Iraq announced it was restoring full diplomatic relations with Syria after a 26-year break on Tuesday and hailed a pledge from its western neighbour to do more to cooperate on security.
"We have signed a little while ago an agreement to restore complete diplomatic relations with Syria," Foreign Minister Hoshyar Zebari told a joint news conference with his visiting Syrian counterpart Walid Muallem.
"(The) Iraqi flag will be raised in Syria and the Syrian flag will be hoisted in Baghdad," Zebari said.
The Iraqi minister said agreement had also been reached on closer security cooperation following repeated US accusations that Syria was turning a blind eye to Sunni Arab insurgents smuggling men and materiel across the border.
"There was an agreement to have meetings between security officials from both countries and we also discussed developing commercial relations," he said.
The Syrian minister acknowledged that his talks in Baghdad had been "frank after they (relations) were disturbed all these years."
Saddam Hussein's regime cut ties with Syria in 1980 in protest at its support for Iran after an eight-year war between the two neighbours broke out that year.
Muallem said he hoped the restoration of normal relations would put an end to US criticism of Syria over its role in Iraq.
"I do not want to go back to the former accusations. We seek future cooperation in all fields," he said.
Although Iraqi officials have visited Damascus, Muallem, who arrived Sunday, was the first Syrian official to visit Baghdad since the US-led invasion of 2003.
The rapprochement between the two neighbours comes amid mounting calls for the US administration to engage Syria and its regional ally Iran in efforts to stabilise Iraq three and a half years after the invasion.
British Prime Minister Tony Blair has urged President George W. Bush to rethink US cold shouldering of the two governments and engagement is expected to be among the key options to be proposed by the Iraq Study Group, a US bipartisan panel that is to present its findings early next month.
Iraqi President Jalal Talabani is to travel to Iran Saturday for talks with his hardline counterpart Mahmoud Ahmadinejad and there were some reports that Syrian President Bashar al-Assad might join the meeting.
"There is some expectation that the Syrian president may be present," said Bassem Sharif, an MP for the Shiite bloc, which leads the government.
"There is a real desire to have such a three-way summit and there could be a surprise."
But Talabani's spokesman Hiwa Othman denied that such a summit was in the pipeline.
"There is no such three-way summit in Tehran and our president is looking forward to meet his Syrian counterpart in Damascus at some point of time," Othman said.
Analysts said the rapprochement between Iraq and Syria was likely to add grist to the mill of those pushing for the US administration to engage.
There were elements of Muallem's visit "that will both energise and give more weight to the review here and the argument to engage the Syrians," said Scott Lasensky of the US Institute for Peace, a think tank that has been advising the Iraq Study Group.
But Iraqi Prime Minister Nuri al-Maliki made clear that he still expected to see more action from Syria on security, regardless of the state of its relations with the United States.
"If Syria or any other state has differences with the United States, it's their own business," Maliki told a joint news conference with Muallem on Monday.
"It should settle these differences, but not at our cost," he said.
The Shiite premier has had his own differences with US commanders over the pace of action against Shiite militias accused of infiltrating the security forces.
But early on Tuesday, US and Iraqi forces raided Baghdad's most populous Shiite neighbourhood of Sadr City, a politicallly sensitive stronghold of the Mahdi Army militia of Shiite radical leader Moqtada al-Sadr.
Three people were killed in the raid, security sources said.