Yemen's president has ordered the reinstatement of hundreds of senior army and intelligence officers sacked after a 1994 civil war, to hasten reconciliation talks aimed at ending years of political turmoil in the US-allied country.

The officers are from the restive south of the Arabian peninsula country, which lost a 1994 civil war with the north after making a failed bid to break away from what many southern secessionists called political domination by Sanaa.

The move by President Abd-Rabbu Mansour Hadi, reported by state news agency Saba, follows a decision last week to set up a $1.2 billion fund to finance the restoration of jobs to tens of thousands of southern Yemenis unemployed since the civil war.

Saba published a series of presidential decrees late on Wednesday listing hundreds of officers from the rank of captain and up as reinstated immediately. Many were promoted.

The decrees covered officers from the armed forces, the Interior Ministry and the intelligence service.

The fund, and other moves that included setting up a 16-member committee equally divided between northern and southern Yemen to tackle the future of southern Yemen in the country, may help bring southern secessionists back into the dialogue more than eight weeks after reconciliation talks halted.

Restoring stability to Yemen, which shares a long border with top oil exporter Saudi Arabia, has been an international priority for many years

As well as southern demands to restore the formerly Marxist state that merged with north Yemen in 1990, northern Shi'ite Muslim rebels are seeking to restore the Zaidi imamate that ruled much of modern Yemen before it was overthrown in 1962.

The sacking of the officers, along with tens of thousands of civil servants, the seizure of private lands and the confiscation of state property of the former south Yemen, had been a sore issue fuelling demands for secession. - Reuters