO's aim has been to contribute to international efforts to stop the humanitarian crisis in Kosovo, end the violence there and bring about a lasting political settlement. NATO's decisions in October made a crucial contribution to the withdrawal of forces of the Federal Republic of Yugoslavia (FRY) from Kosovo and helped to avert a humanitarian disaster. The Alliance's enhanced state of military readiness continues.

2. The security situation in Kosovo remains of great concern to us. Since the beginning of November, violent incidents provoked in some cases by Serbian security forces and in others by armed Kosovar elements have increased tension. These incidents show that both the Belgrade authorities and the armed Kosovar elements have failed to comply fully with the requirements set out in UN Security Council Resolutions 1160, 1199 and 1203. We call upon the armed Kosovar elements to cease and desist from provocative actions and we call upon the FRY and Serbian authorities to reduce the number and visibility of MUP special police in Kosovo and abstain from intimidating behaviour.

3. We will continue the Alliance's air verification mission, Operation "Eagle Eye", in accordance with the agreement between the FRY and NATO, and communicate periodically to the UN Secretary-General NATO's views on compliance.

4. The North Atlantic Council has authorised an Activation Order (ACTORD) for a NATO-led Extraction Force, Operation "Joint Guarantor". We will quickly deploy the standing elements of this force in the Former Yugoslav Republic of Macedonia to provide the ability to withdraw personnel of the OSCE KVM in an emergency. We greatly appreciate the cooperation and support of the authorities of the former Yugoslav Republic of Macedonia for providing facilities for the basing of NATO forces.

1. NATO continues to support the efforts of the international community to help Bosnia and Herzegovina develop as a single, democratic and multi-ethnic state. This remains achievable only through the full and unconditional implementation of the Peace Agreement in

Bosnia and Herzegovina, to which the Alliance is fully committed. SFOR continues to play a vital role in maintaining a secure environment in Bosnia and Herzegovina. We reaffirm our readiness to work constructively with all Parties that support the Peace Agreement and seek to implement it.

2. Much has been achieved over the past three years in the task of re-building Bosnia and Herzegovina. The September elections were an encouraging step in this direction; they were peaceful and democratic and demonstrated a trend towards greater pluralism and tolerance. Freedom of movement by and large exists; there is a common currency, a new flag and other necessary symbols of nationhood. We welcome the recent opening of Tuzla International Airport and the progress made in establishing normal civilian air traffic at Sarajevo and Mostar.

3. An accelerated return of refugees and displaced persons in particular to minority areas is a key task for 1999. We confirm that SFOR will continue, within means and capability, its efforts to contribute to conditions conducive to achieving this objective. We call on the Parties and the democratically elected representatives at all levels of government in Bosnia and Herzegovina to fulfil their responsibility to ensure an effective returns process.

4. We underline our full and continued support to the High Representative in his role of coordinating and guiding the strategy of the international community for civil implementation. We support his efforts to improve coordination and harmonise the different areas of responsibility of the various international organisations involved in the peace-building process in Bosnia and Herzegovina.

5. We noted with satisfaction the unique contribution of the NATO-led Stabilisation Force (SFOR) in providing, within its means and capabilities, broad support for civil implementation of the Peace Agreement of 1995. The Multinational Specialised Unit, which we created last May, enhances the effectiveness and flexibility of SFOR. We commend the men and women of SFOR for their outstanding service in the cause of peace. SFOR continues to make an important contribution to stability and peace in Bosnia and Herzegovina.

6. However, SFOR's presence cannot be maintained indefinitely nor does it reduce the responsibility of the authorities in Bosnia and Herzegovina to ensure the stability of their country, which is best secured through full implementation of the Peace Agreement. In reviewing the size and shape of SFOR, we have decided that, at present, there is no scope for major changes, nor should its mission be changed. We note, however, that there is scope for short-term efficiency measures. We have also endorsed the commissioning of a study of options for possible longer term and more substantial adjustments in the future size and structure of SFOR. Decisions on future reductions will be taken in the light of progress on implementation of the Peace Agreement.

7. We strongly support the continuing implementation of confidence-building measures at the local and regional level. We look forward to the beginning of arms control negotiations, as provided for in the Peace Agreement, with the goal of establishing a regional balance in and around the former Yugoslavia, including appropriate verification arrangements. We call on the Parties to commit themselves to the promotion of confidence and cooperation between their armed forces within the framework of the Standing Committee on Military Matters.

(NATO-statement M-NAC 2(98)142)