The other is Pale in the east, the official "capital", a former ski resort outside Sarajevo. Banja Luka is Ms Plavsic's power base, and its politics have traditionally been more moderate, in contrast to Pale, where Momcilo Krajisnik, the Serb representative on the three-man Bosnian presidency, Mr Karadzic and General Ratko Mladic are based.A civil war between Serbs would probably split the Bosnian Serb republic on those lines, weakening it, inviting the Muslims to push north through the Posavina corridor - which was almost cut during the 1992-95 civil war - making it easier for Muslim and Croat refugees to return home and for Nato troops to seize Mr Karadzic and General Mladic, who are wanted for war crimes."If individual actors in the crisis should continue to destabilise and destroy the state, the army of the Serb Republic shall no longer tolerate and warn but shall undertake measures to defend integrity, sovereignty and constitutional order," the Bosnian Serb general staff said in a statement released in Pale. But the Bosnian Serb military remains an obstacle.The Republika Srpska comprises two lobes connected by the narrow Posavina corridor running past Brcko in the north. The French Finance Minister, Dominique Strauss-Kahn, is adamant the single currency will go ahead in 1999.The meeting was also no doubt an effort to dispel the rumours that the pair do not very often see eye to eye. Yesterday, the Bosnian Serb military staff based in Bijeljina warned Ms Plavsic that it would move against her to prevent the Republika Srpska splitting in two. Ms Plavsic yesterday appeared to have wrested control of the Banja Luka police from officers loyal to Mr Karadzic and the UN has started re-training Bosnian Serb policemen in Banja Luka to create a "non-political" police force as part of efforts to defuse conflict within the Serb community and to consolidate a peaceful, democratic society.

Mr Jospin said: "We have different traditions, but we have common values and we are both socialists.". Bosnian Serb President Biljana Plavsic has won the first round of her battle with supporters of Radovan Karadzic, but she has a hard struggle ahead which could still split the Bosnian Serb mini-state in two, geographically as well as politically. Mr Jospin lobbied for this summit at the intergovernmental conference in Amsterdam in June, emphasising the importance of a "social Europe" and rejecting an EU based solely on economic issues.Social concerns in Europe have not dampened the French government's enthusiasm for the single currency and Mr Jospin will have been keen to find out exactly where the British stand before he meets Chancellor Helmut Kohl next week. Speaking to journalists, Mr Jospin commented on Mr Blair's youth, and the leaders said that Europe was on the lunch menu, "along with some relaxing chat".Officials at Mr Jospin's office have been keen to underline the private nature of the lunch. A spokesman from the Matignon said: "We have no idea what the two men will discuss."However relaxed the meeting was, it is the first time the two leaders have met on a one-to-one basis and both were keen to see what common ground they have, particularly on Europe.It is likely that the French leader will have tried to gain the support of his British counterpart on jobs in Europe, which will be discussed at the EU employment summit in November.

A Downing Street spokesman said: The gift "was very much appreciated, but the Blairs will leave the horse with a local family who also have children who are able to ride it."He was unable to say whether the animal was given to the French family to keep or for safekeeping until the Blairs are able to visit it again. It is thought the Blairs may have been concerned about finding adequate stabling for it in the Downing Street area.As they walked back to the Blair holiday home for lunch, they discussed in French Mr Jospin's budget for 1998. Most of the 200 inhabitants of the village were also there to welcome them.The leaders had a glass of champagne with the proud and elated mayor in the village square, where the villagers presented Mr Blair's three children with a young pony called Justin.However, the children will not be bringing the pony - of the Pyrenees Merens breed - home with them. Mr Blair, who has received a royal welcome here since his arrival, looked relaxed in his holiday attire of a shirt and summer trousers.

Neither man wore a tie as they strolled through the village, swamped by journalists and television cameras. Good luck to them.Lewes Sculpture Trail, throughout the town to 31 Oct Info: 01273 674692. Joanna Lee Paris Europe's two newest left-wing leaders had lunch together yesterday in the village of Saint Martin d'Oydes, in the beautiful Ariege region in south-west France. Tony Blair has been on holiday there with his family and the French Prime Minister, Lionel Jospin, who was visiting his constituency of Cintegabelle, 20 miles away, drove over for lunch with his wife Sylviane.The atmosphere was casual. Such civic philistinism is happily a thing of the past and this year's trail is billed by the organisers as "the first step in establishing Lewes as a town of sculpture".

Warren tried to give the sculpture to the town, but the subject was deemed unsuitable for public display and it ended up by being sold to London's Tate Gallery. Earlier this century it was home to the collector Edward Warren, the man who commissioned Rodin to create his erotic masterpiece, The Kiss. Look out for Walter Bailey's Ebb Tide, carved from the wood of fallen trees and sited beside the River Ouse; Tim Harrison's Recumbent Stones in Grange Gardens, echoing the forms of the downs that surround the town; and Stephen Gregory's Sentinel (right) and his bronze Paparazzi; a group of Giacometti- like cameras on legs in the grounds of Lewes House.Gregory's is not the first sculpture to grace the house's gardens. You must put it in its best environment, like a person, if you wish to see it at its best." Which, for Moore meant in the open air, with trees and water and above all with sunlight. Since Moore's death in 1987 there has been a steady rise in the number of venues for viewing sculpture outdoors, including the mighty sculpture parks at West Bretton in Yorkshire and Goodwood in Sussex, but Moore would have been equally cheered by the growing trend for smaller, temporary exhibitions - the latest of which opened yesterday in the town of Lewes in East Sussex. For the next two months, the work of 15 sculptors, chosen from open submission, can be seen scattered throughout the town from the grounds of the old Star Brewery to the ruins of Lewes's 11th-century Clunaic Priory. "A sculpture is like a person" said Henry Moore "and you must treat it like one. Brian O'Callaghan, director of trading, said: "The remarkable number of fan sales recorded had much to do with a sparkling electrical performance." A spokeswoman for Comet, the high street electrical chain, said sales had doubled in the last couple of weeks although she could not give figures.