Although ministers representing rebel groups boycotted a swearing-in ceremony on Friday, the deal was seen by observers to be a sign that the vast country was firmly on the road to stability.
After years of intricate negotiations, President Joseph Kabila on June 30 named a transitional government encompassing the several fighting groups, some of whom had in the past made such a government impossible to form.
The Movement for Congolese Liberation (MLC) of Jean Pierre Bemba, and the Rally for Congolese Democracy (RCD-Goma) led by Azarius Ruberwa, both welcomed the new government.
Javier Solana, the European Union's foreign policy chief, who was in East and Central Africa last week, welcomed the new government and pledged the EU's continued support to the Congo's pacification.
"We will continue to support the peace process in DRC," he said. "We are glad to help and we will accompany the Congolese in the entire process."
He said he was optimistic that the new government would tackle the problem of the northeastern Ituri region, where skirmishes between rebel groups and militias have continued to claim lives and displace thousands of civilians.
According to the deal that established the new government and which is expected to culminate in democratic elections in two years, Kabila will head the transition government, while the MLC, RCD-Goma, the unarmed opposition and Kabila's side will each have a vice president.
In addition, each of the four groups will have seven ministers and four deputy ministers.
The transfer of power from the old Cabinet to the transitional one began on July 14 while the first Cabinet meeting was scheduled for July 19.
The new vice presidents took the oath of office on last Wednesday. The committee overseeing implementation of the peace accord and establishment of the transition government set the opening of an extraordinary session of the National Assembly for July 23, while the Senate was scheduled to meet on July 24.
Shortly after President Kabila announced the formation of the new government, the UN Military Observer Mission for Congo (Monuc) said the Rwanda-backed RCD-Goma started withdrawing from Lubero, a town the latter had captured two weeks earlier.
Following the arrival in Ituri last month of the French-led peace force, the RCD-Goma had engaged in battles with the Rally for Congolese Democracy (RCD-ML), a smaller rebel group, for control of a string of towns in eastern Congo. The clashes between the two groups were seen as the biggest threat to peace in the volatile region.
President Kabila said that with the formation of the transitional administration, "The war which still shrouds several parts of the nation has lost its purpose."
The silence of the RCD-Goma and RCD-ML guns seemed to bear him out. Bemba called the creation of the government "the end of the war phase" in Congo. MLC's secretary general Olivier Kamitatu will be the new Speaker of parliament.
In both Kampala and Kigali, the authorities welcomed the transitional government. Uganda Defence Minister Amama Mbabazi described the power-sharing deal as "a step in the right direction."
The UN chief, Kofi Annan, also welcomed the new government saying he looked forward to its inauguration as soon as possible.
EU officials who visited Kinshasa, Kigali and Ituri last week, said in Kampala that the French-led multinational peace keeping force known as "Operation Artemis" had managed to maintain peace in the Ituri region. Ugandan President Yoweri Museveni on his part said the rapid deployment of the multinational force in the area had helped stem hostilities and speed up the formation of the transition government.
The EU force's mandate expires on September 1; the French Army's Chief of General Staff, Gen Henri Bentegeat, who recently visited Uganda and eastern Congo, said they would not seek an extension of their stay.