Azerbaijan separatist region elects new leader

STEPANAKERT, Azerbaijan, July 20 (Reuters) Azerbaijan's breakaway Nagorno-Karabakh elected a local security chief as its new leader, early results showed today, but the change was unlikely to bring new policies or unlock a 20-year-old conflict over the region.

Bako Saakyan, who served in the administration of outgoing separatist president Arkady Gukasyan and was endorsed by his boss to replace him, won 85 per cent of votes in yesterday's vote, preliminary results showed.

Azerbaijan -- which lost a war for control of the mountainous territory in the 1990s -- called the vote illegal while the European Union said it did not recognise the election yesterday as legitimate.

Nagorno-Karabakh, populated mainly by ethnic Armenians, is legally part of mainly Muslim Azerbaijan. It has run its own affairs since forcing out Azeri forces in a war that killed 35,000 people and displaced more than a million civilians.

It has declared itself an independent state but that has not been recognised by any country. Efforts to negotiate a settlement with Azerbaijan have made no substantial progress.

''The EU underlines that it does not recognise the independence of Nagorno-Karabakh. Neither does it recognise the legitimacy of these 'presidential elections','' Portugal, which holds the EU presidency, said in a statement.

INDEPENDENCE Separatists in Nagorno-Karabakh say Western-backed proposals to give independence to Serbia's Kosovo province will set a legal precedent that could bolster their own bid for independence.

Saakyan, 46, says he wants international recognition for Nagorno-Karabakh's independence from Azerbaijan, and has vowed to make the sliver of land and its 140,000 people ''an example of democratic rule''.

The new leader will not break with his predecessor's policies, said Areg Gukasyan, brother of the outgoing president.

''The people supported the actions of the current president ... and now they have elected a new leader who will continue those policies,'' he said.

Saakyan's closest rival in the election was Masis Mailyan, the 39-year-old separatist foreign minister. Mailyan ceded victory to Saakyan today.

The fighting over Nagorno-Karabakh was the bloodiest of the handful of separatist conflicts that erupted after the collapse of the Soviet Union.

A ceasefire is in force but a peace agreement has never been signed. The dispute fuels instability in a region that is emerging as a major energy hub. Oil and gas pipelines built by a BP-led consortium run just a few kilometres from the conflict zone.

Gukasyan, who was badly injured in an assassination attempt several years ago, is stepping down after serving two five-year terms as president.

Reuters CS RN1858