The United Nations chief said on Monday he believed the need for UN sanctions against Eritrea will no longer exist following its peace deal with Ethiopia.

"The sanctions were motivated by a number of events that took place, (but) it is my belief that those events will no longer exist ... If the reasons that led to the sanctions will no longer exist ... they will naturally become obsolete," Antonio Guterres told reporters in Addis Ababa.

Guterres was visiting the Ethiopian capital a day after Prime Minister Abiy Ahmed and Eritrea's President Isaias Afkwerki declared that a "state of war" since a 1998-2000 conflict had given way peace and vowed to restore diplomatic and trade links.