Nuclear talks between the major powers and Iran that are to be held in Baghdad on Wednesday have major implications for global security but also mark the latest step in Iraq's emergence from isolation.

For years, an international pariah and then racked by horrific bloodshed in the aftermath of the US-led invasion of 2003 that left tens of thousands dead, Iraqi authorities have earmarked more than $1 billion as part of wide-ranging efforts to boost the country's profile, with mixed results.

"We are keen that Iraq takes on a role as a constructive, positive country that has a new character, different from the character established by Saddam Hussein, which was about looking for power," said Ali Mussawi, spokesman for Iraqi Prime Minister Nuri al-Maliki.

"This meeting is an opportunity to showcase Iraq's real face, as a country looking for stability and development. At the same time, I want to say that Iraq is not a marginal country -- it is an important country, and it has a positive role."

The talks, set for May 23, will see Germany join the veto-wielding permanent members of the UN Security Council -- Britain, China, France, Russia and the United States -- look to head off a dangerously escalating standoff over Iran's nuclear programme.

Those talks are the latest example of Iraq pushing to host a variety of events to present itself to the world as a relatively stable country that is no longer rife with violence, but its attempts to do so have so far yielded uneven results.

While attacks remain common in Iraq, violence is sharply down from its peak in 2006 and 2007.

It did host a landmark Arab summit in March, the first such gathering to be held in Baghdad since now-executed dictator Saddam's 1990 invasion of Kuwait, but much of the city was shut down and Iraqis complained of rising costs and little benefit to them from the refurbishment of upscale hotels and summit venues.

Plans for the Shiite holy city of Najaf to be the Islamic Capital of Culture this year, meanwhile, were cancelled amid rampant delays and allegations of misallocated funds.

Combined, the two events were allocated around $1 billion, with additional money earmarked for Baghdad to be Arab Capital of Culture next year.

Proposals for the southern port city of Basra to host the 2013 football Gulf Cup have also been shelved, as participating nations did not accept Iraq's guarantees of safety.

Even for the Iran talks on Wednesday, initial concerns were raised by participating countries over Iraq hosting the event, both due to the violence of recent years and because of Baghdad's close relationship with Tehran, whose nuclear programme is the focus of the talks.

"It was people who hadn't been to Baghdad, who thought: 'We're going to a war zone'," said a Western diplomat in Baghdad, speaking on condition of anonymity.

"It was just an initial reaction."

The diplomat added, of the concerns over Iran's influence on Iraq: "There was a tiny bit of that, but I think again, that's just from a sort of fairly loose reading of regional politics.

"The Iraqis are not mediating, they've been very clear they're not mediating. Every time, the first thing they say is: 'We understand we're not here as mediators', just as the Turks weren't mediators in Istanbul," the diplomat said, referring to the last round of nuclear talks in April.

The Baghdad talks are not expected to produce spectacular results, so much of the focus will be on the fact that the Iraqi capital managed to host them at all.

"The sheer ability of Iraq to hold a major international event of this category highlights its re-emergence on both regional and international levels," said Reidar Visser, an Iraq analyst and editor of the Iraq-focused www.historiae.org website.

"This follows the Arab League summit in March and comes at a time when the Iraqi capacity for increasing its oil (output) is receiving worldwide attention."

Iran nuclear crisis timeline
Baghdad (AFP) May 22, 2012 - Key developments in the long-running conflict over Iran's nuclear programme:

- 2000: Along with major Western countries, Israel says it suspects Iran of using a civilian nuclear programme to secretly develop atomic weapons. Israel itself is widely believed to possess such weapons.

- January 2002: US president George W. Bush describes Iran, along with Iraq and North Korea, as making up an "axis of evil."

- 2003: A US-backed alliance invades Iraq and overthrows the regime of Saddam Hussein. This leaves Iran, which has a long border with Iraq, as the largest country in the region still hostile to US policy.

- November 2004: Iran, which is a signatory of the Nuclear Non-Proliferation Treaty, agrees to suspend its programme to enrich nuclear fuel. The United Nations International Atomic Energy Agency (IAEA) accepts Iran's stance.

- June 2005: Mahmoud Ahmadinejad, seen in the West as a hardliner, is elected president. Two months later, Iran resumes its uranium conversion activities, insisting that it only seeks to generate energy.

- December 2006: The UN Security Council imposes sanctions on Iran's trade in sensitive nuclear materials and technology. It strengthens the measures in 2007 and 2008.

- April 2007: Ahmadinejad says his country can produce nuclear fuel on an industrial scale.

- April 2009: Iran inaugurates its first nuclear fuel plant at Natanz, and says it has installed there 7,000 centrifuges, devices needed to enrich uranium.

- September 2009: Iran reveals a previously-unknown uranium enrichment plant, Fordo, being built inside a mountain near Qom.

- June-July 2010: World powers impose new military and financial sanctions.

- August 2010: Iran starts loading fuel into its first nuclear power plant, built by Russia.

- January 2011: New talks between Iran and six world powers fail.

- August 2011: Iran says it has begun transferring centrifuges from Natanz to Fordo.

- November 8, 2011: The IAEA publishes a report citing "overall, credible" evidence that until the end of 2003, and possibly since, Iran had "activities... relevant to the development of a nuclear explosive device."

- December 31, 2011: US President Barack Obama signs into law tough new sanctions.

- January 9, 2012: The IAEA confirms that Iran has started enriching uranium at Fordo to purities of 20 percent, a major technological step that takes it significantly closer to being able to enrich to weapons-grade.

- January 11: An Iranian nuclear scientist is killed by a car bomb in Tehran, the fourth in two years.

- February 15: Ahmadinejad unveils what is said to be Iran's first domestically produced, 20-percent enriched fuel for a research reactor.

- February 22: The chief UN nuclear inspector returns from Iran, saying his team was not given access to a military site where Tehran is alleged to have carried out tests aimed at developing nuclear warheads.

- April 14: In Istanbul, world powers and Iran hold their first substantive talks in 15 months, and agree to meet again in May.

- May 14: Talks with the IAEA resume in Vienna after a three-month break.

- May 21: The IAEA director general Yukiya Amano meets with Iran's chief nuclear negotiator Saeed Jalili in Tehran.

- May 23: A new meeting is scheduled between Iran and world powers in Baghdad.