Envoy urges peace amid Balkan battle

Pardew will work with EU peace envoy Francois Leotard

SKOPJE, Macedonia -- Fighting has continued in Macedonia as U.S. peace envoy James Pardew met with the country's leaders.

President Boris Trajkovski met Pardew, who had arrived a day earlier in Skopje to encourage the resumption of peace talks.

Pardew was to meet Prime Minister Ljubco Georgievski later on Monday.

Pardew urged Macedonia's political leadership to guide the country out of the crisis, Associated Press reported.

"We look to them to take this responsibility and seize the moment," Pardew said.

AUDIO CNN's Nic Robertson: James Pardew to meet the president 2.95 MB / 35 secs AIFF or WAV sound

"There are some people who believe the use of force is appropriate here. That is not the case."

In separate attacks in the north of the country, rebel mortar fire killed one soldier and wounded two others Sunday night, AP quoted the government saying on Monday.

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Government troops also came under fire in the village of Tanusevci from the Kosovo side of the border.

The rebels use the Serb province of Kosovo, which is predominantly ethnic Albanian, as a place to re-group and re-supply, AP said.

Rebel commander Gazim Ostreni denied that rebels had fired from inside Kosovo, saying, "we have no forces in Kosovo and thus it is impossible to attack from the other side."

State radio reported that the rebels took control of four villages and expelled Slav civilians.

A Human Rights Watch team met a convoy of about 50 villagers leaving Setole and Otunje, who said they had been forced out by armed rebels, said team leader Peter Bouckaert.

They said a larger group left a day earlier.

VIDEO CNN's Nick Robertson reports on President Trajkovski's struggle to maintain control in Macedonia (June 26) Play video (QuickTime, Real or Windows Media)

"Certainly we are concerned that Macedonian civilians in this area were physically threatened by the (rebels)," Bouckaert told AP.

"One of the Macedonians told me he had had a gun pointed at him and (was) told to leave the village."

About 100,000 mostly ethnic Albanian villagers have been displaced since the conflict began.

Heavy shelling and machine gun fire erupted around Tetovo and near a village northwest of the Skopje after a weekend of calm.

Eyewitnesses told Reuters that two Mi-24 helicopter gunships flew towards the village of Radusa on Macedonia's western border with Kosovo on Sunday evening.

The village, occupied by ethnic Albanian rebels, has been a flashpoint in the four-month old conflict between the rebels and the Macedonian army for about two weeks.

Eyewitnesses in Tetovo said they heard artillery and automatic gunfire in the area around the hillside villages of Gajre and Sipkovica to the west of the mainly-Albanian town.

Earlier, ethnic Albanian rebels were reported to have moved into four villages close to Tetovo.

The rebels took control of Otunje, Varvara, Setloe and Brezno, on Sunday ordering villagers to leave.

EU officials have warned the Former Yugoslav Republic of Macedonia that aid could be suspended if the country's Slavs and ethnic Albanians fail to bridge their differences.

On Friday, NATO formally approved plans to send a 3,000-strong force to Macedonia to help disarm ethnic Albanian rebels, reflecting growing international involvement in Macedonia.

But the force will only be deployed if a lasting political agreement and cease-fire takes hold to resolve the country's crisis.

The government says the rebels are "terrorists" intent on breaking up the country. The rebels say they are fighting for more rights for ethnic Albanians.

The government announced on Saturday it is to introduce a war tax to cover a widening budget deficit caused by the worsening security situation in the country, the state MIA news agency said.