The deal was announced a day after Ethiopia's new reformist prime minister, Abiy Ahmed, flew down to Eritrea and embraced its veteran president, Isaias Afwerki, on the runway in Asmara.
The leaders of Ethiopia and Eritrea met each other on Sunday morning in Eritrea's capital Asmara in a historic summit that could bring an end to a near 20-year military stand-off, Reuters reported.
It has been close to two decades since leaders of the two neighbouring countries have met.
The meeting was the first of its kind between leaders of the two Horn of Africa neighbors since their war 1998-2000 war in which around 80,000 people died.
Eritrea won independence from Ethiopia in 1993 after a lengthy conflict.
The regional bloc known for mediating South Sudan's ongoing peace talks, the Intergovernmental Authority on Development, lauded the dramatic diplomatic breakthrough between Ethiopia and Eritrea and praised Abiy for "wise and courageous leadership in. normalizing relations between Ethiopia and Eritrea".
In June, there were protests in Ethiopia near the border when the prime minister first hinted that Badme could become part of Eritrea.
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"This call to protest on the Dan Ryan, however well-intentioned, is reckless", Illinois State Police Director Leo Schmitz said . Police had warned earlier this week that any pedestrian who entered the expressway would face arrest and prosecution.
In a further sign of warming ties, direct worldwide phone calls have been restored between the two countries for the first time in more than 20 years, the Ethiopian prime minister's office said.
The sudden rapprochement will spell an end to a years-long cold war that has hurt both countries. He said the Ethiopian leader's visit was "history in the making" and had "set the tone for rapid, positive changes". Full-blown fighting ended in 2000, but their troops have faced off across their disputed frontier ever since.
Mr. Abiy, in a speech to an official dinner on Sunday night, said the two countries will reopen their embassies, allow visits and clear the way for direct flights and telephone calls, while Ethiopia will gain access to Eritrea's strategically important Red Sea ports.
The historic meeting came after Abiy's announcement last month that Ethiopia would cede to Eritrea land along the countries' border it occupies in violation of a 2002 United Nations-backed boundary demarcation. He did not identify which port.
The 41-year-old Ethiopian Prime Minister, who took office in April, has introduced a series of far-reaching reforms that have transformed Ethiopia's authoritarian regime in the past three months. He has pardoned dissidents, lifted a state of emergency and pledged to partly privatize key state-owned firms.
In more unprecedented actions, thousands Eritreans took to the streets to welcome Abiy, footage from Eritrea's state TV showed, and the streets of the capital of one of the world's most isolated nations were lined with Ethiopian flags.
Eritrea may have seen an opportunity in Abiy's reform agenda, which marks a stark departure from the approach of the Tigrayan People's Liberation Front (TPLF), the ethnic Tigrayan party that had dominated Ethiopia's ruling EPRDF coalition since the early 1990s.
Authorities are responding to an aviation crash, possibly involving a helicopter, in a residential area in Virginia. The crash happened near the College of William and Mary Dillard Complex, prompting an alert from the university.
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