It is with great pleasure that I welcome you to Oslo to the Support Meeting for the Sri Lanka Peace Process. Norway has organised this on behalf of the Government of Sri Lanka and the Liberation Tigers of Tamil Eelam (LTTE).

This is the first such high-level international meeting to be held in support of Sri Lanka. The goal is to mobilise political support for the peace process, and to gather economic assistance to be able to address the evident and immediate needs and contribute to the realisation of a peace dividend by the whole population of Sri Lanka. A broader donor conference is planned for 2003 to raise assistance for the longer term and in larger amounts when the peace process has advanced further.

The readiness of so many governments to gather today attests to the strength and unity of the international commitment to support the peace process. This meeting also reflects the significant progress that has been made in the peace process thus far. This progress has created new opportunities and imperatives for international political and economic support for Sri Lanka. For the peace process to succeed, popular support for peace must be sustained. People must see tangible benefits of peace in their daily lives. Without significant international assistance, this opportunity will be lost.

The armed conflict between the Government of Sri Lanka and the LTTE has lasted for two decades, with over 60.000 human lives lost. A series of earlier efforts to negotiate a political solution have failed. Norway has served as the neutral facilitator for the peace process since 1998, upon the request of both parties to the conflict.

The peace process has made substantial headway in recent months. A permanent cease-fire agreement between the government and the LTTE came into force on 23 February 2002. The agreement has secured a longer absence of hostilities than ever before during the two decades of war. This is testament to the determination of the parties. It is also, in no small measure, due to their agreement on the Sri Lanka Monitoring Mission, with observers from all five Nordic countries.

The cease-fire agreement demonstrates the wisdom of the step-by-step approach adopted by the parties. Fifty years of ethnic conflict and two decades of brutal war have resulted in deep mistrust. This can be overcome only gradually. The cease-fire agreement sets out a series of deadlines for specific measures to be implemented, which the parties by and large have met. In the process, they built sufficient trust in each other to embark on the next phase of the peace process: direct negotiations.

In the direct negotiations the parties remain committed to upholding and building on the cease-fire. At the first two sessions of talks, the parties agreed to expand confidence-building measures. They focused a great deal on the humanitarian and rehabilitation needs in the war-affected areas, and on the need for human security and inter-ethnic co-operation in the eastern part of the island.

In focusing so much on the ground situation, the parties demonstrate that peace must be built up painstakingly from below, while being negotiated from the top. What decades of conflict have destroyed cannot be rebuilt in a matter of months. At the same time, we should recognise the parties’ impressive ability to make progress on the longer-term issues while addressing the needs on the ground. At the second session of negotiations the parties set in motion important processes on three tracks: to restore normalcy, to improve security, and to address political issues.

In order to support the restoration of normalcy, the parties have set up a Sub-Committee on Immediate Humanitarian and Rehabilitation Needs in the North and East. As its first task, the Committee has assisted the Norwegian Government in preparing for this meeting. The Committee has agreed on a joint appeal for immediate humanitarian and rehabilitation action in the three priority areas:

- Assistance to returning IDPs

- The needs of children and women

- The need for dignified livelihood

Another important priority is for donors to contribute a substantial portion of funds for the north and east through a trust fund, which the parties have agreed to establish to finance projects selected by the Committee. The Northeast Reconstruction Fund will be vested with a foreign government or international organisation on behalf of the donors and the parties. The parties wish to seek the counsel of this meeting before working to finalise plans for the fund.

During the operative session of this meeting, Norwegian Deputy Foreign Minister and chief facilitator Vidar Helgesen will present the appeal for immediate support for the north and east on behalf of the parties.

This afternoon participants will also be encouraged to increase assistance to Sri Lanka as a whole, and to respond positively to new challenges in the south resulting from the peace process. The poor and unemployed further to the south, away from the conflict-areas, also suffer from a war-economy that has dampened economic development. Governments will be asked to assess how their present development co-operation with Sri Lanka can be adapted to support priorities that evolve out of the peace process.

The parties are showing a high degree of pragmatism and innovation in the peace negotiations. They are showing courage and political leadership in taking a gradual approach. It is incumbent upon donor governments to respond likewise. In our assistance to Sri Lanka, we should be sensitive to the needs of the peace process and make every effort to be flexible and cut through red tape when necessary.

In the peace process, the parties are shouldering responsibility for the destiny of Sri Lanka. In the same way, they are taking ownership of rehabilitation and development efforts. Today’s meeting provides a good opportunity for the parties to discuss this aim with the participating governments.

The important progress made at the two first sessions of the talks should not mislead anyone into believing that a solution is yet in sight. The parties – and Norway as the facilitator - expect this to be a long and difficult process towards a lasting political settlement. It will involve many sessions of talks and will meet with both successes and setbacks.

The parties will rely on the continued support of the peoples of Sri Lanka. There is a groundswell of support for a peaceful settlement, and this must be sustained. It is critical that civil society help to consolidate the broad base of political support. This needs to be matched by international political and financial assistance, to demonstrate that peace will bring tangible benefits to the long-suffering population.

The first dividends have already emerged. During the cease-fire, Sri Lanka has experienced a significant economic growth when compared with the same period last year. According to the Central Bank of Sri Lanka, Sri Lankan exports increased by 33 per cent reaching by August 2002, while the expenditure on imports for the eight first months declined by six per cent when compared with 2001.

Tourism arrivals were up by 180 per cent from September 2001 to September 2002. Recovering from the negative growth last year, Sri Lanka’s GDP increased by 1,4 per cent in the first quarter of the year and is expected to reach an increase of 4-4,5 per cent during the third quarter of 2002.

The most affected in the war, civilians are now the most benefited because of the cease-fire. According to the UNHCR 103.000 people have either returned to their homes or relocated with the declaration of the cease-fire.

I am pleased to announce that the Norwegian government intends to increase our humanitarian assistance to Sri Lanka from NOK 38 million this year to NOK 90 million in 2003 in addition the our transitional assistance of NOK 15 million. In our assistance to the north and east, we will act on the recommendations of the Sub-Committee on Immediate Humanitarian and Rehabilitation Needs. Our long-term development co-operation will continue to focus in large part on the promotion of peace and reconciliation and on strengthening the economy for employment creation. Norway also plans a significant increase in development assistance to Sri Lanka in 2003 from this year’s level of NOK 112 mill.

The prospects for peace are better than for many years, though the challenges ahead should not be underestimated. As facilitator and in our development co-operation – the major part of which goes to the south of the island, Norway is committed to being a patient partner on the long road ahead. Today’s meeting clearly demonstrates that the international community also walks by Sri Lanka’s side in the peace effort.

It is my hope that this meeting will contribute to achieving the vision outlined by H.E. President Kumaratunga in her recent Address to the Nation: to rebuild Sri Lanka, so that all its peoples could live with dignity and equal opportunity.