BRUSSELS - Negotiators who have been trying for more than a year to form a government in Belgium announced Saturday they have reached a historic agreement on devolving power to the country's feuding regions.
Belgium has been without a permanent government for 482 days -- the lengthy negotiations are said to be a world record -- and the agreement on state reform will not by itself resolve the impasse. Negotiators still need to agree on next year's budget and the exact shape of the governing coalition.
But the agreement resolved a central issue that had divided the country's 5 million French speakers, who have sought to leave state institutions the way they are, and its 6 million Dutch speakers, who have insisted on more self-rule. Details are expected to be announced Tuesday, when the agreement will be presented to Parliament./p>
For many months, negotiations went nowhere, and many Belgians seemed blase about the need to bump along under a caretaker government. But more recently, financial pressure on the country has been growing, in part because investors have worried about a caretaker government's inability to undertake long-term planning.
Last week it emerged that the Franco-Belgian bank Dexia was in dire trouble and would likely need to be broken up, with the toxic assets -- totalling C$132 billion -- put in a "bad bank" supported with French and Belgian government funds.
Negotiators hope to have a permanent government in place before the next summit of European Union heads of government, which will be held in Brussels on Oct. 17 and 18.
