KEY POINTS:
SUVA - Fiji's Prime Minister appears to have bowed to military pressure to defuse the coup crisis.
This evening he announced he would suspend three controversial bills at the heart of the military commander's threats against his government.
The bills will be suspended, pending legal opinion, Laisenia Qarase told reporters today amid international concern of a fourth coup in Fiji in 20 years.
They include one bill that could have forgiven those involved in staging Fiji's 2000 coup.
Qarase said legal opinion would be sought on whether they were constitutional. If they were found not to be, they would be dropped, he said.
He also recognised that the 2000 coup had been illegal, as the military had demanded.
It comes just hours after the Fijian military held exercises in Suva, taking up positions around key buildings.
Effectively Qarase has given into all the military demands.
Qarase said the government would accept any recommendation by the Director of Public Prosecutions (DPP) not to lay sedition charges against the military chief and other senior military figures - another key demand made by Bainimarama.
"If they decided not to proceed further, in the greatest interest of peace and stability in Fiji, the government would agree with this," he said in a nationally televised address.
But he added that decision was not for the government to make, and that he could not interfere with the independence of police and the DPP.
The prime minister said the concessions announced today stemmed from New Zealand-brokered crisis talks he attended with Bainimarama in Wellington yesterday.
He urged the military chief to quickly respond to the government's new position so stability could be restored in Fiji.
Qarase also cast a shadow over the future of Fiji Police Commissioner, Australian Andrew Hughes, who is currently on leave.
Bainimarama had demanded the sacking of Hughes, who has been a vocal critic of the military in its standoff with the government.
Hughes left Fiji this week and is back in Australia on leave after receiving threats as the political crisis escalated.
Qarase said Hughes' current contract as police commissioner was nearing an end and he would take into account the military's concerns in reviewing his position.
Qarase said he had called on Bainimarama in a letter to make a statement reconfirming the military has no intention of using force in Fiji or acting outside the law.
"This would go a long way towards calming fear and ending uncertainty among the people and restoring confidence in the economy," he said.
The letter also sought another meeting as soon as possible, again with Mr Peters as mediator.
Qarase said he would defer a visit to the Solomon Islands to make himself available for talks.
Answering questions from reporters, the prime minister denied he had given in under the pressure of military force.
"You will find that any concessions that I've given are all within the laws of Fiji and that is of fundamental importance.
"Any resolution of differences must be made within the law and that's exactly what I've done."
Qarase defended Hughes taking time off at the height of Fiji's crisis.
"There is also very tense and difficult relations between the commander and the police and he has decided to take some leave that is due to him," Qarase said.
"I have supported that because I think it would be in the best interests, particularly at the critical period in our efforts to try and work ourselves through the current difficulties."
Earlier, city authorities in Suva lashed out at the military over last night's show of force in Fiji's capital, saying people were alarmed by the sight of armed troops on the streets.
Angry Suva lord mayor Ratu Peni Volavola accused the armed forces of arrogance in conducting the so-called exercise, which included patrols, checkpoints and weapons firing in downtown Suva.
Hundreds of soldiers took part in the exercise, held from midnight to 3am as Fiji braced for another possible military coup and which the military said was part of preparations against possible foreign intervention.
Volavola said such activity as manning road blocks in the city should only have been conducted by the police.
"We don't have a state of emergency declared do we?" Volavola told Fiji commercial radio.
"(The military) seem to think they have a God-given right to run roughshod over all and sundry."
The lord mayor said the military had shown disrespect for city fathers and blasted its spokesman Major Neumi Leweni for saying residents were not concerned by last night's show of force.
"He's lying through his teeth. People were afraid, people were clearly alarmed."
Volavola is a member of Prime Minister Laisenia Qarase's ruling SDL party.
However, police Senior Superintendent Jahir Khan said the military did not require permission to conduct such activities.
Khan said police had learned of the exercise yesterday through the media.
Soldiers were back in their barracks today and it was business as usual in the city, although there was an unconfirmed report of another military exercise planned for Suva tonight.
As dawn broke over Suva, residents said the 2,000 soldiers who had secured strategic locations around the South Pacific capital, and fired flares and mortar rounds, were no longer on the streets.
Military roadside checkpoints erected soon after midnight for the three hour exercises had also disappeared.
>> Audio: Helen Clark talks to Paul Holmes about the overnight exercise by the Fijian military
>> Are you in Fiji? Please share your view of the situation by emailing nzherald.co.nz. If you have photos, please send them to online-editor@nzherald.co.nz.
"Its just like a normal day. There are no soldiers on the streets," said one resident who worked at a local radio station.
Fears of a fourth coup in Fiji in 20 years rose overnight as troops stretched along the waterfront past the governor's residence and the national parliament and secured utilities such as telephone and electricity headquarters.
"We are just taking precautionary measures now because a foreign intervention could be imminent and this is what we are going to do if it happens," Fiji Land Forces Commander Colonel Pita Driti told news website www.fijilive.com.
The military warned the public to exercise caution and told them not to be alarmed by troops in battle gear.
The military exercise was announced only hours after New Zealand-brokered talks between Fiji Prime Minister Laisenia Qarase and his defiant military chief broke up on Wednesday without apparent resolution.
New Zealand's prime minister, Helen Clark, said the crisis talks held in Wellington were positive but Fiji's future now depended on how the island country's prime minister and military chief behave back on home soil.
"Everything ... hangs on whether people go home and continue in that spirit and that's what the jury will be out on today," Clark told National Radio on Thursday.
Fiji media said Qarase was due to hold a news conference and address the nation, while Bainimarama would brief his officers.
Not long before the military show of force, Australia's defence force confirmed that one of its soldiers had been killed and another was missing after a Black Hawk helicopter crashed as it tried to land on a navy transport ship south of Fiji.
The helicopter had been stationed on board Kanimbla, one of three warships Australia sent towards Fiji this month in case it needed to evacuate nationals in the event of a coup.
Australia, Britain and New Zealand have advised their nationals against travelling to Fiji. Australia said it had begun evacuating family members of embassy staff from Suva.
Fiji has suffered three coups since 1987. Bainimarama was almost killed in a failed but bloody mutiny linked to the 2000 coup and blames Qarase for being soft on those behind the coup.
Bainimarama gave Qarase a list of "non-negotiable demands" and a two-week deadline last week, at the same time threatening a "clean-up" of Qarase's government.
Pacific Island Forum foreign ministers are to meet in Sydney on Friday in an attempt to find a diplomatic solution under the same regional pact that enabled Australia to lead a mission into the Solomon Islands.
- REUTERS
Our readers give their views:
It's amazing how Australia and New Zealand can go overboard with the Fiji situation. Am sorry to hear about the Black Hawk going down, outside Fiji waters in a rescue exercise, with a life lost, for the sake of what??? Trying to evacuate Australians from the turmoil in Fiji. We're still in Fiji and life is calm.
Nadi, is completely bliss and relaxed. Am sorry for businesses feeling the crunch of this impasse. Being Fiji born, one needs to understand, that in this case, no amount of advice will be heeded unless related to the individual agenda. It's a matter of Fijians against Fijians. May both parties, adjust, empathise and readily accept responsibility in urgently fixing their bruised egos. May good sense prevail, and may these be soon, before the majority of civilian Fijians are left without jobs at Christmas.
- Fiona Leggett
As residents of Suva it is life as usual. Fiji is not Africa so that there could be mayhem during these times. Fiji is a Melanesian country and is smack in the middle of the Pacific Ocean with a laid back attitude.
It is life as usual in Fiji and if you wish to come and sample what Fiji has to offer, you are most welcome. Remember, that Fiji is not Dafur, Somalia or Iraq. Fiji is Fiji and it will not change come what may.
- Paul Kausimae, Suva
I live here in Fiji with my family on the Coral Coast. We are relaxed with the situation although frustrated as it is causing nervousness for investors and financing so we are personally hampered by the impasse. Last night's exercises were only ever that "exercises". At worst it was a show of strength to any possible foreign presence which is just not necessary. The public preparation for the exercises were thorough and widespread so that no one would take fright from them. The PM was well briefed and it was not a scary situation. I am going to Suva in the morning with absolutely no worries even if there is a coup. The only bother will be that my medical appointment will probably be cancelled. The shame of the matter is that it's a fantastic time to be in Fiji. The weather is the best it's been for months and there is hardly anyone here. Still I understand the concern of travellers and hope for a quick resolution to the impasse. I am very impressed with the efforts of Winston Peters and the NZ Govt. There positive intervention is far better for the situation than the doomsday commentary coming from across the Tasman. Certainly makes me proud to be a kiwi - good on you Winston! Please give some balance to this argument
- James
The situation in Fiji is calm at the moment. I am based in Suva, and amongst the community I can feel the sorrow and fear the Fijians hold. Whether or not the coup happens, I believe the most damage has already been done. Hotels are literally empty when they should be approximately 70% full. Boat cruises and the entire tourism in Fiji is has been hit very detrimental and will take years to build back up to where it was. People are being laid off, which will result in Fiji families without a merry Christmas. Thus resulting in more crime such as petty theft. This is one reason I am leaving Fiji as I feel unsafe because of the tension and stress of the economic downfall which has occurred. I believe the only place unsafe in Fiji is Suva. There is no one person to be blamed for this, but many. From the Fiji military leader to the corrupt Fijian parliament. The NZ and Australian Newspapers are also at fault, over exaggerated stories for more money, resulting in a very tiresome, destroyed beautiful country, Fiji.
- Sarah
I'm going to Fiji for my wedding tomorrow so hopefully all will proceed without incident! Wish me luck!!
- Mirielle Noir
