Breakthrough reached in Papua New Guinea peace talks

BRISBANE, Australia (Reuters) -- Australia on Thursday welcomed a breakthrough in peace talks on the troubled Papua New Guinea island of Bougainville, where an agreement for a referendum on autonomy and a disarmament timetable has been reached.

"The understanding...commits all the parties to continued negotiation and it provides a way forward on the two key issues of autonomy for the province of Bougainville and a referendum on its future," said Australian Foreign Minister Alexander Downer.

Secessionist rebels last month issued the PNG government an ultimatum to grant autonomy and the option of a referendum on complete independence by September 15 or face a resumption of fighting in a conflict dating back to 1988.

On Wednesday, the PNG government retreated from its previous no-compromise position and agreed to consider a proposal for a referendum to determine Bougainville's future, including questions on autonomy.

The milestone agreement came during three days of talks between PNG government officials and Bougainville rebels at the neutral port town of Rabaul in PNG's northeast.

Hundreds of people died in a decade-long secessionist revolt from 1988 to 1998, when a peace treaty was signed in New Zealand.

Prime Minister Sir Mekere Morauta said in an address to the nation this week that it was time to put the Bougainville conflict behind and "make sure that we build self-sustaining peace." PNG celebrates 25 years of independence on September 17.

Rebel factions in Bougainville have been lobbying for a referendum since the 1998 ceasefire was signed but last month accused the PNG government of delaying tactics.

Bougainville provincial governor John Morris told Australian Broadcasting Corp (ABC) radio he now had hopes for peace.

"Of course we represent different positions, but out of these differences I'm sure and I'm confident that we can effect a paramount shift to create a kind of cooperation and a sense of commitment to come up with a new deal," Morris said.

Sir Michael Somare, the PNG minister responsible for Bougainville, said the constitution would be amended to allow a referendum and for a special law on Bougainville autonomy.

"A substantial element of revenue raised in Bougainville is to be returned by grant, subject to contributions to national services (and) development," Somare told Port Moresby's The National newspaper on Thursday.

Downer said the agreement meant a temporary Australian peace monitoring group stationed on Bougainville would be reduced and that the agreement included plans for disarmament.

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