ASMARA, Nov 18 (Reuters) - A U.N. report that Eritrea and other nations are sending arms and troops into Somalia amid a brewing conflict is a "fairy-tale" intended to tarnish the burgeoning Islamist movement, Asmara said on Saturday. The report to the U.N. Security Council said at least seven nations -- including Eritrea -- were providing arms and supplies to Islamists, who want Somalia ruled by sharia law, while three were arming the largely impotent interim government. "These baseless and ungrounded accusations are intended to hit two targets," said an editorial in the government-owned Eritrea Profile, a bi-weekly newspaper. "One: tarnishing and changing the countenance of the movement created out of internal political dynamism of Somalis...Two: by fabricating a fairy-tale with regard to neighbouring countries." The Islamist movement took over Mogadishu and a swathe of south Somalia in June, challenging the isolated government's aspirations of restoring central rule for the first time since the 1991 ouster of a dictator. The U.N. report accused Eritrea of sending arms including anti-aircraft weapons and troops to Somalia. It estimated 2,000 Eritrean troops were in Somalia. The Red Sea state slammed the United States for supporting Mogadishu's warlords -- whom the Islamists ousted in battles throughout the first half of the year -- and for fomenting conflict in Somalia. "The people and Government of Eritrea do strongly object (to) the unjustified intervention pursued by the U.S. as well as its mercenaries and other external forces," the editorial added. Despite the denials, most analysts and diplomats believe Eritrea is backing the Islamists militarily, while Asmara's arch-foe -- Ethiopia -- is supporting the government. They fear conflict in Somalia could quickly spread into a regional war.
