August 17, 2011 9:36:45 PM
* Proposed sanctions would hit mineral sector, remittances
* Ethiopia says Eritrea trying to divert attention
By Patrick Worsnip
UNITED NATIONS, Aug 17 (Reuters) - Eritrea accused rival Ethiopia on Wednesday of a "frenzied campaign" to impose new U.N. Security Council sanctions on Asmara in a bid to topple the Eritrean government and secure access to the sea.
Ethiopia dismissed the Eritrean charge as an attempt to divert attention from Asmara's failure to abide by council resolutions.
Diplomats say Ethiopia is seeking council support for a request by an East African bloc to the United Nations and the African Union for sanctions on Eritrea's booming mining sector over its alleged aid to rebels fighting Somalia's government.
Eritrea has denied repeatedly that it funds and arms the Islamist al Shabaab, but the accusation prompted the Security Council in 2009 to impose an arms embargo, asset freeze and travel ban on leaders and firms in the Horn of Africa nation.
Last month, the Inter Governmental Authority on Development, or IGAD, which groups seven East African states, asked for more sanctions to hit the Eritrean mining sector and remittances.
The nation is seen as being on the brink of a minerals boom that could revive its struggling economy.
Remittances that Eritrea receives from its large diaspora in the West and the Middle East are its biggest source of foreign exchange.
"Sadly, Ethiopia has been seeking, in a frenzied campaign, for more severe economic sanctions on Eritrea under the pretext that Eritrea is playing a destabilizing role in the Horn of Africa," said a statement issued by Eritrea's U.N. mission.
It added that Ethiopia's campaign was designed "to advance its objectives of regime change and get access to the Red Sea."
Ethiopia lost access to the sea when Eritrea, which it annexed in 1952, split away again in 1993. The two countries fought a border war from 1998-2000 and their dispute remains unresolved despite a 2002 delineation of the frontier by an international boundary commission.
Eritrea's statement said the measures sought by Addis Ababa, which would also call for U.N. member states not to give grants, financial assistance or loans to Eritrea, would "harm the economic wellbeing and security of the Eritrean people."
It repeated denials that Eritrea was trying to destabilize the region or that it was behind a plot to attack an AU summit in Ethiopia last January, as alleged in a recent report by a U.N. monitoring group on Eritrea and Somalia.
A spokesman for Ethiopia's U.N. mission, Daniel Yilma Workie, said the U.N. investigators had shown that Eritrea was still carrying out the actions for which it was previously sanctioned. "In our view, this is a deliberate move by Eritrea to change the narrative," he said.
Security Council diplomats said Ethiopia had so far failed to persuade the African members of the 15-nation body -- Gabon, Nigeria and South Africa -- to submit a draft resolution to the council that would incorporate the proposed new sanctions.
They said that was because IGAD -- to which none of the three countries belongs -- had not obtained broader African Union endorsement for the new measures, unlike in 2009, when the AU backed sanctions.
Eritrea rejoined IGAD last month, four years after suspending its membership in a dispute over Ethiopia sending troops into Somalia, and shortly after the bloc had called for sanctions against Asmara.
Eritrean President Isaias Afewerki also made an unusual visit this week to Kampala for talks on regional security with Uganda, which provides the bulk of AU peacekeepers fighting al Shabaab forces in Somalia.
According to the Eritrean statement, the proposed draft would prevent foreign companies from investing in Eritrea's mining sector and prohibit the import of gold from Eritrea.
Gold, whose price has risen recently as a safe haven amid global financial turmoil, is seen as a particularly promising mineral resource in Eritrea.
The country's most advanced mining project, Bisha, believed to contain gold, copper and zinc, is run by Canada's Nevsun Resources Ltd. Earlier this year, Eritrea granted Australia's Chalice Gold Mines two new exploration licenses in a nearby location. (Editing by Peter Cooney)
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