By Qassim Abdul-Zahra, Associated Press Writer

The United Arab Emirates canceled billions of dollars of Iraqi debt on July 6 and moved to restore a full diplomatic mission in Baghdad, evidence of Iraq’s improved security and growing acceptance of its Shiite-led government.

The Abu Dhabi government announced the debt relief and the naming of a new UAE ambassador to Baghdad shortly after Iraqi Prime Minister Nouri al-Maliki began a visit to the wealthy Gulf nation.

The news was sure to bolster al-Maliki’s government, which has been urging Iraq’s Sunni Arab neighbors to forgive loans taken during Saddam Hussein’s regime and restore diplomatic relations.

Al-Maliki, who has been in office since May 2006, thanked the UAE for the debt cancellation, telling a meeting with local businessmen that it was a “swift and courageous” decision.

The Emirates’ official news agency, WAM, quoted the country’s president, Sheik Khalifa bin Zayed Al Nahyan, as saying he hoped canceling the debt would lighten the “economic burden” facing Iraqis, who he urged to unite behind al-Maliki’s government.

WAM said the debt was $4 billion not including interest. A UAE official who spoke on condition of anonymity because he was not authorized to speak to the media said the total debt was $7 billion when interest was added.

Iraq has been appealing for relief of at least $67 billion in foreign debt — owed mostly to Arab nations that have been reluctant to forgive Iraq’s belligerence during Saddam Hussein’s regime.

In addition, the U.N. Compensation Commission says $28 billion remains to be paid for Iraq’s 1990 invasion of Kuwait. Iraq now gives 5 percent of its oil revenue to meet the compensation claims.

Al-Maliki’s American backers also have pushed Arab states like the UAE to restore ties with Iraq, where violence has come down by 70 percent over the past year. Jordan, Iraq’s neighbor to the west, has named an ambassador last week, and Kuwait and Bahrain say they will soon follow suit.

Meanwhile, a top Iraqi official said the U.S. has presented Iraq with a proposed list of military facilities Washington wants to maintain control of as part of negotiations between the two countries on a long-term security agreement.

Interior Minister Jawad al-Bolani said the timing for how long the U.S. would control each facility before handing them over to the Iraqis would be based on the security situation in each area. But al-Bolani stressed talks on this issue were ongoing.

“We are still discussing this,” he told The Associated Press aboard the plane carrying al-Maliki as it headed to Abu Dhabi.

The Iraqis, he said, want to take control of the estimated 20,000 detainees in U.S. custody and curb the U.S. military’s authority to arrest Iraqis. No comment was immediately available from the U.S. Embassy, which in the past has declined to comment on the negotiations.

Both sides hope to wrap up the talks on the agreement this month in time for Iraq’s parliament to approve the deal to keep U.S. troops here after their U.N. mandate expires at the end of the year.

Iraq’s deputy foreign minister, Labid Abbawi, said that the country plans to open consulates soon in the U.S. cities of Detroit, Michigan and San Diego, California.

“We chose those two cities because they have large number of Iraqi communities,” Abbawi told The Associated Press.

In Abu Dhabi, Iraqi government spokesman Ali al-Dabbagh confirmed his government was notified of the debt cancellation and said Abdullah al-Shehi, the UAE’s former head of mission in India, was named ambassador to Iraq. The country said last month that an appointment was upcoming.

The UAE withdrew its ambassador to Iraq after the 2003 U.S.-led invasion and after one of its diplomats was kidnapped and later released.

Sunni militant groups like al-Qaeda in Iraq, mistrustful of the government, have warned Arab states not to open embassies in Baghdad. The capital’s first major car bomb of the war struck the Jordanian Embassy, killing 19 people in the summer of 2003. Diplomats from Egypt, Morocco, Bahrain, Turkey, and Sudan have all been either killed, wounded, or kidnapped in Iraq.

Al-Maliki chided his Arab “brothers” at an April conference of Iraq’s neighbors in Kuwait, saying he found it “difficult to explain why diplomatic exchange has not taken place.” Most major Western diplomatic missions in Baghdad are located in the U.S.-protected Green Zone, a large swathe of land on the west bank of the Tigris River.

Violence in Iraq is at its lowest level in four years, but attacks continue.

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