(Reuters) - An alliance of Iraq's Shi'ite political blocs picked Prime Minister Nuri al-Maliki on Friday to head the next government, a step toward ending a political stalemate that left Iraq without a new government for more than six months.
Despite the nomination, Maliki will face an uphill struggle to convince others to work with him to form the next government. Maliki's State of Law bloc, which won 89 seats, has merged with the Iran-friendly Iraqi National Alliance, with 70 seats, to form a single bloc in parliament that would be just four seats short of the 163 needed for a governing majority.
Here are some possible implications and outcomes of Maliki's nomination:
WHAT DO THE RESULTS MEAN?
*Agreeing on a single nominee is seen by analysts as a step forward to end a stalemate that left Iraq with no new government after an inconclusive March election in March. "Both inside Iraq and among interested foreign powers, such as the U.S., Iran and even Turkey, there will be a desire to see government formation move ahead," said David Bender, a Middle East analyst from Eurasia Group.
*But this is not a guarantee that Maliki will win a second term and it does not mean it will be easy for him to build up enough support to form Iraq's new government, analysts say. "I don't expect, under current circumstances, that a government will be in place before the end of the year," said Joost Hiltermann of the International Crisis Group. "Even if agreement can be found soon on the prime minister, this still leaves other key portfolios to be filled, and then the new leaders would still have to discuss the ruling coalition's governing programme."
*Some factions from the Shi'ite alliance stayed away from Friday's meeting, politicians said, signaling a rising opposition to Maliki from within. * Disagreements on whether or not to support Maliki raised speculation of a possible rupture of the National Alliance bloc, even after Friday's nomination. WHAT'S NEXT? * Maliki will need to start talks with other political parties, mainly the cross-sectarian Iraqiya coalition and the Kurdish alliance, to form the next government.
*Politicians will have to agree next on who would take the remaining top posts such as presidency and parliament speaker, as well as the so-called sovereign ministries -- interior, defense, foreign affairs, oil and finance. The support of the Kurdish alliance, with around 56 seats, would give any party the muscle needed to form Iraq's next government.
*"The Kurds would probably be willing to come to an agreement to form part of any government as long as most of their priorities are guaranteed to be fulfilled and they retain some significant posts," said Gala Riani, Middle East Analyst at IHS Global Insight.
*Iraqiya, a cross-sectarian alliance led by former prime minister Iyad Allawi, which won the most seats in the 325-seat parliament with strong support from minority Sunnis, has said it would not join any government headed by Maliki.
*Analysts said it is difficult to see Iraqiya joining Maliki's government unless it is provided with significant concessions. Sunnis who voted in force for Iraqiya may feel robbed of the election results if they are not given a greater say in the government.
*But Maliki can still try to sway some elements from Iraqiya to join him, which could lead to a rupture of Allawi's coalition, analysts say. "If confronted by a near-triumphant Maliki some within Iraqiya might opt to make deals with the new government," said Wayne White, adjunct scholar from the Middle East Institute.
*Government formation talks could still mean weeks or months of political horse-trading that may threaten Iraq's security if the wrangling leads to a prolonged political vacuum. WHAT'S AT STAKE?
*If one of Iraq's communities was excluded from government or denied what it views as a fair share of power, a rise in violence could result. Sectarian bloodshed between Iraq's majority Shi'ite and minority Sunnis almost ripped Iraq apart in 2006-07.
*Analysts say excluding Iraqiya, and its leader Allawi, would provoke Sunni countries such as Saudi Arabia and other Gulf States, which have in the past signaled their opposition to Maliki's rule.
*Analysts see a long tussle over a government as an invitation for trouble when Iraq is fighting a stubborn insurgency while U.S. troops prepare to withdraw by the end of 2011.
*Iraq signed a series of deals with international oil companies to unlock its vast oil wealth in a bid to boost its output capacity to 12 million barrels per day from 2.5 million bpd now. The deals could catapult Iraq into the top league of oil producers, rivaling Saudi Arabia.
*Analysts say the oil deals, which would generate revenue desperately needed by Iraq to rebuild its battered economy, are likely to survive any big change in the next government as few doubt the benefits of such contracts.
*Clues on the makeup of the next government are being watched closely by the oil companies.