* Al Qaeda group claims responsibility for attack
* Hotel in attack is frequented by Westerners
* Attack presents challenge for new president Kabore
* Security forces begin assault to retake hotel
* Fire brigade sees 10 bodies on restaurant terrace

At least 20 people died and others were taken hostage when suspected Islamist gunmen stormed a hotel in the capital of Burkina Faso and al Qaeda in the Islamic Maghreb (AQIM) has claimed responsibility.

Security forces began an assault to reclaim the Splendid Hotel in the early hours of Saturday and entered its lobby, part of which was on fire, said a Reuters witness, who later saw them enter the hotels upper floors amid bursts of gunfire.

The hotel is frequented by Westerners, which may have made it a target for the militants.

About 30 hostages including the labour minister were freed while around 33 people have been taken to hospital with injuries, said Minister of Communications Remis Dandjinou. No one has said publicly how many people might be in the hotel.

The Friday evening attack was the first time militants have assaulted the capital of Burkina Faso and comes as a setback to efforts by African governments, France and the United States to prevent attacks that have destabilised the region.

It follows a raid on a luxury hotel in Mali last November in which two attackers killed 20 people, including citizens of Russia, China and the United States. There have been many attacks by militants in other countries in West Africa in recent years and the vast majority of those killed have been Africans.

Robert Sangare, director of Ouagadougou's university hospital centre, said that among an initial 15 people brought to hospital some had bullet wounds while others had injuries from falls.

The doctor spoke to patients who had seen around 20 bodies, and one European woman being treated at the hospital said the attackers appeared to target Westerners, said Sangare, who had spoken to the patients.

Burkina Faso's fire brigade saw around 10 bodies on the terrace of the Cappuccino cafe opposite the hotel, the Interior Minister told Reuters. It was not immediately clear how many people were in the hotel and restaurant when the attack began.

The hotel is sometimes used by French troops with Operation Barkhane, a force based in Chad and set up to combat Islamist militants across West Africa's vast, arid Sahel region. Burkinabe and French forces were working together to retake the hotel, the minister of communications said.

A US defense official said France, the former colonial power, had requested US intelligence surveillance and reconnaissance support in the city, and at least one US military member in Burkina Faso was giving ‘advice and assistance’ to French forces at the hotel.

France normally has up to 200 special forces troops in the country.

STIFF TEST

The assault began around 8.30 p.m. local time, and the attackers torched cars and fired in the air to drive people back from the building. There was an intense gun battle followed by relative quiet, partly because of security forces' preparations for their bid to recapture the hotel.

‘We had just opened and there were a few customers we started to serve when we heard gunshots. ... There were three men shooting in the air,’ said Vital Nounayon, a waiter at a restaurant across the street from the hotel.

‘Lots of people left their cars and motorcycles and ran. (Attackers) set fire to the vehicles. They also fired on the Cappuccino cafe across from the hotel before setting it on fire,’ he said, adding that the attackers wore turbans.

Medical personnel moved the wounded away from the front of the hotel and one civilian was shot dead as the assault began around midnight, a Reuters witness said.

Burkina Faso, a majority Muslim country, has undergone a democratic transition since October 2014 when longtime President Blaise Compaore was overthrown during mass protests.

Elite troops launched a failed coup last September, but the landlocked West African state has been largely spared violence by Islamist militants, unlike its neighbour Mali.

The attack presents a stiff test for President Roch Marc Kabore, who was elected in November as Burkina Faso's first new leader in decades.

WARNING SIGNS

Three Islamist groups including AQIM and al Mourabitoun claimed responsibility for the Mali hotel attack, the most prominent by militants who are based in the north of the country and have staged a series of attacks over the last year.

Al Mourabitoun was also involved in the attack in Ouagadougou, according to the SITE intelligence group.

Islamist militants have staged attacks in a number of West African states bordering the Sahel in recent years.

Boko Haram has been blamed for assaults that have killed thousands in northeastern Nigeria during a six-year insurgency and in 2015 extended its attacks into neighbouring countries Chad, Niger and Cameroon.

Still, before Friday, jihadists' approaches in Burkina Faso had mostly been limited to the fringe of West African nation.

In October 2015 around 50 unidentified gunmen attacked a gendarmerie brigade near the western border with Mali, killing three in an attack the government at the time blamed on the leaders of a failed coup one month before.

And last month the embassy warned French citizens against travelling to a national park in eastern Burkina Faso after reports that Malian jihadists were threatening to kidnap visitors.

Earlier on Friday, the Ministry of Defence said about 20 armed men killed a gendarme and a civilian in an attack in northern Burkina Faso. It was unclear who the attackers were.

French Ambassador Gilles Thibault said he had been informed that a curfew would be in place from 11 p.m. local time (2300 GMT) Friday to 6 a.m. Saturday.

Remis Dandjinou, the communications minister, said on Twitter that the cabinet would hold an extraordinary meeting at 9 a.m. on Saturday.