The United Nations should threaten to impose sanctions on Sudan because of human rights abuses in Darfur, UN Secretary General Kofi Annan has said.
Some two million people have fled their homes in Darfur
He said that he had seen a UN report on whether genocide had been committed and it would be published shortly.
Mr Annan was speaking to more than 40 African leaders at the African Union summit in the Nigerian capital, Abuja.
The AU has some 1,400 troops and monitors in Darfur but they have not been able to stop the fighting.
More than 70,000 people have been killed and some two million people fled their homes in the two-year conflict between black African rebels and pro-government Arab militias.
Last week, a government plane reportedly bombed a village killing some 100 people, mostly women and children.
Sudanese Interior Minister Abdel Rahim Mohamed Hussein told Reuters news agency that the incident was being investigated.
"Armies all over the world have committed mistakes and it is possible that an isolated bombing took place. If this is so, we will punish the offenders," he said.
Darfur is one of the issues being discussed at the two-day AU summit, along with reducing poverty, UN reform and the conflicts in Democratic Republic of Congo and Ivory Coast.
The heads of state have decided to retain Nigeria's President Olusegun Obasanjo as leader of the AU for another year, the AFP news agency reports. They also decided to hold their next half-yearly summit in July in Libya while the January 2006 meeting will be staged in Sudan, to coincide with the 50th anniversary of its independence.
Mr Annan said that "action will have to be taken," to end the Darfur conflict.
"The [UN Security] Council had considered sanctions and had not been able to move forward because of some divisions in the Council. But I believe that sanctions should still be on the table," he said.
The United States has pushed for sanctions to be imposed on Sudan if the violence does not end but this has been opposed by China and Russia, which have economic ties to the Sudan government.
Africa remains blighted by conflict and poverty
The Darfur rebels have appealed for a peacekeeping force strong enough to disarm the Arab militias, accused of systematic killings and mass rape.
Mr Annan also warned that Africa was "not on track" to meet development goals set five years ago.
Then, members of the UN pledged to halve the number of people living in poverty, reverse the spread of Aids and provide basic education by 2015.
"It lags behind other parts of the developing world ... It continues to suffer from the tragic consequences of deadly conflict and poor governance," Mr Annan said.
Enhancing African standing at the UN is also expected to be discussed at the summit.
Nigeria is at the forefront of African states vying for a permanent seat on an expanded UN Security Council.
Draft resolutions and topics for debate have been hammered out by officials and government ministers over the past few days, but the final agenda will be decided by the delegates themselves.
The 53-member AU was set up in 2002 to help promote unity and peace and encourage prosperity on the African continent.