Rajapakse in a freedom day message urged all Sri Lankans to work towards ending ethnic bloodshed in a country where over 60,000 people have been killed in a Tamil separatist conflict since 1972.

"Sri Lankans are today engaged with utmost dedication to bring about amity, solidarity and peace among all of us," Rajapakse said. "When we unite there is freedom."

The government is staging its main freedom day celebration in Colombo with a military parade that involves tanks, helicopters and naval vessels.

But the "Tamil resurgence movement" urged a closure of shops and a halt to all transport in the restive northeastern district of Trincomalee on Saturday, when Sri lanka marks the 58th anniversary of independence from Britain.

"They have distributed leaflets asking people to stay away from the streets tomorrow," a resident in Trincomalee, 260 kilometres (160 miles) northeast of the capital, told AFP.

Police said the organisation was a front of the rebel Liberation Tigers of Tamil Eelam (LTTE) which, prior to a truce in 2002, had forced boycotts of the national day and carried out attacks.

Rajapakse's government has agreed to hold talks with Tamil Tiger rebels this month in Geneva on saving their tenuous ceasefire that came under pressure with an upsurge of violence that left at least 153 people dead since December.

However, since peace broker Norway clinched a talks deal between the two sides, the level of violence has dropped sharply.

Earlier Sri Lanka's key international lenders yesterday postponed a meeting scheduled with Tamil Tiger guerrillas after protests from pro-government Buddhist monks and Marxists, officials said.

A party of Buddhist monks and the main Marxist party -- key backers of the Colombo government -- had protested to officials of the World Bank, the Asian Development Bank and the International Monetary Fund about the planned meeting with the rebels. The three international lenders said their meeting with the rebel Liberation Tigers of Tamil Eelam (LTTE) has been rescheduled until after the guerrillas and the government hold talks in Geneva later this month to save their truce.

The monks and the Marxists argued the meeting would have given official recognition to the Tigers and legitimised their alleged attacks against security forces.