Serbian President Aleksandar Vučić and Kosovo Prime Minister Albin Kurti were accompanied by EU foreign affairs envoy Josep Borrell and the union's Balkan special envoy Miroslav Lajčák.

"The eyes of the EU and the Western Balkans are on Ohrid today," Borrell tweeted.

Kosovo, which today is almost exclusively inhabited by Albanians, seceded from Serbia in 1999 with NATO support and declared itself independent in 2008, although it remains unrecognized by Serbia.

The agreement under discussion envisages that Belgrade will not recognize Kosovo under international law, but will take note of the statehood of its former province.

In particular, Serbia should recognize Kosovo's passports, licence plates and customs documents, which it has not done to date. Kosovo, in turn, will be bound to institutionally secure the rights of ethnic Serbs in the country.

At a first meeting on Feb. 27, both sides verbally agreed in principle to a draft agreement presented by the EU.

Saturday's EU-mediated negotiations were to focus on concrete deadlines and dates to implement the individual points of the agreement. Borrell aimed to reach a comprehensive agreement before the EU summit due to take place next week in Brussels.

The US special envoy for south-eastern Europe, Gabriel Escobar, was attending the meeting as an observer. He was more modest in his expectations. He predicted that an agreement would be reached by the end of the year, in an interview with Radio Free Europe.

For nationalist Vučić, any softening of the tough stance towards Pristina represents a political risk. Before Saturday's meeting, he had repeatedly declared in Serbia: "I haven't signed anything and I won't sign anything."

For his part, Kurti is under pressure from a Kosovo Albanian population and electorate that is hostile to concessions to the Serbs.

The EU and US expect him to implement a 2013 agreement that calls for the creation of an Association of Serb Municipalities that is supposed to protect the interests and rights of Serbs in Kosovo.

In Kosovo, there are fears that such an organization, if given too much power, could undermine political stability and thwart state policies.

Kosovo remembers the oppression by Serbian security forces when the territory was still part of Serbia. An armed uprising by Kosovo Albanians resulted in even more widespread human rights violations by Serbia in 1998 and 1999. NATO responded by bombing what was then the rest of Yugoslavia — today's Serbia and Montenegro — in the spring of 1999.

Serbia subsequently had to withdraw completely from the province.

From 1999 to 2008, Kosovo was put under UN administration.

In 2008, the country declared itself independent. More than 100 countries have recognized Kosovo's independence – but five EU member states, including Spain and Greece, have not.

The relationship of Europe's newest state with Serbia has remained at an impasse for years.

Diplomatic efforts by the West have not led to any significant normalization of ties. Tensions escalated again last year, when road blocks were erected at border crossings.

Against the backdrop of Russia's unprovoked war against Ukraine, the settlement of the Kosovo conflict has regained importance for the West.

Moscow is seen to be exploiting weaknesses in the political order of various Balkan states in an effort to gain influence.

For instance, Belgrade is dependent on Russia because Moscow is using its veto in the UN Security Council to prevent Kosovo's admission to the United Nations.

Serbia is the only country in the region that does not support Western sanctions against Russia.