Seated from left, Serbian President Slobodan Milosevic, Croat President Franjo Tudjman and Bosnian President Alija Izetbegovic with the freshly-signed Dayton Peace Agreement in Paris in 1995.

The US-sponsored peace deal that ended war in Bosnia in the 1990s is at risk of unraveling unless the international community takes measures to stop Serb separatists, a peace envoy warned in a report to the United Nations seen by Reuters on Tuesday.

In his first report in the capacity of the international community’s High Representative in Bosnia, German politician Christian Schmidt said that Bosnia was facing the greatest threat to its existence since the war.

“The prospects for further division and conflict are very real,” Schmidt wrote.

He was referring to moves by the Bosnian Serb separatist leadership aimed at undoing key state institutions such as the joint armed forces, the indirect taxation authority and the top judicial body, as well as other institutions.

“This is tantamount to secession without proclaiming it,” Schmidt said in the report to the 15-member Security Council which is due to meet this week to discuss Bosnia and reauthorize the European Union-led peacekeeping force EUFOR.

The 1995 Dayton peace agreement ended the three-and-a-half-year war among Bosnian Serbs, Croats and Bosniaks by splitting the country along ethnic lines into two autonomous regions – the Serb-dominated Serb Republic and the Federation shared by Croats and Bosniaks.

The two regions are linked via central government which has been strengthened through rulings of international envoys over years to make Bosnia a functional state with institutions that can lead it to the European Union and NATO.

Schmidt said the unilateral withdrawal of either entity from the established state institutions was not legally possible under the current constitutional framework and would undermine the state’s ability to function.

He said that the EUFOR, which is now 600-man strong, is key for future stability, warning that in case the Serbs go on to pull out from the joint armed forces and create their own the mission should be expanded.

The Bosnian Serbs, supported by Russia and China, do not recognize Schmidt as the High Representative because his appointment was not approved in the UN Security Council.