SUVA, Fiji -- Fiji's military on Wednesday stepped up the pressure on rebels holding 27 hostages in parliament, declaring an off-limits military zone around the area and offering amnesty to anyone who leaves within two days.
The roughly one-square-mile zone was to be closed to all but military personnel starting at midnight Wednesday. Those who are still in the area 48 hours later will be subject to arrest.
''This is not the first step toward a military option,'' Lt. Col. Filipo Tarakinikini told a news conference. ''This is just a step to resolve the situation with a non-confrontational approach.''
Former insurance executive George Speight, who led the May 19 coup that ousted an ethnic Indian-led government, has said he would see such military action as provocation that could spark violence toward the hostages.
Tarakinikini said the military will allow food to be delivered but may cut off utilities to the parliament compound, which Speight also has warned against.
Speight supporters who have been entering the area freely will be banned in an effort to isolate the hostage-takers.
Machine guns and two grenades were fired from the parliament area during a clash Tuesday between troops and rebels that left five rebels wounded, Tarakinikini said. The situation was described as tense but calm Wednesday.
Tarakinikini said they were trying to set up preliminary talks, the first since a tentative agreement fell apart at the last minute last week. He said the military still hoped for a peaceful conclusion, but that it was not willing to let Speight ''dictate'' its actions and has not ruled out more drastic action.
A mini-mutiny at an army base at Labasa, on the northern island of Vanua Levu, ended Wednesday, about 24 hours after it began when two or three soldiers sympathetic to Speight confiscated arms and ammunition. Tarakinikini said local chiefs were threatening disturbances in support of Speight.
''Police have gone around and warned shops that they might have to be closed,'' he said.
Speight had predicted Tuesday the mutiny would spark a ''domino effect'' across the country, but there were no signs of other trouble.
Meanwhile, the new government, installed Tuesday by the military over Speight's objections, was settling in to face a massive task: how to stem the economic decline since the coup.
Most top tourist resorts have been hit hard, with some reporting occupancy rates of only 10 percent, and rebuilding confidence among foreigners will be a top priority.
The decision by the military on Monday to appoint a new government comprised entirely of indigenous Fijians would appear to meet Speight's stated goals of trying to safeguard native rights.
But he was angry that his choice to head the country was ignored and said he did not believe the new government would be around long.
Commodore Frank Bainimarama, who assumed power 10 days after the coup, appointed the interim leaders. He has said he will retain power until the captives are freed.
The army has given in to most of Speight's demands to disenfranchise Fiji's ethnic Indians, including firing Prime Minister Mahendra Chaudhry -- the first Fijian of Indian ancestry to lead the country. Chaudhry is among the hostages.
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