The Barak Obama administration has warned that it would block a USD 1.9 billion IMF loan facility sought by the Rajapaksa administration.

This follows Defence Secretary Gotabhaya Rajapaksa’s rejection of a US inspired call for an immediate ceasefire on the Vanni front to facilitate a meeting between UN representatives and LTTE leader Velupillai Prabhakaran in the civilian safety zone on the Mullaitivu coast,.

Well informed sources said that the warning was received on Friday afternoon. On the previous day, the Defence Secretary told the visiting Chief of Staff of the UN Secretary General, Vijay Nambiar and Hitoki Den of the UN Department for Political Affairs that a fresh lifeline wouldn’t be given to the LTTE.

Sources accused the US of using the IMF loan facility as a bargaining chip in an attempt to subvert Sri Lanka and to rescue the LTTE leadership now trapped in a civilian safety zone on the north-eastern coast. The sources said that the new US administration had conveniently forgotten that the LTTE and its front organisations were banned in the US and several other developed countries and India.

On Friday, Nambiar had a one to one meeting with President Mahinda Rajapaksa over breakfast at Temple Trees. This was followed by a luncheon meeting attended by Bogollagama, Nambiar and the Colombo based envoys of the US, India, EU, UNDP and ICRC.

Well informed sources told The Island that Gotabhaya Rajapaksa had emphasized that a fresh ceasefire would only strengthen the LTTE, thereby prolonging the misery of the civilians trapped in the war zone.

Nambiar has been also told that a visit by UN representatives to the LTTE leadership was not in Sri Lanka’s interest. The sources said that Nambiar has agreed that a meeting between UN and the LTTE leadership could cause unnecessary problems for the world body.

Well informed sources said that there was every indication that Nambiar had been influenced by a western diplomat based in Colombo to make this request for a meeting between the UN and the LTTE leader.