The meeting started after the text of a draft UN resolution mandating a Kosovo peacekeeping force was agreed by ministers from the leading industrialised nations and Russia.

The deal was struck during a second day of talks in Germany and was given its first consideration by the UN Security Council.

Ben Brown in Macedonia: Peace is still on hold

General Michael Jackson and Yugoslav generals gathered late on Tuesday at Kumanovo, a French military installation in Macedonia.

But as dawn broke on Wednesday there was no sign of movement towards signing the document outlining the logistics of a Yugoslav military and security withdrawal.

There was a break after three hours when the head of the Yugoslav delegation, General Svetozar Marjanovic, and two other officers left Kumanovo for the Yugoslav border - about six miles away - to confer with higher authorities, Nato officials said.

They returned after just over an hour.

George Eykyn reports from the marathon talks between the Nato and Yugoslav generals

The official Yugoslav news agency Tanjug said the meeting was "important" because it would prevent a security vacuum in Kosovo "in which Serbs living in Kosovo would be endangered".

Correspondents say that appeared to indicate Yugoslav concerns that the rebel Kosovo Liberation Army would try to fill the vacuum left by departing Serb forces before Nato troops arrived.

'Real breakthrough'

At the end of the G8 discussions, the German Foreign Minister, Joschka Fischer, said: "We have managed to unite on an agreement. We have managed to achieve a real breakthrough."

Mr Fischer told a news conference that the deal would lead to a halt in bombing and a "robust peace group" would be put in place.

There has been no formal reaction yet from Yugoslavia.

The draft resolution says the international force for Kosovo will have a unified command structure and it calls on all parties to co-operate with the war crimes tribunal that has indicted Yugoslav President Slobodan Milosevic - key Nato demands.

The BBC's Brian Hanrahan: "Their unity is a lever that will force Milosevic to give way"

But even as the G8 foreign ministers were putting on a united front, differences were appearing.

When asked who would lead the international presence in Kosovo US Secretary of State Madeleine Albright said Nato was both at the core of the force and its military leader.

Russia's Foreign Minister, Igor Ivanov, said that was still the subject of negotiation.

But BBC Diplomatic Correspondent William Horsley said it was clear Nato had won the diplomatic battle "strongly and completely" and that Russia had agreed to Nato's terms.

The draft UN resolution allows Serbia to maintain a presence on its Kosovo borders, but not to have any influence over who is allowed to enter the province.

At the White House, President Bill Clinton said: "The key now is implementation. A verifiable withdrawal of Serb forces will allow us to suspend the bombing and go forward."

The BBC's John Simpson: "All this to force an agreement which Milosevic could of had in March"

Russian Defence Minister Igor Sergeyev said Moscow was preparing to send up to 10,000 troops into Kosovo. He added that they would not be under Nato command.

President Yeltsin is reported to have discussed the deal by phone first with his Chinese counterpart Jiang Zemin, and then President Clinton.

KLA truce promised

Hashim Thaci, the political leader of the Kosovo Liberation Army, says the rebel group is ready to publicly pledge that it will not attack Serb troops leaving the province.

Border fighting

Nato air attacks have gathered pace again following a lull in the days after President Slobodan Milosevic first signalled his intention to agree to a peace deal.

(Click here to see a map of last night's Nato strikes)

Huge palls of smoke and flames rose from Serbian oil refineries early on Tuesday after they were attacked, and explosions were heard in central Belgrade for the first time in several days.

Serbian local radio said the huge oil refinery at Pancevo near Belgrade was bombed. Residents in the centre of the capital heard intense anti-aircraft fire and several explosions.

Two missiles hit civilian houses in Belgrade suburbs without exploding or without causing casualties, the official Yugoslav news agency Tanjug said.

Yugoslav media also reported that fires raged at a major refinery in the northern city of Novi Sad after it was bombed around midnight, killing one civilian and wounding five.

• Main points of the draft resolution
• KLA 'ready to guarantee Serb safety'
• Hiding in the hills
• Russia and China 'discuss Kosovo peace'
• Blair: Nato could enter Kosovo in days