Pusic said in an interview with the Serbian daily Blic of Sunday that the two countries should at least try to find a solution to their mutual genocide lawsuits, filed with the International Court of Justice in The Hague, and reiterated that they must first and foremost deal with the issues of missing persons, looted property and war crimes.

In an interview with the Serbian daily Danas, published on Monday, Malovic described Pusic's statement as an extraordinary gesture and a message that Serbia and Croatia can deal with their outstanding issues through dialogue and in a friendly atmosphere.

Serbia will be absolutely constructive in dealing with the problems that burden the two countries, Malovic said, agreeing with Pusic that the conditions by both parties should be met. The reconciliation process cannot be completed until all disputes resulting from the unreasonable policy conducted in the 1990s have been settled, she added.

"The issues of missing persons and refugees, war crimes, looted property and tenancy rights must certainly be resolved and I am confident that neither Croatia, which is about to enter the European Union, nor Serbia, which aspires to it, want to carry the baggage of a dark past," Malovic said.

When asked if Serbia would withdraw its lawsuit if Croatia did the same, Malovic said it was irrelevant who would withdraw the lawsuit first and that it was a technical matter that would follow once a solution was found.

"What is important is to reach an agreement in the interests of citizens of both Serbia and Croatia. Then the withdrawal of the genocide lawsuits will be realistic in itself. The good news is that the subject has been broached and that good intentions have also been expressed in public by the presidents of the two countries, Boris Tadic and Ivo Josipovic," she said.