Foreign Minister Murray McCully feels Fiji is making progress towards returning to democratic rule.
He's in Suva for talks with the military regime as the Chair of the Pacific Islands Forum Ministerial Contact Group on Fiji.
Mr McCully told Newstalk ZB's Mike Hosking there are still plenty of challenges ahead.
"I think there is progress being made towards elections. I think the question now is would they be free and fair elections. There's been some progress made in that respect with the public consultation process that has been announced."
Mr McCully says the group will hold formal meetings today with Fiji government officials and non-governmental organisations.
He isn't looking at relaxing sanctions imposed on Fiji just yet.
"I'll reserve my judgement about sanctions and the part they'll play amongst the other milestones that need to be put in place when we've had the full discussions today."
Australian Foreign Minister Bob Carr says there is a long way to go before they lift sanctions on Fiji.
Photo: Murray McCully (Getty Images)