By Douglas Hamilton

LAKE OHRID, Macedonia, May 3 (Reuters) - President Boris Tadic assured Balkan leaders on Saturday that Serbia would not plunge the region back into uncertainty by rejecting Europe in crucial parliamentary elections on May 11.

At an annual lakeside gathering of leaders of southern and central states, overshadowed by Serbia's divisions over European integration, Tadic acknowledged Serbia was "at a crossroads".

But he said he was convinced Serbs would vote next Sunday to pursue European Union membership and reject nationalists who oppose joining the EU unless it revokes recognition of the independence of Kosovo.

"I'm very optimistic regarding the parliamentary elections in my country," Tadic told reporters at the Lake Ohrid summit in Macedonia. "There were fears during the presidential election, but peace prevailed because the people of Serbia want to live in peace and development."

Tadic defeated ultranationalist Tomislav Nikolic in the February presidential election but narrowly. Polls ahead of next Sunday's vote forecast a tight re-match, with nationalist prime minister Vojislav Kostunica poised to tip the result in favour of the anti-EU camp if the two main parties are tied.

"RETROGRADE FORCES"

Serbia's loss of its cherished Kosovo province in 1999, when NATO and the United Nations took control, was ratified two weeks after Tadic's win by a majority of EU members and the United States, which recognised the unilateral declaration of independence by Kosovo's 90 percent Albanian majority.

This triggered violent Serb protests. The Tadic-Kostunica coalition collapsed in recriminations and charges of a sellout by the pro-Western camp from nationalists now relying heavily on Russia for diplomatic backing over Kosovo.

Alarmed by the risks inherent in a swing back to hardline nationalism in a key state in Europe's most turbulent region, Tadic's Balkan counterparts hope he can score a decisive victory and join them on the road to EU membership.

"However, we cannot neglect the fact that in this part of the world there are still retrograde forces which do not want such a future," said President Stjepan Mesic of Croatia, whose country fought a four-year war of independence from the Serb-dominated Yugoslavia.

"We would like to believe that elections to be held soon in some parts of our region will affirm the predominance of democracy and of the European orientation," Mesic told the summit on Friday.

In an effort to sway the election, the EU last week overcame its own internal misgivings and signed a Stabilisation and Association Agreement (SAA) with Serbia, although its implementation remains frozen until Belgrade hands over war crimes fugitives from the 1992-95 war in Bosnia.

Slovak President Ivan Gasparovic, one of the EU minority which refuses to recognise Kosovo, warned that accepting the loss of the province must not be forced on an ambivalent Serbia as a political condition of joining the Union.

But Bosnian Muslim leader Haris Silajdzic said Serbia did not deserve a free ride to the EU.

In a bitter attack on Serbia's continuing failure to arrest genocide suspect General Ratko Mladic, Silajdzic, chairman of the Bosnian presidency, said handing over war crimes fugitives was "not a political requirement but a court order". (Additional reporting by Kole Casule; editing by Sami Aboudi)

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