The bank’s president, Donald Kaberuka, also said in an interview that while growth in sub-Saharan Africa had good momentum, economies needed to prepare for the risk of external shocks from slower growth in developed and large emerging economies.

Al Qaeda-linked group Ansar Dine, along with Tuareg rebels and other armed groups, swept through northern Mali in March and April, seizing the northern half of the country after the government collapsed in a March 22 coup.

“It has to be addressed quickly and decisively. Absolutely. We cannot afford to have the Sahelian belt becoming a seat of haven for terrorists and traffickers of all types,” he said at the World Economic Forum in Addis Ababa.

“It is an issue that the West African governments will have to address together and I think they would require some support from the international community,” he said in an interview.

The fear is that the instability in northern Mali could spill over to neighbors such as Niger, part of the Sahelian belt of countries that stretches across the African continent on the fringes of the Sahara desert.

SHOCK ABSORBERS

Kaberuka said sub-Saharan African economies, excluding heavyweight South Africa, were set to grow 6 percent this year, and do better in 2013.

But he warned that African countries were not as well placed to weather external shocks as in 2008 when the financial crisis first hit. Then, “shock absorbers” – fiscal surpluses, good reserves, low debt levels and low inflation – allowed governments to boost spending and cushion the blow.

“This time round, the shock absorbers are weaker, which means if there’s a major shock from the international economy our ability to withstand the shock would be much more difficult,” Kaberuka said.

He said African governments needed to ensure the current growth was shared better among fast-growing populations on the continent, as the momentum would be hard to maintain if large chunks of society were excluded.

Revenues from natural resources also needed to be spent wisely to put in place safety nets for people most likely to suffer in the event of shocks. Poor infrastructure across the continent also needed to be fixed.

“If we can do those things, ensure broadbased growth, manage national resources, rebuild the shock absorbers, I’m convinced that the momentum can be kept,” he said.

The bank’s president also said that it was planning to move its headquarters back to Ivory Coast’s main city Abidjan, now that the security situation had improved after a disputed election that sparked weeks of fighting.

The African Development Bank moved to Tunisia after the outbreak of civil war in Ivory Coast in 2002.

“From a security view point the advice we are receiving, there is now nothing preventing us from going back to Abidjan,” Kaberuka said.

“But we need facilities now. So we are rehabilitating our offices, we are looking at accommodation, schools and clinics. We are working with the Ivorian government on that. Once the facilities are in place, we are on the way back to Abidjan.”

(Editing by David Dolan, Ron Askew)

Citadel, which has focused on the Middle East and north Africa but is also looking to expand its portfolio in sub-Saharan Africa, has $4.3 billion of assets under management.

The firm has a 51 percent stake in Rift Valley Railways, the railway running from Kenya’s Mombasa port to Uganda, two gold mining concessions in Ethiopia and some projects in South Sudan, including a tract of land being cultivated for food crops.

Chairman Ahmed Heikal told Reuters in an interview at the World Economic Forum in Addis Ababa that Citadel was looking at further investments, just in east Africa at this point.

“Power is certainly very important, energy, especially distribution of energy, not necessarily upstream oil and gas, transportation and food processing,” he said, declining to give details on potential deals in the pipeline.

“The central idea is build companies in Egypt and use them as a platform to invest in the region,” he said.

But Haikal said raising capital was difficult, especially given the global economic backdrop and the relatively small size of local banking markets in sub-Saharan Africa.

“The European banking sector is retrenching, there is a deleveraging that is taking place in Europe. That will impact availability of finance for Africa, there are no two ways about it,” he said.

There is growing interest among private equity firms in sub-Saharan Africa, where economies are growing fast at a time developed nations, especially in Europe, are still struggling with the fallout from the financial crisis.

INVESTOR TRILOGY

“Financing today is a significant constraint. You have local banking sectors across Africa that cannot support the type of projects that are needed, and hence you need to get outside capital in a global environment that is not benign,” he said.

According to the World Bank, sub-Saharan Africa is expected to grow 5.4 percent this year. Stripping out South Africa, expansion will be running at more than 6 percent.

But economists and African leaders recognise the continent still suffers from huge obstacles thanks to poor infrastructure, while vast tracts of idle potential arable land are also the focus of foreign investors.

Heikal said firms had to rely on a “trilogy” of investors: development finance institutions like the African Development Bank and International Finance Corporation; sovereign wealth funds in the Gulf and Asia, and export credit agencies.

“This trilogy is very important for Africa. Because you are in a situation where money is not going to be available, plus the rules imposed on project finance under Basel III will make it extremely expensive to finance new projects,” he said.

The Basel III raft of new regulations on capital and liquidity are forcing many lenders to scale back their businesses and hold more cash.

“The South African banks are there but it’s not enough, they are not enough. There is an arsenal that is there today with this trilogy plus some of those banks. You need to have all the arsenal,” he said.

Heikal said the crisis between South Sudan and Sudan which has seen repeated clashes in disputed border areas was a worry.

But he said Citadel was pushing ahead with plans to grow staple crops on up to 40,000 acres in South Sudan. Some 6,000 acres will be planted with maize and sorghum in the next few weeks, he said.

“Those skirmishes that are happening are not exactly helping,” he said.

(Editing by David Dolan)

“We are going into something big. We are going into mining, petrochemicals, cement and infrastructure,” he said on Thursday on the sidelines of the World Economic Forum.

“We need to spend $7.5 billion in the next four years. So, definitely, we need a lot of concentration.”

Dangote said this changing focus was one of the reasons he was looking for a partnership for his flour business, Dangote Flour Mills (DANGFLO.LG: Quote, Profile, Research, Stock Buzz), with Tiger Brands, South Africa’s biggest consumer foods maker (TBSJ.J: Quote, Profile, Research, Stock Buzz).

“We are actually trying to have a partnership between us and Tiger Brands,” he said. “We believe they are much better than us in terms of the retail business.”

Banking and company sources have told Reuters Tiger Brands was bidding for an 80 percent stake in Dangote Flour Mills, which makes pasta and flour in Africa’s most populous country.

Buying all or part of Dangote Flour Mills would give the maker of bread, breakfast cereal and energy drinks a substantial presence in the Nigerian food market. Dangote said a deal was about partnership, not offloading assets.

“We are not selling. If it was to raise money, we would have … sold the whole business to them. But no. What we are trying to do is actually to have them so that we can now enjoy the downstream of the business,” he said.

Nigeria’s population of more than 160 million is a massive potential retail market, although corruption and the government’s focus on oil exports still deter many investors.

Dangote said he hoped to list his $11 billion cement company (DANGCEM.LG: Quote, Profile, Research, Stock Buzz) on the London stock exchange by the third quarter of 2013. Dangote Cement trades on the Nigerian stock exchange and is West Africa’s largest listed company.

(Additional reporting by Joe Brock in Abuja; Editing by Will Waterman and Dan Lalor)

The Central Bank of Kenya’s Monetary Policy Committee
(MPC)said even though the year-on-year inflation rate fell to
13.06 percent in April from 15.61 percent in March, underlying
food and fuel price pressures had increased.

The central bank, which was widely criticised for being to
slow to raise rates when inflation surged last year, has been
especially cautious so far this year, repeatedly flagging risks
to the inflation outlook and high credit growth.

The consensus forecast in a Reuters poll of 12 analysts was
for the Central Bank Rate to be held at 18 percent.

The decision came after the market close, though analysts
said it was likely to support the shilling against the dollar as
the April inflation data had boosted expectations the central
bank might start an easing cycle this month.

“The decision to keep interest rates on hold today does not
alter the view that we will see a significant rally in Kenyan
bonds over the medium term, as the policy rate is gradually
normalised over the coming years,” said Razia Khan, head of
research for Africa at Standard Chartered Bank.

“This should lend some support to the Kenyan shilling, even
as interest rates come down from their current highs,” she said.

A central bank survey for April showed that the private
sector expected inflation to keep declining, the exchange rate
to stay stable and the economy to remain resilient, but
policymakers said price rises needed to slow further.

“These considerations showed that there is still some
lingering pressure on inflation that could give rise to adverse
inflationary expectations,” the MPC said in a statement.

“These must be addressed to facilitate a return to high
economic activity supported by a low inflation regime,” it said.

CURRENT ACCOUNT GAP GROWS

The central bank reiterated that private credit growth
needed to come down. A surge in credit last year boosted import
purchases. Coupled with high fuel import prices, this put
pressure on the currency and increased the trade deficit.

The bank said the current account deficit widened to 13.6
percent of gross domestic product in March, and this continued
to pose a threat to both exchange rate stability and future
easing of inflation pressures.

While private sector credit growth has slowed this year, it
was still running at 24 percent in March.

“Private sector credit growth is … still too quick for
their liking and I don’t see them cutting until they have that
under control,” said Duncan Kinuthia, head of trading at
Commercial Bank of Africa.

“Otherwise, they’ll run into the same issues they had last
year, the exchange rate could come under threat, balance of
payments and so on,” he said.

The central bank in Uganda faced a similar situation to
Kenya at the start of the year. It cut its benchmark lending
rate in both February and March, but the currency slumped after
the second cut, risking an increase in imported inflation.

The Bank of Uganda has since held the rate unchanged at 21
percent, a move that has helped the currency gain ground.

Some analysts, however, said the Kenyan central bank was
getting policy wrong again, this time by being too cautious
after missing the tightening boat in 2011.

“I think the central bank are being overly conservative and
that they should have been cognisant of the sharp move in market
rates. In some respects, this decision is as egregious as the
decision not to hike was last year,” said independent
Nairobi-based analyst Aly Khan Satchu.

For the full MPC statement, click on

For more analyst comments, click on

(Additional reporting by Beatrice Gachenge, Richard Lough,
Kevin Mwanza and George Obulutsa)

Internal Security Minister George Saitoti said four grenades were hurled into the Machakos bus station at about 7.30 p.m. (1630 GMT) on Saturday from a passing vehicle, killing one person while five more died later from their injuries.

“Of course, the initial suspicion is that of al Shabaab,” he told a news conference. “It will be recalled that there have been similar incidents previously and the government has been able to successfully apprehend those responsible.”

Al Shabaab, which formally merged with al Qaeda this year, said it was at war with Kenya, but did not take responsibility for the Nairobi blasts.

“There is no peace between al Shabaab and Kenya. It is incumbent on Kenya officials to answer who was behind the bus station blast in Nairobi last night,” Sheikh Abdiasis Abu Musab, spokesman for al Shabaab’s military operation, told Reuters.

Kenya sent troops into Somalia in October in a bid to crush the Islamist rebels, following a series of cross-border raids and kidnappings on Kenyan soil, which threatened its tourism business. Kenya blamed al Shabaab for the seizures, though the group denied responsibility.

The latest Nairobi explosions were similar to two strikes at a nearby bus station and a bar that killed one person and wounded more than 20 in October, a week after Kenya began operations in Somalia.

A Kenyan man who admitted carrying out the October bus station attack said he was a member of al Shabaab and was jailed for life.

After those attacks, a top al Shabaab official urged its supporters in Kenya to shun grenade attacks and hit Nairobi with a huge blast instead.

The African Union called the blasts a “terrorist” attack and reiterated its appreciation to Kenya for its role in efforts to defeat al Shabaab and bring peace to Somalia.

“WE SHALL SUCCEED”

The October attacks spooked Kenyans and security was beefed up in the capital at hotels, government buildings, restaurants, bars and shopping malls. Saitoti said on Sunday the security forces had again intensified surveillance.

“This is an attack by people who think they can puncture the resolve of Kenyan people to fight against terror,” Vice President Kalonzo Musyoka told reporters.

“I just want to urge the country to remain calm and for all of us to even be more committed to the fight against terror, and I’m sure we shall succeed,” he said outside the Kenyatta National Hospital where almost 70 victims of Saturday’s attack were treated for their injuries.

Briton Jermaine Grant was arrested last year and charged with planning an attack in Kenya after being found in possession of bomb-making material that included batteries, wire, ammonium nitrate, lead nitrate, acetone and hydrogen peroxide.

Security sources say he had plans for hotels and restaurants in the capital Nairobi frequented by Somali government officials, Western expatriates and Ethiopians.

Soldiers from Ethiopia, Uganda and Burundi are also fighting al Shabaab in Somalia. Al Shabaab’s biggest strike outside Somalia was in the Ugandan capital in 2010, when twin suicide blasts killed 79 people watching the soccer World Cup Final.

Al Qaeda has twice hit Kenya before. In 1998, more than 200 people were killed and thousands wounded when a massive truck bomb exploded outside the U.S. embassy in downtown Nairobi.

On November 28, 2002, 15 people including three suicide bombers were killed and 80 wounded in an attack on a hotel frequented by Israelis near the Kenyan port of Mombasa.

Six people were also killed by grenade blasts in the capital in June 2010 at a prayer meeting during campaigning for a new referendum in the east African country. No one ever claimed responsibility for that attack.

(Additional reporting by Feisal Omar in Mogadishu, Humphrey Malalo; in Nairobi and Aaron Maasho in Addis Ababa; Editing by Sophie Hares)

Kenyatta, Kenya’s richest man with a fortune estimated by Forbes magazine at half a billion dollars, is the son of Jomo Kenyatta, the country’s first president after independence from Britain in 1963.

Born in October 1961, two months after his father was released from detention by the British, Kenyatta attended an exclusive private school in the capital Nairobi. He then moved to the United States to study economics and political science at the prestigious Amherst College in Massachusetts.

Back in east Africa, Kenyatta tended his family’s vast business empire, pieced together by his father during his 14 years as president and spanning farming, banking, insurance, dairy products, tourism and schools.

Kenyatta, whose name Uhuru means “freedom” in Swahili, first ran for parliament in 1997, but was unsuccessful.

Two years later he was appointed chairman of the Kenya Tourism Board to promote the country’s famed wildlife reserves and pristine Indian Ocean beaches abroad.

He was thrust onto the national political stage as the preferred successor to former President Daniel arap Moi ahead of elections in 2002.

Despite an almost total lack of experience in government, Kenyatta, then 41, had hoped to rally support from his ethnic group, the Kikuyu and the country’s largest, and follow in his father’s footsteps.

But many feared the political novice would just be a malleable stooge for the powerful elite formed by Moi during his 24 years of autocratic rule, at a time many Kenyans were thirsty for political freedom and an end to rampant corruption.

So the Kikuyu put their weight behind Mwai Kibaki, 30 years Kenyatta’s senior and a seasoned politician who had stayed close to power during most of Moi’s rule but promised the reform many Kenyans yearned for.

When an election came around five years later, Kenyatta kept his own presidential ambitions in check and aligned his party behind Kibaki to help fend off a challenge from Raila Odinga, son of the country’s first vice president.

That election sowed the seeds of Kenyatta’s present woes.

Kibaki was declared the winner. But when Odinga accused him of stealing victory as the votes were totted up, violence erupted in the Rift Valley and spread to Nairobi.

Enraged mobs attacked the Kikuyu supporters of Kibaki, hacking, beating and burning them to death.

In ordering Kenyatta to stand trial Monday, the ICC said Kenyatta mobilised an outlawed Kikuyu Mungiki militia to fight back, with the complicity of the state security apparatus.

The ICC says Kenyatta called on the Mungiki to carry out the revenge attacks, bankrolling and trucking them to hotspots in a spiral of violence that killed 1,220 people, uprooted hundreds of thousands and pushed the country to the brink.

Mungiki, which means “mob” in the Kikuyu language, is made up of youths known for decapitating victims, stripping women wearing trousers and chanting religious hymns.

The mafia-style enterprise with origins in the Kikuyu heartland near Mount Kenya runs rackets extorting money from small businesses such as the operators of taxi minibuses.

Despite his vast wealth, the media-savvy Kenyatta has shown he can appear at ease with the man in street.

Late for a news conference last year, Kenyatta blamed Nairobi’s infernal traffic jams and posted a mobile phone video on Twitter, showing him stuck in his car chatting to street kids selling peanuts.

Kenyatta has not lost sight of his presidential goal despite the indictment and his resignation as finance minister. Party officials said he has formed an alliance with former rival and fellow ICC suspect William Ruto to campaign for the presidency together.

Friday, he is expected to make his first public appearance since the ICC ruling, taking the stage at a rally with Ruto in Eldoret, close to the centre of the post-election violence.

“My conscience is clear, my will is strong and my resolve remains undeterred,” Kenyatta said on Twitter after he quit as minister. “Look forward to meeting you all as I traverse the country in the coming weeks.”

(Additional reporting and editing by James Macharia; Editing by Alessandra Rizzo)

Kenya’s military said its jets hit the town of Jilib on Sunday in an operation targeting fighters from the Somali insurgent group, killing 10 and wounding many.

Kenyan military spokesman Emmanuel Chirchir told Reuters the airstrike hit an al Shabaab vehicle armed with an anti-aircraft gun and loaded with ammunition near the camp. He said it caught fire and was driven into the camp in search of human shields, but exploded.

“Instead of taking it to safety, he drove it into the IDP (internally displaced persons) camp,” Chirchir said. “We were on point in terms of accuracy.”

Kenya sent troops into Somalia in mid-October in pursuit of the Somali militants it blames for a series of kidnappings on Kenyan soil and frequent assaults on its security forces in the border province of North Eastern.

Gautam Chatterjee, Head of Mission for aid agency Medecins Sans Frontiers Holland in Somalia, said earlier Monday that five people had been killed and 45 wounded, mostly women and children, in an explosion in the camp.

“In our hospital in Marare, we received 31 children, nine women and five men. All of them of with shrapnel injuries,” he told Reuters from Nairobi. He said three children, one man and one woman had been killed in the blast.

MSF, which said the explosion happened during an aerial bombardment, has evacuated its team from Jilib and suspended operations helping some 1,500 households in the camp.

The first serious clash between Kenyan troops and al Shabaab militants was last Thursday. Kenya said it killed nine rebels and that one Kenyan soldier wounded in the insurgent ambush subsequently died.

SEEKING ICC HELP

Odinga said Monday no Somali civilians had been targeted by the Kenyan air force, and reports of civilian deaths at the hands of its military were propaganda.

“It would be most unfortunate, but the information we have is that it’s just al Shabaab propaganda. That is what we have from our own forces,” he told a news conference in the Kenyan capital, Nairobi, with his Somali counterpart.

“If that happened really, and there were civilian casualties, then it’s an unfortunate incident, and we’re sorry about that,” said Somali Prime Minister Abdiweli Mohamed Ali.

The two prime ministers signed an agreement Monday after talks outlining the joint operation against al Shabaab.

The countries said they would be calling on the International Criminal Court in The Hague to start immediate investigations into crimes against humanity committed by members of al Shabaab.

They also called for financial and logistical support from international donors to help blockade the southern Somali port of Kismayu, which is an al Shabaab stronghold.

“Kismayu is the major supply port for al Shabaab. Our intention is to blockade it, to cut off the supply line for al Shabaab,” said Odinga.

MORE AU TROOPS NEEDED

He also said they would be seeking United Nations support for the operation and that more soldiers would be needed for an African Union peacekeeping force (AMISOM) already in Mogadishu to secure areas liberated by Kenyan and Somali troops.

The offensive by Kenyan troops in southern Somalia comes as AMISOM is battling al Shabaab rebels for full control of the capital.

U.N. special envoy to Somalia, Augustine Mahiga, said on Monday that Somali troops and AMISOM now control 98 percent of the coastal capital, but that the 9,000-strong African Union force needed reinforcements to deal with guerrilla-style attacks in so-called “asymmetric warfare.”

“In the north east of the city we are witnessing a combination of conventional warfare as well as asymmetrical warfare. It is of course quite a challenge and sends a big reminder to the troop contributing countries that we should be expediting the deployment of the remaining 3,000 troops,” he said.

“There is a need for additional equipment like helicopters and engineering teams to deal with asymmetric warfare,” he told reporters in Nairobi.

AU forces from Uganda came under attack from two suicide bombers Saturday in the capital. The AU force said two of its soldiers had been wounded, although sources said some Ugandan troops had been killed in a brief firefight.

Al Shabaab said it had killed 80 Ugandan soldiers in a two-hour battle. The insurgents have inflated death tolls from attacks in the past, while AMISOM has also underplayed actual casualty levels.

(Additional reporting by Richard Lough, Aaron Maasho and Yara Bayoumy.; Writing by David Clarke; Editing by Richard Lough and Matthew Jones)

Kenya’s military said its jets hit the town of Jilib on Sunday in an operation targeting fighters from the Somali insurgent group, killing 10 and wounding many.

Kenyan military spokesman Emmanuel Chirchir told Reuters the airstrike hit an al Shabaab vehicle armed with an anti-aircraft gun and loaded with ammunition near the camp. He said it caught fire and was driven into the camp in search of human shields, but exploded.

“Instead of taking it to safety, he drove it into the IDP (internally displaced persons) camp,” Chirchir said. “We were on point in terms of accuracy.”

Kenya sent troops into Somalia in mid-October in pursuit of the Somali militants it blames for a series of kidnappings on Kenyan soil and frequent assaults on its security forces in the border province of North Eastern.

Gautam Chatterjee, Head of Mission for aid agency Medecins Sans Frontiers Holland in Somalia, said earlier on Monday that five people had been killed and 45 wounded, mostly women and children, in an explosion in the camp.

“In our hospital in Marare, we received 31 children, nine women and five men. All of them of with shrapnel injuries,” he told Reuters from Nairobi. He said three children, one man and one woman had been killed in the blast.

MSF, which said the explosion happened during an aerial bombardment, has evacuated its team from Jilib and suspended operations helping some 1,500 households in the camp.

The first serious clash between Kenyan troops and al Shabaab militants was last Thursday. Kenya said it killed nine rebels and that one Kenyan soldier wounded in the insurgent ambush subsequently died.

SEEKING ICC HELP

Odinga said on Monday no Somali civilians had been targeted by the Kenyan air force, and reports of civilian deaths at the hands of its military were propaganda.

“It would be most unfortunate, but the information we have is that it’s just al Shabaab propaganda. That is what we have from our own forces,” he told a news conference in the Kenyan capital, Nairobi, with his Somali counterpart.

“If that happened really, and there were civilian casualties, then it’s an unfortunate incident, and we’re sorry about that,” said Somali Prime Minister Abdiweli Mohamed Ali.

The two prime ministers signed an agreement on Monday after talks outlining the joint operation against al Shabaab.

The countries said they would be calling on the International Criminal Court in The Hague to start immediate investigations into crimes against humanity committed by members of al Shabaab.

They also called for financial and logistical support from international donors to help blockade the southern Somali port of Kismayu, which is an al Shabaab stronghold.

“Kismayu is the major supply port for al Shabaab. Our intention is to blockade it, to cut off the supply line for al Shabaab,” said Odinga.

MORE AU TROOPS NEEDED

He also said they would be seeking United Nations support for the operation and that more soldiers would be needed for an African Union peacekeeping force (AMISOM) already in Mogadishu to secure areas liberated by Kenyan and Somali troops.

The offensive by Kenyan troops in southern Somalia comes as AMISOM is battling al Shabaab rebels for full control of the capital.

U.N. special envoy to Somalia, Augustine Mahiga, said on Monday that Somali troops and AMISOM now control 98 percent of the coastal capital, but that the 9,000-strong African Union force needed reinforcements to deal with guerrilla-style attacks in so-called “asymmetric warfare”.

“In the north east of the city we are witnessing a combination of conventional warfare as well as asymmetrical warfare. It is of course quite a challenge and sends a big reminder to the troop contributing countries that we should be expediting the deployment of the remaining 3,000 troops,” he said.

“There is a need for additional equipment like helicopters and engineering teams to deal with asymmetric warfare,” he told reporters in Nairobi.

AU forces from Uganda came under attack from two suicide bombers on Saturday in the capital. The AU force said two of its soldiers had been wounded, although sources said some Ugandan troops had been killed in a brief firefight.

Al Shabaab said it had killed 80 Ugandan soldiers in a two-hour battle. The insurgents have inflated death tolls from attacks in the past, while AMISOM has also underplayed actual casualty levels.

(Additional reporting by Richard Lough, Aaron Maasho and Yara Bayoumy.; Writing by David Clarke; Editing by Richard Lough and Matthew Jones)

Kenya’s military spokesman confirmed on Sunday its jets struck the town of Jilib, where the camp is located, saying 10 al Shabaab insurgents had been killed. He dismissed reports of any civilian casualties as propaganda from al Shabaab, an insurgent group linked to al Qaeda.

Somalia’s Defence Minister Hussein Arab Isse also denied the airstrike had hit a civilian camp. He told Reuters the target in Jilib was a convey of al Shabaab vehicles heading towards Kenya and dozens had been killed.

“I can confirm five dead and 45 wounded,” said Gautam Chatterjee, Head of Mission for MSF Holland in Somalia. He said three children, one man and one woman had been killed.

“In our hospital in Marare, we received 31 children, nine women and five men. All of them of with shrapnel injuries.”

Kenya sent troops into Somalia in mid-October in pursuit of the Somali insurgents it blames for a series of kidnappings on Kenyan soil and frequent assaults on its security forces in the border province of North Eastern.

The first serious clash between Kenyan troops and al Shabaab militants was last Thursday. Kenya said it killed nine rebels and one Kenyan soldier wounded in the insurgent ambush subsequently died.

MSF’s Chatterjee said the aerial bombardment was witnessed by MSF employees in the camp that is home to 1,500 households.

Chatterjee declined to comment on Kenyan military denials of civilian casualties in Jilib, saying he could only give details of the patients MSF had received for treatment.

He said MSF had now evacuated its team from Jilib so a distribution of rations planned for Monday had been postponed.

MORE AU TROOPS NEEDED

The offensive by Kenyan troops in southern Somalia also comes as an African Union force (AMISOM) is battling al Shabaab rebels for full control of the capital Mogadishu.

U.N. special envoy to Somalia, Augustine Mahiga, said on Monday that Somali government troops and AMISOM now control 98 percent of the coastal capital, but that the 9,000-strong African Union force needed reinforcements to deal with guerrilla-style attacks in so-called “asymmetric warfare”.

“In the north east of city we are witnessing a combination of conventional warfare as well as asymmetrical warfare. It is of course quite a challenge and sends a big reminder to the troop contributing countries that we should be expediting the deployment of the remaining 3,000 troops,” he said.

“There is a need for additional equipment like helicopters and engineering teams to deal with asymmetric warfare,” he told reporters in the Kenyan capital.

AU forces from Uganda came under attack from two suicide bombers on Saturday in the capital. The AU force said two of its soldiers had been wounded, although sources said some Ugandan soldiers had been killed in a brief firefight.

Al Shabaab said it had killed 80 Ugandan soldiers in a two-hour battle.

Somalia’s Prime Minister Abdiweli Mohamed Ali was in the Kenyan capital on Monday for talks about the Kenyan offensive with government officials.

(Additional reporting by Richard Lough and Sahra Abdi in Nairobi; Editing by)

Kenya’s military spokesman confirmed on Sunday its jets struck the town of Jilib, where the camp is located, saying 10 al Shabaab insurgents had been killed. He dismissed reports of any civilian casualties as propaganda from al Shabaab, an insurgent group linked to al Qaeda.

Somalia’s Defense Minister Hussein Arab Isse also denied the airstrike had hit a civilian camp. He told Reuters the target in Jilib was a convey of al Shabaab vehicles heading toward Kenya and dozens had been killed.

“I can confirm five dead and 45 wounded,” said Gautam Chatterjee, Head of Mission for MSF Holland in Somalia. He said three children, one man and one woman had been killed.

“In our hospital in Marare, we received 31 children, nine women and five men. All of them of with shrapnel injuries.”

Kenya sent troops into Somalia in mid-October in pursuit of the Somali insurgents it blames for a series of kidnappings on Kenyan soil and frequent assaults on its security forces in the border province of North Eastern.

The first serious clash between Kenyan troops and al Shabaab militants was last Thursday. Kenya said it killed nine rebels and one Kenyan soldier wounded in the insurgent ambush subsequently died.

MSF’s Chatterjee said the aerial bombardment was witnessed by MSF employees in the camp that is home to 1,500 households.

Chatterjee declined to comment on Kenyan military denials of civilian casualties in Jilib, saying he could only give details of the patients MSF had received for treatment.

He said MSF had now evacuated its team from Jilib so a distribution of rations planned for Monday had been postponed.

MORE AU TROOPS NEEDED

The offensive by Kenyan troops in southern Somalia also comes as an African Union force (AMISOM) is battling al Shabaab rebels for full control of the capital Mogadishu.

U.N. special envoy to Somalia, Augustine Mahiga, said on Monday that Somali government troops and AMISOM now control 98 percent of the coastal capital, but that the 9,000-strong African Union force needed reinforcements to deal with guerrilla-style attacks in so-called “asymmetric warfare.”

“In the north east of city we are witnessing a combination of conventional warfare as well as asymmetrical warfare. It is of course quite a challenge and sends a big reminder to the troop contributing countries that we should be expediting the deployment of the remaining 3,000 troops,” he said.

“There is a need for additional equipment like helicopters and engineering teams to deal with asymmetric warfare,” he told reporters in the Kenyan capital.

AU forces from Uganda came under attack from two suicide bombers on Saturday in the capital. The AU force said two of its soldiers had been wounded, although sources said some Ugandan soldiers had been killed in a brief firefight.

Al Shabaab said it had killed 80 Ugandan soldiers in a two-hour battle.

Somalia’s Prime Minister Abdiweli Mohamed Ali was in the Kenyan capital on Monday for talks about the Kenyan offensive with government officials.

(Additional reporting by Richard Lough and Sahra Abdi in Nairobi)