Abraham and Matouq, holding perhaps the highest level US-Libyan meeting since Libya pledged last December to give up making weapons of mass destruction, both stressed the benefits of the Libyan example. The UN watchdog International Atomic Energy Agency (IAEA) has supervised Libya's disarmement since December.

"It hasn't taken very long obviously for Libya's relationships to dramatically change for issues that relate to sanctions and official recognition," Abraham told reporters after the meeting, held at a general conference of the IAEA.

Libya was before December off-limits to Americans for normal travel but US businessmen are now free to travel there as oil business looks set to revive.

"Hopefully, this is a good example to either Iran or anyone else, that following a positive course does not mean that they are isolated but with less it means they are now part of a world community with more opportunity in the future," Abraham said.

Matouq, who said he had invited Abraham to visit Libya, said "I think . . . Libya has set an example for everybody."

He said the idea was "to cooperate with the IAEA to the full extent that it is needed and I think the IAEA has proved with Libya and it might be proving again with the Iran case that it is . . . the right track."

IAEA chief Mohamed ElBaradei reiterated here Monday the IAEA's call on Iran to fully suspend uranium enrichment, despite Tehran's apparent defiance.

His comments came the day after Iran rejected the IAEA resolution calling for a halt to sensitive nuclear work.

Suspending uranium enrichment, the process that makes civilian nuclear fuel but also the explosive core for atomic bombs, is a so-called confidence-building measure that goes beyond requirements laid down by the nuclear Non-Proliferation Treaty (NPT).

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