By Jack Kimball

Asmara , October 20 2006 – Eritrea dismissed as a "pure fabrication" a US diplomat's charge that it was opening a new front against arch-foe Ethiopia by arming Somalia's Islamists.

US Assistant Secretary of State for African Affairs Jendayi Frazer said in Kenya on Thursday Washington had "pretty clear evidence" Eritrea was supplying weapons to the Islamists, who seized Mogadishu and much of southern Somalia in June.

"Frazer's statement.... is pure fabrication. The timing... is not surprising or secret, and it is not new," said a statement by Eritrea's Foreign Affairs Ministry released on Friday.

"Its objectives are... to cover up the failure of America's policy and activities in Somalia," the statement added.

Eritrea accused Washington of trying to "create a pretext for the invasion of Somalia by its agent, the regime in Ethiopia".

Eritrea has long denied any involvement in Somalia, where the advance of Islamist fighters threatens the Ethiopian-backed interim government.

But a UN Security Council report in May said it has sent weapons to the Islamists in a bid to frustrate Ethiopia, with whom relations remain tense after a 1998-2000 war.

Ethiopia , in turn, is believed by many to have sent troops into Somalia to bolster President Abdillahi Yusuf's interim government against the Islamists' expansion.

Diplomats fear the Somali crisis could spark a regional conflict across the Horn of Africa, already one of the world's poorest regions due to conflict and its harsh terrain.

The Islamists, who took Mogadishu in June and have been expanding across southern Somalia since then, recently declared holy war on Ethiopia, which regards them as terrorists.

Source: Reuters