The foreign ministry accused Eritrea of giving lip-service to "peace" to cover its designs of aggression and warmongering.

It said in a statement that it was "dismayed by the continual posturing of the Eritrean regime as the champion of peace, while continuing to occupy Ethiopian territory."

Eritrea's "noise for peace," it added, was "only a veneer intended to obscure its underlying true character of aggression and warmongering."

The statement pointed out that Eritrea for the first time claimed sovereignty over Zalambessa 4 October.

"That Eritrea could make such a ludicrous claim only underlines how important it is for Ethiopia to ensure that iron-clad guarantees are in place before embarking on any journey of peace with Eritrea," it said.

It stated that if the ongoing OAU peace process for resolving the border conflict is to achieve a peaceful solution, it should guarantee Ethiopia's demand for the return of all its territories and "a full and unequivocal return to the status quo ante, as required by international law."

It said Ethiopia was continuing its "dialogue" with the OAU in the hope of ensuring that a durable peace could be achieved.

The main conflicts in Africa during the next 25 years could be over that most precious of commodities - water, as countries fight for access to scarce resources.

Potential 'water wars' are likely in areas where rivers and lakes are shared by more than one country, according to a UN Development Programme (UNDP) report.

The possible flashpoints are the Nile, Niger, Volta and Zambezi basins.

The report predicts population growth and economic development will lead to nearly one in two people in Africa living in countries facing water scarcity or what is known as 'water stress' within 25 years.

Water scarcity is defined as less than 1,000 cu.m of water available per person per year, while water stress means less than 1,500 cu.m of water is available per person per year.

The report says that by 2025, 11 more African countries will join the 14 that already suffer from water stress or water scarcity

Nile battle

He says that if the combined population of the three countries the Nile runs through - Ethiopia, Sudan and Egypt - rises as predicted from 150 million today to 340 million in 2050 then there could be intense competition for increasingly limited water resources.

"There is already little water left when the Nile reaches the sea," he says.

And he predicts that Egypt is unlikely to take kindly to losing out to Ethiopia - a country with one-tenth of its income.

Indeed water is already a catalyst for regional conflict. The Economist magazine's Africa editor Richard Dowdon says that part of Egypt's motivation for supporting Eritrea in its conflict with Ethiopia is its mistrust of Addis Ababa's plans for the Blue Nile.

Egyptian President Hosni Mubarak has already threatened to bomb Ethiopia if they build any dams on it, he says.

There is also another potential water war in Southern Africa involving Botswana, Namibia and Angola.

The River Cuito starts in the marshlands of the Okavango Delta in Botswana before heading to Angola through the Caprivi strip in Namibia - an area that is no stranger to tensions and conflict between neighbours.

Grain imports

But given increasing populations Worldwatch identifies one way of easing demands for water - importing grain.

Agriculture is by far the biggest user of water in Africa accounting for 88% of water use.

It takes about 1,000 tonnes of water to produce every tonne of grain.

Worldwatch says that already the water needed to produce the annual combined imports of grain by the Middle East and North Africa is equivalent to the annual flow of the Nile.

Importing grain is much easier than importing water, but for poorer countries in Africa it may not be an option.

This is not the way things were supposed to work in tiny Eritrea, the youngest country in Africa. For five years after independence in 1993, Eritrea was one of the continent's brightest spots. Its economy grew by 7 percent a year. Investment flooded in, and hopes were high for fishing, tourism and trade.

But its once-thunderous economic growth has become yet another victim of the war it has waged since May 1998 with its southern neighbor, Ethiopia, which is itself in an economic slump resulting from the war.

It is hard to tell exactly how bad the economy is. Eritrea is not eager to give any satisfaction to Ethiopia, eight times the size of Eritrea and set on crushing Eritrea economically if not militarily.

So officials here emphasize the good. Privatization of state-owned businesses is moving along. The nation still has little debt. Inflation, while rising, has not spun out of control. Eritrea, in short, has not collapsed.

Still, officials concede reluctantly that the war -- particularly bloody and, nearly everyone agrees, particularly pointless -- has at a minimum cost the momentum that had been pushing Eritrea forward so impressively. And, experts say, the longer the war drags out, the harder it will be for the nation to recover.

"Peace is important not only for the Eritrean economy but any economy," said Tewolde Woldemichael, director general of the nation's Department of Trade. "I don't think any economy can afford to conduct war and go at the pace it deserves to as far as development goes."

John Weakliam, a banker who lives in Eritrea and is generally optimistic about its prospects, said, "The economy is frozen."

There had been signs before the war that Eritrea could not sustain such high levels of growth. But that slowdown became more pronounced in 1998 after the war began. Economic growth dropped to 4 percent last year, and experts predict that it will be lower for 1999. Imports and exports are down, as are housing construction and foreign investment. Tourism, a small but growing industry, has all but disappeared.

In Massawa, an island city on the Red Sea that has weathered occupations by the Turks, Egyptians and Italians, the story of rejuvenation, followed by war-induced stagnation, is especially striking. Since the early 1990's, Eritreans had worked with their characteristic energy to rebuild the port, Eritrea's biggest. It had been all but destroyed when Eritrea was still part of Ethiopia, at the end of the rebellion against the Government of Haile Mariam Mengistu that succeeded in overthrowing him in 1991.

The current leaders of Ethiopia and Eritrea fought side by side as rebel leaders against Mengistu's rule. Afterward, they became economically intertwined, to the point of uncomfortable dependence.

Ethiopia was landlocked after Eritrea split off in 1993, largely with Ethiopia's blessing, and had to rely on the port in the southern Eritrean city of Assab. In turn, Eritrea, which does not grow enough food to feed itself, relied on Ethiopia for up to two-thirds of its trade, much of it in food.

By last year, despite old machinery and a shallow harbor, the port processed nearly one million tons of cargo, some of it food aid and construction materials going on to northern Ethiopia.

But this year, business at the port started to decline. The amount of cargo is 60 percent off target, said Araia Tsegai, the port manager. And, of course, nothing is going into Ethiopia. "The war has had an effect," Tsegai said.

In many ways, the conflict between Ethiopia and Eritrea -- which experts estimate has killed 50,000 or more fighters on both sides -- began as an economic dispute between former friends.

Eritrea introduced its own currency in 1997 over Ethiopia's objections, creating tensions and making trade more difficult.

Their relationship had become so sour by mid-1998 that when a dispute arose over an ill-defined border in the Badme region, the two nations went to war.

The battles were fierce, if intermittent, and hopes had been high late this summer that a peace deal would be reached. But weeks later, Eritrea is still alone in its final acceptance of a peace accord brokered by the Organization of African Unity.

Ethiopia, while accepting the plan's outlines, has not signed off on the details. The worry is that, without a final deal, fighting may resume now that the dry season has begun.

When a peace agreement finally is signed, the big question will be how quickly Eritrea can rebuild its economy. The fighting has been contained along sparsely-occupied borderlands, so physical reconstruction is not the issue.

Some experts argue that it will take a long time because Eritrea has spent so much on the war rather than on building its economy. Tens of millions of dollars were spent on military hardware, including at least six fighter planes. No one knows exactly how many Eritreans died fighting.

"You can say that all the positive results that had been obtained by Eritreans in their seven years of independence have been nullified by 15 months of war," said a Western diplomat in the capital, Asmara. "The bill has not arrived. It will be a huge cost."

Others argue that no lasting damage has been done because Eritrea itself has so much going for it.

Although a search for oil has not panned out, the nation has other natural resources, like gold, copper and marble.

Eritrea on Monday accused Ethiopia of destroying six Eritrean villages in a border area which Ethiopia occupied during fighting between the two countries in February.

``Administrators in the zone now report that Ethiopian forces have destroyed houses and villages and, in some cases, razed entire villages to the ground,'' the Eritrean news agency said.

There was no immediate response from the Ethiopian government.

Tens of thousands of soldiers have died during a vicious border war between the two Horn of Africa states in the last 17 months, and efforts by the Organisation of African Unity (OAU) to resolve the dispute have so far failed.

In February the Ethiopian army forced Eritrea out of the disputed Badme area along the western end of their border after heavy fighting, and pushed into land which Eritrea says is unquestionably part of its country.

Eritrea says around 4,000 Eritrean residents of the Gash Barka zone have since fled to displacement camps in the area.

Eritrea has accepted a peace plan drawn up by the OAU but Ethiopia says it is not satisfied with certain ``technical details'' and says it doubts Eritrea's commitment to peace.

The plan calls for a ceasefire, the withdrawal of troops to positions they held before fighting began in May 1998, and negotiations on the disputed border.

The front line has been relatively quiet since June, although there are fears that fighting could soon erupt again, now the rainy season is drawing to a close.

The Eritrean Government spokesperson,Yemane Ghebremeskel, said Sudan had made no formal extradition request for the two, Abdel-Aziz Khalid and Abdel-Rahman Saeed.

On Saturday, a Sudanese minister was quoted as saying Khartoum was seeking the extradition of the men for trial.

Eritrea has supported the Sudanese opposition movement but denies that opposition fighters maintain bases on Eritrean soil.

During a court appearance, he said that he had been beaten by Ethiopian police and that his safety could be not be guaranteed.

Along with other former government officials, Mr Tamirat is charged with embezzling up to $10m of public money.

He said that the authorities were denying him medical treatment for the ear and tooth ache from which he has been suffering over the past six months.

Since he was arrested in 1997, Mr Tamirat has routinely complained about the conditions in which he has been detained.

"Untrue statements"

Mr Tamirat, who maintains he is a prisoner of conscience, says he has been forced to make untrue statements, been denied access to his family, and is living in unhygienic conditions with no access to reading materials.

Mr Tamirat has submitted a written complaint to the court and demanded that it be passed on to the Ethiopian Human Rights Council and the country's parliament.

Mr Tamirat was a key player in the movement to overthrow the military regime of Colonel Haile Mariam Mengistu. He then served as prime minister from 1991-1996.

After the 1996 elections, he became deputy prime minister and defence minister.