Croatia and Hungary - two of Serbia's neighbours - have officially recognised Kosovo's independence.

"The government has accepted the decision of the Kosovo parliament on declaring the independence of Kosovo on 17 February," a statement by the government in Zagreb said.

Croatian Prime Minister Ivo Sanader told reporters he realised that the decision "is a difficult one for Serbia to swallow".

"But I don't expect a worsening of political and economic relations because there is no alternative to good neighbourly relations," Mr Sanader said.

Croatia's Deputy Prime Minister Slobodan Uzelac, an ethnic Serb, immediately tendered his resignation in protest against the move.

Croatia is the second former Yugoslav republic to recognise Kosovo, after Slovenia.