After surviving the bloodiest war in the Balkans in the 1990s, Bosnians now fear their country risks slowly tearing itself apart while its neighbours advance towards European integration. “They will never agree on anything,” said Maja Glisic, a 42-year-old engineer, watching a TV broadcast of a national parliament session in which Serb and Muslim deputies traded accusations and threats while debating next year's budget. The budget is vital to get badly needed IMF cash to support the country in the global economic crisis, but Serb lawmakers rejected it this week, offended that Muslim and Croat members of the country's collective presidency outvoted their Serb colleague to allocate more money for the return of refugees. Endless ethnic and political quarrels in the past three years have led Bosnia to a state of permanent political crisis, putting any hope of joining the European Union and NATO on the backburner. Alarmed by the political stalemate, senior Western officials tried to persuade feuding local politicians in two rounds of talks in the autumn to accept a package of reforms, dangling the carrot of a fast track to Euro-Atlantic integration. But nearly all the leaders rejected the constitutional reform plan offered by Swedish Foreign Minister Carl Bildt and US Deputy Secretary of State James Steinberg, saying it ran counter to their vital ethnic and regional interests. “An agreement could have been reached if there had been the willingness,” said Mladen Ivanic, a Bosnian Serb opposition leader who attended the talks, noting that the proposals were modest and could easily have been accepted. “If they had agreed, we could have got EU candidate status already next year,” Ivanic said. “The only reasonable premise is to find common ground. But unfortunately, there is no will.” The first effect of the failed talks followed swiftly. Unlike Montenegro, Bosnia was denied an invitation to NATO's Membership Action Plan this month. NATO officials said the country first needed to progress on reforms. Bosnia's neighbors, all former republics of Yugoslavia, have each made some progress towards Euro-Atlantic integration. Croatia, which is closest to EU membership, joined NATO along with Albania this year. The European Union lifted visa requirements for Serbia, Montenegro and Macedonia this month and Serbia plans to apply for the EU membership soon after Brussels agreed to unfreeze a trade agreement with Belgrade. Only Bosnia and Albania are still subject to a visa regime. Albania is generally seen as more eager to reform and get rid of its image as a Balkan backwater, earned under the rule of late communist dictator Enver Hoxha. “Bosnia is coming ever closer to replacing Albania as the metaphor for international isolation and lack of a perspective as a result of suicidal domestic politics,” columnist Ivan Lovrenovic wrote in the magazine Dani this month. Stagnation or worse? US-led international intervention ended the devastating 1992-95 war but left Bosnia with a dysfunctional political structure, splitting the country into two autonomous regions linked via a weak central government. “A state constructed like this is incapable of leading the country forward,” said Nerzuk Curak, who teaches political science at Sarajevo University. “The structure of the state makes compromise impossible.” After the first decade of post-war recovery fuelled by generous foreign aid, the international community had planned an exit strategy, hoping that domestic leaders would take ownership of the country under its guidance and assistance. But worsening rivalry between the Muslim-Croat federation and the Serb Republic forced international sponsors to stay on. Bosnia's international peace envoy this week overruled the national parliament and extended the mandate of foreign lawyers at the war crimes chamber before it expired at the end of December. Bosnian Serbs immediately denounced his ruling and threatened to call a referendum on the issue. Many fear Bosnia may eventually collapse, torn between separatist Serbs who obstruct parliament and threaten to secede, Croats who are unhappy at being the smallest and least influential group, and majority Muslims who want a stronger central government. “I say stagnation is the scenario but of course it could be worse than that,” US Assistant Secretary of State Philip Gordon said in an interview with the Sarajevo daily Dnevni Avaz. A general election scheduled for next October is likely to slow the reform process further, with politicians seeking votes by the proven method of raising ethnic fears.