commitments.Provided a credible economic reform program is followed, the European Council expresses its continuing support for the economic recovery of Indonesia, with the assistance of the International Financial Institutions.It recognizes the economic hardship faced by the people of Indonesia and welcomes the humanitarian assistance being provided both by the European Community and by Member States.

93.The European Council discussed the implications of the present situation in East Timor.It recalls the importance of a just, global and internationally acceptable solution and reaffirms its support for the efforts being made under the auspices of the UN Secretary General to that end.It further calls on Indonesia to respect human rights and fundamental freedoms and calls for the release of all political prisoners, including those from East Timor; and agreed to continue to press for the early release of Xanana Gusmao.The European Council underlines the importance of continuing humanitarian assistance to East Timor in accordance with the ECU's common position.

ETHIOPIA/ERITREA DISPUTE

94.The European Council reaffirms its dismay over the hostilities between Ethiopia and Eritrea.In particular, it condemns the bombings of each other's territories, and the needless loss of lives.While welcoming the willingness of both sides to stop air strikes, the European Council urges them both to cease all hostilities and agree upon a formal ceasefire.The European Council calls on both sides to resume negotiations, and underlines the need to settle this dispute by peaceful means.In this respect, the European Union will continue its support for the mediation efforts under way, including those of the US/Rwandan facilitation team, and reiterates its offer to provide any material assistance that could help achieve a negotiated settlement.

EURO-MEDITERRANEAN PROCESS

95.The European Council underlines the importance of the Euro-Mediterranean partnership.It agreed that the success of the ad hoc meeting of Foreign Ministers in Palermo on 3-4 June in developing the partnership had confirmed the vitality of this relationship.The European Council notes that this provided a good basis for a successful third Ministerial Conference in Stuttgart in April1999

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