Mr Ghedi (right) will remain, but his ministers will quit
The leaders of Somalia’s crisis-ridden interim government say they have resolved their differences and agreed to dissolve the cabinet.
Some 40 ministers have quit the cabinet over the prime minister’s opposition to peace talks with the Islamist militias who control the capital, Mogadishu.
The crisis had caused a rift between President Abdullahi Yusuf and Prime Minister Ali Mohamed Ghedi
Mr Ghedi’s government controls little more than Baidoa, where it is based.
"The bloated cabinet of Ali Mohamed Ghedi’s government did not do anything during its tenure," President Yusuf announced in parliament.
"From today onwards, the government has been dissolved – only the prime minister will remain."
In terms of the agreement, the prime minister is to appoint a new cabinet of 31 ministers within seven days.
Prime Minister Ghedi said that although his government had survived a democratic vote of no confidence, "the political differences which resulted from there have been thrashed out and we’re now together to serve Somali interests".
The announcement reportedly follows the intervention of Ethiopian Foreign Minister Seyoum Mesfin as mediator between the two factions in the Somali government.
Ethiopia is the main regional ally of the interim government.
The Union of Islamic Courts, whose militia control Mogadishu, condemned Ethiopia’s mediation.
"The arrival of the Ethiopian delegation in Baidoa is just another proof that the government of Somalia is a puppet of Ethiopia," said Sheikh Yusuf Siad Indho Addeh, head of internal security of the UIC.
Ethiopia and Eritrea have both denied accusations that they are fighting a proxy war in Somalia by backing, respectively, the interim government and the Islamists.
The interim cabinet originally had more than 100 members, not all of whom had been approved by parliament.
In the past 10 days a succession of ministers left the government, and Mr Ghedi narrowly survived a parliamentary vote of no confidence on Saturday.
Mr Ghedi’s opponents within the government and parliament believe he should have done more to seek a settlement with the UIC, whose militia have taken control of Mogadishu in recent months.
Somalia has been without an effective central government since warlords toppled dictator Mohamed Siad Barre in 1991.
Since then much of the country has been ruled by violence and clan law.
The UIC has been credited with success in bringing stability to Mogadishu for the first time in 15 years.