Retired Gen. Jay Garner told a news conference in Baghdad that some Iraqi government ministries were on the verge of reopening. Initially, experts from the United States and other countries will work jointly with Iraqis.
"When Iraqis themselves are ready to accept the management, we will turn it over to them," Garner said. "It is very important that people start back to work, especially those in public service."
Asked if officials who served the ousted regime could work in the interim government, Garner replied, "We will identify anyone who was a crony of Saddam Hussein or a violator of human rights and he will be disqualified. Beyond that I don't think there will be disqualifications."
Garner spoke to reporters after meeting with about 60 Iraqi technocrats and academics. On his agenda were law and order initiatives, and the question of how people in Baghdad would prefer to choose new municipal leadership.
In other developments:
However, Knight Ridder Newspapers reported Thursday that Baghdad hospital workers saw Ali Hassan al-Majid — known as "Chemical Ali" for his use of poison gas against Iraq's Kurds — alive a day or two after the airstrike that purportedly killed him in the southern city of Basra.
Along Iraq's border with Iran, U.S. Marines have begun patrols designed to apprehend fleeing Iraqi officials, help Iraqi exiles who are returning home, and block the entry of potential troublemakers.
Iran has many supporters in southern Iraq, particularly Shiite Muslims who see themselves philosophically aligned with the Shiite government in Tehran, the intelligence official said. This includes several Iraqi clerics whom the Iranians appear to be promoting.
While some Iranians have crossed into southern Iraq, most of the Iranian agents are themselves Iraqis, the official said.
Garner said Thursday that recent demonstrations protesting the U.S. presence in Iraq have been influenced by Iran but predicted they will soon subside.
"Those are well organized. I think what you find in that is a lot of Iranian influence," Garner said.
White House spokesman Air Fleischer said Wednesday that the U.S. had "made clear to Iran that we would oppose any outside organization's interference in Iraq, interfering with their road to democracy."
"Infiltration of agents to destabilize the Shia population would clearly fall into that category," Fleischer said.
A key figure in Iraq with ties to Iran is the Ayatollah Mohammed Baqir al-Hakim, who leads the largest exile group that opposed Saddam, the Tehran-based Supreme Council for the Islamic Revolution in Iraq.
The ayatollah's brother, Abdel Aziz al-Hakim, who commands the group's armed wing, has returned to Iraq and has been seen with crowds of supporters in several southern cities.
He told Qatar-based Al-Jazeera television on Wednesday that the group opposes any foreign presence in Iraq. Its fighters — the Badr Brigades — are present around Iraq but have been ordered not to confront U.S. forces, he said.
The group boycotted a U.S.-led meeting near the southern Iraqi city of Nasariyah last week that was meant to pave the way for a new administration.
The Washington Post reports that the Bush administration wants an interim Iraq authority to take over the administration of the country by June 3, the day the United Nations oil-for-food program expires.
Annan said he hopes "the coalition will set an example by making clear that they intend to act strictly within the rules" governing the occupation of conquered nations.
U.S. officials said they had not yet established whether the coalition is the occupying power under international law but stressed that coalition forces were abiding by international conventions.
"We've made it clear from day one of this conflict through our actions," said U.S. envoy Kevin Moley. "We find it — at best — odd that the secretary-general chose to bring this to our attention."