Skopje (dpa) - Macedonian Prime Minister Nikola Gruevski and ethnic Albanian leader Ali Ahmeti agreed late Friday a coalition for the troubled country's new government, local media reported.

The policy-making bodies of the two parties, meeting separately in Skopje and in the Albanian hub of Tetovo 30 kilometres to the west, backed the agreement of their leaders, reports said.

In June 1 snap parliamentary poll Gruevski's nationalist VMRO-DPMNE won by a landslide, while Ahmeti's Democratic Union for Integration (DUI) dominated in the Albanian minority, making up one-quarter of the 2.1 million Macedonians.

In the previous government, which lasted less than two years, Gruevski partnered the bitter rivals of the DUI, the Democratic Party of Albanians (DPA).

The rivalry between the DUI and the DPA stirred violence which marred the June 1 elections and forced a repeat vote at nearly 200 polling stations in Albanian-dominated north-western Macedonia.

The VMRO claimed 63 out of the 120 assembly seats, catastrophically defeating the opposition Social Democratic Union of Macedonia, which won just 27. The DUI won 18, the DPA 11 and another small Albanian party took the sole remaining seat.

Below-standard elections, as well as systemic corruption and stalled reforms have prevented Macedonia from progressing far toward European Union membership since wining the status of a candidate in 2005.

In addition, diplomatic wrangling with Athens over the name Macedonia, which Greece claims for its northern province, left it on the doorstep of NATO three months ago, while two other Balkan nations, Croatia and Albania, received a membership invitation.

Macedonia was on a verge of an all-out civil war in 2001, when Ahmeti launched an insurgency in the north-west.

The West brokered a peace and reform deal which provided more rights for the Albanians, as well as an amnesty for Ahmeti and his fighters, who made up the core of the DUI when it was founded in 2002.

Ethnic tensions in Macedonia persist, with many Slavic Macedonians wary of Albanian aspirations to join in a single state, comprising Albania proper, Kosovo, southern Serbia and north-western Macedonia. (dpa)