The Ukrainian government and Russia-backed separatists have begun withdrawing forces from an eastern Ukraine town in a step toward new peace talks with Moscow over the five-year conflict.

At an investment forum on Tuesday in Mariupol, a city near separatist-held areas, foreign minister Vadym Prystaiko said Ukraine was pulling back troops from the contact line in Zolote and would next work toward a similar withdrawal from the town of Petrovske.

Ukrainian forces fired a small white rocket in the air to show their readiness, and troops from the self-proclaimed Luhansk People's Republic answered with their own signal flare, a separatist spokesman said. They fired a green flare as they started pulling back, all under the gaze of observers from the Organisation for Security and Co-operation in Europe. The operation must be completed within three days.

Originally slated for October 7, the joint withdrawal was delayed as both sides accused each other of violating the ceasefire that has frequently been broken since 2015. The Ukrainian military accused the separatists of firing machine guns and grenades at a position near Zolote on Tuesday, but later said the clash occurred outside the withdrawal area.

The Zolote and Petrovske stand-downs were first planned at a meeting in Minsk of representatives of Ukraine, Russia and the separatists as part of an effort by recently elected president Volodymyr Zelenskiy to revitalise the stalled peace process.