Official campaigning began for 7 November referendum on controversial decentralisation plans. World Macedonian Congress, which initiated poll, and opposition parties held rally in Skopje 8 October. PM Hari Kostov vowed to resign should referendum succeed. Armed group of approx. 20, led by Agim Krasniqi, former NLA commander, reportedly restricting police access to Skopje village of Kondovo.

Campaign for 7 November referendum to formally begin 7 October. Plebiscite aims to block government decentralisation plans that would result in ethnic Albanians gaining majority status in some areas. Over 50% of total 1.6 million electorate need to vote for referendum to succeed.

Controversial decentralisation laws granting greater rights to ethnic Albanian minority narrowly passed 11 August, with 61 votes in 120-seat parliament. Decentralisation deal, which represents final phase of 2001 Ohrid accord (and is crucial to Macedonia’s EU membership bid), has polarised opinion and provoked riots. World Macedonian Congress (WMC) submitted approx. 180,000 signatures to force referendum on decentralisation plans. Parliament to set date for plebiscite – WMC calling for late November poll. Town of Struga, where opposition to plan is strongest, threatened to secede from Macedonia should decentralisation plans go ahead. Former interior minister Ljube Boskovski, suspected of murder of 7 migrants in 2001, arrested in Croatia 31 August, to be tried in Croatia.

Coalition government agreed crucial yet controversial part of 2001 Ohrid peace accord granting greater rights to ethnic Albanian minority; must now be approved by parliament. Opposition nationalist World Macedonian Congress started collecting signatures to initiate referendum against proposals; 150,000 signatures needed by 23 August deadline. Long-delayed decentralisation plan would hand more powers to local councils and make Albanian second official language in municipalities with Albanian population of at least 20%. Draft law on territorial organisation foresees municipalities decreasing first from current 123 to 76 by 2008. Skopje would expand to include 2 more Albanian majority areas, pushing capital above 20% threshold. Widespread demonstrations followed government agreement, notably in Struga 22 July, where Defence Minister Vlado Buckovski had to be rescued from Social Democrat Party headquarters.

Debate intensified on decentralisation laws - last component of Ohrid peace deal and key condition before Macedonia’s aspirations to EU candidate status could be considered. Governing Social Democrats (SDSM) promised compromise with coalition partner Democratic Union for Integration (DUI) on decentralisation by 5 July.

Former PM Branko Crvenkovski sworn in as new president 12 May, named former interior minister Hari Kostov as PM. Authorities demanded extradition from Croatia of former interior minister Ljube Boskovski, who fled after being charged in connection with March 2002 murder of 7 migrants in alleged attempt to show support for "war on terror". Former customs director Dragan Daravelski arrested in Belgrade 28 May.

PM Branko Crvenkovski won second round of presidential elections. Inconclusive first round led to final 28 April vote between Crvenkovski of Social Democratic Union (SDSM) and Sasko Kedev of conservative opposition Internal Macedonian Revolutionary Organization (VMRO- DPMNE). Crvenkovski won with 63%, and turnout passed required 50%. Kedev demanded re-vote alleging election fraud. European election observers said vote met international democratic standards, despite some "serious" irregularities. Stabilization and Association Agreement between EU and Macedonia came into effect 1 April.

Presidential elections scheduled for 14 April. Contest between candidates of 2 largest political parties, current PM Crvenkovski from ruling SDSM and Sasko Kedev of opposition VMRO-DPMNE, with Albanian minority likely to cast deciding vote. Campaign could be influenced by March events in Kosovo. Macedonia officially applied for EU membership 22 March.

President Trajkovski, architect of 2001 Ohrid peace agreement, killed in 27 February plane crash. Despite loss political situation remained stable. Speaker of parliament, Ljubco Jordanovski, to serve as acting president until elections, possibly in March or April.

40-year-old church dispute re-surfaced. Government attempted to maintain unity in Macedonian Orthodox Church (MPC) by arresting Orthodox Bishop Zoran Vraniskovski, who advocates return to Serbian Orthodox Church (SPC) control. Autocephaly for MPC, declared in 1967, not recognised by Serbian Holy Synod and therefore by other Orthodox churches. Bishop Zoran reported to have support of 30% of Orthodox Macedonian monks. Ten years after being established Albanian-language Tetovo University given full legal status 21 January amid protests by ethnic Macedonian opposition parties.