The 15-member Economic Community of West African States in a statement delivered to Bloomberg News said Ivory Coast opposition leader Alassane Ouattara will allow his rival Gbagbo a "dignified exit" if he steps down.
Ouattara was recognized by the international community as the winner of a presidential contest in November meant to divide a country torn apart by civil war in 2002. A constitutional court decision on the election, however, led Gbagbo, the incumbent president, to cling to power.
ECOWAS in its statement repeated its calls on Gbagbo to hand over authority to Ouattara "without delay."
The political violence that greeted the disputed election prompted U.N. officials to warn of genocide after its peacekeepers were attacked in Abidjan.
The military still recognizes Gbagbo as the leader of the Ivory Coast and U.N. officials said they are protecting Ouattara at his de facto headquarters at the Golf Hotel in Abidjan.
ECOWAS and African Union officials met briefly Monday with Gbagbo. Regional leaders have warned "legitimate force" might be used if the incumbent leader refuses to stand down.
Sebastian Spio-Garbrah, a director at risk management company DaMina Advisers, told Bloomberg News that Gbagbo would "probably" consider a power-sharing deal with Ouattara as prime minister.