Reconciliation talks in Yemen have stumbled over the future form of the state, with ousted president Ali Abdullah Saleh's party rejecting a north-south federation, delegates and officials say.
A special committee formed equally of northern and southern representatives was this week close to signing a roadmap to solve the issue of the formerly independent south Yemen.
But the signing of such an accord has been put off as the two representatives of Saleh's General People's Congress walked out and the GPC suspended its participation, rejecting any bid to "harm the unity of the homeland."
"The main problem is related to the form of the state: should it be formed of two regions, or several," said Ahmed Awad bin Mubarak, secretary general of the national dialogue.
The talks are part of a transitional process stipulated by a UN-backed initiative, brokered by neighbouring Gulf countries, which ended a year of protests and eased Saleh out of office in February 2012, after 33 years as president.
The dialogue is tasked with drafting a new constitution and preparing for a referendum and elections next year.
But progress in the dialogue has not been smooth, and appears likely to miss the new Thursday deadline for committees to submit their recommendations.
The north-south committee has "stopped work because the representatives of the GPC have suspended their participation," said Mubarak, pointing out that the GPC has made its position clear on the outcome of the committee's work.
He said the problem goes beyond differences over the number of regions in the future federation, to a struggle between forces wanting to create a new political system and others vying to maintain the status quo.
"On the surface, the problem is about the number of regions, but at its core is a struggle between forces of the past wanting to preserve their interests, and other forces wanting to create a new political system," he said.
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Foreign Minister Abu Bakr al-Kurbi, himself a GPC member, said the party was preparing a counter proposal that suggests a federation of several regions.
"The GPC sees unity as a historic matter that could not be abandoned," Kurbi told AFP, adding that the GPC will present its proposal at the next meeting of the north-south committee.
After the former North and South Yemen united in 1990, the south broke away in 1994, triggering a brief civil war that ended with the region being overrun by northern troops.
Factions of the Southern Movement demanding complete secession of the south have boycotted the reconciliation talks that began in Sanaa on March 18.
On Wednesday, security forces stormed a square in Aden, the capital of former south Yemen, where southern activists were preparing to stage a protest against the dialogue.
But hundreds of protesters were allowed later to stage a separatist rally after organisers pledged to keep the demonstration peaceful, a security official said.
Meanwhile, UN envoy to Yemen Jamal Benomar warned on Wednesday of "procrastination" and "obstruction," urging a breakthrough in the talks before he addresses the UN Security Council on September 27 with his report on Yemen.
"Any procrastination and obstruction attempts will fail," he told AFP, recalling that the Security Council in February warned those creating obstacles, singling out some of them.
A UN Security Council statement named Saleh and the president of former South Yemen, Ali Salem al-Baid, who lives in exile, as impeding the political transition.
Thousands of people demonstrated in Sanaa on Wednesday demanding that Saleh's immunity be lifted and that he and his aides face trial over killings during a year of protest against his rule.
Saleh was accorded the immunity as part of the UN-backed deal.