Somalia's government says its forces have retaken a town near the Kenyan border from Islamist insurgents.

The ministry of information says government troops seized control of Bula Hawo on Sunday after attacking and defeating fighters from the militant group al-Shabab.    

More clashes are reported in Beledweyne, a town on the Somali-Ethiopian border.  The government says the fighting stems from an offensive aimed at retaking al-Shabab-controlled towns in three different regions.

Officials say 11 al-Shabab fighters and one government soldier were killed in the Bula Hawo fighting.  The troops were led by a Somali parliament member, Barre Hirale, who has led a clan-based militia in the past.  

Al-Shabab and its allies control large parts of southern and central Somalia but appear to have lost ground in recent weeks.

A major al-Shabab offensive against government and African Union troops in Mogadishu fizzled, and the AU mission later said it had retaken nearly half of the capital from the insurgents.  The setbacks follow an apparent rift in al-Shabab's leadership.  

Meanwhile, al-Shabab has banned the transfer of cash by mobile phone in the areas under its control.  The group says the practice enables Western interference in the Somali economy.

In a country where security is often lacking, many Somalis use the mobile phone services to pay bills, buy goods and send money to relatives.

Somalia has dealt with nearly two decades of violence and lawlessness since the fall of the last stable central government.  The current government, which has been wracked by infighting, has stayed in power only with the strong support of the AU peacekeepers.

African leaders are discussing plans to expand the AU force, which currently numbers about 7,000 troops from Uganda and Burundi.

Uganda has said it could bring the force's strength up to 20,000 troops if other parties can provide the funding, logistics, and equipment.

Some information for this report was provided by AFP.