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ATHENS (Reuters) - Greece said on Thursday it and Macedonia hoped for progress in talks with a U.N. mediator on Jan. 17 towards settling a long-running dispute over the latter country's name that has held up Skopje's EU membership prospects.

Greek Foreign Minister Nikos Kotzias met his counterpart from the Former Yugoslav Republic of Macedonia (FYROM), the country's formal name, in the Greek city of Thessaloniki on Thursday after the two sides agreed to renew diplomatic efforts..

"The ministers expressed their common expectation for the presentation, at the upcoming meeting...(with) the U.N. envoy of an initial framework within which the process will move forward," a Greek Foreign Ministry statement said after the meeting.

"The two ministers discussed the methodology, the approach of the two sides and the framework concerning the name issue, while also agreed to take a more active role in discussions to overcome the difference on the name issue."

Athens has blocked Macedonia's attempts to join NATO and objects to its EU membership bid because it says the name Macedonia implies a territorial claim over Greece's own northerly region of that name.

Under a 1995 accord, Greece has only agreed that the country be referred to internationally as the Former Yugoslav Republic of Macedonia until the dispute is resolved.

Greeks are highly sensitive about the name issue and rallies are planned in northern Greece later in January against any compromise that might retain the name Macedonia.

But Athens sees a window of opportunity to settle the row following the election of a more moderate government in Skopje that appears more amenable to a deal.

(Reporting by Angeliki Koutantou; editing by Mark Heinrich)

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Reuters