(Recasts after U.N. interview, previous PARIS)
By Paul Tait
BAGHDAD, Jan 16 The United Nations envoy to Baghdad said on Wednesday he would present a positive picture of progress in Iraq in a report to the Security Council despite earlier having serious misgivings about reconciliation efforts. U.N. envoy Staffan de Mistura said the passing of a key law allowing former members of Saddam Hussein's Baath Party to return to government jobs had changed what had been a pessimistic view of progress in a crucial year for Iraq.
"At the beginning of the year we were worried ... we were genuinely concerned by the lack of progress on national dialogue," de Mistura told Reuters by telephone.
"Today that has substantially changed. It has changed our mind from being worried or from being pessimistic," he said.
That view was echoed on Tuesday by visiting U.S. Secretary of State Condoleezza Rice, who said it was a time of hope because of a "spirit of cooperation" between Iraq's ethnic and religious groups.
The law on reintegrating former Baathists passed on Saturday. It was the first in a series of bills Washington has pressed the Shi'ite Islamist-led government to pass to draw minority Sunni Arabs who held sway under Saddam back into the political process.
De Mistura had said in an interview with France's Le Figaro newspaper, published earlier on Wednesday but conducted almost a week before the bill was passed, that Iraq's sectarian groups lacked any true spirit of reconciliation.
He said in that interview that Iraq was running out of time and had six months to overcome distrust between the Shi'ite-dominated cabinet and Sunni Arabs and make political progress or risk a swift return to violence.
The passage of the bill was even more encouraging because it came at a time of sustained security improvements, de Mistura said, with attacks across Iraq down by 60 percent since 30,000 extra U.S. troops became fully deployed last June.
"The current dialogue we are seeing between the government and Sunnis is also encouraging," de Mistura said, referring to efforts to get the main Sunni Arab bloc to return to the government, from which it withdrew last August.
De Mistura said he would leave later this week to deliver a progress report to the Security Council.
"We are going to compliment the government," he said.
The government must nevertheless press ahead with reconciliation efforts and pass other key laws, including a revenue-sharing oil law and a provincial elections law, he said.
"Iraq needs to maintain the momentum, 2008 is going to be a crucial year," he said.
De Mistura told Le Figaro that progress was needed, otherwise insurgents would be tempted to return to violence.
"Iraq will not be the same country at the end of 2008: the U.S. officials will have changed...the international community will have modified its positions," he told the newspaper. (Additional reporting by Anna Willard in Paris; editing by Tim Pearce)