WASHINGTON, July 15: The White House scolded the Philippines on Thursday for deciding to pull its forces from Iraq ahead of schedule to save the life of a Filipino hostage, saying the move sent "the wrong signal" to terrorists.

"It's disappointing to see a decision that sends the wrong signal to terrorists," spokesman Scott McClellan told reporters. "You cannot negotiate with terrorists or make a separate peace with terrorists. And we understand that they have made the decision to withdraw their 51 troops ahead of schedule," McClellan added.

Foreign Secretary Delia Albert announced in Manila on Wednesday that the troop pullout had begun, suggesting that eight members of the 51-member contingent had already left the war-torn country.

Following the decision, hostage Angelo de la Cruz, abducted last week by a group calling itself the Islamic Army in Iraq - Khalid Ibn al-Walid Brigade, was declared "alive and safe" by a Filipino diplomat in Baghdad.

The kidnappers had demanded that Manila advance the pullout of its contingent by a month to July 20 and threatened to execute the father of eight if President Gloria Arroyo failed to heed their call.

Despite the Philippines' withdrawal, McClellan said that part of US President George W. Bush's "plan for success in Iraq was broadening international support. And we are making great progress in that respect."

McClellan pointed to the unanimously approved UN Security Council resolution that endorsed Iraq's interim government, as well as Nato's commitment to help train Iraqi security forces.

SADDAM'S EXECUTION SUPPORTED: Thousands of Iraqis marched through central Baghdad on Thursday demanding the execution of former president Saddam Hussein and denouncing militant Abu Musab al Zarqawi.

Noisy protesters waved Iraqi flags, chanted anti-Saddam slogans and held up posters depicting mass graves. "Let every fool listen, Saddam has to be executed", "No, No to Tikrit" shouted the crowd in reference to Saddam's hometown north of Baghdad.

Protesters also shouted slogans denouncing the United States, Zionism and terrorism. "Death to Wahabis! Death to Zarqawi!" shouted several hundred people in the heart of Baghdad's commercial district.

Zarqawi, the US military's number one target in Iraq with a 25 million dollars bounty on his head, is suspected of being behind many of the most deadly suicide attacks that have devastated Iraq in the 15 months since Saddam Hussein's overthrow.

ANTI-TERROR UNIT: Iraq's Prime Minister Iyad Allawi unveiled a new intelligence unit on Thursday to help restore security and announced a Middle East tour to open a "new chapter" in relations with neighbouring countries.

Speaking a day after a suicide car bomb tore through the walls outside the government's main compound in Baghdad killing 10 people and wounding 40, Mr Allawi said he was determined to win the fight against an insurgency that bred during the US-led occupation. "Those people who label terrorists as resistance fighters are misleading themselves," he said. -AFP/Reuters

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