A vehicle with diplomatic license plates is towed from a street in Baghdad, at the site where witnesses said Egypt's Ihab al-Sherif was kidnapped

In another blow to Iraqi efforts to restore international confidence in the struggling country, gunmen in Iraq have kidnapped an Egyptian diplomat, widely expected to be the country's first Arab ambassador since the Iraqi interim government was formed in April. 

Police and eyewitnesses say the 51-year-old envoy, Ihab al-Sherif, was abducted while buying a newspaper late Saturday at a store in western Baghdad. Eight armed men reportedly surrounded the envoy, accused him of being an American spy, shoved him into the trunk of a car and sped off.

Recent media reports say Mr. Sherif, who heads Egypt's mission in Baghdad, had been tapped to become the first full-ranking Arab ambassador to Iraq's interim government. It is not clear if the envoy had been given the title prior to his kidnapping.

Egypt is the most populous and one of the most powerful Arab states in the region. By posting such a senior diplomat to Iraq, Egypt would have clearly enhanced the standing of the interim government, which many Arabs view with suspicion, because it is dominated by Shi'ite Muslims and Kurds.

Mr. Sherif, who arrived here a month ago, is the second Egyptian diplomat to be kidnapped in Baghdad since the fall of Saddam Hussein's regime in 2003. In June of last year, Islamic militants seized Egypt's third-ranking diplomat, in a bid to deter Egypt from deploying troops to Iraq. The militants released the envoy a month later, after Egypt promised that it would not send soldiers.

More than 200 foreigners and thousands of Iraqis have been kidnapped in the wave of violence that followed the ouster of Saddam. Some victims have been taken by criminal gangs for ransom. Others have been abducted by insurgents, who have made political demands.

The Iraqi government of Prime Minister Ibrahim al-Jaafari is under enormous pressure to bring disaffected Sunni Arabs, who form the core of the insurgency, into the political process, and help quell the violence. In the latest effort, the Iraqi government says it is reaching out to what it terms armed resistors.

Through an interpreter, a spokesman for Prime Minister Jaafari, Laith Kubba, told reporters the government rejects negotiating with Iraqi insurgents who have killed fellow Iraqis, but it is not opposed to talking to those who have targeted foreign troops, including U.S. forces.

"According to the international law, these forces have entered Iraq, without any legal permission," he says through an interpreter. "The political process is currently aimed at involving the groups that were resisting and targeting the foreign troops in Iraq before the elections, and we have made contact with some of these armed groups."

Before elections in January, the previous interim government of Iyad Allawi made attempts to reach out to insurgents, but failed. At the time, Iraqi officials complained that the United States tried to block talks with insurgents implicated in the killing of American troops.

The U.S. Embassy in Baghdad had no immediate comment about Mr. Kubba's statement.

A U.S. official told reporters Friday that, since January the embassy has been approached numerous times by intermediaries claiming to represent armed insurgent groups.

Secretary of Defense Donald Rumsfeld last month said that U.S. military officials were in talks with some of those intermediaries. But the embassy official, who spoke on the condition of anonymity, denied that anyone at the mission has held talks with them.