---

By REUTERS
www.reuters.com
Monday, May 5, 2003

---

BASRA, Iraq (Reuters) - Jay Garner, Iraq's U.S. administrator, said on Monday that prominent Iraqis have begun meeting to decide on an interim leadership that could be set up within weeks.

``By the middle of the month, you'll really see a beginning of a nucleus of an Iraqi government with an Iraqi face on it that is dealing with the coalition,'' the retired U.S. general in charge of post-war reconstruction told reporters.

Garner, speaking as he left Baghdad for the southern city of Basra, said he expected up to nine Iraqis to form an interim leadership group that would be a point of contact for the Americans.

The group would be chosen by Iraqis and consist of some returned exiles and some local Iraqis, representing Iraq's broad ethnic and religious spectrum.

Garner said the emerging leadership might include Masoud Barzani, leader of the Kurdistan Democratic Party; Ahmad Chalabi of the Iraqi National Congress; Jalal Talabani of the Patriotic Union of Kurdistan; Ayad Allawi of the Iraqi National Accord; and Abdel-Aziz al-Hakim, a senior official in the Iran-based Supreme Council for Islamic Revolution in Iraq.

``The five opposition leaders have begun having meetings and they are going to bring in leaders from inside Iraq, and see if we can't form a nucleus of leadership as we enter into June,'' Garner said later in Basra.

He said the group would likely be expanded to include, for example, a Christian and perhaps another Sunni figure.

Iraqis are angry at a breakdown in security and public services since U.S. forces toppled president Saddam Hussein last month.

Iraqi preachers demanded on Friday that the United States establish a government to restore order after President Bush declared the war effectively over last week.

RECONSTRUCTION PROGRESS

During Garner's Basra visit, officials announced the appointment of Danish diplomat Ole Wohlers Olsen as southeast Iraq regional coordinator for the U.S. administrative body, the Office of Reconstruction and Humanitarian Affairs (ORHA).

``We have now a very serious job in front of us in the most mistreated part of Iraq,'' Olsen said of the mostly Shi'ite south. Olsen's appointment changes ORHA's original three-region administrative division of Iraq into four regions.

Garner and his team visited Basra general hospital and were due to meet local leaders.

Earlier in Baghdad Garner said Iraq's reconstruction was not as difficult as he had expected, mainly because the war caused less infrastructure damage and fewer refugees than anticipated.

``We started with a glass more half-full than we expected,'' Garner said.

While the U.S.-led war had generally ``preserved the wealth of the nation,'' U.N. sanctions were slowing Iraq's recovery, Garner said. Washington has pushed for U.N. sanctions to be lifted.

L. Paul Bremer, the newly chosen top civil administrator for Iraq, was expected to arrive in Baghdad next week, Garner said.

Bremer, a former U.S. diplomat who headed State Department counter-terrorism efforts, would concentrate on Iraq's political process while Garner would focus on reconstruction.

The appointment of someone like Bremer had been planned all along, Garner said, and Garner himself was always intended to be in Iraq temporarily. ``I'll stay a while. There's got to be a good handoff,'' he said.

Electricity in Baghdad was now running at 50 percent capacity but with the approach of summer it was critical to increase capacity by repairing transmission lines, Garner said.

``The month of May is a key month for getting all the public services stood up or at least with a good prospect of being stood up and getting the law enforcement system back,'' he said.