The gunmen launched an attack on the Splendid Hotel in the business district of Ouagadougou on Friday night, burning some 10 cars outside and firing in the air to drive back people before the arrival of security forces.

According to witnesses, there were four or five armed men involved in the raid. The army has surrounded the building following reports of gunfire and car bomb explosions.

Security forces launched an assault against gunmen, Burkinabe state broadcaster RTB said early Saturday.

An unknown number of other people lost their lives after the attackers targeted the Cappuccino Cafe, located opposite the hotel, which is also popular with Westerners, a worker at the cafe said.

The al-Qaeda in the Islamic Maghreb (AQIM) militant group has claimed responsibility for the ongoing attack on the hotel.

Early on Saturday, French Ambassador to Burkina Faso Gilles Thibault wrote on his Twitter page that a curfew has been put in place in Ouagadougou from 2300 GMT on Friday to 0600 the next day.

Thibault also said the embassy had set up a crisis unit to help more than 3,500 French nationals living in the African country.

Describing the raid on the hotel as a "terrorist attack," the embassy had earlier told French citizens to stay at home and avoid the area.

Hours after the raid, an operation to free the hostages was underway, while part of the hotel was on fire. Burkinabe security forces have reportedly managed to bring out eight hostages from the hotel.