FILE PHOTO: Eritrea's President, Isaias Afwerki talks to Ethiopia's Prime Minister, Abiy Ahmed during the Inauguration ceremony marking the reopening of the Eritrean Embassy in Addis Ababa, Ethiopia July 16, 2018. REUTERS/Tiksa Negeri

ABU DHABI (Reuters) - The United Arab Emirates hosted the leaders of Ethiopia and Eritrea on Tuesday, lauding their “bold and historic” rapprochement as enhancing prospects for peace and prosperity.

The long-time rivals signed an agreement earlier this month to restore ties, ending two decades of hostility since conflict erupted in 1998.

The UAE played a role in bringing the two sides together, the government said last week, without disclosing the extent of its involvement.

The UAE, along with other Gulf Arab states, has taken an increasingly active role in the Horn of Africa and has set up military bases and commercial ports in several countries there.

Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed al-Nahyan said after meeting Ethiopian Prime Minister Abiy Ahmed and Eritrean President Isaias Afwerki that their agreement would enhance security in the Horn of Africa and wider region.

“We are confident that this step will contribute to further cooperation & joint coordination between the neighbors & fulfill their people’s aspirations for peace, development & prosperity ...” he said in a post on Twitter following the meeting in the UAE capital.

“The bold & historic step taken by the leaders of the two neighboring countries to end the conflict and open new horizons for cooperation and joint coordination is a model that can be followed in resolving conflicts around the world.”

Triggered by a border dispute in 1998, the conflict killed more than 80,000 people. At least 350,000 people living along the border on both sides were uprooted and forced to flee.