posted 03-17-2004 11:00 AM            

By Daniel Flynn

MADRID (Reuters) - Spain's incoming prime minister Jose Luis Rodriguez Zapatero Wednesday rebuffed an appeal from President Bush to stand by the U.S.-led occupation of Iraq, which he described as a "fiasco."

"I will listen to Mr Bush but my position is very clear and very firm," Zapatero told Onda Cero radio. "The occupation is a fiasco. There have been almost more deaths after the war than during the war."

Zapatero, who is due to take office next month after an unexpected election win Sunday, has pledged to withdraw some 1,300 Spanish troops from Iraq by July 1 if the United Nations does not take charge there.

Tuesday, Bush called on Spain and other allies in Iraq not to yield to pressure from al Qaeda by pulling their troops from the coalition occupying the turbulent country.

"My position is the same. I have explained it throughout the election campaign," he said. "The occupying forces have not allowed the United Nations to take control of the situation."

The Socialist leader unexpectedly won Sunday's election amid outcry over a suspected al Qaeda bombing which killed 201 people. The attack revived public opposition to Spain's presence in Iraq.

The White House said it may seek a new U.N. resolution before it hands back sovereignty to Iraqis by the end of June to persuade allies such as Spain not to withdraw.

It has cautioned Spain and other allies not to send the message that "terrorists" can influence their policies.

ABOUT TURN FOR SPAIN

Zapatero's swift pledge after Sunday's election to pull troops from Iraq if conditions did not change was an about-turn from outgoing Prime Minister Jose Maria Aznar's unflinching support for Bush's foreign policy.

But Zapatero insisted his stance on Iraq was not a reaction to the rush-hour train attacks, but rather a point of principle.

"Fighting terrorism with bombs, with operations of 'shock and awe', with missiles, that does not combat terrorism it only generates more radicalism," the 43-year-old Socialist leader said.

"The way to fight terrorism is with the rule of law, with international legislation, with intelligence services," he said. "This is what the international community should be talking about."

Zapatero swept to power amid public anger at the government's handling of Thursday's bombing, which it continued to blame on armed Basque separatists ETA despite mounting evidence of the involvement of Islamic militants.

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Tuesday, Bush called on Spain and other allies in Iraq not to yield to pressure from al Qaeda by pulling their troops from the coalition occupying the turbulent country."