Iraqi and US-led forces are reported to have raided parts of an Iraqi town near Baghdad searching for Shi'ite hostages threatened with death by Sunni rebels.

Shi'ite officials say the rebels who entered the town of Medaen last night are holding up to 150 hostages.

They are threatening to kill the hostages unless Shi'ites leave the town.

Meanwhile, the Iraqi Foreign Minister, Hoshyar al-Zebari, has warned Iraq's neighbours that they must do a better job to prevent insurgents from slipping across their borders.

He was speaking ahead of a two-day meeting in Istanbul with foreign ministers from Iran, Jordan, Kuwait, Saudi Arabia, Syria and Turkey.

He listed controls on money transfers and media incitement as
other areas of concern.