US holds talks with Syria but not Iran as neighbours offer Iraq aid

EGYPT: Efforts to stabilise Iraq by involving its neighbours in talks brought Condoleezza Rice together with Syria's foreign…

EGYPT:Efforts to stabilise Iraq by involving its neighbours in talks brought Condoleezza Rice together with Syria's foreign minister yesterday. But much-heralded talks with her Iranian opposite number, Manouchehr Mottaki, failed to materialise.

The US secretary of state's session with Walid Moualem on the margins of a conference on Iraq followed rare praise from the US military that Syria was doing more to seal its border with Iraq to foreign fighters.

"There has been some movement by the Syrians," Maj Gen William Caldwell said in Baghdad. "There has been a reduction in the flow of foreign fighters into Iraq," he added, for more than a month.

The high-profile diplomatic encounter in the Egyptian resort of Sharm el-Sheikh was the first since Syria was accused of being behind the murder of the former Lebanese prime minister Rafik Hariri in February 2005. US officials insisted that only Iraqi security - rather than broader relations - were discussed.

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Dr Rice confirmed that she would not be meeting Mr Mottaki, though the two did exchange pleasantries during lunch. Mr Mottaki said privately that Muslim custom meant he could not shake Dr Rice's hand.

Prospects for US talks with Iran and Syria overshadowed the conference, which began with an appeal by the Iraqi prime minister, Nuri al-Maliki, for forgiveness of an estimated $50 billion (€37 billion) debt inherited from the Saddam era. Saudi Arabia promised again to write off 80 per cent of the $17 billion it is owed, despite Sunni unhappiness at what it sees as the sectarian character of the Shia-led government.

Debt relief is part of the grandly-named International Compact for Iraq, drawn up by the UN, the World Bank and Iraq, and modelled on what was done for post-Taliban Afghanistan.

Much of it is about economics, investment and reconstruction, but it includes a revenue-sharing oil law, a reversal of "de-Baathification" and setting a date for provincial elections. It is hoped these "benchmarks" will draw Sunnis away from the insurgency.

Meanwhile a retired British army general said Iraq's insurgents were justified in opposing the occupation, arguing that the US and its allies should "admit defeat" and leave Iraq before more soldiers are killed.

Gen Sir Michael Rose told BBC's Newsnight: "It is the soldiers who have been telling me from the frontline that the war they have been fighting is a hopeless war, that they cannot possibly win it and the sooner we start talking politics and not military solutions, the sooner they will come home and their lives will be preserved."

Asked if that meant admitting defeat, the general replied: "Of course we have to admit defeat . . . The catastrophes that were predicted after Vietnam never happened. The same thing will occur after we leave Iraq."