(Adds Montenegro analyst, quote, in penultimate paragraphs)

By Douglas Hamilton

BELGRADE, Sept 28 (Reuters) - Balkan states bordering Serbia saw scant hope of a breakthrough in New York talks between Serbs and Kosovo Albanians on Friday and were bracing for a rough ride whatever the next move on the breakaway province.

Those who heed diplomatic smoke signals from Washington and Brussels are braced for a unilateral declaration of independence by Kosovo in mid-December, with U.S. and majority European Union recognition but in the teeth of Serbian and Russian opposition.

Whether independence is recognised or blocked, the risks are so serious either way that no neighbouring government wants to speculate openly on how severe, long-lasting or widespread the repercussions might be.

None wants to aggravate ties with Serbia, which is warning them not to recognise Kosovo. But those with significant ethnic Albanian minorities -- such as Macedonia -- have more reason to fear the risks of delaying the decision.

"I don't want to speculate on various scenarios," said Macedonian Prime Minister Nikola Gruevski this week. "But I want to emphasise that for Macedonia, it's most important that multiethnic relations internally are kept at a very good level as they are now."

Macedonia narrowly averted all-out civil war in 2001 when NATO and the European Union smothered six months of fighting between its army and Albanian separatists.

Tensions are still never far from the surface. Macedonian special forces clashed this week with protesters trying to blockade parliament after a brawl between rival ethnic Albanian deputies. The border with Kosovo is porous and guns are rife.

Kosovo's fate, Gruevski said, could tilt the balance between "those who want peace in the region and those who don't".

The fear is that if Kosovo is denied independence, Albanian separatists will again take up arms, but this time in possible concert with their ethnic kin in Macedonia, Montenegro and Serbia's southern Presevo Valley.

ALBANIA IS CLEAR In Greece, a traditional friend of the Serbs and uneasy neighbour of Macedonia, there is fear of an unpredictable domino effect whichever way the decision goes, so Athens would rather keep Kosovo on hold for a few more years.

New EU member Bulgaria, Serbia's neighbour to the southeast, says trying to "freeze" a decision on Kosovo "puts at risk the peace and stability of the whole region". But it also fears a December secession as much as delay.

"We are worried about a possible escalation of the situation in Kosovo and a spill-over of instability in neighbouring countries such as Macedonia and Serbia, if the process is delayed or in case a unilateral independence is declared," said deputy foreign minister Lyubomir Kyuchukov.

Serbia's northeastern neighbour Romania is among a few EU states unsympathetic to the demand for independence by Albania's 90 percent majority. EU member Hungary, after some misgivings, now backs the mainstream EU line which sees supervised independence as the realistic option.

EU hopeful Croatia, bordering Serbia to the west, is keeping its head down but is expected to follow the lead from Brussels, assuming a clear signal emerges.

Officials in Montenegro are effectively forbidden to speculate about Kosovo's fate, cleaving to the mantra that whatever Serbs and Albanians agree will be fine with Montenegro -- which ended its own union with Serbia last year.

Montenegrin political analyst Srdjan Vukadinovic believes that, whatever the solution, there will be regional insecurity because one side will be frustrated, though Montenegro at least need not fear separatist strains.

"Albanians here, unlike in Serbia or Macedonia, have displayed often that they see Montenegro as their own state, and have proved their loyalty many times," Vukadinovic said.

In Bosnia, however, no official discretion can smother concern that if Kosovo Albanians win independence because they are an overwhleming majority, then the Serbs of Bosnia's Serb Republic will sooner or later opt to secede and join Serbia. Only Albania openly favours Kosovo's independence. (Additional reporting by Karolos Grohmann, Anna Mudeva, Mark Heinrich, David Chance and Dusko Mihailovic)

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