Bosnian-Croatian Talks Get Under Way in Washington : Diplomacy: On the table is a U.S.-backed proposal to create a Muslim-Croat state. But initial discussions produce no agreement.

Negotiators from Bosnia-Herzegovina and neighboring Croatia began talks Saturday on a U.S.-sponsored plan to end the Bosnian civil war and reported a promising start but no immediate results.

“There is a goodwill and a desire on both sides to make progress,” the prime minister of Bosnia’s Muslim-led government, Haris Silajdzic, said after a day of meetings at the State Department. “We hope we are on the right track.”

The talks included officials representing the Bosnian government, Bosnia’s minority of Roman Catholic Croats and the Croatian government--but not neighboring Serbia or the Bosnian Serbs who have seized more than two-thirds of Bosnian territory.

On the table is a U.S.-backed plan under which Bosnian Muslims and Bosnian Croats would create a joint multiethnic state in about half of the country, seek some kind of federation with the Bosnian Serbs and build an economic union with Croatia.

“It was a good, serious discussion--but no deal yet,” a senior State Department official said.

Croatian Foreign Minister Mate Granic, who led his country’s delegation, said there was “a really good atmosphere (and) serious negotiations.” Asked whether the talks will succeed, he replied: “It is impossible to tell now.”

Secretary of State Warren Christopher asked the parties to come to Washington to work on the proposal after the North Atlantic Treaty Organization succeeded in stopping the artillery shelling of Bosnia’s capital, Sarajevo.

“This is a very special moment; we need to build on the cease-fire and success we’ve had in Sarajevo,” Christopher told the negotiators Saturday, according to a spokesman.

Christopher and his aides believe that a Bosnian-Croatian deal could be the key to an overall peace in Bosnia, because it would strengthen the position of the Muslim-led Bosnian government in negotiations with the Serbs.

But the Washington talks must first resolve the basic issue that has already produced a year of bitter combat between Muslims and Croats: Will the Croats of Bosnia live in a Muslim-majority Bosnian state? Will they get a separate ministate? Or will they join the larger republic of Croatia next door?

Croatia’s president, Franjo Tudjman, has long sought to annex Croat-populated areas of Bosnia-Herzegovina. Many Bosnian Croats also support annexation, but not all do.

Bosnia’s government, which is led by Muslims but also includes some Croats and Serbs, rejects any partition of the republic.

The U.S.-backed proposal seeks to solve that dilemma through a complicated, three-step process. First the Muslims and Croats would join to create something diplomats call the “Bosnian Bicommunal Entity,” a federal state with as many as 10 county-sized “cantons.” The BBE, as negotiators call it for short, would cover about half of Bosnia’s prewar territory, including Sarajevo. It would have a Muslim majority but strong protection for its Croatian and Serbian minorities.

As a second step, the BBE would negotiate peace with the Bosnian Serbs and accept their rule over about half of Bosnia. The Muslim-led government insists that the two halves of the country must not be divided, but how they would be joined remains unclear.

Finally, as a third step, the Muslim-Croat BBE would join neighboring Croatia in an economic union with open borders but would remain a separate country--roughly the way the countries of Western Europe have joined in the European Union.

The Bosnian government has already accepted the basic proposal--but Croatia has wavered, U.S. officials said.

“It is really a moment of choice for Croatia,” one official said.

If Croatia supports the proposal, the United States will help mobilize Western economic aid for the Zagreb government, he said.

But if Croatia obstructs the U.S.-favored solution, the United States will consider seeking U.N. economic sanctions against the republic.

Officials said they expect the discussions to continue all day today and to conclude Monday morning.