Iraq will offer the U.S. a long-term troop presence in Iraq in return for U.S. security guarantees.
The proposal, described to The Associated Press by two senior Iraqi officials familiar with the issue, is one of the first indications that the United States and Iraq are beginning to explore what their relationship might look like once the U.S. significantly draws down its troop presence.
In Washington, President Bush's adviser on the Iraqi war, Lt. Gen. Douglas Lute, confirmed the proposal, calling it "a set of principles from which to begin formal negotiations."
As part of the package, the Iraqis want an end to the current U.N.-mandated multinational forces mission, and also an end to all U.N.-ordered restrictions on Iraq's sovereignty.
In a televised address Monday, Prime Minister Nouri al-Maliki said his government will ask the U.N. to renew the mandate for the multinational force for one final time, with its authorization to end in 2008. He insisted that the U.N. remove all restrictions on Iraqi sovereignty.
Iraq has been living under some form of U.N. restriction since the Iraqi invasion of Kuwait in 1990, the officials said.
U.S. troops and other foreign forces operate in Iraq under a U.N. Security Council mandate, which has been renewed annually since 2003. Iraqi officials have said they want that next renewal - which must be approved by the U.N. Security Council by the end of this year - to be the last.
The two senior Iraqi officials said Iraqi authorities had discussed the broad outlines of the proposal with U.S. military and diplomatic representatives. The Americans appeared generally favorable subject to negotiations on the details, which include preferential treatment for American investments, according to the Iraqi officials involved in the discussions.
The two Iraqi officials, who are from two different political parties, spoke on condition of anonymity because the subject is sensitive. Members of parliament were briefed on the plan during a three-hour closed-door meeting Sunday, during which lawmakers loyal to radical cleric Muqtada al-Sadr objected to the formula.
Preferential treatment for U.S. investors could provide a huge windfall if Iraq can achieve enough stability to exploit its vast oil resources. Such a deal would also enable the United States to maintain leverage against Iranian expansion at a time of growing fears about Tehran's nuclear aspirations.
At the White House, Lute said the new agreement was not binding.
"It's not a treaty, but it's rather a set of principles from which to begin formal negotiations," Lute said. "Think of today's agreement as setting the agenda for the formal bilateral negotiations."
Those negotiations will take place during the course of 2008, with the goal of completion by July, Lute said.
The new agreement on principles spells out what the formal, final document will contain regarding political, economic and security matters.
"We believe, and Iraqis' national leaders believe, that a long-term relationship with the United States is in our mutual interest," Lute said.
From the Iraqi side, Lute said, having the U.S. as a "reliable, enduring partner with Iraq will cause different sects inside the Iraqi political structure not to have to hedge their bets in a go-it-alone-like setting, but rather they'll be able to bet on the reliable partnership with the United States."
When asked about the plan, U.S. Embassy spokeswoman Mirembe Nantongo noted that Iraqi officials had expressed a desire for a strategic partnership with the U.S. in a political declaration in August and an end to the U.N.-mandated force.
"Thereafter then, the question becomes one of bilateral relationships between Iraq and the countries of the multinational forces," she said. "At that point we need to be considering long-term bilateral relationships and we're following the Iraqi thinking on this one and we agree with their thinking on this and we'll be looking at setting up a long-term partnership with different aspects to it, political, economic, security and so forth."
She said any detailed discussion of bases and investment preferences was "way, way, way ahead of where we are at the moment."
The Iraqi officials said that under the proposed formula, Iraq would get full responsibility for internal security and U.S. troops would relocate to bases outside the cities. Iraqi officials foresee a long-term presence of about 50,000 U.S. troops, down from the current figure of more than 160,000.
Haidar al-Abadi, a senior Dawa member of al-Maliki's Dawa party, told Alhurra television that the prime minister would write parliament in the next few days to tell lawmakers that his government would seek the renewal of the U.N. mandate for "one last time."
Al-Abadi said the Iraqi government would make the renewal conditional on ending all U.N.-mandated restrictions on Iraq's sovereignty.
The Iraqi target date for a bilateral agreement on the new relationship would be July, when the U.S. intends to finish withdrawing the five combat brigades sent in 2007 by President Bush as part of the troop buildup that has helped curb sectarian violence.
On Sunday, Iraq's Shiite vice president hinted at such a formula, saying the government will link discussions on the next extension of the U.N. mandate to an agreement under which Iraq will gain full sovereignty and "full control over all of its resources and issues."
Vice President Adil Abdul-Mahdi said Iraq wanted an "equal footing" with the U.S. on security issues as a sovereign country so Iraqi could "have relations with other states with sovereignty and interests."
He said the government would announce within days a "declaration of intent" that would not involve military bases but would raise "issues on organizing the presence of the multinational forces and ending their presence on Iraqi soil."
One official said the Iraqis expect objections from Iraq's neighbors. Iran and Syria will object because they oppose a U.S. presence in the region.
Egypt and Saudi Arabia will not like the idea of any reduction in their roles as Washington's most important Arab partners.