Military

DATE=1/08/03

TYPE=CORRESPONDENT REPORT

TITLE=SRI LANKA TALKS (L)

NUMBER=2-298150

BYLINE=SCOTT BOBB

DATELINE=BANGKOK

CONTENT=

VOICED AT:

INTRO: The Sri Lankan government and Tamil rebels say they made progress on rehabilitating war-ravaged parts of the country - despite a dispute over disarming rebel groups. Southeast Asia correspondent Scott Bobb reports the development came on the third day of peace talks at a resort outside Bangkok.

TEXT: The spokesman for the government delegation, G-L Peiris, told reporters the two sides made solid progress on ways to rehabilitate parts of northern and eastern Sri Lanka.

He says a complete plan and timeframe are emerging for rebuilding the areas hardest-hit by the 19-year civil war.

The Tamil rebels and government negotiators also chose the World Bank to oversee millions of dollars of reconstruction aid that is beginning to come in.

/// OPT /// The World Bank had refused to sign an agreement with the rebels, but agreed to work with a joint, rehabilitation committee that includes representatives from both sides. /// END OPT ///

Mr. Peiris tells V-O-A obtaining adequate donor financing is a major priority, and to inspire donor confidence rehabilitation activities must begin.

/// PEIRIS ACT ///

We are quite confident that on the basis of the arrangements that [are] now being made by the parties this will certainly be possible and the donors will certainly regard the progress made as adequate for that purpose.

/// END ACT ///

The negotiator noted 85-million-dollars have already been pledged at a conference last month in Oslo. He says it is hoped more funds will be promised at a larger donors meeting next June in Japan.

The government and the rebels sought to downplay a dispute over the disarmament issue. Rebel negotiators Tuesday withdrew from a committee on de-escalation after the government proposed that they lay down their arms before it allows nearly 10-thousand refugee families to return to their homes in high security zones.

Rebel negotiators say it is too early to discuss disarmament, but they will continue negotiating on less controversial humanitarian issues.

This is the fourth round of peace talks since Norway mediated a ceasefire last February. The Tamil rebels had been fighting 19-years for independence from Sri Lanka's Sinhalese majority. They dropped those demands in favor of autonomy and are now talking with the government about implementing peace.

The current round of negotiations is due to end Thursday, and a new round is scheduled for next month. (SIGNED)

NEB/HK/SB/JO/RAE