Yeltsin, left, and Schroeder on the last day of the G-8 summit
MILITARY PLAN:  ALSO: Kosovo rebels agree to demilitarize U.S. officials upbeat after Clinton-Yeltsin meeting India captures outpost in Kashmir, as G-8 urges cease-fire G-8 pushes Mideast peace, as Barak moves closer to coalition  MESSAGE BOARD: Focus on Kosovo  IN-DEPTH SPECIAL: Focus on Kosovo

June 20, 1999
Web posted at: 7:25 p.m. EDT (2325 GMT)

In this story: Humanitarian vs. reconstruction assistance Russia an 'equal' among 'friends' RELATED STORIES, SITES

COLOGNE, Germany (CNN) -- Leaders of the world's economic powers on Sunday pledged "strong action" to stabilize Yugoslavia's war-torn Kosovo province, but serious questions remained as to who would pay for what.

U.S. officials said European nations should assume most of the cost since the United States paid for most of the 11-week NATO air offensive against Yugoslavia that ended in early June when Belgrade agreed to a peace accord.

That position worries other G-8 countries.

"We'll pay. That's true," French President Jacques Chirac said. "But I can't imagine the Americans would just look at that and not have participation."

Humanitarian vs. reconstruction assistance

Another vital question concerns which projects the G-8 would finance as part of the reconstruction. The United States had wanted to limit aid to Kosovo -- excluding the rest of Yugoslavia -- as long as Yugoslav President Slobodan Milosevic remained in power.

But the communiqué issued by the Group of Eight on Sunday required a consensus, and Russia blocked the exclusionary language.

Still, German Chancellor Gerhard Schroeder said the G-8 opposed funds for reconstruction until Yugoslavia dumps Milosevic and endorses democracy. He made a distinction between reconstruction aid and humanitarian aid, however.

"Reconstruction aid, re-establishment of economic structures and reincorporation into Europe need democratization, and that is not possible with Milosevic," Schroeder said.

Milosevic, president of Yugoslavia since 1987, has been indicted on charges of war crimes by the international war crimes tribunal due to reported atrocities committed by Serbian forces in the ethnic Albanian-dominated Kosovo province.

Schroeder said that humanitarian aid -- which could include money to restart power plants to provide heat and water to Yugoslav citizens -- would not be denied to Serbs because of the actions of their president.

"Because they have Milosevic as their president, we should let them starve or let them freeze? That cannot be right," he said.

Chirac suggested that the G-8 consider rebuilding power plants on a case-by-case basis.

"Are the electric plants humanitarian? Maybe, not all of them," he said on CNN's "Late Edition."

To discuss the aid plan, Schroeder said he would convene a conference in the Balkans for the economic powers.

Russia an 'equal' among 'friends'

Yeltsin and his wife Naina arrive in Cologne on Sunday

Russian Prime Minister Sergei Stepashin, who represented Russia the first two days of the G-8 summit, said Sunday that Russia had achieved full equality in the Group of Eight.

"The truth was reaffirmed that Russia is not only an equal G- 8 member, but a major nation in the international and European economy," he told reporters.

Russia, though plagued by serious economic troubles, was formally admitted to the club of most of the world's richest nations last year.

Russian President Boris Yeltsin was in Cologne on Sunday for the final day of the three-day summit.

Yeltsin declared he was "among my friends now," despite hard feelings between the West and Russia over Kosovo.

"The most important thing is to mend ties after a fight," said the president, who later met with U.S. President Bill Clinton for the first time since the NATO bombing campaign.

Clinton and Yeltsin used the meeting to smooth relations roughed up by the Kosovo conflict, and to discuss weapons reduction.

The Kosovo crisis dominated the previously scheduled G-8 summit, but the economic leaders managed to deal with several other issues in their final communique. Among those was an agreement to help Russia deal with crippling Soviet-era debt as long as Moscow remains committed to economic reform.

The G-8 also agreed to drop about $90 billion in debt on its books owed by some of the world's poorest countries.

Moscow Bureau Chief Jill Dougherty, White House Correspondent John King and Reuters contributed to this report.

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