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Ivica Dacic and Zoran Milanovic agreed that the two countries must normalise relations, address unresolved wartime issues and improve economic cooperation.
At their first official meeting on Wednesday, Dacic and Milanovic said that Serbia and Croatia should take steps to address the currently tense relationship between the two countries.
“There are some issues where our stances differ, some issues are emotional, but we are aware that we need to cooperate and that it is unacceptable for two neighbouring countries to have unresolved relations,” said Dacic.
“We cannot change the past, but we can change the present and the future,” he said.
Dacic also said that mutual disputes should be resolved.
“None of the unresolved issues are new – the issue of displaced persons and refugees, the prosecution of war criminals, establishing borders and mutual lawsuits,” said Dacic.
Croatia filed a genocide lawsuit against Serbia at the International Court of Justice in 1999, and after Zagreb declined requests to withdraw it, Belgrade filed a countersuit in 2010.
The prime ministers agreed that the two countries should improve trade links and that Croatia would support Serbia’s EU aspirations.
"Croatia supports Serbia on its EU integration path,” said Milanovic, explaining that membership for Belgrade was also in Zagreb's interests.
Croatia is due to join the EU in July, while Serbia is hoping to obtain a date to open membership talks this year.
This was Milanovic’s first official visit to Belgrade since he became prime minister in 2011 and after the ties between two countries deteriorated following the election of a new government in Serbia last May.
Relations have been chilly since a more nationalist coalition replaced the centrist Democratic Party-led government in Serbia.
Serbia's new government is made up of the Serbian Progressive Party, Dacic's Socialists and the United Regions of Serbia.
Croatia's President Ivo Josipovic did not attend the inauguration of his Serbian counterpart, Tomislav Nikolic, after the latter appeared to express support for a "greater Serbia".
Relations also worsened after the International Criminal Tribunal for the Former Yugoslavia, ICTY, acquitted two Croatian wartime generals last November.
Both countries have called for an easing of tensions but Nikolic on Wednesday accused his Croatian counterpart Ivo Josipovic of avoiding face-to-face talks.
“The meeting of two presidents indicates a thaw in relations and the establishment of good relations and I do not know why Ivo Josipovic is avoiding this encounter. I represent the country and its citizens at home and abroad,” B92 quoted Nikolic as saying.
Croatia's Zoran Milanovic will arrive in Belgrade on Wednesday on a visit aimed at improving the currently tense relations between the two countries.
The Serbian paramilitary who became a key prosecution witness at his former comrades’ trial for war crimes in Kosovo says he had to speak out about the brutal massacres his unit committed.