Washington, Oct 8 (IANS): US Secretary of State Hillary Clinton has welcomed the announcement of a peace agreement between the Philippines government and the country's largest rebel group, the Moro Islamic Liberation Front (MILF).

"This agreement is a testament to the commitment of all sides for a peaceful resolution to the conflict in the southern Philippines," Xinhua quoted Clinton as saying in a statement.

"The next steps will be to ensure that the framework agreement is fully implemented," she said.

Clinton urged all parties to work together to "build peace, prosperity and greater opportunities for all the people of the Philippines".

The deal, announced by Philippine President Benigno Aquino III Sunday, was reached after peace talks between the government and the MILF in the Malaysian capital city of Kuala Lumpur.

Under the deal expected to be signed Oct 15, the rebels shall be accorded a larger share of power and wealth in a new autonomous region by 2016.

The new region -- named Bangsamoro -- shall have its vested property rights protected, the basic rights of its minorities and indigenous groups recognized and the law enforcement transferred gradually from the Armed Forces of the Philippines to a reformed police.

The new autonomous region would replace the Autonomous Region of Muslim Mindanao set up two decades ago, which Aquino referred to as a "failed experiment".

In one of Asia's longest-running insurgencies, the 11,000-strong MILF has been waging a battle in the southern Philippines since 1969. Armed hostilities have claimed at least 120,000 lives.