The bombing - which targeted the prime minister - killed at least six people including two of Somalia's top sports officials after a young female suicide bomber walked into the theatre and blew herself up. Islamist militant group al Shabaab claimed the attack.

"Our hopes for peace faded with yesterday's blast," Omar, the owner of a kiosk, told Reuters. She said she doubted there would be any stability for as long as President Sheikh Sharif Ahmed, a former Islamist commander, remained at the helm of the lawless nation.

"Whenever we get a sniff of peace, explosions take place, wiping out any new-found sense of pleasure," she said.

"Al Shabaab are hated and they are weak, but these officials are sustaining the violence."

The theatre had only reopened its doors for the first time in 20 years in mid March, an event which it had been hoped marked a new chapter in Somalia's history. Instead the attack underscored how fragile any progress is.

Although the authorities have made tangible security gains since the al Qaeda-allied militants pulled out of Mogadishu, the Somali capital, in August the attack showed al Shabaab could return and strike at will.

Speaking at the bomb-damaged theatre, the president said the group's increasing recourse to suicide attacks was a sign of their growing weakness.

Construction sites are mushrooming across the coastal city, cafes are opening, and markets stay open longer into the evening, sometimes under street lights.

But confidence and trust in Ahmed and his United Nations-backed interim government are in short supply on the city's rubble-strewn streets, where most buildings carry the mortar-pocked scars of two decades of civil strife.

Although on the back foot, the rebels are the most powerful of an array of militias spawned by the conflict in Somalia, where armed groups and those with political clout have a history of wrecking attempted settlements and perpetuating instability and famine.

PROMISES FALL ON DEAF EARS

One reason for the lack of political progress is that war and instability are lucrative. Somalia's power brokers, pirate kingpins and business tycoons are reluctant to give up the status quo.

Analysts say many players in Somalia's turmoil find that by sabotaging reform they can continue to reap the spoils of war.

Al Shabaab pulled its fighters out of Mogadishu in August under military pressure from an African Union AU.L force.

While Wednesday's blast demonstrated the militants' continued ability to strike at the heart of the city and government, counter-terrorism experts say they are in a weaker position now than at any other time during their insurgency.

But diplomats worry political reform is not keeping pace with the hard-fought military gains earned in the capital and the south of the country by Kenyan and Ethiopian troops.

For ordinary Somalis, their government's failure to quash al Shabaab's five year insurgency and put an end to widespread corruption and infighting is a painful source of despair.

"I believe the blasts will continue unabated. The government has failed to secure the capital, let alone the entire country," said 22 year-old nursing student Rage Abdullahi.

President Ahmed promised to "redouble our efforts and tighten security" but his rhetoric appeared to have fallen on deaf ears.

"President Sharif has just been making empty promises since he was elected three years ago," Abdullahi said.

On Thursday, the AU's AMISOM force deployed 100 soldiers to Baidoa, the country's third biggest city and a former rebel stronghold in the south that served as a key recruitment and training centre until it fell to Ethiopian forces in February.

It is the first time AMISOM has deployed beyond the outskirts of Mogadishu since the force was launched in early 2007 and marks the first of a series of phases to expand AMISOM operations into new areas of southern and central Somalia.

"(Al Shabaab) are losing ground and losing friends all over Somalia," AMISOM's deputy force commander Brigadier-General Audace Nduwumunsi said in a statement.

A total of 2,500 Ugandan and Burundian troops will eventually be based in Baidoa, 250 km northwest of Mogadishu.

The African Union says Ethiopia will pull its military out of Somalia this month. AMISOM's increased area of operations comes after the United Nations voted in February to expand the force by almost half to more than 17,700 soldiers.

(Additional reporting and writing by Richard Lough in Nairobi; Editing by Andrew Osborn)

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