Iran and Egypt have decided to resume full diplomatic ties, Iranian Vice President Mohammad Ali Abtahi told The Associated Press yesterday.

　　His comment came hours after Tehran City Council renamed a street that was previously called after the assassin of Egyptian President Anwar Sadat, paving the way for a restoration of relations between Egypt and Iran, which cut ties in 1979.

　　"Iran and Egypt have decided to fully resume diplomatic ties. An official announcement to that effect is expected in the next few days," Abtahi said.

　　He said the decision to work toward full normalization was made during a historic meeting between Egyptian President Hosni Mubarak and Iranian President Mohammad Khatami in Geneva last month, the first between the heads of state since the 1979 Islamic revolution.

　　"It's a historic achievement serving the interests of both Tehran and Cairo and the Palestinian cause and interests of Muslim nations in the Middle East," Abtahi said.

　　Egyptian Foreign Minister Ahmed Maher indicated to reporters yesterday that Abtahi's statement was a little premature.

　　"You tell me there is a statement from Iran," he said, referring to news reports of a resumption of full relations. "I've seen it. It is a statement in the future. When the future becomes the present, you will hear from me."

　　Earlier yesterday, the Tehran City Council renamed Khaled Islambouli Street. Islambouli was the Egyptian army lieutenant who shot Sadat at a military parade in 1981. The street's new name is Intefadeh - after the Palestinian uprising against Israeli forces, the Islamic Republic News Agency reported.

　　"The new name was approved by a majority of votes," IRNA quoted Foreign Ministry spokesman Hamid Reza Asefi as saying. Asefi attended the council's meeting.

　　Iran and Egypt, two Mideast heavyweights, broke diplomatic relations in 1979 after Tehran condemned Egypt's Sadat for signing the Camp David peace treaty with Israel. In the late 1980s, they resumed contact but at a low level. They now have interest sections, not embassies, in each other's capitals.

　　Asefi said the atmosphere between Iran and Egypt had "totally changed."

　　"Iran broke ties with Egypt in support of the Palestinian nation, but now all Palestinian groups would consider Iranian-Egyptian ties as support for them. Palestinians have called for a restoration of Tehran-Cairo ties," Asefi told the Tehran City Council's meeting.