By Michele Kambas and Simon Bahceli
NICOSIA (Reuters) - Leaders of Cyprus's Greek and Turkishcommunities agreed on Friday to meet again in three months fortalks on reuniting the island and to reopen a barricaded streetin Nicosia that symbolises division.
It was the first meeting between Cypriot leader DemetrisChristofias and Turkish Cypriot leader Mehmet Ali Talat sincethe Cypriot president was elected last month and raised hopesfor reviving talks that are also crucial for Turkey's bid tojoin the European Union.
"The leaders have agreed to meet three months from now,"said Michael Moller, the U.N. special representative in Cyprus,who hosted the meeting between the two men at a U.N. controlledterritory splitting Nicosia, Cyprus's war-divided capital.
"The leaders have also agreed Ledra Street, as soon astechnically possible, should open and function," he added.
Greek and Turkish Cypriots have lived separately since aTurkish invasion in 1974 in response to a brief Greek-inspiredcoup. Peace efforts collapsed in 2004 when Greek Cypriotsrejected a U.N. reunification blueprint accepted by TurkishCypriots, and soon afterwards joined the European Union alone.
Analysts say this could now be the last chance to end thedivision, and diplomats fear an enduring stalemate wouldentrench partition, harming Turkey's EU entry hopes andrelations with NATO partner Greece.
Moller said the two sides had agreed to set up committeesto discuss issues and the two leaders would then meet in threemonths to examine progress.
"I look forward ... to having in three months' time resultswhich will help both of us have a dialogue under the auspicesof the Secretary General," Christofias told reporters. "We haveto be optimistic anyway and we agreed that we shall worktogether in good will.
Former president Tassos Papadopoulos, defeated last month,made little progress towards reunification in talks with Talat.Christofias has maintained closer ties with Turkish Cypriotsand, like Talat, has a background in leftist politicalactivism.
"This is a new era we are starting for the solution of theCyprus problem. Our target is to find a comprehensive solutionto the Cyprus problem as soon as possible," Talat toldreporters after the meeting.
The Greek Cypriots in the south represent Cyprus in theEuropean Union and have the right to prevent Turkey fromjoining the bloc.
An accord brokered by the United Nations in 2006 callingfor an incremental approach to peace-building stalled over theagenda.
Christofias and his aides have warned against highexpectations of a swift resolution to a problem which hasdefied mediation for decades.
(Additional reporting by Stelios Orphanides, Writing byDina Kyriakidou; Editing by Matthew Tostevin)