Shiite Huthi rebels and forces loyal to former president Ali Abdallah Saleh on Saturday appointed a council set up to govern Yemen, in a new blow to UN-mediated peace talks.

The announcement came as the United Nations prepared to suspend peace talks in Kuwait.

The rebel alliance announced the creation of the council on July 28, a move denounced by Yemen's internationally recognised government.

UN envoy Ismail Ould Cheikh Ahmed said it would damage the talks and represented a "grave breach" of UN Security Council Resolution 2216.

The council includes 10 members, equally divided between Huthi and Saleh loyalists, according to a list published by the Huthi-controlled Saba news agency on Saturday.

They include Salah al-Sammad, head of the Huthis' political wing Ansarullah, and Sadek Abu Ras, deputy head of Saleh's party, the General People's Congress.

Ould Cheikh Ahmed is expected to announce the suspension of the talks on Saturday in Kuwait, in the presence of rebel and government delegations.

The UN envoy told Kuwaiti TV on Thursday that he hopes to relaunch talks in the future.

The talks began on April 21 but broke down last month when the rebels rejected a UN peace plan, saying any settlement must include the formation of a unity government.

That amounts to an explicit demand for the removal of the internationally recognised president, Abedrabbo Mansour Hadi.

The Yemeni government had been ready to accept the UN plan, but its delegation left Kuwait on Monday until the rebels agree to the proposed accord.

The draft plan called on the rebels to withdraw from territories they had occupied and give up heavy weapons they had seized from the army.

The two sides would also exchange prisoners before the launch of political negotiations.

The plan was presented as the UN's final proposal to resolve a conflict that has left at least 6,400 people dead and displaced 2.8 million.

Yemen has been in chaos since the Huthis entered Sanaa in September 2014.

Neighbouring Saudi Arabia, which says the Huthis are backed by Iran, formed a coalition and launched a campaign of air strikes in March 2015 to push the Shiite rebels back.

Despite heavy bombing, the Huthis still control the capital and much of northern Yemen.

Source: AFP