Western leaders have moved fast to begin the huge job of reconstructing the Balkans, but the arguments over who is to foot the bill show no signs of receding.

The damage caused by the war in Kosovo to the regional economy is enormous.

The European Commission has estimated that the reconstruction of Kosovo alone will cost $18bn.

In Yugoslavia itself, repairing vital infrastructure is high on the agenda.

But Western leaders have made it clear that financial assistance for Serbia will only be given if President Slobodan Milosevic is no longer in power.

More than 50 Serbian road and rail bridges were destroyed by Nato.

Alliance air strikes also targeted oil refineries, and 28 fuel storage sites were attacked.

The war brought widespread economic damage

In Montenegro, Serbia's junior partner in the Yugoslav Federation, the damage was lighter.

Anxious not to destabilise a more conciliatory government in Podgorica, Nato planners limited their attacks to Yugoslav military positions, especially around the capital's airport.

The wider Balkan region has been badly affected by the conflict in many ways.

Most trade routes pass through Yugoslavia, in many cases along the River Danube. Air freight routes and lorry transport corridors have also been badly interrupted.

EBRD President Horst Koehler: "Only with reconstruction can future conflict be avoided"

An estimated 5% has been knocked off the output of countries in the affected area. This, in turn, leads to a large trade imbalance - estimated at nearly $2bn.

In addition, neighbouring countries - especially Albania and the Former Yugoslav Republic of Macedonia - have had to accommodate hundreds of thousands of Kosovo Albanian refugees.

Horst Koehler, the president of the European Bank of Reconstruction and Development (EBRD), told the BBC that people in the Balkans need to know they have "a place to live in peace and where they will have a job".

"Only then," he said, "will the potential for further conflicts be contained."

So who will pay ?

After the G8 summit in Cologne in mid-June, European delegates were hinting strongly that the United States - which is enjoying a huge budget surplus - should bear the brunt.

Ruined streets in Pristina

But President Clinton stated quite explicitly that he expects Europe to pick up most of the tab.

Washington, he said, had done its share in providing two-thirds of the aircraft and all the cruise missiles for Nato's 78-day air war.

At about $100m a day, that comes to more than $7bn.

The Milosevic factor

Many Nato politicians - including Mr Clinton - have ruled out substantial cash for Serbia until President Milosevic is removed from power.

Shortly before the G8 summit, French Prime Minister Lionel Jospin drew a distinction between humanitarian assistance and development aid.

Serbian power stations fell victim to Nato strikes

"A humanitarian policy for Serbia is necessary and justified," he said, "but as for reconstruction, we need an interlocutor of a different nature" from Mr Milosevic.

His comments echoed remarks by President Chirac that there could be "no development aid for a regime which is not democratic".

Two weeks ago, the US Senate Appropriations Committee approve a bill targeting about $535m for the Balkan region - but none of it for Serbia.

Republicans in Washington want the bill to include a reference to Serbia as a "terrorist state", which would make it ineligible for future US aid.

The price of peacekeeping

One major additional expense will be the peacekeeping operation itself, both military and civilian.

Given the extended period for which it is likely to remain in place, some analysts argue that peacekeeping could prove even more expensive than the war.