STOCKHOLM, June 9: The invasion of Iraq could incite some countries to acquire weapons of mass destruction to avoid any future invasion by the United States, the Stockholm International Peace Research Institute said in its annual report, released on Wednesday.

The impact of the invasion - justified by the United States by the alleged existence of weapons of mass destructions (WMDs) - on weapons proliferation and terrorism was difficult to assess but there was a risk it would increase demand for powerful weaponry, the SIPRI said.

"Potential proliferators may draw the conclusion that the costs and risks of acquiring WMDs have increased significantly but they may also conclude that the only way to prevent themselves from becoming the victims of regime change is to develop a credible deterrent," SIPRI said.

The US-led forces' experience since its "successful, low-cost occupation" of Iraq has shown the limits of military power when faced with non-traditional tactics, so-called "asymmetric" responses.

"The performance of new military equipment and tactics in Iraq will encourage imitators in some parts of the world," wrote SIPRI head Alyson Bailes. Ms Bailes noted that the main justification for the invasion of Iraq, a supposed threat from WMD, "crumbled" later, undermining the credibility in general of efforts to ensure the non-proliferation of such weapons.

"Many states were motivated to work for less violent solutions," she said. Libya has recently promised to abandon any bids to develop WMD. The most immediate loss from the Iraq conflict was that "any intervention, even non-military, is a gamble for high stakes", Alyson Bailes said.

In addition to the military challenge of Iraq, Washington now also has to fight on diplomatic fronts, attempting to repair damage done to its standing in the Arab world and to relations with its traditional allies in Europe.

The problems showed "that the challenges of post-war stabilization may be greater than those of war itself" and that the United States was "likely to need wider international support to achieve its objectives", SIPRI said.

The invasion may also have exacerbated the problem of international terrorism by "creating a new frontline in Iraq and by fuelling Arab and Islamic resentment", it said.

European unity had suffered from transatlantic tensions concerning Iraq, the report said. There were conflicting positions within the European Union and the western military alliance NATO, which was being used by the United States "as a military toolbox for building 'coalitions of the willing' in time of need", SIPRI said.

MILITARY SPENDING: The report said world military spending leapt 11 per cent in 2003 due to a "massive increase" from the "war on terror" but the pace may slow down as Washington's pre-emptive strike policy comes under pressure.