Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts

Tsunami kills at least five in Solomons after big Pacific quake


(Reuters) - A powerful 8.0 magnitude earthquake set off a tsunami that killed at least five people in a remote part of the Solomon Islands on Wednesday and triggered evacuations across the South Pacific as island nations issued tsunami alerts.


The quake struck 340 km (211 miles) east of Kira Kira in the Solomons, the Pacific Tsunami Warning Center in Hawaii said as it issued warnings for the Solomons and other South Pacific nations including Australia and New Zealand. It later canceled the warnings for the outlying regions.


A tsunami measuring 0.9 metres (three feet) hit near the town of Lata on the remote Santa Cruz island, swamping some villages and the town's main airport as people fled to safety on higher ground.


More than three dozen aftershocks up to magnitude 6.6 rocked the region in the hours after the quake, the U.S. Geological Survey said.


Lata hospital's director of nursing, Augustine Pilve, told New Zealand television that five people had been killed, including a boy about 10 years old, adding that more casualties were possible as officials made their way to at least three villages that may have been hit.


"It's more likely that other villages along the coast of Santa Cruz may be affected," he said.


Disaster officials in the Solomon Islands capital Honiara told the Solomon Islands Broadcasting Corp. that they believed six people were dead and that five villages had suffered damage.


Solomon Islands Police Commissioner John Lansley said it was too early to fully assess the damage or casualty numbers, and said authorities hoped to send aircraft to the region on Thursday to help determine the extent of the damage.


Luke Taula, a fisheries officer in Lata, said he watched the tsunami as it came in small tidal surges rather than as one large wave.


"We have small waves come in, then go out again, then come back in. The waves have reached the airport terminal," he told Reuters by telephone.


The worst damage was to villages on the western side of a point that protects the main township, he said.


"There are reports that some communities have been badly hit, their houses have been damaged by the waves."


About 5,000 people lived in and around the town, but the area was deserted as people fled to higher ground, Taula said.


HOT SPOT


The Solomons, perched on the geologically active "Pacific Ring of Fire", were hit by a devastating tsunami following an 8.1 magnitude quake in 2007. At least 50 people were killed then and dozens left missing and more than 13 villages destroyed.


"It's an area that is very prone to earthquakes," said Jonathan Bathgate, seismologist at Geoscience Australia. "We've had seven 6-plus magnitude earthquakes in this region since January 31, so it has been very active in the past week."


Initial signs were that the tremor was a thrust quake, in which vertical movement in the continental plates generates higher risk of tsunami, Bathgate added.


Authorities in the Solomons, Fiji, Guam and elsewhere had urged residents to higher ground before the Pacific Tsunami Warning Center canceled its alerts.


"The earthquake would have to be quite a bit bigger to make a much more sizeable tsunami," said Brian Shiro, geophysicist for the center in Hawaii.


(Reporting by James Grubel in CANBERRA,; Additional reporting by Michael Perry and Lincoln Feast in SYDNEY and Alex Dobuzinskis in LOS ANGELES)



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Iran's Ahmadinejad in Egypt on historic visit


CAIRO (Reuters) - President Mahmoud Ahmadinejad arrived in Egypt on Tuesday on the first trip by an Iranian head of state since the 1979 revolution, underlining the thaw in relations since Egyptians elected an Islamist head of state.


President Mohamed Mursi, the Muslim Brotherhood politician elected in June, kissed Ahmadinejad as he disembarked from his plane at Cairo airport. The leaders walked down a red carpet, Ahmadinejad smiling as he shook hands with waiting dignitaries.


Visiting Cairo to attend an Islamic summit that begins on Wednesday, the president of the Shi'ite Islamist republic is due to meet later on Tuesday with the grand sheikh of al-Azhar, one of the oldest seats of learning in the Sunni world.


Such a visit would have been unthinkable during the rule of Hosni Mubarak, the military-backed autocrat who preserved Egypt's peace treaty with Israel during his 30 years in power and deepened ties between Cairo and the West.


"The political geography of the region will change if Iran and Egypt take a unified position on the Palestinian question," Ahmadinejad said in an interview with Al Mayadeen, a Beirut-based TV station, on the eve of his visit.


He said he wanted to visit the Gaza Strip, the Palestinian territory which neighbors Egypt to the east and is run by the Islamist movement Hamas. "If they allow it, I would go to Gaza to visit the people," Ahmadinejad said.


Analysts doubt that the historic changes that brought Mursi to power in Egypt will result in a full restoration of diplomatic ties between states whose relations were broken off in 1980 - a year after the Iranian revolution and the conclusion of Egypt's peace treaty with Israel.


OBSTACLES TO FULL TIES


Egypt is concerned by Iran's support for Syrian President Bashar al-Assad, who is trying to crush an uprising inspired by the revolt that swept Mubarak from power two years ago. Egypt's overwhelmingly Sunni Muslim population is broadly supportive of the uprising against Assad's Alawite-led administration.


The Mursi administration also wants to safeguard relations with Gulf Arab states that are supporting Cairo's battered state finances and are deeply suspicious of Iran. Mursi wants to preserve ties with the United States, the source of $1.3 billion in aid each year to the influential Egyptian military.


Mursi's government has established close ties with Hamas, a movement backed by Iran and shunned by the West because of its hostility to Israel, but its priority is addressing Egypt's deep economic problems.


"The restoration of full relations with Iran in this period is difficult, despite the warmth in ties ... because of many problems including the Syrian crisis and Cairo's links with the Gulf states, Israel and the United States," said one former Egyptian diplomat.


Ahmadinejad's visit to Egypt follows Mursi's visit to Iran in August for a summit of the Non-Aligned Movement.


Sheikh Ahmed al-Tayeb, head of the 1,000-year-old al-Azhar mosque and university, will meet Ahmadinejad at his offices in mediaeval Islamic Cairo, al-Azhar's media office said.


Iranian Foreign Minister Ali Akbar Salehi stressed the importance of Muslim unity when he met Sheikh al-Tayeb at al-Azhar last month.


Egypt and Iran have taken opposite courses since the late 1970s. Egypt, under Mubarak's predecessor Anwar Sadat, concluded a peace treaty with Israel in 1979 and became a close ally of the United States and Europe. Iran from 1979 turned into a center of opposition to Western influence in the Middle East.


Symbolically, Iran named a street in Tehran after the Islamist who led the 1981 assassination of Sadat.


Egypt gave asylum and a state funeral to Iran's exiled Shah Reza Pahlavi, who was overthrown by the 1979 Iranian revolution. He is buried in a medieval Cairo mosque alongside his ex-brother-in-law, Egypt's last king, Farouk.


(Additional reporting by Ayman Samir; Editing by Andrew Roche)



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Syrian opposition chief under fire for talks with Assad allies


MUNICH (Reuters) - Syria's opposition leader flew back to his Cairo headquarters from Germany on Sunday to explain to skeptical allies his decision to talk with President Bashar al-Assad's main backers Russia and Iran.


The Russian and Iranian foreign ministers, and U.S. Vice-President Joe Biden, portrayed Syrian National Coalition leader Moaz Alkhatib's new willingness to talk with the Assad regime as a major step towards resolving the two-year-old war.


"If we want to stop the bloodshed we cannot continue putting the blame on one side or the other," Iran's Ali Akbar Salehi said on Sunday, welcoming Alkhatib's overtures and adding that he was ready to keep talking to the opposition. Iran is Assad's main military backer together with Russia.


"This is a very important step. Especially because the coalition was created on the basis of categorical rejection of any talks with the regime," Lavrov was quoted as saying on Sunday by Russia's Itar Tass news agency.


Russia has blocked three U.N. Security Council resolutions aimed at pushing Assad out or pressuring him to end a civil war in which more than 60,000 people have died. But Moscow has also tried to distance itself from Assad by saying it is not trying to prop him up and will not offer him asylum.


Syrian state media said Assad received a senior Iranian official and told him Syria could withstand "threats ... and aggression" like an air attack on a military base last week, which Damascus has blamed on Israel.


"USELESS" TALKING TO IRAN


Politicians from the United States, Europe and the Middle East at the Munich Security Conference praised Alkhatib's "courage". But the moderate Islamist preacher was likely to face sharp criticism from the exiled leadership back in Cairo.


Alkhatib has put his leadership on the line by saying he would be willing to talk to representatives of the Assad regime on condition they release 150,000 prisoners and issue passports to the tens of thousands of displaced people who have fled to neighboring countries but do not have documents.


Walid al-Bunni, a member of the Coalition's 12-member politburo, described Alkhatib's meeting with Iran's foreign minister as a failure.


"It was unsuccessful. The Iranians are unprepared to do anything that could help the causes of the Syrian Revolution," Bunni, a former political prisoner, told Reuters from Budapest.


Bunni said the 70-member Coalition is preparing to convene in full in Cairo, to be briefed by Alkhatib on his latest diplomatic moves and meetings in Munich.


Alkhatib, whose family are custodians of the Umayyad Mosque in the historic center of Damascus, is seen as a bulwark against Salafist forces who are a main player in the armed opposition.


He was chosen as the head of the Coalition in Qatar last year, with crucial backing from the Muslim Brotherhood.


One of Alkhatib's colleagues on the Coalition politburo, speaking on condition of anonymity, pointed to comments by Salehi and Lavrov on Sunday, a day after their meetings with Alkhatib, as evidence that they still backed Assad.


Salehi told the Munich conference where the round of talks took place that the solution was to hold elections in Syria - making no mention of Assad having to leave the country.


FIZZLE OUT?


Firm opposition backers like Qatar's Prime Minister Hamad bin Jassim al-Thani and U.S. Republican Senator John McCain voiced frustration in Munich at the international community's reluctance to intervene in the Syrian conflict.


"We consider the U.N. Security Council directly responsible for the continuing tragedy of the Syrian people, the thousands of lives that were lost, the blood that was spilled and is still flowing at the hands of the regime's forces," said al-Thani.


Moscow played down the significance of the discussions in Munich, with one diplomatic source calling the talks between Lavrov and Alkhatib "simply routine meetings".


"We have presented our views when Minister Lavrov meet Alkhatib, we have noted his comments that there is still a chance for dialogue with Syrian government. That is something we have called for," said the Russian source.


"To what extent is that realistic, that's a different matter and there are doubts about that," said the source.


One source in Khatib's delegation said the offer of dialogue would find an echo among Syrians opposed to Assad who have not taken up arms "and want to get rid of him with the minimum bloodshed".


Fawaz Tello, a veteran Syrian opposition campaigner based in Berlin, said Alkhatib had made "a calculated political maneuver to embarrass Assad".


"But it is an incomplete initiative and it will probably fizzle out," Tello told Reuters. "The Assad regime cannot implement any item in the series of initiatives we have seen lately because it would simply fall."


Russia and Iran were already beginning to use Alkhatib's initiative negatively, he said, while "the regime and its allies will only treat Alkhatib's meetings as an additional opportunity to smash the rebellion or weaken it".


Asked about the risk of his strategy being seen as a sign of weakness in the opposition or frustration at the Free Syrian Army's gains, Alkhatib told Reuters in Munich: "The fighters have high morale and they are making daily advances."


(Additional reporting by Alexandra Hudson in Munich and Gabriela Baczynska in Moscow; Writing by Stephen Brown; Editing by Andrew Roche)



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Suicide bomber, gunmen kill 33 in Iraq's Kirkuk


KIRKUK, Iraq (Reuters) - A suicide bomber driving a car and gunmen disguised in police uniforms killed at least 33 people in the Iraqi city Kirkuk on Sunday when they tried to storm the police headquarters.


It was the third major attack in several weeks in or near the northern city, an ethnically mixed area of Arabs, Kurds and Turkmen at the heart of a dispute over oil and land between Baghdad's central government and the autonomous Kurdistan region.


"A suicide bomber driving a car packed with explosives hit the entrance of the headquarters and after the blast gunmen in explosive vests attacked with AK47s and grenades, but the guards killed them," a police official said.


The huge car bomb blast tore into the police directorate's concrete facade, destroyed cars outside, and left bodies under rubble at nearby government offices. Police said there were at least two gunmen.


Several armed groups are active in Kirkuk, and Sunni Islamist insurgents tied to al Qaeda often attack security forces in an attempt to undermine Shi'ite Prime Minister Nuri al-Maliki's government and stoke sectarian tensions.


Last month a suicide bomber disguised as a mourner killed at least 26 at a funeral at a Shi'ite mosque in the nearby city of Tuz Khurmato, and days earlier a suicide bomber driving a truck killed 25 in an attack on a political party headquarters in Kirkuk, 170 km (105 miles) north of the capital Baghdad.


(Reporting by Omar Mohammed and Mustafa Mahmoud in Kirkuk; Writing by Patrick Markey; Editing by Pravin Char)



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Thirty-one killed as militants attack Pakistan checkpoint


DERA ISMAIL KHAN, Pakistan (Reuters) - Militants attacked an isolated army checkpoint in Pakistan's restive northwest on Saturday, with at least 31 people killed in the initial assault, subsequent crossfire and a rocket attack on a house, officials said.


The Pakistan Taliban claimed responsibility, saying the attack was in response to a U.S. drone strike in neighboring North Waziristan last month in which two commanders were killed.


The Pakistani military and pro-government militias have since 2009 regained territory from the Pakistan Taliban, who once controlled land a few hours' drive from the capital of Islamabad.


The militants attacked the post at Lakki Marwat early on Saturday.


Security sources said at least 12 militants and nine officials and civilians were killed in the clash. Two bodies had suicide bomb belts on them, an official said.


"Cross-firing between militants and security officials continued for four hours," one source said.


The militants also targeted a house next to the camp with rockets, killing 10 members of one family, sources said.


"Pakistan has been co-operating with the U.S. in its drone strikes that killed our two senior commanders, Faisal Khan and Toofani, and the attack on military camp was the revenge of their killing," the Taliban spokesman said.


He said four suicide bombers attacked the camp and blew themselves up. He said more than a dozen soldiers were killed.


(Additional reporting by Jibran Ahmad in Peshawar, Javed Hussain in Parachinar and Mubasher Bukhari in Islamabad; Writing by Nick Macfie)



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Explosion at Mexican oil giant Pemex headquarters kills 25


MEXICO CITY (Reuters) - Emergency services worked into the early hours of Friday to find people trapped in rubble under state oil company Pemex's headquarters in Mexico City after an explosion that killed at least 25 people and injured more than 100.


Scenes of confusion and chaos at the downtown tower dealt yet another blow to Pemex's image as Mexico's new president courts outside investment for the 75-year-old monopoly.


Search and rescue workers picked through debris, and investigators sifted through shattered glass and concrete at the bottom of the building to try to find what caused the blast. It was not clear how many might still be trapped inside.


Pemex, a symbol of Mexican self-sufficiency as well as a byword in Mexico for security glitches, oil theft and frequent accidents, has been hamstrung by inefficiency, union corruption and a series of safety failures costing hundreds of lives.


Thursday's blast at the more than 50-storey skyscraper that houses administrative offices followed a September fire at a Pemex gas facility near the northern city of Reynosa which killed 30 people. More than 300 were killed when a Pemex natural gas plant on the outskirts of Mexico City blew up in 1984.


Eight years later, about 200 people were killed and 1,500 injured after a series of underground gas explosions in Guadalajara, Mexico's second biggest city. An official investigation found Pemex was partly to blame.


Pemex initially flagged Thursday's incident as a problem with its electricity supply and then said there had been an explosion. But it did not give a cause for the blast.


A government official, speaking on condition of anonymity, said a preliminary line of inquiry suggested a gas boiler had blown up in a Pemex building just to the side of the main tower. However, he stressed nothing had been determined for sure.


Others at the scene said gas may have caused the blast.


Not long after the blast, President Enrique Pena Nieto was at the scene, vowing to discover how it happened.


"We will work exhaustively to investigate exactly what took place, and if there are people responsible, to apply the force of the law on them," he told reporters before going to visit survivors in hospital.


Shortly after midnight, at least 46 victims were still being treated in hospital, the company said.


Pemex said the blast would not affect operations, but concern in the government was evident as top military officials, the attorney general and the energy minister joined Interior Minister Miguel Angel Osorio Chong for a late news conference.


"I have issued instructions to the relevant authorities to convene national and international experts to help in the investigations," Osorio Chong said. He later noted that the number of casualties could still climb.


Whatever caused it, the deaths and destruction will put the spotlight back on safety at Pemex, which only a couple of hours before the explosion had issued a statement on Twitter saying the company had managed to improve its record on accidents.


Nieto has said he is giving top priority to reforming the company this year, though he has yet to reveal details of the plan, which already faces opposition from the left.


Both Pena Nieto and his finance minister were this week at pains to stress the company will not be privatized.


(Editing by Louise Ireland)



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Syrian rebels make slow headway in south


AMMAN (Reuters) - The revolt against President Bashar al-Assad first flared in Deraa, but the southern border city now epitomizes the bloody stalemate gripping Syria after 22 months of violence and 60,000 dead.


Jordan next door has little sympathy with Assad, but is wary of spillover from the upheaval in its bigger neighbor. It has tightened control of its 370-km (230-mile) border with Syria, partly to stop Islamist fighters or weapons from crossing.


That makes things tough for Assad's enemies in the Hawran plain, traditionally one of Syria's most heavily militarized regions, where the army has long been deployed to defend the southern approaches to Damascus from any Israeli threat.


The mostly Sunni Muslim rebels, loosely grouped in tribal and local "brigades", are united by a hatred of Assad and range from secular-minded fighters to al Qaeda-aligned Islamists.


"Nothing comes from Jordan," complained Moaz al-Zubi, an officer in the rebel Free Syrian Army, contacted via Skype from the Jordanian capital Amman. "If every village had weapons, we would not be afraid, but the lack of them is sapping morale."


Insurgents in Syria say weapons occasionally do seep through from Jordan but that they rely more on arsenals they seize from Assad's troops and arms that reach them from distant Turkey.


This month a Syrian pro-government television channel showed footage of what it said was an intercepted shipment of anti-tank weapons in Deraa, without specifying where it had come from.


Assad's troops man dozens of checkpoints in Deraa, a Sunni city that was home to 180,000 people before the uprising there in March 2011. They have imposed a stranglehold which insurgents rarely penetrate, apart from sporadic suicide bombings by Islamist militants, say residents and dissidents.


Rebel activity is minimal west of Deraa, where military bases proliferate near the Israeli-occupied Golan Heights.


Insurgents have captured some towns and villages in a 25-km (17-mile) wedge of territory east of Deraa, but intensifying army shelling and air strikes have reduced many of these to ruin, forcing their residents to join a rapidly expanding refugee exodus to Jordan, which now hosts 320,000 Syrians.


However, despite more than a month of fighting, Assad's forces have failed to winkle rebels out of strongholds in the rugged volcanic terrain that stretches from Busra al-Harir, 37 km (23 miles) northeast of Deraa, to the outskirts of Damascus.


Further east lies Sweida, home to minority Druze who have mostly sat out the Sunni-led revolt against security forces dominated by Assad's minority, Shi'ite-rooted Alawite sect.


"KEY TO DAMASCUS"


As long as Assad's forces control southwestern Syria, with its fertile, rain-fed Hawran plain, his foes will find it hard to make a concerted assault on Damascus, the capital and seat of his power, from suburbs where they already have footholds.


"If this area is liberated, the supply routes from the south to Damascus would be cut," said Abu Hamza, a commander in the rebel Ababeel Hawran Brigade. "Deraa is the key to the capital."


Fighters in the north, where Turkey provides a rear base and at least some supply lines, have fared somewhat better than their counterparts in the south, grabbing control of swathes of territory and seizing half of Aleppo, Syria's biggest city.


They have also captured some towns in the east, across the border from Iraq's Sunni heartland of Anbar province, and in central Syria near the mostly Sunni cities of Homs and Hama.


But even where they gain ground, Assad's mostly Russian-supplied army and air force can still pound rebels from afar, prompting a Saudi prince to call for outsiders to "level the playing field" by providing anti-tank and anti-aircraft weapons.


"What is needed are sophisticated, high-level weapons that can bring down planes, can take out tanks at a distance," Prince Turki al-Faisal, a former intelligence chief and brother of the Saudi foreign minister, said last week at a meeting in Davos.


Saudi Arabia and its fellow Gulf state Qatar have long backed Assad's opponents and advocate arming them, but for now the rebels are still far outgunned by the Syrian military.


"They are not heavily armed, properly trained or equipped," said Ali Shukri, a retired Jordanian general, who argued also that rebels would need extensive training to use Western anti-tank or anti-aircraft weapons effectively even if they had them.


He said two powerful armored divisions were among Syrian forces in the south, where the rebels are "not that strong".


It is easier for insurgents elsewhere in Syria to get support via Turkey or Lebanon than in the south where the only borders are with Israel and Jordan, Shukri said.


Jordan, which has urged Assad to go, but seeks a political solution to the crisis, is unlikely to ramp up support for the rebels, even if its cautious policy risks irritating Saudi Arabia and Qatar, financial donors to the cash-strapped kingdom.


ISLAMIST STRENGTH


"I'm confident the opposition would like to be sourcing arms regularly from the Jordanian border, not least because I guess it would be easier for the Saudis to get stuff up there on the scale you'd be talking about," said a Western diplomat in Amman.


A scarcity of arms and ammunition is the main complaint of the armed opposition, a disparate array of local factions in which Islamist militants, especially the al Qaeda-endorsed Nusra Front, have come to play an increasing role in recent months.


The Nusra Front, better armed than many groups, emerged months after the anti-Assad revolt began in Deraa with peaceful protests that drew a violent response from the security forces.


It has flourished as the conflict has turned ever more bitterly sectarian, pitting majority Sunnis against Alawites.


Since October, the Front, deemed a terrorist group by the United States, has carried out at least three high-profile suicide bombings in Deraa, attacking the officers' club, the governor's residence and an army checkpoint in the city centre.


Such exploits have won prestige for the Islamist group, which has gained a reputation for military prowess, piety and respect for local communities, in contrast to some other rebel outfits tainted by looting and other unpopular behavior.


"So far no misdeeds have come from the Nusra Front to make us fear them," said Daya al-Deen al-Hawrani, a fighter from the rebel al-Omari Brigade. "Their goal and our goal is one."


Abu Ibrahim, a non-Islamist rebel commander operating near Deraa, said the Nusra Front fought better and behaved better than units active under the banner of the Free Syrian Army.


"Their influence has grown," he acknowledged, describing them as dedicated and disciplined. Nor were their fighters imposing their austere Islamic ideology on others, at least for now. "I sit with them and smoke and they don't mind," he said.


The Nusra Front may be trying to avoid the mistakes made by a kindred group, Al Qaeda in Iraq, which fought U.S. troops and the rise of Shi'ite factions empowered by the 2003 invasion.


The Iraqi group's suicide attacks on civilians, hostage beheadings and attempts to enforce a harsh version of Islamic law eventually alienated fellow Sunni tribesmen who switched sides and joined U.S. forces in combating the militants.


Despite the Nusra Front's growing prominence and its occasional spectacular suicide bombings in Deraa, there are few signs that its fighters or other rebels are on the verge of dislodging the Syrian military from its southern bastions.


Abu Hamza, the commander in the Ababeel Hawran Brigade, was among many rebels and opposition figures to lament the toughness of the task facing Assad's enemies in the south: "What is killing us is that all of Hawran is a military area," he said.


"And every village has five army compounds around it."


(Writing by Alistair Lyon; Editing by Alastair Macdonald)



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Mursi heads to Germany on trip cut back by Egypt crisis


CAIRO/BERLIN (Reuters) - Egyptian President Mohamed Mursi flew to Germany on Wednesday to convince Europe of his democratic credentials, leaving behind a country in crisis after a wave of violence that has killed more than 50 people.


The Egyptian army chief warned on Tuesday that the state was on the brink of collapse if Mursi's opponents and supporters did not end the street battles that have marked the two year anniversary of the revolt that toppled autocrat Hosni Mubarak.


Because of the crisis, Mursi has curtailed the schedule of his European visit, cancelling plans to go to Paris after Berlin. He is due to return to Cairo later on Wednesday.


Near Cairo's Tahrir Square on Wednesday morning, dozens of protesters threw stones at police who fired back with teargas, although the scuffles were short-lived.


"Our demand is simply that Mursi goes, and leaves the country alone. He is just like Mubarak and his crowd who are now in prison," said Ahmed Mustafa, 28, a youth who had goggles on his head to protect his eyes from teargas.


Opposition politician Mohamed ElBaradei called for a meeting between the president, government ministers, the ruling party and the opposition to halt the violence. But he also restated the opposition's precondition that Mursi first commit to seeking a national unity government, which Mursi has so far rejected.


Mursi's critics accuse him of betraying the spirit of the revolution by keeping too much power in his own hands and those of his Muslim Brotherhood, the Islamist movement banned under Mubarak which won repeated elections since the 2011 uprising.


Mursi's supporters say the protesters want to overthrow Egypt's first democratically elected leader. The unrest has prevented a return to stability ahead of new parliamentary elections due within months, and worsened an economic crisis that has seen the pound currency tumble in recent weeks.


The worst violence has been in the Suez Canal city of Port Said, where rage was fuelled by death sentences passed against soccer fans for deadly riots last year. Mursi responded by announcing on Sunday a month-long state of emergency and curfew in Port Said and two other Suez Canal cities.


Protesters ignored the curfew and returned to the streets on Monday although the streets grew quieter on Tuesday. Human Rights Watch called for Mursi to lift the emergency decree.


Mursi will be keen to allay the West's fears over the future of the most populous Arab country when he meets German Chancellor Angela Merkel and powerful industry groups in Berlin.


"DISTURBING IMAGES"


"We have seen worrying images in recent days, images of violence and destruction, and I appeal to both sides to engage in dialogue," German Foreign Minister Guido Westerwelle said in a radio interview on Wednesday ahead of Mursi's arrival.


Germany's "offer to help with Egypt's transformation clearly depends on it sticking to democratic reforms", he added.


Germany has praised Mursi's efforts in mediating a ceasefire between Israel and Palestinians in Gaza after a conflict last year, but became concerned at Mursi's efforts to expand his powers and fast-track a constitution with an Islamist tint.


Berlin was also alarmed by video that emerged in recent weeks showing Mursi making vitriolic remarks against Jews and Zionists in 2010 when he was a senior Brotherhood official. Germany's Nazi past and strong support of Israel make it highly sensitive to anti-Semitism.


Westerwelle called Mursi's past anti-Jewish remarks "unacceptable. But at the same time President Mursi has played a very constructive role mediating in the Gaza conflict".


Egypt's main liberal and secularist bloc, the National Salvation Front, has so far refused talks with Mursi unless he promises to include opposition figures in a national unity government.


"Stopping the violence is the priority, and starting a serious dialogue requires committing to guarantees demanded by the National Salvation Front, at the forefront of which are a national salvation government and a committee to amend the constitution," ElBaradei said on Twitter.


Those calls have also been backed by the hardline Islamist Nour party - rivals of Mursi's Muslim Brotherhood. Officials from Nour and the Front were due to meet on Wednesday to discuss Nour's proposals, suggesting an unlikely alliance of Mursi's critics from opposite ends of the political spectrum.


Mursi has agreed to the opposition demand to explore changes to the constitution he passed in a referendum last year, but has so far resisted the Front's calls for a unity government.


Brotherhood leader Mohamed El-Beltagy dismissed the unity government proposal as a ploy for the Front to take power despite having lost elections. On his Facebook page he ridiculed "the leaders of the Salvation Front, who seem to know more about the people's interests than the people themselves".


German industry leaders see potential in Egypt but are concerned about political instability.


"At the moment many firms are waiting on political developments and are cautious on any big investments," said Hans Heinrich Driftmann, president of Germany's Chamber of Industry and Commerce.


Mursi's supporters blame the opposition for preventing an economic recovery by halting efforts to restore stability. The opposition says an inclusive government is needed to bring calm.


"The economy depends on political stability and political stability depends on national consensus. But the Muslim Brotherhood does not talk about consensus, and so it will not lead to any improvement in the political situation, and that will lead the economy to collapse," said teacher Kamal Ghanim, 38, a protester in Tahrir Square.


(Additional reporting by Yasmine Saleh and Marwa Awad in Cairo, Stephen Brown and Gernot Heller in Berlin and Arshad Mohammed in Washington; Writing by Peter Graff; Editing by Giles Elgood)



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Army says political tussle taking Egypt to brink


CAIRO, Egypt (Reuters) - Egypt's army chief said political strife was pushing the state to the brink of collapse - a stark warning from the institution that ran the country until last year, as Cairo's first elected leader struggles to contain bloody street violence.


General Abdel Fattah al-Sisi, appointed by President Mohamed Mursi last year to head the military, added in a statement on Tuesday that one of the primary goals of deploying troops in cities on the Suez Canal was to protect the waterway that is vital for Egypt's economy and world trade.


Sisi's comments, published on an official army Facebook page, followed 52 deaths in the past week of disorder and highlighted the mounting sense of crisis facing Egypt and its Islamist head of state who is struggling to fix a teetering economy and needs to prepare Egypt for a parliamentary election in a few months that is meant to cement the new democracy.


The comments are unlikely to mean the army wants to take back the power it held, in effect, for six decades since the end of the colonial period and in the interim period after the overthrow of former general Hosni Mubarak two years ago.


But it sends a powerful message that the Egypt's biggest institution, with a huge economic as well as security role and a recipient of massive direct U.S. subsidies, is worried about the fate of the nation after five days of turmoil in major cities.


"The continuation of the struggle of the different political forces ... over the management of state affairs could lead to the collapse of the state," said General Abdel Fattah al-Sisi, who is also defense minister in the government Mursi appointed.


He said the economic, political and social challenges facing the country represented "a real threat to the security of Egypt and the cohesiveness of the Egyptian state" and the army would remain "the solid and cohesive block" on which the state rests.


Sisi was appointed by Mursi after the army handed over power to the new president in June. Mursi sacked Field Marshal Hussein Tantawi, who had been in charge of Egypt during the transition and who had also been Mubarak's defense minister for 20 years.


Political opponents spurned a call by Mursi for talks on Monday to try to end the violence. Instead, huge crowds of protesters took to the streets in Cairo and Alexandria, and in the three Suez Canal cities - Port Said, Ismailia and Suez - where Mursi on Sunday imposed emergency rule and a curfew.


"DOWN, DOWN MURSI"


Residents in the three canal cities demonstrated overnight in defiance of the curfew. At least two men died in fighting in Port Said, raising to at least 42 people who have now been killed there, most of them by gunshot wounds.


Protests first flared to mark the second anniversary of the uprising that erupted on January 25, 2011 and toppled Mubarak 18 days later. They have been exacerbated by riots in Port Said by residents enraged by a court ruling sentencing several people from the city to death over deadly soccer violence last year.


"Down, down with Mohamed Mursi! Down, down with the state of emergency!" crowds shouted in Ismailia. In Cairo, flames lit up the night sky as protesters set vehicles ablaze.


The demonstrators accuse Mursi of betraying the two-year-old revolution. Mursi and his supporters in the Muslim Brotherhood accuse the protesters of seeking to overthrow Egypt's first ever democratically elected leader by undemocratic means.


Debris from days of unrest was strewn on the streets around Cairo's Tahrir Square, cauldron of the anti-Mubarak uprising.


Youths clambered over a burned-out police van. But unlike on previous mornings in the past few days, there was no early sign of renewed clashes with police.


Since the 2011 revolt, Islamists who Mubarak spent his 30-year rule suppressing have won two referendums, two parliamentary elections and a presidential vote.


But that legitimacy has been challenged by an opposition that accuses Mursi of imposing a new form of authoritarianism, and punctuated by repeated waves of unrest that have prevented a return to stability in the most populous Arab state.


U.S. UNEASE


The army has already been deployed in Port Said and Suez and the government agreed a measure to let soldiers arrest civilians as part of the state of emergency.


The instability has provoked unease in Western capitals, where officials worry about the direction of a powerful regional player that has a peace deal with Israel. The United States condemned the bloodshed and called on Egyptian leaders to make clear violence is not acceptable.


Mursi's invitation to rivals to hold a national dialogue with Islamists on Monday was spurned by the main opposition National Salvation Front coalition, which described it as "cosmetic".


The only liberal politician who attended, Ayman Nour, told Egypt's al-Hayat channel after the meeting ended late on Monday that attendees agreed to meet again in a week.


He said Mursi had promised to look at changes to the constitution requested by the opposition but did not consider the opposition's request for a government of national unity. Mursi's pushing through last month of a new constitution which critics see as too Islamic remains a bone of contention.


The president announced the emergency measures on television on Sunday. "The protection of the nation is the responsibility of everyone. We will confront any threat to its security with force and firmness within the remit of the law," Mursi said.


His demeanor infuriated his opponents, not least when he wagged a finger, imperiously, at the camera.


Some activists said Mursi's measures to try to impose control on the turbulent streets could backfire.


"Martial law, state of emergency and army arrests of civilians are not a solution to the crisis," said Ahmed Maher of the April 6 movement that helped galvanize the 2011 uprising. "All this will do is further provoke the youth. The solution has to be a political one that addresses the roots of the problem."


(Additional reporting by Yasmine Saleh and Omar Fahmy in Cairo, Yusri Mohamed in Ismailia and Abdelrahman Youssef in Alexandria; Writing by Edmund Blair; Editing by Alastair Macdonald)



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Egypt's Mursi declares emergency after clashes kill dozens


CAIRO (Reuters) - Egyptian President Mohamed Mursi declared a month-long state of emergency in three cities on the Suez Canal, where dozens of people have been killed in protests that have swept the nation and deepened a political crisis facing the Islamist leader.


Hundreds of demonstrators in Port Said, Suez and Ismailia turned out against the decision within moments of Mursi's announcement late on Sunday, which came after the death toll from protests and violence that erupted last week hit 49.


Mursi also called for a national dialogue with his rivals for later on Monday, but the early response from members of the main opposition coalition suggested they saw little point, saying the president only seemed to listen to his allies.


Most deaths have been in Port Said, where 40 were killed in just two days. Riots were sparked on Saturday when a court sentenced to death several people from the city on charges related to deadly rioting at a soccer match last year. Mourners at Sunday's funerals in the port, where guns are common, directed their anger at Mursi.


Violence in Egypt's cities has extended to a fifth day. Police fired volleys of teargas at dozens of youths hurling stones on Monday near Cairo's Tahrir Square, where opponents have camped for weeks to protest against Mursi, who they say betrayed the revolution that ousted Hosni Mubarak two years ago.


"We want to bring down the regime and end the state that is run by the Muslim Brotherhood," said Ibrahim Eissa, a 26-year-old cook, protecting his face from teargas wafting towards him from police lines near Tahrir, the cauldron of the 2011 revolt.


Propelled to power in a June election by the Brotherhood, Mursi's presidency has lurched through a series of political crises and violent demonstrations, compounding his task of shoring up a teetering economy and preparing for a parliamentary election to cement the new democracy in a few months.


"The protection of the nation is the responsibility of everyone. We will confront any threat to its security with force and firmness within the remit of the law," Mursi said, offering condolences to families of victims in the canal zone cities.


"WASTE OF TIME"


Appealing to his opponents, the president called for a national dialogue on Monday at 6 p.m. (1600 GMT), inviting a range of Islamist allies as well as liberal, leftist and other opposition groups and individuals to discuss the crisis.


The main opposition National Salvation Front coalition gathered in Cairo to discuss a response, but several members have already suggested they do not expect much from the meeting, raising the prospect of poor attendance.


"Unless the president takes responsibility for the bloody events and pledges to form a government of national salvation and a balanced committee to amend the constitution, any dialogue will be a waste of time," Mohamed ElBaradei, a prominent politician who founded the Constitution Party, wrote on Twitter.


Hamdeen Sabahy, a leftist politician and presidential candidate who is another leading member of the Front, said he would not attend Monday's meeting "unless the bloodshed stops and the people's demands are met".


Ahmed Said of the liberal Free Egyptians Party said Mursi's tone on Sunday night was more threatening than conciliatory. "Egypt is in danger and completely split," he told Reuters.


Egypt's politics has become deeply polarized. Although Islamists have swept to victory in a parliamentary poll and presidential vote, the disparate opposition has been united by Mursi's bid late last year to expand his powers and fast-track a constitution with an Islamist hue through a referendum.


Mursi's opponents accuse him of listening only to his Islamist friends and reneging on a pledge to be a president for all Egyptians. Islamists say their rivals want to overthrow by undemocratic means Egypt's first freely elected leader.


The Front has distanced itself from the latest flare-ups but said Mursi should have acted far sooner to impose extra security measures that would have ended the violence.


BLAMING MURSI


"Of course we feel the president is missing the real problem on the ground, which is his own policies," spokesman Khaled Dawoud said. "His call to implement emergency law was an expected move, given what is going on, namely thuggery and criminal actions."


Even in Tahrir, some protesters said violence and the high death toll in Port Said and other cities on the strategic Suez waterway meant there was little choice but to impose emergency law, although they, too, blamed Mursi for fury on the streets.


"They needed the state of emergency there because there is so much anger," said Mohamed Ahmed, 27, a protester walking briskly from a cloud of teargas spreading into Tahrir Square.


However, activists in the three cities affected have pledged to defy the curfew that will start at 9 p.m. (1900 GMT) each evening and last until 6 a.m. (0400 GMT).


Some opposition groups have also called for more protests on Monday, which marks the second anniversary of one of the bloodiest days in the revolution that erupted on January 25, 2011, and brought an end to Mubarak's iron rule 18 days later.


Rights activists said Mursi's declaration was a backward step for Egypt, which was under emergency law for Mubarak's entire 30-year rule. His police used the sweeping arrest provisions to muzzle dissent and round up opponents, including members of the Brotherhood and even Mursi himself.


Heba Morayef of Human Rights Watch in Cairo said the police, still hated by many Egyptians for their heavy-handed tactics under Mubarak, would once again have the right to arrest people "purely because they look suspicious", undermining efforts to create a more efficient and respected police force.


"It is a classic knee-jerk reaction to think the emergency law will help bring security," she said. "It gives so much discretion to the Ministry of Interior that it ends up causing more abuse, which in turn causes more anger."


(Additional reporting by Yasmine Saleh in Cairo and Yusri Mohamed in Ismailia; Editing by Will Waterman)



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Egyptian youths, police clash in fourth day of violence


CAIRO (Reuters) - Police fired tear gas at dozens of stone-throwing protesters in Cairo on Sunday in a fourth day of street clashes that have killed at least 41 people and compounded the political challenges facing President Mohamed Mursi.


In the worst violence, security sources said 32 people died in Port Said on Saturday when protests erupted following a court verdict sentencing 21 people, mostly from the city, to death for their role in a deadly stadium disaster last year.


Mursi's opponents have also taken to the streets across Egypt since Thursday, accusing him and his Islamist allies of betraying the uprising that overthrew Hosni Mubarak in 2011.


"Till now, none of the revolution's goals have been realized," said Mohamed Sami, a protester in Tahrir Square on Sunday. "Prices are going up. The blood of Egyptians is being spilt in the streets because of neglect and corruption and because the Muslim Brotherhood is ruling Egypt for their own interests."


On a bridge close to Cairo's Tahrir Square, youths hurled stones at police in riot gear who fired tear gas to push them back towards the square which was the cauldron of the uprising that erupted on January 25, 2011 and toppled Mubarak 18 days later.


The latest protests were initially timed to mark Friday's second anniversary of that revolt.


The U.S. and British embassies, which are both close to Tahrir, said they were closed for public business on Sunday.


The spasm of violence adds to the daunting task facing Mursi as he tries to fix a beleaguered economy and cool tempers before a parliamentary election expected in the next few months which is supposed to cement Egypt's transition to democracy.


It has also exposed a deep rift in the nation. Liberals and other opponents accuse Mursi of failing to deliver on economic promises and say he has not lived up to pledges to represent all Egyptians. His backers say the opposition is seeking to topple Egypt's first freely elected leader by undemocratic means.


DIVISIONS


The army, Egypt's interim rulers until Mursi's election in June, were sent back onto the streets to restore order in Port Said and Suez, another port city on the Suez Canal where at least eight people have been killed in clashes with police.


Although scuffles continued in Cairo, there was no immediate sign of the kind of deadly escalation of previous days in the capital or elsewhere.


In Port Said, residents heard gunshots overnight and shops and many workplaces were shut on Sunday. Residents said the city was tense and there was a risk of further unrest later in the day when the dead were due to be buried.


Many Egyptians are frustrated by the regular escalations that have hurt the economy and their livelihoods.


"They are not revolutionaries protesting," said taxi driver Kamal Hassan, 30. "They are thugs destroying the country."


The National Defence Council, headed by Mursi, has called for a national dialogue to discuss political differences.


That offer has been cautiously welcomed by the opposition National Salvation Front. But the coalition has demanded a clear agenda and guarantees that any agreements will be implemented.


The Front, formed late last year when Mursi provoked protests and violence by expanding his powers and driving through an Islamist-tinged constitution, has threatened to boycott the parliamentary poll and to call for more protests if a list of demands is not met, including having an early presidential vote.


Egypt's transition has been blighted from the outset by political rows and turbulence on the streets that have driven investors out and kept many tourists away, starving the economy of vital sources of hard currency.


Egypt's defence minister who also heads the army, Abdel Fattah al-Sissi, called for the nation to stand together and said the military would not prevent peaceful protests. But he called on demonstrators to protect public property.


Clashes in Port Said erupted after a judge sentenced 21 men to die for involvement in 74 deaths at a soccer match on February 1, 2012 between Cairo's Al Ahly club and the local al-Masri team. Many of the victims were fans of the visiting team.


There were 73 defendants in the case. Those not sentenced on Saturday will face a verdict on March 9, the judge said.


Al Ahly fans cheered the verdict after threatening action if the death penalty was not meted out. But Port Said residents were furious that people from their city were held responsible, triggering wild rampages through the streets.


(Additional reporting by Shaimaa Fayed in Cairo and Yusri Mohamed in Ismailia; Editing by Andrew Heavens)



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Police and protesters clash in Egypt, army sent to Suez


CAIRO (Reuters) - Egyptian protesters scuffled with police in Cairo on Saturday and troops were deployed in Suez after nine people were shot dead in nationwide protests against President Mohamed Mursi, exposing deep rifts two years after Hosni Mubarak was ousted.


After a day of clashes on Friday, tension remained high with a court expected to rule later on Saturday in a case against suspects accused of involvement in a stadium disaster that killed 74 people. Fans have threatened violence if the court does not deliver the justice they seek.


Eight people including a policeman were shot dead in Suez, east of the capital, and another was shot and killed in Ismailia, another city on the Suez Canal, medics said, after a day when police fired tear gas at stone-throwing youths.


Another 456 people were injured across Egypt, officials said, in Friday's unrest fuelled by anger at Mursi and his Islamist allies over what the protesters see as their betrayal of the revolution that erupted on January 25, 2011.


"We want to change the president and the government. We are tired of this regime. Nothing has changed," said Mahmoud Suleiman, 22, in Cairo's Tahrir Square, near where youths were still hurling stones at police on the other side of a concrete barrier early on Saturday morning.


The protests and violence have laid bare the divide between the Islamists and their secular rivals. The schism is hindering the efforts of Mursi, elected in June, to revive an economy in crisis and reverse a plunge in Egypt's currency by enticing back investors and tourists.


Protesters accuse Mursi and his Islamist allies of hijacking Egypt's revolution that ended 30 years of Mubarak's autocratic rule. Mursi's supporters say their critics are ignoring democratic principles after elections swept Islamists to office.


"The protests will continue until we realize all the demands of the revolution - bread, freedom and social justice," Ahmed Salama, 28, a protester camped out with dozens of others in Tahrir Square, the cauldron of the 2011 revolt.


The court hearing over the Port Said stadium disaster in February last year has fuelled concerns of more unrest.


Live images were shown from inside the court shortly before the session began. Some of those attending chanted for justice and held up pictures of those killed.


The court on the outskirts on Cairo, and in the same police compound where Mubarak was tried and jailed, is due to rule on Saturday in the cases brought against 73 people, 61 of whom are charged with murder in what was Egypt's worst stadium disaster.


However, the public prosecutor has said new evidence has emerged, meaning a verdict may be postponed.


PRESIDENT URGES CALM


Alongside the 61 charged with murder, another 12 defendants, including nine police officers, are accused of helping to cause the February 1, 2012, disaster at the end of a match between Cairo's Al Ahly and al-Masri, the local side.


Expecting a verdict, hardcore Al Ahly fans, known as ultras, have protested in Cairo over the last week, obstructing the transport network. The Port Said disaster triggered days of street battles near the Interior Ministry in Cairo last year.


In a statement in response to Friday's violence, Mursi said the state would not hesitate in "pursuing the criminals and delivering them to justice". He urged Egyptians to respect the principles of the revolution by expressing views peacefully.


The president was due to meet later on Saturday with the National Defense Council, which includes senior ministers and security officials, to discuss the violence and deaths as a result of the protests.


Troops were deployed in Suez after the head of the state security police in the city asked for reinforcements. The army distributed pamphlets to residents assuring them the deployment was temporary and meant to secure the city.


"We have asked the armed forces to send reinforcements on the ground until we pass this difficult period," Adel Refaat, head of state security in Suez, told state television.


Street battles erupted in cities including Cairo, Alexandria, Suez and Port Said. Arsonists attacked at least two state-owned buildings. An office used by the Muslim Brotherhood's political party was also torched.


The Brotherhood decided against mobilizing for the anniversary, wary of the scope for more conflict after December's violence, stoked by Mursi's decision to fast-track an Islamist-tinged constitution rejected by his opponents.


Inspired by the popular uprising in Tunisia, Egypt's revolution spurred further revolts across the Arab world. But the sense of common purpose that united Egyptians two years ago has given way to internal strife that already triggered bloody street battles last month.


(Additional reporting by Tom Perry, Marwa Awad, Ali Abdelatti and Omar Fahmy; Writing by Edmund Blair; Editing by Andrew Heavens)



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North Korea threatens war with South over U.N. sanctions


SEOUL (Reuters) - North Korea threatened to attack rival South Korea if Seoul joined a new round of tightened U.N. sanctions, as Washington unveiled more of its own economic restrictions following Pyongyang's rocket launch last month.


In a third straight day of fiery rhetoric, the North directed its verbal onslaught at its neighbor on Friday, saying: "'Sanctions' mean a war and a declaration of war against us."


The reclusive North has this week declared a boycott of all dialogue aimed at ending its nuclear program and vowed to conduct more rocket and nuclear tests after the U.N. Security Council censured it for a December long-range missile launch.


"If the puppet group of traitors takes a direct part in the U.N. 'sanctions,' the DPRK will take strong physical counter-measures against it," the North's Committee for the Peaceful Reunification of Korea said, referring to the South.


The committee is the North's front for dealings with the South. DPRK is short for the North's official name, the Democratic People's Republic of Korea.


The U.N. Security Council unanimously condemned North Korea's December rocket launch on Tuesday and expanded existing U.N. sanctions.


On Thursday, the United States slapped economic sanctions on two North Korean bank officials and a Hong Kong trading company that it accused of supporting Pyongyang's proliferation of weapons of mass destruction.


The company, Leader (Hong Kong) International Trading Ltd, was separately blacklisted by the United Nations on Wednesday.


Seoul has said it will look at whether there are any further sanctions that it can implement alongside the United States, but said the focus for now is to follow Security Council resolutions.


The resolution said the council "deplores the violations" by North Korea of its previous resolutions, which banned Pyongyang from conducting further ballistic missile and nuclear tests and from importing materials and technology for those programs. It does not impose new sanctions on Pyongyang.


The United States had wanted to punish North Korea for the rocket launch with a Security Council resolution that imposed entirely new sanctions against Pyongyang, but Beijing rejected that option. China agreed to U.N. sanctions against Pyongyang after North Korea's 2006 and 2009 nuclear tests.


NUCLEAR TEST WORRY


North Korea's rhetoric this week amounted to some of the angriest outbursts against the outside world coming under the leadership of Kim Jong-un, who took over after the death of his father Kim Jong-il in late 2011.


On Thursday, the North said it would carry out further rocket launches and a nuclear test, directing its ire at the United States, a country it called its "sworn enemy".


U.S. Defense Secretary Leon Panetta said the comments were worrying.


"We are very concerned with North Korea's continuing provocative behavior," he said at a Pentagon news conference.


"We are fully prepared ... to deal with any kind of provocation from the North Koreans. But I hope in the end that they determine that it is better to make a choice to become part of the international family."


North Korea is not believed to have the technology to deliver a nuclear warhead capable of hitting the continental United States, although its December launch showed it had the capacity to deliver a rocket that could travel 10,000 km (6,200 miles), potentially putting San Francisco in range, according to an intelligence assessment by South Korea.


South Korea and others who have been closely observing activities at the North's known nuclear test grounds believe Pyongyang is technically ready to go ahead with its third atomic test and awaiting the political decision of its leader.


The North's committee also declared on Friday that a landmark agreement it signed with the South in 1992 on eliminating nuclear weapons from the Korean peninsula was invalid, repeating its long-standing accusation that Seoul was colluding with Washington.


The foreign ministry of China, the North's sole remaining major diplomatic and economic benefactor, repeated its call for calm on the Korean peninsula at its daily briefing on Friday.


"The current situation on the Korea peninsula is complicated and sensitive," spokesman Hong Lei said.


"We hope all relevant parties can see the big picture, maintain calm and restraint, further maintain contact and dialogue, and improve relations, while not taking actions to further complicate and escalate the situation," Hong said.


But unusually prickly comments in Chinese state media on Friday hinted at Beijing's exasperation.


"It seems that North Korea does not appreciate China's efforts," said the Global Times in an editorial, a sister publication of the official People's Daily.


"Just let North Korea be 'angry' ... China hopes for a stable peninsula, but it's not the end of the world if there's trouble there. This should be the baseline of China's position."


(Additional reporting by Michael Martina in Beijing; editing by Jeremy Laurence and Raju Gopalakrishnan)



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North Korea to target U.S. with nuclear, rocket tests


SEOUL (Reuters) - North Korea said on Thursday it would carry out further rocket launches and a nuclear test that would target the United States, dramatically stepping up its threats against a country it called its "sworn enemy".


The announcement by the country's top military body came a day after the U.N. Security Council agreed to a U.S.-backed resolution to censure and sanction North Korea for a rocket launch in December that breached U.N. rules.


"We are not disguising the fact that the various satellites and long-range rockets that we will fire and the high-level nuclear test we will carry out are targeted at the United States," North Korea's National Defence Commission said, according to state news agency KCNA.


North Korea is believed by South Korea and other observers to be "technically ready" for a third nuclear test, and the decision to go ahead rests with leader Kim Jong-un who pressed ahead with the December rocket launch in defiance of the U.N. sanctions.


China, the one major diplomatic ally of the isolated and impoverished North, agreed to the U.S.-backed resolution and it also supported resolutions in 2006 and 2009 after Pyongyang's two earlier nuclear tests.


Thursday's statement by North Korea represents a huge challenge to Beijing as it undergoes a leadership transition with Xi Jinping due to take office in March.


China's Foreign Ministry called for calm and restraint and a return to six-party talks, but effectively singled out North Korea, urging the "relevant party" not to take any steps that would raise tensions.


"We hope the relevant party can remain calm and act and speak in a cautious and prudent way and not take any steps which may further worsen the situation," ministry spokesman Hong Lei told reporters at a regular press briefing.


North Korea has rejected proposals to restart the talks aimed at reining in its nuclear capacity. The United States, China, Russia, Japan and the two Koreas are the six parties involved.


"After all these years and numerous rounds of six-party talks we can see that China's influence over North Korea is actually very limited. All China can do is try to persuade them not to carry out their threats," said Cai Jian, an expert on Korea at Fudan University in Shanghai.


Analysts said the North could test as early as February as South Korea prepares to install a new, untested president or that it could choose to stage a nuclear explosion to coincide with former ruler Kim Jong-il's Feb 16 birthday.


"North Korea will have felt betrayed by China for agreeing to the latest U.N. resolution and they might be targeting (China) as well (with this statement)," said Lee Seung-yeol, senior research fellow at Ewha Institute of Unification Studies in Seoul.


U.S. URGES NO TEST


Washington urged North Korea not to proceed with a third test just as the North's statement was published on Thursday.


"Whether North Korea tests or not is up to North Korea," Glyn Davies, the top U.S. envoy for North Korean diplomacy, said in the South Korean capital of Seoul.


"We hope they don't do it. We call on them not to do it," Davies said after a meeting with South Korean officials. "This is not a moment to increase tensions on the Korean peninsula."


The North was banned from developing missile and nuclear technology under sanctions dating from its 2006 and 2009 nuclear tests.


A South Korean military official said the concern now is that Pyongyang could undertake a third nuclear test using highly enriched uranium for the first time, opening a second path to a bomb.


North Korea's 2006 nuclear test using plutonium produced a puny yield equivalent to one kiloton of TNT - compared with 13-18 kilotons for the Hiroshima bomb - and U.S. intelligence estimates put the 2009 test's yield at roughly two kilotons


North Korea is estimated to have enough fissile material for about a dozen plutonium warheads, although estimates vary, and intelligence reports suggest that it has been enriching uranium to supplement that stock and give it a second path to the bomb.


According to estimates from the Institute for Science and International Security from late 2012, North Korea could have enough weapons grade uranium for 21-32 nuclear weapons by 2016 if it used one centrifuge at its Yongbyon nuclear plant to enrich uranium to weapons grade.


North Korea gave no time-frame for the coming test and often employs harsh rhetoric in response to U.N. and U.S. actions that it sees as hostile.


Its long-range rockets are not seen as capable of reaching the United States mainland and it is not believed to have the technology to mount a nuclear warhead on a long-range missile.


The bellicose statement on Thursday appeared to dent any remaining hopes that Kim Jong-un, believed to be 30 years old, would pursue a different path from his father Kim Jong-il, who oversaw the country's military and nuclear programs.


The older Kim died in December 2011.


"The UNSC (Security Council) resolution masterminded by the U.S. has brought its hostile policy towards the Democratic Peoples Republic of Korea (North Korea) to its most dangerous stage," the commission was quoted as saying.


(Additional reporting by Christine Kim in SEOUL, Ben Blanchard and Sui-Lee Wee in Beijing; Writing by David Chance; Editing by Raju Gopalakrishnan)



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Cameron promises Britons straight choice on EU exit


LONDON (Reuters) - Prime Minister David Cameron promised on Wednesday to give Britons a straight referendum choice on whether to stay in the European Union or leave, provided he wins an election in 2015.


Cameron ended months of speculation by announcing in a speech the plan for a vote sometime between 2015 and the end of 2017, shrugging off warnings that this could imperil Britain's diplomatic and economic prospects and alienate its allies.


Cameron said Britain did not want to pull up the drawbridge and retreat from the world but that public disillusionment with the EU is at "an all-time high".


"It is time for the British people to have their say. It is time for us to settle this question about Britain and Europe," Cameron said. His Conservative party would campaign for the 2015 election promising to renegotiate Britain's EU membership.


"When we have negotiated that new settlement, we will give the British people a referendum with a very simple in or out choice to stay in the European Union on these new terms; or come out altogether. It will be an in-out referendum."


Cameron said he wants Britain to claw back some powers from Brussels, a proposal that other European countries reject. Britain would do an "audit" to determine what powers Brussels had that should best be delegated to member states.


Sterling fell to its lowest in nearly five months against the dollar on Wednesday as Cameron was speaking.


Whether Cameron will ever hold the referendum remains as uncertain as the Conservatives' chances of winning the next election due in 2015.


They trail the opposition Labour party in opinion polls, and the coalition government is pushing through painful public spending cuts to try to reduce Britain's large budget deficit, likely to upset voters in the meantime.


Cameron's promise looks likely to satisfy much of his own party, which has been split on the issue, but may create uncertainty when events could put his preferred option - a looser version of full British membership - out of reach.


The move may also unsettle other EU states, such as France and Germany. European officials have already warned Cameron against treating the bloc as an "a la carte menu" from which he can pick and choose membership terms.


The United States, a close ally, has said it wants Britain to remain inside the EU with "a strong voice".


The speech could also exacerbate rifts with Cameron's pro-European Liberal Democrat junior coalition partners.


Cameron said he would prefer Britain, the world's sixth biggest economy, to remain inside the 27-nation EU but he also made clear he believes the EU must be radically reformed. It was riskier to maintain the status quo than to change, he said.


"The biggest danger to the European Union comes not from those who advocate change, but from those who denounce new thinking as heresy," he said.


If Britain left the EU, Cameron said it would be "a one-way ticket, not a return", adding however that he would campaign to stay inside a reformed EU "with all my heart and soul".


"WAFER THIN" CONSENT


Cameron said the euro zone debt crisis was forcing the bloc to change, and Britain would fight to make sure new rules are fair to countries that do not use the common currency. Britain is the largest of the 10 EU members that do not use the euro.


Democratic consent for the EU in Britain was now "wafer thin", he said, reflecting the results of opinion polls that show a slim majority would vote to leave the bloc and the rise of the UK Independence Party that favors complete withdrawal.


"Some people say that to point this out is irresponsible, creates uncertainty for business and puts a question mark over Britain's place in the European Union," said Cameron. "But the question mark is already there: ignoring it won't make it go away."


Avoiding a referendum would make an eventual British exit more likely, not less, he said.


"Simply asking the British people to carry on accepting a European settlement over which they have had little choice is a path to ensuring that when the question is finally put - and at some stage it will have to be - it is much more likely that the British people will reject the European Union."


Asked after the speech whether other EU countries would agree to renegotiate Britain's membership, Cameron said he was an optimist and that there was "every chance of success."


"I want to be the prime minister who confronts and gets the right answer for Britain on these kind of issues," he said.


Cameron's speech has been marked by long delays and was postponed from last week due to the Algerian hostage crisis.


(Editing by Guy Faulconbridge and Peter Graff)



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Israel goes to polls, set to re-elect Netanyahu


JERUSALEM (Reuters) - Israelis voted on Tuesday in an election that is expected to see Prime Minister Benjamin Netanyahu win a third term in office, pushing the Jewish state further to the right, away from peace with the Palestinians and towards a showdown with Iran.


However, Netanyahu's own Likud party, running alongside the ultra-nationalist Yisrael Beitenu group, looks set to have fewer seats than in the previous parliament, with opinion polls showing a surge in support for the far-right Jewish Home party.


Political sources said Netanyahu, concerned by his apparent fall in popularity, might approach centre-left parties after the vote in an effort to broaden his coalition and present a more moderate face to Washington and other concerned allies.


"We want Israel to succeed, we vote Likud-Beitenu ... The bigger it is, the more Israel will succeed," Netanyahu said after casting his ballot alongside his wife and two sons.


Some 5.66 million Israelis are eligible to vote, with polling stations closing at 10 p.m. (2000 GMT). Full results are due by Wednesday morning, opening the way for coalition talks that could take several weeks.


The lackluster election campaign failed to focus on any single issue and with a Netanyahu victory predicted by every opinion poll, the two main political blocs seemed to spend more time on internal feuding than confronting each other.


"There is a king sitting on the throne in Israel and I wanted to dethrone him, but it looks like that won't happen," said Yehudit Shimshi, a retired teacher voting in central Israel, on a bright, hot mid-winter morning.


No Israeli party has ever secured an absolute majority, meaning that Netanyahu, who says that dealing with Iran's nuclear ambitions is his top priority, will have to bring various allies onboard to control the 120-seat Knesset.


The former commando has traditionally looked to religious, conservative parties for backing and is widely expected to seek out the surprise star of the campaign, self-made millionaire Naftali Bennett who heads the Jewish Home party.


Bennett has ruled out any peace pact with the Palestinians and calls for the annexation of much of the occupied West Bank.


His youthful dynamism has struck a chord amongst Israelis, most of whom no longer believe in the possibility of a Palestinian deal, and has eroded Netanyahu's support base.


The Likud has also shifted further right in recent months, with hardline candidates who reject the so-called two-state solution, dominating the top of the party list.


"TRENDY PARTIES"


Surveys suggest Bennett may take up to 14 seats, many at the expense of Likud-Beitenu, which was projected to win 32 in the last round of opinion polls published on Friday -- 10 less than the two parties won in 2009 when they ran separate lists.


Acknowledging the threat, Netanyahu's son Yair urged young Israelis not to abandon the old, established Likud.


"Even if there are more trendy parties, there is one party that has a proven record," he said on Tuesday.


Amongst the new parties standing for the first time in an election were Yesh Atid (There is a Future), a centrist group led by former television host Yair Lapid, seen winning 13 seats.


"All our lives we voted Likud, but today we voted for Lapid because we want a different coalition," said Ahuva Heled, 55, a retired teacher voting with her husband north of Tel Aviv.


Lapid has not ruled out joining a Netanyahu cabinet, but is pushing hard for ultra-Orthodox Jews to do military service -- a demand fiercely rejected by some allies of the prime minister.


Israel's main opposition party, Labour, which is seen capturing up to 17 seats, has already ruled out a repeat of 2009, when it initially hooked up with Netanyahu, promising to promote peace negotiations with the Palestinians.


U.S.-brokered talks collapsed just a month after they started in 2010 following a row over settlement building, and have laid in ruins ever since. Netanyahu blamed the Palestinians for the failure and says his door remains open to discussions.


Palestinian President Mahmoud Abbas says he won't return to the table unless there is a halt to settlement construction.


That looks unlikely, with Netanyahu approving some 11,000 settler homes in December alone, causing further strains to his already notoriously difficult relations with U.S. President Barack Obama, who was sworn in for a second term on Monday.


IRAN THREAT


Tuesday's vote is the first in Israel since Arab uprisings swept the region two years ago, reshaping the Middle East.


Netanyahu has said the turbulence - which has brought Islamist governments to power in several countries long ruled by secularist autocrats, including neighboring Egypt - shows the importance of strengthening national security.


If he wins on Tuesday, he will seek to put Iran back to the top of the global agenda. Netanyahu has said he will not let Tehran enrich enough uranium to make a single nuclear bomb - a threshold Israeli experts say could arrive as early as mid-2013.


Iran denies it is planning to build the bomb, and says Israel, widely believed to have the only nuclear arsenal in the Middle East, is the biggest threat to the region.


The issue has barely registered during the election campaign, with a poll in Haaretz newspaper on Friday saying 47 percent of Israelis thought social and economic issues were the most pressing concern, against just 10 percent who cited Iran.


One of the first problems to face the next government, which is unlikely to take power before the middle of next month at the earliest, is the stuttering economy.


Data last week showed the budget deficit rose to 4.2 percent of gross domestic product in 2012, double the original estimate, meaning spending cuts and tax hikes look certain.


(Additional reporting by Ori Lewis, Jeffrey Heller and Tova Cohen; Editing by Giles Elgood)



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Algeria finds dead Canadian militants as siege toll rises


ALGIERS (Reuters) - Algerian special forces have found the bodies of two Canadian Islamist fighters after a bloody siege at a desert gas plant, a security source said on Monday, as the death toll reached at least 80 after troops stormed the complex to end the hostage crisis.


Algerian Prime Minister Abdelmalek Sellal is expected to give details later in the day about the siege near the town of In Amenas, which left American, British, French, Japanese, Norwegian, Filipino and Romanian workers dead or missing.


The Algerian security source told Reuters that documents found on the bodies of the two militants had identified them as Canadians, as forces scoured the plant following Saturday's bloody end to the crisis.


Veteran Islamist fighter Mokhtar Belmokhtar claimed responsibility for the attack on behalf of al Qaeda, and an official Algerian source has said the militants included people from outside the African continent, as well as Arabs and Africans.


A security source said on Sunday that Algerian troops had found the bodies of 25 hostages, raising the number of hostages killed to 48 and the total number of deaths to at least 80. He said six militants were captured alive and troops were still searching for others.


A Japanese government source said the Algerian government had informed Tokyo that nine Japanese had been killed, the biggest toll so far among foreigners at the plant. Six Filipinos died and four were wounded, a government spokesman in Manila said.


The raid has exposed the vulnerability of multinational-run oil and gas installations in an important producing region and pushed the growing threat from Islamist militant groups in the Sahara to a prominent position in the West's security agenda.


ONE-EYED JIHADIST


Belmokhtar - a one-eyed jihadist who fought in Afghanistan and Algeria's civil war of the 1990s when the secular government fought Islamists - tied the desert attack to France's intervention across the Sahara against Islamist rebels in Mali.


"We in al Qaeda announce this blessed operation," he said in a video, according to Sahara Media, a regional website. About 40 attackers participated in the raid, he said, roughly matching the government's figures for fighters killed and captured.


Belmokhtar demanded an end to French air strikes against Islamist fighters in neighboring Mali. These began five days before the fighters swooped out of the desert before dawn on Wednesday and seized a plant that produces 10 percent of Algeria's natural gas exports.


However, U.S. and European officials doubt such a complex raid could have been organized quickly enough to have been conceived as a direct response to the French military intervention.


The group behind the raid, the Mulathameen Brigade, also threatened to carry out more such attacks if Western powers did not end what it called an assault on Muslims in Mali, according to the SITE service, which monitors militant statements.


In a statement published by the Mauritania-based Nouakchott News Agency, the hostage takers said they had offered talks about freeing the captives, but the Algerian authorities had been determined to use military force.


"We opened the door for negotiations with the Westerners and the Algerians, and granted them safety from the beginning of the operation, but one of the senior (Algerian) intelligence officials confirmed to us in a phone call that they will destroy the place with everyone in it," SITE quoted the statement as saying.


BLOODY SIEGE


The siege turned bloody on Thursday when the Algerian army opened fire, saying fighters were trying to escape with their prisoners. Survivors said Algerian forces blasted several trucks in a convoy carrying both hostages and their captors.


Nearly 700 Algerian workers and more than 100 foreigners escaped, mainly on Thursday when the fighters were driven from the residential barracks. Some captors remained holed up in the industrial complex until Saturday when they were overrun.


The bloodshed has strained Algeria's relations with its Western allies, some of which have complained about being left in the dark while the decision to storm the compound was being taken.


Nevertheless, Britain and France both defended the military action by Algeria, the strongest military power in the Sahara and an ally the West needs in combating the militants.


Among other foreigners confirmed dead by their home countries were three Britons, one American and two Romanians. The missing include five Norwegians, three Britons and a British resident. An Algerian security source said at least one Frenchman was also among the dead.


The raid on the plant, which was home to expatriate workers from Britain's BP, Norway's Statoil, Japanese engineering firm JGC Corp and others, exposed the vulnerability of multinational oil operations in the Sahara.


However, Algeria is determined to press on with its energy industry. Oil Minister Youcef Yousfi visited the site and said physical damage was minor, state news service APS reported. The plant would start up again in two days, he said.


Algeria, scarred by the civil war with Islamist insurgents in the 1990s which claimed 200,000 lives, insisted from the start of the crisis there would be no negotiation in the face of terrorism. France especially needs close cooperation from Algeria to crush Islamist rebels in northern Mali.


(Additional reporting by Anton Slodkowski in Tokyo, Balazs Koranyi in Oslo, William Maclean in Dubai, Estelle Shirbon and David Alexander in London, Brian Love in Paris and Daniel Flynn in Dakar; Writing by David Stamp; Editing by Giles Elgood)



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Algeria ends desert siege with 23 hostages dead


ALGIERS/IN AMENAS, Algeria (Reuters) - Algerian troops ended a siege by Islamist militants at a gas plant in the Sahara desert where 23 hostages died, with a final assault which killed all the remaining hostage-takers.


Believed to be among the 32 dead militants was their leader, Abdul Rahman al-Nigeri, a Nigerien close to al Qaeda-linked commander Mokhtar Belmokhtar, presumed mastermind of the raid.


An Algerian interior ministry statement on the death toll gave no breakdown of the number of foreigners among hostages killed since the plant was seized before dawn on Wednesday.


Details are only slowly emerging on what happened during the siege, which marked a serious escalation of unrest in northwestern Africa, where French forces are ratcheting up a war against Islamist militants in neighboring Mali.


Algeria's interior ministry said on Saturday that 107 foreign hostages and 685 Algerian hostages had survived, but did not give a detailed breakdown of those who died.


"We feel a deep and growing unease ... we fear that over the next few days we will receive bad news," said Helge Lund, Chief Executive of Norway's Statoil, which ran the plant along with Britain's BP and Algeria's state oil company.


"People we have spoken to describe unbelievable, horrible experiences," he said.


British Prime Minister David Cameron said he feared for the lives of five British citizens unaccounted for at the gas plant near the town of In Amenas, which was also home to expatriate workers from Japanese engineering firm JGC Corp and others.


One American and one British citizen have been confirmed dead. Statoil said five of its workers, all Norwegian nationals, were still missing. Japanese and American workers are also unaccounted for.


The Islamists' attack has tested Algeria's relations with the outside world, exposed the vulnerability of multinational oil operations in the Sahara and pushed Islamist radicalism in northern Africa to center stage.


Some Western governments expressed frustration at not being informed of the Algerian authorities' plans to storm the complex. Algeria, scarred by a civil war with Islamist insurgents in the 1990s which claimed 200,000 lives, had insisted there would be no negotiation in the face of terrorism.


President Barack Obama said on Saturday the United States was seeking from Algerian authorities a fuller understanding of what took place, but said "the blame for this tragedy rests with the terrorists who carried it out."


Official sources had no immediate confirmation of newspaper reports suggesting some of the hostages may have been executed by their captors as the Algerian army closed in for the final assault on Saturday.


One source close to the crisis said 16 foreign hostages were freed, including two Americans and one Portuguese.


BP's chief executive Bob Dudley said on Saturday four of its 18 workers at the site were missing. The remaining 14 were safe.


PLANNED BEFORE FRENCH LANDED IN MALI


The attack on the heavily fortified gas compound was one of the most audacious in recent years and almost certainly planned long before French troops launched a military operation in Mali this month to stem an advance by Islamist fighters.


Hundreds of hostages escaped on Thursday when the army launched a rescue operation, but many hostages were killed.


Before the interior ministry released its provisional death toll, an Algerian security source said eight Algerians and at least seven foreigners were among the victims, including two Japanese, two Britons and a French national. One British citizen was killed when the gunmen seized the hostages on Wednesday.


The U.S. State Department said on Friday one American, Frederick Buttaccio, had died but gave no further details.


U.S. Defense Secretary Leon Panetta said nobody was going to attack the United States and get away with it.


"We have made a commitment that we're going to go after al Qaeda wherever they are and wherever they try to hide," he said during a visit to London. "We have done that obviously in Afghanistan, Pakistan, we've done it in Somalia, in Yemen and we will do it in North Africa as well."


Earlier on Saturday, Algerian special forces found 15 unidentified burned bodies at the plant, a source told Reuters.


Mauritanian news agencies identified the field commander of the group that attacked the plant as Nigeri, a fighter from one of the Arab tribes in Niger who had joined the Algerian Salafist Group for Preaching and Combat (GSPC) in early-2005.


That group eventually joined up with al Qaeda to become Al Qaeda in the Islamic Maghreb (AQIM). It and allied groups are the targets of the French military operation in Mali.


The news agencies described him as "one of the closest people" to Belmokhtar, who fought in Afghanistan and then in Algeria's civil war of the 1990s. Nigeri was known as a man for "difficult missions", having carried out attacks in Mauritania, Mali and Niger.


NO NEGOTIATION


Britain, Japan and other countries have expressed irritation that the Algerian army assault was ordered without consultation.


But French President Francois Hollande said the Algerian military's response seemed to have been the best option given that negotiation was not possible.


"When you have people taken hostage in such large number by terrorists with such cold determination and ready to kill those hostages - as they did - Algeria has an approach which to me, as I see it, is the most appropriate because there could be no negotiation," Hollande said.


The apparent ease with which the fighters swooped in from the dunes to take control of an important energy facility, which produces some 10 percent of the natural gas on which Algeria depends for its export income, has raised questions over the country's outwardly tough security measures.


Algerian officials said the attackers may have had inside help from among the hundreds of Algerians employed at the site.


Security in the half-dozen countries around the Sahara desert has long been a preoccupation of the West. Smugglers and militants have earned millions in ransom from kidnappings.


The most powerful Islamist groups operating in the Sahara were severely weakened by Algeria's secularist military in the civil war in the 1990s. But in the past two years the regional wing of al Qaeda gained fighters and arms as a result of the civil war in Libya, when arsenals were looted from Muammar Gaddafi's army.


(Additional reporting by Balazs Koranyi in Oslo, Estelle Shirbon and David Alexander in London, Brian Love in Paris; Writing by Giles Elgood and Myra MacDonald)



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