The Greek Prime Minister, Mr Costas Simitis, and the Turkish Prime Minister, Mr Mesut Yilmaz, met on the sidelines of the Balkans summit in Crete yesterday for talks aimed at resolving tensions between the two countries. These have risen lately over the divisive issue of Cyprus and military and naval encounters in the Aegean where the two are carrying out separate, but concurrent, exercises.
A spokesman for the Turkish Foreign Ministry, Mr Neceti Utkan, said Turkey was ready to "resolve all problems by the means laid out in the UN charter, namely negotiations, including with third parties and arbitration".
Sources close to the summit hoped the meeting would resuscitate dialogue between the two neighbours after the failure of an informal US-brokered accord signed in Madrid in July.
A Greek official said Athens wanted to resolve its differences with Turkey "step by step", starting with the disputed small island of Imia.
Meanwhile, the Balkan leaders discussed new initiatives aimed at reinforcing stability in the region. Officials at the summit said each country proposed measures to end the current climate of uncertainty.
President Kiro Gligorov, of the Former Yugoslav Republic of Macedonia (FYROM), proposed setting up special "centres to prevent tensions", according to a Greek government spokesman, Mr Dimitris Reppas. Mr Yilmaz proposed regular three-monthly meetings among the region's foreign ministers. Greece was interested in creating a permanent secretariat to follow Balkan developments in co-operation.
Speaking at the opening of the two-day summit - at which Albania, Bosnia, Bulgaria, Macedonia, Romania and Yugoslavia are also represented - Mr Simitis said the conference should be aimed at "creating a Balkan space of peace and co-operation". Mr Pangalos announced that Turkey would host the next Balkan conference in October 1998.
A meeting between Mr Simitis and Mr Yilmaz failed to bring any breakthrough in relations.
Mr Simitis said after the talks both sides had repeated positions over issues such as Cyprus and territorial rights in the Aegean.