The Finnish foreign ministry announced it would withdraw its 10 observers on security grounds before a September 1 deadline set by the rebels for all European Union ceasefire monitors to leave.
"Based on the fact that the LTTE (Liberation Tigers of Tamil Eelam) are not going to guarantee the monitors' safety after September 1, we will recall our observers by then," mission desk officer Marita Maunola told AFP.
No date was set for the Finnish withdrawal.
The departure of all EU observers would cripple the 57-member Swedish-led Sri Lanka Monitoring Mission (SLMM) at a time when the monitors have asked for a 25 percent increase in their numbers to oversee the collapsing 2002 ceasefire effectively.
Finland is the first of the three EU countries -- Denmark, Finland and Sweden -- to announce a pull-out from the SLMM.
The Swedish foreign ministry said meanwhile that its observers would stay in place, unless both the Sri Lankan government and the rebels demanded their departure.
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