Peace broker Norway has ended its latest shuttle diplomacy without a peace deal breakthrough, dimming hopes of an end to ethnic bloodshed. The two sides appeared on the brink of a deal to re-start peace talks two week ago, but Western diplomats here said that fresh problems over an agenda for talks was holding up a deal, despite hectic moves by the Norwegians. Norwegian special envoy, Erik Solheim, left here Friday after his second visit to Sri Lanka this month on top of visits by Norway's Foreign Minister Jan Petersen and his deputy Vidar Helgesen who failed to clinch a breakthrough. The rebel Liberation Tigers of Tamil Eelam (LTTE) insist on their October 31 proposal for self rule being taken up before a final political settlement to end three decades of ethnic bloodshed that has claimed over 60,000 lives. **Opposing views*** President Chandrika Kumaratunga on the other hand wants parallel talks on what she calls "core issues" while discussing reconstruction and rehabilitation of war-ravaged areas of the island's north-east. "The president is looking for a quick harvest, but the Tigers don't seem to want to go along at this moment," a Western diplomat close to the process said. He said failure to revive talks would be a drawback for Sri Lanka when representatives from Norway, Japan, the United States and the European Union meet in Brussels on Tuesday to review financial aid to the island. "But the Tigers also can't go on for too long without agreeing to talks," the diplomat said. **"Economic policy"*** However, international lenders say they were more concerned about the government's economic policy, which was crucial to extending budgetary assistance amid already down-graded growth forecasts by the central bank here. "On the peace process, what is more important is that both sides uphold the ceasefire," an official of an international lending agency here said. "What we are concerned about is economic policy. We are waiting for a clear signal." However, both military officials and the Tigers say that the ceasefire brokered by Oslo and in place since February 2002 is also under severe strain, particularly in the island's eastern province. At least 13 people have been killed in the region since 25 April and the victims included Tiger rebels, government security personnel and civilians **PHOTO CAPTION*** Sri Lankan PM Mahinda Rajapakse (L) talks to Norwaygian envoy Erik Solheim (C) and Norwegian Ambassador to Sri Lanka Hans Brattskar in Colombo. (AFP)