Military spokesman Lieutenant-Colonel Filipo Tarakinikini said yesterday that the proposal involved the military handing over executive power to the Great Council of Chiefs. The council would then call an urgent meeting.
Under the agreement the 27 hostages being held in Suva's parliamentary complex would be released on the same day as the meeting and the arms held by the rebel camp returned to the military.
"This is really the first serious drive towards a solution," Colonel Tarakinikini said. "The proposal brought up by the province of Naitasiri was very practical."
But he stressed that the military's firm stance would remain.
"The military is acting with a lot of restraint ... We are hoping that the talks can progress but the stand of the military remains firm."
However, the commitment of the military to impose its military exclusion deadline - due to expire at midnight last night - was unclear yesterday.
Under the ban everyone, including those inside Parliament and residents surrounding the complex, had 48 hours to leave the area. From midnight all those within the area would be viewed as hostile by the military and arrested.
The decree also gives the military power to take over any land or buildings and restrict services such as water and electricity.
But rebel spokesman Joe Nata told the Weekend Herald last night: "We will not move."
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