KEY POINTS:
The Government has defied an ultimatum set by Fiji's self-appointed prime minister Voreqe (Frank) Bainimarama and is waiting to see whether he goes ahead with his threat to expel acting high commissioner Caroline McDonald.
Cdre Bainimarama told the Government last week Ms McDonald would be given her marching orders unless a visa was granted to a Fijian student who is the son of a senior official.
That would breach the travel sanctions imposed on Fiji after Cdre Bainimarama led the coup that overthrew the country's elected government two years ago.
Today he was told in a formal message that the visa would not be granted to George Nacewa, the son of Rupeni Nacewa, a secretary in the office of Fiji's president.
Soon after that Foreign Minister Murray McCully spoke by phone to Cdre Bainimarama.
"We are exchanging our views and trying to work our way forward," Mr McCully told reporters.
"There's still work in progress and we'll see how it plays out. It could be a little while before we know the answer to that."
Mr McCully said it was "quite possible" he would have further conversations with Cdre Bainimarama.
Cdre Bainimarama has used the visa case to escalate the row over travel sanctions, which have been increasingly irritating his regime.
He is also refusing to accept the credentials of new defence and police attaches the Government wants to send to Suva.
Mr McCully is trying to defuse the latest diplomatic row with Fiji.
"We've been trying to deal constructively with the issues, making sure New Zealand's point of view is understood," he said.
"I think New Zealand's position is understood. Whether it's thought to be agreeable from their point of view is another matter."
TV One News reported from Suva tonight that no announcement about Ms McDonald had been made.
A Fijian government spokesman would not say whether a decision had been made about Ms McDonald.
The spokesman said it seemed the travel sanctions were "getting a bit out of hand...when schoolchildren are affected".
George Nacewa was a student at Massey University until October, when his visa was not renewed and he was sent home.
If Ms McDonald is expelled she will be the second New Zealand high commissioner to be thrown out by Cdre Bainimarama.
In June last year Mike Green was declared persona non grata after being accused of interfering in Fiji's domestic affairs.
The New Zealand Government vigorously rejected the accusation.
In a separate development, TV One reporter Barbara Dreaver was detained when she arrived in Suva last night and deported this morning.
She said she was treated well during her night in a cell.
New Zealand officials were refused access to Ms Dreaver, which Prime Minister John Key said was "totally unacceptable".
- NZPA
