The Noumea accord, which takes its name from the main island's capital, could eventually lead to complete independence for the Pacific islands after 150 years of French control.

Lionel Jospin speaking at the signing ceremony - in French (0' 52")

France views New Caledonia - which contains about 30% of the world's nickel reserves - as a strategic political and economic asset in the region.

The accord allows the archipelago greater autonomy during a 15-20 year transition period before a referendum on self-determination is held.

French PM Lionel Jospin between pro-independence leader Roch Wamytan, (left) and conservative leader Jacques Lafleur

The New Caledonians will vote on independence some time between the years 2013 and 2018.

Leaders of New Caledonia's rival separatist and pro-French groups have also signed the document, drawn up in Paris on April 21.

Party to the agreement were Jacques LaFleur, leader of the anti-independence Rally for Caledonia in the Republic party (RPCR) and Roch Wamytan, of the pro-independence Kanak and Socialist National Liberation Front party (FLNKS).

The accord was also signed by the French Secretary of State for Overseas Territories, Jean-Jack Queyranne.

New Caledonia has "crossed a new step" in its political development, said Mr Jospin after the signing ceremony.

For the last 10 years, New Caledonia has periodically erupted in violence between pro-independence indigenous Kanak people and anti-independence settlers who were originally from France.

Speaking after signing the agreement in the Pacific territory's capital Noumea, Mr Jospin added that the parties would also have to trust one another and called for an end to prejudice between different cultures.