The Union is determined to have a leading role in promoting stability, security and economic development in South-Eastern Europe in close partnership with the countries of the region and with others under the overall aegis of the Stability Pact. The European Council welcomes the joint report by the Presidency and the Commission emphasising key areas for future work. It invites the Secretary-General/High Representative, together with the Commission, to present to the Council for further urgent consideration a political and economic analysis of future prospects of the region. The European Council also underlines the need for a single regulatory framework for financial assistance which should contribute to more effective action on the ground and cooperation in the region. The European Council expresses its gratitude for the work being undertaken by Mr. Bodo Hombach.

The prospect of stabilisation and association agreements should enable closer relations to be developed between all of the states in the region in all areas. Support from the Union will depend on the clear and visible commitment of the states of South Eastern Europe to cooperate in order to achieve the common political priorities. The European Council stresses the major importance of improving relations and removing trade barriers and barriers to the movement of people between the countries concerned. It recalls the importance of rapid action on clearing the Danube.

The Union wishes to assist the democratisation of the Federal Republic of Yugoslavia (FRY) as part of its efforts to stabilise South-Eastern Europe. It will intensify dialogue with Serbian democratic forces, as well as the democratically elected government of Montenegro. The Union will pursue further ways of supporting Montenegro's political and economic reform programme.

The Union is committed to rehabilitation and reconstruction in Kosovo. It welcomes the Reconstruction and Recovery Programme for Kosovo and the Union's pledge of 500 million euros starting from year 2000 for reconstruction, in addition to the national contributions from the Member States. UN Security Council resolution 1244 must be fully implemented in all its aspects by all the parties. Non-compliance with UNMIK's mandate and lack of cooperation with KFOR will have serious consequences for the EU's commitment in Kosovo. In this context, the European Council expresses its gratitude for the work being undertaken by Mr. Bernard Kouchner.