The United Nations' special envoy for Libya has reported "progress" in talks between military representatives of the country's warring parties on efforts to achieve a lasting ceasefire that could include a monitoring role for the world body.

"Progress has been made on many important issues," Ghassan Salame told reporters in Geneva, where the rival sides are meeting, adding that there were still "two or three points of divergence".

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"We are still working on refining our basic draft. I hope that we can have an agreement before we leave" the Swiss city, Salame said on Thursday.

Five senior officers appointed by the UN-recognised Government of National Accord (GNA) and five appointed by eastern-based military commander Khalifa Haftar's self-styled Libyan National Army (LNA) are taking part in the military commission talks.

Salame said the two sides were not meeting face-to-face but engaged in "shuttle diplomacy" with separate meetings.

"If it is easier to have an agreement through shuttle diplomacy, we do not have a problem with that," he said. "I am not here for the picture of the two sides shaking hands."

Salame said the rivals were working out the remaining sticking points in the ceasefire deal, which include the return of internally displaced people, the disarmament of armed groups and ways to monitor the truce.

"The ceasefire agreement is made of a number of issues, and there have been points of convergence on many points. And there are points of divergence."

Salame also said a separate commission dealing with economic affairs between the two sides would meet in Cairo on Sunday and he was hopeful that a political dialogue between them could begin in Geneva on February 26.

The ceasefire talks come amid intensified diplomacy among world powers seeking to end the conflict, which intensified in April last year when Haftar launched an offensive to seize the capital, Tripoli, from the GNA.

Haftar's forces, which control much of Libya's east and south, rely on military assistance from the United Arab Emirates and Egypt, as well as France and Russia.

On the other side, Turkey, Italy and Qatar prop up the Tripoli-based government.

At a summit in the German capital Berlin last month, world leaders committed to ending all foreign interference in the oil-rich country and to uphold a weapons embargo to help end the long-running war.

But Salame said the embargo was being breached with weapons, ammunition and foreign fighters arriving to support both sides in the conflict.