Philippines in 'separatist deal'

The borders deal caps four years of negotiations amid a fragile truce

The Philippines government says it has reached an agreement with the country's main Islamic separatist group on boundaries for a Muslim homeland.

Government negotiator Rodolfo Garcia said "demarcation" was agreed after two days of talks in Malaysia with the Moro Islamic Liberation Front (MILF).

Officials say the deal in Kuala Lumpur could pave the way for a final peace deal between the two sides next year.

MILF has been fighting for decades over land in the southern Mindanao region.

Negotiators are hopeful that a permanent peace agreement can be sealed by the middle of next year.

Guide to Philippines conflict

The two sides did not disclose the shape of the new agreed borders, but the talks' Malaysian hosts said the territory would be greater than the present autonomous region in Mindanao.

Mr Garcia said the borders agreement was a "significant breakthrough".

MILF chief negotiator Mohagher Iqbal told the AFP news agency his side hoped "to find closure to the centuries-old problem in Mindanao which various regimes in Manila have not solved".

Formal talks began in 2003 after MILF, which is thought to have around 12,000 members, signed a fragile truce with President Gloria Arroyo's government.

It is the largest of several Muslim separatist groups battling the government in the predominantly Catholic country.

Analysts say the Philippine and US governments hope a peace settlement with MILF could stop the Mindanao region becoming a base for militants linked to al-Qaeda.