COLOMBO, July 4 (Reuters) - A Tamil Tiger threat to breach Sri Lanka's three-year ceasefire because of attacks against its cadres is worrying, but the government and the rebels will likely reach a deal to avoid escalation, observers say.
The Liberation Tigers of Tamil Eelam (LTTE) last week threatened to carry arms while travelling in government areas from mid-July unless the military guarantees their safety, raising the spectre of the island's two-decade civil war that killed over 64,000 people.
Nordic truce monitors met with officials from the Ministry of Defence and the government's peace secretariat on Monday, and were optimistic a deal would be reached.
"We had a very constructive meeting with officials from the Ministry of Defence," said Helen Olafsdottir, spokeswoman for the Sri Lanka Monitoring Mission.
"From that meeting we are assured and confident that a common solution will be found with regards to the transport issue to avoid this becoming a larger issue," she added.
The government has yet to reply to the Tigers' ultimatum.
"The government is considering its response," said John Gooneratne, Deputy Secretary General of the government's Secretariat for Coordinating the Peace Process. "We take the views of the LTTE seriously."
The Tigers have been locked in a silent war with a renegade faction in the restive east since a 2002 truce, and have accused the military of helping them with logistics.
Dozens of people have been killed on both sides of the rebel split, while police, intelligence officers and soldiers have also been gunned down.
However while military blame the rebels and vice-versa, the police have been unable to prove who is responsible for the killings, and so the ceasefire has held intact.
The Tigers are still furious at the killing of a senior Tiger last year, and issued their ultimatum after over 40 cadres narrowly escaped injury last month when their bus was attacked in the east, where the rebels control pockets of jungle.
"It's just a stroke of extreme luck that a lot of people were not killed in that incident," said one European diplomat, asking not to be named. "They have had problems with transports like this for a long time."
"I don't think there is any need to talk about a crisis or a war or anything like that, but it is a serious issue that needs to be solved," he added.
The ultimatum came just days after the government agreed to share $3.0 billion worth of tsunami aid with the rebels, a pact that donors hope could help jumpstart stalled talks aimed at securing long-elusive permanent peace.
"I don't see why suitable (safety) arrangements can't be made," said Kethesh Loganathan of public policy institute the Centre for Policy Alternatives.
"Of course if the LTTE proceeds with the plans of having their own escorts and so on, then that would be a violation of the cease-fire agreement," he added. "That would be very serious."
- Reuters - Thomson Reuters Foundation
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