By Daniel Wallis
NAIROBI (Reuters) - Africa's top diplomat pushed Kenya'sfeuding parties on Friday to reach a speedy deal after thegovernment agreed in principle to create a prime minister'spost to help end a deadly post-election crisis.
"The weekend will be crucial. We hope that next week we'llhave something which can be agreed," the newly elected chairmanof the African Union Commission, Jean Ping, said in Nairobi.
The opposition has demanded a powerful role as executivepremier for leader Raila Odinga, who accuses President MwaiKibaki of rigging the December 27 poll.
Kibaki's team says he won fairly and accuses the oppositionof instigating riots and ethnic violence that killed 1,000people, displaced 300,000 and wrecked Kenya's image as a stablebusiness, tourism and transport hub.
The government agreed on Thursday to set up a new post ofprime minister. But both sides have yet to thrash out the mostcontentious issue of how much power it will have.
After a late start to Friday's session of talks, both sideswere meeting into the evening at a Nairobi hotel.
Odinga's Orange Democratic Movement (ODM) has withdrawn anearlier call for Kibaki to resign, but is threatening to resumestreet protests if its demands are not met.
"If by Wednesday ... no tangible outcome is achieved fromthe mediation process, party members are hereby called upon toprepare for immediate mass civil disobedience," ODM member ofparliament Ababu Namwamba told a news conference.
Despite the ultimatum, chief mediator Kofi Annan said hewas beginning to see "light at the end of the tunnel".
The government has predicted a deal in days.
Ping, elected at an AU summit in Ethiopia this month, isthe latest in a succession of high-powered visitors who havepushed Kenyan leaders towards common ground.
"I am confident ... things are moving towards a gooddirection," he said after meeting the opposition and Kibaki.
U.S. "ENGAGED"
Pressure has grown on both sides of the political divide toreach a lasting deal to end turmoil that has horrified locals,neighbouring states and world powers alike.
"The most effective way to get these issues solved is forthe leaders to feel pressure from their own people," U.S.President George W. Bush said on his way home from an Africatour where the crisis was on high on the agenda.
"We'll help. We send people over and we'll stay engaged."
Odinga left Kenya on Friday on a private trip to Nigeria,but that was not expected to have a bearing on the talks. Hetold local radio there he was just visiting friends.
Although the east African nation has been relatively calmfor a fortnight, the ODM protests ultimatum has stoked fears ofa resumption of the post-election bloodshed.
Earlier demonstrations often descended into looting andtribal attacks, and were met with a tough police response.
The crisis has laid bare issues of land, ethnicity, wealthand power that have plagued Kenya since British colonial rule,and have often been exploited by politicians since then.
(Additional reporting by Helen Nyambura-Mwaura and WanguiKanina, Editing by Andrew Cawthorne)
(For special coverage from Reuters on Kenya's crisis see:http ://africa.reuters.com/elections/kenya/)
