MACEDONIA and neighbouring Bulgaria have signed a landmark friendship agreement that is designed to dampen a historic rivalry in a section of the Balkans where many countries remain at odds over old ethnic and territorial disputes.

Under the deal, both countries renounce territorial claims against each other and pledge not to engage in or back hostile acts against the other.

It also commits Bulgaria to backing its smaller neighbour’s bids to join the European Union and Nato.

EU and German officials warmly hailed the agreement, with EU foreign policy chief Federica Mogherini and enlargement commissioner Johannes Hahn saying in a joint statement the treaty “is an inspiration for the whole region”.

The treaty also calls for a committee to “objectively” re-examine the common history of Bulgaria and Macedonia, a process that could lead to a review of school textbooks.

Macedonia’s conservative opposition denounced the agreement — signed in Macedonia’s capital Skopje by Prime Minister Zoran Zaev and Bulgarian Prime Minister Boyko Borisov — as an act of “capitulation” to Bulgaria.

The VMRO-DPMNE party governed the country for a decade before it was replaced by Zaev’s left-led coalition this year.

The party said it would not ratify the treaty in parliament, arguing that it would harm Macedonia’s national interests on grounds including history, language and national identity.

Bulgaria historically regarded Macedonians and their language as a branch of the Bulgarian nation and language.

While the country was among the first to recognise Macedonia’s independence from the former Yugoslavia in 1990, it angered Macedonia by refusing to recognise a Macedonian ethnic minority within Bulgaria.

It also threatened to block its neighbour’s EU and Nato accession drives. Borisov said the treaty would seek to overcome the past.

“If you look back, you will stumble and fall,” he said.