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

Iran upbeat on nuclear talks, West wary

ALMATY (Reuters) - Iran gave an upbeat assessment of two days of nuclear talks with world powers that ended on Wednesday, but Western officials said Tehran must start taking concrete steps to ease mounting concerns about its atomic activity.

The first negotiations between Iran and six world powers in eight months ended without a breakthrough in Almaty, but they agreed to meet again at expert level in Istanbul next month and resume political discussions in the Kazakh city on April 5.

Israel, assumed to be the Middle East's only nuclear-armed power, is watching the talks closely. It has strongly hinted it might attack Iran if diplomacy and sanctions fail to stop it from acquiring nuclear weapons. Iran denies any such aim.

Iran's foreign minister said he was optimistic an agreement could be reached with the powers - the United States, France, Russia, Britain, Germany and China - on the country's disputed nuclear program.

"Very confident," Ali Akbar Salehi told Reuters when asked on the sidelines of a U.N. conference in Vienna how confident he was of a positive outcome.

The six powers offered at the February 26-27 Almaty meeting to lift some sanctions if Iran scaled back nuclear activity that the West fears could be used to build a bomb.

Tehran, which says its program is entirely peaceful, did not agree to do so and the sides did not appear any closer to a deal to resolve a decade-old dispute that could lead to another war in the Middle East if diplomacy fails.

But Iran still said the talks were a positive step in which the six powers tried to "get closer to our viewpoint".

Western officials had made clear they did not expect major progress in Almaty, aware that the closeness of Iran's presidential election in June is raising political tensions in Tehran and makes significant concessions unlikely.

"I hope the Iranian side is looking positively on the proposal we put forward," said European Union foreign policy chief Catherine Ashton, who led the talks on behalf of the powers. "We have to see what happens next."

The United States did not expect a breakthrough and "the result was clearly in line with those expectations," a senior U.S. official said.

The meeting was "useful" as the two sides agreed dates and venues for follow-up talks but there was a need for progress on confidence building measures, the official added.


The West's immediate priority is that Iran halts higher-grade uranium enrichment and closes an underground facility, Fordow, where this work is carried out. The material is a relatively short technical step from bomb-grade uranium.

"What we care about at the end is concrete results," the U.S. official said.

One diplomat in Almaty said the Iranians appeared to be suggesting at the negotiations that they were opening new avenues, but that it was not clear if this was really the case.

Both sides said experts would meet for talks in the Turkish city of Istanbul on March 18 and that political negotiators would return to Almaty on April 5-6.

Russian negotiator Sergei Ryabkov confirmed that the powers had offered to ease sanctions on Iran if it stops enriching uranium to 20 percent fissile purity - a short technical step from weapons grade - at the Fordow underground site where it carries out its most controversial uranium enrichment work.

Western officials said the offer of sanctions relief included a resumption of trade in gold and precious metals.

One diplomat said that lifting an embargo on imports of Iranian petrochemical products to Europe, if Iran responded, was also on the table. But a U.S. official said the world powers had not offered to suspend oil or financial sanctions.

The sanctions are hurting Iran's economy and its chief nuclear negotiator, Saeed Jalili, suggested Iran could discuss its production of higher-grade nuclear fuel, although he appeared to rule out shutting Fordow.

In comments in Persian translated into English, Jalili told a news conference Fordow was under the supervision of the U.N. nuclear watchdog and there was no justification for closing it.


Asked about the production of 20-percent enriched fuel, he reiterated Iran's position that it needed this for a research reactor and had a right to produce it.

Iran says its enrichment program is aimed solely at fuelling nuclear power plants so that it can export more oil, and that Israel's assumed nuclear arsenal is the main threat to peace in the region.

But Jalili did indicate that Iran might be prepared to talk about the issue, saying: "This can be discussed in the negotiations ... in view of confidence building."

Iran has also previously suggested that 20-percent enrichment was up for negotiation if it received the fuel from abroad instead. It also wants sanctions lifted.

"While an agreement to meet again may not impress skeptics of diplomacy, an important development did occur," said Trita Parsi, an expert on Iran. "The parties began searching for a solution by offering positive measures in order to secure concessions from the other side.

Another expert, Dina Esfandiary of the International Institute for Strategic Studies, said: "I note that the mood is more optimistic and that's great, but a deal still hasn't been reached and in my view its unlikely to be reached before the Iranian elections have come and gone."

(Additional reporting Fredrik Dahl in Almaaty, Georgina Prodhan in Vienna, Zahra Hosseinian in Zurich, Gabriela Baczynska in Moscow, Dan Williams in Jerusalem and Marcus George in Dubai; Writing by Timothy Heritage and Fredrik Dahl; Editing by Jon Hemming)

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Italy faces post-vote stalemate, spooking investors

ROME (Reuters) - The Italian stock market fell and state borrowing costs rose on Tuesday as investors took fright at political deadlock after a stunning election that saw a comedian's protest party lead the poll and no group secure a clear majority in parliament.

"The winner is: Ingovernability" ran the headline in Rome newspaper Il Messaggero, reflecting the stalemate the country would have to confront in the next few weeks as sworn enemies would be forced to work together to form a government.

In a sign of where that might lead, former prime minister Silvio Berlusconi indicated his center-right might be open to a grand coalition with the center-left bloc of Pier Luigi Bersani, which will have a majority in the lower house thanks to a premium of seats given to the largest bloc in the chamber.

Results in the upper house, the Senate, where seats are awarded on a region-by-region basis, indicated the center-left would end up with about 119 seats, compared with 117 for the center-right. But 158 are needed for a majority to govern.

Any coalition administration that may be formed must have a working majority in both houses in order to pass legislation.

Comedian Beppe Grillo's anti-establishment 5-Star Movement won the most votes of any single party, taking 25 percent. He shows no immediate inclination to cooperate with other groups.

Despite talk of a new election, the main established parties seem likely to try to avoid that, fearing even more humiliation.

World financial markets reacted nervously to the prospect of a stalemate in the euro zone's third largest economy with memories still fresh of the crisis that took the 17-member currency bloc to the brink of collapse in 2011.

In a clear sign of worry at the top over what effect the elections could have on the economy, Prime Minister Mario Monti, whose austerity policies were repudiated by voters, called a meeting with the governor of the central bank, the economy minister and the European affairs minister for later on Tuesday.

Other governments in the euro zone sounded uneasy. Allies of German Chancellor Angela Merkel made no secret of disappointment at Monti's debacle and urged Rome to continue with economic reforms Berlin sees as vital to stabilizing the common currency.

France's Socialist finance minister also expressed "worry" at the prospect of legislative deadlock in Italy but said that Italians had rejected austerity and hoped Bersani's center-left could form a stable government to help foster growth in Europe.


Fabio Fois, an economist at Barclays bank, said: "Political instability is likely to prevail in the near term and slow the implementation of much needed structural reforms unless a grand coalition among center-left, center-right and center is formed."

Berlusconi, a media magnate whose campaigning all but wiped out Bersani's once commanding opinion poll lead, hinted in a telephone call to a morning television show that he would be open to a deal with the center-left - but not with Monti, the technocrat summoned to replace him in a crisis 15 months ago.

"Italy must be governed," Berlusconi said, adding that he "must reflect" on a possible deal with the center-left. "Everyone must be prepared to make sacrifices," he said of the groups which now have a share of the legislature.

The Milan bourse was down more than four percent and the premium Italy pays over Germany to borrow on 10-year widened to a yield spread of 338.7 basis points, the highest since December 10.

At an auction of six-month Treasury bills, the government's borrowing costs shot up by more than two thirds. Investors demanded a yield of 1.237 percent, the highest since October and compared to just 0.730 percent in a similar sale a month ago.

Berlusconi, who was forced from office in November 2011 as borrowing costs approached levels investors feared would become unsustainable, said he was "not worried" about market reaction to the election and played down the significance of the spread.

The poor showing by Monti's centrist bloc reflected a weariness with austerity that was exploited by both Berlusconi and Grillo; only with the help of center-left allies did Bersani beat 5-Star, by just 125,000 votes, to control the lower house.

The worries immediately went beyond Italy's borders.

"What is crucial now is that a stable functioning government can be built as swiftly as possible," said German Foreign Minister Guido Westerwelle. "This is not only in the interests of Italy but in the interests of all Europe."

The euro skidded to an almost seven-week low against the dollar in Asia on fears about the euro zone's debt crisis. It fell as far as $1.3042, its lowest since January 10.


Commentators said all Grillo's adversaries underestimated the appeal of a grassroots movement that called itself a "non-party", particularly its allure among young Italians who find themselves without jobs and the prospect of a decent future.

The 5-star Movement's score of 25.5 percent in the lower house was just ahead of the 25.4 percent for Bersani's Democratic Party, which ran in a coalition with the leftist SEL party, and it won almost 8.7 million votes overall - more than any other single party.

"The 'non-party' has become the largest party in the country," said Massimo Giannini, commentator for Rome newspaper La Repubblica, of Grillo, who mixes fierce attacks on corruption with policies ranging from clean energy to free Internet.

Grillo's surge in the final weeks of the campaign threw the race open, with hundreds of thousands turning up at his rallies to hear him lay into targets ranging from corrupt politicians and bankers to German Chancellor Angela Merkel.

In just three years, his 5-Star Movement, heavily backed by a frustrated generation of young Italians increasingly shut out from permanent full-time jobs, has grown from a marginal group to one of the most talked about political forces in Europe.


"It's a classic result. Typically Italian," said Roberta Federica, a 36-year-old office worker in Rome. "It means the country is not united. It is an expression of a country that does not work. I knew this would happen."

Italy's borrowing costs have come down in recent months, helped by the promise of European Central Bank support but the election result confirmed fears of many European countries that it would not produce a government strong enough to implement effective reforms.

A long recession and growing disillusionment with mainstream parties fed a bitter public mood that saw more than half of Italian voters back parties that rejected the austerity policies pursued by Monti with the backing of Italy's European partners.

Monti suffered a major setback. His centrist grouping won only 10.6 percent and two of his key centrist allies, Pier Ferdinando Casini and lower house speaker Gianfranco Fini, both of parliamentarians for decades, were booted out.

"It's not that surprising if you consider how much people were let down by politics in its traditional forms," Monti said.

Berlusconi's campaign, mixing sweeping tax cut pledges with relentless attacks on Monti and Merkel, echoed many of the themes pushed by Grillo and underlined the increasingly angry mood of the Italian electorate.

Even if the next government turns away from the tax hikes and spending cuts brought in by Monti, it will struggle to revive an economy that has scarcely grown in two decades.

Monti was widely credited with tightening Italy's public finances and restoring its international credibility after the scandal-plagued Berlusconi, who is currently on trial for having sex with an under-age prostitute.

But Monti struggled to pass the kind of structural reforms needed to improve competitiveness and lay the foundations for a return to economic growth, and a weak center-left government may not find it any easier.

(Additional reporting by Barry Moody, Gavin Jones, Catherine Hornby, Lisa Jucca, Steven Jewkes, Steve Scherer and Naomi O'Leary; Writing by Philip Pullella; Editing by Alastair Macdonald)

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South Africa's Pistorius awarded bail in murder case

PRETORIA (Reuters) - Star South African athlete Oscar Pistorius was awarded bail on Friday after being accused of murdering his girlfriend.

The decision by Magistrate Desmond Nair drew cheers from Pistorius' family and supporters at the Pretoria magistrate's court, although the athlete appeared unmoved as the decision was read out.

The decision followed a week of dramatic testimony about how the athlete shot dead his girlfriend Reeva Steenkamp at his luxury home near Pretoria in the early hours of February 14, Valentine's Day.

Prosecutors said Pistorius, 26, committed premeditated murder when he fired four shots into a locked bathroom door, hitting his girlfriend cowering on the other side. Steenkamp, 29, suffered gunshot wounds to her head, hip and arm.

Pistorius' defense team argued the killing was a tragic mistake, saying the athlete had mistaken Steenkamp for an intruder. They said he was too famous to pose a flight risk and deserved bail to prepare for a case that has drawn worldwide attention.

The full trial is unlikely to start for several months. Olympic and Paralympic star Pistorius, a double amputee who ran races on carbon fiber blades, faces life in prison if convicted of murder.

The shooting and allegations that have emerged at the bail hearing have stunned the millions around the world who saw his track glory as an inspiring tale of triumph over adversity.

(Reporting by Peroshni Govender; writing by David Dolan; Editing by Andrew Roche)

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Cameroon, Nigeria officials deny French hostages freed

YAOUNDE (Reuters) - The fate of seven French tourists seized in Cameroon by suspected Nigerian Islamist militants was unclear on Thursday after government officials denied French media reports that they had been freed.

The hostages, four children and three adults, were captured this week while on an excursion to the Waza national park near Cameroon's border with Nigeria.

Several French media reported earlier on Thursday that the hostages had been found alive in a house in northern Nigeria and freed.

"The hostages are safe and sound and are in the hands of Nigerian authorities," BFMTV quoted a Cameroon army officer as saying.

"This is a crazy rumor that we cannot confirm. We do not know where is it coming from," Cameroon Communications Minister Issa Tchiroma Bakary said by telephone from the capital Yaounde.

Sagir Musa, a spokesman for Nigeria's military, told Reuters the report was "not true."

Kader Arif, France's minister for veterans' affairs, told parliament on Thursday that the seven hostages had been released but retracted his statement minutes later, saying he had been quoting media reports and there was no official confirmation.

It was the first case of foreigners being seized by suspected Islamist militants in the mainly Muslim north of Cameroon, a former French colony.

The region is seen as being within the operational sphere of Nigerian sect Boko Haram and another Islamist militant group, Ansaru.

The threat to French nationals in the region has grown since France deployed thousands of troops to nearby Mali to root out al Qaeda-linked Islamists who took control of the country's north last year.

The kidnapping in Cameroon brought to 15 the number of French citizens being held in West Africa.

French diplomatic sources said the government would not confirm the hostages had been released until it had physical proof, or until they were in French hands.

(Reporting By Emile Picy and Nicholas Vinocur in Paris; Additional reporting by Joe Brock in Abuja and Bate Felix and John Irish in Dakar; Editing by Pravin Char and Tom Pfeiffer)

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Bulgarian government resigns amid growing protests

SOFIA (Reuters) - Bulgaria's government resigned on Wednesday after violent nationwide protests against high power prices, joining a long list of European administrations felled by austerity during Europe's debt crisis.

Prime Minister Boiko Borisov, a former bodyguard who swept to power in 2009 on pledges to root out corruption and raise living standards in the European Union's poorest member, now faces a tough task to prop up eroding support ahead of a probable early election.

Wage and pension freezes and tax hikes have bitten deep in a country where living standards are less than half the EU average and tens of thousands of Bulgarians have rallied in protests that have turned violent, chanting "Mafia" and "Resign".

On Tuesday, 11 people were hospitalized - including one man bleeding heavily from the head - and 11 arrested after protesters threw flares at police, who fought demonstrators with shields and truncheons.

"I will not participate in a government under which police are beating people," Borisov, who began his career guarding the Black Sea state's communist dictator Todor Zhivkov, said as he announced his resignation on Wednesday.

Parliament is expected to accept the resignation later in the day.

The spark for the protests was high electricity bills, after the government raised prices by 13 percent last July. But it quickly spilled over into wider frustration with Borisov's domineering manner and unpredictable decision making.

The prime minister made sacrifices in an attempt to cling on, sacking his finance minister, cutting power prices and risking a diplomatic row with the Czech Republic by punishing foreign-owned companies, a move that conflicted with EU norms on protection of investors and due process.

Borisov's rightist GERB party is the dominant faction in parliament but will not take part in talks to form a new government, Interior Minister Tsvetan Tsvetanov said, indicating that an election planned for July will now be held early.

"He made my day," student Borislav Hadzhiev, 21, in central Sofia said, commenting on Borisov's resignation. "The truth is that we're living in an extremely poor country."


GERB's popularity has held up well and it still leads, just, in the polls, largely because budget cutbacks have been relatively mild compared with those in many other European countries. Salaries and pensions were frozen rather than cut.

But the last opinion poll, taken before protests grew last weekend already showed the opposition Socialists were nearly tied with the ruling party and analysts said the protests had boosted the Socialists' chances.

Unemployment in the country of 7.3 million is far from the highs hit in the decade after the end of communism but remains at 11.9 percent and average salaries are stuck at around 800 levs ($550) a month.

Millions have emigrated in search of a better life, leaving swathes of the country depopulated and little hope for those who remain.

The measures announced this week has also put the country on a collision course with the EU and financial investors without easing the tension at home.

Czech Prime Minister Petr Necas demanded an explanation from Bulgaria and accused it of "politicizing" the power sector by threatening to revoke the electricity distribution license of central Europe's largest listed company CEZ, 70 percent of which is owned by the Czech state.

There have also been fines for another Czech company, Energo-Pro and Austria's EVN.

The precedent is unlikely to encourage other foreign investors, who already have to navigate complicated bureaucracy and widespread corruption and organized crime if they want to take advantage of Bulgaria's 16-percent flat tax rate.

"The resignation is the only responsible move," said Kantcho Stoychev, an analyst with pollster Gallup International. "It also gives Borisov some legitimacy to stay in political life in the future, despite the violent police actions last night."

(Additional reporting by Angel Krasimirov; editing by Patrick Graham)

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Venezuela's Maduro would win if Chavez goes: poll

CARACAS (Reuters) - Venezuelan Vice President Nicolas Maduro would comfortably win a presidential election should his boss Hugo Chavez's cancer force him out of power, according to an opinion poll.

The first survey on such a scenario, by local pollster Hinterlaces, gave Maduro a potential 50 percent of votes, compared to 36 percent for opposition leader Henrique Capriles.

Chavez returned to Venezuela on Monday after a long stay in Cuba to continue treatment at home for the disease that is jeopardizing his 14-year socialist rule of the South American OPEC nation.

He has named 50-year-old former bus driver and union activist Maduro as his preferred successor. But Capriles, 40, a center-left state governor who lost to Chavez in a presidential vote last year, would likely run again.

Chavez still has not said a word in public since his December 11 operation in Cuba, and Venezuelans were debating on Tuesday the various possible scenarios after his homecoming - from full recovery, to resignation, or even death from the cancer.

Should Chavez be forced out, Venezuela's constitution stipulates an election must be held within 30 days.

Capriles, who crossed swords with Hinterlaces at various points during the presidential election, again mocked its director, Oscar Schemel, as being biased against him.

"That man is not a pollster, he's on the government's payroll," Capriles told local TV.

"He said in December I would lose the Miranda governorship," he added, referring to his defeat of government heavyweight Elias Jaua, now foreign minister, in that local race.

Opinion surveys are notoriously controversial and divergent in Venezuela, with both sides routinely accusing pollsters of being in the pocket of the other.

Hinterlaces surveyed 1,230 people between January 30-February 9.

(Editing by Bill Trott)

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Time to refer Syrian war crimes to ICC, UN inquiry says

GENEVA (Reuters) - United Nations investigators said on Monday that Syrian leaders they had identified as suspected war criminals should face the International Criminal Court (ICC).

The investigators urged the U.N. Security Council to "act urgently to ensure accountability" for violations, including murder and torture, committed by both sides in a conflict that has killed an estimated 70,000 people since a revolt against President Bashar al-Assad began in March, 2011.

"Now really it's time...We have a permanent court, the International Criminal Court, who would be ready to take this case," Carla del Ponte, a former ICC chief prosecutor who joined the U.N. team in September, told a news briefing in Geneva.

The inquiry, led by Brazilian Paulo Pinheiro, is tracing the chain of command to establish criminal responsibility.

"Of course we were able to identify high-level perpetrators," del Ponte said, adding that these were people "in command responsibility...deciding, organizing, planning and aiding and abetting the commission of crimes".

She said it was urgent for the Hague-based war crimes tribunal to take up cases of very high officials, but did not identify them, in line with the inquiry's practice.

Del Ponte, who brought former Yugoslav President Slobodan Milosevic to the ICC on war crimes charges, said the ICC prosecutor would need to deepen the investigation on Syria before an indictment could be prepared.

Pinheiro, noting that the Security Council would have to refer Syria's case to the ICC, said: "We are in very close dialogue with all the five permanent members and with all the members of the Security Council, but we don't have the key that will open the path to cooperation inside the Security Council."

Karen Konig AbuZayd, an American member of the U.N. team, told Reuters it had information pointing to "people who have given instructions and are responsible for government policy, people who are in the leadership of the military, for example".

The inquiry's third list of suspects, building on lists drawn up in the past year, remains secret. It will be entrusted to U.N. High Commissioner for Human Rights, Navi Pillay, upon expiry of its mandate at the end of March, the report said.

Pinheiro said the investigators would not speak publicly about "numbers, names or levels" of suspects, adding that it was vital to pursue accountability for international crimes "to counter the pervasive sense of impunity" in Syria.


The investigators' latest report, covering the six months to mid-January, was based on 445 interviews conducted abroad with victims and witnesses, as they have not been allowed into Syria.

"The ICC is the appropriate institution for the fight against impunity in Syria. As an established, broadly supported structure, it could immediately initiate investigations against authors of serious crimes in Syria," the 131-page report said.

Pillay, a former ICC judge, said on Saturday Assad should be probed for war crimes, and called for outside action on Syria, including possible military intervention.

Government forces have carried out shelling and air strikes across Syria including Aleppo, Damascus, Deraa, Homs and Idlib, the U.N. report said, citing corroborating satellite images.

"In some incidents, such as in the assault on Harak, indiscriminate shelling was followed by ground operations during which government forces perpetrated mass killing," it said, referring to a town in the southern province of Deraa where residents told them that 500 civilians were killed in August.

"Government forces and affiliated militias have committed extra-judicial executions, breaching international human rights law. This conduct also constitutes the war crime of murder. Where murder was committed as part of a widespread or systematic attack against a civilian population, with knowledge of that attack, it is a crime against humanity," the U.N. report said.

Those forces have targeted bakery queues and funeral processions to spread "terror among the civilian population".

"Syrian armed forces have implemented a strategy that uses shelling and sniper fire to kill, maim, wound and terrorize the civilian inhabitants of areas that have fallen under anti-government armed group control," the report said.

Government forces had used cluster bombs, it said, but it found no credible evidence of either side using chemical arms.

Rebels fighting to topple Assad have also committed war crimes including murder, torture, hostage-taking and using children under age 15 in hostilities, the U.N. report said.

"They continue to endanger the civilian population by positioning military objectives inside civilian areas" and rebel snipers had caused "considerable civilian casualties", it said.

"The violations and abuses committed by anti-government armed groups did not, however, reach the intensity and scale of those committed by government forces and affiliated militia."

Foreign fighters, many of them from Libya, Tunisia, Saudi Arabia, Lebanon, Iraq and Egypt, have radicalized the rebels and helped detonate deadly improvised explosive devices, it said.

(Reporting by Stephanie Nebehay; Editing by Alistair Lyon)

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Pope, nearing retirement, says pray "for me and next pope"

VATICAN CITY (Reuters) - Pope Benedict asked the faithful to pray for him and for the next pope, addressing a crowded St. Peter's Square in his penultimate Sunday address before becoming the first pontiff in centuries to resign.

The crowd chanted "Long live the pope!," waved banners and broke into sustained applause as he spoke from his window. The 85-year-old Benedict, who will resign on February 28, thanked them in several languages.

Speaking in Spanish, he told the crowd which the Vatican said numbered more than 50,000: "I beg you to continue praying for me and for the next pope".

It was not clear why the pope chose Spanish to make the only specific reference to his upcoming resignation in his Sunday address.

A number of cardinals have said they would be open to the possibility of a pope from the developing world, be it Latin America, Africa or Asia, as opposed to another from Europe, where the Church is crisis and polarized.

After his address, the pope retired into the Vatican's Apostolic Palace for a scheduled, week-long spiritual retreat and will not make any more public appearances until next Sunday.

Speaking in Italian in part of his address about Lent, the period when Christians reflect on their failings and seek guidance in prayer, the pope spoke of the difficulty of making important decisions.

"In decisive moments of life, or, on closer inspection, at every moment in life, we are at a crossroads: do we want to follow the ‘I' or God? The individual interest or the real good, that which is really good?" he said.


Since his shock announcement last Monday, the pope has said several times that he made the difficult decision to become the first pope in more than six centuries to resign for the good of the Church.

"In a funny way he is even more peaceful now with this decision, unlike the rest of us, he is not somebody who gets choked up really easily," said Greg Burke, a senior media advisor to the Vatican.

"I think that has a lot to do with his spiritual life and who he is and the fact he is such a prayerful man," Burke told Reuters Television.

The pope has said his physical and spiritual forces are no longer strong enough to sustain him in the job of leading the world's 1.2 billion Roman Catholics at a time of difficulties for the Church in a fast-changing world.

Benedict's papacy was rocked by crises over the sex abuse of children by priests in Europe and the United States, most of which preceded his time in office but came to light during it.

His reign also saw Muslim anger after he compared Islam to violence. Jews were upset over his rehabilitation of a Holocaust denier. During a scandal over the Church's business dealings, his butler was convicted of leaking his private papers.

People in the crowd said the pope was a shadow of the man he was when elected on April 19, 2005.

"Like always, recently, he seemed tired, moved, perplexed, uncertain and insecure," said Stefan Malabar, an Italian in St. Peter's Square.

"It's something that really has an effect on you because the pope should be a strong and authoritative figure but instead he seems very weak, and that really struck me," he said.

The Vatican has said the conclave to choose his successor could start earlier than originally expected, giving the Roman Catholic Church a new leader by mid-March.

Some 117 cardinals under the age of 80 will be eligible to enter the secretive conclave to elect Benedict's successor. Church rules say the conclave has to start between 15 and 20 days after the papacy becomes vacant, which it will on February 28.

But since the Church is now dealing with an announced resignation and not a sudden death, Vatican spokesman Federico Lombardi said the Vatican would be "interpreting" the law to see if it could start earlier.


Cardinals around the world have already begun informal consultations by phone and email to construct a profile of the man they think would be best suited to lead the Church in a period of continuing crisis.

The Vatican appears to be aiming to have a new pope elected and then formally installed before Palm Sunday on March 24 so he can preside at Holy Week services leading to Easter.

New details emerged at the weekend about the state of Benedict's health in the months before his shock decision.

Peter Seewald, a German journalist who wrote a book with the pope in 2010 in which Benedict first floated the possibility of resigning, visited him again about 10 weeks ago and asked what else could be expected from his papacy.

According to excepts published in the German magazine Focus, the pope answered: "From me? Not much from me. I'm an old man and the strength is ebbing. I think what I've done is enough."

Asked if he was considering resigning, the pope said: "That depends on how much my physical strength will force me to that".

Seewald said he was alarmed about the pope's health.

"His hearing had deteriorated. He couldn't see with his left eye. His body had become so thin that the tailors had difficulty in keeping up with newly fitted clothes ... I'd never seen him so exhausted-looking, so worn down."

The pope will say one more Sunday noon prayer on February 24, hold a final general audience on February 27. The next day he will take a helicopter to the papal summer retreat at Castle Gandalf, south of Rome, flying into the history books.

Vatican officials said he would stay there for the two months or so needed to restore the convent inside the Vatican where he will live out his remaining years.

(Additional reporting by Hanna Rantala; Editing by Robin Pomeroy)

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Exclusive: North Korea tells China of preparations for fresh nuclear test - source

BEIJING (Reuters) - North Korea has told its key ally, China, that it is prepared to stage one or even two more nuclear tests this year in an effort to force the United States into diplomatic talks, said a source with direct knowledge of the message.

Further tests could also be accompanied this year by another rocket launch, said the source, who has direct access to the top levels of government in both Beijing and Pyongyang.

North Korea conducted its third nuclear test on Tuesday, drawing global condemnation and a stern warning from the United States that it was a threat and a provocation.

"It's all ready. A fourth and fifth nuclear test and a rocket launch could be conducted soon, possibly this year," the source said, adding that the fourth nuclear test would be much larger than the third, at an equivalent of 10 kilotons of TNT.

The tests will be undertaken, the source said, unless Washington holds talks with North Korea and abandons its policy of what Pyongyang sees as attempts at regime change.

North Korea also reiterated its long-standing desire for the United States to sign a final peace agreement with it and establish diplomatic relations, he said. North Korea remains technically at war with both the United States and South Korea after the Korean war ended in 1953 with a truce.

In Washington, U.S. State Department spokeswoman Victoria Nuland urged North Korea to "refrain from additional provocative actions that would violate its international obligations" under three different sets of U.N. Security Council resolutions that prohibit nuclear and missile tests.

North Korea "is not going to achieve anything in terms of the health, welfare, safety, future of its own people by these kinds of continued provocative actions. It's just going to lead to more isolation," Nuland told reporters.

The Pentagon also weighed in, calling North Korea's missile and nuclear programs "a threat to U.S. national security and to international peace and security."

"The United States remains vigilant in the face of North Korean provocations and steadfast in our defense commitments to allies in the region," said Pentagon spokeswoman Major Catherine Wilkinson.

Initial estimates of this week's test from South Korea's military put its yield at the equivalent of 6-7 kilotons, although a final assessment of yield and what material was used in the explosion may be weeks away.

North Korea's latest test, its third since 2006, prompted warnings from Washington and others that more sanctions would be imposed on the isolated state. The U.N. Security Council has only just tightened sanctions on Pyongyang after it launched a long-range rocket in December.

Pyongyang is banned under U.N. sanctions from developing missile or nuclear technology after its 2006 and 2009 nuclear tests.

North Korea worked to ready its nuclear test site, about 100 km (60 miles) from its border with China, throughout last year, according to commercially available satellite imagery. The images show that it may have already prepared for at least one more test, beyond Tuesday's subterranean explosion.

"Based on satellite imagery that showed there were the same activities in two tunnels, they have one tunnel left after the latest test," said Kune Y. Suh, a nuclear engineering professor at Seoul National University in South Korea.

Analysis of satellite imagery released on Friday by specialist North Korea website 38North showed activity at a rocket site that appeared to indicate it was being prepared for a launch (


President Barack Obama pledged after this week's nuclear test "to lead the world in taking firm action in response to these threats" and diplomats at the U.N. Security Council have already started discussing potential new sanctions.

North Korea has said the test was a reaction to "U.S. hostility" following its December rocket launch. Critics say the rocket launch was aimed at developing technology for an intercontinental ballistic missile.

"(North) Korea is not afraid of (further) sanctions," the source said. "It is confident agricultural and economic reforms will boost grain harvests this year, reducing its food reliance on China."

North Korea's isolated and small economy has few links with the outside world apart from China, its major trading partner and sole influential diplomatic ally.

China signed up for international sanctions against North Korea after the 2006 and 2009 nuclear tests and for a U.N. Security Council resolution passed in January to condemn the latest rocket launch. However, Beijing has stopped short of abandoning all support for Pyongyang.

Sanctions have so far not discouraged North Korea from pursuing its nuclear ambitions.

"It is like watching the same movie over and over again," said Lee Woo-young, a professor at Seoul's University of North Korean Studies. "The idea that stronger sanctions make North Korea stop developing nuclear programs isn't effective in my view."

The source with ties to Beijing and Pyongyang said China would again support U.N. sanctions. He declined to comment on what level of sanctions Beijing would be willing to endorse.

"When China supported U.N. sanctions ... (North) Korea angrily called China a puppet of the United States," he said. "There will be new sanctions which will be harsh. China is likely to agree to it," he said, without elaborating.

He said however that Beijing would not cut food and fuel supplies to North Korea, a measure it reportedly took after a previous nuclear test.

He said North Korea's actions were a distraction for China's leadership, which was concerned that the escalations could inflame public opinion in China and hasten military build-ups in the region.

The source said he saw little room for compromise under North Korea's youthful new leader, Kim Jong-un. The third Kim to rule North Korea is just 30 years old and took over from his father in December 2011.

He appears to have followed his father, Kim Jong-il, in the "military first" strategy that has pushed North Korea ever closer to a workable nuclear missile at the expense of economic development.

"He is much tougher than his father," the source said.

(Additional reporting by Arshad Mohammed and Phillip Stewart in WASHINGTON; Writing by David Chance; Editing by Raju Gopalakrishnan, David Brunnstrom and Jackie Frank)

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Meteorite hits central Russia, more than 500 people hurt

CHELYABINSK, Russia (Reuters) - More than 500 people were injured when a meteorite shot across the sky and exploded over central Russia on Friday, sending fireballs crashing to Earth, shattering windows and damaging buildings.

People heading to work in Chelyabinsk heard what sounded like an explosion, saw a bright light and then felt a shockwave according to a Reuters correspondent in the industrial city 1,500 km (950 miles) east of Moscow.

A fireball blazed across the horizon, leaving a long white trail in its wake which could be seen as far as 200 km (125 miles) away in Yekaterinburg. Car alarms went off, windows shattered and mobile phone networks were interrupted.

"I was driving to work, it was quite dark, but it suddenly became as bright as if it was day," said Viktor Prokofiev, 36, a resident of Yekaterinburg in the Urals Mountains.

"I felt like I was blinded by headlights," he said.

No fatalities were reported but President Vladimir Putin, who was due to host Finance Ministry officials from the Group of 20 nations in Moscow, and Prime Minister Dmitry Medvedev were informed.

A local ministry official said such incidents were extremely rare and Friday's events might have been linked to an asteroid the size of an Olympic swimming pool due to pass Earth at a distance of 27,520 km (17,100 miles) but this was not confirmed.

Russia's space agency Roscosmos said the meteorite was travelling at a speed of 30 km (19 miles) per second and that such events were hard to predict. The Interior Ministry said the meteorite explosion had caused a sonic boom.

Russia's Emergencies Ministry said 514 people had sought medical help, mainly for light injuries caused by flying glass, and that 112 of those were kept in hospital. Search groups were set up to look for the remains of the meteorite.

"There have never been any cases of meteorites breaking up at such a low level over Russia before," said Yuri Burenko, head of the Chelyabinsk branch of the Emergencies Ministry.


Windows were shattered on Chelyabinsk's central Lenin Street and some of the frames of shop fronts buckled.

A loud noise, resembling an explosion, rang out at around 9.20 a.m. (12:20 a.m. ET). The shockwave could be felt in apartment buildings in the industrial city's center.

"I was standing at a bus stop, seeing off my girlfriend," said Andrei, a local resident who did not give his second name. "Then there was a flash and I saw a trail of smoke across the sky and felt a shockwave that smashed windows."

A wall was damaged at the Chelyabinsk Zinc Plant but a spokeswoman said there was no environmental threat.

Although such events are rare, a meteorite is thought to have devastated an area of more than 2,000 sq km (1,250 miles) in Siberia in 1908, smashing windows as far as 200 km (125 miles) from the point of impact.

The Emergencies Ministry described Friday's events as a "meteor shower in the form of fireballs" and said background radiation levels were normal. It urged residents not to panic.

Chelyabinsk city authorities urged people to stay indoors unless they needed to pick up their children from schools and kindergartens. They said what sounded like a blast had been heard at an altitude of 10,000 meters (32,800 feet).

The U.S. space agency NASA has said an asteroid known as 2012 DA14, about 46 meters in diameter, would have an encounter with Earth closer than any asteroid since scientists began routinely monitoring them about 15 years ago.

Television, weather and communications satellites fly about 500 miles higher. The moon is 14 times farther away.

(Additional reporting by Natalia Shurmina in Yekaterinburg and Gabriela Baczynska in Moscow, Writing by Alexei Anishchuk and Timothy Heritage, Editing by Michael Holden)

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"Blade Runner" Pistorius charged with murdering girlfriend

JOHANNESBURG (Reuters) - South African "Blade Runner" Oscar Pistorius, a double amputee who became one of the biggest names in world athletics, was charged on Thursday with shooting dead his girlfriend at his upscale home in Pretoria.

Police said they opened a murder case after a 30-year-old woman was found dead at the Paralympic and Olympic star's house in the Silverlakes gated complex on the capital's outskirts.

Pistorius, 26, and his girlfriend, model Reeva Steenkamp, had been the only people in the house at the time of the shooting, police brigadier Denise Beukes, told reporters, adding witnesses had been interviewed about the early morning incident.

"We are talking about neighbors and people that heard things earlier in the evening and when the shooting took place," Beukes said outside the heavily guarded residential complex. Earlier, police said a 9mm pistol had been found at the scene.

Beukes said police were aware of previous incidents at the Pistorius house. "I can confirm that there has previously been incidents at the home of Mr Oscar Pistorious, of allegations of domestic nature," she said.

Pistorius, who uses carbon fiber prosthetic blades to run, is due to appear in a Pretoria court on Friday.

"He is doing well but very emotional," his lawyer Kenny Oldwage told SABC TV, but gave no further comment.

A sports icon for triumphing over disabilities to compete with able-bodied athletes at the Olympics, his sponsorship deals, including one with sports apparel group Nike, are thought to be worth $2 million a year.

South Africa's M-Net cable TV channel said it was pulling adverts featuring Pistorius off air immediately.


Steenkamp's colleagues in the modeling world were distraught. "We are all devastated. Her family is in shock," her agent, Sarita Tomlinson, tearfully told Reuters. "They did have a good relationship. Nobody actually knows what happened."

Pistorius, who was born without a fibula in both legs, was the first double amputee to run in the Olympics and reached the 400-metre semi-finals in London 2012.

In last year's Paralympics he suffered his first loss over 200 meters in nine years. After the race he questioned the legitimacy of Brazilian winner Alan Oliveira's prosthetic blades, though he was quick to express regret for the comments.

South Africa has some of the world's highest rates of violent crime, and many home owners have weapons to defend themselves against intruders, although Pistorius' complex is surrounded by a three-meter high wall and electric fence.

In 2004, Springbok rugby player Rudi Visagie shot dead his 19-year-old daughter after he mistakenly thought she was a robber trying to steal his car in the middle of the night.

Before the murder charge was announced, Johannesburg's Talk Radio 702 said the athlete may have mistaken Steenkamp for a burglar.

Recent media interviews with Pistorius revealed he kept an assortment of weapons in his home.

"Cricket and baseball bats lay behind the door, a pistol by his bed and a machine gun by a window," Britain's Daily Mail wrote in a profile published last year.

Pistorius was arrested in 2009 for assault after slamming a door on a woman and spent a night in police custody. Family and friends said it was just an accident and charges were dropped.

"He's very quiet and very modest but he's a big party animal," one of South Africa's top runners, who knows Pistorius, told Reuters. "I've been with him when we've been smashed and he never seemed violent," said the runner, who declined to be named.


Steenkamp, a regular on the South African social scene, was reported to have been dating Pistorius for several months.

In the social pages of last weekend's Sunday Independent she described him as having "impeccable" taste. "His gifts are always thoughtful," she was quoted as saying.

Some of her last Twitter postings indicated she was looking forward to Valentine's Day on Thursday. "What do you have up your sleeve for your love tomorrow???" she posted.

Pistorius was on Thursday being processed through the police system. "At this stage he is on his way to a district surgeon for medical examination," the police brigadier said.

"When a person has been accused of a crime like murder they look at things like testing under the finger nails, taking a blood alcohol sample and all kinds of other test that are done. They are standard medical tests," Beukes said.

Pistorius is also sponsored by British telecoms firm BT, sunglasses maker Oakley and French designer Thierry Mugler.

"We are shocked by this terrible, tragic news. We await the outcome of the South African police investigation," a BT spokeswoman said before Pistorius was charged.

A Nike spokesman in London said before hearing of the murder charge that the company was "saddened by the news, but we have no further comment to make at this stage".

Pistorius also has a sponsorship deal with Icelandic prosthetics manufacturer Ossur.

"I can only say that our thoughts and prayers are with Oscar and the families involved in the tragedy," Ossur CEO Jon Sigurdsson told Reuters. "It is completely premature to discuss or speculate on our business relationship with him."

Neighbors expressed shock at the arrest of a "good guy".

"It is difficult to imagine an intruder entering this community, but we live in a country where intruders can get in wherever they want to," said one Silverlakes resident, who did not want to be named.

"Oscar is a good guy, an upstanding neighbor, and if he is innocent I feel for this guy deeply," he said.

(Additional reporting by Sherilee Lakmidas, David Dolan, Ed Cropley, Jon Herskovitz, Keith Weir and Kate Holton; Writing by Ed Cropley; Editing by Will Waterman and Peter Millership)

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Insight: Divided Damascus confronted by all-out war

DAMASCUS (Reuters) - MiG warplanes roar low overhead to strike rebels fighting to oust President Bashar al-Assad on the fringes of Damascus, while artillery batteries pound the insurgents from hills overlooking a city divided between all-out war and a deceptive calm.

Whole families can be obliterated by air raids that miss their targets. Wealthy Syrians or their children are kidnapped. Some are returned but people tell grim tales of how others are tortured and dumped even when the ransom is paid.

People also tell of prisoners dying under torture or from infected wounds; of looting by the government's feared shabbiha militias or by rebels fighting to throw out the Assad family.

That is one Damascus. In the other, comprising the central districts of a capital said to be the oldest continually inhabited city in the world, the restaurant menus are full, the wine is cheap and the souks are packed with shoppers.

Employees report for work, children go to school and shops are open, seemingly undeterred by the din and thud of war.

The two cities exist a few miles apart - for now.

For Damascus and its outskirts are rapidly descending into civil war and everything that comes with it - lawlessness, looting, kidnapping and revenge killings. Like the rest of the country, the capital and its suburbs are crawling with armed gangs.

"Anybody can come to you pretending he is security and grab you in broad daylight, put you in a car and speed off and nobody dares interfere or rescue you," says Lama Zayyat, 42. "A girl in the 7th grade was kidnapped and her father was asked to pay a big ransom. The same happened to other children," she said.

Nobody really knows who is behind the kidnappings. In one gang, one brother is in charge of abductions while another brother negotiates with the victims. The fear is palpable.


The war has not yet reached the heart of the capital, but it is shredding the suburbs. In the past week, government troops backed by air power unleashed fierce barrages on the east of the city in an attempt to flush out rebel groups.

Most of central Damascus is controlled by Assad's forces, who have erected checkpoints to stop bomb attacks. The insurgents have so far failed to take territory in the center.

Just as loyalist forces seem unable to regain control of the country, there looks to be little chance the rebels can storm the center of Damascus and attack the seat of Assad's power.

For most of last week the army rained shells on the eastern and southern neighborhoods of Douma, Jobar, Zamalka and Hajar al-Aswad, using units of the elite Republican Guard based on the imposing Qasioun mountain that looms over the city.

The rebels, trying to break through the government's defense perimeter, were periodically able to overrun roadblocks and some army positions, but at heavy cost.

Jobar and Zamalka are situated near military compounds housing Assad's forces, while Hajar al-Aswad in the south is one of the gateways into the city, close to Assad's home and the headquarters of his republican guard and army.

Since the uprising began two years ago, 70,000 people have been killed, 700,000 have been driven from Syria and millions more are displaced, homeless and hungry. No section of society has been spared, whether Christians, Alawites or Sunnis, but in every community it is the poor who are suffering most.

Electricity is sporadic. Hospitals are understaffed as so many doctors - often targeted on suspicion of treating rebel wounded - have fled. Hotels and businesses barely function.

Outside petrol stations and bakeries, queues are long and supplies often run out, meaning people have to come back the next day. Those who can afford it pay double on a thriving black market.

The scale of the suffering can be seen in the ubiquitous obituary notices on the walls of Damascus streets - some announcing the deaths of whole families killed by shelling.

As if oblivious of these private daily tragedies, the government insists the situation is under control, while the rebels say the Assads' days are numbered.


Ordinary Syrians are convinced their ordeal is nowhere near over. While they believe Assad will not be able to reverse the gains of the rebels, they cannot see his enemies prevailing over his superior firepower, and Russian and Iranian support.

"The regime won't be able to crush the revolution and the rebels won't be able to bring down the regime," said leading opposition figure Hassan Abdel-Azim. "The continuation of violence won't lead to the downfall of the regime, it will lead to the seizure of the country by armed gangs, which will pose a grave danger not only to Syria but to our neighbors".

"Right now no one is capable of winning," said a Damascus-based senior Arab envoy. "The crisis will continue if there is no political process. It is deadlock."

Other diplomats in Damascus say the United States and its allies are getting cold feet about arming the rebels, fearing the growing influence of Islamist radicals such the al-Nusra Front linked to al-Qaeda, banned last year by Washington.

Some remarks recur again and again in Damascus conversations: "Maybe he will stay in power, after all", and, above all, "Who is the alternative to Assad?"

"At first I thought it was a matter of months. That's why I came here and stayed to bear witness to the final moments," said Rana Mardam Beik, a Syrian-American writer. "But it looks like it will be a while so I am thinking of going back to the U.S."

Loyalty to Assad is partly fed by fear of the alternative. Facing a Sunni-dominated revolt, Syria's minorities, including Christians and Assad's own Alawites - an offshoot of Shi'ite Islam - fear they will slaughtered or sidelined if the revolution succeeds and Sunni fundamentalists come to power.


Many Christians are already trying to emigrate to countries such as Sweden, diplomats say.

"The minorities have every right to be frightened because no one knows what is the alternative. Is it a liberal, civic, pluralistic and democratic state, or is the alternative an Islamist extremist rule that considers the minorities infidels and heretics?" said Abdel Azim.

The government tells the minorities the only alternative to Assad is Islamism. Loyalist brutality against the Sunni majority is in danger of making this a self-fulfilling prophecy, by sucking in jihadi extremists from Libya to Saudi Arabia.

"I am not with the regime but we are sure that if Bashar goes the first people they will come for are the Alawites, then the Shi'ites and then us Christians. They are fanatics," said George Husheir, 50, an IT engineer.

At the Saint Joseph Church in Bab Touma, the old Christian quarter of Damascus, Christians in their dozens, mostly middle-aged and older couples, gathered for mass on a Friday morning.

"We don't know what the future holds for us and for this country," said the priest in his sermon. "The Christians of Syria need to pray more."

Nabiha, a dentist in her 40s, said: "Bashar is a Muslim president but he is not a fanatic. He gave us everything. Why shouldn't we love him. Look at us here in our church, we pray, we mark our religious rituals freely, we do what we like and nobody interferes with us."

The fear of the Christians extends to the Alawite and minority Shi'ites. "If Bashar goes we definitely have to leave too because the Sufianis (Sunni Salafis) are coming and they are filled with a sectarian revenge against us," said one wealthy middle class Shi'ite.


Alongside sectarian hatreds, class and tribal acrimony is also surfacing. Wealthy Sunnis in the capital are already in a panic about poor Sunni Islamists from rural areas descending on their neighborhoods.

"When they come they will eat us alive", one rich Sunni resident of Damascus said, repeating what a cab driver dropping him in the posh Abou Roummaneh district told him: "Looting these houses will be allowed."

Yet many activists feel protective of the revolution, despite the brutal behavior of some Islamist rebels.

"People talk about chaos and anarchy after Assad, but so what if we have two years of a messy transition? That is better than to endure another 30 years of this rule," said Rana Darwaza, 40, a Sunni academic in Damascus.

Prominent human rights lawyer Anwar al-Bunni said the suffering is a price that had to be paid. "Those on the ground will continue to fight even with their bare hands", he said.

He said there are thousands of prisoners in horrific conditions in Assad's jails. Some suffocate in overcrowded cells while others die under torture or from untreated wounds. "They don't give them medical treatment or pain killers or antibiotics. They leave them to die," he said.

Close watchers of Syria predict that if there is no settlement in a few months the conflict could go on for years. Yet the economy is collapsing, leaving the government to rely on dwindling foreign reserves, private assets and Iranian funds.

There is no tourism, no oil revenue, and 70 percent of businesses have left Syria, said analyst Nabil Samman. "We are heading for destruction, the future is dark", he added.

Added to the religious animosity between the Sunni majority and the Alawite minority who took control when Hafez al-Assad seized power in 1970 are social and economic grievances fuelled by the predatory practices of the elite.

This resentment extends to young middle class Syrians who feel they have lost a way of life and that their country is being used by regional powers for proxy war.

"All the regional point-scoring is taking place in Syria. We have Libyan fighters and Saudis fighting for freedom in Syria, why are they here? Let them go and demand freedom in their own countries?," said banker Hani Hamaui, 29.

Two years into the uprising, Assad is hanging on. Some will always back him and others want him dead. But many just want an end to the fighting. They may have to wait for some time.

Signs daubed on the gates to the city by Assad's troops are a reminder that the battle for Damascus will be costly. "Either Assad, or we will set the country ablaze", they say.

(Editing by Giles Elgood)

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China joins U.S., Japan in condemning North Korea nuclear test

SEOUL (Reuters) - North Korea conducted its third nuclear test on Tuesday in defiance of existing U.N. resolutions, drawing condemnation from around the world, including from its only major ally, China, which summoned the North Korean ambassador to protest.

The reclusive North said the test was an act of self-defense against "U.S. hostility" and threatened further, stronger steps if necessary.

It said the test had "greater explosive force" than the 2006 and 2009 tests. Its KCNA news agency said it had used a "miniaturized" and lighter nuclear device, indicating that it had again used plutonium which is more suitable for use as a missile warhead.

North Korean leader Kim Jong-un, the third of his line to rule the country, has presided over two long-range rocket launches and a nuclear test during his first year in power, pursuing policies that have propelled his impoverished and malnourished country closer to becoming a nuclear weapons power.

China, which has shown signs of increasing exasperation with the recent bellicose tone of its neighbor, summoned the North Korean ambassador in Beijing and protested sternly, the Foreign Ministry said.

Foreign Minister Yang Jiechi said China was "strongly dissatisfied and resolutely opposed" to the test and urged North Korea to "stop any rhetoric or acts that could worsen situations and return to the right course of dialogue and consultation as soon as possible".

China is a permanent member of the Security Council.

U.S. President Barack Obama labeled the test a "highly provocative act" that hurt regional stability and pressed for new sanctions.

"The danger posed by North Korea's threatening activities warrants further swift and credible action by the international community. The United States will also continue to take steps necessary to defend ourselves and our allies," Obama said in a statement.

The Security Council will meet on Tuesday to discuss its reaction to the test, although North Korea is already one of the most heavily sanctioned states in the world and has few external economic links that can be targeted.

Japanese Prime Minister Shinzo Abe said the test was a "grave threat" that could not be tolerated. U.N. Secretary-General Ban Ki-moon said the test was a "clear and grave violation" of U.N. Security Council resolutions.

Russian Foreign Minister Sergei Lavrov urged North Korea to abandon its nuclear arms program and return to talks. NATO condemned the test as an "irresponsible act" that posed a grave threat to world peace.

The test "was only the first response we took with maximum restraint", an unnamed spokesman for the North Korean Foreign Ministry, which acts as Pyongyang's official voice to the outside world, said in a statement carried by the official KCNA news agency.

"If the United States continues to come out with hostility and complicates the situation, we will be forced to take stronger, second and third responses in consecutive steps."

North Korea often threatens the United States and its "puppet", South Korea, with destruction in colorful terms.

North Korea told the U.N. disarmament forum in Geneva that it would never bow to resolutions on its nuclear program and that prospects were "gloomy" for the denuclearization of the divided Korean peninsula because of a "hostile" U.S. policy.

South Korea, still technically at war with the North after the 1950-53 civil war ended in a mere truce, also denounced the test.

The magnitude was roughly twice as large as that of 2009, Lassina Zerbo, director of the international data centre division of the Vienna-based Comprehensive Nuclear-Test Ban Treaty Organization, said. The U.S. Geological Survey said that a seismic event measuring 5.1 magnitude had occurred.

"It was confirmed that the nuclear test that was carried out at a high level in a safe and perfect manner using a miniaturized and lighter nuclear device with greater explosive force than previously did not pose any negative impact on the surrounding ecological environment," KCNA said.

Despite China's strong response, the test is likely to be a major embarrassment for Beijing, the North's sole major economic and diplomatic ally.

"The test is hugely insulting to China, which now can be expected to follow through with threats to impose sanctions," said Mark Fitzpatrick of the International Institute for Strategic Studies think tank.

North Korea trumpeted the announcement on its state television channel to patriotic music against the backdrop of an image of its national flag.

It linked the test to its technical prowess in launching a long-range rocket in December, a move that triggered the U.N. sanctions, backed by China, that Pyongyang said prompted it to take Tuesday's action.

The North's ultimate aim, Washington believes, is to design an intercontinental ballistic missile capable of carrying a nuclear warhead that could hit the United States. North Korea says the program is aimed merely at putting satellites in space.

North Korea used plutonium in previous nuclear tests and prior to Tuesday there had been speculation it would use highly enriched uranium so as to conserve its plutonium stocks as testing eats into its limited supply of the material that could be used to construct a nuclear bomb.


Despite its three nuclear tests and long-range rocket tests, North Korea is not believed to be close to manufacturing a nuclear missile capable of hitting the United States.

South Korea's Yonhap news agency said Pyongyang had informed China and the United States of its plans to test on Monday, although this could not be confirmed.

When North Korean leader Kim, 30, took power after his father's death in December 2011, there were hopes the he would bring reforms and end Kim Jong-il's "military first" policies.

Instead, the North, whose economy is smaller than it was 20 years ago and where a third of children are believed to be malnourished, appears to be trapped in a cycle of sanctions followed by further provocations.

"The more North Korea shoots missiles, launches satellites or conducts nuclear tests, the more the U.N. Security Council will impose new and more severe sanctions," said Shen Dingli, a professor at Shanghai's Fudan University. "It is an endless, vicious cycle."

But options for the international community appear to be in short supply.

Tuesday's action appeared to have been timed for the run-up to February 16 anniversary celebrations of Kim Jong-il's birthday, as well as to achieved maximum international attention.

Significantly, the test comes at a time of political transition in China, Japan and South Korea, and as Obama begins his second term. He will likely have to tweak his State of the Union address due to be given on Tuesday.

Japanese Prime Minister Shinzo Abe is bedding down a new government and South Korea's new president, Park Geun-hye, prepares to take office on February 25.

China too is in the midst of a once-in-a-decade leadership transition to Xi Jinping, who takes office in March. Both Abe and Xi are staunch nationalists.

The longer-term game plan from Pyongyang may be to restart talks aimed at winning food and financial aid. China urged it to return to the stalled "six-party" talks on its nuclear program, hosted by China and including the two Koreas, the United States, Japan and Russia.

Its puny economy and small diplomatic reach mean the North struggles to win attention on the global stage - other than through nuclear tests and attacks on South Korea, last made in 2010.

"Now the next step for North Korea will be to offer talks... - any form to start up discussion again to bring things to their advantage," said Jeung Young-tae, senior research fellow at the Korea Institute for National Unification in Seoul.

The European Union's foreign policy chief, Catherine Ashton, urged North Korea to refrain from further provocation.

EU member Denmark called on China to step up to the plate and use its influence to rein in its ally.

"This deserves only one thing and that is a one-sided condemnation," said Foreign Minister Villy Sovndal. "North Korea is likely the most horrible country on this planet."

(Additional reporting by Jack Kim, Christine Kim and Jumin Park in SEOUL; Linda Sieg in TOKYO; Louis Charbonneau at the UNITED NATIONS; Fredrik Dahl in VIENNA; Michael Martina and Chen Aizhu in BEIJING; Mette Fraende in COPENHAGEN; Adrian Croft, Charlie Dunmore and Justyna Pawlak in BRUSSELS; Editing by Nick Macfie)

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Pope Benedict stepping down, cites poor health

VATICAN CITY (Reuters) - Pope Benedict shocked the world on Monday by saying he no longer had the mental and physical strength to cope with his ministry, in an announcement that left his aides "incredulous" and will make him the first pontiff to step down since the Middle Ages.

The German-born Pope, 85, hailed as a hero by conservative Roman Catholics and viewed with suspicion by liberals, told cardinals in Latin that his strength had deteriorated recently. He will step down on February 28 and the Vatican expects a new Pope to be chosen by the end of March.

Vatican spokesman Father Federico Lombardi said the Pope had not decided to resign because of "difficulties in the papacy" and the move had been a surprise, indicating that even his inner circle was unaware that he was about to quit.

The Pope does not fear schism in the Church after his resignation, the spokesman said.

The Pope's leadership of 1.2 billion Catholics has been beset by child sexual abuse crises that tarnished the Church, one address in which he upset Muslims and a scandal over the leaking of his private papers by his personal butler.

The pope told the cardinals that in order to govern "...both strength of mind and body are necessary, strength which in the last few months, has deteriorated in me to the extent that I have had to recognize my incapacity to adequately fulfill the ministry entrusted to me.

"For this reason, and well aware of the seriousness of this act, with full freedom I declare that I renounce the ministry of Bishop of Rome, Successor of Saint Peter."

He also referred to "today's world, subject to so many rapid changes and shaken by questions of deep relevance for the life of faith."

The last Pope to resign willingly was Celestine V in 1294 after reigning for only five months, his resignation was known as "the great refusal" and was condemned by the poet Dante in the "Divine Comedy". Gregory XII reluctantly abdicated in 1415 to end a dispute with a rival claimant to the papacy.


Before he was elected Pope, the former Cardinal Joseph Ratzinger was known by such critical epithets as "God's rottweiler" because of his stern stand on theological issues.

But after several years into his new job Benedict showed that he not only did not bite but barely even barked.

In recent months, the pope has looked increasingly frail in public, sometimes being helped to walk by those around him.

Lombardi ruled out depression or uncertainty as being behind the resignation, saying the move was not due to any specific illness, just advancing age.

The Pope had shown "great courage, determination" aware of the "great problems the church faces today", he said, adding the timing may have reflected the Pope's desire to avoid the exhausting rush of Easter engagements.

There was no outside pressure and Benedict took his "personal decision" in the last few months, he added.

Israel's Chief Rabbi praised Benedict's inter-faith outreach and wished him good health. The Archbishop of Canterbury, head of the Anglican Church, said he had learned of the Pope's decision with a heavy heart but complete understanding.

German Chancellor Angela Merkel said the Pope's decision must be respected if he feels he is too weak to carry out his duties. British Prime Minister David Cameron said: "He will be missed as a spiritual leader to millions."

The pontiff would step down from 2 p.m. ET on February 28, leaving the office vacant until a successor was chosen to Benedict who succeeded John Paul, one of history's most popular pontiffs, the spokesman said.

Elected to the papacy on April 19, 2005 when he was 78 - 20 years older than John Paul was when he was elected - Benedict ruled over a slower-paced, more cerebral and less impulsive Vatican.


But while conservatives cheered him for trying to reaffirm traditional Catholic identity, his critics accused him of turning back the clock on reforms by nearly half a century and hurting dialogue with Muslims, Jews and other Christians.

Under the German's meek demeanor lay a steely intellect ready to dissect theological works for their dogmatic purity and debate fiercely against dissenters.

After appearing uncomfortable in the limelight at the start, he began feeling at home with his new job and showed that he intended to be Pope in his way.

Despite great reverence for his charismatic, globe-trotting predecessor -- whom he put on the fast track to sainthood and whom he beatified in 2011 -- aides said he was determined not to change his quiet manner to imitate John Paul's style.

A quiet, professorial type who relaxed by playing the piano, he managed to show the world the gentle side of the man who was the Vatican's chief doctrinal enforcer for nearly a quarter of a century.

The first German pope for some 1,000 years and the second non-Italian in a row, he traveled regularly, making about four foreign trips a year, but never managed to draw the oceanic crowds of his predecessor.

The child abuse scandals hounded most of his papacy. He ordered an official inquiry into abuse in Ireland, which led to the resignation of several bishops.


Scandal from a source much closer to home hit in 2012 when the pontiff's butler, responsible for dressing him and bringing him meals, was found to be the source of leaked documents alleging corruption in the Vatican's business dealings, causing an international furor.

He confronted his own country's past when he visited the Nazi death camp at Auschwitz.

Calling himself "a son of Germany", he prayed and asked why God was silent when 1.5 million victims, most of them Jews, died there during World War Two.

Ratzinger served in the Hitler Youth during World War Two when membership was compulsory. He was never a member of the Nazi party and his family opposed Adolf Hitler's regime.

But his trip to Germany also prompted the first major crisis of his pontificate. In a university lecture he quoted a 14th century Byzantine emperor as saying Islam had only brought evil to the world and that it was spread by the sword.

After protests that included attacks on churches in the Middle East and the killing of a nun in Somalia, the Pope later said he regretted any misunderstanding the speech caused.

In a move that was widely seen as conciliatory, in late 2006 he made a historic trip to predominantly Muslim Turkey and prayed in Istanbul's Blue Mosque with a Turkish Mufti.

But months later, former Iranian President Mohammad Khatami met the Pope and said wounds between Christians and Muslims were still "very deep" as a result of the Regensburg speech.

(Writing by Peter Millership; editing by Janet McBride and Ralph Boulton)

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Netanyahu to discuss Iran, Syria, Palestinians with Obama

JERUSALEM (Reuters) - Iran's nuclear ambitions, the civil war in Syria and stalled Israeli-Palestinian peace efforts will top the agenda of U.S. President Barack Obama's visit to Israel, Prime Minister Benjamin Netanyahu said on Sunday.

"It is a very important visit that will emphasize the strong alliance between Israel and the United States," Netanyahu, who has had a testy relationship with Obama, told his cabinet.

The White House announced on Tuesday that Obama plans to visit Israel, the West Bank and Jordan this spring, raising prospects of a new U.S. push to restart Israeli-Palestinian peace efforts frozen for the past two years.

The White House gave no exact dates for the trip, Obama's first to Israel since taking office. Israel's Channel 10 television station cited unnamed sources in Washington last week saying the visit to Israel would start on March 20.

In public remarks at the cabinet session, Netanyahu put Iran at the top of his list of talking points with Obama and referred only in general terms to peace efforts with the Palestinians, stopping short of setting a revival of bilateral negotiations as a specific goal of the visit.

"The president and I spoke about this visit and agreed that we would discuss three main issues ... Iran's attempt to arm itself with nuclear weapons, the unstable situation in Syria ... and the efforts to advance the diplomatic process of peace between the Palestinians and us," Netanyahu said.

U.S.-hosted negotiations between Israel and the Palestinians collapsed in September 2010 in a dispute over Israeli settlement-building in the occupied West Bank, land captured in a 1967 war and which Palestinians seek as part of a future state that includes Gaza and East Jerusalem.

Obama and Netanyahu discussed the coming trip in a January 28 telephone call.


The visit will take place only after Netanyahu puts together a new governing coalition following his narrower-than-expected victory in Israel's January 22 election.

Netanyahu, who heads the right-wing Likud party, has begun talks with prospective political partners and still has up to five weeks to complete the process.

Citing the dangers Israel faces from the "earthquake that is happening around us", a reference to Arab upheaval in the region and the prospect of a nuclear-armed Iran, Netanyahu said Obama's visit now was particularly important.

Obama's tensions with Netanyahu have been aggravated by the Israeli leader's demands for U.S. "red lines" on Iran's nuclear program - something the president has resisted, though he has said military options are on the table if sanctions and diplomacy fail.

Iranian President Mahmoud Ahmadinejad said on Sunday that Tehran would not negotiate about its nuclear program under pressure, and would talk to its adversaries only if they stopped "pointing the gun".

Iran dismisses Western suspicions that its nuclear program is aimed at building weapons. Israel is widely believed to have the Middle East's only nuclear arsenal.

Netanyahu has insisted he will stick to the red line laid down in September, when he told the United Nations that Iran should not have enough enriched uranium to make even a single warhead.

He gave a rough deadline of summer 2013, and Israeli political commentators have speculated that Obama had opted to visit Israel before that date to caution Netanyahu against any go-it-alone attack against Iran's nuclear facilities.

Obama visited Israel as a presidential candidate in 2008 but drew Republican criticism for not travelling there in his first term. His Republican predecessor, former President George W. Bush, also waited until his second term to go to Israel.

(Editing by Matthew Tostevin)

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Protests erupt as India executes man for 2001 parliament attack

NEW DELHI (Reuters) - India hanged a Kashmiri man on Saturday for an attack on the country's parliament in 2001, sparking clashes in Kashmir between protesters and police who wielded batons and fired teargas. Dozens of people were injured.

President Pranab Mukherjee rejected a mercy petition from Mohammad Afzal Guru and he was hanged at 8 a.m. (0230 GMT) in Tihar jail in the capital, New Delhi. Security forces anticipating unrest had imposed a curfew in parts of insurgency-torn Kashmir and ordered people off the streets.

Guru, from the Indian part of divided Kashmir, was convicted of helping organize arms for the gunmen who made the attack and a place for them to stay. He always maintained his innocence.

India blamed the attack on the parliament of the world's largest democracy on militants backed by Pakistan, targeting the prime minister, interior minister and legislators in one of the country's worst ever militant attacks.

Pakistan denied any involvement and condemned the attack but tension rose sharply and brought the nuclear-armed rivals dangerously close to their fourth war. Nearly a million soldiers were mobilized on both sides of the border and fears of war only dissipated months later, in June 2002.

The hanging was ordered less than three months after India executed the lone surviving gunman of a 2008 attack in the city of Mumbai in which 166 people were killed.

Saturday's execution could help the ruling Congress party deflect opposition criticism of being soft on militancy as it gears up for a series of state elections this year and a general election due by 2014, while grappling with an economic slowdown.

"Congress has decided to be more proactive in view of the elections, not only in terms of economic policy but also matters like the hanging," said political analyst Amulya Ganguli.

"The Congress has now deprived the BJP of a propaganda plank," he said, referring to the main opposition Bharatiya Janata Party.

Government officials dismissed suggestions that electoral politics played a role in the decision to execute Guru.

In major towns of Indian Kashmir, where security forces have battled a Muslim separatist insurgency for decades, barricades were erected and hundreds of police and paramilitary force members were deployed.

"The hanging of Afzal Guru is a declaration of war by India," said Hilal Ahmad War, leader of a separatist faction.

Thirty-six people including 23 policemen were injured in protests, said police spokesman Manoj Sheeri, with most of the violence in Guru's home district.

Authorities shut down internet services to try to stop news of the hanging and unrest spreading. The chief minister of Jammu and Kashmir state, Omar Abdullah, made a televised appeal for calm.

Scuffles also broke out in New Delhi between Hindu activists and demonstrators who gathered at a city-centre protest site to condemn the execution, a Reuters witness said.


Five militants stormed the parliament complex in New Delhi on December 13, 2001, armed with grenades, guns and explosives, but security forces killed them before they could enter the main chamber. Ten other people, most of them security officers, were killed.

Guru said he never got a fair trial and his brother reiterated that on Saturday, adding that authorities had not warned the family of his execution.

"At least the government should have given the family a chance to meet him," said the brother, Ajaz Ahmad Guru. "He didn't get a fair trial. His wife is in deep shock."

India said the Pakistan-based Jaish-e-Mohammad militant group was responsible for the parliament attack. The group fights Indian rule in Muslim-majority Kashmir.

The hanging last year of Mohammad Ajmal Kasab, the lone surviving Pakistani militant involved in the 2008 Mumbai attacks, after a long lull in executions, prompted speculation that India would move quickly to execute Guru.

But unlike Kasab's execution, which sparked celebrations in the streets, Guru's case was seen as more divisive.

Some Kashmiri leaders warned that hanging Afzal would fuel the revolt in India's part of the Himalayan region in which tens of thousands of people have been killed since 1989.

Curfews were imposed in Srinagar, the region's summer capital in the Kashmir valley, and major towns including Baramulla, Guru's home town.

Kashmir is divided between India and Pakistan, both of which claim the region in full and rule it in part. They have fought two of their three wars over the region.

In Pakistan-controlled Kashmir, more than 250 people took to the streets to protest against the hanging, shouting "Down with India" and burning an Indian flag.

India has long accused Muslim Pakistan of arming and funding militants to fight Indian forces in Kashmir. Pakistan says it only provides moral support to the fellow-Muslim people of Kashmir, who, Pakistan says, face harsh Indian rule.

The dispute, a legacy of the division of the sub-continent at the end of British rule, is the main factor souring relations between the neighbors.

(Additional reporting by Fayaz Bukhari, Mansi Thapliyal, Ashok Pahalwan, Abu Arqam Naqash, Arnika Thakur and Satarupa Bhattacharjya; Editing by Ross Colvin and Robert Birsel)

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