Croatia regained control of the last Serb-held part of its territory on Thursday putting a symbolic end to the 1991-95 Croatian war.

Eastern Slavonia returned to Zagreb's control when the United Nations transitional administrator, William Walker, handed over a UN flag to Croatian presidential aide Hrvoje Sarinic.

The ceremony outside Vukovar

The handover, held in a former frontline village on the outskirts of the town of Vukovar, is vital to the ongoing peace process in the former Yugoslavia and marks a success for the UN transitional administration (UNTAES).

US envoy Robert Gelbard, attending the ceremony hailed the end of the UN mandate in Eastern Slavonia, and urged Zagreb to respect human rights and to continue with refugee return.

There are fears that extremists amongst returning Croats, many of whom were forcibly expelled during the war, will embark on human rights abuses of the remaining Serb population.

But Western diplomats say they believe President Tudjman will try to ensure equal treatment because if he doesn't, Croatia's attempts to be incorporated into European and international institutions will be delayed.

A spokesman for the UN High Commissioner for Refugees, Kris Janowski, said there had been concerns about the handover, but there had been no exodus of Serbs from Eastern Slavonia as expected.

Kris Janowski, UNHCR: "concern over takeover"

"Most of the Serbs remain in Eastern Slavonia and their own leaders are urging them to stay and trust the Croatian government. The onus is on the Croatian government. We have to see if the Croatians keep all their promises and fulfill the agreements they made."

According to UN estimates, the cost of reconstruction in Eastern Slavonia will be $1.2bn. But the region also has rich farmland, oil fields, direct access to the Danube and control over international road and rail links.
 

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