WASHINGTON, May 7: US Secretary of State Colin Powell and Deputy Defence Secretary Paul Wolfowitz on Friday acknowledged that the prisoner scandal had been "very destructive" and "fundamentally damaging" to US foreign policy aims , particularly in the Middle East.

At the same time, in an interview, Mr Powell maintained confidence that the difficulties would be overcome and said he saw no reason that the furore in the Arab world and elsewhere would affect the transfer of power in Iraq on June 30 or Middle East peace efforts.

"There is no question that these pictures that we have seen ... of misbehavior on the part of American troops makes our work much more difficult," Powell said, referring to graphic photographs of US soldiers abusing Iraqi prisoners in a prison west of Baghdad.

"These images are very destructive to our foreign policy efforts," he said. "We are all distressed by these scenes," Powell said. "They are deplorable, they are unacceptable, they need to be dealt with.

"Justice will be served, there is no question about that. But let's not lose sight of what we're really about, and that is restoring democracy in Iraq." "Certainly, these allegations and the scenes you have seen of what took place in the prison is not helping our case," Powell said.

"That's why we are spending so much time telling the world: 'Let's not lose sight of what we really have to get accomplished in Iraq'."

WOLFOWITZ: The deputy defence secretary said the scandal was "fundamentally damaging" to US efforts to build peace and democracy in Iraq. Mr Wolfowitz, in a speech to the World Affairs Council of Philadelphia, reiterated the Bush administration's stance that the mistreatment of prisoners was "totally unacceptable".