"He believes such an agreement will constitute a major milestone in Iraq's political transition," his spokesman said in a statement delivered at the noon briefing at United Nations Headquarters in New York.

"The Secretary-General emphasizes that compromise and mutual understanding are critical if the parties are to quickly resolve the remaining issues under consideration," the spokesman added.

With the 15 August deadline to complete the draft constitution fast approaching, Mr. Annan's Special Representative for Iraq, Ashraf Qazi, met this past Tuesday with Iraqi Prime Minister Ibrahim Ja'fari to review progress and obstacles. On the same day, the Security Council held discussions on ways the world body could support the country's ongoing political transition.

Speaking to the press after the Council meeting, Ambassador Kenzo Oshima of Japan, which holds the 15-nation body's rotating presidency for the month of August, acknowledged that the exercise was occurring under difficult conditions and that there were some remaining differences among the broad spectrum of negotiators.

Nevertheless, the Council had received reports of a "good spirit of compromise," and was hopeful that in this final week, all efforts would be deployed to overcome those differences.