Less than a week after a previous head of Guinea-Bissau’s navy was assassinated, a former prime minister has taken refuge at the United Nations compound in the capital, Bissau, after the government issued a warrant for his arrest.

"UNOGBIS is making all the necessary efforts in consultation with the local authorities to find an amicable resolution to the problem," the UN Peacebuilding Support Office in Guinea-Bissau said in a statement on Wednesday.

The recent events are the latest sign of ongoing instability in Guinea-Bissau, a tiny, impoverished country that was wracked by a year-long civil war that ended in 1999. The UN has maintained its peacebuilding office in Bissau for the past seven years.

Carlos Gomes Junior, who is also chairman of the former ruling African Party for the Independence of Guinea-Bissau and Cape Verde (PAIGC), recently said on state-run radio that President Joao Bernardo "Nino" Vieira was involved in Navy Commander Mohamed Lamine Sanha’s death. The government said that was the reason behind the arrest warrant.

Unidentified men gunned down Sanha a few metres from his house in Bissau on 4 January. The attack triggered rioting at the weekend in Bissau that left at least one person dead and several others injured after security forces opened fire on them, witnesses said.

"Gomes Junior is just trying to destabilise the country,” said presidential spokesman Bernado Gomes on the independent Radio Pindjiguiti. He called the allegations of Gomes Junior “all lies".

Gomes Junior, a banker and businessman, is an archrival of President Vieira who he had called a "bandit and a mercenary".

The former prime minister did not recognise the results of the elections in 2005 that brought Vieira to power. He served as prime minister from May 2004 until November 2005 when Vieira dismissed him.

"I am fearful with what is going on," said one opposition party leader. He and other public figures said on Wednesday they had received death threats as Guinea-Bissau’s political atmosphere deteriorates.

Sanha had also complained of death threats. He was considered the heir apparent of Ansumane Mane, the former military officer who deposed Vieira in 1999 during the civil war. Authorities detained Sanha briefly last August after accusing him of plotting to topple the government. Mane was killed while allegedly leading an attempted coup in 2000.

In a statement issued on Monday the government condemned Sanha’s assassination and promised to arrest his assassins. Several civil society groups in Bissau said they planned to organise a large demonstration to protest violence and insecurity in the country.

In his last progress report on the work of the UN peacebuilding mission in Guinea-Bissau, former Secretary-General Kofi Annan warned that the country’s reconstruction remained fragile. He said political leaders must demonstrate to potential international donors and other economic partners that they could put national interests ahead of their own and resolve their disputes peacefully.

The International Monetary Fund has been planning a mission to Guinea-Bissau this month to discuss emergency assistance. Donors in November in Geneva pledged to give US $262 million to Guinea-Bissau out of a goal of $538 million.

Lower than expected fees from fishing licenses and poor income from the export of cashew nuts has led to feeble government earnings in recent months.