Malaysia is brokering efforts to end the three-decade separatist war with the Moro Islamic Liberation Front (MILF) that has killed at least 120,000 people.

 

Libya, Bangladesh and Bahrain are due to help Malaysia monitor a ceasefire on the war-torn southern island of Mindanao.

   

"We expect a final peace agreement to be signed between the government and the MILF before the Organisation of Islamic Conference meeting in Kuala Lumpur this October," said Salem Adam, Libya's ambassador to the Philippines on Wednesday.

 

Leader death

   

Peace talks, stalled since late 2001, had been expected to resume last month.

 

Philippines officials said the delay was partly due to the death of long-time MILF chairman, Hashim Salamat, in mid July.

 

The new MILF chairman is Al-Haj Murad, the group's former military chief.

 

Muhamed Taufik, Kuala Lumpur's ambassador to Manila, said MILF and government advisers would seek to resolve issues left over from exploratory talks in June.

 

Ceasefire

 

These include the formal implementation of a ceasefire.

 

"They will have formal talks once they come back," Taufik said, without specifying an exact timeframe.

 

The security situation in the Philippines is regularly cited by investors as a key concern, alongside corruption.

 

President Gloria Arroyo is a key
US ally

A peace deal with the MILF could go a long way towards attracting more investment, particularly in mineral and agriculture-rich Mindanao.

 

Manila is a strong ally of Washington, receiving US military aid and training for its troops.

 

Investment concerns

 

The United States has pledged millions of dollars in development assistance for Mindanao if a peace pact with the MILF is sealed.

   

Eid Kabalu, the spokesman for the MILF, said this week's exploratory meeting in the southern city of Cotabato would lay critical foundations for formal talks.

   

"This is necessary in preparation for the coming in of the third-party observers, led by the Malaysian team," he said.

 

"The resumption of talks is anchored on the implementation of the agreement on the ground."

 

Peace talks

   

The MILF insists Manila must honour a pledge to pull troops from a rebel stronghold they overran in February, but Kabalu said the guerrillas remained committed to restarting the talks.

 

Eduardo Ermita, presidential adviser on the peace process, said Murad would lead the MILF team at the formal negotiations, but the ceasefire had to be formalised first.

   

"A ceasefire mechanism should be in place before Malaysia schedules the peace negotiations in Kuala Lumpur," he said.