Both Sides See Talks Next Week as Best Chance for Peace in El Salvador : Central America: Government and guerrilla representatives will meet for 20 days in Mexico.

After 11 1/2 years of fighting to a stand-off, leaders of El Salvador’s leftist guerrillas and U.S.-backed armed forces are preparing for a new round of negotiations that both sides view as their best opportunity to end the war.

The U.N.-mediated talks set to begin Thursday in Mexico are a breakthrough in themselves. They are to center on a rebel proposal that, for the first time, concedes the possibility of a cease-fire before full agreement on political reforms.

In accepting the rebels’ proposed agenda, the government and the military agreed to work toward a cease-fire by negotiating a separation-of-forces accord that implicitly recognizes guerrilla domination over parts of the Central American country.

Anticipating substantial agreements, U.N. mediator Alvaro de Soto has scheduled 20 straight days of talks, the longest session since peace negotiations began in 1985.

“We have never been so objectively near to the threshold of peace,” auxiliary Archbishop Gregorio Rosa Chavez of San Salvador, said this week. “The month of April will be decisive.”

Fighting between the Farabundo Marti National Liberation Front and a series of centrist and rightist governments has taken an estimated 75,000 lives in a country of 5 million people and frustrated several mediation efforts.

The current talks, held each month since last May in Mexico or Costa Rica, have achieved one accord so far--to allow U.N. monitoring of human rights violations.

At the FMLN’s insistence, the two sides also agreed then that they should reach accord on reforms in five other areas--the constitution, the military, the judiciary, the electoral system and the economy--before a cease-fire. But the talks began to stall last August over how to reduce and reform the country’s powerful 57,000-member armed forces.

Peace prospects appeared to dim further last November when the rebels launched their largest offensive in a year, fortified with anti-aircraft missiles smuggled from Nicaragua. The shooting down Jan. 2 of a U.S. military helicopter and the killing by FMLN guerrillas of two American servicemen who survived the crash led President Bush to free $42.5 million in military aid previously frozen by Congress to protest the slayings of six Jesuit priests by the army in November, 1989.

Western diplomats in Central America now view the flare-up in fighting as a ritual test of strength before a decisive round of talks between two exhausted armies that know they cannot defeat each other. They say that U.S. pressure on the Salvadoran military to negotiate seriously and similar pressure by Central American governments on the guerrillas have narrowed some major differences.

Also favoring an agreement, the diplomats say, is that each side is convinced that peace would favor it politically. President Alfredo Cristiani’s right-wing government believes it would give his market-oriented economic policies time to pay off before the 1994 presidential elections; leftist parties close to the guerrillas feel that peace would ease the harassment of left-wing political activists by paramilitary squads.

“Nobody wants interminable armed confrontations,” the pro-government Salvadoran newspaper Prensa Grafica commented this week. “Nobody except maybe for those few who keep firing as if they don’t want to lose a single bullet of their dwindling ammunition.”

Signals of optimism about a breakthrough are coming from both sides.

“I am almost certain that this year will be the year of peace,” predicted Col. Innocente Montano, the Salvadoran vice minister of security, after reading the new rebel proposal.

Salvador Samayoa, a member of the FMLN’s diplomatic commission, said in an interview here this week: “I don’t have any doubt that the war is over. What we’re discussing now is how to clean it up. . . . More than ever before, international and internal political conditions favor a settlement.”

Since late 1989, when the guerrillas’ biggest offensive of the war failed to spark a popular uprising in El Salvador and Communist rule collapsed across Eastern Europe, FMLN leaders have disavowed their goal of taking power to impose a Marxist system. Their chief aim in the peace talks, they say, is to guarantee a chance to compete on fair terms in democratic civilian politics.

The guerrillas have been influenced in this conversion, Samayoa said, by the electoral defeat of their revolutionary Sandinista allies in Nicaragua and by the Sandinistas’ ability to survive as a strong opposition political force after giving up the government. The guerrillas’ belief in peaceful politics was strengthened, he added, by the respectable showing of two leftist parties in El Salvador’s March 10 legislative elections, the first wartime balloting not sabotaged by the rebels.

The rebels’ new proposal is aimed at speeding up negotiations. It calls for agreements on military and constitutional reform by April 30 and sets a May 30 goal for a cease-fire, whether or not there are full accords on other proposed reforms.

Under the proposed cease-fire, which would be enforced by U.N. peacekeeping troops, both armies would be restricted to small areas within their respective “zones of control” while the rest of the country was “demilitarized.” The rebels would hand in their weapons only after a full accord on all points of the agenda.

The deadline for agreement on constitutional issues is crucial because any amendments to the country’s 1983 charter must be ratified by two consecutive legislatures. The current National Assembly’s term expires April 30, and if that happens without a vote on the constitution, then any amendments would have to wait until after the next assembly elections in 1994.

Vice President Francisco Merino called the rebel initiative “a substantial advance.” Cristiani reacted more cautiously, saying he hopes that it means the FMLN has “changed its attitude” and is ready to “work seriously.” But aides said they had never seen the president so optimistic in private.

Gen. Rafael Villamariona, chief of the Salvadoran air force, rejected the rebel cease-fire proposal and said he would refuse any order to limit troop movements. But Col. Montano, apparently speaking for the more powerful army and signaling a more receptive attitude, said a cease-fire would have to mean giving the guerrillas “security zones” in areas where they are strongest, until a final peace accord.

In the talks starting next week, military officers on both sides are to decide on the shape of a cease-fire while political negotiations on military and constitutional reforms proceed in a separate room.

Western diplomats say the government and the rebels have narrowed their differences over reduction and reform of the military; the rebels, for example, no longer insist on its immediate abolition. But the two sides are still at odds over whether a proposed commission to weed human rights abusers from the armed forces would include military representatives.

The rebels seek to change constitutional clauses that make the military a co-equal branch of government and give it the right to judge civilian acts as unconstitutional. Other amendments would be required to put the police forces under civilian control, give leftist parties a voice on the Central Elections Commission and end constitutional limits on land redistribution.

Armando Calderon Sol, leader of the governing Nationalist Republican Alliance, said the party’s legislative bloc would not stand in the way of constitutional reform.