Egypt Plays Host As Great Satan Eyes Up Axis of Evil

Close to 60 different flags are flying in the hot sunshine of Sharm el-Sheikh as an international conference on Iraqi stabilisation and security gets under way today.

Iraq's neighbours are here in force and being urged to do more to help as the US and Britain hone their exit strategies. But no one is betting that it will have much immediate effect on the mayhem in Iraq.

Nouri al-Maliki, the Shia prime minister of Iraq, is leading his country's delegation to the two days of talks in the Egyptian Red Sea resort and is hoping that a combination of multilateral support and greater regional goodwill can help provide some light at the end of a very dark tunnel.

The hosts are leaving nothing to chance. The conference centre is ringed by black-uniformed commandos posted at hundred-yard intervals. Bemused tourists on their way to the beach or scuba diving off the coral reefs gawp at the motorcades of besuited VIP's whizzing past.

Noone has forgotten that al-Qaida suicide bombers recruited amongst the Sinai Bedouin shattered the holiday calm in 2005, though Sharm has kept its reputation for peacemaking, holding Arab-Israeli summits at various moments of crisis. Making progress on Iraq, though, is even harder.

The good news is likely to include Saudi Arabia - suspicious of the Shia regime in Baghdad - agreeing to write off an $18bn (£9bn) chunk of Iraq's huge foreign debt, much of it reparations for the invasion of Kuwait in 1990. It is hoped that the United Arab Emirates will follow suit.

The background to all this is the grandly named International Compact for Iraq, an initiative co-chaired by the UN, the World Bank and Iraq itself. It aims to build a framework for security, good governance and regional economic integration with the ambitious goal of a stable and prosperous Iraq within five years.

Diplomats say this is important stuff but admit it sounds like pie in the sky in the context of unending sectarian strife and the daily attacks on coalition forces. "It's probably wishful thinking to see a connection between this and what's happening on the ground," agreed one Arab official. Such scepticism has led to low expectations of what can be achieved.

But parts of the compact make good sense: the 42-page document includes a revenue-sharing oil law, a law to allow members of the now banned Ba'ath party back into public life, and an elections law that will set a date for provincial polls; the hope is that these "benchmarks" will help promote reconciliation by drawing Sunnis away from the insurgency and back into politics.

The broader purpose of the conference is to talk about what is at stake, for Iraq and the region, on the clear if unspoken assumption that the Americans and British are on their way out and that the neighbours need to more to help clear up the mess.

"The most important message that I will be delivering is that a stable, unified and democratic Iraq is an Iraq that will be a pillar of stability in the Middle East and an Iraq that is not stable and not an Iraq for all people will be a source of instability," Condoleezza Rice, the US secretary of state, told reporters on her way over from Washington.

The big hope is that Syria and Iran can be persuaded to play a more constructive role and end their support for the Sunni insurgency and Shia militias respectively. But the pre-conference messages from Damascus and Tehran - attacking US policy and repeating calls for an immediate withdrawal - are hardly encouraging.

The big event at Sharm al-Sheikh is expected to come tomorrow. Nothing has yet been finalised, but that is the likely moment for talks between Dr Rice and her Iranian counterpart, Manuchehr Mottaki, the highest-level encounter between Washington and Tehran for close to 30 years. That will be billed as "the axis of evil meets the great Satan," though the symbolism - like that of the entire conference - could turn out to be greater than any substance.