At least 11 people were killed in Mogadishu on Saturday when troops at the Villa Somalia presidential palace returned fire against Islamist fighters who attacked it with mortar bombs, witnesses said.

President Abdullahi Yusuf was meeting Ethiopian Foreign Minister Seyoum Mesfin there at the time, an aide told Reuters, but no one in the hilltop compound was hurt.

Residents said Ethiopian soldiers guarding Yusuf then launched shells at Bakara Market in the city below, killing a number of people and wounding dozens more.

"Seven people including a woman died in the money changers' area when more than eight mortar bombs struck several parts of Bakara," shopkeeper Muse Ahmed told Reuters.

"Four people were killed inside the market's food section," said another local trader, Yonis Abshir.

The sprawling market is notorious for its open-air arms bazaar, and has been the site of frequent skirmishes between fighters and government troops backed by Ethiopian forces.

Somalia's interim government has struggled to impose its authority on the Horn of Africa nation, and in the capital it has been rocked by an Iraq-style resistance of artillery strikes, assassinations and roadside bombings.

This week, the fighters vowed to launch more hit-and-run attacks after they briefly seized Jowhar town, which served as the government's temporary base in 2005.

The fighting, which killed 6,500 people last year in Mogadishu alone, has sharply worsened what aid workers warn is a fast deteriorating humanitarian disaster.

More than 1 million Somalis are now internal refugees, and some 20,000 flee the capital every month. Most of them end up in areas suffering from the worst drought in years.

PHOTO CAPTION

An injured man is carried into a local hospital in Mogadishu on March 24.

Reuters