The decision followed a deal between the military rulers and the Economic Community of West African States (ECOWAS), which will see the West African nation under the interim administration of the speaker of the parliament, Manuel Sherifo Nhamadjo.
The deal will also put in place a 600-man ECOWAS force and fresh elections are expected in 12 months.
“Starting today, the Military Command will hand power to civilians,” the military spokesman, Daha Bana Na Walna, quoted by Reuters, said at a news conference.
Coming weeks after a similar intervention by ECOWAS successfully gave back power to Mali’s civilian leaders after a military coup, the new deal appears to strengthen the bloc’s effort at consolidating democracy within the region.
However, the deal was brokered after the United Nation criticized ECOWAS for not being decisive enough on the Bissau coup leaders as it was on the Malians.
The choice of the parliament speaker to lead Guinea Bissau had earlier been rejected by ousted Prime Minister, Carlos Gomes Jnr’s party, PAIGC.
The Bissau soldiers seized power on April 12, detaining interim president, Raimundo Pereira, and former Prime Minister, Carlos Gomes Jnr, who was the front-runner in presidential elections.
Mr. Gomes Jnr. won nearly 50 per cent of votes in a first-round election in March and was widely expected to win an April run-off.
The coup leaders said repeatedly the coup was aimed at removing the front runner from the election because he allegedly made a secret pact with Angola to eliminate Guinea-Bissau’s military leadership.
Guinea-Bissau has suffered several coups since independence from Portugal in 1974.The nation is reputed as a major international drug trafficking hub.
As prime minister, Mr. Gomes Jnr backed reforms for the army, notorious for drug deals and meddling in politics. He also made attempts at combating cocaine smuggling.