Mandela brokered a deal but failed to secure a ceasefire

Earlier, the FDD ambushed three cars in Ruyigi Province, east of Bujumbura, killing 11 passengers.

Three soldiers were killed in violence at the weekend.

Nearly all political parties are represented in the new cabinet but the FDD and another Hutu rebel group have rejected the agreement and vowed to continue their war against the Tutsi-dominated army.

Former South African President Nelson Mandela, who has spent two years seeking to bring peace to Burundi, portrayed the new government as a vital step towards ending the fighting.

But he became increasingly frustrated at the lack of progress towards a ceasefire and has now stepped down as mediator.

Ethnic tension

Burundian President Pierre Buyoya, who is a Tutsi, will remain in office for the first 18 months before handing over to a Hutu.

Hutus and Tutsis have shared out cabinet posts

In the new cabinet 14 out of the 26 portfolios went to Hutus and 12 to Tutsis.

The Tutsis hold the positions of defence, foreign affairs and finance whilst the Hutus keep the ministries of public security and interior.

The Tutsi minority has dominated Burundi politics for nearly 40 years.

The war between a Tutsi-dominated government and Hutu rebels was started in 1993 following the death of an elected Hutu president.