Ethiopia's lease of a port in the breakaway region of Somaliland and recognition of its independence have strained relations with Somalia. (Source: allafrica)

Talks were held in the Turkish capital Ankara to seek to mend relations between the two East African neighbours.

Relations between Somalia and Ethiopia soured in January this year, when Addis Ababa agreed to lease 20km of coastline in Somaliland, which is seeking to break away from Somalia, and recognize the territory's independence.

Somalia called the deal illegal and retaliated by expelling its ambassador and threatening to expel thousands of Ethiopian troops stationed in Somalia to help fight Islamist militants.

The foreign ministers of Ethiopia and Somalia did not hold direct talks in Ankara, instead Turkish Foreign Minister Hakan Fidan mediated between the two sides.

According to Mr. Fidan, the number of issues discussed in the second round of negotiations has increased significantly compared to the first round of negotiations and there is now "agreement on some key principles". The third round of negotiations is scheduled to begin on September 17 with the aim of reaching a "durable and workable" agreement between the two sides.

Somali Foreign Minister Ahmed Moallim Fiqi Ahmed confirmed progress had been made and said the Mogadishu government was seeking an outcome consistent with international law and the United Nations Convention on the Law of the Sea.

For his part, Ethiopian Foreign Minister Taye Atske Selassie said that his country wants to continue negotiations to resolve current disagreements and normalize relations with Somalia.