Fighting Slows in Bosnia, U.N. Officials Say : Balkans: Situation after cease-fire called ‘good’ everywhere except in Bihac pocket.

U.N. officials said Saturday that a cease-fire had slowed fighting across Bosnia except in the northwest enclave of Bihac, where Croatian Serbs and rebel Muslims were attacking government forces.

The United Nations hoped to build a peace settlement around the cease-fire, which went into effect at noon Saturday.

But Croatian Serbs and the rebel Muslim troops, who did not sign the cease-fire pact, pressed ahead with attacks on Bosnian government troops around the town of Velika Kladusa in the north of the Bihac enclave, a U.N. spokesman said.

Col. Gary Coward, military spokesman for the U.N. Protection Force, told reporters, “The situation throughout Bosnia, including Sarajevo, is good with one exception, which is Velika Kladusa.”

He said Croatian Serbs and Muslim rebels “continued with warring activities south of Kladusa. There were a few shells and significant small arms and heavy machine-gun fire.”

Edward Joseph, a U.N. spokesman in the Bihac pocket, said by telephone Saturday evening that the organized assault on Velika Kladusa had come from rebel Krajina Serb-held territory in Croatia.

“There has been a concerted attack from the territory controlled by the RSK,” the self-declared Republic of Serb Krajina, Joseph said, adding that it was unclear whether the forces involved were purely rebel Muslims.

The fighting had hampered the movement of a U.N. refugee agency aid convoy for the region, he said.

Bosnian Serb radio, quoting rebel Muslim radio, said the rebels were pressing south to “liberate the whole of western Bosnia” from the government army’s 5th Corps.

Sarajevo was peaceful despite three shots that rang out on the city’s notorious “sniper alley” seven minutes after the truce deadline but caused no casualties.

Bosnian Serb leader Radovan Karadzic and Bosnian President Alija Izetbegovic signed the seven-day cease-fire with the United Nations on Friday and agreed to negotiate a four-month “cessation of hostilities” by next Sunday.

If the cease-fire succeeds in halting almost 33 months of war, talks will resume on an international peace plan to divide the country between Serbs and a federation of Muslims and Croats.

A trail of broken cease-fires in the past prompted caution among the Contact Group of nations--the United States, Russia, Britain, France and Germany--promoting the plan.

The group said in a statement that talks would start only when the United Nations verified that the cease-fire was working and the Serbs accepted the peace plan as a starting point for negotiations.

The United Nations always knew the Bihac pocket was a weak link in the cease-fire based on mediation by former U.S. President Jimmy Carter, who was invited to Bosnia-Herzegovina by Karadzic last week in an effort to break months of deadlock in the peace process.

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The Muslim enclave of Bihac has been the scene of heavy fighting since October. Although Bosnian Serb army commander Gen. Ratko Mladic signed the cease-fire, the Croatian Serbs and rebel Muslim forces loyal to local businessman Fikret Abdic were not even invited to follow suit.

But Bihac is essentially a sideshow compared with the broader war and diplomatic struggle between Bosnian Serbs and Sarajevo’s Muslim-led government.

Karadzic ordered his forces to stop fighting Friday, and U.N. spokesman Thant Myint-U said there was “a dramatic drop in military activity throughout Bosnia (on Friday).”

The cease-fire agreement was boiled down to its essentials to remove issues over which the Serbs and Muslims have been wrangling for months.

These will be tackled as negotiators aim for a cessation of hostilities--under which U.N. peacekeepers will be deployed between the warring sides.

The issues include a Muslim withdrawal from the demilitarized zone on Mt. Igman west of Sarajevo, the demilitarization of Muslim enclaves in Bosnian Serb territory and the exchange of prisoners of war and information about missing people.