An apparent crisis has erupted in international efforts to resolve the decades-old conflict in Sri Lanka following a European Union decision to brand the rebel Tamil Tigers as a terrorist group and the Tiger insistence that EU members be excluded from the mission which has been monitoring the shaky truce with the government of the South Asian island state.

The monitoring mission is led by a Swedish officer and includes some 40 monitors from EU countries that the Tigers now insist be replaced by citizens of other countries.

The EU shifted its policy into lengthy conflict in Sri Lanka recently in deciding to list the Tamil Tigers as a terrorist organisation and apply a freeze on financial assets connected with it.

The action came just a few days before the scheduled meeting in Oslo that was described by some analysts as a “make or break” occasion for the two parties to the conflict. The talks in Norway sought to clarify the status of the international Sri Lanka Monitoring Mission (SLMM) led by Norway and its effort to implement the ceasefire agreed to by the two foes in 2002.

While the Oslo talks were characterised as separate from the actual peace talks, they were regarded as crucial since they were taking place following weeks of violations that had put the entire peace process in jeopardy and stepped up efforts by the international community to put pressure on both sides to stick to the ceasefire accords.

The EU move on the Tamil Tigers, US missions and statements and others addressed both the Tigers and the Colombo Government. They all warned the Tigers to abandon violence and terrorist activities which have been on the increase, but they also put the Government on notice to also address human rights violations and rein in paramilitary groups, including perhaps the breakaway Tiger Karuna faction it has been linked to and which has been blamed for a number of violent incidents.

Both the EU declaration and statements by US Assistant Secretary of State Richard Boucher on a visit to Sri Lanka stressed the responsibilities of both sides.

In the past, the EU, and even the US, had a tendency to leave the lead to Norway in acting as an intermediary between the combatants. It was a strategy used previously also by other smaller Scandinavian states with their history as neutrals and diplomatic emissaries as they assumed major roles in conducting initiatives in Indonesia’s Aceh province or North Korea. Japan has also played an active role, hosting a donors’ meeting in 2003 in which the contributions amounted to some $4.5 billion for development and reconstruction under the condition that the ceasefire was respected.

The SLMM is composed of 60 unarmed agents from the five Nordic countries who seek to assist the two side honour the ceasefire agreements, including collection of weapons or separation of combatants. But the Oslo meeting in June was to discuss a possible increase in their numbers and protection in view of the heightened risk. They were also seeking security guarantees from the two sides, a request rendered more complicated because of the EU’s blacklisting of the Tigers as a terrorist organisation.

But the EU and US have also increased their diplomatic presence in the aftermath of the 2002 ceasefire agreement and again more recently when the accord appeared under serious threat due to renewed outbursts of conflict. Earlier peace talks in Geneva were suspended in April 2006 because of violence and more recently a Sri Lanka vessels carrying soldiers and members of the SLMM European group was attacked by Tiger ships, with 17 Government troops killed.

The political atmosphere in Sri Lanka has grown more tense and the fighting increased markedly since national elections took place in November 2005 when President Mahinda Rajapakse was elected. Representing left-of-centre Sinhalese majority politics and a renegotiation of the ceasefire terms, he narrowly defeated right-of-centre opponent Ranil Wickramasinghe who took a more conciliatory approach to Tamil demands. Most Tamils in their region in the north and east of the island boycotted the elections.

As a result of these developments, analysts in Sri Lanka and diplomats involved are concerned of a high risk that civil war will intensify to unprecedented levels, partly on the assumption that the Tigers feel they are isolated and may have nothing to lose. Some believe the EU and US actions to alienate the Tigers could backfire and exacerbate the war.

The conflict had resulted in an estimated 64,000 deaths before the 2002 truce and the resurgence of low-intensity conflict since February 2006 had claimed some 380 victims.

Main political parties in Sri Lanka recently agreed on a power sharing agreement with the Tigers to put on the table in Oslo. But the Tigers had been insisting on a separate homeland for Tamils in the Jaffna peninsula northeast of the country

The EU has been Sri Lanka’s largest trade partner primarily as an importer of textile products and has contributed modest but steady amounts of aid which has shifted from primarily development to economic cooperation and humanitarian relief because of the refugees and destruction from the fighting and Tsunami disaster in late 2004.