BAGHDAD, April 13: Guerillas holding three Japanese hostages in Iraq have reneged on a decision to free them after Prime Minister Junichiro Koizumi called them "terrorists", a religious figure whose organization had called for the release said on Tuesday.

"We had issued a call for their release and they were about to be freed, but then we learned (the abductors) changed their minds because the Japanese prime minister called them terrorists," Sheikh Abdel Salam al Kubaissi told reporters.

"Saying these things is really counter-productive; it adds obstacles," said Sheikh Kubaissi, from the Committee of Muslim Scholars. The committee was not involved in mediating the releases of foreign hostages, but Sheikh Kubaissi said its plea had been heeded by abductors.

"They do not consider themselves as terrorists, but resistance fighters defending themselves and their nation against occupation and aggression," he said. On April 9, a day after the three Japanese were kidnapped, Mr Koizumi vowed not to pull troops out of Iraq as the abductors had demanded, saying "we must not yield to terrorists' foul threats".

A previously unknown group, the "Mujahedeen Brigades", had threatened to burn the hostages alive. A Monday-afternoon deadline for the first of the hostages to be killed passed without any news on the trio's fate.

Mezher Dulaimi, a self-declared Iraqi mediator and a senior member of a powerful tribe, said "the negotiations are difficult but we have made an achievement in guaranteeing that they would not be executed and would be well treated until the end of the negotiations". -AFP