Hillary Clinton yesterday announced that all sides in the dispute over Honduras' recent coup had agreed to mediation, a development Washington hopes will help reduce tensions between Manuel Zelaya, the ousted president, and the country's new de facto government.

Speaking after a meeting with Mr Zelaya, the US secretary of state said that Oscar Arias, the president of Costa Rica, had agreed to serve as a mediator and that Roberto Micheletti, Honduras's acting president, had also accepted the move.