Iraqi President Barham Saleh nominated spy chief Mustafa Kadhemi on Thursday as the country's third prime minister-designate this year, moments after predecessor Adnan Zurfi ended his bid to form a government.

The nomination ceremony was attended by the country's top political figures, indicating widespread support for Kadhemi that both previous PM-designates had not enjoyed.

Kadhemi, the 53-year-old head of Iraq's National Intelligence Service, has long had close links with the United States but political sources say he has also improved ties with Washington's foe, Tehran, in recent months.

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