A breakthrough was reached Thursday between Belgium's Dutch-speaking and Francophone parties in the world's longest negotiations to form a new governing coalition -- 15 months after the elections were held on June 13, 2010.

The eight parties have announced a deal on the division of an electoral district in and around bilingual Brussels. This issue was at the core of the long disagreement.

Negotiations on other issues, such as economic and social policy, will continue. Our work is far from over, and we still need a lot of negotiations,'' said a joint statement issued by the parties.

Politicians still face tough negotiations, notably on devolving more power to the regions -- a key demand in Dutch-speaking Flanders, which is wealthier and more populated than its southern Francophone neighbor, Wallonia.

Resolving the crisis is a matter of extreme necessity for Belgium, a member of the debt-stricken euro zone. Ratings agencies have warned that Belgium's credit score could be downgraded if it remains without a government for much longer.

The country's political problems deepened late Tuesday when caretaker Premier Yves Leterme announced that he would step down to seek a senior job at the Paris-based Organisation for Economic Cooperation and Development.

In response, King Albert II, who has played a lead role in 15 months of efforts to strike a deal between Belgium's two feuding language communities, cut short his vacation in southern France and headed home.

Rifts between northern Dutch-speaking separatists and southern French speakers were seen to be overwhelming.

The long impasse has emphasized the widening gap between the wealthier 6.2 million people of Flanders and the 4.5 million French-speakers of struggling Wallonia.

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