Finalizing the unity government clears one hurdle for the war-torn country but it still faces challenges of establishing security and restoring basic services, tasks that experts say must happen quickly to gain the confidence of Iraqis and avoid a civil war.
Prime Minister Nouri al-Maliki, a Shiite from the Dawa Party, holds the government's most important political role. Jalal Talabani, a Kurd who served as the country's interim president, kept his largely ceremonial spot as president.
The last step to completing the government came on June 8, the same day a U.S. air strike killed al-Qaida in Iraq leader Abu Musab al-Zarqawi, when al-Maliki filled the remaining three cabinet posts for defense, interior and national security.
Parliament had approved 36 of al-Maliki's cabinet nominations on May 20 but left the three key positions vacant to allow time for further negotiations. Members of cabinet are responsible for dispensing the benefits, resources and wealth of the country.
Al-Maliki had to ensure that his nominations for the posts would act without sectarian agendas in order to gain the two-thirds majority in parliament required for approval. The ministries are in charge of the Iraqi army and police forces and of devising a plan to maintain security. Previous ministers in the interim government were accused of supporting Shiite death squads responsible for killing Sunnis.
The day parliament approved the complete government, five bombs exploded in Baghdad killing 40 people and wounding dozens, highlighting the need for better security in the capitol.
Finalizing a cabinet with ministers from Iraq's various religious and sectarian parties required significant compromises and at times deadlocks in negotiations threatened to bring down the process.
U.S. Ambassador to Iraq Zalmay Khalilzad, who has played a major role in bringing opposing parties to the table, said the outcome of Iraq's democracy depends on the willingness of its politicians.
"It is time for the leaders of various communities that are now inside the government to take responsibility and to encourage their leaders and their various groups to stop sectarian violence and to come together," Khalilzad said in a June 9 NewsHour report.
Many politicians, including the prime minister, are making efforts to cross sectarian lines, said David Mack, the vice president of the Middle East Institute, but that building a government that bridges these sectarian differences will be an "uphill struggle."
"The odds tend to be pretty heavy against it [a non-sectarian government]. At a time of great turmoil and lack of stability, people tend to retreat to their more tribal and sectarian identities looking for protection," said Mack.
In an article on the Washington Post's editorial page, al-Maliki expressed confidence in his new government saying the "Iraqis have elected a national unity government that will always put national interests ahead of sectarian or ethnic agendas" but acknowledged the future challenges saying the "scale of the task ahead is humbling."
Rifts within the Shiite and Sunni coalitions over a unified position makes predicting emerging political blocs difficult and adds to the challenges confronting Iraqi leaders.
The government is appointed to a four-year term but it must quickly prove its legitimacy to the Iraqi people by providing safety and social services at a time of continuing sectarian violence, power outages and unemployment.
"The Iraqis are not asking for much: water, power 24/7, a sense of security, safe streets," said Judith Yaphe, a senior research fellow at the National Defense University.
The Iraq Index, a survey of economic, public opinion and security data compiled by the Brooking Institution shows pre-war electricity levels at 16-24 hours a day in Baghdad. In April 2006, Iraqis averaged 4.5 hours and in May, 3.9 hours.
Al-Maliki has made restoring security and cracking down on militias the first priorities. On June 13, he unveiled a security plan for Baghdad that will dispatch as many as 75,000 Iraqi soldiers and police officers to monitor the city and installs new checkpoints. Al-Maliki also is working on a plan to deal with militias with the possibility of integrating them into the Iraqi security forces.
Handling militias and creating an effective security force fall under the responsibility of the defense, interior and national security ministries. The key, according to Yaphe, is to make sure that if militias are brought into a national force, they will not maintain their loyalty to warlords but build loyalty to the state in order to protect all Iraqi citizens.
"A lot of it is going to depend on how good these ministers are at being both transparent and effective," said Yaphe. "You can't just send the militia all home. You need to incorporate them."
Another item on the government's agenda is rebuilding Iraq's oil infrastructure and restoring output to pre-war levels and protect the pipelines against insurgent attacks.
President Bush made a surprise visit on June 13 to Baghdad to meet with Iraqi leaders and show his support for the new government. At a press conference at the White House the day after his visit, he acknowledged the challenges ahead in Iraq but said American efforts are worth the sacrifice.
"By helping these new governments succeed, we'll be closer to completing our mission. And the mission is to develop a country that can govern itself, sustain itself, and defend itself, and a country that is an ally in the war on terror."
The foundation of Iraq's government rests on the Constitution ratified in October 2005. In December, Iraqi voters elected the 275-member parliament largely along sectarian lines. The United Iraqi Alliance, a Shiite coalition made up of three main groups, the Dawa Party, the Supreme Council for Islamic Revolution in Iraq and supporters of cleric Muqtada al-Sadr, emerged the strongest with 128 seats.
The Kurdish coalition, led by Talabani, holds 53 seats, and the Iraq Accordance Front, a religious Sunni Arab coalition, won 44 seats. In total, the parliament includes 12 political blocs.
It has a four-month period to review and make amendments to the constitution, a stipulation demanded by Sunnis before they participated in December's elections. As written, the constitutional framework created a weak central government that gives provinces authority over the federal government.