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imageBAGHDAD: Iraqis and foreign powers voiced relief on Friday after Prime Minister Nuri al-Maliki agreed to step down, as the UN targeted Islamist militants and the EU backed the arming of their Kurdish rivals.

As aid groups tried to cope with the hundreds of thousands of people displaced by Islamist advances in northern Iraq, ingredients of a fight-back began falling into place.

In New York, the UN Security Council unanimously adopted a resolution aimed at weakening Islamists in Iraq and Syria by cutting off funding and the flow of foreign fighters.

And EU ministers agreed at an emergency meeting in Brussels to back the arming of Iraqi Kurdish fighters.

The ministers said they welcomed "the decision by individual member states to respond positively to the call by the Kurdish regional authorities to provide urgently military material".

On Maliki's decision to step down, US National Security Adviser Susan Rice said it was "another major step forward" in uniting Iraq.

UN chief Ban Ki-moon also welcomed the move and called for the swift formation of "an inclusive, broad-based government ready to immediately tackle these pressing issues".

Support for Maliki's designated replacement, Haidar al-Abadi, has poured in from sources as diverse as Iran and Saudi Arabia.

When militants forces launched a major offensive on June 9, Kurdish peshmerga forces initially fared better than retreating federal soldiers, but the abandoned US-made weaponry government troops left in their wake turned IS into a formidable foe.

Militants advanced within miles of autonomous Iraqi Kurdistan last week, which was one of the factors that triggered US air strikes and broad foreign support for the cash-strapped Kurds.

When the militants, who have controlled parts of Syria for months, swept across the Sunni heartland of Iraq in early June, they encountered little or no resistance.

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