German Foreign Minister Joschka Fischer said on Tuesday the draft offers a good basis to start from but "needs more work".
The document, sent for early negotiations on Monday, endorses a "sovereign Iraq" under an interim government being assembled by UN envoy al-Akhdar al-Ibrahimi.
It would formalise an end to the US-led occupation of Iraq more than a year after the US-led war that toppled Saddam Hussein.
"Naturally we must wait for al-Akhdar al-Ibrahimi's report or propositions before the resolution can be finalised, but I think there is a very good basis on which to try to find a consensus, and we could obtain it," Fischer said.
"We are working very closely on this basis with our European and American partners, and others in the Security Council."
Fischer added it was important the calendar for returning sovereignty to the Iraqi people on 30 June be respected.
"It is a proposal which must be discussed and improved on a certain number of points touching principally the sincerity, the reality and the credibility of the process of sovereignty transfer"
French Foreign Minister
The draft sets no date for the more than 100,000 British and US troops to leave Iraq, and provides them wide-ranging powers to maintain order and fight "terrorism".
In Paris, the presidential office said French President Jacques Chirac had told US President George Bush that the proposed UN resolution was a good "basis for discussion" but needed further work.
Earlier on Tuesday, French Foreign Minister Michel Barnier said the UN draft must be improved if it were to ensure a credible handover of sovereignty to the Iraqi people.
"It is a proposal which must be discussed and improved on a certain number of points touching principally the sincerity, the reality and the credibility of the process of sovereignty transfer," the minister said.
France and Germany, which both fiercely opposed the war, last year helped prevent a UN resolution that would have legitimised the invasion.
Meanwhile, Russia, another anti-war country, has said it will only discuss a new UN resolution on Iraq after a new "legitimate" temporary government has been formed in the country.
Sergei Ivanov (L) has refused to
discuss a new UN Iraq resolution
Foreign Minister Sergei Lavrov told Russia's parliament on Tuesday that the mission of the UN special envoy to Iraq offers the opportunity to "discover if there is agreement in Iraqi society, to what extent the (new) government is seen as legitimate in Iraqi society and in the eyes of Iraq's neighbors, which is also important".
"Only after receiving this information will we be able to study the question of recognising this government," he said.