Sri Lanka may lose vital aid because of war

Jan 13, 2008 (AFP) - Japan's peace envoy opened talks in Sri Lanka on Sunday, hinting international donors may hold back much-needed foreign aid if the island's decades-long ethnic conflict escalates, officials said. Yasushi Akashi, who arrived in Sri Lanka for three days of crucial talks on Sunday, met the Marxist JVP, the main left party, for an hour-long discussion, the party said in a statement.
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"While Japan and other international donors give a lot of aid to Sri Lanka, Mr Akashi indicated that donors may call off aid, given the current ground situation," the JVP said.

Tokyo is the biggest bilateral aid giver to Sri Lanka, which is battling a 36-year-old Tamil separatist conflict that has claimed more than 60,000 lives since 1972.
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Finance ministry figures here show that Japan gave nearly 200 million dollars to Sri Lanka between January and September last year.

Akashi's visit comes amidst mounting bloodshed since the government decided this month to pull out of a tattered Norway-brokered 2002 truce with the Tamil Tiger rebels.

The envoy will not travel to the rebel-held areas in the north for talks with the guerrillas, but will meet with Sri Lankan President Mahinda Rajapakse and other gov