By Jack Kimball

ASMARA, Dec 5 (Reuters) - An exiled leader of Somalia's Islamists has rejected a call by Somalia's new prime minister for talks to try to end 16 years of conflict and stem a year-long insurgency that has killed some 6,000 civilians.

"Our problem is not with the old prime minister or the new prime minister. Our problem is Ethiopia's occupation," Sheikh Sharif Ahmed, who is now chairman of the opposition Alliance For the Re-Liberation of Somalia (ARS), told Reuters.

Ahmed's Islamist courts' movement ruled Mogadishu for six months last year, until it was chased away by Ethiopia's army backing forces from the interim Somali government.

"If the Ethiopian occupation is removed then everything is possible. But before that, it would be fruitless to speak about talks between the prime minister and the opposition," Ahmed added in an interview in Eritrea late on Tuesday.

Prime Minister Nur Hassan Hussein has had a rocky start since being appointed at the end of November and naming his cabinet at the weekend. Five ministers have already quit, in a blow for plans to unify a government paralysed by in-fighting for nearly three years.

Hussein took over from former Prime Minister Ali Mohamed Gedi, who resigned after a long feud with the president that frustrated their Western backers.

On Tuesday, a security official said President Abdullahi Yusuf -- a long-surviving liver transplant patient -- was in "serious condition" in a Nairobi hospital.

But his doctors played down the health threat.

Ahmed, who has been seen as a relative moderate among the Islamists, declined to say what, if any, would be the consequences of Yusuf's illness.

Ethiopia's enemy, Eritrea, backs Sharif's ARS movement, which is an umbrella Somali opposition group of Islamists, former parliamentarians and diaspora members.

Hardline Islamists have led an insurgency against the government and Ethiopian troops throughout 2007. A rights group said this week nearly 6,000 civilians had died in fighting in Mogadishu, which has also seen a massive refugee exodus. (Reporting by Jack Kimball, Editing by George Obulutsa)

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