The creation of a Moslem-Croat republic is an admission of weakness by both parties in the face of Serb forces and the unwillingness of the United States and other Western powers to step in militarily.
For the Moslems, the agreement reflects acceptance after almost two years that Serb conquests cannot be rolled back by force. Repeated American warnings that the West would not militarily bolster the Moslems entered into the decision, Bosnian officials say.
For the Croats, recent reversals in their battles with the Moslems helped lead them to the negotiating table. Croatia, the military and political patron of Bosnia's Croats, also faces a Serb separatist threat. Germany, which has close historical ties to Croatia, warned that Croatian aspirations to join the West would be aborted if war continued.
The Moslem-Croat alliance is meant to focus diplomatic attention on the Serbs as holdouts. The Serbs control 70 percent of the country; the Clinton administration wants that reduced to about 50 percent by having the Serbs cede land to the Moslem-Croat federation.
The key to this ever happening is Russian pressure on the Serbs, say U.S. officials. "This will be a prime case of whether Russia is going to be cooperative on the international scene," an administration official said.
The Croats and Moslems, meanwhile, are to begin in Vienna this week to write a constitution for the rump Bosnian state. Their accord creates a federation under a single central government. This bi-communal Bosnia, in turn, is to ally itself with Croatia in a military and economic confederation.
Administration officials express satisfaction that the entity created by the Moslem and Croat agreement is at least binational, if not multiethnic; and if the Serbs refuse to go along, they will be made pariahs, at least by the West, with their conquests unrecognized under international law, State Department officials say.
The agreement, with U.S. participation, comes more than six months after Washington retreated from efforts to negotiate peace in Bosnia, offended by European refusal to back President Clinton's plan to exempt the Moslems from an international arms embargo against Yugoslavia and protect them with allied air power.
Administration officials are taking a philosophical view of the hiatus, during which war raged on in Bosnia. "Now we're making the best of a bad situation. At this point, the guns are silent and some reasonable arrangement is being worked out to stop slaughtering," said an administration official. "I've not heard anyone claiming a gold medal for this, but given where we were at even a month ago, we're happy to be getting even a bronze."
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