Moussa Faki Mahamat, the chairperson of the African Union Commission, issued a statement on Wednesday saying he is following with deep concern the escalation of military confrontation in Ethiopia.

Mahamat urged parties to the conflict to engage in dialogue to seek a peaceful solution in the interests of the country. This comes after reports Ethiopia's capital Addis Ababa could be overrun by rebels within months, if not weeks.

"The chairperson calls for the immediate cessation of hostilities, the full respect for the life and property of civilians, as well as state infrastructure," Mahamat said.

He told parties to caution their supporters against acts of reprisal against any community, and refrain from hate speech and incitement to violence and divisiveness.

"The chairperson calls on the parties to engage with the AU High Representative for the Horn of Africa, former Nigerian President Olusegun Obasanjo."

The statement came a day after Abiy Ahmed, Ethiopia's prime minister, announced a nationwide state of emergency on Tuesday amid escalating conflict in the northern part of the country.

Mahamat urged all parties to safeguard the territorial integrity, unity and national sovereignty of the Federal Republic of Ethiopia. He reminded parties of their international obligations regarding compliance with international humanitarian and human rights law, with particular regard to the protection of civilians and ensuring access to humanitarian assistance by communities in need.

The Tigray People's Liberation Front, which has been fighting Ahmed's government for a year, has claimed significant territorial gains in recent days.