Hassan Sheikh Mohamud, Somalia's new president, has named Abdi Farah Shirdon Saaid as the country's new prime minister, diplomats and a government source said.
Friday's appointment is the first major decision by an administration installed after over 20 years of conflict.
Saaid, a political newcomer, has been a prominent businessman in neighbouring Kenya and is married to Asha Haji Elmi, an influential Somali peace activist.
A Western diplomat said Saaid had a reputation for being above Somalia's notoriously volatile clan politics, similar to the new president, and the news of his appointment would be welcomed by foreign governments.
"Like all the decisions the new president has made so far, this is a good one, and Somalia is on a bit of a roll with the election of (Mohamed Osman) Jawaari as parliament speaker and Mohamud as president," the diplomatic source told the Reuters news agency.
Mohamud, a former academic and a political newcomer himself, was elected president in a secret ballot on September 10, a result hailed by his supporters as a vote for change in the Horn of Africa state ravaged by war and anarchy since 1991.
Saaid's appointment as the prime minister will have to be approved by Somali legislators, diplomatic sources said.
The news comes as Somali and Kenyan troops, aided by African Union peacekeepers, are moving to secure the southern port city of Kismayo which has been under the control of the al-Shabab rebel group.