A Sri Lankan man waves his national flag as he celebrates in Colombo. — Reuters

The statement by the Liberation Tigers of Tamil Eelam (LTTE) on Sunday that the group has decided to “silence it’s guns” means an end of the bitter civil war that had ravaged Sri Lanka’s north and east for the past 26 years and left thousands dead.

In the statement, posted on the pro-LTTE website, said the battle had reached its end.

“We have decided to silence our guns,” said the statement from S. Pathmanathan, head of the group’s International operations. The LTTE said the decision was taken to avert any harm to Tamil civilians.

However, by the time the statement came, troops had rescued all civilians trapped in the area that was under the control of the Tigers.

President Mahinda Rajapaksa, who returned to Sri Lanka from Jordon on Sunday, received a warm welcome from his supporters and the sound of crackers was heard across the country as speculation grew that LTTE leader Velupillai Prabhakaran had been killed in the fighting. However, there was no statement from Rajapaksa.

He is now slated to address Parliament on Tuesday where he will announce the success of the military operations against the Tigers and shed light on what happened to the leader of the LTTE.

Reuters adds: Sri Lanka's $40 billion economy is struggling with depleted foreign exchange reserves, shrinking export revenues for tea and garments, rising import costs, a declining rupee currency and a balance of payments crisis.

Rajapaksa's government is counting on victory in the war to help boost the economy and renew economic growth that for years had been among the highest in south Asia.

The Tigers have warned that their conventional defeat will usher in a new phase of guerrilla conflict targeting Sri Lanka's economically valuable targets, an indirect threat to a tourism sector the government hopes can be boosted after the war.

As Sri Lankan forces on Saturday took control of the entire island's coast for the first time since war broke out in 1983, there was still no confirmed word on the fate of Prabhakaran, who built the LTTE into one of the world's most violent insurgent groups.

Military sources told Reuters a body believed to be his was found. Prabhakaran had vowed never to be taken alive. "They are taking the body for checks to confirm it is the real Prabhakaran," one military official said on conditions of anonymity. Four other military sources confirmed the recovery and said identity checks were under way.

Military spokesman Brigadier Udaya Nanayakkara denied that. The cataclysmic end to the war came after the government rejected calls for a new truce to protect civilians, and the Tigers refused to surrender and free 50,000-100,000 the United Nations and others said they were holding as human shields.