Sudan's transitional government said it has signed a deal with the families of the victims of the 2000 bombing of the USS Cole in Yemen, meeting a key condition for removing the country from Washington's terrorism blacklist.

Sudan's justice ministry said a deal had been signed with the families of the victims of the attack, but it did not specify the amount of compensation agreed.

"As part of the transitional government's effort to remove Sudan from the terrorism list, a deal has been signed on February 7 with the families of the victims of the USS Cole incident," the ministry said.

"The deal clearly specifies that the government of Sudan was not responsible for the incident or any such terrorist incident and it is doing this deal only to ... fulfil the condition put by the American administration to remove Sudan from its terrorism list."

The United States has set certain benchmarks that Sudan has to meet to be removed from its state sponsor of terrorism list, which includes North Korea, Iran and Syria. Compensating the victims of the USS Cole attack had been a key condition imposed by the US administration.

On October 12, 2000, a rubber boat loaded with explosives blew up as it rounded the bow of the guided-missile destroyer, which had just pulled into Yemen's port of Aden for a refuelling stop.

Seventeen American sailors were killed as well as the two perpetrators of the attack claimed by Al Qaeda, in an early success for the terror group and its founder Osama bin Laden.

A US court ruled that Sudan, where the two bombers were trained, was responsible for the attack – a claim Khartoum always denied.

In 2012, a Washington judge ordered Sudan to pay more than $300 million (Dh1.1billion) to the victims' families. Other judges went on to order certain banks to make Sudanese assets available to start paying the sum.

But in March last year the US Supreme Court overturned on procedural grounds a lower court's ruling ordering Sudan to pay damages to the families of the victims.

Sudan's justice ministry did not specify the structure or any other details of the deal signed last week.

In 1993, Washington listed Sudan on its terrorism blacklist for its alleged support of Islamist groups. Bin Laden lived in Sudan from 1992 to 1996.

Sudan's new authorities have made it a key priority to get the country removed from the blacklist.

Officials in Khartoum say the country's economic revival has been stunted primarily due to its blacklisting, which deters global investors.

In October 2017, the US lifted its decades-old trade embargo imposed on Sudan, but kept the country on the terrorism blacklist.

Sudanese businessmen and officials complain that the blacklisting has restrained international banking and transfer of funds, severely affecting the country's economy.

Sudan's chronic economic troubles – led by high inflation as well as shortages of fuel and foreign currency – was the main trigger for nationwide protests that led to the military's removal of president Omar Al Bashir last April.

In another step restoring Sudan's international standing, the government said earlier this week that it had agreed to hand Al Bashir to the International Criminal Court to face trial on charges of war crimes and genocide during the fighting in the western Darfur region.