Fiji's Daily Post newspaper has agreed to publish a front-page apology to the interim finance minister, Mahendra Chaudhry, and pay him damages of 6-thousand US dollars.
The out-of-court settlement was reached moments before the defamation case was due to go to trial yesterday with Mr Chaudhry present to give evidence.
It related to an opinion piece published by the Daily Post in November last year which insinuated that Mr Chaudhry was a racist, had hardcore Indian nationalist policies and his approach to multi-racialism was hypocritical.
Mr Chaudhry claimed he was seriously defamed as the article damaged his reputation as a person, a parliamentarian and as leader of the Fiji Labour Party.
As well, he claimed he suffered distress and personal anxiety.
Mr Chaudhry's lawyer, Rajesh Gordon says the apology will be published on Saturday and the compensation paid in two installments.
