The African Union should facilitate peace talks between Ethiopia's government and rebellious forces from the Tigray region in the north, the country's ruling party told state media on Monday.

The conflict in Ethiopia, Africa's second-most populous nation, has displaced millions of people, plunged parts of Tigray into famine conditions and killed thousands of civilians, since it erupted in November 2020.

Prime Minister Abiy Ahmed said two weeks ago that the federal government had formed a committee to study how they will negotiate with the Tigrayan forces.

After discussing the committee's report, Abiy's ruling Prosperity Party wants the African Union to oversee a peaceful resolution of the conflict, Gedion Timothewos, the justice minister, told the state news agency.

The government, however, stood ready to take action if violence continued, Gideon was quoted as saying by the Ethiopian Press Agency.

He did not provide more details on the report from the committee, which is headed by Deputy Prime Minister Demeke Mekonnen.

It had been given 10-15 days to hammer out details of negotiations and government officials told Reuters last week that its report would be made public.

The Tigray People's Liberation Front (TPLF), a former rebel army turned political party, said it was prepared to participate in a "credible, impartial and principled" peace process, after Abiy announced the formation of the committee.

TPLF spokesperson Getachew Reda did not immediately respond to a request for comment on Prosperity Party's position.

In his role as the AU's Horn of Africa envoy, former Nigerian President Olusegun Obasanjo has been conducting shuttle diplomacy between the two sides.

The federal government later announced a seven-member negotiating committee led by deputy prime minister Demeke Mekonnen.

It includes a security adviser to Abiy, justice minister Timothewos, the head of the national intelligence service and the head of military intelligence.

Two top officials from the neighbouring Amhara and Afar regions, which were heavily affected by the fighting, are also on the committee.