Security situation relatively stable since signing of February 2002 ceasefire, but political killings increasing in north and east. Government has said it will send troops to area. LTTE (Tamil Tigers) suspended direct peace talks in April, claiming not enough being done to rehabilitate war- torn Tamil areas. Government has proposed limited autonomy for majority Tamil areas; rebels are working on counter-proposal.

Taiwanese authorities bolstered security measures after uncovering Chinese spy ring. China strongly condemned Taiwan’s eleventh bid for UN representation on 8 August. President Chen announced on 13 August commercial aviation and shipping links may be restored by end of 2004.

Talks between Armenia and Azerbaijan over Nagorno-Karabakh remain stalled, and progress in dispute unlikely until after Azerbaijan’s October presidential election. Both sides accuse each other of using dispute to distract public attention from own domestic crises – in Armenia, controversial re-election of President Robert Kocharian, and in Azerbaijan, ill- health of President Heydar Aliyev.

SFOR made unsuccessful efforts to capture indicted war criminals, mounting raid on home of Gen. Ratko Mladic's late mother on 13 August and surrounding sites associated with Radovan Karadzic in Pale on 26 August. Mitar Rasevic, chief warder at Serb prison in Foca, surrendered to Hague Tribunal. The 3 ruling nationalist parties continue to bicker - both with coalition partners and within their ranks over jobs, education and tax reform, and proposed unification of Mostar.

Upsurge in violence of recent months continues. Between 20-22 August, 28 Russian soldiers and at least 12 Chechen rebels killed in fighting. Spate of suicide attacks continued: on 1 August suicide bomber killed 35 at military hospital in southern Russia. Russian Government pushing ahead with plans to hold controversial October election for Chechen presidency.

Parliament finally approved composition of new electoral commission, but compromise went against recommendations of U.S. envoy James Baker aimed at preventing electoral fraud in Nov. 2003 elections. Little progress made in negotiations over future status of Abkhazia.

Region’s wealthiest and most stable country continues to attract attention for poor treatment of journalists and opposition figures. Kazakh authorities reportedly refusing request for pardon from Ghalymzhan Zhaqiyanov, jailed co-founder of Democratic Choice of Kazakhstan, until he promises to stay out of politics.

Serbian parliament adopted declaration on 26 August reaffirming claim to Kosovo. 2 Serb teenagers killed and 6 injured in attack by unknown assailants on 13 August. UN police officer killed in ambush on 2 August. Kosovo Serb arrested. Unknown how much of violence was response to Belgrade’s declaration on Kosovo, coming as it did during transition to new UNMIK Chief, Harri Holkeri.

Dissatisfaction with Government remains high, particularly in south. President Akayev consolidated power by pushing through widely-criticised constitutional referendum, but promises not to run in next election, due in 2005. Conviction of popular opposition leader Feliks Kulov upheld by Supreme Court.

Moldovan and Transdniestrian forces took first demilitarisation step in years, withdrawing 37 armoured vehicles from Security Zone separating sides. EU and NATO discussing OSCE proposal to send peacekeepers Moldova to help settle dispute and bring order to region.