(Corrects source in paragraphs 4-5 to Information Minister instead of Deputy Defence Minister) By Sahal Abdulle MOGADISHU, Dec 1 (Reuters) - The U.N.'s special envoy to Somalia urged its government and Islamist movement to return to peace talks despite a suicide bombing near the government seat of Baidoa which killed nine people. "Despite this incident, which we condemn, we are still working with the two parties to resume talks," Francois Loseny Fall told Reuters in Nairobi. Peace talks stalled in Khartoum last month and may resume there this month. The car bombs went off at a checkpoint 5 km (3 miles) outside Baidoa on Thursday. Two policemen and two suspected bombers were among the dead, officials said. Information Minister Ali Jama Jangali told Reuters the toll had risen after one person died overnight from their injuries. "This looks like an ugly terrorist attack, like the ones we have seen in Afghanistan and Iraq," he said from Baidoa. Deputy defence minister Salad Ali Jelle initially blamed the Somalia Islamic Courts Council for the attack, but Jangali said on Friday it was too early to point the finger at anyone. The Mogadishu-based religious movement, born out of sharia courts, denies any involvement. It suggested its arch-foe Ethiopia had a hand in the blast which happened less than three months after suicide bombers targeted President Abdullahi Yusuf. "The people who died are Somalis and the only one who will benefit from this are the Ethiopians," said Islamist spokesman Abdirahman Ali Mudey. Diplomats fear the stand-off between the Islamists, who control much of south Somalia, and the Ethiopian-backed government will spiral into all-out conflict, sucking in neighbouring countries and attracting foreign Islamic militants. Talks between the two sides have repeatedly stalled and some fear the latest violence will derail plans for another round of negotiations in mid-month in Sudan. "We're trying to reduce the tension and get both sides to resume dialogue. If something like that (the attack) happens, then it's a way of blocking the process," Fall said. Somalia expert Matt Bryden said the blast seemed to be the work of Islamic radicals, possibly from the Islamist movement's youth Shabab wing. "This is just another notch in the escalation between the two sides," he told Reuters. "I think all indications are that the two sides are prepared for a confrontation, it's just a matter of time." (Additional reporting by Katie Nguyen and Andrew Cawthorne in Nairobi)
