The Basque regional government delivered a rebuff to ETA after the armed separatist group announced another ceasefire and suggested it might turn to a political process in its quest for an independent homeland.

BASQUE separatist group ETA declared a ceasefire yesterday in its bloody 42-year campaign for a homeland independent of Spain, vowing to give up guns and bombs to seek a democratic solution.

Hundreds of people carrying Basque flags assembled peacefully in the historic Spanish town of Gernika to protest the proposed outlawing of a separatist party allegedly linked to terrorism.