2000 !GCAT !GSPO Trainer Berti Vogts kept faith with his entire European championship winning squad for Germany's first match since their title victory, a friendly in Poland. Vogts picked no new players for the squad for the September 4 game in Zabrze. Instead on Friday he nominated all 23 Euro '96 veterans including Bremen's Jens Todt, called up before the final by special UEFA dispensation. He will, however, have to do without the Dortmund trio of libero Matthias Sammer, midfielder Steffen Freund and defender Rene Schneider, who were all formally nominated despite being injured. "This squad is currently the basis of my planning for the 1998 World Cup," Vogts said. "We'll have to see which other players produce good league performances to play themselves into the squad." Squad: Goalkeepers - Oliver Kahn, Andreas Koepke, Oliver Reck Defenders - Markus Babbel, Thomas Helmer, Juergen Kohler, Stefan Reuter, Matthias Sammer, Rene Schneider Midfielders - Mario Basler, Marco Bode, Dieter Eilts, Steffen Freund, Thomas Haessler, Andreas Moeller, Mehmet Scholl, Thomas Strunz, Jens Todt, Christian Ziege Forwards - Oliver Bierhoff, Fredi Bobic, Juergen Klinsmann, Stefan Kuntz. 2001 !GCAT !GSPO Following are the European soccer draws for the UEFA cup and the cup's winners cup involving Greek teams that took place today in Geneva: x-AEK Athens (Greece) v Chemlon Humenne (Slovakia) x-Olympiakos v Ferencvaros (Hungary) x-PAO v Legia Warsaw (Poland) x indicates seeded teams. --Dimitris Kontogiannis, Athens Newsroom +301 3311812-4 2002 !GCAT !GSPO European champions Juventus will face English league and cup double winners Manchester United in this season's European Champions' League. The draw made on Friday pitted Juventus, who beat Dutch champions Ajax Amsterdam 4-2 on penalties in last year's final, against Alex Ferguson's European hopefuls in group C. The other two teams in the group are last season's Cup Winners' Cup runners-up Rapid Vienna and Fenerbahce of Turkey. Juventus meet United in Turin on September 11, with the return match at Old Trafford on November 20. United have dominated the premier league in the 1990s, winning three English championships in four years, but have consistently failed in Europe, crashing out of the European Cup to Galatasaray of Turkey and Spain's Barcelona at their last two attempts. They have not lifted a European Trophy since 1991 when they beat Barcelona in the Cup Winners' Cup final, and their one and only European Cup triumph was way back in 1968, when they beat Benfica of Portugal 4-1 at Wembley. Juventus have won the European Cup twice. Before conquering Ajax last year they beat United's big English rivals Liverpool in the ill-fated 1985 final in the Heysel stadium in Brussels. "Manchester United is one of the biggest teams in Europe and they have a great manager. Our games against them will be very tough but at this stage there are no easy games," Juventus managing director Luciano Moggi said. United chairman Martin Edwards, who has assembled a multi-national side at Old Trafford, was upbeat. "We have added one or two new players to the squad and strengthened it. With the three plus two rule (on the number of foreign players allowed) gone we can play to our full strength which we couldn't before." Ajax, who won Europe's top domestic trophy in 1995 after two decades in the European doldrums, face French champions Auxerre in Group A. The other two teams are Glasgow Rangers, the dominant force of Scottish soccer, and Grasshoppers of Zurich, who managed to hold Ajax to a goalless draw in last year's champions league. The mighty AC Milan, who beat Barcelona 4-0 in the 1994 final in Athens, should have few problems qualifying from Group D, where they face Porto of Portugal and the Scandinavian duo Gothenburg of Sweden and Rosenborg of Norway. Milan also won the European Cup in 1989 and 1990, when they beat Steaua Bucharest and Benfica respectively. Steaua, European champions in 1986, take on last year's quarter-finalists Borussia Dortmund and Spanish double winners Atletico Madrid in Group B. Widzew Lodz of Poland are the other team in the group. In the Cup Winners' Cup, holders Paris St Germain face what should be an easy opening tie against Vaduz of Liechtenstein. Yugoslavia's 1991 European Cup winners Red Star Belgrade meet Germany's Kaiserslautern in perhaps the most attractive of the first round ties. Four-times European Cup winners Liverpool play MyPa-47 of Finland, while Barcelona, who lifted the trophy in 1979, 1982 and 1989 take on AEK Larnaca of Cyprus. Ambitious UEFA Cup holders Bayern Munich start their title defence against Valencia, the runners-up in the Spanish league last season. "We have never played Valencia before and the Spanish clubs are always tough opponents," Bayern manager Karl Hoefner said. "We are in a strong group and Valencia are easily one of the best teams in it." Panathinaikos of Athens take on Legia Warsaw in a repeat of last year's European Cup quarter-final. The Greeks won that clash 3-0 on aggregate before going out to Ajax. Italy's Parma, winners in 1995, face Guimaraes of Portugal, while Rome's Lazio take on the early French league leaders Lens. Last year's suprise semifinalists Slavia Prague of the Czech Republic play Malmo of Sweden while English premier league side Arsenal, who won the Cup Winners' Cup in 1994, challenge Borussia Moenchengladbach. Milan president Adriano Galliani said: "Let's be honest -- this is not a very difficult group. For the umpteenth time we've got Porto, and then these two Scandinavian teams, Gothenburg, who have a good history in Europe, and Rosenborg." 2003 !GCAT !GSPO Draws for the first round of the European club soccer competitions made on Friday (x denotes seeded team): UEFA Cup Lyngby (Denmark) v x-Club Brugge (Belgium) Casino Graz (Austria) v Ekeren (Belgium) Besiktas (Turkey) v Molenbeek (Belgium) Alania Vladikavkaz (Russia) v x-Anderlecht (Belgium) Cup Winners' Cup x-Cercle Brugge (Belgium) v Brann Bergen (Norway) 2004 !GCAT !GSPO Draws for the first round of the three major European club soccer competitions made on Friday (x denotes seeded team): UEFA Cup x-Brondby (Denmark) v Aarau (Switzerland) CSKA Moscow (Russia) v x-Feyenoord Rotterdam (Netherlands) Apoel Nicosia (Cyprus) v Espanyol (Spain) Guingamp (France) v Internazionale (Italy) Odense (Denmark) v x-Boavista (Portugal) x-Olympiakos (Greece) v Ferencvaros (Hungary) Newcastle United (England) v Halmstads (Sweden) Aberdeen (Scotland) v Barry Town (Wales) Hutnik Krakow (Poland) v x-Monaco (France) Roma (Italy) v x-Dynamo Moscow (Russia) Celtic (Scotland) v Hamburg (Germany) Tenerife (Spain) v Maccabi Tel Aviv (Israel) x-Panathinaikos (Greece) v Legia Warsaw (Poland) x-Arsenal (England) v Borussia Moenchengladbach (Germany) Chernomorets Odessa (Ukraine) v National Buchurest (Romania) Torpedo Moscow (Russia) v Dynamo Tbilisi (Georgia) Bodo-Glimt (Norway) v x-Trabzonspor (Turkey) Lyngby (Denmark) v x-Club Brugge (Belgium) Karlsruhe (Germany) v Rapid Buchurest (Romania) Aston Villa (England) v Helsingborgs (Sweden) x-Lazio (Italy) v Lens (France) Silkeborg (Denmark) v x-Spartak Moscow (Russia) Slavia Prague (Czech Republic) v Malmo (Sweden) Casino Graz (Austria) v Ekeren (Belgium) Add UEFA Cup Montpellier (France) v x-Sporting Lisbon (Portugal) Valencia (Spain) v x-Bayern Munich (Germay) Dynamo Kiev (Ukraine) v Neuchatel Xamax (Switzerland) Besiktas (Turkey) v Molenbeek (Belgium) x-Parma (Italy) v Guimaraes (Portugal) Alania Vladikavkaz (Russia) v x-Anderlecht (Belgium) Schalke 04 (Germany) v Roda JC (Netherlands) Tirol Innsbruck (Austria) v Metz (France) First leg September 10, second leg September 24. Cup Winners' Cup x-Nimes (France) v Kispest Honved (Hungary) x-Sturm Graz (Austria) v Sparta Prague (Czech Republic) Constructorul Chisinau (Moldova) v x-Galatasaray (Turkey) x-Kaiserslautern (Germany) v Red Star Belgrade (Yugoslavia) MyPa-47 Anjalonkoski (Finland) v x-Liverpool (England) x-Sion (Switzerland) v Niva Vinnitza (Ukraine) x-Aarhus AGF (Denmark) v Olimpija Ljubljana (Slovenia) x-Cercle Brugge (Belgium) v Brann Bergen (Norway) Add Cup Winners' Cup x-Lokomotiv Moscow (Russia) v Varteks (Croatia) Reykjavik (Iceland) v x-Solna (Sweden) x-Barcelona (Spain) v AEK Larnaca (Cyprus) x-Benfica (Portugal) v Ruch Chorzow (Poland) x-AEK Athens (Greece) v Chemlon Humenne (Slovakia) Gloria Bistrita (Romania) v x-Fiorentina (Italy) Dynamo Batumi (Georgia) v x-PSV Eindoven (Netherlands) Vaduz (Liechtenstein) v x-Paris St Germain (France) First leg September 12, second leg September 26. Champions' League: Group A 1. Glasgow Rangers (Scotland) 2. Auxerre (France) 3. Ajax Amsterdam (Netherlands) 4. Grasshopper Zurich (Switzerland) Group B 1. Widzew Lodz (Poland) 2. Atletico Madrid (Spain) 3. Steaua Bucharest (Romania) 4. Borussia Dortmund (Germany) Group C 1. Manchester United (England) 2. Rapid Vienna (Austria) 3. Fenerbahce (Turkey) 4. Juventus (Italy) Group D 1. Porto (Portugal) 2. Gothenburg (Sweden) 3. Rosenborg (Norway) 4. AC Milan (Italy) Fixtures and dates to follow. Champions' League fixtures: September 11 Group A - Auxerre v Ajax , Grasshopper Zurich v Rangers Group B - Atletico v Steaua Bucharest, Borussia Dortmund v Widzew Lodz Group C - Rapid Vienna v Fenerbahce, Juventus v Manchester United Group D - Gothenburg v Rosenborg, AC Milan v Porto. Champions' League fixtures: September 25 Group A - Rangers v Auxerre, Ajax v Grasshopper Group B - Widzew Lodz v Atletico, Steaua v Dortmund Group C - Manchester United v Rapid, Fenerbahce v Juventus Group D - Porto v Gothenburg, Rosenborg v AC Milan October 16 Group A - Ajax v Rangers, Auxerre v Grasshopper Group B - Steaua v Widzew Lodz, Atletico v Dortmund Group C - Fenerbahce v Manchester United, Rapid v Juventus Group D - Rosenborg v Porto, Gothenburg v AC Milan October 30 Group A - Rangers v Ajax, Grasshopper v Auxerre Group B - Widzew Lodz v Steaua, Dortmund v Atletico Group C - Manchester United v Fenerbahce, Juventus v Rapid Group D - Porto v Rosenborg, AC Milan v Gothenburg November 20 Group A - Ajax v Auxerre, Rangers v Grasshopper Group B - Steaua v Atletico, Widzew Lodz v Dortmund Group C - Fenerbahce v Rapid, Manchester United v Juventus Group D - Rosenborg v Gothenburg, Porto v AC Milan December 4 Group A - Auxerre v Rangers, Grasshopper v Ajax Group B - Atletico v Widzew Lodz, Dortmund v Steaua Group C - Rapid v Manchester United, Juventus v Fenerbahce Group D - Gothenburg v Porto, AC Milan v Rosenborg. UEFA later made the following changes to first leg ties in the UEFA Cup: Molenbeek (Belgium) v Besiktas (Turkey) ) Guimaraes (Portugal) v x-Parma (Italy) x-Club Brugge (Belgium) v Lyngby (Denmark) Rapid Bucharest (Romania) v Karlsruhe (Germany) Lens (France) v x-Lazio (Italy) x-Spartak Moscow (Russia) v Silkeborg (Denmark) Malmo (Sweden) v Slavia Prague (Czech Republic) Ekeren (Belgium) v Casino Graz (Austria) Ferencvaros (Hungary) v x-Olympiakos (Greece) 2005 !GCAT !GSPO A Russian ice hockey player was detained by police on Friday after a violent brawl at a friendly match between NH-90 from Nykoping in southern Sweden and the Russian team Torpedo Jaroslava. Local prosecutor Olof Ostberg said Jaroslava back Sergei Gorbachev would be charged with assault and battery after he knocked down NH-90's Tobias Borg from behind and repeatedly punched him in the face after the final whistle. Gorachev's team mates prevented the referees from intervening to stop the brawl after a bad-tempered clash which NH-90 won 2-0. The player was detained by police as the Russian team tried to leave the Nykoping rink on the team bus. "He'll be tried today or tomorrow. He could face up to a year in jail," Ostberg said. 2006 !GCAT !GSPO Sri Lanka and Australia agreed on Friday that relations between the two teams had healed since the Sri Lankans' acrimonious tour last year. The Sri Lankans were first found guilty then cleared of ball tampering and off-spinner Muttiah Muralitharan was called for throwing during a controversial three-test series in Australia. "Our concern is to get out there and play proper cricket," Sri Lanka captain Arjuna Ranatunga told a news conference on the eve of a warmup match between the World Cup champions and a World XI team scheduled for Saturday. "What happened is history." Australian team manager Cam Battersby said he agreed with Ranatunga. "I believe relations between the two teams will be excellent," Batterby said. The Australians are making their first visit to the Indian Ocean island since boycotting a World Cup fixture in February after a terrorist bomb in Colombo. Australia have been promised the presence of commandos, sniffer dogs and plainclothes policemen to ensure a limited overs tournament is trouble-free. The tournament, starting on August 26, also includes India and Zimbabwe. Battersby said he was satisfied with the security arrangements. Sri Lankan officials said they expected heavy rain which washed out a warmup match on Friday should cease by Saturday. Australia, led by wicketkeeper Ian Healy, opened their short tour of Sri Lanka with a five-run win over the country's youth team on Thursday. 2007 !GCAT !GCRIM !GPOL The South African government plans to issue a promised ban on guns at public meetings as part of a package to curb gang-related violence, a spokesman said on Friday. Maxwell Mulaudzi said legal experts would spend the weekend drafting a proclamation in terms of a law allowing policing minister Sydney Mufamadi to impose the ban in specific parts of the country. "The minister plans to implement the ban in the Western Cape (province) and he is contemplating KwaZulu-Natal as well. If the text is ready on Monday, the ban will go into force next week," Mulaudzi told Reuters. Mufamadi on Thursday announced a series of measures agreed in consultation with police and other ministers and said parliament would be asked to reschedule its programme later this year to adopt legislation necessary to implement the package. "I can't see that there is any way the legislation can be brought to parliament before October, but we will move heaven and earth to get it through as quickly as possible," said Douglas Gibson, a Democratic Party member of parliament's scheduling committee. Mufamadi spearheaded the drafting of a crackdown on violence following clashes in Cape Town between drug-dealing gangsters and the Moslem-based vigilante movement People Against Gangsterism and Drugs (PAGAD). PAGAD supporters recently burned and shot a drug baron to death and militant anti-crime campaigners armed with handguns, shotguns and automatic rifles have marched repeatedly since then, threatening to kill drug dealers. Police in riot-control vehicles prevented an armed crowd from approaching the home of an alleged drug-dealer early on Friday. Mufamadi's plans include: - minimum sentences for gang-related crime - a new "super-maximum" category of prison security to prevent breakouts and keep gangsters away from other criminals - tougher parole measures to ensure that prisoners serve at least two-thirds of sentences for serious or gang-related crimes - measures to limit contact between gangs in society and in prisons, which are the main recruiting ground for gangs - a crackdown on police corruption, including measures to encourage "whistle-blowers" to inform on corrupt colleagues - special units to supervise investigations into gang-related crime and to evaluate unsolved gang-related investigations - measures to speed up prosecutions and to protect witnesses 2008 !GCAT These are the leading stories in the Angolan press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - JORNAL DE ANGOLA - The Angolan Chief of State addressed a letter to UN Security Council proposing dates for the conclusion of the peace process in Angola. He proposed definite dates, August 25 for return of Unita generals to the joint army, September 5 for the beginning of the formation of the Government of National Unity and Reconciliation. Until this date the free circulation of peoples and goods should be guaranteed, the government administration installed in all areas and the Unita deputies should occupy their places in the National Assembly. The president justified his proposal by the delays verified in the peace process, including the fact that areas under Unita control or occupation have not been effectively demilitarised, where the Unita military forces have been substituted by their so-called police. - President Dos Santos proposes the establishment by UN Security Council of definitive and final timetable for the tasks and obligations under the Lusaka Agreement and the sending of a mission of SC, as soon as possible, to supervise the execution of the agreement. 2009 !GCAT These are the leading stories in the Zimbabwe press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - THE ZIMBABWE INDEPENDENT - State resources in excess of an estimated Z$2 million were used at Zimbabwean President Robert Mugabe's wedding to his former secretary Grace Marufu last weekend despite assurances that the function was a private occasion which would funded from Mugabe's own resources, sources told the Zimbabwe Independent. - President Robert Mugabe and his bride, Grace, were this week spotted taking a break in Cape Town, South Africa, after their weekend wedding. - With consumer inflation slowing half a point in July to 22 percent -- its lowest level in a year -- market analysts seem satisfied that, at last, Zimbabwe's inflation cycle has turned, Antony Hawkins, professor of business studies at the University of Zimbabwe reported in an article commissioned by Reuters. - - - - THE HERALD - Public Service, Labour and Social Services Minister Florence Chitauro said on Thursdqy negotiations to resolve a salary dispute with striking civil servants will only start after the workers have gone back to work. Zimbabwe's civil servants defied an earlier ultimatum from Chitauro to go back to work or face dismissal and also ignored calls by their union leaders to stop the strike on Thursday. - Zimbabwean President Robert Mugabe will attend the annual summit of the 12-nation Southern African Development Community to be held in the Lesotho capital, Maseru, at the weekend, the ministry of foreign affairs said on Thursday. - Zimbabwe's High Court on Thursday ordered Harare town clerk Edward Kanengoni to step down as returning officer for forthcoming mayoral elections, saying he could be biased against an independent contestant due to his ties with the ruling ZANU-PF party. -- Emelia Sithole, Harare Newsroom: +263-4 72 52 28/9 2010 !GCAT These are the leading stories in the South African press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - BUSINESS DAY - Correctional services minister Sipho Mzimela has announced plans to tighten the parole system and to build high-security "super maximum" prisons for dangerous criminals in response to high crime levels. - First National Bank Holdings Ltd managing director Barry Swart apologised on Thursday night for embarrasing the bank, following his censure by the board for awarding a decorating contract to his daughter. - Retail group Wooltru Ltd lifted earnings including exceptional items 11 percent to 398.3 million rand for the year to June, restrained by losses in its mainstay Massmart operation and the closure of fledgling retail chain Number 1. - The ANC's claim that the bombing of Magoo's bar in Durban and Church Street in Pretoria were attacks aimed at military targets raises the possibility that they were sanctioned at high levels within the organisation. - Southern African ministers decided on Thursday to destroy about 200,000 cattle infected with highly contagious bovine lung disease in Namibia, Botswana and Tanzania. - Drastic changes to South Africa's higher education system, intended to create places for an additional 700,000 students within nine years and put all institutions on an equal footing, were proposed by the national commission on higher education. - The South African Broadcasting Corporation warned that its fledgling satellite television service AstraSat could miss the December target set for its pay service launch. - - - - BUSINESS REPORT - Chris Stals, the Reserve Bank governor, has contradicted claims made by banking officials and money market dealers this week that commercial banks were "round tripping" at the Reserve Bank. - Wooltru, the diversified retail company, weathered the downswing in consumer spending and divisional losses to post an 11 percent rise in taxed profit to 399 million in the year to June 30. - Sappi Ltd , the pulp and paper company, is at the centre of a scandal which could shut down its industrial cellulose plant along the south coast of KwaZulu Natal. - The Nel commission has rejected the Policy Board for Financial Services and Regulation's recommendation that financial advisors should regulate themselves, fuelling the battle over who should regulate the financial services industry. - OfficeMart creditors may receive only between 11 cents and 15 cents on the rand if the cession of a loan by its parent company, Mathieson and Ashley Holdings Ltd , to Nedbank is valid, sources close to the company said. - - - - THE STAR - The police slapping of subpoenas on journalists on at least seven publications and news agencies, to compel them to reveal information, has sparked an outcry among the media fraternity who said it smacked of the harsh 1980s. - The picture is still far from complete. But the readiness of major political parties to account for their actions in public this week was unprecedented anywhere in the world, Truth and Reconciliation chairman Alex Boraine said. -- Johannesburg newsroom, +27 11 482 1003 2011 !GCAT IZVESTIA - President Boris Yeltsin is dissatisfied with the performance of his security adviser Alexander Lebed in charge of tackling the Chechen crisis. - A state tax accountant in the Southern Russian city of Volgograd tricked the department where she was working out of 24 million roubles ($5,000). PRAVDA - For the first time in the last five years a communist has entered the government. SEVODNYA - President Boris Yeltsin is either too sure of himself or is concerned by matters other than politics to have let Alexander Lebed play it solo in the Chechen crisis. - The new government gives the impression of a team which will play a common game but by different rules. - Russia's inflation takes on negative values as the budget deficit is being turned into debt. NEZAVISIMAYA GAZETA - President Yeltsin shortly goes for treatment to a special heart clinic outside Moscow where two high-tech wards have been set up for him, says the paper, quoting a source in the medical centre. ROSSIISKAYA GAZETA - It is high time Russian generals stopped sending angry warnings to each other and started to work together. MOSKOVSKY KOMSOMOLETS - Russia suffered its worst defeat in two years of the Chechen war when it lost Grozny to the rebels and Alexander Lebed went there in person to sign a document of capitulation. --Andrei Shukshin, Moscow Newsroom, +7095 941 8520 2012 !GCAT !GDIP The Romanian government on Friday approved a treaty ending longstanding disputes with neighbouring Hungary and it is ready for signing, Foreign Minister Teodor Melescanu said. He said the accord, essential for both countries' ambitions to join NATO and the European Union, could be signed in the first half of September. "The opportunity for finalising the treaty resulted from a compromise by both sides and I really don't see any obstacles which might prevent the Romanian and Hungarian parliaments ratifying it," Melescanu told a news conference. Hungarian and Romanian experts met for two days this week in Budapest to put finishing touches to the treaty. Four years in the making, the pact was long delayed by disputes over minority rights for Hungarians in Romania. The leftist government of the Party of Social Democracy (PDSR) accepted the text at a cabinet meeting on Friday, said Melescanu, and ministers from nationalist coalition partner, the Romanian National Unity Party (PUNR), did not object. "All ministers agreed the treaty should be signed as early as possible," said Melescanu, rejecting press reports that the PUNR would try to block the treaty. PUNR leader Gheorghe Funar has asked for a referendum on the historic deal. In turn PDSR chiefs have threatened to kick his party out of the ruling coalition if it is obstructive. Hungary said on Wednesday it was set to sign the accord, despite criticism from opposition parties and ethnic Hungarian politicians in Romania. There are 1.6 million Hungarians in Romania, some seven percent of the population. Hungary had sought ethnic autonomy for its kinfolk, which Bucharest rejected, mindful of Hungary's long rule over what is now central Romania and fearing a Yugoslav-style secession. A deal was struck after Bucharest included a Council of Europe-approved clause on minority rights which Budapest then acknowledged did not grant Hungarians collective privileges. Melescanu said he hoped the treaty would be the starting point in a process of reconciliation between the two countries, which have strengthened commercial and military links since the 1989 fall of communism despite sporadic political bickering. REUTER 231557 GMT aug 96 2013 !GCAT !GDIP Romania's foreign minister said on Friday a treaty ending longstanding disputes with neighbouring Hungary had been approved by his government and was ready for signing. Teodor Melescanu said the treaty, essential for both countries' ambitions to join NATO and the European Union, could be signed in the first half of September. "The opportunity for finalising the treaty resulted from a compromise by both sides and I really don't see any obstacles which might prevent the Romanian and Hungarian parliaments ratifying it," Melescanu told a news conference. Hungarian and Romanian experts met for two days this week in Budapest to put the finishing touches to the treaty. Four years in the making, the treaty has been long delayed by disputes over minority rights for Hungarians in Romania. The leftist government of the Party of Social Democracy (PDSR) accepted the text at a cabinet meeting on Friday, said Melescanu, and ministers from nationalist coalition partner, the Romanian National Unity Party (PUNR), did not object. "All ministers agreed the treaty should be signed as early as possible," said Melescanu, rejecting press reports that the PUNR would try to block the treaty. PUNR leader Gheorghe Funar has asked for a referendum on the historic deal. In turn PDSR chiefs have threatened to kick his party out of the ruling coalition if it is obstructive. Hungary said on Wednesday it was set to sign the accord, despite criticism from opposition parties and ethnic Hungarian politicians in Romania. There are 1.6 million Hungarians in Romania, some seven percent of the population. Hungary had sought ethnic autonomy for its kinfolk, which Bucharest rejected, mindful of Hungary's long rule over what is now central Romania and fearing a Yugoslav-style secession. A deal was struck after Bucharest included a Council of Europe approved clause on minority rights which Budapest then acknowledged did not grant Hungarians collective privileges. Melescanu said he hoped the treaty would be the starting point in a process of reconciliation between the two countries, who have strengthened commercial and military links since the 1989 fall of communism despite sporadic political bickering. 2014 !GCAT !GPOL Romania's leftist government of Prime Minister Nicolae Vacaroiu on Friday appointed Daniela Bartos as new Health Minister and Grigore Zanc as Minister of Culture in the last cabinet reshuffle ahead of November polls. Government spokesman Mihai Rosca told a news conference that Bartos and Zanc were given the top jobs to improve activity and bring concrete solutions to urgent issues in the two ministries. On Wednesday Vacaroiu confirmed that Iulian Mincu, Health Minister since 1992 and Viorel Marginean, Culture Minister, had resigned for what he called "personal reasons". Mincu, the personal physician of the late dictator Nicolae Ceausescu had come under fire from medical staff, who blamed him for the disastrous state of the country's health system. Newly-appointed Bartos said she would first ask government to amend the budget, adding her ministry had to pay back some 80 billion lei ($25 million) it owed to chemist shops for medicaments given for free. Zanc, a former local government representative in the Transylvanian town of Cluj, promised to settle old differences between the Culture Ministry and Bucharest city hall over municipal museums and libraries. "These institutions should be returned to the city hall and I think this is possible." Zanc said. Rosca said that Vacaroiu had also appointed new state secretaries in the Labour and Health ministries. Reports in the local media saw the reshuffle as the ruling Party of Social Democracy's (PDSR) last-ditch attempt to boost its image ahead of parliamentary and presidential elections due on November 3. -- Bucharest Newsroom 40-1 3120264 2015 !C12 !C13 !CCAT !GCAT !GCRIM A U.S. court decision in a trademark suit allowing Hungarian meat food processor Pick Szeged Rt to continue using the Pick name came into force as the plaintiffs -- descendants of the original Pick family -- did not appeal against the verdict. "Our legal adviser Baker&McKenzie informed us that the decision came into force as the Pick descendants did not appeal during the time they were given to do so," Pick said in a statement. In early April the U.S. court ruled in favour of Pick and against the Pick family in a trademark suit initiated by the family's descendants no longer connected with the firm, who objected to the use of the family name. A similar legal suit in Hungary was closed late last year, following the family's withdrawal of their appeal to the Budapest Supreme Court. -- Budapest newsroom (36 1) 266 2410 2016 !E41 !E411 !ECAT !GCAT !GJOB The number of jobless in Slovakia in July was 321,661, or 12.53 percent of the workforce, up from 12.12 percent in June, the Slovak Ministry of Social Affairs and Labour said on Friday. SLOVAK UNEMPLOYMENT RATE July '96 June '96 July '95 Jobless total 321,661 311,244 343,147 percentage of workforce 12.53 12.12 13.49 -- Bratislava Newsroom, 42-7-210-3687 2017 !GCAT !GDIP Commonwealth ministers concerned about human rights in Nigeria have cancelled a planned trip there because of government restrictions on their mission, the Canadian government said on Friday. Ministers had planned to visit the Nigerian capital Abuja on Aug. 29-30, but only if they could talk to private groups and individuals in addition to government officials. "Following the failure of Nigeria to agree to the Commonwealth Ministerial Action Group's conditions for its planned visit to Nigeria at the end of this month, CMAG foreign ministers have decided that the visit should not go forward at this time," a Foreign Ministry statement said. Foreign ministers of the British Commonwealth, which suspended Nigeria because of concerns about democracy and alleged human rights abuses, will meet in London on Wednesday to discuss what to do, he told a news conference. "A lot of members were counting on this (mission) being a great breakthrough. It doesn't look like it's going to be that way," Foreign Minister Lloyd Axworthy told an earlier news conference. "So it may be that we'll have to now consider collective action," he said, noting the impact from action taken by African states against Burundi. A group of African states imposed sanctions against Burundi in response to the July 25 coup that overthrew the government of elected Hutu President Sylvestre Ntibantunganya and installed Major Pierre Buyoya . The Nigerian foreign ministry issued a statement on Thursday saying the visit should not be construed as a fact-finding mission. One of the incidents which sparked the international outcry against Nigeria was the execution last November of author Ken Saro-Wiwa and eight other minority rights activists on charges of murder. His brother called on Canada in an Ottawa news conference on Thursday to urge fellow Commonwealth nations to impose an oil embargo on the country, Africa's most populous nation. Axworthy said that in any case Canada was moving ahead with its own measures. He said, for example, that Christine Stewart, the junior minister who was to have gone to Nigeria, has been working with Canadian oil companies on a voluntary code of conduct regarding Nigeria. 2018 !GCAT !GDIP Commonwealth ministers concerned about human rights in Nigeria may cancel a planned trip there because of government restrictions on their mission, Canadian Foreign Minister Lloyd Axworthy said on Friday. "The reaction of the regime there is such that many of us feel that the mission under the present circumstances shouldn't go ahead," Axworthy said. Commonwealth foreign ministers will meet in London on Wednesday to discuss what to do, he added. 2019 !C12 !C13 !CCAT !GCAT !GCRIM !GPOL The tobacco industry defended assaults on two fronts Friday, as President Clinton formally approved new federal oversight measures regulating tobacco while an Indiana jury deliberated in the latest tobacco injury suit. In a Rose Garden ceremony at the White House, Clinton called the regulation of tobacco as a drug an "historic action" aimed at protecting children from exposure to the smoking habit. The new rules, which give the Food and Drug Administration authority over tobacco, include requiring proof of age to purchase cigarettes, a ban on cigarette sales through vending machines in areas accessible to teenagers, and a ban on tobacco advertising within 1,000 yards of schools. The rules also mandate anti-smoking education by tobacco companies aimed at the country's youth. The tobacco industry lashed out at the regulations. Philip Morris Cos. Inc., the world's largest tobacco company, called the moves in Washington a "specious and arbitrary interpretation of federal law" and said only Congress has the authority to give the FDA regulatory authority over tobacco. "The FDA's rule sets the stage for restrictions that could lead the agency to do even more to deprive adults of their rights by unilaterally forcing the prohibition of cigarettes," said Steven Parrish, senior vice president of Philip Morris U.S.A. Meanwhile, an Indiana jury deliberated for a second day in the case brought by Yvonne Rogers against Philip Morris, RJR Nabisco Holdings Corp.'s R.J. Reynolds Tobacco Co., and other tobacco companies. The case, brought on behalf of Rogers' husband Richard, contends the industry was at fault for selling addictive products that cause cancer. Richard Rogers died of cancer in 1987 at the age of 52 after taking up smoking as a child. If the jury decides against the industry, it would be the second courtroom loss for the tobacco industry in two weeks and would mark the emergence of a monumental shift in tobacco litigation. On Aug. 9, a Florida jury awarded $750,000 to Grady Carter and his wife in their personal-injury suit against Brown & Williamson Tobacco Corp., the former employer of researcher-turned-whistleblower Jeffrey Wigand. Although the sum was a drop in the bucket for the $45 billion-a-year industry, it represented only the second time an award was granted by a jury. Brown & Williamson is a subsidiary of U.K.-based B.A.T Industries Plc. If that verdict is upheld on appeal, it would be the first time a tobacco company has been found liable for its product, something that has eluded attorneys trying to establish class-action suits against the industry. With the disclosure of a litany of internal documents from tobacco companies that undermine their historical assertions of innocence, juries are more likely to find cigarette makers culpable for the injuries their products caused, legal experts say. If the new federal regulations withstand the court battles the tobacco industry has threatened in response, it would be the most sweeping challenge to the industry's freedom since the 1964 Surgeon General's report and federally mandated cigarette warning labels that followed. Wall Street, which has recently pummeled tobacco stocks, showed little reaction to Friday's developments. Shares of Philip Morris rose $1.25 to $88 in late trading on the New York Stock Exchange, while RJR Nabisco was up 37.5 cents at $25.50, also on the NYSE. 2020 !C33 !C331 !CCAT !GCAT !GDEF Rejecting a demand by China, the U.S. Defense Department notified Congress on Friday of plans to sell Stinger missiles, launchers and other weapons to Taiwan. "The sale of this equipment will not affect the basic military balance in the region," the Pentagon told Congress. China had demanded on Aug. 15 that the sale be cancelled, saying the United States had made a "solemn commitment to China on the question of selling weapons to Taiwan." "We demand the U.S. side ... cancel plans to sell missiles to Taiwan to prevent creating new damage to Sino-U.S. relations," a Chinese foreign ministry spokesman said then. But U.S. officials said the weapons were defensive and so were permitted by agreements with China. The Pentagon said Taiwan wanted to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stinger missiles, 96 Humvee vehicles and 500 rounds of .50 caliber ammunition for an estimated $420 million. The notification made no mention of China's demand that the sale be cancelled, but U.S. officials said it was the sale to which China referred. The principal contractors are the Hughes Missile Systems Co., Boeing Missile and Space Systems Co. and AM General. Such sales must be made through the Defense Department, not directly by contractors, and Congress must be notified in case it wants to veto the sale. 2021 !C12 !CCAT !GCAT !GCRIM A U.S. federal judge in Richmond, Va., ruled in favor of U.S. investors in Lloyd's of London, granting their request for an injunction to block the London market's recovery plan, the office of a lawyer representing the investors said. In the 100-page order, Judge Robert Payne granted relief for all U.S. investors, not just those who had filed the lawsuit against Lloyd's, the lawyer's office said. Under the recovery plan, Lloyd's plans to reinsure billions of dollars of liabilities into a new company, Equitas. It was asking investors in Lloyd's, known as Names, to help pay for Equitas, but had offered them 3.2 billion stg ($4.8 billion) to offset this cost and end litigation. The Names, who financially backed Lloyd's with all their personal assets, had been given a deadline of August 28 to decide to accept or reject the recovery plan. Lloyd's chairman David Rowland said on Thursday that any injunction would be quickly appealed. Lloyd's appeal is due by 1000 EDT (1400 GMT) Saturday, the attorney's office said. The reply by the U.S. Names is due by 1700 EDT (2100 GMT) Monday. -- Patricia Vowinkel 212-859-1716 2022 !C12 !C18 !C181 !CCAT !GCAT !GCRIM !GENV Colorado attorney general Gale Norton said on Friday the state and the U.S. government sued Robert Friedland, former president and major stockholder of Galactic Resources Ltd, to recover the cost of cleaning up Galactic's Summitville gold mine, now a Superfund site. Friedland disclosed earlier from Vancouver, British Columbia that the Environmental Protection Agency had won a temporary court order in Canada preventing him from taking possession of US$152 million in Inco Ltd stock he was to receive under Inco's takeover of Diamond Fields Resources Inc . Norton said the U.S. government wanted Friedland's stock frozen in order to make sure there would be enough money to pay for the cleanup of the mine if Friedland were ultimately found responsible. The suit filed in U.S. district court in Denver alleges Friedland was responsible for the major decisions associated with Summitville, a contention he has denied. The mine, in southwestern Colorado, has come to represent the worst in gold mining. The EPA took the mine over after Summitville declared bankruptcy in 1992. Cleanup has been estimated in excess of $100 million. A spokeswoman for the EPA said the lawsuit against Friedland had been filed in May but was under seal until now. 2023 !C12 !CCAT !GCAT !GCRIM Offices at the U.S. District Court in Richmond, Va., stayed open beyond normal business hours on Friday, awaiting a judge's decision on whether or not he would issue an injunction plan blocking the organization plan of financial strapped insurance market Lloyd's of London. The office of the Clerk of the Courts for the U.S. District Court for the Eastern District of Virginia normally closes at 5:00 p.m. EDT (2100 GMT), but the judges have the authority to order the clerks to stay and await a decision. At 6:00 p.m. EDT (2200 GMT), clerks said they could not say when Judge Robert Payne would issue his ruling, or how long the office would remain open awaiting his action. 2024 !C12 !C13 !CCAT !GCAT !GCRIM Attorneys for Prudential Insurance Co of America are scheduled to appear in the U.S. District Court in Newark on September 9 to answer allegations the company destroyed documents that would be damaging to it in its upcoming court battles, court papers showed. A 1000 EDT (1400 GMT) hearing is tentatively scheduled before Judge Alfred Wolin in federal court to allow Prudential to answer the latest series of charges. Four former Prudential employees have filed affidavits, swearing that they observed "continuous and wholesale destruction by the management of sales and marketing information." Prudential said any such violation would be a violation of company policy. "We take the issue of destruction of documents very seriously," a Prudential spokesman said. "It is not condoned by any company policy." Prudential said it plans to respond in court to the specific allegations. The spokesman noted that Prudential last week fired senior vice president David Fastenberg for failing to enforce company directives about preserving documents. A company investigation found that files from its Greater Southern Regional Office in Jacksonville, Fla. were discarded in a reorganization and relocation of staff to New Jersey between April and June 1996. Fastenberg on Thursday filed a lawsuit in state Superior Court in Morristown, N.J., charging defamation and unlawful discharge. Fastenberg denied destroying company documents. Fastenberg said he was out of town on Prudential business when a secretary allegedly threw out company records at his Jacksonville office. A task force of U.S. insurance regulators last month recommended a record $35 million fine against Prudential for improper sales practices. The task force's action came in response to complaints that Prudential had improperly pressured unsophisticated investors into replacing their life insurance policies to generate commissions. Prudential has agreed to implement a remediation program. Prudential also launched a new sales process in June and last year hired a top regulator with the National Association of Securities Dealers to head up its compliance functions. In his affidavit, Thomas Cerchia, one of the former Prudential agents who left the firm after 13 years as an agent in Lake Success, New York, said the company "has engaged in an elaborate, management-directed attempt to cover up evidence of corrupt sales practices." 2025 !C12 !C24 !CCAT !GCAT !GCRIM Pitt-Des Moines Inc said Friday it is reviewing the two-count indictment handed down by the U.S. Department of Justice regarding a 1993 accident in which two workers were killed. On Thursday, a grand jury charged Pitt-Des Moines with violating safety regulations. On November 3, 1993, crews from the company were erecting the fifth floor of Chicago's new U.S. Postal Service Facility when a portion of the building collapsed. Five other workers were injured. PDM said it would be premature to comment further until it has had a chance to review the indictment completely. --Chicago newsdesk, 312-408-8787 2026 !C12 !CCAT !GCAT !GCRIM A law firm that has been the tobacco industry's first line of defense for more than 40 years said on Friday that it would vigorously attack recent lawsuits filed against it. A spokesman for the Kansas City, Mo., firm of Shook, Hardy & Bacon LLP categorized the recent tobacco-related lawsuits as "frivolous and utterly without foundation." On Thursday, Oklahoma became the 14th state to sue the tobacco industry to recoup costs of treating sick smokers. But Oklahoma was the first of the 14 states to add Shook, Hardy to the list of defendants. Individual plaintiffs in New York and New Jersey have also filed suit against the firm. "These claims have no substance whatsoever," said Patrick McLarney, the firm's managing partner. "They have been made solely for the purpose of trying to interfere with SHB's longtime representation of its tobacco company clients." 2027 !GCAT !GODD At age 99, Edith Haisman has seen plenty and lived through a lot. But the oldest living survivor of the Titanic disaster cannot bring herself to look over the side of a ship, even 84 years after the tragedy. Haisman was packed and ready to set sail on Friday on board a cruise ship to visit the site of the sunken ship and witness efforts to pull a giant slab of its hull from the bottom of the Atlantic Ocean. The fragile great-great-grandmother, who travels in a wheelchair and is accompanied on her journey by daughter Dorothy Kendle, planned to throw a wreath into the ocean in honor of her father, one of 1,500 people who died in the April 14, 1912, tragedy. "I don't know what she'll feel until we get there," said Kendle, who acts as her mother's spokeswoman. "But I do know she won't look over the side of the boat. She never does." Haisman, just 16 at the time the Titanic struck an iceberg and sank, survived by climbing on board a lifeboat. Her father was never found. "She's finally laying him to rest," said Kendle of her mother, who lives in a nursing home in Southampton, England. The "Titanic Recovery Cruise" has been organized by RMS Titanic Inc., a New York-based company that has the exclusive rights to retrieve artifacts from the sunken ship. One of the excursion's ships was setting sail from New York on Friday, the other was scheduled to depart from Boston on Sunday. More than 1,700 passengers, including Princess Elletra Marconi, granddaughter of the inventor of the wireless radio that transmitted the first-ever SOS when the 882-foot (268-metre) long Titanic was sinking, are paying $1,500 and upwards to participate. Heisman and two other survivors, 88-year-old Michel Navratil, a retired professor from France, and Eleanor Shuman, an 86-year-old Illinois resident, are the guests of honor. The nine-day cruise will feature Titanic-related film screenings and lectures and an exhibit of artifacts since the shipwreck was discovered in 1985, such as dishes, corked bottles of champagne and portholes. Chefs even plan to cook up dishes served on the original trip. On Aug. 28, passengers will witness the first attempt to raise part of the sunken ship, coordinated by France's oceanographic institute, INFREMER. RMS Titanic hopes to use the recovered 20-tonne slab of the hull as the centerpiece of an exhibition next spring. The company is also in discussions to establish a fully-fledged Titanic museum. "We want to create a visible and tangible perception of the ship in an enlightening and dignified manner that respects those who perished," said RMS spokeswoman Alexandra Foley. Some experts, however, voice skepticism about the company's motives. "It is as if a fleet of tractors had plowed the battlefield of Gettysburg," Robert Ballard, one of the scientists who discovered the wreck, told the newspaper USA Today. "It's scarred the site for many years to come." Company representatives point to scientific evidence that the remaining ship debris could be completely absorbed by microorganisms in as little as two decades from now. "We have to think about a hundred years from now," said Foley. "This story is part of our global consciousness." One of the excursion's most avid supporters is William MacQuitty, producer of the acclaimed Titanic movie, "A Night to Remember." He too will be a guest aboard the cruise ship. Belfast-born MacQuitty, 91, has devoted his life to immortalizing the story of the doomed cruise liner. "When I came to New York in 1958 with my movie, nobody went to see it because there were no stars in it," he said. "I had to explain the ship was the star." Now the danger is overkill. In November, CBS will air a four-hour mini-series entitled "Titanic," and next summer 20th Century Fox plans to release a $100 million epic on the ship. The U.S.-based cable Discovery Channel, NBC television network and Britain's Channel Four all plan to release documentaries about the recovery mission. 2028 !C13 !C22 !CCAT !GCAT !GHEA The U.S. Food and Drug Administration said Friday it had granted accelerated approval to Ares-Serono for use of its Serostim drug against AIDS-wasting weight loss in HIV-infected patients. Results of a clinical trial showed the human growth hormone increased lean body mass by an average 1.6 kg compared to placebo-treated patients, it said in a statement. Severe lean body mass loss, common among AIDS patients, leads to muscle weakness, organ failure and often to death. 2029 !C13 !C21 !CCAT !GCAT !GDIS !GENV !GPOL The California state Senate approved legislation Friday that was expected to clear the way for final passage next week of the $10.5 billion California Earthquake Authority plan. The Senate approved a so-called "trailer" bill containing amendments smoothing over differences between insurance companies and homeowner groups. The bill passed by 32-to-0. "These are the final amendments to make it (the authority) financially feasible," said Republican Senator John Lewis from Orange County. "It is voluntary for the insurance companies and it is voluntary for the consumers." The proposed $10.5 billion earthquake authority stalled in the state Senate in July after concerns were raised the legislation was not consumer-friendly enough and homeowners in the San Francisco Bay area were being asked to pay too much. The authority was proposed as part of a plan to help solve the state's homeowners insurance crisis. Senate President Pro Tem Bill Lockyer, D-Hayward, who in July had held up approval of the authority plan, said Friday that the authority, with the amendments, could become a model for the nation in dealing with disasters. The trailer bill called for a more scientific approach to setting earthquake insurance rates. The bill also required that the insurance industry retain its contingent liability for 12 years. Originally, the industry was expected to retain its contigent liability for 10 years. As part of the $10.5 billion authority, about $1.5 billion would be raised through the sale of so-called "catastrophe" bonds that would be issued through the state. "It doesn't take care of all the problems for the policy holders and the insurance industry," said Senator Charles Calderon, the newly elected Senate Democratic majority leader. But Calderon added, "It provides certainty for the policy holders and the industry. For the homeowners' market, it provides stability. Equivalent rates for equivalent risk will prevail." Some lawmakers were still somewhat concerned by the plan. Senator Quentin Kopp, an Independent from San Francisco, said he was concerned rates in the San Francisco area would still be higher than other regions despite the amendments. The state Assembly, which has already approved the main California Earthquake Authority legislation, was expected to act on the trailer bill early next week. The Senate would take up the main legislation creating the authority once the Assembly approved the trailer bill. 2030 !C12 !C15 !C152 !CCAT !GCAT !GCRIM Philip Morris Cos Inc and other tobacco shares have been hammered by mounting litigation and increasing U.S. oversight, but their oversold condition does not provide a buying opportunity yet, analysts said. "There are no valuation arguments to buy the stocks at these prices. It might be a trader argument, but the fundamentals scare me away," said Paul Rabbitt, an Oppenheimer quantitative analyst. The group has a "weak/neutral valuation. It's very cheap on dividend but very expensive on cash flow." Philip Morris was up 7/8 to 86-3/4 Friday afternoon, but still a far cry from the 106 level it was trading at two weeks ago, when a Florida jury ruled against the industry in a lawsuit and triggered a sell-off. Wall Street is now awaiting the verdict in a key tobacco litigation case in Indiana. Meanwhile, President Clinton Friday endorsed a Food and Drug Administration plan and approved rules to curb teen-age smoking by restricting the sale and advertising of tobacco. With the negative fundamental overhang, technicians did not yet see a bottom for the group. "There is zero reason to buy Morris technically," said Ralph Bloch of Raymond James. "There's no sign of a bottom yet. Morris has broken down badly and is trying to find support but it's very, very early. We need a lengthy period of rebuilding," he said. Likewise, Ed Nicoski, a Piper Jaffray technical analyst, said, "Tobacco is not technically appealing. There are too many other places to invest. Tobacco has too many problems in terms of lawsuits." Nonetheless, some traders noted Morris was attracting some bargain hunters because of its $1 a share quarterly dividend and hopes for a dividend increase next week. "Morris might raise its dividend next week. It's a 4.6 percent yield now, and the yield could be 5.5 percent. There's some bargain-hunting, but it might be early," said Marty Kearney, a trader at PTI Securities. Among other tobacco stocks, RJR Nabisco Holdings Corp, parent of R.J. Reynolds Tobacco, rose 1/4 to 25-1/2, Loews Corp added 1/2 to 75-5/8 and smokeless tobacco maker UST Inc was unchanged at 30-3/4. -- Wall Street desk, 212-859-1731 2031 !C13 !C21 !CCAT !GCAT !GENV The U.S. Environmental Protection Agency said on Friday it had approved emergency use through September of the pesticide pyridaben to get rid of mites on apples in Delaware, New Jersey and Virginia. The action marked the EPA's first decision on use of a pesticide under the new standards of the Food Quality Protection Act signed into law earlier this month. The new law sets health-based standards for permissible levels of pesiticide residues in food, and calls for the EPA to set maximum allowable levels when it grants emergency uses. Pyridaben "will pose no significant risk to consumers," EPA said. 2032 !C13 !C15 !C152 !C21 !CCAT !GCAT !GHEA Interneuron Pharmaceuticals Inc said Friday it would change the warning label on its Redux obesity drug in response to new data showing weight-loss drugs pose a greater risk of a potentially fatal lung disorder than previously believed. The original label said that an estimated 18 of every one million people who took obesity drugs for more than three months were at risk of contracting the disorder, known as primary pulmonary hypertension. Interneuron said a recalculation of the estimate by American Home Products Corp, which markets Redux, found that 23 to 46 people per million were at risk. The incidence of the disorder in the general population is one to two people per million, it said. Interneuron spokesman Bill Boni said the Redux label would be changed to reflect the updated information. He said the study concerned "a class of drugs," not just Redux. He also said the study indicated that obesity "in and of itself" predisposes a person to primary pulmonary hypertension. Thus, it may be difficult to differentiate between those who contract the disease because they are overweight and those who contract it due to use of obesity drugs, Boni said. The original label for Redux was issued when the drug was approved in April. The wording for a revised label has not been approved yet by the Food and Drug Administration. Reports of the change in the label appear to have had a positive effect on Interneuron's stock and that of Jenny Craig Inc, a weight-loss chain that uses Redux. "It's a resolution in the face of uncertainty," said David Crossen, an analyst with Montgomery Securities. "What we know is the FDA is allowing the company to reflect the change without raising the ante that would require a black box." On Friday afternoon Jenny Craig's stock was at 11-3/8, up 1/8. Interneuron stood at 28-3/4, unchanged, after being up a full point earlier in the day. 2033 !C17 !C173 !C18 !C181 !CCAT !GCAT !GENT The management-led buyout group that won the bidding for Metro-Goldwyn-Mayer film studio with a $1.3 billion bid is shopping an $800 million loan package to fund the acquisition and provide working capital. Sources close to the group, which includes billionaire Kirk Kerkorian's Tracinda Corp and Australian Seven Network Ltd, said $450 million of the amount would be used to help fund the deal with $350 million going for operations. The studio mailed prospectus to bankers on Thursday and is inviting interested parties to the studio Tuesday for presentations, sources said. Led by MGM Chairman Frank Mancuso, the acquisition group is asking for commitments by mid-September, after which it expects to close the acquisition on Oct. 1. In addition to the loan, the buyout is being financed through equity and debt investments by the partners. Once the deal is complete, investors plan to infuse additional capital to boost MGM's film production slate. Financial analysts believe the studio, which has struggled financially since French bank Credit Lyonnais assumed control in 1992, needs $500 to $600 million to run at full speed. 2034 !C12 !C18 !C181 !CCAT !GCAT !GCRIM PXRE Corp and Transnational Re Corp entered a tentative agreement to settle a putative class-action lawsuit regarding their proposed merger, the reinsurance companies said in a joint statement Friday. The agreement in principle is subject to the execution of mutually satisfactory settlement documentation, confirmatory discovery, court approval and other conditions, the companies said. Under the merger agreement, each share of Transnational common stock will be exchanged for 1.0575 shares of PXRE stock and cash in lieu of fractional shares. The lawsuit was filed on May 15, the companies said. 2035 !C12 !C13 !CCAT !GCAT !GCRIM Three Canadian citizens were ordered to pay $1.4 million in penalties for their alleged role in manipulating the stock of a startup oil and gas company, the Securities and Exchange Commission said Friday. The amount represents illegal profits plus prejudgment interest on shares of Fairmont Resources Inc, of Calgary Alberta, which the defendants sold in the spring of 1993, the SEC said. The SEC said defendants Robert Shull, 39, Leonard Fiessel, 59, and Colleen Fiessel, 50, sold the shares at a profit of about $1.0 million after allegedly creating an appearance of an active market for Fairmont stock. In his order, Federal Judge Robert Keeton required Shull to pay $667,770, Leonard Fiessel, $560,612 and Colleen Fiessel, $139,602. The SEC said Shull consented to the order without admitting or denying the SEC's allegations while default judgments were entered against the Fiessels. They were ordered not to make any further violations of U.S. securities laws. The SEC said that in their scheme, Shull and the Fiessel couple, who became majority stockholders of Fairmont in 1992, allegedly paid $600,000 in kickbacks to a stock promoter and five brokers from the Boston area to push the stock. The brokers allegedly sold more than one million Fairmont shares and the stock soared to C$3.05 from C$0.30 in a six-month period in 1993. Shull and the Fiessels are residents of Osoyoos, British Columbia, but at the time of the alleged manipulation, the Fiessel couple lived in Las Vegas. Shull is president of a public relations firm in Osoyoos while Leonard Fiessel worked in the securities industry in British Columbia until 1988, when he was sanctioned by the Vancouver Stock Exchange for manipulating a penny stock, the SEC said. His wife was a broker until 1991, when she was suspended for 15 years for unauthorized trading, the SEC said. The stock promoter and the five Boston-area brokers had been previously ordered to return the kickbacks they received and had been barred from the securities industry. Three of the brokers had also pleaded guilty to criminal securities fraud charges. Fairmont, which was not accused of any wrongdoing in the case, changed its name to Endeavour Resources Inc in January. An Endeavour spokesman said that Colleen Fiessel still owns 75,000 shares while Shull and Leonard Fiessel no longer own shares in the company (corrects which defendant still holds shares in the company). 2036 !C12 !CCAT !GCAT !GCRIM Burlington Northern Santa Fe Corp said on Friday the city of Auburn, Wash., filed a lawsuit against the railroad to prevent it from reopening the Stampede Pass line. The company said the lawsuit, filed in King County Superior Court, was an attempt to force it to pay more than public policy required for points where city streets crossed the railroad's property. The railroad said reopening the line was crucial for commerce in the state because of its links to ports. Burlington Northern said its officials have been meeting with Auburn officials for several months in an effort to deal with grade-crossing issues. The railroad said it would continue to work with local and federal officials to reach a solution. City officials were not immediately available for comment. Burlington Northern said it was continuing its repairs and upgrade of the Stampede Pass line and expected to operate one or two trains over the route by the end of the year. 2037 !C17 !C23 !CCAT !GCAT !GHEA Diatide Inc said on Friday it was awarded a $356,236 research grant from the National Institutes of Health for continued development of imaging agents to be used in detecting blood clots. The agents may improve the finding and verifying of blood clots in the lungs (pulmonary embolism), a condition that causes more than 100,000 U.S. hospital deaths annually, the company said. The same agents may also help detect blood clots in arteries, including the carotid arteries, which provide blood to the brain. 2038 !GCAT !GWEA Hurricane Dolly is currently located near 21.6N/96.5W or just off the coast of Tampico, Mexico. Dolly is packing winds of 75 mph and is expected to moke landfall within the next 6 hours. A hurracane warning is in effect form Veracrus to La Pesca Mexico. Heavy rains of 6-12 inches and high winds can be expected for the western coast of Mexico. Flash flooding and mudslides will be a possibility. Tropical Storm Edouard continued to churn in the Atlantic near 14.0N/38.0W and has winds of 58 mph. This storm is moving off to the west at 16 mph and is expected to continue on this track for at least the next 24 hours. It is also expected to reach hurricane strength by Saturday evening. This system only threatens shipping at this time. Tropical Storm Orsom conitnues to drift over open waters near 23.8N/142.3E in the Pacific. This storm will be a moderate threat to shipping as it packs winds of 63 mph. Orson is expected to intensify into a typhoon by Saturday morning. Tropical Storm Piper will, also, only be a threat to shipping as it is located well out into the Pacific near 29.4N/160.5E. Winds are 40 mph and the storm is expected to slowly drift off to the north and strengthen over the next 48-72 hours. 2039 !GCAT !GCRIM Britain's interior minister has ordered a halt to the early release of hundreds of prisoners due to be freed following an embarrassing blunder by their jailers. Home Secretary Michael Howard challenged new guidelines from the prison service authorising the early release, saying the law was not clear and should be decided in court. "The best thing to do is to suspend the release of the prisoners until we have an authoritative decision by the court," he told BBC television late on Friday. Howard had earlier said that many inmates might be entitled to compensation for having been kept too long behind bars. A legal challenge brought by inmates last year led to a ruling by Britain's court of appeal that the prison service was miscalculating the time due to be served by many prisoners given consecutive sentences for a number of offences. For instance, a prisoner who spent a month in a remand centre before trial, and was then given three consecutive sentences, should have the total period he had to serve in jail reduced by three months, not one, it ruled. The prison service had only just started to act on this ruling and this week released 45 inmates from three jails. Some ex-prisoners complained on Friday that they had not been prepared for their release and had no idea of how to cope with their unexpected freedom. The Times newspaper said prisoners who had spend an excessive amount of time in jail could receive 95 pounds ($147) a day in compensation for the blunder. The bill for the taxpayer could thus run into millions of pounds. The bungling is a further blow for Howard who has been embarrassed in the past year by a string of adverse court rulings and by critical inquiries into break-outs from two top high-security prisons. Late last year Howard dismissed the head of the prison service, Derek Lewis, after Lewis had criticised him for interfering in the day-to-day running of jails. 2040 !GCAT Following are some of the major events to have occurred on August 30 in history. 30 B.C. - Cleopatra, Queen of Egypt, died. She is said to have committed suicide by allowing an asp to bite her breast. 1125 - Lothair II, Duke of Saxony, was elected king of the Germans. 1483 - Louis XI of France died and was succeeded by Charles VIII. 1757 - Russia defeated the Prussians at Gross Jagersdorf In the Seven Years War. 1797 - Mary Shelley, English novelist, born. Author of "Frankenstein", she was the wife of the poet Percy Bysshe Shelley. 1862 - The second battle of Bull Run took place in the U.S. Civil War. Confederate forces under General Stonewall Jackson defeated the Federal army. 1881 - Clement Ader patented the first stereophonic sound system in Germany. 1896 - Raymond Massey, Canadian-born character actor, born. His early career was marked by his portrayal of Abraham Lincoln in both stage and screen versions of "Abe Lincoln in Illinois". 1914 - One of history's great military disasters took place at the Battle of Tannenberg. The Russian Second Army under Samsonov was enveloped and crushed by the Germans, who lost 30,000 men. Samsonov committed suicide. 1916 - Turkey declared war on Romania. 1918 - Lenin, new leader of Soviet Russia, survived an assassination attempt by a social revolutionary. 1924 - Diplomats in London signed the Dawes plan, an agreement calling for payment of reparations by Germany to her former enemies in World War One. 1928 - Jawaharlal Nehru founded the Independence of India League to work towards freedom from British rule. 1932 - Hermann Goering was elected president of the German Reichstag. 1940 - Sir J.J. Thomson, English physicist who discovered the electron in 1897, died aged 83 and was buried near Isaac Newton in the nave of Westminster Abbey. 1957 - Senator Strom Thurmond of South Carolina set a new filibuster record in the U.S. Congress when he spoke for over 24 hours against a civil rights bill. 1963 - A "hot line" link between the Kremlin and the White House went into operation, designed to reduce the risk of accidental war and reduce sudden East-West tension. 1973 - Kenya banned the hunting of elephants and the trade in ivory. 1981 - President Mohammad Ali Rajaei and Prime Minister Mohammad Javad Bahonar of Iran were killed in a bomb blast. 1982 - PLO leader Yasser Arafat abandoned his headquarters in Beirut following Israeli invasion of Lebanon. 1983 - Lt-Col Guion Bluford became the first Afro-American in space, one of a crew of five on the space shuttle Challenger. 1990 - The Bulgarian parliament approved Andrei Lukanov as prime minister. 1991 - Azerbaijan declared independence from the Soviet Union. 1993 - Businessman Robert Malval was sworn in as Haiti's new prime minister. 1994 - Bosnian Serbs overwhelmingly rejected an international peace plan in a weekend poll with the final result showing more than 90 percent of those who voted said "No". 2041 !C23 !CCAT !GCAT !GHEA Hoechst Marion Roussel said on Friday it was preparing to conduct a trial of Cardizem CM, a drug used to treat high blood pressure which the Lancet medical journal reported may increase the risk of cancer. Earlier on Friday the Lancet published research by Dr Marco Pahor of the University of Tennessee in Memphis which found that people who had been using these so-called calcium channel blockers were 70 percent more likely to develop cancer. In a commentary the Lancet said randomised trials should be organised immediately but that "industry is likely to baulk at this suggestion on grounds of cost". However, Hoechst Marion Roussel, a unit of Hoechst AG, said it was already preparing to conduct a large-scale, four-year controlled trial of Cardizem to evaluate the long-term effects on patients being treated for high blood pressure before the Lancet report. "More than 8,000 people with high blood pressure will be enrolled in the trial and followed for four years. Among study end points, new-incident cancer will be recorded as part of the study design," the pharmaceutical company said in a statement. The statement said patients should not be alarmed by the Lancet report and the company said it stood behing its products. "In fact, the National Institutes of Health cautions that the dangers of uncontrolled high blood pressure may outweigh any possible cancer risk seen by this study," the statement said. It said the authors of the report had concluded the evidence of their study was insufficient to recommend withdrawal of treatment, adding that clinical trials since the introduction of Cardizem in 1982 had produced no clinical evidence to suggest a causal relationship between the drug and cancer. Other sellers of such calcium channel blockers are Pfizer Inc, Bayer AG and Astra Merck Inc, a joint-venture between Merck and Co and AB Astra . -- London Newsroom +44 171 542 7717 2042 !GCAT !GSPO Saeed Anwar not out 116 Aamir Sohail c Cork b Croft 46 Ijaz Ahmed not out 58 Extras 9 Fall of wicket - 1-106 To bat - Inzamam-ul-Haq, Salim Malik, Asif Mujtaba, Wasim Akram, Moin Khan, Mushtaq Ahmed, Waqar Younis, Mohammad Akam England 326 all out 2043 !GCAT !GSPO A controversial redraw of the U.S. Open men's singles has pitted Australians Mark Woodforde and Mark Philippoussis against each other in next week's first round. Bowing to pressure and harsh criticism from irate players who suggested the draw could have been manipulated to help popular American players, the U.S. Tennis Association (USTA) on Thursday erased the earlier draw and did it all over again. The USTA was within the rules in departing from the ATP Tour rankings in choosing the 16 seeded men, and in the revised draw still did not bow to pressure to stick to the rankings. But by placing the 112 non-seeded players in their slots before announcing the 16 seeds in the first draw on Wednesday, the tournament left itself open to charges of cheating. Outspoken world number two Thomas Muster and an outraged Andrei Medvedev led the protests. "They abused the rules. It would be like fixing a football, basketball or NHL game," said Medvedev, who had suggested the players boycott the event unless the draw was re-done. Muster, who along with French Open champion Yevgeny Kafelnikov was seeded below his ranking, also charged that the eighth-ranked Andre Agassi was seeded sixth so he could not run into world number one Pete Sampras as early as the quarter-finals. Agassi had been on course for a semifinal showdown with Sampras. In the new draw the pair cannot meet until the final. Woodforde was drawn against a qualifier in the second half of the original draw, leading to a probable early meeting with second seed Michael Chang. Philippoussis was originally to have played Spain's Alex Corretja. The winner of the revised first round match between the two Australian Davis Cup team-mates will be on course for a third round meeting with Pete Sampras, whom Philippoussis beat at the Australian Open last January. Woodforde's Olympic gold medal doubles partner Todd Woodbridge profited from the redraw. Originally to have played Martin Damm of the Czech Republic, Woodbridge finds himself up against a qualifier. Sandon Stolle also benefited, moving from a match against 11th seed MaliVai Washington to a meeting with lower-ranked American Jim Grabb. Pat Rafter will play Kenneth Carlsen of Denmark while Jason Stoltenberg meets Stefano Pescosolido of Italy. If successful in those matches the two Australians will meet in the second round. -- Sydney Newsroom 61-2 9373-1800 2044 !GCAT !GSPO World number one golfer Greg Norman has sacked his coach Butch Harmon after a disappointing season. "Butch and I are finished," Norman told reporters on Thursday before the start of the World Series of Golf in Akron, Ohio. Norman, a two-time British Open champion, parted ways with his long-time mentor after drawing a blank in this year's four majors, winning two tournaments worldwide. The blonde Australian opened with a level par round of 70 in Akron, leaving him four shots adrift of the leaders, Americans Billy Mayfair and Paul Goydos and Japan's Hidemichi Tanaki. On Wednesday Norman described this year as his worst on the professional circuit since 1991, when he failed to win a tournament. "My application this year has been strange," Norman said. "Maybe I haven't been as keyed up as I should have been." "Sometimes you don't have it in your head to play. Maybe this was one of those years where I was there, but I wasn't 100 percent there, and you have to be 100 percent to perform," he said. --Sydney Newsroom 61-2 9373-1800 2045 !GCAT !GSPO Wayne Riley and Peter Senior will fight it out for the last remaining place in the international team for next month's President's Cup against the U.S. after Japan's Masashi "Jumbo" Ozaki confirmed he would play. Earlier this week, international non-playing captain Peter Thomson named the Australian pair as his two nominated players if Ozaki decided against taking up his automatic invitation. But Ozaki, the world number six ranked player, has agreed to join the team, leaving only one place still to fill. The 12-man international team features the best players outside Europe and will face the Americans in the Ryder Cup-style team event in Washington from September 13-15. "Great for the team, great for everybody," world number one Greg Norman said, referring to Ozaki's decision. "Obviously it's good news for the President's Cup," the Australian told reporters after his first round at the World Series of Golf in Akron, Ohio. --Sydney Newsroom 61-2 9373-1800 2046 !GCAT !GSPO For the first time in Israeli history, an Arab team will take the field when the National League soccer season starts on Saturday. Hapoel Taibe fields four Jewish players and two foreign imports -- a Pole and a Romanian. The rest of the side is made up mainly of Moslem Arabs. The club, founded in 1961, has a loyal following in Taibe, an Arab town of 28,000 in the heart of Israel. But away from their home ground, they face unfriendly crowds who taunt the players with racist abuse. "The very first thing we thought about after we knew we would be promoted was the game against Betar Jerusalem," said Taibe supporter Karem Haj Yihye. Two weeks ago Taibe, coached by Pole Wojtek Lazarek, met Betar, a club closely associated with the right-wing Likud party, for the first time in a Cup match in Jerusalem. Chants from the crowd of "Death to the Arabs", and bottle-throwing during the game marred the match which ended in a goalless draw. One Taibe supporter required hospital treatment for cuts and bruises after a stone struck his head as he was driving from the stadium. "We're used to hearing the taunts of "Death to the Arabs'," said Sameh Haj Yihye, a Taibe resident who studies at Jerusalem's Hebrew University. "But we know that these are only words, nobody has died from hearing them and it only makes us support our team more vehemently." The dusty town of Taibe lacks the amenities of Jewish communities and many Israeli Arabs have long complained of state discrimination. "There are no parks or empty areas of land around here, so when we want to play a friendly game of soccer we all load up in the car and travel to Tel Aviv," 60 km (36 miles) away, Sameh Haj Yihye said. The town's ramshackle 2,500-seat ground is accessible only by two dirt tracks. "We plan to build a 10,000-seat stadium, but it may well be situated elsewhere," said club chairman Abdul Rahman Haj Yihye. "We will discuss this with the mayor and hopefully a new or refurbished ground will be completed by the start of the new year." In the meantime, Taibe will play all their heavily policed home matches at the Jewish coastal town of Netanya. "We are Israelis, there is no question about that," said Karem Haj Yihye, a hotel waiter. "We don't have any connection with the Palestinians, they live over there," he said, pointing to the West Bank seven km (four miles) to the east. "We don't feel our club represents Palestinian Arabs," said club chairman Abdul Rahman. "We are trying to do all we can to run a professional outfit, we are pleased at any support we get, but do not go out looking to represent the whole Arab world." 2047 !GCAT !GSPO Two players have withdrawn from the Republic of Ireland squad for the 1998 World Cup qualifying match against Liechenstein on August 31, the Football Association of Ireland said in a statement on Friday. The F.A.I. statement said that Liverpool striker Mark Kennedy and Chelsea defender Terry Phelan were both receiving treatment for injuries and would not be travelling to Liechenstein for the game. No replacements had been named. -- Damien Lynch, Dublin Newsroom +353 1 6603377 2048 !GCAT !GSPO European champions Juventus will face English league and cup double winners Manchester United in this season's European Champions' League. The draw made on Friday pitted Juventus, who beat Dutch champions Ajax Amsterdam 4-2 on penalties in last year's final, against Alex Ferguson's European hopefuls in group C. The other two teams in the group are last season's Cup Winners' Cup runners-up Rapid Vienna and Fenerbahce of Turkey. Juventus meet United in Turin on September 11, with the return match at Old Trafford on November 20. United have dominated the premier league in the 1990s, winning three English championships in four years, but have consistently failed in Europe, crashing out of the European Cup to Galatasaray of Turkey and Spain's Barcelona at their last two attempts. They have not lifted a European Trophy since 1991 when they beat Barcelona in the Cup Winners' Cup final, and their one and only European Cup triumph was way back in 1968, when they beat Benfica of Portugal 4-1 at Wembley. Juventus have won the European Cup twice. Before conquering Ajax last year they beat United's big English rivals Liverpool in the ill-fated 1985 final in the Heysel stadium in Brussels. 2049 !GCAT !GSPO Rolf Fringer has replaced Artur Jorge as coach of the Swiss national soccer team but it's Englishman Roy Hodgson's shoes he will have to fill. Under Hodgson, Swiss football was transformed into a respected force as he guided the tiny Alpine nation to the World Cup finals for the first time in 20 years in 1994 and two years later to its first appearance in the European championship. Swiss fans expected much from Jorge when he took over from Hodgson last December after the popular Briton left to coach Inter Milan. Now, after Jorge's turbulent and brief seven-month tenure, those same expectations have fallen on Fringer. "This will certainly be a difficult challenge," said Fringer after signing a contract to mid-1998. "Each trainer has his own personality. While my style may be more like Hodgson's then Jorge's, I still have my own way." Fringer's signing was a matter of urgency. Switzerland's first 1998 World Cup qualifying match is on August 31 against Azerbaijan in Baku. Fringer, 39, an Austrian-born Swiss, spent his career playing and coaching in Switzerland until he joined VfB Stuttgart in July 1995. The club finished a disappointing 10th in the German Bundesliga last season, prompting calls for his dismissal. Fringer's strength, however, lies not in his record but his intimate knowledge of the Swiss game, its nuances and his ability to bridge the country's gaping language divides. It was that lack of understanding that ultimately caused Jorge's demise. Seen as intellectual and aloof, Jorge, whose coaching pedigree includes a champions' league title and European coach of the year, never came to terms with the multi-cultural Swiss game. The relationship was further soured by a poor performance at the European championship where Switzerland failed to win a game and advance beyond the group stage. Having compiled an uninspring record of 1-2-4, Jorge was released from his contract in July allowing him to go back to his native Portugal. It remains to been seen if Fringer can return the Swiss to the heady days it enjoyed under Hodgson. For the moment it would probably be enough to make people forget about the problems of the last few months. "I see great potential," said Fringer, whose upbeat personality has been described as magnetic. "Switzerland has confirmed its worth and we have good young talent." His appointment has already marked the return of striker Adrian Knup, one of Switzerland's most experienced internationals. Veteran defender Yvan Quentin said of Fringer: "Considering the short time before the qualifications start it was the right decision." But he added: "People must not start to cry if results don't come right away." 2050 !GCAT !GPOL ROMANIA GOVERNMENT LIST (960823) ************************************************************* * 3 Nov 96 - Parliamentary & presidential elections * * expected. * ************************************************************* - - - - - - President (Sworn in 30 Oct 1992 for four-year term)............................Ion ILIESCU Economic Adviser to President..................Misu NEGRITOIU - - - - - - - PARTY OF SOCIAL DEMOCRACY OF ROMANIA (PDSR)-LED GOVERNMENT (Sworn in 20 Nov 92, reshuffled 23 Aug 96) Prime Minister (Appointed 4 Nov 1992)........Nicolae VACAROIU - - - - - - - MINISTERS OF STATE: Economic Reform..................................Mircea COSEA Finance......................................Florin GEORGESCU Foreign Affairs.......................Teodor Viorel MELESCANU Labour & Social Security...................Dan Mircea POPESCU - - - - - - - MINISTERS: Agriculture & Food Industry....................Valeriu TABARA Communications............................Ovidiu Ioan MUNTEAN Culture......................................... . Grigore ZANC Defence........................................Gheorghe TINCA Education......................................... Liviu MAIOR Environment, Forestry & Water........... Aurel Constantin ILIE Health......................................... Daniela BARTOS Industry...................................Alexandru STANESCU Interior...................................Doru Ioan TARACILA Justice............................... Iosif Gavril CHIUZBAIAN Parliamentary Relations.......................... Petre NINOSU Public Works.................................... Marin CRISTEA Research & Technology..................... Doru Dumitru PALADE Tourism.................................... . Matei Agathon DAN Trade........................................Dan Ioan POPESCU Transport......................................... Aurel NOVAC Youth & Sports..............................Alexandru MIRONOV - - - - - - - Central Bank Governor.......................... Mugur ISARESCU - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End Government List) 2051 !GCAT !GPOL SAO TOME AND PRINCIPE GOVERNMENT LIST (960823) ************************************************************* * 22 Aug 96 - The Supreme Court confirmed the re-election of* * of President Miguel Trovoada in the July 21 * * runoff vote. Trovoada won 52.74 percent, his * * rival Manuel Pinto da Costa took 47.25 * * percent. * ************************************************************* - - - - - President (Re-elected 21 July 96).............Miguel TROVOADA (Re-elected 21 July 96 for a second five-year term) - - - - - - MULTI-PARTY GOVERNMENT (Apptd 5 Jan 96) Prime Minister (Apptd 29 Dec 95)...... . Armindo Vaz de ALMEIDA - - - - - - - MINISTERS: Agriculture and Fisheries................ . Julio Lima de SILVA Defence & Internal Security. . Carlos Paquete Carneiro de SILVA Education, Youth & Sport..................Guilherme OCTOVIANO Employment and Social Security.........Albano Germano de DEUS Finance & Planning..............................Rafael BRANCO Foreign Affairs & Cooperation...... . Guilherme Posser da COSTA Health.............................Fernanda Roncon de AZEVEDO Industry, Trade and Tourism.........Arlindo de Ceita CARVALHO Justice, Administrative Reform & Local Government............. Gabriel Ferreira da COSTA Media and Culture...............Ladislau Frederico de ALMEIDA Social Infrastructure & Environment..............Alcino PINTO - - - - - - - Central Bank Governor...................Adelino CASTELO David - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End government list) 2052 !GCAT !GPOL RUSSIA GOVERNMENT LIST (960823-2) President.......................................Boris YELTSIN (Re-elected 3 July 96 for a four-year term, sworn in 9 Aug 96) - - - - - - - CABINET OF MINISTERS (appointed 15 Aug 96): Prime Minister (Re-apptd Aug 10 96)...... Viktor CHERNOMYRDIN First Deputy Prime Minister................ . Alexei BOLSHAKOV First Deputy Prime Minister..................Viktor ILYUSHIN First Deputy Prime Minister................ . Vladimir POTANIN Deputy Prime Minister..................... . Vladimir BABICHEV (Also Head of Government Administration) Deputy Prime Minister.......................... . Oleg DAVYDOV (Also Minister of Foreign Trade) Deputy Prime Minister..................... Alexander LIVSHITS (Also Finance Minister) Deputy Prime Minister...................Alexander ZAVERYUKHA Deputy Prime Minister.......................Vitaly IGNATENKO Deputy Prime Minister.............................Oleg LOBOV Deputy Prime Minister.......................... . Valery SEROV Deputy Prime Minister........................Vladimir FORTOV (Also Chairman of State Committee for Science & Technology) - - - - - - - MINISTERS: Agriculture..................................Viktor KHLYSTUN Civil Defence and Emergencies..................Sergei SHOIGU Commonwealth of Independent States..............Aman TULEYEV Communications............................... Vladimir BULGAK Construction.................................... . Yefim BASIN Culture......................................Yevgeny SIDOROV Defence.................................... Gen Igor RODIONOV Defence Industry..................................Zinovy PAK Economy........................................Yevgeny YASIN Education..................................Vladimir KINELYOV Finance.......................................See Deputy PMs Foreign Affairs.............................Yevgeny PRIMAKOV Foreign Trade.................................See Deputy PMs Fuel & Energy.................................Pyotr RODIONOV Health.................................... . Tatyana DMITRIEVA Industry.......................................Yuri BESPALOV Interior.................................... . Anatoly KULIKOV Justice.................................... Valentin KOVALYOV Labour & Social Development................ . Gennady MELIKYAN Nationalities.......................... . Vyacheslav MIKHAILOV Natural Resources............................... Viktor ORLOV Nuclear Energy..............................Viktor MIKHAILOV Railway Communications.......................Anatoly ZAITSEV Transport......................................Nikolai TSAKH - - - - - - - Speaker of the Lower House (State Duma)....Gennady SELEZNYOV Speaker of the Upper House (Federation Council)........................Yegor STROYEV - - - - - - - Central Bank Governor.........................Sergei DUBININ - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End government list) 2053 !GCAT !GPOL RUSSIA GOVERNMENT LIST (960823) President.......................................Boris YELTSIN (Re-elected 3 July 96 for a four-year term, sworn in 9 Aug 96) - - - - - - - CABINET OF MINISTERS (appointed 15 Aug 96): Prime Minister (Re-apptd Aug 10 96)...... Viktor CHERNOMYRDIN First Deputy Prime Minister................ . Alexei BOLSHAKOV First Deputy Prime Minister..................Viktor ILYUSHIN First Deputy Prime Minister................ . Vladimir POTANIN Deputy Prime Minister..................... . Vladimir BABICHEV (Also Head of Government Administration) Deputy Prime Minister.......................... . Oleg DAVYDOV (Also Minister of Foreign Trade) Deputy Prime Minister..................... Alexander LIVSHITS (Also Finance Minister) Deputy Prime Minister...................Alexander ZAVERYUKHA Deputy Prime Minister.......................Vitaly IGNATENKO Deputy Prime Minister.............................Oleg LOBOV Deputy Prime Minister.......................... . Valery SEROV Deputy Prime Minister........................Vladimir FORTOV - - - - - - - MINISTERS: Agriculture..................................Viktor KHLYSTUN Civil Defence and Emergencies..................Sergei SHOIGU Commonwealth of Independent States..............Aman TULEYEV Communications............................... Vladimir BULGAK Construction.................................... . Yefim BASIN Culture......................................Yevgeny SIDOROV Defence.................................... Gen Igor RODIONOV Defence Industry..................................Zinovy PAK Economy........................................Yevgeny YASIN Education..................................Vladimir KINELYOV Finance.......................................See Deputy PMs Foreign Affairs.............................Yevgeny PRIMAKOV Foreign Trade.................................See Deputy PMs Fuel & Energy.................................Pyotr RODIONOV Health.................................... . Tatyana DMITRIEVA Industry.......................................Yuri BESPALOV Interior.................................... . Anatoly KULIKOV Justice.................................... Valentin KOVALYOV Labour & Social Development................ . Gennady MELIKYAN Nationalities.......................... . Vyacheslav MIKHAILOV Natural Resources............................... Viktor ORLOV Nuclear Energy..............................Viktor MIKHAILOV Railway Communications.......................Anatoly ZAITSEV Science & Technology..................................VACANT Transport......................................Nikolai TSAKH - - - - - - - Speaker of the Lower House (State Duma)....Gennady SELEZNYOV Speaker of the Upper House (Federation Council)........................Yegor STROYEV - - - - - - - Central Bank Governor.........................Sergei DUBININ - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End government list) 2054 !GCAT !GDIP Commonwealth ministers concerned about human rights in Nigeria may cancel a planned trip there because of government restrictions on their mission, Canadian Foreign Minister Lloyd Axworthy said on Friday. "The reaction of the regime there is such that many of us feel that the mission under the present circumstances shouldn't go ahead," Axworthy said. Foreign ministers of the British Commonwealth, which suspended Nigeria because of concerns about democracy and alleged human rights abuses, will meet in London on Wednesday to discuss what to do, he told a news conference. Members of the Commonwealth Ministerial Action Group had planned to visit the Nigerian capital Abuja on August 29-30. Canada has pressed for stronger action against Nigeria rather than relying mainly on fact-finding missions and dialogue, and appeared ready to press the case in the London meeting. "A lot of members were counting on this (mission) being a great breakthrough. It doesn't look like it's going to be that way. So it may be that we'll have to now consider collective action," he said, noting the impact from action taken by African states against Burundi. He said the intention had been for the members of the team not just to meet with Nigerian government officials but to do fact-finding on their own, discussing human rights and democracy with private groups. But the Nigerian foreign ministry issued a statement on Thursday saying the visit should not be construed as a fact-finding mission. One of the triggers to the international outcry against Nigeria was the execution last November of author Ken Saro-Wiwa and eight other minority rights activists on charges of murder. His brother called on Canada in an Ottawa news conference on Thursday to urge fellow Commonwealth nations to impose an oil embargo on the country, Africa's most populous nation. Axworthy said that in any case Canada was moving ahead with its own measures. He said, for example, that Christine Stewart, the junior minister who was to have gone to Nigeria, has been working with Canadian oil companies on a voluntary code of conduct regarding Nigeria. 2055 !GCAT !GDIS !GODD A Canadian couple presumed to have died in a plane crash three days ago were found alive on Friday almost by chance on a nearby beach, police said. Brian and Sheila Johnson were piloting a light plane on a sightseeing flight on Tuesday on the remote west coast of Vancouver Island when they crashed into a lake. Rescue crews later found their identification floating among the wreckage and gave up the search, presuming they had died. A Royal Canadian Mounted Police officer flew to the site at Gaultheria Lake on Friday with a coroner and divers to compile a final report on the incident. As he circled his helicopter to take pictures of the crash site, he spotted the pair on a beach about a mile (two km) away. "Both survivors were tired and exhausted but healthy," the police said in a statement. They were flown to the outpost of Port McNeill on Vancouver Island. Police spokesman Peter Montague said the Johnsons had managed to scramble out of the plane with one survival kit when it hit the water. They decided to hike to a nearby beach having seen a group of ocean kayakers as their plane went down. But their trek took them outside the area where search crews were focusing their efforts, Montague said. 2056 !GCAT !GODD About 360 adventurers from nine countries will trek glaciers, climb mountains, whitewater raft, horseback ride, canoe and mountain bike on a gruelling 300-mile (480 km) endurance race starting on Saturday in Canada's rugged wilderness. Those taking part include a 73-year-old great-grandmother, U.S. Air Force fighter pilots, bankers, students, housewives and a former fashion model. The event, called the Eco-Challenge, is part of a growing sport known as adventure racing in which competitors push themselves to their limits for days over a perilous wilderness course, finding their way by compass and barely stopping to sleep. Organisers expect about two-thirds of the participants to drop out or be disqualified before the finish. The hardy ones are expected to complete the course in about six days with first-place finishers receiving $10,000 in prize money. The Eco-Challenge has been staged twice before -- in Utah and Maine last year -- and is modelled on similar races overseas, notably the Raid Gauloises which began in France. This year the Eco-Challenge is being held in the Coast Mountains north of Vancouver on Canada's west coast, an area filled with treacherous peaks, ice fields and frigid waters. The exact location of the course is kept secret until hours before the race begins. While the endurance test may sound like hell on earth to many, it is the adventure of a lifetime for 54-year-old California finance executive Jim Newman who has trained nearly a year for the race. "You do this for the love of it ... It becomes a high point in your life," said Newman. Former British fashion model Sarah Odell has competed in seven such races from Patagonia to Borneo and finds the sport addictive. "You get moments where you are miserable ... but it's incredible. I love the competitive atmosphere." In the Eco-Challenge, competitors race in teams of five which must include both men and women. Team members must remain within 100 yards (meters) of each another at all times and finish together. With racers carrying about 40 pounds (18 kg) of gear on their backs, broken bones, sunstroke, dehydration and exhaustion are common. Organisers monitor competitors at checkpoints every 10 miles (16 km) and from helicopters. Racers also carry radios for use in emergency. While participants must be in top condition, the competition is billed as a tougher psychological test than a physical one. "The challenge of crisis management and interpersonal relationships defeats teams far sooner than the physicality of it," said Eco-Challenge founder and former British paratrooper Mark Burnett. In spite of the sport's increasing popularity, it is not without critics. Some environmentalists worry competitors may damage fragile wilderness while other opponents deride it as overly commercial because of heavy corporate sponsorship. The Eco-Challenge bills itself as environmentally friendly and its rules forbid teams from leaving behind any food, supplies or waste. That means participants must even pack out their own excrement. Teams have to pay an entry fee of $10,000. Other costs, including travel and equipment expenses, can add an extra $40,000 to the total, prompting many participants to canvass corporate sponsors. 2057 !C24 !CCAT !GCAT !GENV !M14 !M141 !MCAT The risk of frost was forecast on Friday to be slight for the northeast grainbelt Sunday and Monday mornings and slight for central Alberta's foothills next Tuesday and the following weekend, Environment Canada said. Environment Canada's 10-day frost outlook called for no frost risk anywhere on the Prairies the morning of Saturday, August 24. A slight risk of frost was forecast for Saskatchewan's northern grain belt Sunday morning. A slight risk of frost was forecast for Manitoba's Interlake region Monday, August 26. A slight risk of frost was forecast for central Alberta's foothills Tuesday, August 27 and for a wider area of the same region Saturday, August 31 and Sunday, September 1. -- Gilbert Le Gras 204 947 3548 2058 !GCAT !GPOL !GVIO The faction leader at the centre of fighting which devastated the Liberian capital in April and May pledged on Friday to fight no more wars and to work with his rivals to unite the country. Roosevelt Johnson, who spent three months in exile in Ghana after the United States flew him out of Liberia at the height of the fighting, returned home on Thursday after signing a new peace accord with other faction leaders in Nigeria. His ethnic Krahn supporters organised a prayer service on Friday at the Barclay Training Centre barracks chapel, which was damaged by shelling during the fighting. "We are committed to the document we signed in Abuja and we pray that God will touch the hearts of everyone who signed it to be the same," Johnson told the congregation. "We have come to extend an olive branch and not fight another war," he said. "We will put the past behind and have no malice against (faction leaders) Charles Taylor, Alhaji Kromah or anyone." Johnson told his supporters God had been on their side while the barracks was besieged by Taylor and Kromah's supporters with thousands of civilians trapped inside. "If you know and believe the Bible story about Moses and the children of Israel then consider that God fought your fight in this barracks. It wasn't by your own strength," he said. He announced a 20,000 Liberian dollar ($270) contribution towards repairing the damaged chapel. West African heads of state and Liberian faction leaders agreed on Saturday to appoint former Liberian senator Ruth Perry to lead the ruling council and set a timetable for disarmament by the end of January and elections on or around May 30. The latest agreement threatens faction leaders with sanctions, including seizure of assets and war crimes tribunals, if they are seen to be obstructing the peace process. Faction leaders have already accused each other of breaking a ceasefire which was supposed to come into force on Tuesday. Perry said on Thursday she would travel to Grand Cape Mount, her home county in western Liberia, to halt clashes reported there between Johnson's and Kromah's supporters. Perry, 57, was a Liberian senator during the 1980s under the government of slain president Samuel Doe. Over a dozen peace deals have failed to end the war launched by Charles Taylor and his National Patriotic Front of Liberia in late 1989. Taylor and Kromah are both vice-chairmen on the Council of State. Their attempt to arrest Johnson for murder in April triggered some of the bloodiest fighting of the war in the streets of Monrovia. Health officials estimate some 1,200 people were killed in seven weeks of fighting in the city centre. 2059 !GCAT !GDIP !GVIO Rwanda on Friday poured scorn on charges it wanted the expulsion of 1.1 million Rwandan Hutu refugees from Zaire, saying it sought an orderly, decent and well-organised return. Emmanuel Ndahiro, senior aide to Rwandan strongman and Vice-President Major-General Paul Kagame, told Reuters by telephone from Kigali that despite agreement with Zaire no time frame was set for the operation. He dismissed as "pure propaganda" charges by a Rwandan Hutu lobby group that Zaire and Rwanda planned to start a "forced and inhuman" repatriation of the refugees within the next few days. "Nobody (in Rwanda) is advocating an abrupt return of the refugees. The return should be orderly, decent and well-organised because not even powerful America can afford to take in one million people at once," Ndahiro said. In Kinshasa, a delegate of the United Nations refugee agency said an agreement between the Zairean and Rwandan prime ministers did not set a time limit for the refugees' return. Hubert Edongo Menye, UNHCR regional delegate for Central Africa, said he would meet Interior Minister Gerard Kamanda wa Kamanda on Saturday to discuss Thursday's agreement to send the refugees home. "This repatriation is a large scale operation, both costly and dangerous, which must take account of the dignity and safety of the refugees," he said. He said a joint communique issued after the prime ministers' Kigali meeting had talked about the "progressive closure" of refugee camps in eastern Zaire, an operation which he said would need the support of the international community. Menye said the communique had set no time limit, but added: "If the conditions are met, the refugees can be repatriated." The exiled Rally for the Return of Refugees and Democracy in Rwanda (RDR) appealed on Friday to the international community to help stop Zaire forcibly expelling its Rwandan Hutu refugees. The RDR, which has the support of Rwanda's 40,000-strong former Hutu army which moved into Zaire in 1994 with the refugees after Kagame's Tutsi-dominated Rwanda Patriotic Front took power, said it feared for the safety of Hutus in Rwanda. "We have a lot of fear, fear for our people. They (Rwanda and Zaire) have done it before and they will do it again. Our information is forced repatriations will start within the next few days," said RDR Executive Secretary Innocent Butare. But Ndahiro said careful planning was essential to avoid logistical problems and a humanitarian crisis. "For a million people plus, you need to plan carefully, you need to ensure they are handled decently. If you do things abruptly then you risk running into the same chaos that characterised their exit in 1994," Ndahiro said. The 1.1 million refugees in eastern Zaire are part of two million Randans who fled at the end of three months of civil war after the 1994 genocide of up to a million people by Hutus. Zairean Prime Minister Kengo wa Dondo told a news conference with his Rwandan counterpart on Thursday the operation would begin with the closure of all Rwandan refugee camps in Zaire. "The two heads of government have decided to make operational the organised, massive and unconditional repatriation of all Rwandan refugees," Kengo said in Kigali. "This is going to be carried out rapidly. The repatriation will be enormous and immediate. We are at a stage where Zaire is going to proceed with the closure of the camps," Kengo added. Asked whether he believed that Zaire, which threatened in the past to expel all the Rwandan Hutus, would keep its deal with Rwanda, Ndahiro said: "Your guess is as good as mine." "We have had several meetings with Zaire in the past...but we hope this time they will keep their word," Ndahiro said. 2060 !C42 !CCAT !E21 !E211 !E41 !ECAT !GCAT !GJOB An unprecedented strike by Zimbabwean civil servants further disrupted key social services on Friday, forcing one hard-pressed psychiatric hospital to turn some mental patients over to their families. Officials at Ingutsheni pyschiatric hospital, the country's largest, told reporters they had sent home 55 of 600 patients, and more might go, after they became hypersensitive to the arrival of stand-in staff struggling to cope with the crisis. "The situation is explosive. The patients have become hypersensitive to the change of surroundings caused by the strike and this has made them aggressive and even violent," said one official at the hospital in the southwestern city of Bulawayo. State nurses, junior doctors, mortuary attendants, magistrates and prosecutors are among thousands of public servants who defied a government threat to sack them if they persisted with a strike that began on Monday. Union officials estimate 70 to 80 percent the country's 180,000 civil servants are on strike. The strikers, emboldened by strong public support, vowed they would remain on the streets until their demands for wage rises of between 30 and 60 percent were met. The strike is a rare challenge to President Robert Mugabe and his dominant ruling ZANU-PF party, both in power since 1980. Many strikers spent Friday singing and beating drums in a central Harare park, denouncing alleged government insensitivity and angered by reports that Mugabe was on honeymoon in Cape Town after wedding his former presidential secretary Grace Marufu at a lavish ceremony last weekend. Some senior officials and MPs have broken ranks with the government to support the workers. Others have insisted that the government could not afford to back down. MPs from the ruling ZANU-PF party who usually rally behind government positions called late on Thursday for the government to meet the workers' demands, but some cabinet ministers said there was no room to back down to "mob rule". Civic organisations, opposition parties and private-sector unions have weighed in with statements of solidarity, denouncing the government for recently awarding civil servants salary increases of only up to eight percent. The Public Service Association (PSA) union rejects the offer as "an unacceptable insult" and says a majority of the southern African state's civil servants deserve more. On average, civil servants earn Z$1,000 (U.S.$99) a month and PSA union leaders justify their 60 percent pay rise demand on grounds that salaries in the public service have fallen far below the cost of living over the years. Annual inflation was 22.0 percent last month and averaged the same over the past two years. "There is no question of us going back to work before the government addresses our grievances. We are not going back and we will not respond to any threats to dismiss us," Frank Chamunorwa, vice-president of the PSA, told state radio. His comments followed a statement by Public Service, Labour and Social Welfare Minister Florence Chitauro that she had told officials to sack those who did not report for work on Friday. Chitauro told PSA executives at exploratory talks on Thursday that her government would consider their grievances seriously only when their followers returned to work. ($1 = 10.10 $Zimbabwe) 2061 !GCAT !GDIP !GVIO More than 800 Rwandan Hutu refugees returned to Rwanda on Friday, ending two years in exile and leaving only 11,000 in the last Rwandan refugee camp in Burundi. Paul Stromberg, spokesman for the U.N. High Commissioner for Refugees (UNHCR), said 825 Rwandan refugees returned to Rwanda from Rukuramigabo camp as well as 600 who left on Thursday. "That leaves fewer than 11,000 in Rukuramigabo. The bulk of the returnees went towards Butare but 50 went to (Rwanda's capital) Kigali," said Stromberg, speaking by telephone from Burundi. Rukuramigabo is the sole remaining Rwandan refugee camp in Burundi since an operation to return 50,000 refugees to neighbouring Rwanda from Magara camp was completed on Thursday. "We just have to empty Rukuramigabo and then the Rwandan refugee problem in Burundi will be over," said an aid official. "I did not move out of Burundi before because I really thought the army in Rwanda would lock me up and torture me for being a Hutu," said Dative Ngendahuriyo, sitting aboard a UNHCR bus waiting for it to start on the trip to her home commune. "There came a moment when so many people went back I just followed. That's how I decided things for the past two years," she added, sitting alongside a plastic bucket, a blanket, plastic sheeting, a sack of maize and a hoe donated by agencies. "I just seem to have been waiting in line for two years," said Athanase Murenhije at Musange transit camp near Butare. "That's all you do in a refugee camp, just wait and hear lies." Up to 6,000 returnees -- some with goats, chickens and ducks -- left Musange transit camp on Friday for their home districts to make space for a new influx from northern Burundi. The return of some 66,000 Rwandan refugees from Burundi since July is the biggest mass movement in the region since two million Rwandan Hutus flooded out of Rwanda to Tanzania, Burundi and Zaire in 1994 during three months of genocide and civil war. Many of the refugees refused to go home, saying they feared attacks in reprisal for the genocide. They changed their minds after the Tutsi-dominated Burundi army seized power on July 25. There were a total of 88,000 Rwandan refugees in four camps in Burundi in June and some 135,000 at the start of the year. Stephano Severe, head of the UNHCR office in Butare, said: "The operation has gone well and I would like to think if this happens in Zaire we could move in the same way," he said. Rwanda and Zaire said on Thursday they planned to repatriate 1.1 million Rwandan refugees in eastern Zaire in an operation that would begin immediately with closure of all refugee camps. UNHCR was not consulted about the decision and a refugee lobby group said on Friday it feared forced expulsions of Hutu refugees from eastern Zaire could start within a few days. Officials said 223 Hutu refugees who refused to leave Magara for Rwanda on Thursday spent the night in the otherwise empty camp in north Burundi and were interviewed by UNHCR on Friday. The U.N. Human Rights office in Rwanda said on Thursday 271 Rwandan refugees who returned from Burundi in July and August were arrested by Rwandan authorities and 62 were released. Rwandan authorities screen returning refugees and arrest any suspected of involvement in the 1994 genocide of up to a million Tutsis and Hutu moderates by Hutu troops, militiamen and mobs. The London-based human rights group Amnesty International accuses the Burundian army of forcing the Rwandan refugees back by using torture and extrajudicial executions to terrorise them. 2062 !GCAT !GDIP !GVIO Repatriation of 1.1 million Rwandan Hutu refugees announced by Zaire and Rwanda could start within a few days, an exiled Rwandan Hutu lobby group said on Friday. Innocent Butare, executive secretary of the Rally for the Return of Refugees and Democracy in Rwanda (RDR) which says it has the support of Rwanda's exiled Hutus, appealed to the international community to deter the two countries from going ahead with what it termed a "forced and inhuman action". The RDR has the support of Rwanda's 40,000-strong former Hutu army which moved into Zaire in 1994 with the refugees after the Tutsi-dominated Rwanda Patriotic Front (RPF) took power. "We have a lot of fear, fear for our people. They (Rwanda and Zaire) have done it before and they will do it again. Our information is forced repatriations will start within the next few days," Butare told Reuters. He said the expulsions would be against international laws and had to be prevented by the international community. "Like before, our people will be sent back against their will and they will be treated without any dignity or concerns for their safety," he said. "We appeal to the international community to do everyting in its power to deter the two countries from going ahead with the expulsions," Butare added. The U.N. refugee agency said on Friday it was not consulted by Rwanda and Zaire over the planned repatriation of the refugees, many of whom refuse to return because of fears they will be punished for their involvement in the 1994 genocide. Roman Urasa, head of the U.N. High Commissioner for Refugees (UNHCR) in Rwanda, said in a statement that UNHCR was taking Thursday's announcement by Zairean Prime Minister Kengo wa Dondo and Rwandan Prime Minister Pierre Celestin Rwigema seriously. He expressed hope that repatriation would be voluntary. "We were not consulted about this and although there have been a lot of statements from Zaire, one has to take into account the fact that this has been done at prime ministerial level," Urasa said. "We are therefore treating it with more seriousness. What is important is the interpretation of the word 'immediately'." Kengo told a joint news conference with Rwigema in Rwanda's capital Kigali on Thursday the repatriation operation would begin with the closure of all Rwandan refugee camps in Zaire. "The two heads of government have decided to make operational the organised, massive and unconditional repatriation of all Rwandan refugees," Kengo said. "This is going to be carried out rapidly. The repatriation will be enormous and immediate. We are at a stage where Zaire is going to proceed with the closure of the camps," Kengo added. Kengo was visiting Rwanda as it received thousands of Rwandan Hutu refugees leaving its southern neighbour Burundi. Butare said the returning Rwandan refugees were subjected to harassment, beatings and many had been sent to prison. "Our people are being treated worse than cows. The security situation in Rwanda is deteriorating by the day and in such an environment, people cannot expect justice," Butare said. Zairean President Mobutu Sese Seko has intervened in the past two years to stop Kengo from ordering, in violation of international law, the deportation of the 1.1 million Rwandans. Last August, Zairean troops forcibly expelled some 15,000 Rwandan and Burundian Hutus. The expulsions were stopped only after Mobutu stepped in following an international outcry. 2063 !GCAT !GPOL !GVIO Burundi's new military leadership came under renewed pressure to address the issue of army impunity on Friday after a human rights report claimed 6,000 people had been killed since a July 25 coup d'etat. The report by the London-based human rights group Amnesty International on Thursday said human rights in Burundi had deteriorated despite promises by the army to end killings. In the Giheta district of Gitega province at least 4,050 unarmed civilians were executed extrajudicially by the army and buried in a three-week period after the coup, Amnesty said. A spokesman for Burundi leader Pierre Buyoya on Thursday denied the report's findings and said Amnesty International could have fallen into a propoganda trap. "Amnesty International is either completely misguided or is falling into a propaganda trap. I am positive that they are misinformed and that these numbers are outrageous," Jean-Luc Ndizeye said. "You cannot have so many people killed in such a short time in Burundi without there being a civil outcry," he said. At a news conference prior to the Amnesty report Buyoya said army reform was a top priority but change could not be effected overnight. "Just because there was a change on July 25 it doesn't mean that all the activities of war or the massacres will stop. We are in the process of putting together the building blocks so that security can return and massacres can stop," he said. But the Amnesty report raised questions about Buyoya's willingness to tackle the abuses by the Tutsi-dominated army. Around 150,000 people -- mainly civilians -- have been killed in Burundi since 1993, when the country's first democratically-elected Hutu president was killed in an attempted coup. U.N. Secretary-General Boutros Boutros-Ghali in a report to the Security Council this week recommended countries assemble a force of 50,000 to intervene if Burundi plunged into genocide. Meanwhile, the U.N. High Commission for Refugees (UNHCR) on Thursday said it had finished an operation to repatriate more than 50,000 Rwandan Hutu refugees from the largest camp in north east Burundi. A total of 6,000 refugees crossed the Rwandan border from Magara Camp on Thursday leaving only 220 who refused to go, Paul Stromberg, regional UNHCR spokesman, told Reuters in a telephone interview from northern Burundi. Aid workers said they were uneasy about the behaviour of the Burundian army during the final week of the repatriation, but they said ultimately the refugees were better off in Rwanda. Rwandan refugees accused the Burundian army of burning huts and firing in the air to intimidate them to going home and at the weekend three people were shot dead by the military just outside Magara, according to aid workers. The Rwandan refugee exodus from Burundi began after Burundi's army toppled Hutu president Sylvestre Ntibantunganya on July 25 and installed retired major Buyoya. In another development U.N. human rights monitors reported on Thursday a large rise in killings by "state agents" in Rwanda last month as the number of prisoners and detainees reached 80,000. The U.N. Human Rights Field Operation in Rwanda said in July it received reports of killings of 365 people in 93 incidents: "a very significant increase compared with...other months." The government Rwandan Patriotic Army says it is fighting rebel insurgency from Zaire, but human rights groups say the army is guilty of taking reprisals against civilians. 2064 !GCAT !GCRIM Nigerian police shot dead six robbery suspects as they tried to escape from custody in the northern city of Sokoto, the national news agency reported on Friday. The News Agency of Nigeria (NAN) quoted police spokesman Umar Shelling as saying the six were killed on Wednesday. They had been arrested last week for stealing 800,000 naira ($10,000) from a sheep merchant. 2065 !C24 !CCAT !GCAT !GDIS !GENV Ethiopia's Awash river burst its banks on Friday and flooded more than 2,000 hectares (5,000 acres) of sugar cane fields and workers' homes, the state-run Ethiopian News Agency said. It said thousands of plantation workers' homes were flooded in the area about 100 km (60 miles) east of Addis Ababa and the workers were moved to the nearby town of Nazarthe. More than 2,000 hectares of the Wonji and Shoa sugar estates on the banks of the Awash were inundated, the agency said. Water Resources Minister Shiferaw Jarso said the flooding followed the release of 300 cubic metres of water per second into the river from nearby Koka Dam which was holding dangerous levels. Shiferaw warned residents of the area to move to emergency shelters prepared by the government as staying could be hazardous. Ethiopian authorities say shelters stocked with food, blankets and medicine for up to 150,000 in the area were ready. 2066 !GCAT !GDIP A delegate of the United Nations refugee agency said on Friday an agreement between the Zairean and Rwandan prime ministers did not set a time limit for the return of 1.1 million Rwandan Hutu refugees from Zaire. Hubert Edongo Menye, UNHCR regional delegate for Central Africa, said he would meet Interior Minister Gerard Kamanda wa Kamanda on Saturday to discuss Thursday's agreement to send the refugees home. "This repatriation is a large scale operation, both costly and dangerous, which must take account of the dignity and safety of the refugees," he said. He said a joint communique issued after the prime ministers' Kigali meeting had talked about the "progressive closure" of refugee camps in eastern Zaire, an operation which he said would need the support of the international community. He said the communique had set no time limit, but added: "If the conditions are met, the refugees can be repatriated." Emmanuel Ndahiro, senior aide to Rwandan Vice-President Major-General Paul Kagame, told Reuters in Nairobi by telephone from Kigali that Rwanda sought an orderly, well-organised return. He dismissed as "pure propaganda" charges by a Rwandan Hutu lobby group that Zaire and Rwanda planned to start a "forced and inhuman" repatriation of the refugees within the next few days. "Nobody (in Rwanda) is advocating an abrupt return of the refugees. The return should be orderly, decent and well-organised because not even powerful America can afford to take in one million people at once," Ndahiro said. The 1.1 million mainly Hutu refugees in Zaire are among two million Rwandans who fled civil war and genocide in 1994. Zairean Prime Minister Kengo wa Dondo said in Kigali on Thursday the operation would begin with the closure of all Rwandan refugee camps in Zaire. "The two heads of government have decided to make operational the organised, massive and unconditional repatriation of all Rwandan refugees," Kengo said. "This is going to be carried out rapidly. The repatriation will be enormous and immediate. We are at a stage where Zaire is going to proceed with the closure of the camps." Regional analysts said any final decision to expel refugees from Zaire rested with Zairean President Mobutu Sese Seko, a close ally of the Hutus, now being treated at a Swiss clinic. Mobutu has intervened in the past two years to prevent deportation of the refugees, many of whom say they fear being killed in reprisal for Rwanda's genocide if they return home. 2067 !E41 !ECAT !GCAT !GJOB !GPOL Nigeria's military government has banned the national union of university lecturers, an official statement said on Friday. "Government has decided to proscribe the Academic Staff Union of Universities (ASUU) due to the unpleasant development of persistent strikes in the university system," said the statement released in the capital Abuja. Lecturers in Nigeria's 38 universities have been on indefinite strike since April, to press for better working conditions. The strike has paralysed academic activity and left tens of thousands of students without lessons. Nigeria is under fire from many western countries for human rights abuses and lack of democracy. The lecturers said they embarked on their action to pressure the government to review the agreement it signed with ASUU in September 1992, and which is subject to renewal every three years. Government signed the agreement, only after academics had been on strike for a whole year. "Several efforts have been made by government since 1992 to improve conditions of service for university staff but ASUU remained adamant with its strikes," the statement said. "This action is highly regretted but it is the best in the circumstances." According to ASUU president Asisi Asobie, Nigerian lecturers earn about 3,000 naira ($35.29) monthly, much less than their counterparts in other African countries. 2068 !GCAT !GVIO Ugandan rebels abducted 300 civilians, including school pupils, from northern Uganda before crossing into southern Sudan, army officers said on Friday. They said about 150 rebels of the Lord's Resistance Army (LRA) led by its leader Joseph Kony crossed near Palabek, a border town in the northern district of Kitgum on Monday night. "Some 39 of the captives were students abducted from the Sir Samuel Baker Secondary school. The rebels crossed at full speed ahead of our troops who tried to catch up with them," an officer told Reuters. Speaking by telephone from Gulu, 345 (215 miles) north of Kampala and the main army base fighting the insurgency, the officer said the rebels narrowly escaped an army ambush as they moved north. "We nearly got them, but they detected us and forked to the east before escaping between our lines into Sudan," he said. The LRA rebels, who say they want to rule Uganda in line with the Bible's 10 Commandments, returned to their bases in Sudan after entering Uganda on July 8, according to the army. The army says the rebels killed 108 Sudanese refugees at a camp near Kitgum and moved to Gulu district, where they killed more than 500 people in raids on villages, army and police posts and by landmines. The rebellion has disrupted the north, which has nearly four million people. Schools, hospitals, and government offices have closed in most areas outside Gulu, northern politicians say. Up to 180,000 civilians are holed up in the town after fleeing villages to escape LRA attacks, reporters in Gulu said. President Yoweri Museveni, himself a former guerrilla, has ruled out talks with the rebels and vowed to defeat them. Sudan's government denies backing the LRA and giving it bases and accuses Uganda of supporting Sudanese rebel forces. 2069 !GCAT !GCRIM Police said on Friday they had arrested a family of four and two other people for South Africa's biggest armed robbery of some 31 million rand ($6.8 million) early this month. Mounds of banknotes were found when a couple and their two adult children were arrested late on Thursday outside the Indian Ocean port of Durban. "Detectives recovered six refuse bags and one sports bag containing a substantial amount of cash in their house. A count for the total amount seized is still taking place, it is obviously millions," a spokesman told a news conference. The family was being held for questioning and had not been charged, he said. Two other men in their early 20s were later arrested near Pinetown, the area west of Durban where five gunmen had raided a security firm's cash depot on August 6. ($=4.52 rand) 2070 !GCAT !GPOL !GVIO UNITA delegates began serious debate on Friday on transforming their rebel and military movement into a political one under a proposed unity coalition with Angola's MPLA-led government. On Wednesday, the movement's congress loudly rejected the vice presidency offered to Jonas Savimbi under a peace deal with the government, shouting "negative, negative" when the topic was raised. However there was no official vote. It was unclear if this was the final decision by the people who Savimbi, torn between leading UNITA and joining government, says must decide for him. While refraining from mentioning the post, Savimbi appealed on Thursday to around 1,500 members at the movement's supreme decision-making meeting, in UNITA's northern stronghold of Bailundo, to reject "extreme decisions." Political analysts said if Savimbi did not accept the post it would not lead to a renewed war, but would extend the period of uncertainty over the country's future. They said Savimbi was shedding his guerrilla-leader image when he told the congress war was no longer an option and that they would have to prepare for opposition politics. "This congress, for us, represents a turnaround because no one can talk of an armed party, because we have left that behind...We want to be a political opposition in Angola," Savimbi said. UNITA spent over 20 years trying to topple Angola's formerly Marxist MPLA rulers after independence from Portugal in 1975. The two sides signed a peace deal in 1994 and agreed to integrate their troops into a single national army under a government of national unity. The government has agreed to integrate nine UNITA generals into the top brass of this united army. But Savimbi said this left more than 50 other UNITA generals with uncertain future. A European analyst at the meeting said Savimbi's speech was encouraging, adding: "This is a new Savimbi...He is speaking like a politician now and not a soldier. "But the question still remains as to how UNITA is going to transform from a military movement and when we will see its leaders in Luanda." Savimbi said UNITA had met its obligations under terms of the peace, including disarming 60,000 UNITA fighters, but President Jose Eduardo dos Santos's government had not kept its side of the accord. He alleged not all MPLA troops and special police had been confined to barracks and that the government had failed to expel all foreign mercenaries and was still buying weapons. Despite the shaky peace, Angola has remained largely divided into MPLA-controlled areas centred on the capital Luanda, and UNITA territory that includes northern diamond areas whose riches helped to pay for its war effort. Savimbi's dilemma is that to join the government while staying as UNITA chief he would effectively need to be in two places at once. 2071 !GCAT !GPOL !GVIO A black guerrilla of South Africa's African National Congress enters detention hale and hearty, but is released 14 months later gaunt and frail. After a week of freedom he dies under suspicious circumstances and when questions are later asked about the case, one of the country's leaders says the man was never detained. It sounds like one of the myriad stories of apartheid abuses under cruel white governments, but the man's jailers were from the ANC itself and the politician trying to put the right spin on the case was the ANC's Deputy President Thabo Mbeki. The rise and fall of Thami Zulu in the 1980s was described in documents presented by Mbeki on behalf of the ANC on Thursday to the Truth and Reconciliation Commission, mandated to report on gross human rights violations during apartheid. His case's handling by the ANC security department, which suspected he was a spy, raised concerns at the time that the department was morally no better than Pretoria's secret police. It was the subject of an ANC inquiry which said among other things: "There are too many causes of death." When Zulu died a week after his release, an autopsy revealed he had AIDS, pneumonia, tuberculosis and traces of poisoning. His death in Lusaka in late 1989 ended a guerrilla career that began in the mid-1970s when he joined an exodus of young black South Africans to ANC bases in neighbouring countries. "From 1983 until 1988, TZ (Thami Zulu) was commander of the Natal machinery. The losses during that period were extremely high. The evidence suggested that the machinery had been infiltrated by the enemy," the inquiry report said. It said Zulu came from quite a comfortable home and went to a good school in Swaziland, growing up in circumstances very different from those experienced by guerrillas he led. "He was said to be a connoisseur of good whisky, who played squash and went to steam baths when he should have been deep underground," the report said. "One witness pointed out...he was young and inexperienced and tried to make up for his immaturity by giving himself the airs of a Napoleon. The result was he became unpopular with the great majority of people who worked closely with him." After an ambush in which nine guerrillas under his command were killed, Zulu was recalled to Lusaka where interrogators tried to establish if he was a spy for Pretoria. The report said he was kept under a form of house arrest for 12 months and for eight weeks in effective solitary confinement. But Mbeki told the truth commission on Thursday that Zulu had never been detained. Asked about the apparent contradication, an ANC spokesman said Zulu had not been placed in the movement's jail in Lusaka and therefore had not "technically" been detained. The ANC inquiry report found there was no suggestion that Zulu had been physically maltreated in detention but added: "There was no direct, clear or tangible proof that he had in fact collaborated with the enemy." It said he had been released from solitary confinement only because he was obviously at death's door. "He entered confinement as a large, well-built slightly overweight person and came out gaunt, frail and almost unrecognisable," the report said. Referring to the Lusaka detention centre, it said: "It was painful for us to see a poster of Comrade Nelson Mandela, who has spent so much time in South African prisons, on the walls of this ANC jail." 2072 !E41 !ECAT !GCAT !GJOB !GPOL Zimbabwean civil servants pressed on with a strike for higher pay on Friday in an unprecedented defiance of government threats to sack them if they persisted. Thousands including junior state doctors, nurses, magistrates and mortuary attendants, emboldened by strong public support, said they would remain on the streets until their demands for wage rises of between 30 and 60 percent were met. The strike is a rare challenge to President Robert Mugabe and his dominant ruling ZANU-PF party, both in power since 1980. Some senior officials and MPs have broken ranks with the government to support the workers. Others have insisted that the government could not afford to back down. MPs from the ruling ZANU-PF party who usually rally behind government positions called late on Thursday for government to meet the workers' demands, but some cabinet ministers said there was no room to back down to "mob rule". Civic organisations, opposition parties and private-sector unions have weighed in with statements of solidarity, denouncing the government for recently awarding civil servants salary increases of only up to eight percent. The Public Service Association (PSA) union rejects the offer as "an unacceptable insult" and says a majority of the southern African state's 180,000 civil servants deserve more. On average, civil servants earn Z$1,000 (U.S. $99) a month and PSA union leaders justify their 60 percent pay rise demand on grounds that salaries in the public service have fallen far below the cost of living over the years. "There is no question of us going back to work before the government addresses our grievances. We are not going back and we will not respond to any threats to dismiss us," Frank Chamunorwa, vice-president of the PSA, told state radio. His comments followed a statement by Public Service, Labour and Social Welfare Minister Florence Chitauro that she had told officials to sack those who did not report for work on Friday. The strike has left many state hospitals handling only emergencies under senior doctors and nurse administrators with help from army and Red Cross medical personnel. Chitauro told PSA executives at exploratory talks on Thursday that her government would consider their grievances seriously only when their followers returned to work. She said armed police would continue to guard government offices to protect property and civil servants who wanted to work from being intimidated by strike leaders. 2073 !GCAT !GVIO Liberia's new woman head of state has returned to Monrovia with the faction leader at the centre of fighting earlier this year, promising the latest peace accord will bring peace and reconciliation. Hundreds of supporters, including several women's organisations, cheered Ruth Perry and Roosevelt Johnson as they disembarked from a Nigerian airforce plane on Thursday. "I bring with me love, unity, reconciliation and peace for Liberia," Perry told the crowd, who booed the outgoing chairman of the ruling Council of State, Wilton Sankawulo. "I can't do it alone, but with the support and assurances of my colleagues and us all, I am sure the war is now over," Perry added. West African heads of state and Liberian faction leaders meeting in the Nigeria appointed Perry on Saturday as part of a new peace accord which sets a timetable for disarmament by the end of January and elections on or around May 30 next year. The latest agreement threatens faction leaders with sanctions, including seizure of assets and war crimes tribunals, if they are seen to be obstructing the peace process. Faction leaders have accused each other of breaking a ceasefire which was supposed to come into force on Tuesday. Perry told reporters she would travel to Grand Cape Mount, her home county in western Liberia, to halt clashes reported there between Johnson's supporters and fighters loyal to council member Alhaji Kromah. "Both Alhaji Kromah and General Johnson have asked me to go to Cape Mount personally to make peace and I am going to go to Cape Mount as the first place to make a move," she said. Perry, 57, was a Liberian senator during the 1980s under the government of slain president Samuel Doe. Over a dozen peace deals have failed to end the war launched by Charles Taylor and his National Patriotic Front of Liberia (NPFL) in late 1989. Taylor and Kromah are both vice-chairmen on the Council of State. Their attempt to arrest Johnson for murder in April triggered some of the bloodiest fighting of the war in the streets of Monrovia, pitting Johnson's ULIMO-J faction and its ethnic Krahn allies against Taylor and Kromah. Health officials estimate that some 1,200 people were killed in seven weeks of fighting in the city centre. 2074 !GCAT These are significant stories in the Nigerian press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. THE GUARDIAN - Government applies tough rules on oil firms. - Nigerian National Petroleum Corporation (NNPC) may have initiated fresh moves to establish a plant to process crude oil into petroleum coke and pitch, for the infant aluminium industry. The project costing $100 million is believed to have been shelved 10 years ago for lack of customers. THISDAY - Government blacklists Adwork advertising company after legal tussle between Adwork and Nigeria Airways over payments led to the seizure of a Nigeria Airways plane in London. - Ongoing telecommunications deregulation may prevent government from funding Internet connectivity for Nigeria. VANGUARD - Relaunch of Mobil household insecticide cost the company 200 million naira. --Lagos newsroom +234 1 2630317 2075 !GCAT These are significant stories in the Ivorian press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. FRATERNITE MATIN - Cabinet meeting sacks managers of state oil firm PETROCI, and sanctions three secondary school principals for embezzlement. - Assistance Contact International Cote d'Ivoire expected to be succesful bidder for Palm Club hotel complex, offered for sale as part of the privatisation of state palm oil producer Palmindustrie. LA VOIE - Ivorian maid Veronique Akobe, jailed in France in 1990 for 20 years for killing her employer's son and attempted murder of her employer, both of whom she accused of raping her, holds news conference on her return to Abidjan to thank Ivorian support committee for lobbying for her release. LE JOUR - Raids around Abidjan continue in crackdown by security forces, 14 known suspects found among 232 people detained on Wednesday night. -- Abidjan newsroom +225 21 90 90 2076 !GCAT !GDIP Repatriation of 1.1 million Rwandan Hutu refugees announced by Zaire and Rwanda on Thursday could start within the next few days, an exiled Rwandan Hutu lobby group said on Friday. Innocent Butare, executive secretary of the Rally for the Return of Refugees and Democracy in Rwanda (RDR) which says it has the support of Rwanda's exiled Hutus, appealed to the international community to deter the two countries from going ahead with what it termed a "forced and inhuman action". 2077 !GCAT !GDIP The U.N. refugee agency said on Friday it had not been consulted by Rwanda and Zaire over the planned repatriation of 1.1 million Rwandan Hutu refugees who fled to Zaire in three months of war and genocide in 1994. Roman Urasa, head of the U.N. High Commissioner for Refugees (UNHCR) in Rwanda, said in a statement that UNHCR was taking Thursday's announcement by Zairean Prime Minister Kengo wa Dondo and his Rwandan counterpart Pierre Celestin Rwigema seriously. He expressed hope that repatriation would be voluntary. "We were not consulted about this and although there has been a lot of statements from Zaire, one has to take into account the fact that this has been done at prime ministerial level," Urasa said. "We are therefore treating it with more seriousness. What is important is the interpretation of the word immediately," he added. Kengo told a joint news conference with Rwigema that the repatriation operation would begin with closing all Rwandan refugee camps in Zaire. "The two heads of government have decided to make operational the organised, massive and unconditional repatriation of all Rwandan refugees," said a statement read by Kengo. "This is going to be carried out rapidly. The repatriation will be enormous and immediate. We are at a stage where Zaire is going to proceed with the closure of the camps," Kengo added. Urasa said he hoped the two countries would involve his agency in any planned operation and stressed that it should be voluntary. "We hope UNHCR will be involved and if this is the case, we would welcome it and hope it will be voluntary," he said. Kengo's statement came as Rwanda received thousands of Rwandan refugees who were leaving its southern neighbour Burundi. The U.N. refugee agency said it ended on Thursday the repatriation from Burundi of more than 45,000 Rwandan Hutu refugees from the biggest camp in northern Burundi. Zairean President Mobutu Sese Seko has intervened in the past two years to stop Kengo from ordering, in violation of international law, the deportation from Zaire of the 1.1 million Rwandan Hutus. Kengo's visit was the first by a senior Zairean official since the Tutsi-dominated Rwandan Patriotic Front rebels took power in 1994 and drove into exile in Zaire the Hutu government and Hutu soldiers held reponsible for the genocide. Last August, Zairean troops forcibly expelled some 15,000 Rwandan and Burundian Hutus. The expulsions were only stopped after Mobutu stepped in following an international outcry. 2078 !GCAT !GPOL !GVIO Russian and separatist forces in Chechnya kept to a truce begun on Friday under a new military agreement to end war in the region while their commanders discussed how to implement the rest of the deal. In Moscow, President Boris Yeltsin signalled his backing for his Chechnya envoy Alexander Lebed, who had signed the agreement with rebel chief-of-staff Aslan Maskhadov and was drafting a broader political agreement. Yeltsin gave the former paratroop general his blessing to go for a political solution, Itar-Tass news agency reported. Lebed had briefed Yeltsin late on Friday. But the Russian leader seemed unready for concessions on the rebel demand for full autonomy. His press service said Yeltsin had empowered Lebed to hold talks aimed at a political accord defining Chechnya as an integral part of the Russian Federation. Both rebels and Russians said on Friday evening that the situation had been generally calm across Chechnya after the truce started at noon (0800 GMT). Maskhadov, who met Russian top commander General Vyacheslav Tikhomirov in the village of Novye Atagi 20 km (12 miles) south of the Chechen capital Grozny, said fixing details was easy now a definite decision had been taken to restore peace. "The most important thing is that there is a firm decision to stop the war which makes it easy for us to discuss details," Maskhadov said. "It is difficult to talk to each other when you don't know if they want to end the war." Lebed and Maskhadov have agreed that Russian troops besieged in Grozny since August 6 as well as the rebels who seized the city, would return to their bases outside the city. They have also agreed that joint groups will patrol Grozny. Under the deal Russia will start withdrawing troops on Saturday from the southern parts of Chechnya where rebel positions are especially strong. The rebel field commander for the southern district of Shatoi told Reuters correspondent Dmitry Kuznets that the local Russian commander had already received a pullout order from headquarters and his regiment will withdraw before August 29. The rebel and Russian commanders said later that the first troops would set off from the region on Saturday. Interfax news agency said that before August 26 troops would leave other southern districts of Vedeno and Nozhai-Yurt. Tikhomirov told reporters after talks with Maskhadov that they had to be wary of the mysterious "third force", which had crushed all previous attempts to reach peace. "We took precautions though, so as to make sure that this third force would not show up and ruin the deal," he said. Interfax news agency later quoted him as saying that any force which would dare to violate the deal may be exterminated. Yeltsin's backing was seen as crucial for Lebed, a novice in the intrigue-filled Kremlin corridors, who has admitted he expects strong resistance to the deal which some forces in Moscow might consider a national humiliation. Yeltsin gave sweeping powers to Lebel to end the 20-month Chechnya war, but until late on Friday had maintained an ominous silence in Moscow over Lebed's progress. Lebed has said that he would return to Chechnya at the weekend to sign a "political document" which would define relations between Moscow and Chechnya. Yeltsin has said he wants peace but rejects rebel demands for full independence. Analysts doubt whether, after the humiliation of the army in this month's fighting, he will be willing to lose more face by making new concessions. Lebed, however, has said in the past he has no objection to Chechen secession if the region's one million people want it. Lebed, speaking overnight to Russian news agencies, said he would not hesitate to use his powers to sack senior officials if they oppose his plan. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," he said. 2079 !GCAT !GDIP !GPOL !GVIO !GVOTE International mediator Carl Bildt reprimanded regional leaders of Bosnia's dominant Moslem party on Friday for wanton violence against election rivals and said after talks they had promised to stop it. "We think they and their bosses in Sarajevo will get the message from our visit today, that selective state terrorism cannot be tolerated if we are to build democracy in (post-war) Bosnia," an official in Bildt's delegation told Reuters. Bildt, the international High Representative in Bosnia, flew by helicopter to the northwestern Bihac region to press ruling Moslem nationalists and the police they control to stop preying on opponents in the nationwide elections on September 14. More than two dozen bombings and physical assaults against moderate rivals of President Alija Izetbegovic's Party of Democratic Action (SDA) had been reported in the Bihac region over the past two weeks. Sources close to Bildt blamed much of the violence on agents of a shadowy international intelligence service (AID) run by the SDA or thugs linked to the SDA-run local police. "The reports we received are numerous and grave. We don't think the police here have been responding to protect people with different political views," Bildt said in Cazin, the town in the Bihac region most plagued by pre-election violence. "It was agreed in our talks that steps must be taken to prevent a repetition of (violence) to safeguard freedom of political expression," he told a news conference. SDA officials seated alongside Bildt did not acknowledge responsibility for pre-election thuggery. But regional Police Minister Edhem Veladzic said he had sacked the police chief of Cazin municipality, second largest in the Moslem-populated region, for what he suggested was negligence in investigating political violence. Aides to Bildt said the man was fired after a no-nonsense demarche on Wednesday by the U.N. police monitoring force (IPTF) in Bosnia to the SDA leadership in the Bihac area. "There hasn't been one explosion since then. For two weeks before that, not one night passed without a grenade or something else going off outside an opposition home," one said. Veladzic promised improved security measures for all people regardless of their politics but said IPTF would be more helpful if it helped train his police instead of just relay reports of violence to international mediators. He also claimed that people in the Bihac region enjoyed full freedom of speech and assembly and that 50 percent of IPTF reports on disturbances were inaccurate. Bildt angrily interrupted at that point. "I do not accept these statements. The reason we are here is that local cooperation with IPTF has been unsatisfactory and that local police have not taken sufficient action against (pre-election violence)," he said. Opposition party leaders who met Bildt earlier told Reuters they were unable to hold rallies or meetings for fear of SDA harassment. They spoke of periodic beatings, death threats and opposition-owned shops and cars being demolished by bombs. "All of this happens after the 11 p.m. curfew. Who is free to move around then except the (police) authorities?" said retired Brigadier Muhamed Delalic, local chairman of an opposition party led by former prime minister Haris Silajzdic. SDA-linked thugs assaulted Silajdzic with a metal pipe at a rally in Cazin in June. In Sarajevo, U.N. authorities also censured authorities in separatist Serb parts of Bosnia for human-rights abuses against minority Moslems and Croats and preventing free movement less than a month before the elections. 2080 !GCAT !GCRIM !GDIP !GVIO The U.N. war crimes tribunal for former Yugoslavia opened an office in Belgrade on Friday, marking what deputy prosecutor Graham Blewitt called a new Yugoslav commitment to cooperate with its work. Both the United Nations and tribunal prosecutors complained in the past that Belgrade had failed to help track down indicted war criminals and to allow investigators to work here. Blewitt told a news conference: "I'm pleased to say that I've been given an assurance from the Federal Republic of Yugoslavia that they are prepared to cooperate in accordance with their international obligations to which they are a party, including the statute of the tribunal." Under the Dayton peace agreement for Bosnia and a number of U.N. Security Council resolutions, Yugoslavia -- now consisting of Serbia and Montenegro -- is legally obliged to help the International War Crimes Tribunal for Former Yugoslavia (ICTY). Only after months of intensive negotiations at the U.N. in New York did Yugoslav authorities allowed The Hague-based tribunal to open the Belgrade office to coordinate investigations. "The written agreement will allow prosecutors to send investigators into Yugoslavia to conduct interviews and inquiries," he said. "It also guarantees freedom of movement of prosecutors' staff and gives access to central and local authorities." But the deputy prosecutor also sounded a note of caution. "Beyond that, it is only a question of waiting to see what future developments will be." Despite paying lip service to support for the tribunal, Yugoslavia has yet to extradite Serb suspects to The Hague. One of the most prominent figures wanted by the tribunal on genocide charges, Bosnian Serb army commander Ratko Mladic, made a very public appearance in May at a funeral in Belgrade. Serb authorities have also refused to extradite four Yugoslav army officers accused of murdering 200 civilians in the 1991 battle for Vukovar in eastern Croatia. "Obviously in our dialogue with the Belgrade government we will remind them that obligations do exist and that there is an expectation that they will honour their obligations to arrest and surrender those accused," Blewitt said. But one Western diplomat said he doubted Yugoslavia "has changed its spots". "I can't really see them bending over backwards to help the tribunal now. They may have signed the deal, but that doesn't mean they are going to reverse the trend of the past year." While the majority of those indicted are Serbs, Blewitt also insisted that by opening an office in Belgrade, the ICTY would use the chance to investigate crimes against Serbs. The Bosnian Serb news agency SRNA reported on Friday that Serb authorities have filed war crimes charges against a number of rival leaders including the Bosnian President Alija Izetbegovic, a Moslem, and Croatian President Franjo Tudjman. SRNA said the leaders were accused of war crimes against civilians and prisoners-of-war. Blewitt refused to comment on individual allegations, but insisted that anyone found linked with war crimes would be indicted, regardless of who they were or the positions they held. The ICTY was set up by the U.N. Security Council in May 1993 and has jurisdiction over individuals accused of war crimes, genocide and crimes against humanity. It is the first such international body set up to prosecute war crimes since the Nuremberg and Tokyo trials held after World War Two. It has indicted 75 suspects, including 54 Serbs, 18 Croats and three Moslems, although it holds only seven in its cells. Apart from Mladic, the most prominent figure wanted by the tribunal is former Bosnian Serb leader Radovan Karadzic. Both are still at large in the Bosnian Serb republic. Although the tribunal has a team of investigators, it has no powers of arrest and relies instead on local authorities to hand over the accused. 2081 !GCAT !GDEF !GDIP Ukraine's defence ministry on Friday denied a Taiwanese newspaper report that Taiwanese air force pilots had tested Sukhoi SU-27 fighters in early 1996 in Ukraine to learn the capabilities of the fighters used by rival China. The mass-circulation China Times newspaper quoted unspecified sources as saying the air force sent a four-man team to judge the SU-27 fighters as a reference for Taiwan's anti-air defence after China selected the SU-27 as its leading fighter. "That's not true. There was no such thing," defence ministry spokesman Colonel Valery Korol told Reuters. "It's against our military rules and practice to allow foreign pilots to use our aircraft on our territory," he said. "You can buy planes but there were no sales either." Ukraine does not manufacture fighters and inherited most of its military planes from the former Soviet Union. Ukraine's Antonov manufacturer builds mostly civil and military transport planes. The Ukrainian airforce consists of more than 2,000 planes of 50 different types, including SU-27, Mig-25 and Mig-29. A Taiwanese air force spokesman could not confirm the report. "So far, we haven't made any comments on the report," the spokesman said in Taipei. The report came soon after Taiwanese Vice-President Lien Chan returned to Taipei on Thursday night from a private visit to Ukraine which led to a protest note from Beijing. In a separate development, Ukraine's foreign ministry issued an official statement on Friday accusing the Taiwanese mass media of overestimating Lien's visit, which was non-official and private. "Taiwan's media again and again talk about the so-called 'official nature' of Lien Chan's trip and contacts with the leaders of the state and goverment -- which simply does not correspond with reality," the statement said. Lien said on Thursday in Taipei that he met people "of all levels" during his secretive Kiev mission, but declined to confirm reports he had met Ukraine's president. Ukraine's Foreign Minister Hehhady Udovenko denied that there was any meeting between Lien and President Leonid Kuchma but confirmed on Thursday that Ukraine was interested in developing trade with Taiwan and wanted to open a trade mission in Taipei. China cancelled a visit by a top-level delegation in protest at the visit. Udovenko said Beijing was overreacting. 2082 !GCAT !GDIP !GPOL !GVOTE The OSCE may postpone some municipal elections in Bosnia in response to evidence the voter registration process for refugees and displaced persons has been unfairly manipulated, an OSCE spokeswoman said on Friday. "One option is to postpone some municipal elections in areas where there may be a problem," said Agota Kuperman, spokeswoman for the Organisation for Security and Cooperation in Europe (OSCE), which is supervising elections. The OSCE's Provisional Election Commission (PEC) -- its top rule-making body -- met behind closed doors in Sarajevo on Friday to consider postponement, among "a number of other options" but failed to reach a final decision. Bosnians are scheduled to go to the polls on September 14 to elect local assemblies in 109 municipalities, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-person collective Presidency. As many as 2.9 million Bosnians may vote on election day. As many as half could be refugees and displaced persons. OSCE and independent monitors report hundreds of thousands of refugees living in Serbia and displaced persons in Bosnia's Serb republic were actively discouraged from registering to vote in the community in which they lived before the war. Officials say local authorities directed these individuals to register in target communities where the pre-war Moslem majority was expelled during the 43-month Bosnian conflict. According to OSCE officials the intent of this "electoral engineering" is to cement Serb control over strategic but depopulated towns by ensuring a Serb majority even if all expelled Moslems somehow show up to vote on election day. Bosnian Moslems complain that municipal elections under such conditions would merely ratify ethnic cleansing. The international community's High Representative in Bosnia, Carl Bildt, expressed "deep disquiet" over refugee registration figures recently released by OSCE and asked them for a plan of action to remedy the apparent injustice. Bildt told Reuters on Thursday some of the voter registration numbers were "obviously rigged". "The figures are simply not credible as voluntary acts. They fly in the face of common sense," he added. Swiss Foreign Minister Flavio Cotti, the current chairman-in-office of the OSCE, said there was little evidence political conditions had improved in the two months since he gave the go-ahead for the polls to take place on September 14. "There are still too many instances of violations of human rights. Freedom of opinion and freedom of assembly are being encroached upon by acts of intimidation," Cotti said in a statement issued from OSCE headquarters in Vienna. He said he was most deeply concerned over reports of the manipulation of voter registration. "Thousands of eligible voters appear to have registered for places like Brcko, Srebrenica, Zvornik, Doboj, Foca, etc, in which from today's perspective, they would hardly ever intend to settle," Cotti added. The Moslem SDA party announced on Friday it was asking the OSCE to postpone the municipal elections and abolish all voting by "Form 2" -- the voter registration form which enabled people to register in a place other than their pre-war home. The SDA, one of three main parties in Bosnia, said its main Board would meet on Sunday and if its demands were not met it would reconsider participating in elections and might call on other parties to do the same. Kuperman said the OSCE was thinking about postponing elections in a relatively small number of municipalities where registration numbers were troublesome but indicated even that course of action would not be trouble-free. She reported that the OSCE official in charge of registration for out-of-country voters insists the process had been carried out in a "technically correct" way. "There are (Provisional Elections Commission) members who feel that if the rules and regulations have been followed we are bound and we cannot make changes," Kuperman said. The spokeswoman added that the PEC could not make any final decision without the concurrence of the OSCE's mission chief for Bosnia Robert Frowick, who is out of the country until Saturday. The mandate to hold the election on September 14 comes from the Dayton peace agreement, but there is no requirement that municipal elections be included as part of that process. 2083 !GCAT !GPOL Ukraine celebrates five years of independence from Kremlin rule on Saturday, hailing civil and inter-ethnic peace as its main post-Soviet achievement. Ukraine's declaration of independence in 1991, backed nine-to-one by a referendum in December of that year, effectively dealt a death blow to the Soviet empire and ended more than three centuries of rule from Moscow. Ukraine, with a Russian community of 11 million people -- the world's largest outside Russia -- has avoided conflicts like those in Russia's Chechnya, neighbouring Moldova, and the former Soviet republics of Georgia, Azerbaijan and Tajikistan. "Ukraine's biggest achievements for five years are the preservation of civil peace and inter-ethnic harmony," President Leonid Kuchma said in televised statement this week. "Unlike many other post-Soviet countries we were able to deal with conflict situations in a peaceful and civilised way." But independence was initially accompanied by hyper-inflation and economic collapse, although there are signs of a turnaround. Inflation -- a hyper-inflationary 10,300 percent a year in 1993 -- was a respectable 0.1 percent a month in June and July and the economy has just begun to grow. Kuchma told a solemn ceremony at the Ukraina Palace on Friday that "there was a turning point" in reforms and that he expected a rise in the standard of living in the near future. "There is no doubt that economic growth has already started," said Adelbert Knobl, head of the International Monetary Fund's mission in Ukraine. "The national bank and the government have every reason to be proud of their efforts." Central bank officials said on Thursday that a much-postponed hryvna currency would "definitely" be introduced before the end of this year. It will replace the interim karbovanets currency, which was introduced at par to the Russian rouble in 1992 but now trades at almost 33 karbovanets per rouble. Ukraine has repeatedly promised to introduce the hryvna but had to postpone the plans because of economic problems. Proud of its record in promptly joining both the Council of Europe and NATO's Partnership for Peace, Ukraine caused a foreign policy wrangle this week, offending China by allowing a Taiwanese minister to appear on a public, if unofficial visit. China cancelled a visit by a top-level delegation in protest. Kiev's Foreign Minister Hennady Udovenko said Beijing was overreacting. But Ukraine, seeing itself as a bridge between Russia and the rapidly Westernising countries of eastern Europe, is looking West as well as East. "The strategic aim of European integration should not in any way damage Ukraine's interests in post-Soviet areas. Relations with Russia, which is our main partner, have great importance," Kuchma said. "But Ukraine cannot be economically oriented on Russia, even though those in some circles push us to do that." Kuchma has said Kiev wants membership of the European Union, associate membership of the Western European Union defence grouping and to move closer to NATO. A message from the West this week from U.S. President Bill Clinton congratulated Ukraine on the anniversary, promising to support market reforms and praising Ukraine as a "stabilising factor" in a united Europe. 2084 !GCAT !GPOL !GVIO Russian and separatist forces kept to a truce begun on Friday under a new military agreement to end war in the region while their commanders discussed how to implement the rest of the deal. In Moscow, President Boris Yeltsin avoided holding a meeting with his Chechnya envoy, Alexander Lebed, who had signed the agreement with rebel chief-of-staff Aslan Maskhadov and was drafting a broader political agreement. A rebel spokesman said Maskhadov and Russia's top commander in Chechnya, General Vyacheslav Tikhomirov, met in the village of Novye Atagi 20 km (12 miles) south of the regional capital Grozny to discuss the separation of forces in the city. Interfax news agency said that Maskhadov and Tikhomirov had agreed to pull both the Russian troops and the rebels from the city by next Thursday. Rebel spokesman Movladi Udugov said on Friday night the situation was generally calm in Chechnya after the truce began at noon (0800 GMT). Russian military sources said the same. Apart from the withdrawal from Grozny, held by the rebels since August 6, the deal provided for an exchange of prisoners and the start of Russian troops' withdrawal from southern Chechnya, where rebel positions are especially strong. The rebel field commander for the southern district of Shatoi told Reuters correspondent Dmitry Kuznets that the local Russian commander had received a pullout order from headquarters and that his regiment would withdraw before next Thursday. The rebel and Russian commanders said later that the first troops would set off from the region on Saturday. Interfax news agency said that before Monday troops would leave other southern districts of Vedeno and Nozhai-Yurt. Army and rebel officials said preparations were under way to form joint monitoring units with the guerrilla forces in Grozny to police the city and separate the warring sides. But the joint patrolling has been met cautiously by many on both sides who have had each other in their gunsights for the past two weeks during the worst fighting in more than a year. "We have to try it, but I doubt if this is possible with the separatists," woman soldier Svetlana Goncharova, 35, said. A rebel fighter Said-Magomed Beldurov, 39, said such patrols could be only a temperary measure. "We will never agree to permanent joint administration," he said. "This is our city". Lebed, whom Yeltsin gave sweeping powers to end the 20-month Chechnya war which had killed tens of thousands people, did not hear a word of praise or criticism for the deal from his Kremlin chief on Friday. Itar-Tass news agency said Yeltsin was waiting for a written report on Lebed's latest trip to Chechnya and would not meet him until early next week when the ex-paratroop general is due back from his next trip. Lebed has said that he would return to Chechnya at the weekend to sign a "political document" which would define relations between Moscow and Chechnya. Yeltsin has said he wants peace but he rejects rebel demands for full independence. Political analysts doubt whether, after the humiliation of the army in this month's fighting, he will be willing to lose more face by making new concessions. Lebed, however, has said in the past he has no objection to Chechen secession if the region's one million people want it. Lebed, speaking earlier to Russian news agencies, said he would use his powers to sack senior officials if they opposed his plan. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," he said. But Yeltsin's backing is crucial for the ex-paratroop general, a novice in the intrigue-filled Kremlin corridors, who has admitted he expects strong resistance to the deal which some forces in Moscow might consider a national humiliation. 2085 !GCAT !GDIP Croatia and Serbian-led Yugoslavia signed a landmark mutual recognition accord on Friday, ending five years of hostility sparked by Croatia's bid for independence. Croatian Foreign Minister Mate Granic and Yugoslav Foreign Minister Milan Milutinovic agreed the deal which diplomats hope will help bring stability to the Balkans. "This agreement today is in a certain way a historic one for both countries since it represents a turning point in relations between our two countries," Milutinovic said. Yugoslavia considers relations between the two countries as the backbone of peace in the Balkans, he told reporters. "This agreement is the foundation of stability in the region... and the basis for solving many issues," Granic said. The ceremony was held in the Serbian hall of the palace of the federation, built when communist leader Josip Broz Tito ruled Yugoslavia. Tito's death in 1980 paved the way for the eventual rise of nationalism and the federation's collapse. Both ministers said the accord does not solve all disputes between the governments but provides grounds for their future settlement. The details of the accord had yet to be released but sources close to the talks said it was mostly based on the agreement struck by presidents Slobodan Milosevic of Serbia and Franjo Tudjman of Croatia in Athens earlier this month. Croatian officials, who asked not to be named, said the accord called for the two countries to exchange ambassadors within 15 days. The main sticking point in Friday's last-minute talks was the future status of Prevlaka, a sliver of land jutting into the Adriatic. Croatian-held Prevlaka dominates the mouth of the Boka Kotorska bay, the home of the Yugoslav navy. Diplomatic sources said Granic insisted on the Athens formula that the peninsula was a "security" and not a territorial issue. "This probably means that Prevlaka will remain Croatian but will be demilitarized," a Western diplomat said. The Serbs had been dissatisfied with the formulation but by the afternoon the two sides agreed the issue before sitting down to a lunch of lamb served on plates with the seal of the former Yugoslavia. Sources said the accord guarantees a safe return of refugees, general amnesty for Serbs who want to live in Croatia and envisages raising of diplomatic relations to the embassy level. The current chiefs of missions -- Zvonimir Markovic in Belgrade and Veljko Knezevic in Zagreb -- will most likely be promoted as ambassadors, diplomats said. As for rights to the legal succession of former Yugoslavia, the most important issue for Belgrade, the two sides agreed that all five former republics would have equal successor rights. Yugoslavia, comprising Serbia and Montenegro, would be allowed to renew membership in international organisations without Belgrade having to submit a formal request. War erupted in 1991 when Serbs, backed by the Yugoslav army, rebelled against Croatia's bid for independence from Yugoslavia, a federation of six republics. Croatia recaptured Serb-held territory last August except for one Serb enclave, Eastern Slavonia, which is due to be handed over to Zagreb next year. Earlier, Granic drove through Belgrade in a limousine carrying a Croatian flag -- the first time the Croatian banner has been unfurled on Serbian territory since the federation disintegrated in 1991. Serbs resent the flag's chequerboard symbol, the "sahovnica", associated with the pro-Nazi puppet regime that ruled Croatia during World War Two and persecuted Serbs. Belgrade normalised relations with one other former Yugoslav republic, Macedonia, earlier this year. 2086 !GCAT !GPOL !GVIO Russian Security supremo Alexander Lebed pushed ahead with a ceasefire plan in rebel Chechnya on Friday, but the absence of public approval from President Boris Yeltsin raised questions about Kremlin support for him. The ambitious reserve general, whose political career could depend on success in Chechnya, said he would meet the president on Friday to discuss a peace plan negotiated in Chechnya on Thursday. But Yeltsin's office said no meeting was planned. Hours before Lebed struck the deal in Chechnya, Yeltsin criticised him for acting too slowly to end the 20-month war. He has since made no comment on the truce, which began at noon (0800GMT). Grozny was relatively calm on Friday and both Russian soldiers and Chechen fighters said the ceasefire was holding. "Preparations are going on now for the withdrawal of units from southern districts of the republic to the Chechen plain," Interfax quoted the Russian command in Chechnya as saying. Lebed, a reserve paratroop general appointed by Yeltsin last week to settle the conflict, said he had been given full command of operations there and would meet Yeltsin in the afternoon. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," Interfax news agency quoted him as saying on his return to Moscow early on Friday. But Lebed's powers have never been clearly defined in public and the chain of command has been tangled in recent days. It will take tough words from Yeltsin to convince Russia's military hawks, humiliated by the rebels' seizure of the Chechen capital Grozny this month, they should give Lebed a chance. The signs are not encouraging so far. The head of Russia's North Caucasus military district, which includes Chechnya, noted ceasefires have come and gone before. Yeltsin said of Lebed on Thursday: "He always promised to solve the Chechnya problem if he had power. Now he has power. But unfortunately the results of his work are not yet obvious." "But we will not despair. We will take the issue to the end," he added. Izvestia newspaper said the criticism raised serious questions and hinted that the president was out of touch. "Either the president is still demanding the impossible -- the restoration of legal order in Chechnya as it was on August 5," it said, referring to the day before rebels seized Grozny. "Or he is judging the activities of his security adviser on the basis of the siuation before Lebed's last trip to Chechnya." Both the United States and the European Community have already welcomed the ceasefire agreements. "We welcome this agreement... We look forward to its implementation by both of the parties and hope it leads eventually to a political settlement to the Chechen crisis," U.S. State Department spokesman Glyn Davies said. Lebed, then commander of the 14th Russian Army, made his name as a peacemaker in Moldova's breakaway Dnestr region in 1992. He was named Yeltsin's security adviser as a vote-winning move between the two rounds of the presidential election. Lebed had captured 15 percent of the first-round vote, taking third place behind Yeltsin and the communist runner-up. Yeltsin virtually disappeared from sight soon after the first round, prompting speculation that he was ill. Aides denied all the rumours and press spokesman Sergei Yastrzhembsky told Izvestia the president was "lively and dynamic" on Thursday after a two-day break. Komsomolskaya Pravda said Yeltsin had gone fishing and boating and played billiards during his short vacation. Yeltsin completed his new government line-up late on Thursday, naming Yevgeny Sidorov as minister for culture. The team includes one communist minister -- Aman Tuleyev, responsible for ties with the Commonwealth of Independent States. "For the first time in the last five years a communist, rather than a former one, has appeared in the Russian government," Pravda-5 newspaper wrote on Friday. Both Yeltsin and Prime Minister Viktor Chernomyrdin were Communist Party members. Yeltsin quit the party in July 1990, 17 months before the Soviet Union fell apart. 2087 !GCAT !GPOL !GVIO Isolated bursts of gunfire in Grozny at noon (0800 GMT) on Friday marked the start of a new truce, the result of a deal struck the day before by the Kremlin's envoy in Chechnya and the rebel chief-of-staff. But separatist fighters and Russian soldiers said the ceasefire was generally observed. Russian generals vowed to start pulling out troops from Grozny and other areas, as agreed by Moscow's Alexander Lebed and Chechnya's Aslan Maskhadov. "There has been some shooting from their side but it has been relatively quiet," said fighter Aslan Shabazov, a bearded man wearing a white T-shirt and camouflage trousers. "The ceasefire is being observed," echoed Russian woman soldier Svetlana Goncharova, 35. Lebed still has to defend his deal before a reclusive President Boris Yeltsin and the Russian public. He returned to Moscow promising to be back in Chechnya on Saturday to sign an agreement on bilateral relations between Moscow and Chechnya. Lebed said he would brief Yeltsin, who last week gave his security supremo sweeping powers and ordered him to end the 20-month conflict promptly. Lebed said he would detail the military deal he had signed and the planned political agreement. But Yeltsin's press office said no such meeting was scheduled for Friday and declined all comment on Lebed's deal. Hours before Lebed and Maskhadov signed the pact Yeltsin, in his first public appearance in two weeks, reprimanded his envoy for lack of progress. Yeltsin said in a televised interview he was not "fully happy" with Lebed's performance. Lebed, speaking overnight to Russian news agencies, dismissed the criticism and said he would not hesitate to use the powers to sack senior officials if they opposed his plan. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," he said. Yeltsin has said he wants peace but rejects rebel demands for full independence. Analysts doubt whether, after the humiliation of the army in this month's fighting, he will be willing to lose more face by making new concessions. Lebed, however, has said in the past he has no objection to Chechen secession if the region's one million people want it. Interfax news agency quoted separatist leader Zelimkhan Yandarbiyev praising the deal between Lebed and Maskhadov. "The Russian and Chechen peoples have been shown a real possibility, a real chance to stop sacrificing their finest sons in this senseless war," Yandarbiyev said. Russian generals, who earlier in the week threatened to bomb Grozny, said on Friday they were ready to begin pulling troops from rebel-held southern mountain districts and setting up joint patrols in rebel-held Grozny. "Preparations are going on now for the withdrawal of units from southern districts of the republic to the Chechen plain," Interfax quoted a Russian military official in Chechnya saying. General Vyacheslav Tikhomirov, the Russian commander in the region, was due to meet Maskhadov on Friday afternoon. Interfax said Russian forces were obliged under Lebed's agreement to leave a number of southwestern districts by Monday and quit the southern Shatoi district by Thursday, August 29. "Meeting these deadlines is very hard, so we made a start on withdrawing troops without delay," the military official said. Salman, the rebel field commander for Shatoi, told Reuters correspondent Dmitry Kuznets that the local Russian commander, who had already received his orders from headquarters, would begin pulling his men out on Saturday. Army and rebel officials said preparations were under way to form joint monitoring units with the guerrilla forces in Grozny to police the city and separate the warring sides. The units were to start operating at 3 p.m. (1100 GMT). Russian servicemen reacted sceptically to the idea of patrolling Grozny shoulder to shoulder with the separatist fighters who have had them in their gunsights for the past two weeks during the worst fighting since the early days of the war. "We have to try it, but I doubt if this is possible with the separatists," Goncharova said. The separatists, who swept into Grozny on August 6, still control large areas of the city. Russian troops are based at checkpoints on the approach roads. 2088 !GCAT !GDIP Croatia and Serbian-led Yugoslavia prepared to sign a landmark accord on mutual recognition on Friday, ending five years of wartime hostility. Croatian Foreign Minister Mate Granic met his Yugoslav counterpart Milan Milutinovic to work out final details of the agreement before a planned signing ceremony in Belgrade. Yugoslav officials postponed the ceremony, originally scheduled for midday (1000 GMT), for later in the afternoon because the two sides needed time to resolve one last issue. Granic, who led the delegation from Zagreb, drove through Belgrade in a limousine carrying a Croatian flag -- the first time the Croatian banner has been unfurled on Yugoslav territory since the federation collapsed in 1991. Earlier, the Yugoslav government endorsed the text of the agreement on normalising relations between the two countries, the state news agency Tanjug reported. "The government assessed the agreement as a crucial step to resolving the Yugoslav crisis, ensuring restoration of peace in former Yugoslavia," it said. The agreement sets long-term foundations for the development of relations and cooperation between Yugoslavia and Croatia and "for resolving certain issues caused by the Yugoslav crisis". Last-minute talks this week on the legal fine print finally cleared the way for a treaty based on mutual recognition within internationally recognised borders and establishment of diplomatic relations, diplomats said. The pact ends five years of hostility after Croatia's declaration of independence from federal Yugoslavia. Western powers view mutual recognition between the two most powerful states emerging from old Yugoslavia as a crucial step towards a lasting peace in the Balkans. Granic on Thursday invited all members of diplomatic corps in Zagreb to inform them of Friday's event. Presidents Slobodan Milosevic of Serbia and Franjo Tudjman of Croatia agreed in Athens earlier this month to have their foreign ministers sign a recognition accord on August 23. Experts negotiating the treaty text have have been trying to resolve issues including a stubborn territorial dispute over the Prevlaka peninsula on the Adriatic coast, the legal succession to old Yugoslavia, war damages and protection for Serb refugees trying to return to Croatia. The main state-run Croatian newspaper Vjesnik said on Thursday three days of talks this week apparently yielded "understanding" on sticking points. "The agreement opens possibilities for achieving mutually acceptable solutions regarding territorial issues in further talks," the Yugoslav government said. Diplomatic sources here said the two sides agreed that Prevlaka was no longer a "territorial but a security issue". "This probably means that Prevlaka will remain Croatian but will be demilitarized," a western diplomat said. War broke out in 1991 after Croatia declared independence to escape creeping domination by Milosevic-led nationalist Serbs in the Balkan federation. Fighting spread to Bosnia when its Moslem-led government broke away in 1992. Minority Serbs armed by Milosevic seized almost a third of Croatia in the 1991 war but lost almost all of it to a Croatian army counter-offensive over U.N. truce lines a year ago. Eastern Slavonia, the last Serb-held enclave in Croatia, is due to revert to Croatian government rule next year after a transitional period under U.N. administration. 2089 !GCAT !GPOL !GVIO The Chechen capital Grozny was relatively calm on Friday morning as the Russian army and separatist guerrillas said they were preparing to put 20 months of war behind them and implement a ceasefire. The ceasefire, which came into effect at noon (0800 GMT), was agreed by Boris Yeltsin's envoy, Alexander Lebed, and the rebel commander on Thursday evening. "The Russian and Chechen peoples have been shown a real possibility, a real chance to stop sacrificing their finest sons in this senseless war," Interfax news agency quoted separatist leader Zelimkhan Yandarbiyev as saying. Lebed has returned to Moscow to brief the president on the deal and his plan to sign a political agreement this weekend. He threw down the gauntlet to opponents in the military and the Kremlin who, he said, want to wreck the peace. But thousands of Chechen civilians forced from their homes or into cellars by two weeks of heavy fighting after the rebels seized Grozny on August 6 may have to wait some time to know if Lebed can make his peace deal stick in Moscow. Lebed, who has a shaky political power base in Moscow, said he was acting "on behalf of Russian mothers whose sons have died and continue to die in Chechnya". He predicted opposition from "jingoistic patriots". Russian generals earlier in the week threatened to bomb Grozny in what Lebed called "a bad joke". But early reports on Friday said they were implementing orders to begin pulling troops from rebel-held southern mountain districts and setting up joint patrols in rebel-held Grozny. "Preparations are going on now for the withdrawal of units from southern districts of the republic to the Chechen plain," Interfax quoted a source at the Russian military command near Grozny as saying. The agency said Russian forces were obliged under Lebed's agreement to leave a number of southwestern districts by Monday and quit the southern Shatoi district by Thursday, August 29. "Meeting these deadlines is very hard, so we made a start on withdrawing troops without delay," the military official said. Army and rebel officials said preparations were under way to form joint monitoring units with the guerrilla forces in Grozny to police the city and separate the warring sides. The units were to start operating at 3 p.m. (1100 GMT). Separatist spokesman Movladi Udugov described Grozny, scene in the past fortnight of the worst fighting since the early months of the war, as fairly quiet in the approach to the ceasefire, with only sporadic shooting. He told Reuters this came mainly from Russian snipers who had lost radio contact with their base. Udugov denied an Interfax report that at least 50 Russian soldiers were killed late on Thursday in a battle in Grozny. Interfax quoted the army command as saying there was virtually no fighting in the city on Friday morning. Army positions had been fired on 19 times overnight in the region, including 13 times in the capital. Lebed, speaking to Russian news agencies overnight, dismissed Yeltsin's criticisms of him in the past week and insisted he would not hesitate to use the powers the president gave him to sack senior officials if they opposed his plan. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," he said. Yeltsin's press office could not confirm Lebed's statement that he would meet the president on Friday morning. Kremlin spokesmen had no comment on the truce nor on Lebed's plan to return to Chechnya in two days to sign a "political document" on bilateral relations between Russia and Chechnya. Yeltsin says he wants peace but rejects rebel demands for full independence from Russia. Analysts doubt whether, after the humiliation of the army in this month's fighting, he will be willing to lose more face by making new concessions. Lebed, however, has said in the past he has no objection to Chechen secession if the region's one million people want it. 2090 !GCAT Here are highlights from Polish newspapers this morning. RZECZPOSPOLITA - According to an agreement by the Three-party Commission for Socio-Economic Affairs comprised of the government, trade unions and employers, Poland's public sector workers in February 1997 will get a one-time payment of 16.3 zlotys to make up for inflation this year. - Germany's Pfeifer & Langen sugar giant opened a new company in Poland on Thursday with a founding capital of one million zlotys. - Poland's Agricultural Market Agency (ARR), the food market regulator, and other economic institutions say pork prices will rise in the next few months. - In June next year NATO will decide on Poland's joining the pact, Defence Minister Stanislaw Dobrzanski said. - F-16 Falcon, F-18 Hornet and Mirage 2000 fighter aircraft will be presented at the Bydgoszcz International AeroInterLot'96 Fair on Friday, as Poland wants to modernise its airforce. - The governing coalition led by former communists put down the opposition Union for Freedom's (UW) mass-media rights bill, which was endorsed by other opposition parties and sought to update older legislation passed in 1984. The UW bill "was not worth consideration," coalition deputies said. - According to Walter Catlow, president of US-based Ameritech International, the firm wants to keep its engagement in the Centertel analogue cellular telephone company but it is extremely worried by recent activities of the main shareholder, Telekomunikacja Polska SA, which could lead to Centertel's disintegration. NOWA EUROPA - Two construction sector firms, Melnox and Atlantis, will start operating in the SSE Europark Mielec special economic zone, the Industrial Development Agency's (IDA) Mielec branch director Mariusz Bledowski said. - The IDA plans to form an investment fund which will group Polish shoemaking and leather producing firms and eventually list its stock on the Warsaw bourse, IDA president Arkadiusz Krezel said. - Negotiations on the sale of up to 75 percent of the Polski Handel Spozywczy (PHS) food retail and wholesale chain will soon be concluded, privatisation ministry spokesman Jerzy Godula said. GAZETA WYBORCZA - The opposition centrist UW fully supports the demands voiced by the association of owners of homes built on Poland's former German lands. The association's members demand full land property rights and fear possible claims by the previous German owners following Poland's entry to the European Union. - Poznan-based Wielkopolski Bank Kredytowy (WBK) will receive a 10-year loan of 8.6 million zlotys to buy a branch of Bydgoski Bank Budownictwa construction bank. - According to Powszechny Bank Gospodarczy (PBG) President Andrzej Szukalski, PBG and the other banks to join the Pekao SA banking group should preserve their identity. But Szukalski's statement has not prevented ever more PBG staffers from leaving the bank. ZYCIE WARSZAWY - The government wants to liberalise regulations on lotteries and gambling in expectation of increased tax revenues thought to go up by 320 million zlotys after liberalisation. - The Daewoo FSO car plant wants to introduce a new passenger car model to be produced alongside the Polonez model to increase the plant's employment, Daewoo FSO spokeswoman Krystyna Danilczyk said. PARKIET - On September 16 the Warsaw bourse will start continuous trade in shares of Bank Slaski, Bank Rozwoju Exportu (BRE), and the Stalexport, Budimex and Universal foreign trade companies. - Poland's industrial output in July exceeded by 10 percent the results in the same period last year, according to Central Statistical Office data. - Lodz-based PBG bank's net profit in the first half this year reached 71.8 million zlotys, representing 60.6 percent of its forecasted annual profit. -- Warsaw Newsroom +48 22 653 9700 2091 !GCAT !GPOL !GVIO Russian security supremo Alexander Lebed, claiming full command of military operations in Chechnya, was expected to meet Boris Yeltsin on Friday to seek approval of the ceasefire he hopes will bring peace to the rebel region. The ambitious reserve general, whose political career could depend on his success in Chechnya, said he would meet the president to discuss proposals including a ceasefire negotiated by him to begin at noon (0800GMT). The Kremlin could not confirm the meeting. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," Interfax news agency quoted him as saying on his return to Moscow after talks in Chechnya with separatist leaders. But the chain of command has been far from clear in recent days and it will take tough words from Yeltsin to convince Russia's military hawks, humiliated by the rebels' seizure of Grozny, that they should give Lebed a chance. The signs are not encouraging so far. Yeltsin, who gave Lebed special powers to resolve the Chechen crisis earlier this month, criticised the former paratroop general on Thursday in his first television appearance since he was inaugurated for a second term two weeks ago. "He always promised to solve the Chechnya problem if he had power. Now he has power. But unfortunately the results of his work are not yet obvious," Yeltsin said of Lebed. "But we will not despair. We will take the issue to the end." Izvestia newspaper said the criticism raised serious questions and it hinted that the president was out of touch. "Either the president is still demanding the impossible -- the restoration of legal order in Chechnya as it was on August 5, or he is judging the activities of his security adviser on the basis of the siuation before Lebed's last trip to Chechnya," Izvestia said. Chechen fighters seized much of Grozny on August 6. Lebed travelled to Chechnya on Wednesday and said he had ordered the Russian military to halt a planned assault on the capital Grozny after 11th-hour talks with rebel leaders. The Chechens, who seek independence for their Caucuasus territory, have said they can do business with the general. Lebed, then commander of the 14th Russian Army, made his name as a peacemaker in Moldova's breakaway Dnestr region and was appointed Yeltsin's security adviser as a vote-winning move between the two rounds of the Russian presidential election. Lebed had captured 15 percent of the first-round vote, taking third place behind Yeltsin and the communist runner-up. But Yeltsin virtually disappeared from sight soon after the first round on June 16, prompting speculation that he was ill. Aides have denied all the rumours and press spokesman Sergei Yastrzhembsky told Izvestia the president was "lively and dynamic" after a two-day break to the northwestern lakeland. Komsomolskaya Pravda, in a special report from the region, said Yeltsin had gone fishing and boating and played billiards during his two-day stay. A Russian newspaper said on Friday the president would soon receive treatment at a special Moscow clinic, but Yeltsin's office denied the report. The daily Nezavisimaya Gazeta, quoting a source in the Kuntsevo medical centre on the outskirts of Moscow, said two wards equipped with the most sophisticated medical equipment had been set up ready for the president. "I can deny this information," Yeltsin's press office said. Yeltsin completed his new government line-up late on Thursday, naming Yevgeny Sidorov as minister for culture. The team includes one communist minister -- Aman Tuleyev, who is responsible for relations with the Commonwealth of Independent States. "For the first time in the last five years a communist, rather than a former one, has appeared in the Russian government," Pravda-5 newspaper wrote on Friday. Both Yeltsin and Prime Minister Viktor Chernomyrdin were Communist Party members. Yeltsin quit the party in July 1990, 17 months before the Soviet Union fell apart. 2092 !GCAT These are some of the main stories in Sofia newspapers today. Reuters has not verified these stories and does not vouch for their accuracy. 24 CHASA -- Bulgaria's cabinet approved the sale of up to 75 percent of the debt-ridden Plama oil refinery, initially slated for liquidation, Privatisation Agency's executive director Vesselin Blagoev said. @ -- Bulgaria has failed to meet some of the targets, set in its reform programme agreed with the International Monetary Fund last month, central bank governor Lyubomir Filipov said after talks with the IMF mission head Anne McGuirk in Sofia. -- Two former directors of the Arsenal military plant had been arrested in the southern town of Stara Zagora, the newspaper said without specifuying what charges were brought against them. PARI @ -- The government reduced the stakes for voucher sell-offs in 60 state firms slated for privatisation, Privatisation Agency's executive director Vesselin Blagoev said. -- The European Union said it would transfer 40 million European currency units to the Bulgarian National Bank (BNB) on August 29 under a balance of payments agreement signed in 1994, the BNB said. STANDART -- One Romanian woman was killed and 15 people were injured in a crash near the northern town of Rousse when a Romanian bus collided head on with a Bulgarian one. @ -- Electricity prices are expected to rise by 14-17 percent in September, energy minister Roumen Ovcharov said. -- Bulgaria's budget deficit rose by 1.2 billion levs to 69.727 billion levs in the first half of August, which is 86.4 percent of the year's target set in the revised budget, the finance ministry said. -- Sofia Newsroom, 359-2-876032 2093 !GCAT DELO - Electricity distributor Elektro Slovenija said it appealed to all its customers to save electricity because supply could be effected due to damage at one part of its power plant Sostanj. - The Slovenian state Payment Agency has appealed after a court decision that it had to give up a part of its premises to the newly-established state Auditing Agency. - Slovenia's centrist Democratic Party, currently holding four out of 90 parliamentary seats, said it expected to gain seven percent of seats in the general elections scheduled to take place by December this year. - The left-wing United List of Social Democrats said the government should reduce unemployment and increase minumum wage. DNEVNIK - Slovenian President Milan Kucan is expected to begin a second round of talks with parliamentary parties before fixing the date for a general election. According to Slovenian legislation, elections should take place between October 27 and December 8. REPUBLIKA - Parliament is expected to end its debate on a new proposal for the law on bankruptcies in September. 2094 !GCAT HOSPODARSKE NOVINY - Steel producer VSZ has discussed possible ways of cooperation with the Chinese firm Yunnan Tin Corporation and with Pohang Ironand Steel Co of South Korea. - The overall volume of loans from commercial banks increased by some 18.99 billion crowns, or six percent, in the first half of the year to total around 307.1 billion as of June 30. - Some 98 agricultural firms worth around 12.3 billion crowns, have so far been privatised in the second privatisation wave. The total number of agricultural companies slated for the second wave was 250, with property estimated to be worth some 66.5 billion crowns. - Revenues from the sale of water totalled 1.1 billion crowns in the first half of this year, some 4.2 percent less than in the same period last year. - The overall area sown with oil plants (rapeseed and sunflower) in Slovakia totals about 130,000 hectares. The country's consumption would require the area to increase at least to 160,000 hectares. PRACA - The paper quotes Russian oil sources as saying the manager-employee joint-stock company Slovintegra, which holds 39 percent in oil refiner Slovnaft, has already paid off the remaining 900 million crowns of the total sum of one billion, for the stake bought from the National Property Fund. SME - The paper writes VSZ now controls about 45 percent in Dopravna Banka. PRAVDA - Slovak opposition parties are preparing joint proposals for personnel reconstruction at the supervisory bodies controlling the Slovak Inteligence Service (SIS) and the National Property Fund (NPF) -- the state privatisation agency. -- Bratislava Newsroom, 42-7-210-3687 2095 !GCAT !GVIO The Russian army in Chechnya said it was preparing on Friday to withdraw from the rebel-dominated southern mountains of the region as part of a peace deal reached with the separatists a day earlier. Interfax news agency quoted a source at the military command near the capital Grozny as saying: "Preparations are going on now for the withdrawal of units from southern districts of the republic to the Chechen plain." Alexander Lebed, President Boris Yeltsin's envoy to Chechnya, signed the deal with the separatist command on Thursday after overriding orders by Russian generals in the region for the bombing of the rebel-held capital. Interfax said Russian forces were obliged under the agreement to leave a number of southwestern districts by Monday and quit the southern Shatoi district by Thursday, August 29. "Meeting these deadlines is very hard, so we made a start on withdrawing troops without delay," the military official said. Interfax and Itar-Tass quoted army officials as saying preparations were also under way to form joint monitoring units with the guerrilla forces in Grozny to police the city and oversee the moving apart of the warring sides. Tass said the units would drawn half from the Russian forces and half from the separatists. A joint command post would be set up at the village of Starye Atagi, about 20 km (12 miles) south of Grozny and close to Novye Atagi, where Lebed signed the truce with rebel chief-of-staff Aslan Maskhadov. Rebel spokesman Movladi Udugov told Reuters the separatist side was also making its preparations for the joint structure. He added that was little fighting in Grozny ahead of the new ceasefire, which is due to go into effect across the region at midday (0800 GMT). The main firing, he said, came from Russian snipers who appeared to have no communication with their bases. Interfax quoted the army command as saying there was virtually no fighting in Grozny on Friday morning. Army positions had been fired on 19 times overnight in the region, including 13 times in the capital, it said. An interior ministry spokesman told Tass one of its servicemen had been shot dead in Grozny overnight and an unknown number were wounded. 2096 !GCAT HOSPODARSKE NOVINY - "Anheuser-Busch's demands are unrealistic and we are not in a situation where we would have to privatise this firm," Agriculture Minister Josef Lux said. - Shoe production is now at half of 1989 levels. For the first time since 1989, imports of shoes are exceeding exports. MLADA FRONTA DNES - The American Federal Bureau of Investigations (FBI) is sending an agent to Prague by the end of this year to help Czech police in the fight against organized crime and international terrorism. - Six to eight health insurance companies are considering a merger in order increase chances of survival. LIDOVE NOVINY - Expenditure cuts in this year's state budget may be considerably higher than the 9.3 billion crowns predicted by the Ministry of Finance. One reason is that customs offices lost more than two billion crowns due to the bankruptcy of Kreditny Banka Plzen and this was not accounted for in the ministry's estimate. PRAVO - The sale of 500,000 hectares of state land is expected to begin next year and to last for 10 years. Currently parliament is working on a version of a law to control the sales, which should be passed by the end of this year. -- Prague Newsroom, 42-2-2423-0003 2097 !GCAT !GPOL !GVIO Russian President Boris Yeltsin, returning to work after a two-day break that fuelled speculation about his poor health, turns his attention on Friday to a truce hammered out by his security chief with Chechen rebels. Yeltsin's involvement has become paramount after Alexander Lebed, whom he ordered to bring a swift end to the 20-month Chechnya war, agreed with rebel chief Aslan Maskhadov to withdraw Russian troops from the devastated regional capital Grozny and later from the rest of Chechnya. Yeltsin, 65, who has been little seen in public since late June, used a televised interview on Thursday to demonstrate his sound health, good humour and firm command over the Kremlin. "Rumours circulate about my (possible) trip to Switzerland," Yeltsin told RIA news agency, referring to reports he planned to travel abroad for heart surgery. "Thanks to the press for the invitation but I cannot go as there are problems which should be solved here," he said. "If I take my leave, I will spend it on Russian territory." To dispel the rumours, Yeltsin's press office issued a statement saying the president, who was last seen in public at an inauguration ceremony on August 9, had spent two days beside a a lake in northwestern Russia. He returned to Moscow on Thursday. The Chechnya ceasefire is due to start at midday (0800 GMT) on Friday. Lebed and Maskhadov agreed to set up joint military administration for Grozny, much of which had been under rebel control since August 6. Lebed said he expected a mixed reaction to the deal, which could be seen by many his opponents as a national humiliation. "I predict attacks by jingoistic patriots and jingoistic democrats for signing the accord," he said. Lebed will need Yeltsin's backing even more if he goes ahead with his plans to strike a political deal with the rebels. Lebed said after talks with Maskhadov that he would come back in two days with a draft political agreement that would specify the future political status of Chechnya -- the root of the conflict. Moscow has persistently rejected any discussion of Chechnya's independence as sought by separatists. Soon after his appointment to the Chechnya post earlier this month, Lebed said both sides should be flexible. Just hours before Lebed and Maskhadov signed Thursday's deal, Yeltsin reprimanded Lebed for a failure to achieve results and said he was not entirely satisfied with his performance in Chechnya. The Kremlin leader was busy on Thursday finalising the formation of a new government. Television showed him chatting to one of several government ministers named on Thursday -- health minister Tatyana Dmitrieva, the only woman in the new cabinet. Among the others appointed was Siberian communist Aman Tuleyev, who briefly ran against Yeltsin in the June presidential election before stepping down in favour of communist party leader Gennady Zyuganov, the eventual runner-up. Prime Minister Viktor Chernomyrdin, confirmed in office this month by a parliament where communists are the biggest group, had pledged to broaden his administration. The government held its first meeting on Thursday. Ministers approved a tight draft budget for 1997, which new Finance Minister Alexander Livshits said was needed to ensure some slight growth in the economy. Yeltsin assured Russians better times were on the way after the economic hardships of the past half decade. 2098 !GCAT !GPOL !GVIO Peace seemed closer in battered Chechnya as Russian and separatist commanders implemented a truce and President Boris Yeltsin finally gave his public blessing to talks aimed at a political solution. The two sides said they plan to start pulling back forces in the heavily damaged capital Grozny on Saturday and form joint military patrols to enforce the new ceasefire. The truce came into effect at noon (0800 GMT) on Friday, rekindling hopes for an end to the 20-month-old separatist conflict only days after some of the heaviest fighting. Russian security chief Alexander Lebed pressed on with his peace plan armed at last with Yeltsin's public approval. Itar-Tass news agency reported that Lebed briefed Yeltsin by telephone on Friday in Moscow and the president gave the former paratroop general the go-ahead to seek a political solution in talks with leaders of the Chechen separatist guerrillas. Lebed, who got sweeping powers as Yeltsin's special adviser in the breakaway republic, had signed the military agreement with rebel chief-of-staff Aslan Maskhadov. Now he is drafting the broader political agreement and was expected to return to the region this weekend. Military leaders on Friday held a relaxed meeting in southern Chechnya and declared they were in total agreement. "Today we were unanimous. We discussed all the problems, all the questions which we had...from tomorrow we will start putting things into practice," the commander of Russian forces in Chechnya, Vyacheslav Tikhomirov, said after the meeting. "We are absolutely sure we are on the right path." Maskhadov said Russia's clear decision to stop the war had made all the difference. "It is difficult to talk to each other when you don't know if they want to end the war," the rebel chieftain told reporters after sitting down with Tikhomirov for talks filmed by Russian television. The peace breakthough came after Russian troops had threatened to flatten the Chechen capital Grozny, most of which the rebels captured on August 6. The truce appeared to take hold, although scattered exchanges of fire indicated there were still those on both sides reluctant to stop fighting. Yeltsin's approval removed major uncertainty from Lebed's initiative. The president had seemed to be avoiding meeting his envoy, leaving Lebed's authority doubtful and the Kremlin chain of command unclear. Yeltsin's backing had been seen as crucial for Lebed, a novice in Kremlin intrigue who has said he expects strong resistance to a deal some in Moscow might consider a national humiliation. The Russian president still seems no nearer to conceding full autonomy to the Chechens. His press service said he had empowered Lebed to hold talks aimed at an accord defining Chechnya as an integral part of the Russian Federation. Yeltsin has said he wants peace but rejects full independence. Lebed has said in the past he has no objection to Chechen secession if the region's one million people want it. Russian public television said that Russian forces would leave Grozny between Saturday and Wednesday and that rebel units would also withdraw. Russian and rebel commanders in Shatoi, about 50 km (30 miles) south of the capital, told Reuter journalist Dmitry Kuznets a Russian division would withdraw on Saturday, the start of a larger Russian pullout from the region. The two commanders said they would meet again on Saturday. Maskhadov said the idea was for the military to take control of the situation and not allow any provocations on either side. He and Tikhomirov appeared confident that this ceasefire, unlike previous ones, would develop into an end to the conflict. But Tikhomirov said that they had to be wary of the mysterious "third force" which had crushed all previous attempts to reach peace. 2099 !GCAT !GPOL !GVIO Russian President Boris Yeltsin on Friday backed security supremo Alexander Lebed's efforts to bring peace to Chechnya and gave him permission to go for a political solution, Itar-Tass news agency reported. Lebed briefed Yeltsin on his efforts in the breakaway region by telephone at 10 p.m. (1800 GMT), the presidential press service told the agency. Lebed on Thursday secured a military deal with the rebels that included a ceasefire, which on Friday seemed to be holding, rekindling hopes for an end to the 20-month-old war. The former paratroop general was expected to fly back to Chechnya at the weekend to agree with rebel leaders a document on the status of the region and Yeltsin's backing should strengthen his hand. But the Russian leader gave no indication he was ready to concede anything on the separatist demand for full autonomy. The presidential press service said Yeltsin had empowered Lebed, who he has appointed his envoy to Chechnya, to hold talks aimed at a political accord defining Chechnya as an integral part of the Russian Federation. 2100 !GCAT !GPOL !GVIO !GVOTE U.N. officials expressed concern on Friday over a pattern of political violence in northwestern Bosnia before post-war elections but said Moslem police had pledged to halt abuses in the area. Political opponents of the ruling Moslem nationalist SDA party have been subjected to threats and violence in Cazin repeatedly in the run-up to nationwide polling on September 14. International Police Task Force (IPTF) officials have accused local police of standing by and allowing the incidents to occur and of failing to investigate them properly afterward. Alex Ivanko, spokesman for the international police, said two more politically motivated explosions were reported in the Cazin area in recent days. But Ivanko told reporters the IPTF had won a commitment from the government police commander in the Bihac canton "to ensure that there are no such incidents in the future". He said the Bosnian police official had promised to mount more night patrols and to dismiss the chief of police in Cazin as well as the head of criminal investigations there. Opposition leader Haris Silajdzic, a former Bosnian prime minister, was attacked with a metal pipe at a rally in Cazin earlier this summer. International election monitors said members of the SDA were responsible for the attack. Kris Janowski, spokesman for the office of the U.N. High Commissioner for Refugees (UNHCR) in Sarajevo, said his agency was disturbed by the climate of political violence in Bihac. "The UNHCR is very concerned about the rising political violence and intimidation in Bihac, which is often directed against returning refugees," Janowski said. "Sadly, Bihac today stands out as the scene of the most violence in the (Bosnian Moslem-Croat) federation." The UNHCR also slammed Serb authorities over a number of human rights abuses against non-Serbs, blocking free movement for civilians less than a month before the September vote. Janowski reported a "continuing contempt for the rights of minorities" in Bosnia's Serb republic, listing a series of incidents which violate the letter and the spirit of the Dayton peace agreement. He said the Serb violations include: -- trying to turn the administrative boundary line between the Moslem-Croat federation and the Serb republic into an international border. -- requiring Moslems and Croats from Serb-held Teslic who want to visit the federation to secure a re-entry permit from local police. -- requiring those persons visiting the Serb republic from the federation to inform police and remain only five days. -- making citizens of third countries with Moslem or Croatian names to pay a visa fee of 45 German marks ($30) even though they had already entered Bosnia. -- preventing 11 Moslem families evicted from their homes in the Banja Luka area two months ago from returning and threatening others in that area with eviction. -- blocking dozens of "assessment visits" in which Moslems and Croats tried, with UNHCR assistance, to return to their former homes in the Serb republic to determine whether it would be possible to move back permanently Serb nationalist leaders oppose reunification in Bosnia and want a separate, sovereign territory linked to Serbia. 2101 !GCAT !GREL !GVIO Saboteurs blew up a Serb orthodox church in southern Croatia on Friday with a blast which also damaged four nearby homes, the state news agency Hina reported. HINA said the church in the small village of Karin Gornji, 30 km (19 miles) north of Zadar, was destroyed by the morning attack. It did not report any casualties. Zadar police said in a statement they had launched an investigation and were doing their best to find the perpetrators. HINA said it was the first time an orthodox church had been blown up in the Zadar hinterland, where a large number of Serbs lived before the 1991 war over Croatia's independence from the Yugoslav federation. The area was part of the self-styled state of Krajina proclaimed by minority Serbs in 1991 and recaptured by the Croatian army last year. Up to 200,000 Serbs fled to Bosnia and Yugoslavia, leaving Krajina vacant and depopulated. 2102 !GCAT !GODD Poland's famous cavalry is set to ride again, if a group of enthusiasts who met in Warsaw on Friday has its way. They formed an association which aims to train and equip a cavalry squadron and then offer it to the Defence Ministry for use on ceremonial occasions, PAP news agency said. Deputy Prime Minister Roman Jagielinski was elected president. The association also includes other parliamentary deputies from his co-ruling Peasant party, army officers and cavalry veterans as well as amateur riders. Poland's dashing Ulans last won renown by holding out for a month against an invasion by mechanised Nazi German forces and then by Soviet troops in 1939. Poland's communist rulers abandoned the long cavalry tradition in favour of tanks after World War Two. The army is now struggling to modernise, on a low budget, and has no horse-borne troops for ceremonial purposes. "We hope that many people will rally round the squadron, especially former cavalrymen and Ulans -- people who have long cherished this dream but did not have the means to carry it out," group secretary Lieutenant-Colonel Zbigniew Radon said. Radon said it planned to employ former cavalry officers to train serving soldiers at Warsaw's military LEGIA riding club, which he runs, and equip them with horses and 1936-style uniforms with money raised from donations and subscriptions. Army and Defence Ministry spokesmen were not immediately available for comment. 2103 !GCAT !GVIO It was high noon in the Chechen capital Grozny on Friday but the gunmen decided not to draw. A ceasefire had just taken effect. A few Russian military helicopters circled overhead firing the occasional flare. Separatist rebels patrolled the streets and hundreds of refugees took advantage of the lull to revisit their homes. Few people believed that the relative calm would last long. After almost two years of war, the cemeteries in this rebellious North Caucasus region are full of mothers crying over freshly-dug mounds. Aisa Abdulazimova, 42, was tending the grave of her only son against a background of thick black smoke billowing up from fires in oil storage areas of Grozny's main industrial zone. "Look at that, they have no thought for the mothers," she said, weeping as she remembered her 23-year-old son who was killed early last year in the first weeks of the war. "They never stop digging here." Tens of thousands of people have been killed since Moscow sent troops to Chechnya in December 1994 to crush its three-year bid for independence. Hundreds perished in a rebel offensive on Grozny this month, and the fight isn't over yet. Russian security chief Alexander Lebed struck a peace deal this week with rebel chief-of-staff Aslan Maskhadov, but warriors on both sides still have itchy trigger fingers. In Grozny, bearded rebel fighters wielding Kalashnikovs and grenade-launchers remained in control of much of the city. But tension was high and occasional firefights broke out even within minutes of the midday truce starting. A T-72 tank, captured from the Russians eight days ago, stood in a courtyard at a rebel base next door to a city hospital. The loud hammer of a machinegun nearby sent some of the rebels scurrying to return fire. Others shrugged it off and continued to play backgammon. "There has been some shooting from their side, but it has been relatively quiet," said rebel fighter Aslan Shabazov, in camouflage trousers, a white shirt and sunglasses. The tank, flying the green rebel flag with its black wolf insignia, then swung into action with a roar of its engines, almost knocking down a tree as it reversed out of the yard throwing up a cloud of dust. There was a sporadic crack of gunfire from the other side of an adjacent building. Then it all fell quiet. "We are silent, and they are fighting," Shabazov said. Inside the rebel headquarters, Moslem fighters rested on beds or on the floor. Some drank tea, others listened to music. One 18-year-old, Isa Usupov, recited a poem about the laws of war. "Blood for blood. Kindness for kindness," he said, ending the verse with three chants of "Allahu Akbar" (God is Greatest). Lyona Eldukayev, 35, stood smoking in the yard with the pockets of his camouflage waistcoat stuffed with grenades. "Yesterday and today have been relatively calm," he said. Elsewhere in the city, there was a tense moment just minutes after midday at a Russian checkpoint. Andrei, one of the soldiers manning the post, told journalists that the ceasefire was being observed. As he spoke, a group of about 10 separatists, armed to the teeth, jumped out of two passing cars. "What's going on here?" asked a rebel commander who identified himself as Jandar. Andrei quickly retreated behind the sandbags of his checkpoint as the rebels advanced menacingly. "Bring your commander out here," Jandar shouted. But Andrei said he was not there and the rebels left without a shot being fired. 2104 !GCAT !GCRIM !GDIP !GVIO The U.N. war crimes tribunal for former Yugoslavia opened an office in Belgrade on Friday, marking what deputy prosecutor Graham Blewitt called a new Yugoslav commitment to cooperate with its work. Both the United Nations and tribunal prosecutors complained in the past that Belgrade had failed to help track down indicted war criminals and allow investigators to work here. Blewitt told a news conference: "I'm pleased to say that I've been given an assurance from the Federal Republic of Yugoslavia that they are prepared to cooperate in accordance with their international obligations to which they are a party, including the statute of the tribunal." Under the Dayton peace agreement for Bosnia and a number of U.N. Security Council resolutions, Yugoslavia -- now consisting of Serbia and Montenegro -- is legally obliged to help the International War Crimes Tribunal for Former Yugoslavia (ICTY). Only after months of intensive negotiations at the U.N. in New York did Yugoslav authorities allowed The Hague-based tribunal to open the Belgrade office to coordinate investigations. "The written agreement will allow prosecutors to send investigators into Yugoslavia to conduct interviews and inquiries," he said. "It also guarantees freedom of movement of prosecutors' staff and gives access to central and local authorities." But the deputy prosecutor also sounded a note of caution. "Beyond that, it is only a question of waiting to see what future developments will be." Despite paying lip service to support for the tribunal, Yugoslavia has yet to extradite Serb suspects to The Hague. One of the most prominent figures wanted by the tribunal on genocide charges, Bosnian Serb army commander Ratko Mladic, made a very public appearance in May at a funeral in Belgrade. Serb authorities have also refused to extradite four Yugoslav army officers accused of murdering 200 civilians in the 1991 battle for Vukovar in eastern Croatia. "Obviously in our dialogue with the Belgrade government we will remind them that obligations do exist and that there is an expectation that they will honour their obligations to arrest and surrender those accused," Blewitt said. But one Western diplomat said he doubted Yugoslavia "has changed its spots". "I can't really see them bending over backwards to help the tribunal now. They may have signed the deal, but that doesn't mean they are going to reverse the trend of the past year." The ICTY was set up by the U.N. Security Council in May 1993 and has jurisdiction over individuals accused of war crimes, genocide and crimes against humanity. It is the first such international body set up to prosecute war crimes since the Nuremberg and Tokyo trials held after World War Two. It has indicted 75 suspects, including 54 Serbs, 18 Croats and three Moslems, although it holds only seven in its cells. Apart from Mladic, the most prominent figure wanted by the tribunal is former Bosnian Serb leader Radovan Karadzic. Both are still at large in the Bosnian Serb republic. Although the tribunal has a team of investigators, it has no powers of arrest and relies instead on local authorities to hand over the accused. While the majority of those indicted are Serbs, Blewitt also insisted that by opening an office in Belgrade, the ICTY would use the chance to investigate crimes against Serbs. 2105 !GCAT !GDIP Croatians showed mixed emotions on Friday over an accord to normalise ties with Serbia-led Yugoslavia, their former enemy, with some expressing fears the deal was hastily arranged and could turn out for the worse. "Everything that leads to peace is necessary. But still I am suspicious. I don't trust Serbs after all that's happened," said Domagoj Pejic, 33. Foreign ministers from Croatia and Yugoslavia earlier signed the mutual recognition accord in Belgrade, ending five years of crisis that followed Croatia's bid for independence. "It's high time this happened. Normalisation is necessary and there can't be any progress without it," said Franjo Saban, 26, a Zagreb student. But hatred and mistrust still run deep on both sides after years of hostile propaganda and a bloody conflict that displaced hundreds of thousands of civilians. Political analysts said important legal issues regarding refugees and amnesty had yet to be resolved and the accord would probably do little to improve the lives of ordinary Croats and Serbs in the near future. "I am not really enthusiastic. Too much blood has been shed for Croatia to allow today's signing. I would personally build a Chinese wall between us but Western forces are dictating otherwise," said taxi driver Ivan Tomljenovic. Croatia declared independence from federal Yugoslavia in 1991. But minority Serbs, fearing for their rights, proclaimed their own state of Krajina, armed and backed by the Yugoslav army. Most Croats were expelled from the Krajina region and hundreds of civilians were killed in a seven-month war that ended with a truce in January 1992. The Croatian army recaptured Serb-held territory a year ago, prompting an exodus of 200,000 Serbs to Bosnia and Yugoslavia, now comprising only Serbia and Montenegro. "The normalisation comprises a handshake over Croatian graves and the destruction of Croatian culture," wrote columnist Srecko Jurdana in the Nacional weekly. Some Croats, saying Belgrade was responsible for starting the war, said the deal was reached too quickly and did not force Yugoslavia to acknowledge its role in the conflict. "This process is fraught with unnecessary haste. We don't think the agreement should set no conditions (for Yugoslavia)," Zlatko Tomcic, leader of the peasant party, told Vjesnik daily. But, after so much suffering and violence, other Croatians said it was time to put the war behind them and move on. "Things eventually have to be solved. I therefore support the normalisation. People have to be able to go back to their homes, both Croats and Serbs," said Andjelka Rogosica, 32. If Croatians were less than enthusiastic about the accord, many Serbs in rump Yugoslavia expressed disgust. Opposition leaders accuse Serbian President Slobodan Milosevic of betraying the Serb minority in Croatia whose cause he once championed. "What kind of a stupid president makes a deal with the Croatian fascists?" said a Belgrade taxi driver. "What did all those people die for?" 2106 !GCAT !GVIO An imperfect silence settled over Grozny on Friday. Only sporadic shooting disturbed a ceasefire that brought relief to the beleaguered Chechen capital after two weeks of some of the worst fighting the region has seen. But hope of a lasting peace was dulled by a more ominous silence in Moscow, where the Kremlin refused to comment after Boris Yeltsin's envoy, Alexander Lebed, struck the ambitious truce deal with Chechnya's separatist rebels and vowed to return on Saturday to seal a political settlement. More, the president did not even seem ready to meet the man who, after less than a fortnight in charge, claimed to have put an end to the 20-month war which has ruined countless careers and once seemed likely to cost Yeltsin July's election. Just hours before Thursday's agreement in Chechnya, Yeltsin had even gone on television for the first time in two weeks to chide Lebed for his slow progress, prompting speculation he was either about to dump Lebed or was simply out of touch. The impression, not for the first time, is that Russian policy is adrift in Chechnya, where tens of thousands have died have since Yeltsin sent in troops in December 1994. Lebed flew back to Moscow from Chechnya early on Friday, saying he planned to brief Yeltsin on the truce and on the political pact planned for Saturday on relations with Chechnya. But the presidential press office denied the meeting. A Kremlin source later told Interfax news agency the two might meet, but not until next week -- only after a political accord. Yet there was no indication what political deal Lebed might be proposing and even less sign that he could sell it to Moscow. Lebed, an ex-general who owes his position to coming third in the first round of the presidential election in June, has won praise from the separatists for his conciliatory approach. He has said Chechen independence is not taboo for him. But it has always been the sticking point for Moscow. Despite the supposedly sweeping, though never publicly spelled out, powers given to Lebed by Yeltsin to end the crisis, there has been no indication that the Kremlin is ready to let him offer secession as an option -- least of all in the wake of the Russian army's humiliating loss of Grozny on August 6. That leaves nothing but theories about what is going on. Lebed himself says a "party of war" in Moscow is trying to sabotage his peace talks, possibly faking Yeltsin's orders while the president is indisposed. Aides deny the president is ill but he still looked stiff and slow on television on Thursday. Lebed reckoned this week's threat by the Russian army to bomb Grozny flat was a result of such scheming. For now, the Russian army generals seem to be going along with Lebed's plan to pull troops out of some districts in Chechnya. One variation on the simple power struggle theory is that Yeltsin still runs policy and is playing his various underlings off against each other to see which one is most successful. His refusal to meet Lebed may just be the classic tactic of retiring from the scene until it is clear who is doing best. If Lebed succeeds in saving peace with honour for Moscow, Yeltsin may welcome him back as a hero. If the general fails, his short political career may be over. Some cynics argue that the whole scenario of Lebed struggling alone against Kremlin intrigue and bellicose generals is a ploy to win him the rebels' confidence. Sergei Baburin, the leftist deputy parliamentary speaker told Reuters on Friday the week's chaos was just Lebed's "theatre", orchestrated to advance his own political career. 2107 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Bulgarian air traffic controllers have threatened to go on strike at the beginning of September to demand more pay, the chief of the Bulgarian association of air traffic controllers (Bulatka) said on Friday. "We will launch our strike in the beginning of September as now we are collecting signatures from those who will go on strike and then we will give (our employer) a week-long warning," Stefan Raichev told Reuters. The controllers are demanding the monthly wage be increased to $1,000 from some $230 per month, while traffic has increased 10 percent since last year, Raichev said. The director general of the air traffic service Valentin Valkov said if now controllers launch a strike it would be illegal. "A strike at this stage would be illegal as it breaks legal procedures," Valkov told a news conference on Friday. He said air traffic was congested during the summer with charter flights carrying foreign tourists to the Bulgarian Black Sea resorts. "I can not afford curbing the charter flights of our national carrier -- Balkan Airlines," Valkov said. He said he would collect the signatures of would-be strikers among the 1,380 traffic controllers and technicians in an attempt to prepare a schedule for their replacement. A construction of a new modern air traffic centre in Sofia is planned to start on March 1 next year, Valkov said, adding that it is expected to cost some $15-$20 million. In 1994 the European Investment Bank agreed to extend a 30 million ECU ($25 million) loan for improving the efficiency and capacity of Bulgaria's air traffic control system, Valkov said. The new centre will be built with funds of the Bulgarian side, while its equipment, which will be supplied by foreign firms, will be funded through the bank's loan, he added. -- Liliana Semerdjieva, Sofia Newsroom, 359-2-84561 2108 !GCAT !GDEF !GDIP NATO forces have completed the destruction of about 400 tonnes of contraband Bosnian Serb munitions and are cleaning up the demolition site, a NATO spokesman said on Friday. "The demolition phase of the operation was completed yesterday," said Lieutenant-Colonel Max Marriner, a NATO spokesman in Sarajevo. "The operation now moves into the clean up phase with the engineeers filling in the pits created by the demolitions, removing all the debris associated with an operation of this size and returning the site to its natural condition." The munitions were discovered by a routine NATO patrol on August 5 in a former schoolhouse in Margetici, near the eastern Bosnian town of Sokolac. Bosnia's formerly warring factions should have declared all military sites including weapons and ammunition storage sites to the NATO-led peacekeeping force in Bosnia several months ago. NATO therefore confiscated the large cache of mines and small arms ammunition and announced that it would destroy them, despite strenuous protests from the Bosnian Serbs. NATO troops dug blast pits deep into the ground in a remote site and blew up the munitions in relatively small lots through a series of controlled explosions over four days. The Bosnian Serbs complained about alleged environmental and health risks and their official media even alleged that NATO was sending nuclear waste to the site for destruction. Marriner said NATO would consider any documented claim for compensation for health-related or structural damage problems as a result of the operation, but so far it had seen none. "The people of Margetici are no longer living on top of a 400 tonne powder keg," he said. "If it (the ammunition dump) had gone off it would have knocked Sokolac into the next county." Marriner said he was particularly outraged by a report in the Bosnian Serb media alleging that even as NATO was destroying Serb ammunition it was transporting tanks and armoured personnel carriers into Bosnia for Moslems troops. "Such allegations, clearly for domestic consumption, are the actions of an army that knows it has been caught out fair and square by (NATO) diligence," he told reporters. "This shabby and transparent misinformation only serves to mislead the people of Republika Srpska (Bosnian Serb republic)." 2109 !GCAT !GCRIM !GDIP Germany and Poland agreed on Friday to tighten cooperation between their intelligence services in fighting international organised crime, PAP news agency reported. Interior Minister Zbigniew Siemiatkowski and Bernd Schmidbauer, German intelligence co-ordinator in Helmut Kohl's chancellery, sealed the closer links during talks in Warsaw. Ministry spokesman Ryszard Hincza told the Polish agency the services would work together against mafia-style groups, drug smuggling and illegal trade in arms and radioactive materials. 2110 !GCAT !GPOL !GVIO Russian President Boris Yeltsin, now back in the Kremlin after a two-day break, is likely to meet his security chief Alexander Lebed early next week, Interfax news agency reported on Friday. Itar-Tass news agency said Yeltsin was waiting for a written report on Lebed's latest trip to Chechnya, during which he said he sealed a ceasefire with the separatists and said he hoped to agree a political deal over the weekend. Western countries have already welcomed the agreements, saying they could help to end the bloodshed in the breakaway region. But Interfax, quoting Kremlin sources, said Yeltsin would meet Lebed after the latest "routine round" of negotiations had been completed. This would allow a more detailed report on the situation there. Lebed, Yeltsin's special representative in Chechnya, has visited the region three times for talks with separatist leaders and is due to go there again at the weekend. He had said he would meet Yeltsin at 12.30 p.m. (0830 GMT), just half an hour after the ceasefire was due to start. But Yeltsin's office said no meeting was planned for Friday. 2111 !E21 !E211 !ECAT !GCAT !GDEF Russian Defence Minister Igor Rodionov said on Friday defence spending had been cut too far in the draft 1997 budget and blamed other ministries, keen to have their own troops, of robbing the armed forces. Interfax news agency quoted Rodionov as saying his ministry's request -- for substantial funds for the armed forces -- had been ignored by the budget planners. "The budget request, drawn up on the basis of scrupulous analysis of the most urgent needs of the army and the navy, has not even been considered," said Rodionov, appointed to the post less than two months ago. President Boris Yeltsin, naming Rodionov for the job, ordered him to transform Russia's huge military force left over from the Soviet past into a smaller, more efficient professional armed force by 2000. Rodionov backed this idea but also insisted the military reform, which his predecessor Pavel Grachev had failed to start, needed proper funding. Interfax said the draft 1997 budget included 100.8 trillion roubles ($19 billion) for defence, well short of the 260 trillion roubles requested by the ministry. The draft budget provides for 511 trillion roubles of total spending. Rodionov, whose forces are battling separatists in breakaway Chechnya, said reducing the number of other troops controlled by different ministries could be an extra source of cash for the armed forces. The Russian Interior Ministry, the Ministry for Emergency Situations, the federal security service, the federal borderguard service and a number of others all command troops, totalling more than those in the army and navy. Interior Ministry troops are also active in Chechnya. "There are several parallel armies in the country," Rodionov said. "They consume a growing amount of resources and often fail to carry out their duties. Here is the source of saving state funds." 2112 !GCAT !GDIP !GVIO The restoration of relations between rump Yugoslavia (FRY), comprising Serbia and Montenegro, and Croatia ends five years of crisis following the disintegration of the former Yugoslav federation. Here is the chronology of events that first destroyed the multinational union of former Yugoslavia, and later helped the two neighbours normalise relations after a seven-month war between rebel Serbs and Croatian government forces. May 4, 1980 - Yugoslav leader Josip Broz Tito dies, signalling the beginning of the Communist Party's decline and opening the way for the rise of nationalism and disintegration of the country. June 28, 1989 - Serbian Communist Party leader Slobodan Milosevic addresses Serbs at Kosovo Polje on 600th anniversary of defeat of medieval Serb kingdom by Turks. The speech helped launch a revival of Serbian nationalism, raising tensions between the six Yugoslav republics. 1991 March 31 - First armed incident between Croatia and rebel Serbs opposed to independence from Yugoslavia takes place in Titova Korenica near Plitvice. June 25 - Slovenia and Croatia proclaim formal independence from Yugoslav federation. June 27 - The Yugoslav federal army (JNA) starts withdrawing from Slovenia and Croatia, but fighting begins between Croats and local Serbs helped by JNA. Croatian Serbs announce self-styled republic of Serb Krajina. October 1 - JNA launches attack on the Adriatic port of Dubrovnik and soon begins shelling the ancient walled city and well-known tourist destination. The siege, which lacks any clear military rationale, draws international outrage and the JNA withdraws in 1992. November 18 - Serbs backed by JNA tanks and artillery capture the eastern town of Vukovar after brutal siege which levels the town in ex-Yugoslavia's most devastating battle. 1992 January 15 - A truce ends seven months of fighting between rebel Serbs and Croats, with Serbs holding roughly a third of the territory. U.N. peacekeeping troops deploy to police ceasefire. Aug 8 - Representatives of Croatia and the Federal Republic of Yugoslavia (FRY), now consisting only of Serbia and Montenegro, meet in Budapest to sign agreement on prisoner of war exchanges. Oct 20 - Yugoslavia and Croatia sign declaration in Geneva on opening of missions in Belgrade and Zagreb, restoration of roads, railways, telecommunication links, pensions. 1993 Sept 21 - Serbian president Slobodan Milosevic and Tudjman meet on British warship HMS Invincible in Adriatic Sea. Milosevic says agreement reached on almost all questions regarding Bosnia. 1994 Nov 4, Zagreb - Croatian Foreign Minister Mate Granic meets FRY counterpart Vladislav Jovanovic. Two rounds of talks fail due to disputes over the future status of the Serb region of Krajina. 1995 Jan 31 - Rebel Croatian Serbs reject an international peace plan giving them autonomy under Zagreb government rule. May 1 - Croatian army moves to recapture Serb-held Western Slavonia, one of three enclaves under Serb control. May 2 - Rebel Serbs retaliate by firing missiles on Zagreb city centre. Aug 4 - Croatian army launches "Operation Storm" to recapture Serb Krajina region which falls within hours. Some 200,000 Serbs flee their homes in the Krajina in the largest exodus of the Yugoslav conflict. Only Eastern Slavonia region remains in Serb hands. Nov 2 - U.S.-organised peace talks to end fighting in Bosnia begin in Dayton, Ohio. Nov 12 - Croatian Serbs end four-year revolt signing an accord to handover Eastern Slavonia to Croatia after a transitional period under U.N. authority. Milosevic and Tudjman agree accord on the fringes of the Dayton talks. Nov 21 - Presidents Alija Izetbegovic of Bosnia, Franjo Tudjman of Croatia and Slobodan Milosevic of Serbia sign Bosnia peace agreement in Dayton. Dec 21 - Zagreb-Belgrade telephone links restored - first to talk are Croatian foreign minister Mate Granic and Yugoslav counterpart Milan Milutinovic. 1996 June 24 - FRY, Croatia agree to open consular offices in their capitals. Aug 7 - Milosevic and Tudjman meet in Athens and announce plans to sign mutual recognition accord in two weeks. The two leaders, widely blamed for igniting the Yugoslav wars, have met a total of 48 times since 1991. 2113 !GCAT !GPOL Ukraine celebrates five years of independence from Kremlin rule on Saturday, describing civil and inter-ethnic peace as its main post-Soviet achievement. Ukraine's declaration of independence in 1991, backed nine-to-one by a referendum in December of that year, effectively dealt a death blow to the Soviet empire and ended more than three centuries of rule from Moscow. Ukraine, with a Russian community of 11 million people -- the world's largest outside Russia -- has avoided conflicts like those in Russia's Chechnya, neighbouring Moldova, and the former Soviet republics of Georgia, Azerbaijan and Tajikistan. "Ukraine's biggest achievements for five years are the preservation of civil peace and inter-ethnic harmony," President Leonid Kuchma said in televised statement this week. "Unlike many other post-Soviet countries we were able to deal with conflict situations in a peaceful and civilised way." But independence was initially accompanied by hyperinflation and economic collapse, although there are signs of a turnaround. Inflation -- a hyperinflationary 10,300 percent a year in 1993 -- was a respectable 0.1 percent a month in June and July and the economy has just begun to grow. "There is no doubt that economic growth has already started," said Adelbert Knobl, head of the International Monetary Fund's mission in Ukraine. "The national bank and the government have every reason to be proud of their efforts." Central bank officials said on Thursday that a much-postponed hryvna currency would "definitely" be introduced before the end of this year. It will replace the interim karbovanets currency, which was introduced at par to the Russian rouble in 1992 but now trades at almost 33 karbovanets per rouble. Ukraine has repeatedly promised to introduce the hryvna but had to postpone the plans because of economic problems. Proud of its record in promptly joining both the Council of Europe and NATO's Partnership for Peace, Ukraine has displayed a certain naivety in foreign policy, offending China this week by allowing a Taiwanese minister to appear on a very public, if unofficial visit. China cancelled a visit by a top-level delegation in protest. Kiev's Foreign Minister Hennady Udovenko said Beijing was overreacting. But Ukraine, seeing itself as a bridge between Russia and the rapidly westernising countries of eastern Europe, is looking west as well as east. Kuchma has said Kiev wants membership of the European Union, associate membership of the Western European Union defence grouping and to move closer to NATO. One message from the West came this week, when U.S. President Bill Clinton congratulated Ukraine on the anniversary, promising to support market reforms and praising Ukraine as a "stabilising factor" in a united Europe. 2114 !GCAT !GCRIM Slovak police said on Friday they were closely investigating contacts made in Slovakia by Marc Dutroux, chief suspect in the killing of two Belgian girls and the kidnapping of two others last year. "The Belgian representatives let us know that Marc Dutroux had visited Slovakia several times in the past," Rudolf Gajdos, head of the Slovak office of Interpol told Reuters. " (Interpol) and Slovak police are now looking into the contacts he made in the country when he was here," he said. An Marchal and Eefje Lambrecks went missing last August. Dutroux, 39, was charged last week with the abduction and illegal imprisonment of two other girls aged 14 and 12, and is one of several suspects in the Marchal and Lambrecks case. Last Saturday he led police to the bodies of two other girls, aged eight, who died of starvation earlier this year after their abduction in June, 1995. Speculation in Belgian media orignally focused on the possibility that they were sold into prostitution in the Czech Republic after being abducted by Dutroux. Belgian police said an officer had visited Bratislava to talk with Slovakian detectives about An and Eefje and other disappearances, and he planned to go also to Prague. The Czech office of Interpol said on Friday it would neither confirm nor deny that Dutroux had been in the Czech Republic, Slovakia's western neighbour and former federation partner. "We held talks with a representative of Belgian police, located in Vienna, this week, on the case of two missing Belgian girls," Dusan Ivan, a Slovak national police spokesman said. 2115 !GCAT !GDIP !GPOL !GVOTE The OSCE may postpone municipal elections in Bosnia in response to evidence that the voter registration process for refugees and displaced persons has been unfairly manipulated, an OSCE spokeswoman said on Friday. "That's one of the options being discussed," said Agota Kuperman, spokeswoman for the Organisation for Security and Cooperation in Europe (OSCE), which is supervising elections. Kuperman reported the OSCE's top rule-making body, the Provisional Election Commission (PEC) was meeting behind closed doors in Sarajevo on Friday to consider postponement, among "a number of other options". Bosnians are scheduled to go to the polls on September 14 to elect municipal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three- person collective Presidency. As many as 2.9 million Bosnians may vote on election day -- up to half of them refugees and displaced persons. The OSCE and independent monitors report hundreds of thousands of refugees living in Serbia and displaced people in Bosnia's Serb republic were actively discouraged from registering to vote in the community they lived in before the war. Officials say local authorities directed these individuals to register in target communities where the pre-war Moslem majority was expelled during the 43-month Bosnian conflict. According to OSCE officials the intent of this "electoral engineering" is to cement Serb control over strategic but depopulated towns by ensuring a Serb majority even if all expelled Moslems somehow show up to vote on election day. Bosnian Moslems complain that municipal elections under such conditions would merely ratify ethnic cleansing. The international community's High Representative in Bosnia, Carl Bildt, expressed "deep disquiet" over refugee registration figures recently released by OSCE and asked them for a plan of action to remedy the apparent injustice. Bildt told Reuters on Thursday that some of the voter registration numbers were "obviously rigged". "The figures are simply not credible as voluntary acts. They fly in the face of common sense," he added. The Moslem SDA party announced on Friday it was asking the OSCE to postpone the municipal elections and abolish all voting by "Form 2" -- the voter registration form which enabled people to register in a place other than their pre-war home. The SDA, one of three main parties in Bosnia, said its leadership would meet on Sunday and that if its demands were not met it would reconsider participating in elections and might call on other parties to do the same. OSCE spokeswoman Kuperman said there was division even within OSCE about the problem. She reported that the OSCE official in charge of registration for out-of-country voters insisted it had all been done in a "technically correct" way. "There are (Provisional Election Commission) members who feel that if the rules and regulations have been followed we are bound and we cannot make changes," Kuperman said. Kuperman added that the PEC could not make any final decision without the concurrence of the OSCE's mission chief for Bosnia, Robert Frowick, who was out of the country until Saturday. The mandate to hold elections on September 14 comes from the Dayton peace agreement, but there is no requirement that municipal elections be included as part of that process. "If the OSCE postpones the municipal elections I would not be surprised to see Bosnian Serbs boycott elections at the other levels," said a U.N. official who asked not to be named. "The Serbs are really mostly interested in the municipal elections anyway. They want to finish with elections what they started with the war and wrest final control of the Serb republic and its key municipalities from the Moslems." 2116 !GCAT !GVIO Poland's parliament appealed to world opinion and the Council of Europe on Friday to prevent the Russian government from continuing the war in Chechnya. The lower house dominated by the ruling ex-communists and a Peasant party approved the appeal, a watered-down version of a call signed by opposition politicians and several leading intellectuals, by acclamation with no dissenting voices. "We appeal to all people of good will -- with a common protest, let us restrain the government of the Russian Federation from using force and continuing the war in Chechnya," the appeal said. It said every day brought new sufferings and prolonged the tragedy of the Chechen nation. "The Sejm (lower house) of the Polish Republic, in such a situation, cannot remain merely a passive observer of the breaking of basic human rights on such a wide scale," the appeal said. Any attempt to solve the problem of the Chechen people through force directed against the entire nation was doomed to fail amid great suffering, it said, adding that the only hope of a peaceful end to the conflict was through negotiations. 2117 !GCAT !GPOL !GVOTE A former Estonian communist and leader of Estonia's drive for independence from the Soviet Union said on Friday he would challenge President Lennart Meri in a presidential election on Monday. Arch-rival Arnold Ruutel and Meri contested the last presidential election in 1992, one year after the small country quit the Soviet Union. Meri, 67, is now seeking a second term. Ruutel, 68, is currently deputy speaker of parliament. "Arnold Ruutel has agreed to run for the office of president," a spokesman for Ruutel's Country Peoples Party told Reuters after a party conference. In Estonia, parliament chooses the president and the two men face a first round of voting on Monday, with a second and possibly third round the following day. The winner needs the backing of 68 of the 101 members of parliament and will serve a five-year term. The charismatic Meri is favourite to win in the first round with the public support of almost 60 MPs. Ruutel so far only has the confirmed support of 22 members of parliament, including 20 from his own party. But victory for Meri is not guaranteed as some politicians believe he has abused his position by taking too much power. The main criticism against him is that he signed an agreement on the withdrawal of Russian troops in 1994 without consulting parliament. Critics say the deal left too many former Soviet military personnel in Estonia. Many Estonians regard the hundreds of thousands of Russian-speakers left in their country after independence as colonists and especially dislike former Soviet military staff. Meri is very popular amongst ordinary Estonians and many regard him as a good spokesman for their country. 2118 !GCAT !GPOL President Leonid Kuchma appointed a new head of Ukraine's investment promotion agency, the Ukrainian National Credit-Investment Company, on Friday, Unian news agency reported. Volodymyr Kuznetsov will also serve as Kuchma's chief adviser on investment matters. Kuznetsov was previously Kuchma's chief economic adviser. --Irene Marushko, Kiev Newsroom +380 44 229 2264 2119 !GCAT !GCRIM !M12 !MCAT Russian police are preparing an order to freeze up to a further $7 million nominal of MinFin bonds, banking sources said on Friday. A police official confirmed that an order to freeze MinFin bonds was being prepared, but was unable to give details. 2120 !GCAT !GPOL Russian Prime Minister Viktor Chernomyrdin said he would appoint former fuel and energy minister Yuri Shafranik as his adviser, Itar-TASS news agency quoted Chernomyrdin as saying on Friday. Shafranik was replaced on Thursday by Pyotr Rodionov, former head of RAO Gazprom's St Petersburg subsidiary. Shafranik will become Chernomyrdin's aide on energy issues, Itar-TASS said. --Julie Tolkacheva, Moscow Newsroom, +7095 941 8520 2121 !E51 !E512 !ECAT !GCAT !GDIP !GPOL Polish legislators on Friday overwhelmingly backed a bill ratifying Poland's entry to the Organisation of Economic Cooperation and Development (OECD). Speakers for all but one parliamentary caucus supported OECD membership during a ratification debate. A vote on the bill is scheduled next week, but Friday's debate showed the vote would likely be a mere formality. "Advantages stemming from our OECD membership are very significant...It should ensure broader inflow of foreign investment," Foreign Minister Dariusz Rosati said during the debate. The OECD membership ratification bill will need to clear the senate and be signed by President Aleksander Kwasniewski, but neither is expected to oppose it. Poland was accepted into the OECD, the Paris-based club of 27 wealthy nations, in July as the third former Soviet bloc country. It sees the membership as an important step on its way to the European Union. -- Warsaw Newsroom +48 22 653 9700 2122 !E41 !ECAT !GCAT !GJOB !GPOL Poland's Trilateral Commission, grouping representatives of the government, trade unions and employers, remains divided over pay rises for public sector staff, the labour ministry said on Friday. It said that late on Thursday the government side had turned down the Solidarity trade union's demand that wages for public sector workers such as teachers, doctors and police, be increased by 10 points above inflation in 1997. @ "Negotiations will continue on Monday but if the sides fail to reach an agreement by August 28, it will be up to the government to decide on the scope of wage increases," said labour ministry spokeswoman Wieslawa Majak. The government is offering the public sector workers a four-point rise above inflation, which should translate into an average monthly gross salary of 963 zlotys next year -- around the current level for this year in the enterprise sector. The government and Solidarity are also at odds over this year's wage increase in the public sector. @ The union demands an additional rise in October, saying this would allow the government to fulfil last year's promise to raise public sector wages by 5.5 percent in real terms. The government wants to compensate workers with a one-time payment of 97.8 zloty in February next year. -- Warsaw Newsroom +48 22 653 9700 2123 !GCAT !GVIO A bomb broke windows and knocked over holy scrolls at a new Moscow synagogue late on Thursday in what its rabbi said was a deliberate attack on Jews "This was clearly an anti-semitic act," Rabbi Berel Lazar, of the Marina Roshcha synagogue and a member of the U.S.-based Lubavitch Jewish organisation, said in a statement. The brick synagogue, which replaced an older wooden one burnt down by an arsonist in 1993, opened only in June. Russia's Federal Security Service (FSB) told Itar-Tass news agency that the device, containing about 300 grams (10 ounces) of explosive, did not appear to be linked to bombs placed on Moscow trains and buses in the past two months. The blast, against an outer wall, dislodged bricks and shattered windows in the two-storey building, sending glass showering over the spartan interior. The ark housing the sacred Torah scrolls was jolted, knocking the scrolls over. Vladimir Kuravsky, of the religious community's staff, told Reuters there was about $15,000 worth of damage. But the congregation would not be discouraged and would go ahead with plans for a larger building. Its wooden predecessor had served as a centre for Russian Judaism during the seven decades of communist repression. The Lubavich organisation is very active in Russia. The country, and Moscow in particular, has a sizable Jewish community despite recent emigration. But the lack of religious instruction in Soviet times means many Russian Jews have little knowledge of their faith. 2124 !GCAT !GVIO Rebel fighters and Russian soldiers said a ceasefire effective at noon (0800 GMT) on Friday was being generally observed, although scattered gunfire echoed through the Chechen capital Grozny. The Russian army said earlier it was preparing to withdraw from the rebel-dominated southern mountains of the region as part of the peace deal reached with separatists on Thursday. "There has been some shooting from their side but it has been relatively quiet," said fighter Aslan Shabazov, a bearded man wearing a white t-shirt and camoflage trousers. Soon after he spoke another burst of gunfire rocked the courtyard where the rebels had set up their base and a captured Russian T-72 tank roared out to investigate. The separatists, who swept into Grozny on August 6, still control large areas of the centre of town, and Russian soldiers are based at checkpoints on the approach roads. "The ceasefire is being observed," said woman soldier Svetlana Goncharova, 35, short dark hair poking out from under a peaked camouflage cap. A few helicopters flew overhead, firing off flares, but there was no shooting from the air. The truce, the latest of several, was agreed in talks on Thursday between Russian peacemaker Alexander Lebed and rebel chief-of-staff Aslan Maskhadov. The two also agreed to set up joint patrols in Grozny, but Goncharova said she was sceptical about whether this could work. "We have to try it, but I doubt if this is possible with the separatists," she said. 2125 !GCAT !GPOL !GVIO Rebel fighters and Russian soldiers said a ceasefire effective at noon (0800 GMT) on Friday was being generally observed, although scattered gunfire echoed through the Chechen capital Grozny. (Corrects to make clear ceasefire is being observed.) The Russian army said earlier it was preparing to withdraw from the rebel-dominated southern mountains of the region as part of the peace deal reached with separatists on Thursday. "There has been some shooting from their side but it has been relatively quiet," said fighter Aslan Shabazov, a bearded man wearing a white t-shirt and camoflage trousers. Soon after he spoke another burst of gunfire rocked the courtyard where the rebels had set up their base and a captured Russian T-72 tank roared out to investigate. The separatists, who swept into Grozny on August 6, still control large areas of the centre of town, and Russian soldiers are based at checkpoints on the approach roads. "The ceasefire is being observed," said woman soldier Svetlana Goncharova, 35, short dark hair poking out from under a peaked camouflage cap. A few helicopters flew overhead, firing off flares, but there was no shooting from the air. The truce, the latest of several, was agreed in talks on Thursday between Russian peacemaker Alexander Lebed and rebel chief-of-staff Aslan Maskhadov. The two also agreed to set up joint patrols in Grozny, but Goncharova said she was sceptical about whether this could work. "We have to try it, but I doubt if this is possible with the separatists," she said. 2126 !C24 !CCAT !GCAT !GWEA No closures of airports in the Commonwealth of Independent States are expected on August 24 and August 25, the Russian Weather Service said on Friday. --Moscow Newsroom +7095 941 8520 2127 !GCAT !GCRIM !GDIP A high-ranking team of U.S. law enforcement experts has arrived in Sarajevo to aid the Bosnian government's fight against organised crime and to help ensure security for next month's national elections. "We are concerned about organised crime in Bosnia, as are Bosnian officials, and especially about narcotics trafficking," the team leader, U.S. Assistant Secretary of State Robert Gelbard, told reporters on Friday. "Eastern Europe is being swamped by a tidal wave of drugs which originate with the opium and heroin trade from Afghanistan. The old Balkan route is opening up again with connections to Turkey, Italy, many countries." Gelbard met with officials from the country's Moslem-Croat federation and from its Serb republic during the week, emphasising the need for law enforcement cooperation both within Bosnia and between Bosnia and its European neighbours. Describing drugs and organised crime as "trans-national" problems, Gelbard said post-war Bosnia needs help in restoring its entire criminal justice system, from local police all the way through the ranks of the judiciary. "Bosnian officials admit that their pre-war organised crime-fighting capability has been lost," the envoy said. "They have to develop an institutional capability to combat crime and narcotics, they have to realise that these are threats against the security of their government." Warlords carved up much of Bosnia during 43-months of war, dealing stolen automobiles, guns, drugs, food, fuel and human beings across front lines for enormous profit. Even in peace some of those same individuals and their organisations remain active. The counterfeiting of money and identity documents is a growing problem in Bosnia as well. Gelbard said the United States is prepared to provide training and technical assistance to Bosnia. More funds could come from a law enforcement donor's conference for Bosnia scheduled to be held in Dublin on September 28. As for security for September 14 elections, the envoy said he was satisfied that NATO-led combat troops, U.N. and local police were developing "reasonable" plans to deal with potential violence on election day. Authorities are concerned about potentially significant movements of voters across de facto ethnic boundary lines as they attempt to cast ballots in towns from which they fled or were expelled during the 43-month Bosnian war. NATO troops and U.N. police flooded the tense Bosnian city of Mostar during recent municipal elections there and prevented violence. Gelbard said the same approach might be used to calm likely flashpoints in the national elections. The Organisation for Cooperation and Security in Europe, which is supervising elections, has also considered erecting polling stations on either side of tense ethnic boundary lines so people could vote in the place where they are registered without crossing. 2128 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Romanian workers in the petrochemical industry have cancelled plans for an indefinite strike after wrestling concessions from their employers, a trade union leader said on Friday. "We decided to give up the strike. Our main demands have been met," trade union leader Constantin Sirbu said from the oilfield of Ploiesti, north of Bucharest. Last month the unions threatened to launch an all-out stoppage from Friday to protest against the authorities' failure to reform the sector and to ensure sufficient crude oil supplies to refineries. "Refineries work now at around 50 percent capacity, compared with 20 percent last month. Things have improved and we were also promised job security," Sirbu said. A union demand for an increase of 50,000 lei in the average monthly wage of 440,000 lei had also been met, he said. An acute shortage of hard currency as well as unforseen imports of crude and fuel oil made to cope with Romania's unusually large energy demand last winter forced the country to halve its crude oil imports over January-July. The government responded by creating a special hard currency fund for crude imports that forces some 100 state-run companies to exchange part of their hard currency earnings at the central bank's disadvantageous exchange rate. Last week, the country's main oil trader Petrolexportimport said it had paid its outstanding bills and that it would import some 5.0 million tonnes of crude by the end of 1996. A new National Oil Company holding group that has brought the country's sprawling oil industry under the one umbrella, expected to better channel funds in the oil sector and help finance crude imports, also became operational this month. "According to our estimates, refineries will work at some 75 percent capacity which means processing around 18 million tonnes of crude a year," Sirbu said. Romania has a bloated refining capacity of some 35 million tonnes a year (equivalent to around 700,000 barrels per day), inherited from the communist era. A government programme aims to trim capacity to some 20 million tonnes (about 400,000 bpd) over the next five years. -- Bucharest Newsroom +40 1 3120264 2129 !GCAT !GPOL !GPRO A Russian newspaper, in the latest of a series of reports about President Boris Yeltsin's health, said the president would soon receive treatment at a special Moscow clinic, but Yeltsin's office denied the report. The daily Nezavisimaya Gazeta, quoting a source in the Kuntsevo medical centre on the outskirts of Moscow, said two wards equipped with the most sophisticated medical equipment had been set up ready for the president. "I can deny this information," Yeltsin's press office said. Yeltsin has appeared in public only occasionally since he won a second term in office on July 3, prompting rumours that he was ill. The Kremlin has denied all rumours and Yeltsin gave a televised interview lasting several minutes on Thursday. Yeltsin, 65, had two mild heart attacks last year. Aides say he is suffering from "collossal weariness" after a hectic election campaign. 2130 !GCAT Lithuanian newspapers carried the following reports in their Friday editions. Reuters has not verified these stories and does not vouch for their accuracy: LIETUVOS RYTAS - Lithuanian lawmakers decided to restructure the State Commercial Bank and issue 90 million litas worth of government T-bills to support the bank's liquidity. - Parliament approved the regulations of the Property Bank, which will deal with the bad loan portfolios of banks whose assets exceed 400 million litas. - During stock market trade on Thursday, shares in Vilnius Bank hit a new record of 920 litas. RESPUBLIKA - The vote for the foundation of oil company Lietuvos Nafta by merging four oil sector enterprises was delayed because of procedural wranglings on Thursday. The fate of the law should be decided at the next parliament session on September 10. - During a visit to a Vilnius hospital, Brazauskas was shown a Lithuanian soldier whose jaw was broken after he was beaten by a superior officer. - The ruling Lithuanian Democratic Labour Party (LDLP) has lost 10 members and now has 62 members in its faction. - Among 5,000 Lithuanians who went to fight in Afghanistan, 88 were killed and 97 returned home invalids. According to questionnaires filled in by some war veterans, it is thought that 75 percent of them will become invalids in the future. - Ecstasy tablets were distributed in the Vilnius NASA disco club. The price of one tablet is 30-40 litas. LIETUVOS AIDAS - Lithuania commemorates a Black Ribbon day today: the 57th anniversary of the Molotov-Ribbentrop Pact, which changed the fate the fate of Lithuania and the other Baltic states for 50 years. - By the votes of the ruling LDLP, parliament allowed state-owned news agency ELTA to buy the 4,000 square metres building where it is based in the centre of Vilnius for 200,000 litas. VERSLO ZINIOS - Energy officials expect the national oil firm Lietuvos Nafta will atract funds to the Butinge oil terminal, Mazheikiu Nafta refinery and the Lietuvos Kuras chain of retail service stations. - It is not clear whether the government will authorise the rescue of problem-struck Vakaru Bank, especially as World Bank experts think it should be made bankrupt. - The State Commercial Bank will be restructured and will get a 90 million litas loan after the sale of a new issue of governmental T-bills. -- Riga Newsroom +371 7 22 66 93 2131 !GCAT The following are the reports carried by Estonia's newspapers on Friday. Reuters has not verified these reports and does not vouch for their accuracy: ALL NEWSPAPERS - Both the Estonian and Latvian parliaments ratified a bilateral sea border agreement. - Mare Korkjas won a gold medal in swimming and Anneli Ojastu a silver medal in long-jump at the Atlanta Para-Olympics. - President Lennart Meri faced renewed allegations of KGB links during the Soviet era. Five members of parliament issued a statement asking Meri to answer questions about contradictory data in his biography, his deportation to Siberia, trips abroad, jobs in the 1950s and reports to VEKSA, which worked with the KGB. POSTIMEES - The heads of nine parliamentary parties were asked to rate Meri's chances of re-election in the first round between zero and 10. The results showed an average rating of 4.2 out of 10. - Meri was registered officialy on August 22 as a presidential candidate. SONUMILEHT - Meri was issued his Estonian passport yesterday. EESTI PAEVALEHT - Foreign Minister Siim Kallas and head of the Reform Party says there is no chance he will stand for president. ARIPAEV - Tallin Pharmaceutical Producers is negotiating over opening a branch in Russia. -- Riga Newsroom +371 7 22 66 93 2132 !GCAT !GDIP Yugoslavia and Croatia were poised on Friday to sign a landmark normalisation treaty ending five years of tensions and paving way for stabilisation in the Balkans. Croatian Foreign Minister Mate Granic landed at Belgrade airport aboard a Croatian government jet on Friday morning for talks with his Yugoslav counterparts and a signing ceremony expected around noon (1000 GMT). On Thursday the Yugoslav government endorsed the text of the agreement on normalising relations between the two countries, the Yugoslav news agency Tanjug said. "The government assessed the agreement as a crucial step to resolving the Yugoslav crisis, ensuring the restoration of peace in former Yugoslavia," it said. Last-minute talks this week on the legal fine print finally cleared the way for a treaty based on mutual recognition within internationally recognised borders and the establishment of diplomatic relations, diplomats said. The pact ends five years of hostility after Croatia's secession from federal Yugoslavia. Western powers regard diplomatic normalisation between Croatia and Serbia, twin pillars of the old multinational federal Yugoslavia, as a crucial step towards a lasting peace in the Balkans. 2133 !GCAT These are the leading stories in the Sarajevo press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. OSLOBODJENJE - Saudi Arabia donates $20 million for housing reconstruction in Bosnia. - France donates 11 million FF towards navigation equipment for battered Sarajevo airport, recently opened for commercial flights. DNEVNI AVAZ - Training of Moslem-Croat federation army by American experts to begin Aug 26, Bosnian army general Rasim Delic says. - The Hague war crimes tribunal opens an office in Sarajevo and another in Belgrade, deputy prosecutor Graham Blewitt says. - Bosnian army officer Mirsad Catic, recently arrested by Croatian authorities for alleged involvement in Yugoslav Army attacks on Zadar in 1991, denies he was involved in shelling the town, Catic's attorney Ivan Rudic says. VECERNJE NOVINE - Fuel prices will remain the same for the time being, Bosnia's federal government says. - More than 2,300 Bosnian refugees returned to the country in the last month from Turkey, Macedonia, Denmark, Norway, Jordan and Czech republik. --Sarajevo newsroom, +387-71-663-864. 2134 !GCAT The following are the main stories from Friday morning's Albanian newspapers. Reuters has not verified these stories and does not vouch for their accuracy. KOHA JONE - The government may have to cut public sector jobs because the European Union did not grant $25 million in financial assistance for balance of payments. The move has not been confirmed by any official institution. - Based on their monitoring work at the last general elections, the U.S. International Republican Institute is making suggestions to Albanian political parties on ways to improve the electoral process ahead of the upcoming local poll. - A boycott of the local elections this fall could lead to early general elections, a newspaper commentary says. GAZETA SHQIPTARE - A national folk music competition is to be held in the southern town of Saranda in September. - The reconstruction of Tirana's electrical power supply system will take until 1998. RILINDJA DEMOKRATIKE - The European Union is to assist Albania's economic programme from 1996-1999 with aid of 140 million ECUs. 2135 !GCAT Here are highlights of stories in Romania's press on Friday. Reuters has not verified these stories and does not vouch for their accuracy: Business: ROMANIA LIBERA - At present investment funds cannot operate in market because there is no market. They could work on exchange but stocks there are unattractive, newspaper quotes Ioana Vlas, president of national union of investment funds. ADEVARUL - Tarom plans to sell its Airbus planes and to purchase eight Boeing 737s. - Finance Minister senior official said on Thursday government was planning to freeze prices of number of products including foodstuffs and petrol, as well as of energy and rents till 1997. - Newly created National Oil Company with its current structure and tasks seems to express government tendency to monopolise oil sector. - State Ownership Fund (FPS) managed to privatise 2,311 state companies so far, Emil Dima, president of FPS's administration board says in interview. TINERETUL LIBER - Number of licensed securities companies in Romania has reached 89. AZI - Banc Post plans to raise its capital by 2.2 billion lei this year, when it forecasts gross profit of 31 billion lei. CURIERUL NATIONAL - Banca Romana petru Dezvoltare is first Romanian bank to go private in next few months. Bank vice-president Ioan Niculescu says in interview bank has consolidated its position owing to performing credits for investment in private sector. - Romania expects post-privatisation fund to become operational in early October, Iacob Zelenco, president of National Privatisation Agency said. CRONICA ROMANA - Court of Accounts says in statement control of National Bank showed irregularities in using profit. General: ROMANIA LIBERA - Foreign Minister Teodor Melescanu, president of national committee to support President Ion Iliescu's candidacy for a new presidential term in November 3 polls, breaks diplomatic status which says "diplomats cannot be party or political organisation members and cannot implicate themselves in parties' or political organisations' activities". - "I have nuanced some ideas" says Romanian journalist on interview with Emil Constantinescu, presidential candidate of main opposition Democratic Convention (CDR) bloc in the U.S. last month. The interview caused a scandal as Constantinescu allegedly said he would bring exiled King Michael back to the country after being elected president in the November 3 polls. - Statement from ex-king Michael says he keeps his impartialty over whole political life in Romania and stresses that Romania's main responsibility now is to hold free and democratic elections to insure a stable government afterwards. - Disinformation seems to be policy to be used by ruling Party of Social Democracy (PDSR) in electoral campaign, said Mircea Ionescu Quintus, head of National Liberal Party (PNL), second largest in the opposition CDR bloc. - Newspaper publishes a four-page report on August 23, 1944, when Romania switched sides from Nazi germany to join the Allied forces in World War Two. ADEVARUL - Former reformist Prime Minister Petre Roman, candidate for presidency of Social Democratic Union (USD) said he would not collaborate with parties willing to change the constitution. - Agriculture Minister Valeriu Tabara is campaign manager of Gheorghe Funar, presidential candidate of National Unity Party (PUNR) and Justice Minsiter Iosif Gavril Chiuzbaian is spokesman of PUNR's campaign staff for parliamentary elections. - Three of the four casinos on the Black Sea coast were shut down for grave financial irregularities. EVENIMENTUL ZILEI - Diversion with "pro-monarchist statement of CDR leader Emil Constantinescu" came to an end after the author of the interview with Constantinescu admitted he had changed some ideeas, says the newspaper warning the population to learn from the case on how a diversion can be organised. CRONICA ROMANA - An apartment in a concrete block in Bucharest, 5.5 hectares of farming land, a 10-year old Fiat and a new Cielo car, 200 square metres in a mountain resort are Prime Minister Nicolae Vacaroiou's assets, which he declared to "avoid any possible denigration". - Treaty with Hungary is a starting point which can help to advance in a longer and more complex process regarding the historic reconciliation between the two countries, says Defence Minister Gheorghe Tinca in interview. - Upper house of Senate to resume sessions after summer holidays on September 2. CURIERUL NATIONAL - People with full blowen AIDS are discriminated, while Romania's legal system grants protection, says the newspaper. ($=3,157 lei) -- Bucharest Newsroom 40-1 3120264 2136 !GCAT These are the leading stories in the Skopje press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. DNEVNIK - The announced changes in the local election law have not changed political parties' opinions. The opposition considers them "cosmetic", while the ruling coalition is sure they will provide a fair and democratic ballot. - Foot-and-mouth cattle disease has grown into a hodge-podge of expertise, science and politics, while Macedonia is asking the EU for lab materiaL to help curb and control the epidemic. NOVA MAKEDONIJA - World Bank is funding 35-million-dollars worth of projects for Elektrostopanstvo, the state-owned electricity production and distribution company. VECER - "Certain conditions for our participation in the local elections have been met, but three are still in the pipeline and we will reach our final decision whether to take part after they are resolved," says ethnic Albanian Party for Democratic Prosperity leader and ruling coalition member Abdurahman Aliti. - The government-proposed changes to the Local Election Law will enable the holding of local elections this fall. - Slobodan Casule, Skopje newsroom 389 91 +201196 2137 !GCAT These are the leading stories in the Belgrade press on Friday. Reuters has not verified them and does not vouch for their accuracy. NASA BORBA - Yugoslavia and Croatia to recognise each other on Friday. - Federal Republic of Yugoslavia accepted all IMF terms, says Mihajlo Nikolic, advisor to ex-Natbank governor Dragoslav Avramovic. - Kragujevac weapons factory employees enter fourth day of strike. - July inflation of 6.6% calls for lower taxes and greater exports or external borrowing. - Bosnian Serb Army general staff criticises IFOR for simultaneously disarming Bosnian Serbs and arming the other side, instead of acting as a peace force. - Hague Tribunal for War Crimes in the former Yugoslavia opens office in Belgrade Friday. - Bosnian Serb president and vice-president will be elected by majority vote, says Bosnian Serb member of Temporary Election Committee Slobodan Kovac. - School-year will not begin on September 2 if the Government does not pay the teachers overdue salaries, says Independent Teachers' Trade Union. - Serbia and Montenegro, which are in a defacto confederate relation, should have separate armies, as they already have their own police forces, says Col. Ljubodrag Stojanovic, recently dismissed head of the Yugoslav Army Chief-Of-Staff Information Department. POLITIKA - Yugoslavia holds no more Croatians in jail, Croatia to account for 2,278 Serbs by September 30, says government committee for humanitarian issues. Yugoslav and Croatian committees to meet in Belgrade on September 13. - Elections in Eastern Slavonia, Baranja and western Srem are not feasible before mid-1997, says the region's president Goran Hadzic. VECERNJE NOVOSTI - Belgrade bus company "Lasta" and Zagreb's "Pan-turist" to launch daily traffic from Belgrade to Zagreb and Belgrade to Osijek on September 15 at the latest, says Lasta inter-city manager Zoran Leontijevic. - Illegal cigarette trafficking costs the state at least 1.5 billion dinars. - Belgrade newsroom, 381 11 +224305 2138 !GCAT Following are the main stories in Croatian newspapers on Friday. VJESNIK - Foreign Minister Mate Granic travels to Belgrade to sign the agreement on normalisation of relations with Yugoslavia, and Croatia can be satisfied with what has been achieved in last-minute talks. - Croatian kuna, Bosnian dinar and German mark gain equal status as currencies in Bosnia's Moslem-Croat Federation. - National oil company INA starts exploitation of the vital Djeletovci oilfield in the last Serb-held enclave of Eastern Slavonia. - War damage is estimated at 150 billion kuna, and Croatia has so far invested 3 billion in reconstruction which will take at least 10 more years, says Jure Radic, Minister of Development and Reconstruction. VECERNJI LIST - Salaries of the employed in the drugs firm Pliva, trading on the London Stock Exchange, will rise by nine percent by the end of the month. SLOBODNA DALMACIJA - Plane crash near Dubrovnik which killed U.S. Commerce Secretary Ron Brown in April was caused by bad flight planning and organisation, and a mistake made by the pilot, concludes joint American-Croatian investigation. -- Zagreb Newsroom, 385-1-4557075 2139 !GCAT These are the main stories in the Latvian newspapers on Friday. Prepared for Reuters by the Co-operation Fund. Reuters has not verified these reports and does not vouch for their accuracy: ALL NEWSPAPERS - Parliament ratified the treaty on the maritime border between Latvia and Estonia. - Parliament approved a declaration on the occcupation of Latvia, which calls on the international community to recognise the fact of Latvia's occupation by the Soviet Union in 1940. Ten deputies, representing the Socialist Party and the People's Harmony Party, voted against the bill. - Parliament approved a draft bill which will formally legalise abortions. The bill is strongly opposed by the Christian Democrat faction and the Catholic Church. DIENA - The Latvian Farmer's Union and the Union of Christian Democrats give partial support to the plan of Prime Minister Andris Shkele to abolish district governments. The two parties believe that the heads of the districts should be chosen by local residents. - After receiving an anonymous letter of threats to those investigating the activities of the OMON, a Moscow-backed paramilitary unit which fought against restoring Latvia's independence in 1990-1991, the interior ministry decided to start criminal proceedings. - The mayor of the city of Ventspils, Aivars Lembergs, who holds posts in several business companies, refuses to abide by the anti-corruption law, which says he should give them up. NEATKARIGA RITA AVIZE - 40 workers from the Riga mirror works went on strike to protest against delays in payment of salaries. BIZNESS & BALTIYA - Economy Minister Guntar Krasts met with officials from the Russian embassy in Latvia to discuss co-operation between the two countries. - President of the Latvian Gas company, Adrian Davis, said in an interview that the appointment of Piotr Rodionov to the post of energy minister in Russia will help the privatisation of Latvian Gas. DIENAS BIZNESS - Foreign companies will be offered up to 35 percent of shares from the Latvenergo new share issue. - The brewery Varpa starts producing Czech-brand Brauner beer. - The Bank of Latvia starts hard currency clearing. - Losses of the Latvian Shipping company reached $51.4 million. -- Riga Newsroom +371 7 22 66 93 2140 !GCAT !GPOL !GPRO President Boris Yeltsin, "lively" after a two-day break, has not yet fixed the dates for a longer vacation or decided where to go, Izvestia newspaper on Friday quoted spokesman Sergei Yastrzhembsky as saying. "Boris Yeltsin is very lively and dynamic," Yastrzhembsky told the paper. "Everyone who participated in the recording of an interview on Thursday...is convinced of that." Yeltsin visited the lakelands of northwestern Russia on Tuesday and Wednesday, but Yastrzhembsky said the president had not yet decided whether to take a longer vacation there. Komsomolskaya Pravda newspaper, in a special report from the lakeland region, said Yeltsin had gone fishing and boating and had played billiards during his two-day visit. Thursday's interview was the first time the president had appeared on television since he was inaugurated for a second term in office on August 9. He looked tanned after his break and spoke for several minutes, apparently without an autocue. Yeltsin criticised the work of his special representative in breakaway Chechnya and dismissed rumours that he would take his holiday in Switzerland. "Rumours circulate about my (possible) trip to Switzerland," Yeltsin said. "Thanks to the press for the invitation but I cannot go as there are problems which should be solved here. If I take my leave I will spend it on Russian territory." Yeltsin, 65, had two heart attacks last year and his disappearance at the end of a vigorous re-election campaign prompted speculation that he was ill again. Yeltsin's aides have denied the reports, although they say the president needs a rest after the campaign. 2141 !GCAT !GVIO The Russian army in Chechnya said it was preparing on Friday to withdraw from the rebel-dominated southern mountains of the region as part of a peace deal reached with the separatists a day earlier. Interfax news agency quoted a source at the military command near the capital Grozny as saying: "Preparations are going on now for the withdrawal of units from southern districts of the republic to the Chechen plain." Alexander Lebed, President Boris Yeltsin's envoy to Chechnya, signed the deal with the separatist command on Thursday after overriding orders by Russian generals in the region for the bombing of the rebel-held capital. Interfax said Russian forces were obliged under the agreement to leave a number of southwestern districts by Monday and quit the southern Shatoi district by Thursday, August 29. "Meeting these deadlines is very hard, so we made a start on withdrawing troops without delay," the military official said. Interfax and Itar-Tass quoted army officials as saying preparations were also under way to form joint monitoring units with the guerrilla forces in Grozny to police the city and oversee the moving apart of the warring sides. Tass said the units would drawn half from the Russian forces and half from the separatists. The joint command post would be set up at the village of Starye Atagi, about 20 km (12 miles) south of Grozny and close to Novye Atagi, where Lebed signed the truce with rebel chief-of-staff Aslan Maskhadov. A new ceasefire is due to go into effect across the region at midday (0800 GMT). Interfax quoted the army command as saying there was virtually no fighting in Grozny on Friday morning. Army positions had been fired on 19 times overnight in the region, including 13 times in the capital. An interior ministry spokesman told Tass one of its servicemen had been shot dead in Grozny overnight and an unknown number were wounded. 2142 !GCAT !GPOL !GVIO Alexander Lebed, Boris Yeltsin's envoy to Chechnya, said he planned to meet the president at 12.30 (0830 GMT) on Friday, half an hour after a new ceasefire he arranged with separatist rebels is due to begin. Lebed, quoted by Russian news agencies on his return from Chechnya, sounded a defiant note when asked if he might face opposition to his plan in the Kremlin. He said he would even use his powers to sack senior officials who stood in his way. "I'm in command here. I have legitimate authority to fulfil the duties I have been charged with," Interfax news agency quoted him as saying. Yeltsin's press office could not confirm the meeting with Lebed. Nor did a spokesman have any comment on the ceasefire deal. Lebed said Yeltsin's decree giving him powers to settle the 20-month conflict gave him the right to fire officials up to the rank of deputy minister. "I intend to make use of this right if I encounter any opposition," Interfax quoted him as saying. Lebed insisted that Yeltsin, who criticised him publicly on Thursday, had given him full powers to settle the crisis -- including to make a deal on the political future of the region. Lebed has promised to complete this at the weekend. It would be a "political document" dealing with Russia's bilateral relations with Chechnya, Itar-Tass news agency quoted him as saying. Lebed insisted he had fulfilled his duty in stopping the war, which flared up this month when the rebels seized much of the Chechen capital Grozny on August 6. Moscow has so far refused to countenance rebel demands for full independence. There was no further indication of what political terms Lebed might be preparing to offer the Chechens. Asked about the president's criticism that Lebed was going too slowly on ending the war, the tough-talking former paratroop general repeated an allegation made earlier this week that some recent Kremlin orders appeared not to have come from Yeltsin himself. There was no doubt about Thursday's rebuke -- Yeltsin made it on television in an interview apparently designed to quash rumours he was ill. But Lebed suggested some written orders were signed with only a facsimile of the president's signature. "The president and I haven't seen each other, but there's work to be done and so we're all working together," he said. Lebed was asked if he was sure he could make the Russian military observe the ceasefire and troop withdrawals outlined in the deal he signed with rebel commander Aslan Maskhadov on Thursday. "All the military leaders I assembled after signing the document took it as an unequivocal order," he said. He said he was still investigating how the Russian military command in Chechnya had issued an ultimatum to destroy Grozny this week -- a move Lebed said was aimed at thwarting his efforts to make peace. Continued skirmishing in the region was also an attempt to wreck the negotiations, he said, forecasting that they would continue, although not on any great scale. 2143 !GCAT Here are highlights of stories reported by Hungary's press, based on information by Nepszabadsag's Hungary Around the Clock service. For further details on how to subscribe to Hungary Around the Clock, please contact Monica Kovacs at (361) 351 2440 or fax your request to (361) 351 7141. ALL PAPERS - The price of energy and the cost of higher education will remain constant at least until the end of the year, the government announced Thursday. @ - The opposition Christian Democratic People's Party began collecting signatures Thursday in a bid to force Parliament to hold a special session to debate the Hungarian-Romanian basic treaty. - The Alliance of Free Democrats is calling for a minimum HUF 10 billion more for the purpose of raising the family allowance next year. - The foreign-owned Danubius Hotels Rt appears set to buy the hotel chain Hungaria Szalloda for HUF 8.1 billion, now that the State Privatisation and Holding Co announced Thursday that it approved the bid for the 14-member chain. @ - The Budapest Stock Exchange on Thursday suspended trading of Danubius shares on grounds that preliminary news reports indicating that Danubidus' bid for the Hungarian Szalloda hotel chain had met with success were impossible to substantiate and could thus have unduly influenced investors. - July saw a HUF 2.6 billion increase in household hard currency savings, indicating a slight reversal of the trend seen over the first seven months of the year. @ - Monsignor Piero Marini, a representative of Pope John Paul II said Thursday that no disease can mar the September visit by the Pope to Hungary as he is in a good state of health. NAPSZABADSAG - Bela Marko, president of the Democratic Federation of Hungarians in Romania said that the Hungarian cabinet had indicated a desire to discuss the draft of the basic treaty with Romania with his group next week. MAGYAR HIRLAP @ - The president of the Trade Union of Higher Education Employees announced Thursday that there will be no further dismissals in the higher education sector this year. - Citizens of the former Soviet Union have "rediscovered" Hungary, observes this paper, noting that last year's one million legal visitors has restored the number seen five years ago. - The Scandinavian airline SAS will increase the weekly number of its Budapest routes from eight to ten as of September 3. - The Economic Competition Agency imposed a HUF 3 million @ fine Thursday on the cosmetics retail chain Azur over two advertisements it says misled consumers. - A Finnish consortium comprising two companies, Ivo and Tomen, has been awarded majority ownership of Budapest Eromu (Power Plant), the State Privatisation and Holding Co. announced. NAPI GAZDASAG - ABN-AMRO Bank Magyarorszag Rt, subsidiary of Holland's ABN-AMRO Bank NV, saw a $400 million gross profit in the first half and boosted its balance sheet footing by nearly HUF 6 billion, to HUF 35.5 billion. @ - Administrative State Secretary Elemer Kiss said the cabinet wants to sell Magyar Hitel Bank to a strategic investor who will purchase 90 per cent of the shares and guarantee to raise its primary capital. -- Budapest newsroom (36-1) 266 2410 2144 !GCAT !GDIS One person died and at least 10 were injured on Thursday when a tanker carrying chemicals exploded near this small village on the main highway to the central city of Puebla 50 miles (80 km) from Mexico City, witnesses and officials said. Firemen and army and Red Cross rescue units rushed to the area to evacuate the injured and extinguish the burning truck, which was carrying at least 8,000 gallons (30,000 litres) of liquid propylene when it exploded . The driver of the truck was burned to death, Puebla state Civil Protection chief Guillermo Melgarejo told reporters. "There are 10 people in hospital with burns, of whom a young boy is in the most serious condition," he said. The blast appeared to have been caused when one of two tanks of propylene being hauled by the truck came loose, causing the driver to lose control of his vehicle and crash as he passed near the village. 2145 !GCAT !GVIO Leftist guerrillas operating across Colombia are simply "gangsters," but they pose the single biggest threat to the country's democratic stability, Army chief Gen. Harold Bedoya said. "We've referred to them successively as subversives, guerrillas and insurgents, but in reality they're nothing but gangsters," Bedoya said in a speech late on Wednesday. "Let us not be fooled. In Colombia a group of mafiosos disguised as a political insurgency wants to pull off the robbery of the century -- the illegal appropriation of an entire government through violent blackmail and illict enrichment," he said. His remarks came on the same day that leftist guerrillas killed four Colombian marines patrolling a river in the drug-infested southeastern province of Guaviare, authorities said on Thursday. Military spokesmen said Revolutionary Armed Forces of Colombia (FARC) rebels early on Wednesday attacked a high-speed patrol boat with automatic weapons and dynamite. Three marines were wounded in addition to the four killed. Guaviare, a FARC stronghold, is one of Colombia's leading cocaine production centres. The FARC, the country's largest and oldest rebel group, specialises in protecting rural drug farms and laboratories. In his speech, Bedoya also made an appeal for foreign military aid to fight the so-called "narco-guerrillas". "Colombia's narco-guerrillas are now the worst threat to our democracy and its institutions," he said. "We want our friends to recognise that, to understand it and to collaborate in the vast fight we're engaged in." Many countries, including the United States, maintain curbs on aid to Colombia's military because of its poor human rights record. The Colombian army chief made his remarks at a ceremony in the capital marking the launch of a book written by one of his staffers entitled "The FARC Cartel" that details what Bedoya describes as the FARC's now-dominant role in the drug trade. Western diplomats say there is no solid intelligence to prove the FARC has become a dominant player in global drug markets like the billionaire leaders of the Cali cartel. 2146 !E51 !E512 !ECAT !GCAT !GDIP Chileans want Japan to invest more heavily in their country and can offer easy access to the vast Brazilian market as an inducement, President Eduardo Frei told Japan's Premier Ryutaro Hashimoto on Friday. Frei and Hashimoto met on the second day of the Japanese leader's official visit to Chile, part of a Latin American tour aimed at raising Japan's profile in a region it once wrote off as a land of turmoil and disasters. Officials of both countries said Japan was now looking to Latin America as the only place where economic growth rates could match those of southern Asia. "Latin America is really changing, and therefore we hope the prime minister's visit will act as a catalyst to arouse Japanese investors' interest," said Hiroshi Hashimoto, the premier's spokesman. Nowhere was the change more evident than in prosperous Chile, he told reporters. He said Frei made it clear to Hashimoto that Chile expected Japan -- Chile's second largest trading partner -- to start putting real money into the South American country where it is now only a minor investor. "During the meeting, President Frei said he expects there to be a real increase in direct Japanese investments in Chile," said Japanese president's spokesman. Frei mentioned Chile's recent free trade agreement with the Mercosur bloc, which includes Brazil, as one of Chile's benefits, he said. The agreement will phase out tariffs between Chile and Mercosur, which also includes Argentina, Uruguay and Paraguay, over 15 years. He signalled that Hashimoto liked the idea. "Japanese businessmen may see more advantages to investing in Chile, and from Chile exporting to Brazil, than investing directly in Brazil," said the spokesman. The Japanese have about $500 million invested in Chile -- making them a distant seventh among investors by country. Hashimoto's visit to Chile was dominated by hard-headed economics, with none of the multi-million dollar loans and aid packages his entourge signed in Mexico. His only donation in Chile was $480,000 for a cultural institute. The premier was due to fly to Brazil early on Saturday and will later visit Peru and Costa Rica. 2147 !GCAT !GDIS !GENV !GWEA Hurricane Dolly crashed into Mexico's Veracruz state on Friday, killing at least two people and leaving a trail of destruction before being downgraded to a tropical storm, authorities and news reports said. Dolly, the fourth big weather system of the Atlantic season, ploughed into the northern tip of the largely agricultural Veracruz, ripping down telephone wires and electric poles, smashing windows and uprooting trees. One woman died when she was hit by a high tension cable that crashed to the ground as Dolly came ashore around 11 a.m. EDT (1500 GMT), close to the port of Tampico in the Gulf of Mexico, media reports said. The National television network Televisa said heavy rains brought on by Dolly in the northern state of Nuevo Leon, killed a man when he was swept away by strong currents in the Topo Chico River in the industrial city of Monterrey. Later on Friday, Dolly was downgraded to a tropical depression as it moved over Mexico while Tropical Storm Edouard, still hundreds of miles from land, gained hurricane strength, the National Hurricane Center said. At 5 p.m. EDT (2100 GMT), the center of former hurricane Dolly was located at latitude 21.8 north, longitude 99.7 west, about 90 miles (145 km) east-southeast of San Luis Potosi, Mexico, and was moving west at 16 mph (26 kph). Maximum sustained winds dropped to 35 mph (56 kph). Forecasters said they expected Dolly to break up in the mountains but warned residents to be alert for torrential rains and life-threatening flash floods. The storm could dump six to 12 inches (15-30 cm) of rain on parts of Mexico. Hurricane Edouard strengthened as it moved through the Atlantic Ocean but was far from land and a threat only to shipping. At 5 p.m. EDT (2100 GMT), the center of Edouard was located at latitude 13.9 north, longitude 40.7 west, about 1,385 miles (2,200 km) east of the Lesser Antilles and moving west at 15 mph (24 kph). Maximum sustained winds had climbed to 75 mph (120 kph), making it a Category one hurricane, and further strengthening was expected, forecasters said. Hurricane-force winds extended 35 miles (56 km) from the center and tropical storm-force winds extended 175 miles (280 km) from the center. Radio network Radio Red reported 2,300 people were evacuated from the low lying regions around Tampico because of Hurricane Dolly and rivers were rapidly rising in the region from the torrential rains dumped over a wide area of southern and eastern Mexico. Ruben Diaz Garza, director of the local newspaper El Sol de Tampico, told Reuters Dolly had made around 1,500 people homeless and that the entire port of some 500,000 was without electricity and drinking water. Dolly raced across the Caribbean this week to slam into Mexico's Quintana Roo state on Tuesday. It burst into the Gulf of Mexico on Wednesday after crossing the Yucatan Peninsula on Wednesday, home to hundreds of Maya ruins. 2148 !GCAT !GDIS !GENV !GWEA Hurricane Dolly crashed into Mexico's Veracruz state on Friday, killing at least two people and leaving a trail of destruction in its wake, authorities and news reports said. Dolly, the fourth big weather system of the Atlantic season, ploughed into the northern tip of the largely agricultural Veracruz, ripping down telephone wires and electric poles, smashing windows and uprooting trees. One woman died when she was hit by a high tension cable that crashed to the ground as Dolly came ashore around 11 a.m. EDT (1500 GMT), close to the port of Tampico in the Gulf of Mexico, media reports said. National television network Televisa said heavy rains brought on by Dolly in the northern state of Nuevo Leon, killed a man when he was swept away by strong currents in the Topo Chico River in the industrial city of Monterrey. Hurricane Dolly weakened rapidly as it moved over land in Mexico on Friday and was downgraded to a tropical storm with maximum winds of 55 mph (88 kph), but threatened flash floods and mudslides in mountainous areas, the National Hurricane Center said. Tropical Storm Edouard, moving through the Atlantic Ocean, strengthened but remained far from land and was a threat only to shipping interests. At 2 p.m. EDT (1800 GMT), the center of Tropical Storm Dolly was located at latitude 21.9 north, longitude 99.0 west, about 75 miles (121 km) west-southwest of Tampico, Mexico, and was moving west-northwest at 13 mph (21 kph). A hurricane warning for coastal areas of Mexico was discontinued. Forecasters said they expected Dolly to continue weakening as it moved into the mountains, but residents were warned to be alert for torrential rains and life-threatening flash floods. The storm could dump six to 12 inches (15-30 cm) of rain on parts of Mexico, they said. Radio network Radio Red reported 2,300 people were evacuated from the low lying regions around Tampico and that rivers were rapidly rising in the region from the torrential rains dumped over a wide area of southern and eastern Mexico. Ruben Diaz Garza, director of the local newspaper El Sol de Tampico, told Reuters that Dolly had made around 1,500 people homeless and that the entire port of some 500,000 was without electricity and drinking water. Dolly raced across the Caribbean this week to slam into Mexico's Quintana Roo state on Tuesday. It burst into the Gulf of Mexico on Wednesday after crossing the Yucatan Peninsula on Wednesday, home to hundreds of Maya ruins. 2149 !CCAT !GCAT !GDEF The British Petroleum Co denied Thursday a report published in the New York Times suggesting that the Colombian army was on its payroll or somehow under its control. The company's BP Exploration Company (Colombia) Ltd issued the unusual denial in reponse to a New York Times story referring to a recent upsurge in guerrilla activity in Colombia and steps it said BP had taken to confront them. "The implication in the New York Times article that the Colombian army is therefore somehow in the pay of BP is wrong," the company statement said. "Nor is the Colombian army in any sense under BP's control or direction," it said. BP conceded that it and its partners share the cost of military protection of the Cusiana and Cupiagua oil development project in Colombia's eastern plains. But it said in a statement that "the payments made by BP and its partners to the Ministry of Defense are confined to the provision of non-lethal aid -- i.e. food, clothes. accomodation, transport, communication and health programs." It also stressed that the payments are made by all four partners in the Cusiana development in Colombia's eastern plains, with the largest share coming from the state oil company Ecopetrol. It also denied that the security arrangement was "a recent response to the upsurge in guerrilla activity described by the New York Times. "The oil industry has long been exposed to particular risk in Colombia and arrangements such as these have been in place from the early stages of oil development," it said. The New York Times report said BP's three-year protection deal with the Defense Ministry had just been signed and was valued at $54 million to $60 million -- a cost to be borne solely by the British oil firm. A BP spokesman said the three-year agreement was signed in 1995, however, and valued at $11.6 million. Ecopetrol bears 50 percent of the cost, he said, with 19 percent going to BP, another 19 percent going to Total of France and 12 percent to Dalls-based Triton Energy. "Other oil companies, and many businesses outside the oil sector, have similar arrangements," the company statement said. 2150 !GCAT !GDIS !GENV Mexico's northeast coast braced on Thursday for Dolly, freshly upgraded to hurricane status and on track to strike land sometime on Friday morning, according to forecasters in Mexico and Miami. National Weather Service meteorologist Pablo Escamilla said Dolly was now packing sustained winds of 120 kph (75 mph) and gusts of up to 150 kph (93 mph), which makes it a weak Category One hurricane. Hurricane warnings were posted from Veracruz to La Pesca on the northeast coast, and major ports have been closed to shipping. At 6 p.m. EDT (2200 GMT), Dolly was located 220 km (137 miles) northeast of Veracruz and was moving at 17 kph (11 mph) in a west, northwesterly direction. It is expected to hit the coast in the early hours of Friday near Laguna de Tamiahua, Veracruz, a tiny town some 300 km (186 miles) northeast of Mexico City and 80 km (50 miles) south of Tampico, Tamaulipas, a major port. "We expect the storm to strengthen during the night before making landfall," Escamilla said. Captains from Mexico's three crucial Gulf of Mexico crude export ports told Reuters earlier on Thursday that Pajaritos, Dos Bocas and Cayo Arcas ports remained closed to shipping. Mexico's Communications and Tranportation Ministry confirmed the closures in a statement. The three ports are among 37 in the Gulf currently shut down because of Dolly. In Miami, the National Hurricane Centre forecast that Dolly's centre would strike the coast sometime on Friday morning. Hurricane force winds extended up to 30 miles (48 km) from the storm's centre, and tropical storm force winds extended outward up to 175 miles (282 km). The centre also said that Tropical Storm Edouard gained little strength as it moved westward across the distant Atlantic Ocean. At 5 p.m. EDT (2100 GMT), Edouard's centre was near latitude 13.6 north, 35.1 west, or about (1,284 km) west of the Cape Verde Islands off Africa's coast, and moving west near 14 mph (23 kmh). That motion was expected to continue on Friday, with some slight strengthening possible during the next 24 hours. 2151 !GCAT !GPOL The salaries of Leonel Fernandez, new president of the Dominican Republic, and other officials will have to be raised if his administration is to wipe out corruption, his spokesman said on Thursday. Fernandez was taken aback when he learned his salary would be the equivalent of about US$300 per month, spokesman Miguel Guerrero said. Fernandez will earn the same as his predecessor, Joaquin Balaguer, the blind, 89-year-old leader who served seven terms as the Caribbean nation's president. The presidential salary of US$3,600 per year compares with $12,000 per year for members of his cabinet. "It has been a cause for concern," Guerrero said, noting that Fernandez, who is divorced, has two children. Fernandez, 42, had not made a lot of money in his career as a lawyer and has no independent fortune, he added. Fernandez was inaugurated as president last Friday and said one of the most important tasks of his new government was to eliminate corruption. To do this, Guerrero said, it was imperative to restructure the salary of the president, vice president, cabinet ministers and the rest of the public sector. "It will be impossible to confront corruption successfully with these salary levels," Guerrero said. 2152 !C12 !CCAT !E21 !E212 !ECAT !GCAT !GCRIM The Nicaraguan government will fight a suit filed against it in a U.S. court on Thursday by a prominent investment company that wants to recover $26 million in debt plus interest, Nicaragua's Central Bank president said. "There is no basis to their suit. We made it explicitly clear to buyers that Nicaragua couldn't pay back the full amount of the debt, but only eight cents on the dollar," Central Bank President Evenor Taboada told Reuters. In court papers, LNC investments Inc, a unit of Leucadia National Corp, said Nicaragua was in default of $26 million in debt obligations. LNC asked for the recovery of the $26 million in principle and additional contractual and/or penalty interest that had accrued since 1986. "After all these years, these investors are trying to collect now, but we're confident we can make our case in court," Taboada said. -- David Koop, Managua bureau 505 2663300 2153 !GCAT !GCRIM !GPOL Panama's police drug unit said on Friday it was closing its investigation into how drug money entered the ruling party's 1994 electoral campaign after concluding there had been no impropriety. "Everything was analysed, such as how they received the checks, and we arrived at the conclusion that there wasn't any illicit behaviour," Rosendo Miranda, head of Panama's Technical Police drug unit, told reporters. The scandal began after two checks for $51,000 each were contributed to President Ernesto Perez Balladares' campaign by accused Colombian drug lord Jose Castrillon Henao, currently held in a Panama City jail. The findings will now be sent to a circuit court judge for a final ruling. 2154 !GCAT !GCRIM !GPOL !GVIO At least two people were killed on Friday when demonstrators protesting against the Colombian government's drug crop eradication programme clashed with security forces for a second day, authorities said. The clashes occurred in Caqueta, one of three southern provinces where thousands of peasant growers of coca leaf, the raw material for cocaine, have protested since mid-July against government efforts to wipe out the staple crop. William Sanchez, mayor of Belen de los Andaquies, southwest of Florencia, the provincial capital of Caqueta, said first reports indicated that four demonstrators had been killed there in early morning clashes with security forces. But later reports quoted authorities as saying only two dead had been confirmed. Sanchez, who spoke by telephone with the Noticiero Nacional television programme, said the victims were protesters gunned down by troops. At least 17 people were injured in the clashes, the domestic news agency Colprensa said. Florencia itself was a virtual war zone, meanwhile, after rioting erupted when soldiers firing teargas canisters sought to break up a protest march through the centre of the city. Contact with the city was virtually impossible after protesters firebombed the local offices of the state telephone company. But news reports said rock-throwing protesters, some of them armed with Molotov cocktails, had gone on a rampage across the city, attacking government offices and banks and ransacking the home of Florencia Mayor Hector Orozco. Interior Minister Horacio Serpa, who has said that the anti-government protests were being orchestrated by leftist guerrillas, told the Caracol radio network that the government was "very concerned" by the violent turn they had taken. He fell short of announcing any specific measures the government might take to halt the protests, but said "anarchy leads only to misfortune." One demonstrator was shot dead and eight others seriously injured on Thursday when they tried to fight their way past riot police manning barricades across a bridge on the outskirts of Florencia. In all, at least nine protesters have been killed in Caqueta and two neighbouring provinces since last month. The government, under heavy pressure from Washington to destroy vast tracts of coca and opium poppy this year, has vowed to continue spraying them from the air with herbicide in a bid to stem the flow of illicit drugs onto U.S. streets. 2155 !C12 !CCAT !E21 !E212 !ECAT !GCAT The Nicaraguan government said on Friday it was "surprised," but will fight a suit filed against it by a U.S.-based company over $26.3 million in unpaid debt plus interest. Leucadia National Corp, a New York-based banking and insurance company, filed the suit in a U.S. court on Thursday alleging Nicaragua had failed to pay back $26.3 million in debt Leucadia bought on the secondary market in 1986 and 1987. "I don't know why (Leucadia) is doing this. They know that Nicaragua has no more funds; that we could never, under any conditions, pay 100 percent of the debt," Nicaragua's Vice Minister of External Cooperation, Sergio Mario Blandon, told Reuters. Blandon said he will meet with lawyers to decide Nicaragua's legal strategy and is confident Leucadia's actions will not lead other creditors to demand payment. "It's an isolated case. We're confident it won't unleash a series of other such suits," he said. Leucadia bought the debt from the defunct New York securities firm Drexel Burnham Lambert and the former U.S. subsidiary of Britain's National Westminster Bank, which loaned the money to Nicaragua in 1980. In December, cash-strapped Nicaragua with international help agreed to buy back $1.1 billion of its commercial debt, paying creditors eight cents on the dollar, for a total of $88 million. But Leucadia refused to agree to the deal. "Maybe they now realize they were left out of a good deal, and by making a fuss they think they can re-open the negotiations," Blandon said. Nicaragua's Central Bank President Evenor Taboada said he thought Leucadia's suit was off base. "We made it explicitly clear to buyers that Nicaragua couldn't pay back the full amount of the debt, but only 8 cents on the dollar," he said. Nicaragua, generally considered the poorest country in Latin America after Haiti and one of the most indebted, is trying to reduce the size of its debt through debt forgiveness by creditor governments and buying back its commercial debt. It has been included in an initiative by the G-7 countries to ease the debt burden on the world's poorest countries. Leucadia is also suing the African nation of Zaire for non-payment of a smaller loan. -- David Koop, Managua bureau, (505) 266-3300 2156 !GCAT !GVIO Police have beefed up security in Trinidad and Tobago to quell fears of an uprising fuelled by tensions between the government of the twin-island Caribbean nation and its Moslem minority. Brig. Carl Alfonso, who heads the Trinidad and Tobago defence force, assured the public his troops and other security forces were loyal to the government. "The army is committed to the public safety and is prepared to work hand-in-hand with the police," he told Reuters. Rumours of an uprising similar to a violent coup attempt launched six years ago by the radical Black Moslem group, Jamaat Al-Moslemeen, came to a head last Friday after a radio report of an anti-government plot linked to the Jamaat. Workers were sent home from work early. Government officials have dismissed the radio report as "malicious speculation". But police have beefed up security at government buildings, set up roadblocks at key intersections and mounted more frequent patrols. National Security Minister Joe Theodore said the government was investigating information it received last Saturday that some 300 army-type combat uniforms had been brought into the country and distributed. He asked the public to report to the police anyone in possession of such uniforms. Jamaat members on July 27, 1990, failed in a bid to topple the government of then-Prime Minister Ray Robinson in a coup attempt that killed 34 people. More recently the group has been at odds with the government of Prime Minister Basdeo Panday over the state's attempt to evict Jamaat from a stretch of land on the western fringe of Port of Spain. Jamaat wants the government to compensate it for the destruction of its headquarters, and won a compensation award of more than $1 million in 1994. But the money has never been distributed because it has been tied up in court, officials said. Minister of Legal Affairs Kamla Persad-Bissesar said the government could not act until there was a final resolution in the courts. Jamaat attorney Subhas Panday, who also is the prime minister's younger brother and a former member of parliament, said the Moslem organisation wanted the money and intended to take action to get it. But he said it would not be violent. "The Jamaat will do nothing to disturb the peace and quiet or in any way endanger the security and stability of the society," he said. Of Trinidad's 1.2 million population, 33 percent are Roman Catholic, 25 percent are Hindu and six percent are Moslem. About 40 percent of the population is of African descent, and about 40 is Indian, with the remainder of mixed, European and Chinese descent. 2157 !GCAT !GCRIM !GDIP The Chilean Supreme Court lifted all charges on Friday against two retired army officers accused of murdering a Spanish diplomat during Chile's former military regime, applying a 1978 amnesty to the case. The court said the grisly murder in 1976 of Carmelo Soria was covered by an amnesty dictated by the former military government of General Augusto Pinochet. The amnesty benefited officers who committed human rights abuses during his rule. The ruling effectively ended the Soria family's hopes of prosecuting the case, a frequent point of friction between Chile and Spain, in Chilean courts. The ruling cannot be appealed. Soria, a Spanish diplomat who worked for the Santiago-based U.N. Economic Commission on Latin America (CEPAL), was found in a ravine with his backbone snapped. There were also indications he had been severely tortured. Two now-retired army officers, Jose Rios San Martin and Guillermo Salinas, were charged with kidnapping and torture in the case. Soria's family said the murder was not covered by the amnesty because he held diplomatic status, an argument rejected both by military and civilian courts. The family's arguments amounted to "mere affirmations by witnesses, without any documented, official backing," said the court's ruling. It added that Soria's position at CEPAL was not high enough to give him the benefits of diplomatic status. Evidence presented in the case showed that Soria was abducted by agents of Pinochet's feared secret police, the DINA, on June 14, 1976, and was later tortured to death. 2158 !GCAT !GPOL Ecuador's President Abdala Bucaram has announced he will hold regular lunches in his presidential palace for members of the country's different ethnic groups as of next week. "It was about time for the Indians, the blacks and the mixed-bloods to begin eating in the palace with their president because this is not a palace exclusively for the potentates and ambassadors and protocol," Bucaram said late on Thursday. "In these weekly lunches we are going to get to know the problems of the Indian, mixed-race, black and peasant sectors," he said. He has invited 35 Indian leaders to lunch next Tuesday. Bucaram, who was elected on a populist platform last month, also plans to create a ministry for ethnic cultures. The Andean nation's population of 11.4 million is 47 percent indigenous. 2159 !GCAT !GDIP U.S. demands that Colombia enact reforms to create a "perfect and impeccable" judicial system by next year are impossible to meet, a former Colombian envoy to Washington said on Friday. Carlos Lleras de la Fuente, who resigned as ambassador to Washington in April, said he had obtained memorandums outlining "12 or 14" key demands the Clinton administration has made of Colombia. Colombia was likely to be hit with punitive economic sanctions unless the reforms are carried out, Lleras said. "It's impossible to think that in five months our poor, weak and limping judicial system can be turned into something perfect and impeccable, possibly even better than the one in the United States," Lleras said. "But that seems to be the gist of these documents from our neighbours up north." Lleras, in an interview with RCN news radio, said Washington was putting the government of President Ernesto Samper "up against the wall" by asking for too much in too little time. "It looks as if they (the United States) want to create a problem when it comes to Colombia," he said. One of the reforms the United States is pressing for is an end to Colombia's constitutional ban on extradition in effect since 1991. Drug kingpins waged a bloody campaign of bombings and assassinations in the late 1980s and early 1990s to pressure Congress into enacting the ban on extradition. Constitutional amendments in Colombia must be passed by two consecutive sessions of Congress, making it impossible for the ban on extradition to be lifted this year. Justice Minister Carlos Medellin said another troublesome demand Washington was making would allow U.S. agents to board ships in Colombia's territorial waters to search for drugs. Such permission could not be granted without an amendment to the constitution, he said. Lleras resigned in April, one month after the United States decertified Colombia as a partner in U.S. counternarcotics efforts. He cited allegations that Samper used drug money to finance his 1994 election campaign. 2160 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GVIO Argentina's largest CGT trade union confederation announced Friday that unions will meet September 5 to vote on a 36-hour strike. CGT leader Gerardo Martinez said in a televised assembly that the labour movement's Central Confederal Committee would meet "with the aim of charting a battle plan and if necessary, of changing the (CGT) leadership." Last Tuesday, a vote on the strike by the committee was thwarted by a shootout between members of the CGT and the hardline breakaway MTA union federation. A September strike would follow a 24-hour walkout August 8 against government austerity measures, which sparked violent clashes between police and demonstrators. Martinez has promised to resign if the CGT leadership is found responsible in any way for Tuesday's gunfight, in which seven men were injured. He has been criticized by some unionists for being too soft on the economic policies of the Peronist government and said Friday he was willing to step down if it would help the unions close ranks against government austerity measures. "I will put my resignation at the disposal of the CGT if it helps unite the worker movement," he said. -- Carmen Pignotti, Buenos Aires Newsroom 541 318-0657 2161 !E21 !E211 !ECAT !GCAT !GPOL Brazilian President Fernando Henrique Cardoso has sent to Congress a regulatory bill setting up the so-called CPMF check tax, officials said. Congress has already approved, after heated debate and last-minute deals, a consitutional amendment permitting the implementation of the tax, which would levy 0.2 percent on all financial transactions and is aimed at funding health services. The draft of the regulatory bill allows for government bodies, including the federal government, the states and cities and state-owned firms, to be exempt. Transfers between accounts belonging to the same person or firm are also exempt, as are financial transactions by institutions on behalf of third parties, a measure intended to avoid double-taxation. Those earning less than three minimum salaries a month, currently 336 reais, and state pensioners will be compensated. In a preamble to the draft bill, Finance Minister Pedro Malan and Health Minister Adib Jatene said the tax, to run for a year, was expected to raise 400 million reais a month. No date has yet been set for Congress to start discussing the bill. -- Michael Christie, Brasilia newsroom 55-61-2230358 2162 !GCAT !GDIS !GENV Hurricane Dolly bashed into Mexico's eastern state of Veracruz Friday, dumping torrential rains, the National Meterological Service said in an update. The eye of huge weather front made landfall around 1000 local/1500 GMT about 40 km south-south east of the port of Tampico, packing sustained winds of 120 km/h (75 mph) and gusts up to 150 km/h (94 mph), it added. There were no immediate reports of deaths or damage in the zone, which is at the northern tip of the agricultural state of Veracruz, close to the border with Tamaulipas state. "It is expected that Dolly will continue edging west-northwesterly, gradually losing force as it moves over land," the service predicted. Heavy rains were registered across eastern and southern Mexico and shipping alerts remained in place from Puerto Progreso in Yucatan state to Matamoros, the most northerly point of Tamaulipas. Ports distant from where Dolly touched land had started to re-open. At the height of storm in the Gulf of Mexico 37 ports were closed. Two of Mexico's main crude export ports -- Dos Bocas and Cayo Arcas -- have already re-started operations and a third -- Pajaritos is about to re-open, port sources said. Veracruz is one of Mexico's most prosperous agricultural states. In the low-lying zone where Dolly came ashore, the main activities are livestock farming, sugar cane growing, and citrus production. --Chris Aspin, Mexico City newsroom (525) 7289530. 2163 !GCAT !GPOL Seven out of 10 Argentines disapprove of President Carlos Menem and eight out of 10 do not believe his Peronist government can solve the country's problems, according to a Gallup poll published Friday. The poll carried by Pagina 12 newspaper showed a similar level of disagreement with the government's economic policies, with 72 percent expressing disapproval, and clear pessimism about social tension with 58 percent believing it will grow. The personal approval rating for Menem, who was reelected for a second consecutive term in May 1995 with 50 percent of the vote, has tumbled sharply. He wins 19 percent approval and 71 percent disapproval in the August poll, compared with 47 percent approval and 45 percent disapproval in May 1995. Sociologist Marita Carballo, head of Gallup Argentina, told Pagina 12 that the poll result "is the worst for the government of Carlos Menem since it came to power in 1989." Faith in the government's ability to address Argentina's problems has also tumbled, with only 17 percent expressing confidence compared to 40 percent in May last year. The number expressing a lack of confidence has risen to 80 percent from 57 percent the month of Menem's reelection. The Gallup Argentina poll, which surveyed 970 Argentines of all ages from all over the country in mid-August, shows 58 percent of people worrying that their income barely allows them "to reach the end of the month", one fifth saying they are getting into debt and 12 percent spending their savings. Argentines have far more faith in the press, the church and even the armed forces than in politicians, unionists and the judiciary, showed the poll, which has a 3.5 percent margin of error. Political parties win the trust of just four percent of the population, the poll shows, with trade unions currently planning a general strike scoring just eight percent and the Congress just 10 percent. The judiciary is only trusted by 11 percent and the police by 15 percent. Business leaders win the trust of 19 percent and the armed forces of 26 percent, while the church is trusted by half the population of Argentina -- narrowly beaten by the press, which gets a 51 percent confidence rating. -- Stephen Brown, Buenos Aires Newsroom +541 318-0695 2164 !E51 !E512 !ECAT !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto begins a three-day visit to Brazil on Saturday to boost trade and strengthen ties with the world's largest Japanese community outside Japan. Hashimoto is scheduled to spend Sunday in the sprawling industrial metropolis of Sao Paulo, home to most of the 1.3 million Brazilians of Japanese descent. Brazil, Latin America's largest nation, will be Hashimoto's third stop on a 10-day trade and investment tour of the region that began in Mexico on Tuesday. He is Japan's first head of state to visit Brazil in almost 15 years. While in Sao Paulo, Hashimoto will meet with Japanese community leaders and place flowers at a mausoleum of early Japanese immigrants, who began arriving at the turn of the century to farm Brazil's vast interior. Brazil's controversial auto import rules, which have drawn fire from the United States, Japan, South Korea and the European Union, will be among the topics discussed by Hashimoto and President Fernando Henrique Cardoso in the capital of Brasilia. Cardoso made an official visit to Tokyo in March, when he invited the Japanese leader to Brazil. Diplomatic sources say Hashimoto feels a particular attachment to Latin America, having worked as a young man for a textile company that was active in Ecuador. "The whole idea (of the visits) is to show Japanese business that we think Latin America is a place that must be invested in," said a senior Japanese diplomat in the capital of Brasilia. "The visit reflects our renewed confidence in Brazil." Japanese investment has been flowing back to the region in recent years as Latin American nations re-establish economic credentials lost during the 1980s debt crisis and the long bouts of hyperinflation that followed in many countries. Japan's foreign direct investment in Brazil was $1.23 billion in 1994, up from just $171 million in 1991. Trade between Brazil and Japan totalled $6.5 billion last year, making Brazil Japan's leading Latin American trade partner, followed by Mexico with about $5 billion. Hashimoto is scheduled to leave Chile early on Saturday and fly to Brazil's spectacular Iguacu Falls, where nearly 300 waterfalls cascade over a 1,000-foot (300-metre) wide precipice at the border of Argentina, Paraguay and Brazil. After visiting the nearby Itaipu hydroelectric plant, Hashimoto will fly to Sao Paulo. On Sunday he will visit a museum of Japanese history in Brazil and meet with Sao Paulo state Governor Mario Covas before flying to Brasilia on Sunday afternoon. On Monday, Hashimoto leaves Brazil for Peru. He then travels to Costa Rica, where he is scheduled to meet with leaders of a number of other Latin American nations. 2165 !GCAT !GCRIM !GDIP !GVIO The pilot who ditched a small Cuban plane in the Gulf of Mexico after three passengers forced him to fly toward the United States has returned home, as he had requested, Cuban state media reported on Friday. Adolfo Perez Pantoja, 47, flew into Havana on Thursday on a flight from Miami. The three hijackers in the Aug. 16 incident are still being held by U.S. authorities, who plan to put them on trial. The Cuban government, invoking existing bilateral immigration accords, is demanding the U.S. government return the three to face Cuban justice. Interviewed on state television and radio, Perez said one hijacker put a revolver to his head and forced him to fly his four-seater plane, used for tourist trips, toward Florida. He had to ditch the plane when it ran out of fuel. The four occupants were rescued by a Russian freighter before being handed over to the U.S. Coast Guard. Perez said he gave testimony to a U.S. court about the hijacking. "At all times, I said that I wanted to return home to my country," he told state radio. The three hijackers asked for political asylum in the U.S. The hijacking is the latest incident involving illegal Cuban emigrants to strain both bilateral immigration accords and already-tense Cuban-U.S. relations. Cuba wants the United States to return the Aug. 16 hijackers, another one who fled the communist-ruled island July 7 and 11 members of a group that left in a boat last week. Sixteen other passengers on the boat have already been returned. Havana says not handing back these people violates bilateral immigration accords signed in September 1994 and May 1995. These say that illegal Cuban emigrants who are picked up at sea or cross to the U.S. naval base at Guantanamo Bay in eastern Cuba should be returned. The U.S. government said on Thursday it would continue to honour the immigration accords but would deal with migrant-smugglers and hijackers under U.S. law. 2166 !C24 !CCAT !GCAT !GWEA Pajaritos, one of three crucial Mexican crude export ports, still remains closed to shipping although is set to re-open at 1300 local/1800 GMT, the port captain said Friday. "We are still closed because Hurricane Dolly still is a little too close and we want to wait until it makes landfall," Juan Francisco Resendez Estrada told Reuters in a second telephone interview. Captain Resendez, who is in charge of Coatzacoalcos port and has jurisdiction over Pajaritos, said he was delaying re-opening because he did not want to have to close again, if Dolly makes a last minute change of direction. "We do not want the same to happen as last year with Hurricane Roxanne when he re-opened and were forced to close again because the hurricane came back on us," Resendez said. Hurricane Dolly is expected to make landfall between 1200 and 1300 local (1700 GMT and 1800 GMT) on the border of the Mexican states of Veracruz and Tamaulipas, the National Meterological Service said. Pajaritos is in the south of Veracruz state. --Chris Aspin, Mexico City newsroom (525) 7289530. 2167 !C24 !CCAT !GCAT !GENV !M14 !MCAT Mexico's Cayo Arcas crude port in the Gulf of Mexico reopened early Friday, the port captain told Reuters. Both Ciudad del Carmen and Cayo Arcas re-opened at 0905 local time (1405 GMT)," Jorge Rios Macbeth told Reuters in a telephone interview. Coatzacoalcos port captain Juan Francisco Resendez Estrada said he was considering re-opening the port of Pajaritos, whoch comes under his jurisdiction, between 0930 local/1430 GMT and 1000 local/1500 GMT. "We are going to see what the situation is and consider re-opening soon," he said. The captain of Mexico's third crude port in the Gulf of Mexico, Dos Bocas in the state of Tabasco, was not immediately available to confirm if that port had also reopened. But Captain Ruben Villegas Dominguez, the captain of Frontera port in the same state, said he had re-opened his port to large ships earlier this morning. "I cannot comment about Dos Bocas, you will have to ask there," he said. The three crucial crude export ports have been closed for two days because of the threat posed by Hurricane Dolly, which has now passed further to the northwest and is poised to make landfall on the border of the states of Veracruz and Tamaulipas. The three ports are the main exit points for crude shipment to the United States and Europe. --Chris Aspin, Mexico City newsroom (525) 7289530. 2168 !E12 !ECAT !GCAT !GPOL Argentine Economy Minister Roque Fernandez said Friday he was confident ruling Peronist Party legislators would help pass his controversial austerity package in early October. "Peronism is a big, opinionated party," he told local radio, referring to criticism of his belt-tightening measures from within party ranks. "But there is strong support. We will have (the austerity package) in the first week of October," he said. Fernandez went on to blame congressional reluctance to endorse his unpopular measures -- which include tax hikes and raising the retirement age for women to 65 from 60 -- on opposition forces. "The opposition not only does not come up with alternative proposals, but is also trying to prevent this proposal from being passed quickly," Fernandez said. Fears that the package may suffer delays or severe alterations in Congress have been taking a toll on Argentine stocks and bonds all week. Unions are also planning to go on strike in September against the government's austerity plans. -- David Haskel, Buenos Aires Newsroom +541 318-0652 2169 !GCAT !GDIS Hurricane Dolly, the fourth big weather front of this Atlantic season, is poised to make landfall on the border of Mexico's Veracruz and Tamaulipas states, weather authorities said Friday. "Dolly will continue picking up steam gradually...and it is expected to make landfall at 1300 local (1800 GMT) close to the town of Panuco, Veracruz, and 11 km (7 miles) west of Tampico, Tamaulipas, with sustained winds of 130 km/h (81 mph) and gusts up to 160 km/h (100 mph) as a category one hurricane on the Saffir-Simpson scale," the service said. Dolly, currently moving west-northwest at 17 km/h (11 mph), has coastal communities in the two states on maximum alert, Civil Protection Agency officials said. Shipping alerts are still in force between Puerto Progreso in Yucatan state and Matamoros in Tamaulipas, across the border from Brownsville, Texas, the weather service said. A total of 37 ports were closed Thursday as Dolly whipped up heavy seas throughout the Gulf of Mexico. Heavy rains were reported across the east and south of the country, with flooding in the northern city of Monterrey. Among the ports closed were Mexico's three Gulf crude export ports -- Pajaritos, Dos Bocas and Cayo Arcas -- captains for the ports confirmed Thursday. Dolly raced through the Caribbean earlier this week and slammed into the Yucatan Peninsula, causing light damage and leaving less than 100 people homeless. It crossed over into the Gulf of Mexico Wednesday and since has edged slowly toward Veracruz and Tamaulipas. --Chris Aspin, Mexico City newsroom (525) 7289530. 2170 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The chief of Argentina's CGT main union federation said Friday he met with government officials but denied he was negotiating to avert a planned general strike. "We weren't negotiating any strike with them," CGT boss Gerardo Martinez told the state-owned Telam news agency. "Our stance is still for changes to the framework of an economic policy that generates unemployment and recession." Martinez said Thursday's meeting was requested by the government, which was represented by top congressmen including the powerful former Cabinet Chief Eduardo Bauza. Union heads are due to hold a procedural meeting Friday but said they decided to put off a planned strike vote for eight or nine days. It was the second time the unions have postponed the strike vote, which they first put off last Tuesday after a disagreement between supporters of the CGT and the hard-line MTA splinter group. Seven workers were hurt in the shootout. The CGT and the MTA, which represents transport unions, have since edged back into talks together. The two groups both participated in the successful 24-hour general strike August 8 and are planning to stage a new one in September. The daily Clarin Friday quoted union sources saying that Martinez and other top CGT officials with close links to the Peronist Party government were about to lose their jobs to more militant officials, including MTA representatives. One of the disagreements between the CGT and the MTA was over the length of the new strike. The CGT favored a 36-hour stoppage while the MTA wanted 48 hours. CGT officials said after the shootout they now wanted a shorter 24-hour strike, without any union marches, because they wanted to avoid any risk of further violence. -- Jason Webb, Buenos Aires Newsroom +541 318-0655 2171 !GCAT These are the highlights of the main Sao Paulo and Rio de Janeiro newspapers this morning. GAZETA MERCANTIL -- CENTRAL BANK PREPARES SPECIAL LOAN FOR BAMERINDUS Brazil's Central Bank is considering giving private bank Bamerindus a long-term discount line to solve its liquidity problems. -- PETROBRAS POSTS 655 PCT PROFIT RISE Brazilian state-owned oil giant Petrobras has posted first half profits of 303 million reais ($303 million), up 655 percent from the first six months last year. -- PUBLIC SECTOR DEFICIT GROWS IN JUNE Brazil's Central Bank said the public sector deficit reached 12.8 billion reais ($12.8 billion) in June, the equivalent of 3.57 percent of gross domestic product (GDP), up from 2.33 percent of GDP last year. O GLOBO -- RIO MAYOR CANDIDATE CONDE UP AT 39 PCT IN POLLS Rio de Janeiro mayoral candidate Luiz Paulo Conde has risen in the polls to 39 percent of the vote, and for the first time the survey shows he would win in the first round of voting. -- RIO MAYOR LOWERS REAL ESTATE TAX IN VIOLENT AREAS Rio de Janeiro Mayor Cesar Maia has lowered the IPTU real estate tax in areas where the value of real estate has fallen due to the proximity of violent neighborhoods and shantytowns. -- PUBLIC SECTOR WORKERS TO GET PAY RISE IN 1997 The federal government is to grant a pay rise to public sector workers in the 1997 budget, estimated to bring personnel costs to 44 billion reais ($44 billion). FOLHA DE SAO PAULO -- MILITARY REJECTS CHARGES AGAINST PARA MILITARY POLICE A military court in Brazil's northern state of Para has rejected homicide charges brought against 155 military police officers said to have been involved in the April massacre of 19 landless peasants in Para's Eldorado do Carajas. -- BOMB FOUND AT SAO PAULO BOOK EXHIBITION A small homemade bomb was found in a bathroom at the 14th Bienal do Livro book exhibition in Sao Paulo. It was removed and made safe by military police. Reuters has not verified the stories and cannot vouch for their accuracy. -- Simona de Logu, Rio de Janeiro newsroom, 5521 507 4151 2172 !GCAT !GPOL The Peruvian Congress approved in the early hours of Friday morning a key constitutional interpretation that paves the way for a third reelection bid from President Alberto Fujimori in 2000. Legislators voted 70-3 in favour of the proposal after an often fiery debate which lasted more than nine hours. "This measure means that if President Alberto Fujimori wants to run again for the presidency, he could," said Ricardo Marcenaro, a legislator with Fujimori's New Majority-Change 90 movement. Under Peruvian law, a president who has been elected for two consecutive terms in office is not allowed to run in the following election. But the single-chamber Congress, controlled by the government with 70 of a total 120 seats, voted in favour of an interpretation that means Fujimori's first term in office will not be taken into account should he stand for reelection. Fujimori was elected president in 1990 and again in 1995. But after he dissolved the then opposition-dominated parliament in 1992, a new constitution was written the following year by a reformulated, pro-Fujimori Congress. Congress upheld on Friday that only elections under the new constitution had validity when an incumbent president wished to put himself forward as a candidate for the next term. Fujimori, who enjoys a more than 60 percent popularity rating, is widely expected to seek a third term. Although he has not formally announced his intention, he has been quoted as being in favour of another bid for the presidency. Opposition leaders condemned Congress' measure as an abuse of Peru's constitution by a weak legislature subservient to an authoritarian leader. Most anti-government legislators walked out of the chamber in protest prior to the vote at 1 a.m. local time (0600 GMT) after a debate that often degenerated into personal insults. "I reject the reelection in the name of justice, liberty and the dignity of Peruvians," said Fernando Olivera Vega, of the opposition Independent Moralizing Party. "This represents an abuse of the constitution." Prominent local political analyst Francisco Sagasti said the vote "shows there is little interest (from the government) in respecting the letter or the spirit of the constitution." Local and foreign financial markets, however, were expected to react favourably to the enhanced prospect of a third term for Fujimori. "His reelection does not worry the market, because there is confidence in his administration. When he was reelected in 1995, the market responded favourably with continuous rises," said Pablo Navarro, a stockbroker with the local investment house Fortuna. In six years of power, Fujimori has virtually defeated Peru's communist guerrillas, radically reformed the economy along free-market lines and reintegrated the nation into international financial markets. But he is often criticised at home for failing to overcome the high levels of poverty and unemployment that still afflict this South American nation of 24 million people. 2173 !GCAT !GDIP Representatives of Nicaragua and Honduras on Thursday hastily sought to calm tensions over a border dispute which flared up this week when the Honduran army chief said he was ready to go to war. Honduran Vice President Guadelupe Gerezano and Nicaraguan Foreign Minister Ernesto Leal both minimised the conflict and said such incidents should be resolved diplomatically. "So far in 1996 there has not been one single incident of a boat being captured on the Caribbean Sea near Honduras, and no incidents are being registered," Leal said. "I don't know who wants to start a conflict, but there's nothing there," he said. The countries have an ongoing border dispute over a stretch of the Atlantic Ocean rich in fish. Honduras claims the maritime border is the 15th parallel and Nicaragua the 17th parallel. The dispute was ignited this week when Honduras' armed forces chief Gen. Raul Hung said, "I have my budget, I have my reserves of fuel in case that, God forbid, we enter a confrontation. I have what is needed to respond." His comments came after Nicaragua launched three new coast guard boats off its Atlantic coast and Honduran fishermen said they were chased by Nicaraguan patrol boats while in Honduran waters. Honduran Vice President Gerezano dismissed the remarks, saying, "I think his statements were distorted since no minister can make those kind of statements, because the person who runs the country's foreign policy is the president." Gerezano was speaking at a meeting of Ibo-American women ministers in Managua. Nicaraguan navy vessels and Honduran fishing boats engage in periodic clashes leading to regular diplomatic incidents and mutual accusations. 2174 !GCAT !GDEF !GPRO The bodyguard who failed to save top politician Luis Donaldo Colosio from assassination in 1994 has been given a new military job in the eastern Yucatan peninsula, government news agency Notimex said on Thursday. Gen. Domiro Garcia Reyes of the elite Estado Mayor presidential guard took up his new post on August 1 as head of the Estado Mayor in the 32nd Military Zone in Yucatan state, Notimex said. The Defence Ministry refused to comment on the report. Colosio, the candidate of the long-ruling Institutional Revolutionary Party (PRI) for August 1994 presidential elections, was shot dead March 23, 1994, after a campaign rally in the northern city of Tijuana. Garcia, who has written a book about the murder, has denied widespread press reports alleging that he was involved. 2175 !GCAT !GVIO Leftist rebels are believed responsible for the kidnapping of an Italian oil engineer seized by gunmen in northwest Colombia on Wednesday, military officials said on Thursday. Lino Chioccioli, who works for the Italian oil and gas exploration firm Salpem, was the second Italian to be abducted this month in Colombia. Spokesmen for the Colombian Army's 14th Brigade, based in the northwest city of Medellin, said National Liberation Army (ELN) rebels were the leading suspects in Chioccioli's kidnapping. The spokesmen offered no evidence to support their claim, saying only that peasants claimed Chioccioli had been bundled off by three men on horseback armed with sub-machine guns and pistols. But the ELN, founded by radical Roman Catholic priests in 1996, maintains a strong presence in the area where the kidnapping occurred and specialises in kidnappings and attacks on oil and coal projects. Chioccioli was overseeing improvements being made on the Ocensa oil pipeline, a frequent target of rebel sabotage. 2176 !E51 !E512 !ECAT !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto arrived in Chile on Thursday on the second leg of a Latin American tour to drum up more trade with a region traditionally dominated by the United States. Hashimoto, arriving from Mexico, will meet President Eduardo Frei for talks aimed at giving a high-level political push to the two countries' growing trade ties. The Japanese prime minister was also due to sign financing agreements for a local pollution control programme, a key issue in Chile where winter smog chokes the capital Santiago. Officials said the visit was part of a new Japanese drive to expand its trade and investment ties in Latin America, an area it long shied away from because of fears of political turmoil and the economic dominance of the United States. "There is a certain revaluing of Latin America by the Japanese, and we want them to know that we offer the best conditions to be their bridge into this continent," said a top Chilean official. "This is a tremendously important visit for us," he said. "We have a growing economic relationship, to which we are now adding an important political component." Plans to boost trade and investment will feature high on Frei's agenda in talks with Hashimoto on Friday, the official said. He said Chile hoped to present itself to Hashimoto as Japan's best hope for a gateway to Latin America due to Chile's record of stable economic growth and its long Pacific coast studded with modern ports. Although Japan is Chile's second largest trading partner, it is a distant seventh in the ranking of foreign investors by country with about $500 million invested. The United States is number one in both categories. The two nations have a couple of points of friction. Chile has supported a worldwide ban on whaling, opposed by Japan, and has also strongly protested shipments of nuclear waste through Chilean waters on their way to Japan from Europe. "Both are areas of disagreement but we have a civilised dialogue on them. I wouldn't call them real conflicts," said the official. Hashimoto was due to leave early on Saturday for Brazil. 2177 !GCAT !GDEF !GDIP Australia said on Friday it was determined not to let India's veto kill a worldwide nuclear test ban treaty and vowed to lead a push for a United Nations resolution to keep the dream of a global pact alive. Foreign Minister Alexander Downer said Canberra had launched a campaign at the United Nations to revive the draft Comprehensive Test Ban Treaty (CTBT), after a disarmament conference failed to agree on a text in the face of Indian opposition. "What we don't want to do is let the CTBT die," Downer told a news conference during a visit to Beijing on Friday. "An enormous amount of effort has gone into it, there has been a very wide measure of agreement on the text. "We think the best way to take it forward is for us to ... take a resolution to the United Nations General Assembly in support of that text," he added. Government officials in Canberra said Australia would lead the charge to win agreement for the treaty and would look for co-sponsors for a U.N. resolution to allow it to be opened for signing despite the failure to reach a consensus. "We will work to achieve the treaty's endorsement during the current session of the U.N. General Assembly and its opening for signature at the earliest possible date," Downer said in a statement released in Canberra. The 61-nation Conference on Disarmament in Geneva, which needed a unanimous stance to allow it to approve a draft text, on Thursday decided it could not even agree to report its failure to the General Assembly. New Delhi, which had demanded nuclear powers commit themselves to move towards total disarmament, was able to block the treaty's progress singlehandedly -- prompting calls for a new way to be found to keep it alive. Diplomats have said there is little time left for the 51st General Assembly to open the pact for signature at a ceremony in late September. Australian ambassador for disarmament Richard Starr told Reuters in Geneva that Canberra still believed the treaty could be salvaged after nearly three years of negotiation and "decades of expectations". "There is a clear need for friends of the CTBT to consider action so that the whole international community will be able to consider, endorse and sign this valuable treaty," Starr said. "We would not want to see a treaty text die in a pigeonhole in Geneva," he said. Australia, using its standing as a middle-ranking, non-nuclear power, has sought to play a leading role in the campaign to end nuclear testing. Diplomats in Geneva said earlier this week the five declared nuclear powers -- Britain, China, France, Russia and the United States -- considered Australia best placed to present the draft treaty to the UN general assembly in the form of a resolution calling for a swift signing ceremony. Downer said there was still some way to go to ensure the treaty's survival but expressed optimism a resolution would find widespread support. "This is just the beginning of a process," he said. "I think there will be very strong support for our move." 2178 !GCAT !GDEF !GDIP Japanese air force pilots will start training to fly Russia's Sukhoi 27, one of the most advanced fighter planes in the world, defence ministry sources said on Friday. Details of the plan, the first of its kind for Japan's Air Self-Defence Force (ASDF), will be announced next week when the ministry reveals its budget request, the sources said. The training does not mean Japan is considering buying Sukhoi fighters from Russia, the sources said. Officials at Russia's general staff and at the Russian air force staff, quoted by Itar-Tass news agency, said they had no information about the reports. "This is the first we have heard of it," the general staff told Tass. The Japanese sources were commenting on a report in Friday's Asahi Shimbun newspaper that the ASDF will seek 50 million yen ($462,000) to send a few pilots to a privately run Su-27 training centre sanctioned by the Russian government. The aim will be to acquire knowledge of Russia's mainstay fighter, which is also operated by the Chinese air force, the Asahi said. Since the collapse of the Soviet Union, Japan has wanted to send officers to Russia to acquire military technology, but hesitated out of concerns that such moves might alarm the United States. This time, however, the U.S. air force is also sending its pilots to the same Sukhoi training centre, the Asahi said. The move is also intended as a message to China, whose military was mentioned as "cause for concern" in this year's Japanese defence White Paper after China showed off its military might against Taiwan earlier this year. "This is also meant as a message to China," the Asahi quoted an unidentified senior defence ministry official as saying. In a related move, four Taiwanese air force pilots tested the same Su-27 fighter earlier this year in the Ukraine to learn its capabilities, the mass-circulation China Times newspaper reported on Friday. The Taiwanese newspaper quoted unspecified sources as saying the air force sent the four-man team to judge the Su-27 as a reference for Taiwan's anti-air defence after China selected the Su-27 as its leading fighter. China's air force has 26 Su-27s and plans to buy 24 more, according to the authoritative Jane's All the World's Aircraft. The sleek, twin-engined fighter has been Russia's showcase fighter to the world since its debut in 1985. Its extreme agility in the air shocked the West in air shows around the world in the late 1980s. Many experts consider it a better plane than the F-15, Japan's mainstay fighter. ($1=108 yen) 2179 !GCAT !GDIS !GENV Typhoon Niki killed seven people when it roared past China's Hainan Island on its way to northern Vietnam, the China News Service said on Friday. The seven were killed as the typhoon ravaged the resort city of Sanya on the island province's southern tip, which was lashed by high winds of up to 150 kph (93 mph) and heavy rains, the agency said. The typhoon caused a suspension of the city's power and water supplies, a temporary closure of its international airport and left traffic in chaos, it said but gave no other details. Typhoon Niki swept across storm-battered northern Vietnam early on Friday but initial reports indicated the region had been spared further major damage. 2180 !GCAT !GDIP China on Friday proclaimed the sincerity of its desire for direct air and sea links with Taiwan and said conditions for such contacts were improving. China on Tuesday unilaterally introduced rules governing direct shipping links with Taiwan, raising hopes of an end to a decades-old ban on such contacts by the island which Beijing regards as a renegade province. "The promulgation of these documents ... fully shows the mainland's sincerity in this regard," the official Xinhua news agency said. Taiwan has banned direct shipping, air and mail links with the communist mainland since its Nationalist government fled to the island in 1949 after a civil war and sees them as its last bargaining chip in dealing with Beijing. "Conditions are gradually improving for realising direct links across the strait," Xinhua said. Relations between the two sides plummeted after Taiwan President Lee Teng-hui infuriated Beijing with a visit to the United States in May 1995. Taiwanese investors, who have poured more than $20 billion into China, are eager for direct transport links. Xinhua said the new rules would gain backing from Taiwan's shipping industry. "This will surely win support from the people of both sides, and also shipping entrepreneurs of Taiwan," Xinhua said. 2181 !GCAT !GDIP Australia's Foreign Minister Alexander Downer announced on Friday an agreement with China to expand their security dialogue, saying recent frictions had failed to spoil growing ties between the two Pacific powers. Disagreement over Taiwan, a coming meeting with the Dalai Lama and Chinese concerns over a Canberra-Washington security pact had not spoiled the atmosphere during meetings with his Chinese counterparts, Downer told a news conference in Beijing. "I have been able to develop a security dialogue between Australia and China," he said. "What I would like to see happen is us holding, on an annual basis, senior officials' talks about regional security issues." Downer said an Australian proposal for broadening existing annual bilateral disarmament talks into such a dialogue had been accepted by Chinese Foreign Minister Qian Qichen, but he gave no details of how they were likely to be organised. "It's symbolically important because it reaffirms ... that the Australian government does not support a policy of containment of China," he said. Downer's coming meeting with the Dalai Lama, Beijing's arch-rival for the loyalties of the Tibetan people, had not been a sticking point in talks with Premier Li Peng, he said. Beijing regards the Dalai Lama as an anti-China "splittist", and condemns all attempts by Tibet's supreme spiritual leader to gather international support for autonomy in the restive Himalayan region. Downer said he would meet the Dalai Lama when he arrived in Australia next month, but said the Chinese premier had made no direct mention of the visit. A defence pact in July between Washington and Canberra that raised hackles in Beijing had not been brought up as a Chinese concern, while a proposal to supply uranium to Beijing's rival Taiwan was far from becoming a reality that could disrupt growing ties, he said. Australian officials said Downer had fulfilled a pledge made last month in Hong Kong to raise the case of jailed Chinese-born Australian businessman James Peng during his Beijing trip. Peng, 36, was sentenced to 18 years in a Chinese prison last September after being convicted of embezzling about A$240,000 (US$180,000) in the southern city Shenzhen. He has insisted he was framed by powerful commercial rivals. Downer had requested that China deport Peng before the end of his scheduled term, but had been told the prisoner's sentence was a matter for the judiciary to decide, officials said. 2182 !GCAT !GPOL Indonesian opposition figurehead Megawati Sukarnoputri said on Friday she was not seeking a compromise with the government over a political row which has unsettled the nation since June. She told Reuters in an interview that Thursday's postponement of a lawsuit to allow time for an out-of-court settlement did not signal any impending rapprochement. Megawati filed the action against her ejection from the leadership of the Indonesian Democratic Party (PDI). She rejected suggestions that she was working on a compromise with authorities or her party rival Surjadi, elected to replace her at a government-supported conference in Medan, North Sumatra in June. "I took a legal route because indeed I wanted to show what was done to the PDI, including me, was a thing that challenged or opposed the law," said Megawati, the eldest daugther of Indonesia's founding president Sukarno. "I don't want to oppose the Indonesian government but with this I want all of us to come back to the principles of independence which are clearly outlined in the 1945 Constitution. What is certain, I want justice, not just a legal process which is a formality or proforma." Megawati reaffirmed her commitment to going ahead with the civil suit, which seeks to declare the government's support for the Medan congress illegal and the payment of 51 trillion rupiah ($22 billion) in damages. Central Jakarta District Court chief judge I Gde Ketut Suarta, who heard the action filed by Megawati on Thursday, said a settlement was in progress and he would give both sides one week to negotiate. The next hearing is set for August 29. "It's not something that is strange or extraordinary. It is something which is normal and standard," Megawati said, adding that seeking a settlement before the commencement of a civil suit was routine procedure. But, speaking at her home in south Jakarta, she said she would not personally be involved in any talks. She said her lawyers would consult with the legal representatives of the defendants, armed forces chief General Fiesal Tanjung, Interior Minister Yogie Memet, national police chief Lieutenant-General Dibyo Widodo, rival PDI head Surjadi and supporters of his faction. Megawati has been at the centre of a political storm since her removal from the PDI's top post, which led to some of the most severe protests in the three-decades rule of President Suharto. Riots broke out in Jakarta on July 27 after police cleared the PDI headquarters of her supporters. At least four people died and scores of buildings and vehicles were set on fire during the violence. The government has since cracked down on dissent and taken over 200 people into custody. Some have been charged with subversion, a crime punishable by death. Megawati has been questioned twice by police in connection with the riots but has not been charged. Political analysts say the government backed the move to depose Megawati because it feared she could cut into the ruling Golkar party's support in next year's parliamentary elections and perhaps stand against Suharto in the 1998 presidential elections. 2183 !GCAT !GCRIM !GDIS South Korea's supreme court on Friday reaffirmed the jail sentence for the owner of a department store that collapsed last year killing more than 500 people, a court official said. The court, rejecting the appeal of Lee Joon, confirmed an earlier appeals court sentence of 7-1/2 years. He was convicted of criminal negligence after his luxury Sampoong Department Store caved in last June in South Korea's worst peacetime disaster. The court also sentenced Lee Choong-woo, a former chief administrator of the upscale residential area where the store was located, to 10 months in jail for bribery. The store collapsed during a busy evening when it was packed with shoppers and employees. More than 1,000 people were injured. (Conversion $1 = 818 won) 2184 !GCAT !GDIP Hong Kong Financial Secretary Donald Tsang will visit Indonesia and New Zealand from August 25 to 31, the government said on Friday. In Jakarta, Tsang will meet President Suharto, Minister of Finance Mar'ie Muhammad, Minister of Foreign Affairs Ali Alatas and Minister of Trade and Industry Tungky Ariwibowo. On his New Zealand leg from August 29, Tsang will meet Prime Minister Jim Bolger, Deputy Prime Minister Don McKinnon and Minister of Finance Bill Birch. 2185 !GCAT !GDIP !GPOL !GVOTE North Korea thrust itself into the U.S. presidential campaign on Friday, warning it was ready to resume its nuclear programme and refuse to participate in peace talks if there was no support for the issues in Washington. The warnings, in a Foreign Ministry statement carried by the official Korean Central News Agency (KCNA) monitored in Tokyo, were clearly aimed at Republican Party challenger Bob Dole who has said it is time to stop coddling Stalinist North Korea. "Amid presidential election campaigning in the United States, some forces are trying to improve their image by slandering the Democratic People's Republic of Korea (DPRK)," KCNA quoted the statement as saying. The statement, without naming the Republican Party, said these forces wanted to stop the implementation of a nuclear agreement sought by the current U.S. administration which suspects Pyongyang of developing nuclear weapons. According to the United States, North Korea had acquired basic nuclear capability by the time it negotiated a 1994 accord promising Pyongyang $4.5 billion in new nuclear technology in return for freezing its atomic programme. Dole has criticised President Bill Clinton for his perceived soft stance on North Korea and a statement issued by the recent Republican Party convention in San Diego echoed this theme: "We will halt Bill Clinton's efforts to appease North Korea by rewarding treaty-breaking with American taxpayer-financed oil and nuclear reactors." "This is as good as telling the DPRK to suspend the nuclear freeze promised in the framework agreement and do anything at will," KCNA said. "To tell the truth, we have these days pondered whether our continued implementation of the agreement with the United States will be beneficial to us." The statement added that if the agreement ended in failure, "we (North Korea) will continue to develop our independent nuclear energy industry relying on our own funds, technology and raw material, free from any restriction". Referring to a U.S.-South Korea proposal that China and North Korea join them in nuclear talks, the North Korean foreign statement said: "We still have doubts about the 'four-way talks', the purpose and content of which are not clear, and we are not much interested in them." South Korea and the United States have proposed four-nation peace talks with North Korea and China to replace a truce that ended the 1950-53 Korean War. North Korea, however, has insisted on bilateral talks with the United States to seek a peace agreement, saying South Korea was not a party to the armistice agreement that ended the Korean War. "As we have declared more than once, the feasible way of achieving lasting peace and security on the Korean peninsula is to conclude a tentative agreement between the DPRK and the United States at an early date," KCNA quoted the foreign ministry statement said. "Who will win the forthcoming presidential election in the United States is not our concern. But we think those who mind others' business for their own sake deserve criticism," it added. 2186 !GCAT !GDEF !GDIP China and Britain will hold talks in September to hammer out laws governing the Chinese garrison to be deployed in Hong Kong after the British leave on July 1, 1997, officials said on Friday. The talks in Beijing will be handled by the Sino-British Joint Liaison Group (JLG), a body working out Hong Kong's sovereignty transfer. "We're going to be talking to the Chinese side about the garrison law over the next weeks," Hugh Davies, head of the British team at the JLG, told reporters. The commander of the future Chinese garrison in Hong Kong, Major-General Liu Zhenwu, who is on his second visit to the territory, told government radio that future garrison laws were to be left to the JLG to decide. The arrival of China's People's Liberation Army (PLA) is viewed with some trepidation in Hong Kong, a British colony for over a century and a half. Images of the PLA's 1989 crackdown against student democracy protesters around Tiananmen Square in Beijing remain etched in Hong Kong's collective memory. China's leaders, aware of the need to win the hearts and minds of Hong Kong people, have launched a public relations blitz to persuade them they have nothing to fear. 2187 !GCAT !GCRIM !GDEF China has drafted a bill aimed at preventing vandalism and destruction of air defence facilities, the Xinhua news agency said on Friday. "Incidents of arbitrary damage and destruction of air defence facilities have occurred in recent years," Xinhua quoted Fu Quanyou, chief of the general staff of the People's Liberation Army, as saying. "The draft was made...to prevent such incidents from happening," Xinhua said. It did not say how those who damaged air defence equipment would be punished or give details of vandalism. 2188 !GCAT !GCRIM !GDIP Philippine President Fidel Ramos asked Jordan's King Hussein on Friday to investigate the death of a Filipina maid in Amman last July. Ramos said the death of Eliza Salem, 26, had caused profound grief among her family and friends. The Philippine foreign office said last week it would investigate Salem's death after her parents disputed Jordanian reports that she fell to her death while trying to escape from her employers' apartment. "On behalf of the bereaved family of Ms Salem, may I therefore request that a full, impartial and speedy investigation of her death be conducted by appropriate Jordanian authorities," a copy of Ramos' letter to King Hussein said. Filipinos are sensitive to the plight of their overseas workers, most of them domestic servants. One of them, Sarah Balabagan, was sentenced to death by an Islamic court in the United Arab Emirates (UAE) for killing her Arab employer whom she accused of raping her. She was spared the death penalty after UAE President Sheikh Zaib bin Sultan al-Nahayan intervened. She returned home to a hero's welcome earlier this month. Another Filipina, Flor Contemplacion, was hanged in Singapore in March last year after confessing to a double murder. 2189 !GCAT !GPOL The grandson of Taiwan's Nationalist leader Chiang Kai-shek, who lost a civil war and fled to the island in 1949, bluntly told the island's ruling party on Friday where it was going wrong. "It may not be so bad if a political party is either playing money politics or engaging in a power struggle," said Chiang Hsiao-yung, a Nationalist member. "But if a party has the problems of both, it is bound to decline," Chiang was quoted by the state-funded Central News Agency as saying during a two-day Nationalist party congress. Nationalist delegates were scheduled to discuss during the congress reforms aimed at boosting the party's appeal. Chiang Hsiao-yung criticised an earlier party decision that said the time was inappropriate to consider the removal from Taiwan to China of the embalmed bodies of Chiang Kai-shek and his son, the late president Chiang Ching-kuo. "I will not accept the meeting's conclusion, neither will our family members. This matter cannot be decided by only a few people in the party," Chiang Hsiao-yung said. Chiang Hsiao-yung, who suffers from cancer of the esophagus, said he did not discuss the issue with Chinese authorities during his July visit to Beijing to seek medical advice. "Some people say moving the bodies to the mainland will give the enemy a chance to whip the bodies...but I'd rather let the enemy whip the bodies than to let our own people whip the bodies," Chiang Hsiao-yung said. The Chiang family fears the two presidents, who presided over an uncompromising autocracy on the island until Chiang Ching-kuo began democratic reforms just before his death in 1988, may not be given sufficient respect in Taiwan as the influence of the opposition grows. Many portraits and statues of the Chiangs have been removed as Taiwan has developed into a more pluralistic society. Ousted in a civil war, Chiang Kai-shek and his Nationalist government were forced to flee to Taiwan by Mao Zedong's Communist army in 1949. He died in 1975 without realising a goal of reclaiming power on the Chinese mainland. 2190 !C12 !C18 !C181 !CCAT !GCAT !GCRIM A Philippine agency pursuing assets of late president Ferdinand Marcos asked the court on Friday to nullify the sale of a 9.8 percent stake in Eastern Telecommunications Philippines Inc to Smart Communications Inc. Smart is the phone unit of Metro Pacific Corp while Eastern is 40 percent owned by London-based Cable and Wireless Plc. The Presidential Commission on Good Government (PCGG) asked the country's graft court to void the sale of 196,000 Eastern shares to Smart, court documents showed. The Eastern shares purchased by Smart for 226.7 million pesos represented the entire holdings in Eastern of Universal Molasses Corp, a company controlled by businessman Roberto Benedicto. "These shares were released from sequestration by the Philippine government under a compromise agreement signed by Benedicto and PCGG," Smart had said. But the PCGG said the "shares have been sold and conveyed to Smart by defendant Benedicto without the knowledge and approval of plaintiff (PCGG)." The government took custody of the shares on suspicion they were owned by Marcos. --Manila newsroom (632) 841-89-36, fax 817-62-67 2191 !GCAT !GVIO Cambodian Second Prime Minister Hun Sen said on Friday that exiles in Canada were out to assassinate him and he doubled the $1 million price on his head to anyone who finds out who is behind the plot. Speaking in a radio broadcast from the central province of Pursat, Hun Sen said "a meeting (of Cambodians) in Canada" wanted to kill him for $1 million in cash, adding that he wanted authorities in North America and Interpol to investigate. He said he had received a note about the alleged plot from sources in Long Beach, California. Hun Sen was addressing guests at a ceremony including U.S. Ambassador to Cambodia Kenneth Quinn. "Hun Sen's head for $1 million is a little bit cheap," he said in the broadcast. " ...I would like to declare that if it only takes $1 million to take my life, I will offer $2 million to someone who finds evidence to show who is orchestrating the attempt." The premier, a former member of the Khmer Rouge guerrilla group which ruled the country from 1975-79, has alleged numerous attempts on his life, most notably by King Norodom Sihanouk's half brother Prince Sirivudh who denied the charges but was forced into exile at the end of last year. The Khmer Rouge, now waging a low-level insurgency against the coalition government, on Friday reiterated its claims that breakaway leader Ieng Sary was seriously ill. Ieng Sary was sentenced to death in absentia in 1979 for his role in the deaths of more than one million people under Khmer Rouge rule. He broke from hardliners in the Maoist group earlier this month and has since been talking peace with the government. "Ieng Sary is seriously ill and he cannot walk as he is paralysed in half of his body and has to travel in a wheelchair," clandestine Khmer Rouge radio, monitored here on Friday, said. It said Ieng Sary, who commands the loyalty of at least two major Khmer Rouge military officers on the northwest border with Thailand, had had operations on his eyes and heart. "His wounds are not better but the traitors catch him to lead them," said the radio. The Khmer Rouge have called for his capture and execution. 2192 !GCAT !GDIP !GVIO North Korean students on Friday expressed support for two South Korean students on a hunger strike in the North by beginning a fast, state media reported. The official Korean Central News Agency (KCNA), monitored in Tokyo, said members of North Korea's youth federation and university students started a fast to express solidarity with the two students on hunger strike on the North Korean side of the border town of Panmunjon. South Koreans Ryu Se Hong and To Jong Hwa began the hunger strike on Wednesday night to press for the release of fellow students detained by South Korean authorities during a pro-unification student riot earlier in the week. About 3,200 students were arrested this week in Seoul after riot police stormed a teaching block at Yonsei University. KCNA identified the fasting North Koreans as Ho Chang Jo, chairman of the North's headquarters of the National Alliance of Youth and Students of the Country's Reunification, members of the group and representatives of universities in North Korea. 2193 !GCAT !GVIO About 200 demonstrators marched to the Japanese consulate in Hong Kong on Friday demanding that Tokyo compensate victims of the British territory's occupation during World War Two. Chanting slogans and brandishing banners and flags, they staged the demonstration ahead of the 51st anniversary of Hong Kong's liberation from Japanese occupation at the war's end. "We demand that Japan apologise publicly and make reasonable compensation to Hong Kong victims," said Ng Yat-hing, spokesman for the organizers, the Reparation Association of Hong Kong. The protesters, including children, said they want Japan to compensate women forced into sexual slavery during the war and holders of worthless wartime Japanese scrip and currency. Ng did not say how many Hong Kong women were among the estimated 200,000 "comfort women" forced to serve Japanese troops in battlefront brothels. The demonstrators waved worthless war bonds, issued in exchange for Hong Kong dollars and the required currency during the occupation. "Government of Japan. Shame on you," read some of the banners. "Japan cheated by issuing currency. It has owed us for decades," the protesters chanted. The association will organise a similar protest next Wednesday, when Japan's Foreign Minister Yukihiko Ikeda arrives for a two-day visit. The liberation of Hong Kong, a British colony which reverts to Chinese rule next year, officially falls on August 30, when the British Navy sailed into the Victoria Harbour to accept Japan's surrender. 2194 !C33 !C331 !CCAT !GCAT !GDEF Indonesia on Friday shrugged off the possible cancellation of a deal to buy F-16 aircraft from the United States, saying it could look elsewhere. "Since the beginning, President (Suharto) does not give the purchase of the aircraft a high priority," State Secretary Murdiono told reporters. "If they (the United States) plan to cancel the sale now, it will not be a problem for us. Many countries sell aircraft," he said. The New York Times quoted government sources on Wednesday as saying the Clinton administration was debating whether to delay or cancel the sale of nine F-16s to Indonesia in response to a crackdown on political dissent in the country. The nine jet fighters at issue were from a batch of 28 originally sold to Pakistan, but a U.S. congressional amendment blocked their delivery over Islamabad's nuclear policy. Murdiono said Indonesia opposed the linking of the sale to this country's domestic affairs. "We will solve the problems we are facing in our own way. We will solve political problems we have in a democratic way and according to law," he said. Riots erupted in Jakarta on July 27 after police raided the headquarters of the Indonesian Democratic Party and evicted supporters of ousted party leader Megawati Sukarnoputri, daughter of Indonesia's late founding president Sukarno. At least four people died and scores of buildings and vehicles were set on fire during the violence, the worst in the city for more than 20 years. U.S. State Department spokesman Glyn Davies said on Wednesday: "There's been no decision made on those aircraft. We are still seeking to carry out President Clinton's commitment to find an alternative buyer for the F-16s." The proceeds of a sale would be used to reimburse Pakistan. Without directly confirming the New York Times report, Davies said: "We're seriously concerned about the events that have occurred in Indonesia and we will be monitoring the situation there and considering carefully how to proceed in light of events." Davies said F-16s did not fall into the category of items that could be used to stifle internal dissent, such as crowd control equipment and small arms, whose sale would be prohibited under U.S. policy. 2195 !C13 !C31 !CCAT !GCAT !GDIP !GVIO Jordan, which has blamed Iraq for bread riots last week, has asked an Iraqi diplomat to leave, official and diplomatic sources said on Friday. The main Friday prayers in southern Jordan that were the starting point for the riots a week ago passed peacefully under tight security imposed by the army with only brief demonstrations reported. Adel Ibrahim, the Iraqi embassy's press attache, was asked to leave "because he was carrying out duties incompatible with diplomatic norms", one source told Reuters, implying he was accused of spying. Ibrahim told Reuters by telephone from his embassy office in Amman that he "had not been notified" of any explusion order. The government declined official comment. Ibrahim's assistant, Hussein Khalaf, was expelled earlier this year for similar reasons amid rising tension in bilateral ties after King Hussein began calling for change in Baghdad following top Iraqi defections in August 1995. Iraq retaliated then by expelling a junior administrator working in the Jordanian embassy in Baghdad but has continued its policy of trying to avoid public conflicts with Jordan -- its only secure route to the rest of the world. Jordan has accused Iraq and a local pro-Baghdad party for the country's worst unrest in seven years which erupted after it almost doubled the prices of bread last week under radical economic reforms agreed with the International Monetary Fund. In Karak, where two days of riots flared last Friday, a few hundred young men lingered outside Omari mosque on leaving, shouting slogans for about 15 minutes. "Disperse, abstain from forming groups and help maintain order," army officers, who has enforced a loose curfew since the riots, told the crowd through loudspeakers. The men shouted "Allahu Akbar" (God is Greatest) as a former Islamist deputy, Ahmed Kafawin, told soldiers the crowd would not cause trouble. He had earlier mounted the mosque's pulpit to demand release of detainees, an end to raids on houses and the cancelling of the bread price rises. Armoured cars had patrolled streets in Karak, traditional bastion of communist ideology and Baath socialism that swept the region in the 1950s, and guarded entrances to the hill-top city famed for its Crusader castle before the prayers. There was also heavy security in the crowded centre of Amman, where smaller clashes had erupted last Saturday, but Friday prayers at the main mosque ended quietly as police in full riot gear looked on. The Jordanian Arab Socialist Baath Party, which has one deputy in the 80-seat lower house of parliament, has denied involvement in unrest which it blamed on government policies and rising economic hardship. Government attempts to link the rioting to foreign influence has been treated with derision by those in the streets who blame the protests on severe economic hardships. 2196 !GCAT !GVIO An Iraqi Kurdish guerrilla group engaged in bloody clashes with a rival Kurd militia on Friday accused Baghdad's forces of shelling its positions in northern Iraq, the official Iranian news agency IRNA said. It quoted a radio station run by the Patriotic Union of Kurdistan (PUK) as saying Iraqi heavy artillery was pounding its positions in Kurdish-controlled northern Iraq. The radio gave no details about possible casualties, the agency added. There was no independent confirmation of the report. The rival Kurdistan Democratic Party (KDP), which accuses Iran of supporting the PUK, said on Thursday that its forces had halted an Iranian-backed attack by thousands of PUK fighters. It said around 400 PUK guerrillas were killed, wounded or taken prisoner. The PUK was not immediately available for comment. The KDP has accused neighbour Iran of laying down artillery barrages in support of the PUK and allowing it to use Iranian territory. The PUK denies backing from Tehran. Tehran has not reacted to the charges. The clashes are taking place in a Kurdish enclave protected from Baghdad by a U.S.-led air force based in southern Turkey since shortly after the 1991 Gulf War. Washington has urged the rival Kurdish parties to stop fighting and accept a U.S. invitation to peace talks in London. Northern Iraq has been split into rival Kurdish zones since fighting broke out between the two groups in 1994. Around 3,000 people died until a ceasefire was arranged in March 1995. 2197 !GCAT !GVIO Turkish troops have killed 17 Kurdish rebels in recent clashes in the southeast of the country, the state-run Anatolian news agency said on Friday. Two security officials and two state-paid village guards were killed in the fighting with Kurdistan Workers Party (PKK) guerrillas, the agency quoted the emergency rule governor's office as saying. Eight of the rebels were killed in Van province, five in Sirnak and four in Hakkari. The agency did not say when the clashes took place. More than 20,000 people have died in the PKK's 12-year-old fight for independence or autonomy in southeastern Turkey. Three people, including two village guards, died when a mine planted by PKK rebels exploded on a road in the southeast, Anatolian reported earlier. It said a taxi carrying the guards, members of a mostly Kurdish militia which fights the PKK, hit the mine in the province of Diyarbakir. 2198 !GCAT !GPOL !GWELF President Bill Clinton acted on Friday to mitigate the harsher effects and political controversy over a welfare reform law he signed one day earlier by ensuring legal immigrants do not lose food aid. The White House said Clinton had instructed Agriculture Secretary Dan Glickman to make sure that legal immigrants and their children who are eligible for food stamps do not have them cut off by mistake during the new law's implementation. At the same time, Clinton also directed Attorney General Janet Reno and other agency heads to reduce bureaucratic delays so that legal immigrants who are eligible to become citizens can do so as quickly as possible. White House spokesman Mike McCurry said Clinton thought the welfare reform bill, which ends direct federal aid to poor children, "contains provisions that will cause unfair and unwarranted harm to many families. "That is especially true of legal immigrant families, who have followed the rules, worked, and paid taxes, and who have suffered a calamity that has forced them to seek assistance," McCurry said. "The president has vowed to repair these provisions of the bill. In the meantime, however, he is determined to ensure that they are implemented carefully, and that no individuals not actually covered by these provisions are improperly denied the benefits they and their children need," McCurry said. Clinton's action just a day after signing the welfare reform bill reflected his ambivalence about the measure passed by the Republican-majority Congress, which Clinton, a Democrat, said was imperfect and marked only the beginning of welfare reform. His move may have also been intended to assauge liberal critics of the measure in his own political party just before it opens its presidential nominating convention in Chicago next week. Many of the Democratic party's leaders and its core constituencies are vehemently opposed to the new law, saying it leaves the nation's poor children in the lurch, and several top Democrats were noticably absent from Thursday's signing ceremony. Under the new law, legal immigrants have to have their eligibility for food stamps checked and "recertified" by states. In the meantime, they should continue to get the aid. Under the new law, federal welfare spending will be cut by about $55 billion over six years, mainly by reducing funding for the Food Stamps programme and aid to legal immigrants. It also imposes a five-year lifetime limit on receiving welfare and requires recipients to begin working within two years after receiving benefits. 2199 !GCAT !GDIP !GVIO The pilot of a Cuban plane hijacked to waters off Florida last week returned to his homeland on Friday, a day after the three men charged with the hijacking were indicted, U.S. officials said. A spokesman for the U.S. Attorney's office in Fort Myers, Florida, said the identity of the pilot was not being released, citing a policy of not identifying witnesses. But Cuban officials identified him as Adolfo Perez Pantoja, 47. Cuban state media said Perez flew into Havana on Thursday on a flight from Miami. On Thursday, a federal grand jury sitting in Fort Myers had released a one-count indictment against Adel Regalado Ulloa, 22, Leonardo Reyes Ramirez, 27, and Jose Roberto Bello Puente, 22, all of Havana, charging them with air piracy. On Aug. 16, 1996, an aircraft operated by Cuban Aero Taxi Service of Havana crashed into the Gulf of Mexico off Florida's west coast. Its captain and three passengers were rescued by crew members from a nearby Russian freighter. According to the indictment, the three alleged hijackers had forced the pilot after takeoff on a regularly scheduled domestic flight to steer the aircraft toward the United States by threatening him with force and violence, including assault with a deadly weapon. The three alleged hijackers had asked for political asylum after being turned over to U.S. authorities, while the pilot asked to return home. If convicted, the defendants face a mandatory minimum of 20 years imprisonment without the possibility of parole and as much as life imprisonment. They each also face a fine up to $250,000 and up to five years supervised release. The Cuban government has asked the U.S. government to honour existing immigration accords and return the alleged hijackers to Cuba. 2200 !GCAT !GDIP !GPOL !GVIO The United States said it had brokered a ceasefire on Friday to end six days of fighting between the two main Kurdish factions in northern Iraq and persuaded them to attend U.S.-mediated peace talks next month. The clashes, shattering a ceasefire negotiated last year by Washington, had threatened a U.S.-led peace plan to unite the mountainous Kurdish region against Iraqi President Saddam Hussein. State Department spokesman Glyn Davies said the new truce was agreed in direct U.S. contacts with Massoud Barzani, leader of the Kurdistan Democratic Party (KDP), and Jalal Talabani, leader of the Patriotic Union of Kurdistan (PUK). The two leaders "have agreed to cease the fighting (and) return their forces to the positions held before the current fighting began" on August 17, Davies said in a statement. He gave no specific time for the ceasefire but said Washington looked for "immediate implementation" of the deal. The party leaders had also agreed to meet U.S. Assistant Secretary of State for Near Eastern Affairs Robert Pelletreau in September "to solidify the ceasefire and to pursue reconciliation," Davies said. Another State Department spokesman, John Dinger, said that although the venue and precise date of the meeting had not been finalised, Washington expected it to be held in London, to which it had previously invited the Kurdish factions. Pelletreau had personally negotiated the ceasefire in telephone conversations on Friday with Barzani and Talabani, Dinger said. The agreement came after the KDP said on Thursday night it had repelled an attack by thousands of PUK fighters, killing, wounding or capturing about 400 opposing guerrillas. The fighting has hindered U.S. efforts to set up a workable Kurdish entity outside Baghdad's sphere of influence and has raised the specter of greater Iranian involvement. In an obvious reference to fears of Iranian interference, Davies' statement said that "outside intervention to manipulate and enflame the conflict must also end". U.S., British and French planes have been patrolling the skies of northern Iraq since shortly after the 1991 Gulf War to shield Iraq's Kurds from any attack by Iraqi troops. The operation is part of a U.S.-led effort, backed by tough economic sanctions, to keep the pressure on Saddam. The Kurds agreed early last year to end more than a year of clashes that cost some 3,000 lives. But a full peace deal, agreed to at U.S.-sponsored talks in Ireland, is in limbo. Those talks were chaired by Robert Deutsch, head of the State Department's Iran and Iraq division, and the decision to send the more senior Pelletreau this time apparently represented the increased urgency now seen by Washington. The militias have failed to implement an accord to share revenues from the KDP's makeshift oil trade on the Turkish border and demilitarize the PUK-held main city of Arbil. Bad blood between Iraq's Kurds goes back to the mid-1960s when Talabani broke with the KDP. The KDP has accused Talabani's forces of receiving military support from Iran in the current fighting. The PUK denies this and charges that Barzani's group is collaborating with Baghdad. Several thousand Iranian troops briefly entered northern Iraq last month and killed about 20 Iranian Kurdish guerrillas based there. "If Iran is not directly involved this time then it is certainly trying to increase its influence," said a Western diplomat in Ankara. 2201 !GCAT !GCRIM !GHEA Police said on Friday they were considering formal charges against Dr. Jack Kevorkian who was arrested for disorderly conduct just hours after he helped two people with multiple sclerosis to die. Police said they held Kevorkian for about two hours late on Thursday after he became abusive when officers tried to question him about the second body he brought to Pontiac Osteopathic Hospital's emergency room. Kevorkian was released but police said they were still investigating the incident to determine whether to file formal disorderly conduct charges against him. Kevorkian's attorney Geoffrey Fieger was apologetic about the retired pathologist's behaviour. "I think Dr. Kevorkian is under a lot of stress and unfortunately, I think things got a little out of hand," Fieger told reporters. "I apologised on behalf of Dr. Kevorkian. I think the officers were just interested in doing their job." In the past week, the death-on-demand advocate has stepped up his suicide activity in the wake of the controversial death of a Massachusetts woman who suffered from chronic fatigue syndrome and had lodged abuse charges against her husband. The death of Judith Curren has raised questions about the methods Kevorkian uses to screen his patients. The latest patient on Thursday night was Pat DiGangi, 66, of New York City, a former history teacher at Brooklyn College, Fieger said. He died in the presence of his wife, Ann. DiGangi suffered from multiple sclerosis, as did Patricia Smith, a 40-year-old nurse from Lee's Summit, Mo., whose body Kevorkian brough to Pontiac Osteopathic Hospital at about midday on Thursday. After dropping off DiGangi's body, Pontiac police officers tried to question him about the death. "He became pretty loud and abusive towards the officers; he was calling them Nazis, eventually pushed one of them in the chest and got to the point where he had to be arrested for being disorderly in a public place," police Sgt. Kenneth Lewis said. Smith's husband, David, became the first known police officer to actually witness the death of a Kevorkian patient on Thursday. "Her husband loved her," Fieger said. "She was more important to him than the fact that somebody might say, 'You're a police officer and this is wrong.' It's not wrong." Kevorkian was also present on Tuesday night when Louise Siebens, 76, of McKinney, Texas, took her life to relieve her suffering from amyotrophic lateral sclerosis. Known as Lou Gehrig's disease. The illness is considered terminal. 2202 !GCAT !GPOL !GWELF President Bill Clinton acted on Friday to mitigate the new welfare reform law by ensuring food aid continues to eligible legal immigrants and speeding up the process by which they become citizens, the White House said. "The president has today issued two directives to ensure that legal immigrants and their children who remain eligible for benefits under the new law do not have those benefits cut off mistakenly, and that legal immigrants who are eligible to become citizens can do so as quickly as possible," a statement by White House spokesman Mike McCurry said. Clinton signed the welfare reform on Thursday, despite protests from some of his Democratic party's core constituencies that the measure left the nation's poor children in the lurch. The law gives states more power, limits eligibility and ends direct federal aid for poor children. Clinton said while signing the measure that it was imperfect and that the process of reform was only beginning. McCurry said Clinton was concerned that "the welfare reform bill contains provisions that will cause unfair and unwarranted harm to many families," especially legal immigrant families. "The president has vowed to repair these provisions of the bill. In the meantime, however, he is determined to ensure that they are implemented carefully, and that no individuals not actually covered by these provisions are improperly denied the benefits they and their children need," McCurry said. He said Clinton had directed Agriculture Secretary Dan Glickman to ensure states have the maximum time allowed under the law to make sure legal immigrants eligible for food stamps continue to receive them. Clinton also directed Attorney General Janet Reno and other agency heads to reduce bureaucratic delays in the citizenship process. 2203 !E21 !E211 !ECAT !GCAT !GCRIM !GPOL The sales tax referendum proposed by Florida's Hillsborough County is deceptively worded and would unconstitutionally use public money to benefit a private, for-profit football team, Former Tampa Mayor William Poe told a judge Friday. Poe filed a lawsuit against Hillsborough County Elections Supervisor Pam Iorio on Aug 19 seeking to remove the proposed half-cent sales tax increase from the Sept 3 ballot. Hillsborough County Circuit Court Judge James Whittmore heard testimony Friday and said he would rule on Monday at the earliest. If approved, the sales tax increase would raise $2.7 billion over 30 years, with 12 percent of that revenue used to pay debt service on a $168 million stadium for the Tampa Bay Buccaneers. The rest of the money would fund schools, roads, libraries and public safety projects. Poe's attorney, Thomas Morrison, said Hillsborough County Commissioners had created "a wish list of projects with the stadium buried in it so the voters will buy it." "The commissioners felt a stand alone stadium tax would not fly," Morrison said. He said the tax was proposed mainly to benefit Bucs owner Malcolm Glazer and his family, who had threatened to move the team away from Tampa because unless the county built a new stadium that increased their profits. He said the ballot language does not adequately make clear the purpose of the tax, as required by state law. Hillsborough County's attorney, Emeline Acton, said the stadium was a community project because it would also be used by the Tampa Bay Mutiny soccer club, the new University of South Florida football team and would house other events. Acton said the Florida Constitution allows public money to be used to enhance private development in serving the public interest. "The pairing of public and private revenue more and more is the only way governments can make things happen," Acton said. She said the stadium proposal had received so much media attention that to claim voters would not know what they were voting on was "like saying the people of Los Angeles are not aware of the O.J. trial." Under an agreement between the city of Tampa and Hillsborough County, the Bucs' stadium would be financed with revenue bonds issued by the Tampa Sports Authority and repaid from stadium and sales tax revenues. --Miami Bureau, 305-374-5013 2204 !E41 !E411 !ECAT !GCAT !GJOB Mississippi's unemployment rate dropped to 6.3 percent in July from 7.1 percent in June and 6.6 percent a year ago, the state Employment Security Commission said Friday. "The July rate continues to indicate a vibrant economy with new jobs outpacing the loss of old ones," said Raiford Crews, state chief of labor market information. Crews said the state's civilian labor force rose by 8,800 from June to 1.28 million. Total employment rose by 10,000 and unemployment dropped by 10,300 during the month. --Jane Sutton, 305-374-5013 2205 !GCAT !GHEA !GPOL Five weeks after New York Gov. George Pataki hailed his agreement with the state Legislature to reform workers' compensation the bill remains stalled in the Assembly and the state comptroller has objected to a key provision. The state's $66 billion budget was not approved until 104 days after it was due on April 1, a new national record, and a number of the budget's approximately 900 bills have yet to be forwarded to Pataki for his signature. Still, while "100s and 100s" of bills had been enacted, the workers' compensation bill probably is one of the biggest that remains outstanding, said Michael McKeon, a spokesman for Pataki. The legislation, which Pataki considers one of the biggest achievements that his Administration won during this year's legislative session, aims to save employers as much as $1.3 billion or 25 percent of the program's yearly costs. However, the way the bill was written poses a problem for the state comptroller, H. Carl McCall, as it would prevent his office from randomly auditing payments by the State Insurance Fund before they are sent to workers who have been hurt. "There are some technical problems with the Dole v. Dow bill that the comptroller recognizes," Assembly Speaker, Sheldon Silver, D-Manhattan, recently told reporters in New York City. The term Dole v. Dow refers to a 1972 case decided by the Court of Appeals. The ruling let equipment makers who are sued by injured workers to try and collect damages from an employer if a court rules the employer played any role in setting how the device that hurt the employee was used. New York is the only state that puts employers at risk of this kind of unlimited liabilty. Approximately $300 million of the new bill's estimated savings would result from curbing the right of workers to sue third parties, such as equipment-makers, unless their injuries meet a a new definition of severity. "Specifically, (the problems involve) working out an arrangement to one of the provisions that takes away the comptrollers' right to preaudited claims," Silver said. Solving the problem is not expected to require the legislature, which adjourned for the year after it approved the budget in mid-July, to return this year to enact new language. "Our preferred approach would be to receive agreement or assurances that a chapter amendment will be enacted to rescind that portion of the bill. In the meantime, we would like (an agreement for) the unconstitutional provision to go unenforced," said a spokesman for the comptroller. While the consultations are continuing, state officials did not predict how long the process likely will take. Officials from the office of the comptroller, who is a Democrat, and the Assembly, which is controlled by Democrats, are expected to attend the party's convention in Chicago next week. The spokesman for the governor, referring to the workers' compensation bill, said "There have been some discussions going on but we expect to get it in the near future." He declined to disclose whether this was a matter of weeks or days. In addition to the workers' compensation bill, a bill that would provide $150 million in discretionary spending for legislators, who are running for office in November, also remains outstanding. Because that bill first was approved by the Senate, it is the upper house's prerogative to forward it to the governor, and the delay has prompted talk that it might be a lever that is being exerted against Silver. The House Speaker had fought against the workers' compensation bill, partly due to the changes it would make in the suits by equipment manufacturers. Spokesmen for Silver and Senate Leader Joseph Bruno, R-Troy, were not immediately available to comment on this speculation. --Joan Gralla, 212-859-1654 2206 !GCAT !GDIP !GPOL All U.S. consular posts are now issuing machine-readable visas, a move designed in part to prevent suspected terrorists from entering the United States, the State Department said on Friday. Computer software which creates and reads the visas automatically checks the applicant against a database of more than four million aliens who are potentially ineligible to enter the country, spokesman Glyn Davies said. He said the new visas, which include a computer-generated photograph of the passport holder, would also help prevent visa fraud and speed up the clearance process for people arriving in the United States. The U.S. consulate in Perth, Australia, on Friday became the last of 221 U.S. posts throughout the world to start issuing the machine-readable visas. Davies also said the State Department expected to issue a record 5.6 million passports to U.S. citizens in the fiscal year 1996. He said the figure was partly due to a record number of newly naturalised American citizens applying for their first passport. More than 40 million Americans travelled overseas last year. Davies said the passports had been issued even though government shutdowns, caused by budget disputes between Congress and President Bill Clinton, closed passport offices last winter for all except emergency issues. 2207 !GCAT !GDIS !GENV Several major wildfires in the Western United States were contained on Friday but authorities warned that lightning storms building in the parched region could spark new blazes. The National Interagency Fire Centre said firefighters contained four large fires in California, Colorado, Idaho and Nevada although one new fire was reported in California. As of Friday there were 21 large fires on 283,115 acres (114,570 hectares) in six Western states, compared with 46 large fires affecting 502,970 acres (203,500 hectares) in eight states last Sunday, the centre said. An army of 20,600 firefighters were battling the blazes across the West on Friday with support from 171 helicopters and 21 airtankers, the centre said. "The firefighters have had four good days in a row. The lines that they've been building are holding," said Ed Waldapfel, a spokesman for the fire centre. "But it looks like there are weather systems coming that are going to bring thunder storm activity. With that comes lightning. The potential for fires starting from lightning will be high." The fire centre said it was on the watch for dry lightning, particularly in central and southern Nevada as well as central Oregon. The new wildfire reported on Friday was in Riverside County in southern California but authorities there said the 548 acre (221 hectares) blaze was already 80 percent contained and was no longer a threat to the nearby community of Twin Pines. In northern California, thousands of firefighters and more than 600 soldiers continued to gain ground on the so-called Fork fire about 100 miles (160 km) north of San Francisco. The fire expanded slightly overnight to 82,000 acres (33,184 hectares), but the fire was 50 percent contained and authorities said they expected to fully contain the blaze on Saturday night. Crews continued on Friday to battle several fires burning in and near Yosemite National Park in California. The fires were scorching 21,653 acres (8,762 hectares) and were 20 percent contained. The campgrounds in the popular park have remained open. Firefighters said they fully contained a wildfire in San Luis Obispo County, midway between San Francisco and Los Angeles that consumed 106,668 acres (43,167 hectares). In southwest Utah, near Cedar City, a wildfire expanded slightly to 14,094 acres (5,703 hectares) on Friday, threatening some private properties near the blaze. Local ranchers moved an estimated 800 range cattle from the area, Utah fire officials said. In Oregon, seven wildfires were still ablaze, threatening some private lands and powerlines. But the largest fire in the state, located in the Hells Canyon National Recreation Area, was now 75 percent contained. That fire has burned nearly 59,000 acres (23,876 hectares). 2208 !GCAT !GVIO Investigators have found microscopic traces of an an explosive substance on debris from downed TWA Flight 800 but have no evidence to prove that a bomb caused the plane to crash, the top FBI investigator in the case said on Friday. "Based upon evidence to date, investigators cannot conclude whether this tragedy was the result of a criminal act," James Kallstrom, assistant FBI director, said at a media briefing. "The mere fact that there are chemical traces is just not enough." Kallstrom said the explosive traces were "of unknown origin." Investigators had told The New York Times and other newspapers earlier that traces of PETN, a chemical used in plastic explosives, were found on a piece of one of the plane's passenger seats. The Paris-bound Boeing 747 exploded and crashed into the Atlantic Ocean on July 17 just minutes after taking off from Kennedy International Airport. All 230 people on board were killed. Kallstrom said evidence so far did not prove or discount any of investigators' three leading theories -- that a bomb, a missile or mechanical failure caused the jet to crash. "Other things like scarring or pinging (on the plane's wreckage) would be the type of things we would be looking for," Kallstrom said. "We don't have the preponderance, the critical mass of information that tells us what happened." 2209 !GCAT !GENT !GOBIT Alyce King Clarke, a member of the Big Band-era singing group known for decades as the King Sisters, has died. She was 81. "She had the best voice. It was a big, rich alto voice and she was the heart of the family," her sister Donna King said Friday. Clark, who died Wednesday in North Hollywood Medical Centre of chronic bronchial asthma, was featured along with her sisters in the 1960s ABC television programme "The King Family." Born the fourth of eight children in Payson, Utah, Clarke started performing with two of her sisters during the Great Depression to increase the family's income. "We have sung for 60 years. We started in 1932 as little children. Our father was a musician," her 77-year-old sister said. The group ultimately evolved into a quartet, known as the King Sisters, which sang on major radio variety programmes in the 1930s and 1940s and was later featured on the Ed Sullivan Show. The group also earned a Grammy award for their recording of "Imagination." Last year, Capitol Records released a compact disc called "Spotlight on the King Sisters" as part of the series honouring "The Great Ladies of Song." Clarke is survived by husband Robert Clarke, three sons, five sisters, 11 grandchildren and four great grandchildren. 2210 !GCAT !GCRIM !GPRO The judge presiding over the wrongful-death civil case against O.J. Simpson was urged Friday to allow live television coverage of the upcoming trial. Judge Hiroshi Fujisaki listened to eight lawyers representing the families of murder victims Nicole Brown Simpson and Ronald Goldman, arguing why there should be a TV camera in the courtroom. The former football star's attorney, Robert Baker, was the sole dissenting voice, arguing against live television coverage. Fujisaki was expected to issue his ruling later Friday. Simpson was acquitted by a criminal court jury last October of the June 1994 murders of his ex-wife and her friend, who were viciously stabbed to death outside her luxury Brentwood townhouse. That trial received live, gavel-to-gavel TV coverage and kept America enthralled for about nine months. The families are now suing him for damages in civil court, charging that Simpson was responsible for the deaths of their loved ones. Trial is set to begin Sept. 17. Attorney Kelli Sager, representing several news organisations, told the judge, "There will be coverage of this case regardless of the court's decision. The best possible coverage is for the public to see what happens in the courtroom." Sager said that at the very least there should be a closed circuit television feed to the press room so that reporters not in court would be able to report on the proceedings. "There's not even enough room in the courtroom to accommodate all the media who want to be present," she said. Friday's hearing was so crowded with lawyers and reporters that some of the 19 attorneys present had to be seated in the jury box. Floyd Abrams, an attorney for Court TV, which provided the video feed for live coverage of the criminal case, argued, "It is very important that a public that has become cynical and suspicious about the way the (judicial) system works see the way it really works." But Baker said to argue that a camera was necessary in the courtroom for a fair trial "would belie 200 years of history." Some lawyers asked Fujisaki to modify his wide-ranging "gag" order prohibiting lawyers, witnesses and anyone else connected to the case from speaking about it in public, but Baker argued that it should stay intact. Attorney Daniel Petrocelli, representing the Goldman family, urged the judge to modify the order to allow Fred Goldman, Ronald Goldman's father, to speak publicly about the case. "My client has lost a son and this case is his last chance to get justice," he said. 2211 !GCAT !GDIS A U.S. Marine aircraft on a routine training mission with a crew of four on board crashed near Yuma on Friday, an official said. Marine spokesman Christopher Tessier said the plane went down west of the Gila mountain range in an area inaccessible to vehicles. The fate of the four-man crew was not immediately known, though the wreckage of the EA6B Prowler jet had been located from the air, he said. It was the third U.S. military plane crash in two days. A Marine reserve F/A-18 fighter attack plane crashed into the Atlantic on Thursday and the pilot was missing. Hours later an Air National Guard A-10 tankbuster crashed less than 100 miles (160 km) away and the pilot was taken to hospital. The plane that went down on Friday was visiting the Yuma Marine Corps Air Station from a Marine air station at Cherry Point, North Carolina, officials said. 2212 !GCAT !GDEF !GDIP Rejecting a demand by China, the U.S. Defense Department notified Congress on Friday of plans to sell Stinger missiles, launchers and other weapons to Taiwan. "The sale of this equipment will not affect the basic military balance in the region," the Pentagon told Congress. China had demanded the sale be cancelled. Taiwan wants to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stinger missiles, 96 Humvee vehicles and 500 rounds of .50 calibre ammunition for an estimated $420 million, the Pentagon said. The notification made no mention of China's demand that the sale be cancelled. U.S. officials said the weapons were defensive and so were permitted by agreements with China. The principal contractors are the Hughes Missile Systems Co., Boeing Missile and Space Systems Co. and AM General. 2213 !GCAT !GDIS !GWEA Hurricane Dolly spread storms across most of rain-starved Texas as it made landfall on Friday in northern Mexico, providing brief relief to areas of the state dried out by a prolonged drought. The hurricane crashed onshore near Tampico, Mexico, dumping torrential rains in northern Mexico and spreading storm bands across the Rio Grande Valley into northern Texas. In Texas, a tornado touched down south of Brownsville, damaging several homes but causing no injuries as gusty winds and heavy rains in advance of the hurricane moved onshore along the Texas-Mexico border. "We're never ones to advocate replacing one natural disaster with another, but the rains being generated right now are a great sight all across the state," said Gene Acuna, a spokesman with the Texas Department of Agriculture. Ranchers and farmers in Texas have lost an estimated $2.1 billion from the drought, and half the counties in the state are eligible for federal disaster relief because of a prolonged dry spell over the past three years. More than two inches (5 cm) of rain fell in South Padre Island on the Texas Gulf Coast, where flood warnings were posted before the storm. In the parched Rio Grande Valley, more than 1.5 inches (3.8 cm) of rain fell on the border town of Zapata. In Brownsville, rainfall ahead of the storm was measured at just over 2.5 inches (6.3 cm) in the past three days, said Don Ocker, a meteorologist with the National Weather Service. The drenching rains were a blessing to farmers preparing to plant fall crops in south Texas and the lower Rio Grande Valley, which has received barely a quarter of normal rainfall this year. But unless the storm turns north and stalls over the Rio Grande Valley, Dolly was not expected to break the severe drought that has parched sections of south Texas the past three years, meteorologists said. "This hasn't done anything for (the drought)," Ocker said. "For the long-run, we're still in trouble." 2214 !GCAT !GWEA Hurricane Dolly weakened rapidly as it moved over land in Mexico Friday and was downgraded to a tropical storm with maximum winds of 55 mph (88 kph), but threatened flash floods and mudslides in mountainous areas, the Naitonal Hurricane Center said. Tropical Storm Edouard, moving through the Atlantic Ocean, strengthened but remained far from land and was a threat only to shipping interests. At 1400 EDT/1800 GMT, the center of Tropical Storm Dolly was located at latitude 21.9 north, longitude 99.0 west, about 75 miles west-southwest of Tampico, Mexico, and was moving west-northwest at 13 mph (21 kph). A hurricane warning for coastal areas of Mexico was discontinued. Forecasters said they expected Dolly to continue weakening as it moved into the mountains, but residents were warned to be alert for torrential rains and life-threatening flash floods. The storm could dump six to 12 inches (15-30 cm) of rain on parts of Mexico, they said. Tropical Storm Edouard strengthened, and forecasters said it could become a hurricane later on Friday. At 1100, the center of Edouard was located at latitude 13.9 north, longitude 39.1 west, about 1,500 miles (2,400 km) east of the Lesser Antilles and moving west at 15 mph (24 kph). Maximum sustained winds had climbed to 70 mph (112 kph), just 5 mph (8 kph) below hurricane strength. 2215 !GCAT !GDIP !GPOL !GVOTE The United States on Friday shrugged off allegations of fraud in the landmark Bosnian election campaign, saying it believed international monitors were correcting problems. State Department spokesman Glyn Davies was speaking after the international community's high representative in Bosnia, Carl Bildt, expressed "deep disquiet" over reports of Serb manipulation of voter registration for the Sept. 14 vote. Davies said Washington was concerned about evidence of "quite glaring" malpractices, but added: "We have confidence that the OSCE has taken proper action to correct these irregularities." The Organisation for Security and Cooperation in Europe (OSCE) is supervising the election. The OSCE's Provisional Election Commission met in Sarajevo on Friday to consider whether to postpone some municipal voting in response to the alleged registration rigging but failed to reach a final decision, a spokeswoman said. Bosnians are to elect local assemblies in municipalities, Moslem-Croat and Serb parliaments, a national House of Representatives and a collective presidency. But monitors say many refugees have been actively discouraged from registering to vote in the community in which they originally lived. Davies said the United States had not "had any illusions that the elections in Bosnia are going to be perfect". But, he added, "these elections are a pre-requisite to creating the multi-ethnic government institutions which will put Bosnia on the road to a lasting peace". Bosnia's main Moslem party, the SDA, has asked the OSCE to postpone the municipal elections and has warned that if its demands are not met it will reconsider participating in them. But Davies noted that Secretary of State Warren Christopher, during a visit to Bosnia last week, had stressed that boycotting the vote would simply reduce the choice of leaders available to the Bosnian people. The United States is anxious for the elections to take place because it fears that otherwise the NATO-led peace force in Bosnia, which includes 18,000 American troops, will not be able to return home as scheduled at the end of the year. Davies meanwhile welcomed Friday's mutual recognition between Croatia and rump Yugoslavia as "a positive step toward establishing lasting stability in the Balkans". 2216 !GCAT !GDIP !GVIO Leaders of Iraq's two main Kurdish factions agreed on Friday to end six days of fighting and to attend U.S.-mediated peace talks next month, the State Department said. Spokesman Glyn Davies said in a statement that the agreement followed direct U.S. contacts with Massoud Barzani, leader of the Kurdistan Democratic Party (KDP), and Jalal Talabani, leader of the Patriotic Union of Kurdistan (PUK). Davies said the two leaders "have agreed to cease the fighting (and) return their forces to the positions held before the current fighting began" on August 17. He did not give a specific time for the ceasefire but said the United States looked forward to "immediate implementation". The two party leaders had also agreed to meet U.S. Assistant Secretary for Near Eastern Affairs Robert Pelletreau in September "to solidify the cease-fire and to pursue reconciliation", Davies said. His statement gave no venue or precise date for the meeting. The United States has already called on the Kurdish factions to hold peace talks in London. The KDP said Thursday night it had repelled an attack by thousands of PUK fighters, killing, wounding or capturing about 400 opposing guerrillas. The fighting has threatened a U.S.-led peace plan to unite the mountainous Kurdish region in northern Iraq against President Saddam Hussein. 2217 !E41 !ECAT !GCAT !GJOB Georgia's unemployment rate dipped to 4.9 percent in July from 5.0 percent in June and 5.5 percent a year ago, state Labor Commissioner David Poythress said Friday. "We expected the rate to drop somewhat in July because it went up from May to June, when students and other secondary wage earners began to look for summer work, and they found work in July," Poythress said. "While some people got Olympic-related jobs, others found work in grocery stores, retail outlets, recreational centers and amusement parks. Even though the Olympic Games are over, we don't expect to see a significant rise in the unemployment rate," Poythress said. Many Olympic workers were volunteers while others work for temporary employment agencies that have said they planned to continuing employing most workers hired for the Games, the labor commissioner said. For the metropolitan Atlanta area, the July jobless rate declined to 3.8 percent, down from four percent in June and 4.8 percent a year ago. Albany had the state's highest unemployment rate in July, 6.7 percent, while Athens had the lowest, 3.4 percent. Poythress said the state's unemployment rate had stayed below five percent, the level many economists consider to be full employment, for the past year. The state added 170,100 new jobs over the year. --Jane Sutton, 305-374-5013 2218 !E21 !E211 !ECAT !GCAT !GPOL - Ohio lawmakers will take up a bill this fall that would create a second state turnpike commission to oversee a new north-south toll road. State Rep. William Ogg, D-Portsmouth, the chief sponsor of the bill, said it would charge the new commission with building an approximately 240-mile toll road between Toledo and Portsmouth. He estimated the cost between $1 billion and $1.5 billion. The project would be financed through a mixture of federal funds available under the Intermodal Surface Transportation Efficiency Act of 1991 and toll revenue bonds sold by the new commission, he added. The idea for a new commission arose after lawmakers earlier this year passed a reform bill that among other things prohibited the current Ohio Turnpike Commission from expending toll revenues on projects outside of the existing 241-mile turnpike. That measure, which Gov. George Voinovich signed into law in July, was triggered by the commission's vote in April 1995 to hike tolls by 80 percent. "That's why I felt I had to do this because I could no longer use the Ohio Turnpike Commission," Ogg said, referring to why he introduced the bill. Ogg said that prior to the reform bill, the existing turnpike commission had done a preliminary examination of the north-south turnpike project, which is part of a proposed national highway network linking Great Lakes and Mid-Atlantic states. Ogg said he has bipartisan support for the bill. --Karen Pierog, 312-408-8647 2219 !GCAT !GVIO Four U.S. Army soldiers were injured on Friday when they walked into a minefield in South Korea, the Army said. It said a 2nd Infantry Division lieutenant and a sergeant lost several toes when the lieutenant stepped on a mine and two other soldiers suffered minor shrapnel wounds. All four were taken to a hospital in Seoul. Several South Korean airmen from a nearby Hawk missile company went into the minefield to help get the Americans out, the Army said. It said the soldiers were conducting a land navigation exercise with compasses about 12 miles (20 km) south of the demilitarized zone between North and South Korea when they inadvertently wandered into the minefield. 2220 !E51 !ECAT !GCAT !GCRIM !GDIP !GPOL The International Monetary Fund said on Friday it was assessing what more it could do to help an employee convicted of corruption and given a reduced sentence of five years in jail by a Chinese court. The Fund said while no decision had yet been taken, it could ask the court to grant an early release to Hong Yang, a Chinese national arrested while on an IMF mission to Beijing. "Management is assessing the situation in consultation with its lawyers and with Mr. Hong's family and will decide very soon on what further actions could be taken," an IMF spokesman said. These "could include a petition for early release," he said. In a rare move, a Chinese appeals court on Friday halved the 44-year-old Hong's original prison sentence to five years after he was convicted of accepting bribes totaling $12,000 in 1993, before he joined the IMF, the Xinhua news agency said. "The sentence was dealt with leniently ... and according to law," Xinhua quoted the court as saying. The court's decision followed a brief suspension of technical assistance to China by the IMF and a hurried Beijing visit by IMF Managing Director Michel Camdessus to voice concern over what he described as judicial shortcomings in the case. The detention in December of Hong, a former employee of the People's Bank of China, the country's central bank, stunned and angered IMF employees, some of whom complained bitterly that the lending agency did little to protect its people while they were away from home. IMF management was also distressed, since it had yielded to Chinese insistence that Hong, a staff member in Washington, be included in the mission to China. Camdessus, in a July statement, said Chinese authorities had maintained they did not know about the charge against Hong when they requested he join the mission staff. Hong was found guilty on June 28. Beijing sources said the original sentence was for 10 years, although statements by the IMF put it at 11 years. 2221 !GCAT !GDEF !GDIP Russia is having trouble developing three new nuclear weapons and the number of its total nuclear warheads is likely to drop to about 3,500 by 2005 whether it signs a START-2 treaty or not, a U.S. general said on Friday. "Based on what I see ... they're going to be at START-2 force levels by about the year 2005 whether they want to or not," Gen. Eugene Habiger, commander of U.S. nuclear forces, told reporters. Habinger said a U.S. defence analysis concluded that the number of Russian nuclear warheads will drop that low because the weapons were wearing out. He said a Russian arms control official said the same thing publicly in a Red Star article. Habiger said he was optimistic, therefore, that the Russian Duma would eventually ratify a second Strategic Arms Reduction Treaty limiting U.S.-Russian nuclear weapons to between 3,000 and 3,500 each by 2003. Habiger said Russia was developing four new nuclear weapons. One of them, a treaty-compliant SS-27 single-warhead intercontinental ballistic missile, was going well. "The other three are not," he said. He would not give details, but said Russian efforts to develop a new submarine-launched nuclear missile, a nuclear missile-firing submarine and nuclear cruise missile were not proceeding "as quickly as you would have seen 10 years ago." "Even if they developed those systems there wouldn't be the capability, the dollars, the resources to bring up their force structure ... that's going to just run out of shelf life or capability," he said. Habiger also said he agreed with a U.S. intelligence assessment that no rogue nation would be able to develop nuclear weapons for at least 15 years, but said the United States should spot such efforts if they come sooner. "The threat of a bolt out of the blue has been reduced significantly," he said. The general said U.S. defence planners were also watching China's nuclear development, although he said he did not consider China a nuclear threat to the United States now. "I cannot predict where they're going," Habiger said. "But I think we need to be sensitive to the fact that a country with one-fourth of the world's population and the fourth-largest economy -- we need to plug it into the equation in terms of our future planning." 2222 !GCAT !GDIP !GPOL The United States granted political asylum on Friday to Belarussian opposition leaders Zenon Poznyak and Sergei Naumchik. "It has been determined that you have established a well-founded fear of persecution were you to return to your country," the U.S. Immigration and Naturalisation Service said in letters to the two men, which they made public at a news conference. They said they hoped to bring their families to the United States. The INS said the grant of asylum was valid indefinitely and included their spouses and children. After they have lived in the United States for a year, they can apply for permanent resident status, it added. Poznyak is president of the Belarussian National Front and Naumchik is one of its spokesmen. They applied for asylum shortly after they came to the United States on July 6. At the news conference, Poznyak and Naumchik issued a statement denouncing Belarussian President Alexander Lukashenko and urging the United States and other western nations to support democracy in Belarus, which was part of the former Soviet Union. "Lukashenko is bringing about plans of the most reactionary, pro-Communist and chauvinistic circles of Russia aimed at the destruction of Belarus' nationhood," they said. "The presidential administration openly breeds hatred toward everyting Belarussian," they added. The two men said they would attend a conference of Belarussians in North America starting in Cleveland on August 31. Their bid for asylum was supported by U.S. Representative Martin Hoke, a Republican from Cleveland. 2223 !E21 !E212 !ECAT !GCAT !GPOL A steering committee has urged Texas' Katy Independent School District to call a referendum on a $139 million general obligation bond issue, the Houston Chronicle reported Friday. The district adds 1,500 students a year and will need at least six more schools by 2004. Its bond steering committee recommended using bonds to raise $75 million for new construction, $21 million for renovations and $43 million for land aquisition, architectural and engineering services and equipment. Committee Chairman Tommy Harrison said school district trustees should hold the referendum "as soon as possible." The district's last bond referendum was in 1994, when voters approved a $90 million GO issue for school construction and renovations. --U.S. Municipal Desk, 212-859-1650 2224 !GCAT !GCRIM !GENV A federal grand jury indicted six men for a conspiracy to smuggle hundreds of rare and endangered reptiles from Madagascar into the United States and Canada, officials said on Friday. The charges, handed down on Thursday, came a week after two men were arrested in connection with the arrival of 61 Madagascan tree snakes and four rare spider tortoises at Orlando International Airport. Officials believe the reptiles, discovered by U.S. Customs inspectors in luggage belonging to a man who flew to Orlando from Frankfurt, Germany, were intended for sale during a large reptile breeders show in Orlando on August 17 and 18. The most recent arrests capped off a three-year investigation of international wildlife trafficking that federal officials believe generates billions of dollars of illegal profits each year. "The indictment alleges a scheme in which a small, well-organised group of people set about to pillage the wildlife resources of Madagascar purely for their own profit," said Lois J. Schiffer, U.S. Justice Department's assistant attorney general for the natural resources division. Charged were Frank Lehmeyer, 42, of Frankfurt, Germany; Wolfgang Kloe, 33, of Rauenberg, Germany; Enrico Truant, 30, of Windsor, Ontario, Canada; Olaf Strohmann, 34, of Germany; Roland Werner, 34, of Germany; and Simon Harris, 25, of Blairgowrie, South Africa. Harris was arrested on August 13 after U.S. Customs Service inspectors in Orlando found $100,000 of reptiles in his luggage. Harris cooperated with federal investigators who later arrested Kloe, officials said. The other suspects are still being sought. The grand jury indictment alleged that after protected animals were transported from Madagascar to Europe, the suspects shipped snakes and tortoises from Europe to Canada and the United States concealed in suitcases. Payment for the smuggled animals was made by international wire transfers. Many of the smuggled animals are protected from export by a treaty called the Convention on International Trade in Endangered Species of Wild Fauna and Flora. They include the Madagascan Tree Boa, Spider tortoise and Radiated tortoise. 2225 !GCAT !GCRIM !GVIO By Gail Appleson, U.S. Law Correspondent Defence lawyers for three militant Moslems accused of plotting to bomb 12 U.S. passenger jets to punish the United States for its support of Israel rested their case on Friday. The three have been on trial in Manhattan federal court since May for their alleged plan to destroy the planes within a 48-hour period last year and kill about 4,000 passengers as they returned to the United States from the Far East. Closing arguments are scheduled to begin on Monday and the jury is expected to start deliberations on Thursday. U.S. District Judge Kevin Duffy said he would allow the jury to decide whether to meet over the Labour Day weekend. The alleged ringleader of the airline bombing scheme is Ramzi Ahmed Yousef, who will be tried again this year on charges that he masterminded the 1993 World Trade Centre bombing that killed six people and injured more than 1,000. Other defendants in the airline scheme are Abdul Hakim Murad and Wali Khan Amin Shah. The trial had moved into a crucial stage of testimony last month near the time of the explosion that destroyed TWA Flight 800 off the coast of New York, killing all 230 people aboard. Speculation that a bomb caused the explosion and reports that possible sabotage might be linked to Yousef or his associates caused Duffy to question jurors about whether they could remain fair. They said their judgment of the defendants would not be affected by the TWA explosion. Less than a week after the plane crash, a Microsoft expert walked jurors through key files taken from a laptop computer recovered from an apartment shared by Yousef and Murad. Jurors were shown schedules for Delta, Northwest and United flights bound for the United States from the Far East. After each departure time was the word "timer" followed by what appeared to be a detonation time. At the top of the file was the word "Bojinka," which prosecutors say was the name the defendants gave to the airline bombing plot. Yousef is also charged with placing a bomb on a Philippine Airlines flight from Manila to Tokyo on Dec. 11, 1994, as a trial run for the later massive explosions. The bomb exploded under the seat of a Japanese passenger, killing him and injuring 10 other people. The flight originated in Manila and Yousef allegedly left the plane during a stopover. Prosecutors alleged that he mixed the bomb in a restroom during the first leg of the flight and placed it under his seat with the timer set to detonate the bomb after the plane left for Toyko. The schedules in the laptop computer were for flights with stopovers before they reached the United States. The plot to bomb the airliners was uncovered on Jan. 6, 1995, when a fire broke out in a Manila apartment where Yousef and Murad were mixing chemicals. Philippine police found the laptop computer during their search of the apartment. 2226 !GCAT !GCRIM A knife-wielding neighbour apparently intent on sexual assault invaded a teenage slumber party on Friday, killing one girl and wounding three others, police said. At about 4 a.m. EDT (0800 GMT), a group of teenaged girls were having the overnight party in the Camelot subdivision of this eastern Virginia city, when a man entered the house, wielding a knife, threatening to sexually assault the girls. Detective Richard Black of the Chesapeake Police Department, said a neighbour, Curtis Lee White II, 19, was arrested in the attack, but had not been charged by late morning on Friday. There were apparently no adults at the party as the father of the family who lived in the house was out of town and the mother died more than a year ago, Black said. The detective said details were sketchy, but two of the teenagers were reportedly downstairs watching television when White allegedly entered the house and told the girls to take off their clothes. He said a male teenager sleeping upstairs reportedly heard the commotion and came downstairs and confronted White, who allegedly stabbed him more than once. The other teenagers also confronted the assailant and three girls, all under 18, were stabbed, one fatally. "At least two of them were sexually molested," Black said. He said all of the wounded teenagers were taken to a hospital but none of the injuries were considered life-threatening. Police said the girl who died was identified as Michelle Harper. Her age was not given. 2227 !E12 !E41 !ECAT !GCAT !GJOB A sharp increase in non-farm payrolls in the August U.S. employment report should show continued economic strength and increase fears of an interest rate hike, according to economists in a Reuters poll. On average, the 21 experts surveyed Friday forecast 238,000 new jobs were created this month, a figure that would show further pressure on the labor market on the heels of the 193,000 jobs created in July. "Anything over 200,000 is going to tighten the labor market (and) would show further upward pressure on wage inflation," said Donald Maude, chief U.S. economist at Scotia Capital Markets Inc. In addition to boosted payrolls, economists projected the unemployment rate slipped back to 5.3 percent from 5.4 percent in July and average hourly earnings grew 0.3 percent after a 0.2 percent decline in July. The survey marked a preliminary look at August payrolls ahead of the data's release by the Labor Department on September 6, two weeks from Friday. Over the past month, lower-than-expected initial jobless claims coupled with rises in retail sales and durable goods has shown demand for labor remains high, economists said. "We have a strong underlying trend, and we had the (jobless) claims data that haven't rebounded since coming down in July," explained Craig Prochaska, an economist at First Chicago Capital Markets Inc. If the experts are right, the August employment report, set for release Friday September 6, will show the rapid economic growth of the second quarter has not slowed as the third quarter progresses. "It shows an exceptionally strong labor market," said Maude. "No stronger than the second quarter, but the second quarter was exceedingly strong." The expected pickup in payrolls, hourly earnings and the workweek would intensify wage inflation anxiety. Consequently, the financial markets would begin pricing in an interest rate hike, Maude said. "I don't think the markets would discount an entire 25 basis points, but they'll start moving in that direction" as investors' inflation expectations rise, he said. A Reuters survey on Tuesday showed a majority of economists expect the Federal Reserve to tighten monetary policy at the November 13 Federal Open Market Committee meeting. Responses to the payrolls survey ranged from a low of 150,000 to a high of 350,000. Economists calling for a payrolls increase of 200,000 or less generally said such a figure would not worry the central bank. "A number like ours would keep the Fed on hold," said Cheryl Katz, senior economist at Merrill Lynch Government Securities Inc, who projected 200,000 new jobs. Respondents stressed their forecasts are preliminary and could change in the next two weks, particularly in response to weekly jobless claims and the National Association of Purchasing Management's August survey. Participating Non-Farm Unemployment Average Hourly Firm Payrolls Rate Workweek Earnings AVERAGES: +238,000 5.3 pct 34.5 hrs +0.3 pct Bank of Tokyo- +230,000 5.3 pct NA NA Mitsubishi BT Securities +225,000 5.4 pct 34.5 hrs +0.3 pct BZW Gov Sec'ties +275,000 5.4 pct NA NA CS First Boston +220,000 5.4 pct 34.4 hrs +0.2 pct Daiwa +270,000 5.3 pct NA NA Dean Witter +225,000 5.3 pct NA NA Deutsche MG +150,000 5.4 pct 34.4 hrs +0.3 pct DKB Securities +225,000 5.4 pct NA NA DLJ Securities +200,000 NA NA NA First Chicago +270,000 5.3 pct 34.6 hrs +0.4 pct I.D.E.A. Inc +350,000 5.1 pct 34.5 hrs +0.3 pct Lanston, Aubrey +225,000 NA NA NA Lehman Gov Sec +325,000 5.2 pct 34.3 hrs +0.3 pct MCM MoneyWatch +225,000 5.3 pct 34.4 hrs +0.2 pct Merrill Lynch +200,000 5.4 pct NA NA MMS Int'l +185,000 5.3 pct 34.4 hrs +0.2 pct JP Morgan +225,000 5.3 pct 34.4 hrs +0.4 pct Nomura +240,000 5.4 pct NA NA Painewebber +200,000 NA NA NA Sanwa Securities +270,000 5.4 pct NA NA Scotia Cap Mkts +275,000 5.3 pct 34.6 hrs +0.3 pct -- 212-859-1868 (c) Reuters Limited 1996 2228 !GCAT !GWEA Hurricane Dolly made landfall in Mexico on Friday with 75 mph (120 kph) winds but was expected to weaken as it moved inland, forecasters at the National Hurricane Centre said. Tropical Storm Edouard, moving through the Atlantic Ocean, strengthened but remained far from land and was a threat only to shipping interests. At 11 a.m. EDT (1500 GMT), the centre of Dolly was located at latitude 21.9 north, longitude 98.1 west, just south of Tampico, Mexico, and was moving west-northwest at 13 mph (21 kph). A hurricane warning was in effect from Veracruz north to La Pesca. "We expect it to move into the mountains and weaken, but it poses a threat of torrential rains and flash floods," Mike Hopkins, a meteorologist at the National Hurricane Centre, said. The storm was expected to dump six to 12 inches (15-30 cm) of rain on parts of Mexico. Tropical Storm Edouard strengthened, and forecasters said it could become a hurricane later on Friday. At 11 a.m. EDT (1500 GMT), the centre of Edouard was located at latitude 13.9 north, longitude 39.1 west, about 1,500 miles (2,400 km) east of the Lesser Antilles and moving west at 15 mph (24 kph). Maximum sustained winds had climbed to 70 mph (112 kph), just 5 mph (8 kph) below hurricane strength. 2229 !GCAT !GPOL !GVOTE Here are some key facts about the August 26-29 Democratic National Convention that will nominate President Bill Clinton as the party's candidate for the November 5 presidential election. Number of delegates: 4,329, chosen in primaries and caucuses in each state and U.S. territory. Number of delegates needed to nominate Clinton: 2,165. When nomination will occur: Wednesday, August 28, during a roll call of states and territories. Location: United Centre, a $175 million sports arena on Chicago's near West Side, a poverty-stricken, crime-riddled area. The arena holds more than 20,000 people. Schedule: -- Monday, August 26: Convention opens 4 p.m. CDT (2100 GMT) for afternoon session; evening session begins 7 p.m. CDT (0001 GMT), ends at 10 p.m. CDT (0300 GMT). Highlights: presentation by actor Edward James Olmos; remarks by actor Christopher Reeve. -- Tuesday, August 27: Convention activities begin 3:30 p.m. CDT (2030 GMT); evening programme begins 7 p.m. CDT (0001 GMT), ends at 10 p.m. CDT (0300 GMT). Highlights: remarks by Reverend Jesse Jackson, first lady Hillary Rodham Clinton. -- Wednesday, August 28: Convention activities begin 3:30 p.m. CDT (2030 GMT); evening programme begins 7 p.m. CDT (0001 GMT), ends at 10 p.m. CDT (0300 GMT). Highlights: Nomination of President Bill Clinton; address by Vice President Al Gore. -- Thursday, August 29: Convention activities begin 3:30 p.m. CDT (2030 GMT); evening programme begins 7 p.m. CDT (0001 GMT), convention closes at 10 p.m. CDT (0300 GMT). Highlight: Clinton accepts nomination. Convention theme: "Opportunity, responsibility and community." 2230 !GCAT !GPOL !GVOTE The 12-year-old daughter of Republican Gov. William Weld is working to stop his bid to win a U.S. Senate seat because she doesn't want to leave Massachusetts. Weld conceded his 12-year-old daughter, Franny, is "a foot soldier" for Democratic incumbent Sen. John Kerry, even though she isn't old enough to vote. Weld, speaking on WBUR-FM radio on Thursday, said he was facing a revolt from his daughter in part because she does not want to leave Cambridge, Massachusetts, and move to Washington. He also said Franny Weld's best friend, Tracy Roosevelt, might have something to do with her politics. Tracy is the great-granddaughter of Democratic former President Franklin Roosevelt, and support for Democrats runs in the family. The Roosevelts are good friends of Weld and his wife, Susan Roosevelt Weld, a descendant of former President Theodore Roosevelt, who won the presidency as a Republican. 2231 !C42 !CCAT !E41 !ECAT !GCAT !GJOB In a move to strengthen its institutional equity operations, Cantor Fitzgerald & Co said on Friday it plans to relocate four institutional salespersons from New York City headquarters to the firm's Stamford, Conn. office, next to its newly-acquired Parallax Group. The firm currently has one institutional salesperson in Stamford and 80 nationwide, most based in New York. The rapidly increasing number of institutional investors based in southern Connecticut prompted the move to provide the best service to customers, the company said. Cantor Fitzgerald & Co plans more expansion of its Stamford office in the near future including more institutional salesperson hires, it said. 2232 !GCAT !GCRIM Belgian police helped by dogs trained to find bodies excavated at two sites on Friday in their search for evidence in a child pornography scandal that has set off a Europe-wide alert for paedophile gangs. Elsewhere in the Belgian search, investigators seized between 300 and 400 video cassettes, Public Prosecutor Michel Bourlet said on television. He confirmed media reports that convicted child rapist Marc Dutroux, who is now accused of the abduction and illegal imprisonment of two girls, could be seen on some of the videos. "We started digging again today at Sars-La-Bouissiere and Marcinelles," Major Jean-Marie Boudin, spokesman for the Belgian Gendarmerie's special missing children squad, told Reuters. Marcinelles is a suburb of Charleroi where two kidnapped young girls were rescued from a makeshift dungeon in a house a week ago, while the bodies of two eight-year-old girls were found buried at a house in Sars-La-Bouissiere. Both houses were owned by Dutroux, an unemployed father of three who is supected of masterminding a child kidnapping and pornography operation. Five other people have been arrested including Dutroux's second wife Michelle Martin, charged as an accomplice. The others have been charged with abduction and illegal imprisonment of children or are suspected of criminal association. The hunt for kidnapped youngsters has now covered 11 houses, though the main focus has been on the one at Sars-La-Bouissiere in southern Belgium. The scandal prompted many Belgian politicians and campaigners to ask whether people in high positions had protected child sex traffickers. "The fact that 300 to 400 videos have been found indicates this was not a family enterprise," Marie-France Botte, a prominent campaigner against paedophilia, said on television. "It's clear that internationally -- and we put Belgium in there with other countries -- for sex trafficking in children to work...offenders have to have protection,...there must be political and financial support," Botte said. Bourlet said: "All the persons that have been identified (on the videos) will be prosecuted." He gave no numbers or names. Dutroux led police to the bodies of eight-year-old Julie Lejeune and Melissa Russo, who both starved to death, after he was arrested following the rescue of Laetitia Delhez and Sabine Dardenne from his Marcinelles house. Dutroux has told investigators that he abducted two other girls, An Marchal and Eefje Lambrecks, whose whereabouts or fate are unknown. The search for them has now crossed borders as Dutroux paid frequent visits to the Czech Republic and Slovakia. Police said a Belgian police officer visited Bratislava to talk with Slovakian detectives about An and Eefje and other disappearances. He planned to go also to Prague. At least 15 children have vanished in Belgium in the past six years. Seven have been found dead, six are still missing and two have been rescued. The discovery of the bodies of Julie and Melissa triggered national outrage. Petitions now being circulated in Belgium call for the reinstatement of the death penalty and for child sex offences never to be paroled from jail. Dutroux was freed 10 years early in 1992 for good behaviour from a 13-year sentence for multiple child rape. Bourlet described his personality as "very intelligent...very cold...very seductive." 2233 !GCAT !GCRIM !GDIP !GPOL !GVIO Riot police stormed a Paris church on Friday and seized 220 African migrants, including 10 on a 50-day-old hunger strike, to crush their protest against expulsion orders. The raid by police using batons and tear-gas on Saint-Bernard church in the heavily immigrant Goutte d'Or district sparked protests against the centre-right government, including a rally of at least 6,000 people in Paris. One opposition union said the government was preparing to fly an initial group of the Africans home early on Saturday. Most of the migrants are from Mali, Senegal and Zaire. The Saint-Bernard church bells sounded the alarm early on Friday as hundreds of helmeted police moved in, struggling with sympathisers who had surrounded the church in recent days to back the Africans' demand for residence papers. Police broke down the church's main gate and burst through a makeshift barricade of chairs and pews to remove the hunger strikers on stretchers and bundle the others, including about 70 terrified children, into vans. Police said about 50 of the 300 African protesters originally holed up in the church had slipped away before the raid. A total of about 1,500 police took part in the operation, sealing off roads in the area. The 10 hunger strikers, carried out on stretchers, were taken to hospital and the other protesters were detained. Conservative Prime Minister Alain Juppe said on Thursday that none of the Africans was legally entitled to stay but he would review each case on humanitarian grounds. His right-wing allies applauded a show of firmness against illegal immigration. On Friday night, demonstrators including leftist politicians, union leaders, human rights activists and film stars marched in Paris to urge the government to grant the protesters residence permits and soften 1993 immigration laws. "We're all children of immigrants," they chanted. Some wore stickers saying: "I'm ashamed of being French". One man burned the red, white and blue French flag. Police said 6,000 attended, organisers estimated more than 10,000. The march was headed by Socialist and Communist opposition politicians and celebrities including actresses Emmanuelle Beart and Marina Vlady, dissident French bishop Jacques Gaillot and human rights activist and cancer specialist Leon Schwartzenberg. Beart, co-star of the U.S. summer blockbuster "Mission Impossible", was at the church during the raid and accused police of profanation. Marches were organised in other cities, including Lyon, Toulouse and Rouen. Interior Minister Jean-Louis Debre said 30 to 40 percent of the protesters qualified for residence permits. Some were still under review, but others would be expelled. The Defence Ministry declined comment on reports by the Socialist CFDT union that a military plane would deport a first group of Africans from an airbase at Creil north of Paris on Saturday at 6 a.m. (0400 GMT). French TF1 television said none of the fasters needed hospital treatment. The hunger strikers had said they were surviving on sugared tea and vitamins for 50 days. Debre said there were no injuries and "no serious incident" in the storming. Police said 40 people were being held and six could be prosecuted for assaulting police. Opposition Socialist Party leader Lionel Jospin condemned the raid and said the 1993 tightening of immigration laws was injust because it made outlaws of many foreigners until then legally in France. "The style of this government is to smash things," he said. 2234 !GCAT !GDIS Five men died and one was injured when gas leaked from a refrigerator aboard a Japanese trawer off western Ireland on Friday, defence officials said. The vessel was among 40 being shadowed by the Irish navy after two trawlers were arrested on suspicion of fishing illegally inside Ireland's 200 mile "Irish Box" waters. Defence officials said an Irish navy vessel, the LE Aisling, was on its way to see if it could assist the vessel on which the accident happened but said the ship was not damaged and was making its own way to the port of Galway. They said it appeared that gas had leaked into the engine room of the trawler, which has a crew of about 30, but the leak had been stopped and there was no further risk on board. "As far as we know the leak has stopped. They shut everything down and it appears alright now," said Geoff Livingstone of the Inshore Rescue Service. The accident happened on the day that the captain of the Minato Maru, the first Japanse vessel detained inside Irish waters, was charged with illegal fishing, attempted illegal fishing and entering Irish international waters. Tsukasa Nagasawa pleaded not guilty through an interpreter when he appeared in court in Bandon after being escorted to the port of Castletownbeare in the southern region of Cork. Nagasawa was freed on bail of close to 300,000 Irish pounds ($450,000) and was ordered to return to court on November 4 for trial. The vessel will be held for 48 hours until a bond is posted, court officials said. A second Japanese ship was being escorted to Castletownbeare and its captain was expected to appear in court over the weekend to face similar charges. The incidents brought to 29 the number of vessels detained by fisheries protection vessels since Ireland clamped down on illegal fishing last year. Most have involved Spanish vessels. Tuna, which is popular in Japan, is caught on miles of lines with baited hooks left on floats in feeding waters and marked by a radio tranmsitter. The lines can be hauled in later. The Irish government has stepped up its campaign against illegal fishing by reinforcing its fisheries protection fleet and mounting air searches of its vast waters. 2235 !GCAT !GCRIM !GDIP !GPOL !GVIO Police using batons and teargas stormed a Paris church on Friday and seized 300 African migrants including 10 on a 50-day-old hunger strike, crushing their protest against expulsion orders. The Saint-Bernard church bells sounded the alarm as hundreds of helmeted police moved in, struggling with sympathisers who had surrounded the church in recent days to back the Africans' demand for residence papers. Police broke down the church's main gate and burst through a makeshift barricade of chairs and pews to remove the hunger strikers on stretchers and bundle the others, including some 100 terrified children, into vans. A total of about 1,500 police took part in the operation, sealing off roads in the heavily immigrant Goutte d'Or district. The raid was greeted with an outcry on the Left and plaudits on the Right. Prime Minister Alain Juppe said on Thursday none of the Africans was legally entitled to stay but he would review their cases individually on humanitarian grounds. On Friday evening several thousand people, from opposition politicians to film stars who have long backed the Africans, marched through central Paris to urge the government to grant the protesters' demands for residence permits. "We're all children of immigrants," they chanted. Some wore stickers saying: "I'm ashamed of being French". One man burned the red, white and blue French flag. The march was headed by celebrities including actresses Emmanuelle Beart and Marina Vlady, dissident French bishop Jacques Gaillot and human rights activist and cancer specialist Leon Schwartzenberg. Beart, co-star of the U.S. summer blockbuster "Mission Impossible", was at the church during the raid and accused police of profanation. Other marches were organised in cities including Lyon, Toulouse, Rouen and Narbonne. Interior Minister Jean-Louis Debre said 30 to 40 percent of the protesters qualified for residence permits. Some were still under review, but others would be expelled. The Defence Ministry declined to comment on reports that the military was preparing police to fly a first batch of protesters home on Saturday -- most are from Mali, Senegal and Zaire. The hunger strikers were rushed to hospital and the other protesters were detained. The immigrant support group GISTI said two of the fasters refused treatment and had joined the other protesters in detention at Vincennes outside Paris. Debre said there were no injuries and "no serious incident" in the storming. Police said 40 people were being held and six could be prosecuted for assaulting police. Police said about 50 of the Africans slipped away from the church, eluding arrest as police closed in. Opposition Socialist Party leader Lionel Jospin and Communist Party boss Robert Hue were among those who strongly condemned the government for the raid. Juppe's conservative Rally for the Republic (RPR) party praised his "courage". The fasters, who like the other protesters had been in the church since June 28, had been drinking sweet tea and taking vitamin pills, but two were said to be in a serious condition. Juppe had said France's highest administrative court, the Council of State, endorsed his view that the 300 Africans were not legally entitled to stay. But he pledged that families would not be broken up and ill individuals would not be expelled. Many of the protesters say they once had residence rights and were plunged into illegality by hardline 1993 immigration laws. Lawyers say loopholes in the laws, which also tightened conditions for citizenship, have created a legal nightmare. 2236 !GCAT !GCRIM Police using dogs trained to find bodies dug until the early hours of Friday at the house in southern Belgium where two young victims of a paedophile gang were found dead at the weekend, Belgian radio said. "The excavations at Sars-La-Buisierre continued until three o'clock in the morning (0100 GMT)...apparently without success," the radio said. It said Superintendent John Bennett, the British police officer who oversaw the excavations at the homes of Fred and Rosemary West in Britain's "House of Horrors" murders, was present at the new digging. He refused to comment. The dogs were let loose in various parts of the property, owned by convicted child rapist Marc Dutroux. All the dogs rapidly converged on one area where digging immediately started. Police did not use any of the sophisticated radar imaging equipment used by the British in the West case, and loaned to the Belgians. The radio said investigators would meet again later on Friday, and that digging was likely to resume. Belgium went into mourning on Thursday as eight-year-olds Julie Lejeune and Melissa Russo were buried after a highly emotional public service in the eastern city of Liege. Dutroux led police to the bodies at the weekend. He said the girls had starved to death early this year, some nine months after being abducted in June 1995. Police had earlier rescued two girls from another house owned by Dutroux in the southern city of Charleroi and have stepped up the search for two others -- An Marchal and Eefje Lambrecks -- who Dutroux admits kidnapping last August. The search for the girls has spread to other countries, notably the Czech Republic and Slovakia which Dutroux visited frequently. Dutroux and associate Michel Lelievre have been charged with abduction and illegal imprisonment of children. Dutroux' second wife Michelle Martin has been charged as an accomplice and Jean-Michel Nihoul with criminal association. Police arrested a fifth person, Michael Diakostavrianos, on Thursday. He is due to appear before magistrates on Tuesday. Dutroux, an unemployed father of three, owns at least six houses. Underground cells and dungeons to hold kidnapped children have been found in some of them. In total police have searched 11 houses, removing quantities of video tapes and magazines as well as childrens' clothing and a gun. Le Soir newspaper said on Thursday that some of the seized tapes showed Dutroux sexually abusing children. At least 15 children have vanished in Belgium in the past six years. Seven have been found dead, six are still missing and two have been rescued. The deaths of Julie and Melissa have triggered calls for the reeinstatement of the death penalty or at least no early release for convicted child sex offenders. Dutroux was released 10 years early in 1992 for good behaviour from a 13-year sentence for multiple child rape. There has also been a national outcry over revelations of bungling by police during their 14-month search for Julie and Melissa, with police in one region failing to pass on information about Dutroux' activities to investigators in another searching for the two girls. Justice Minister Stefaan de Clerck has admitted mistakes were made and has promised a full inquiry including the possibility of disciplinary actions. 2237 !GCAT !GDEF !GDIP Following is the text of a resolution Australia plans to present to the United Nations General Assembly on Sept. 9 to counter India's veto of a draft treaty to ban nuclear testing, negotiated at the Geneva-based Conference on Disarmament. Australia has submitted the text of the draft treaty and resolution to Secretary-General Boutros Boutros-Ghali to be circulated to all U.N. members. If the resolution is adopted, the treaty can be open for signature. ------ THE GENERAL ASSEMBLY, RECALLING its resolution 50/65 of 12 December 1995, in which the Assembly declared its readiness to resume consideration of the item "Comprehensive Nuclear Test-Ban Treaty," as necessary, before its 51st session in order to endorse the text of a Comprehensive Nuclear Test-Ban Treaty, 1. ADOPTS the Comprehensive Nuclear Test-Ban Treaty, as contained in ... (document number allocated to treaty text to be filled in); 2. REQUESTS the Secretary-General, as depositary of the treaty, to open it for signature, at United Nations headquarters, at the earliest possible date; 3. CALLS UPON all states to sign and, thereafter, according to their respective constitutional processes, to become parties to the treaty at the earliest possible date; 4. REQUESTS the Secretary-General, as depositary of the treaty, to report to the General Assembly at its 52nd session on the status of signature and ratifications of the treaty. (end text) 2238 !GCAT !GCRIM !GREL !GVIO Riot police clashed with stone-throwing protesters in Paris after the arrest of 210 Africans in a church in the capital sparked anger at France's draconian immigration laws. Police fired teargas and set up powerful searchlights to keep several thousand protesters away from the Vincennes detention centre where most of the Africans were being held overnight on Saturday. France-Info public radio said about 20 people were hurt in the clashes in Vincennes, on the eastern edge of Paris. But an Interior Ministry spokesman reported no injuries and said protesters were dispersing around midnight (2200 GMT). The arrested Africans, rounded up in a raid by police who smashed their way in to the Saint-Bernard church in central Paris on Friday morning, included 10 on the 50th day of a hunger strike against earlier expulsion orders. The Vincennes protesters, shouting slogans to urge the release of the African detainees, had been part of a peaceful protest march of at least 6,000 people in Paris, including opposition politicians, film stars and human rights activists. "Free the Sans Papiers (people without documents)" they chanted. An opposition union said the government would expel a first group of the Africans by military plane from a base at Creil north of Paris at 6 a.m. (0400 GMT) on Saturday. The Defence Ministry declined comment on the report, by the pro-Socialist CFDT union. Most of the Africans are from Mali, Senegal and Zaire. The centre-right government, backed by a court opinion that none of the Africans in the church had an automatic right to stay in France, has said about 30 or 40 percent of the protesters would qualify for residence permits. Other cases were under review and the rest would be expelled. France-Info said mothers with children rounded up in the Saint-Bernard church had been released quietly on Friday afternoon. About 300 Africans, from babies to grandmothers, had been sleeping in dismal conditions on the floor of the Saint-Bernard church since July. Police reckon 50 of the Africans slipped away before Friday's swoop by a force of 1,500 police. French President Jacques Chirac, who has not commented publicly on the Africans, was due to meet Prime Minister Alain Juppe at the president's summer retreat on the Riviera on Saturday for a weekend of talks, mainly about economic strategy. Opposition parties accused Juppe of cynically courting the anti-immigrant National Front, with an eye on 1998 general elections, and of jeopardising France's reputation as a cradle of human rights by imposing controversial 1993 immigration laws. "The laws have been badly handled and are not efficient against illegal workers," Socialist leader Lionel Jospin said. "The style of this government is to smash things." The 1993 laws have left many immigrants in a legal limbo, outlawing some who were previously living in France legally. The government defended the raid on the church, saying it had to crack down to discourage future illegal immigration. "Many people are watching what's happening in France in Bamako, Libreville or Kinshasa...France doesn't have a limitless capacity to take everyone," Integration Minister Eric Raoult said. Cooperation Minister Jacques Godfrain said he would travel to Mali in September with a development package to encourage Malians to stay at home, for instance by bolstering local agriculture such as cotton farming. 2239 !GCAT !GCRIM !GREL !GVIO Several hundred anti-government protesters, seeking the release of 210 African migrants seized in a raid on a Paris church, clashed with French riot police on Friday night, witnesses said. Police fired tear gas to keep protesters away from the Vincennes detention centre where most of the Africans, threatened with expulsion from France, were being held. France Info radio said about 20 people were injured. The protesters, shouting slogans urging the release of the detainees, had continued on to Vincennes on the eastern edge of Paris after a peaceful protest march of at least 6,000 people through the capital. An Interior Ministry official said police blocked the path of the demonstrators in a car park by the Vincennes horse race track, near the detention centre. Some demonstrators threw stones and sticks at police. The Africans, including 10 in the 50th day of a hunger strike, had been resisting expulsion orders in the refuge of the Saint-Bernard church. Early on Friday police broke their way in to end the occupation. A labour union allied with the opposition Socialist party said that the government planned to deport some of the Africans, most of whom are from Mali, on Saturday morning. 2240 !GCAT !GDIP Madeleine Albright, the U.S. ambassador to the United Nations, intends to travel to Uruguay, Chile, Bolivia, Honduras and Guatemala next week to discuss reforms Washington wants the world body to adopt in the coming year, her spokesman said. Both Chile and Honduras are members of the 15-member Security Council and diplomats expect Albright to hammer home Washington's opposition to a second term for Secretary-General Boutros Boutros-Ghali. Chile's ambassador, Juan Somavia, is particularly influential among developing countries in the United Nations since he initiated and organised a poverty summit in Copenhagen in late 1994. Honduras will be president of the Security Council in October, when most of the arrangements for electing a secretary-general have to be made. Boutros-Ghali assumed office in 1992 for a five-year term. Albright has accused the Egyptian diplomat of not initiating enough reforms to cut down the U.N. bureaucracy. Many U.N. members dispute this, saying the Clinton administration's stand is a reaction to Republican criticism of the United Nations. Washington owes more than half of the $1.9 billion U.N. debt for regular dues and peacekeeping, which has nearly bankrupted the United Nations. Albright will be in Uruguay August 28-30 to meet government officials and observe a peacekeeping exercise involving troops from Argentina, Brazil, Paraguay, Uruguay and the United States, spokesman Walter Douglas said in a statement. She goes to Santiago on August 30 to meet Chilean government officials and then to Cochabamba, Bolivia, to attend a September 3 and 4 meeting of several heads of state belonging to the Rio Group. Albright arrives in Honduras on September 5 to consult on Security Council issues with President Carlos Roberto Reina. She completes her trip on September 7 in Guatemala City where she will meet government officials and U.N. human rights envoys who have facilitated talks to end decades of civil war. 2241 !GCAT !GVIO Former Iranian president Abolhassan Banisadr said on Friday at least 60 dissidents had been killed on the orders of the Iranian government in the last 15 years and warned there would be more bloodshed. In an interview with Reuters at a secret location in Berlin on Friday evening, Banisadr said the Tehran government would continue to liquidate political opponents inside and outside the country until Western states began to act with greater resolve. "There were at least 60 people murdered by the regime since the coup against me," said Banisadr, speaking in French and seated in a small two-room apartment crowded with more than a dozen heavily armed security guards. "Yes, there will be more (assassinations) if the Western states do not act with resolve and with greater transparency against the regime," said the former president, who has lived in exile in Paris since his ouster in 1981. He criticised the United States' approach to dealing with Iran, saying economic sanctions and military threats were counterproductive. But he also condemned the European stance "because everything is done too secretly". Banisadr, 63, had just finished giving testimony for two days in a German court where five men are on trial for murdering four Iranian dissidents in a gangland-style shooting at a Berlin restaurant in 1992. Saying he was satisfied with the German court's handling of the case and the questions he answered over the last two days, Banisadr appeared relaxed. He told the court he had information from three independent sources that the 1992 execution of three Iranian Kurd leaders and their translator at the "Mykonos" restaurant was ordered by Iran's religous leader, Ayatollah Ali Khamenei. He said the execution was also approved by Iranian President Akbar Hashemi and Intelligence Minister Ali Fallahiyan. But in Tehran, Iran's top judge urged Germany to refuse to admit Banisadr's testimony, to guard its judicial reputation and avoid politicising the trial. "What is the judicial validity of a ruling that would be based, even for a few hundredths of percent, on the testimony of a deposed person who has fled this country?" Ayatollah Mohammad Yazdi asked in a mass prayer sermon. German justice authorities issued an arrest warrant against Fallahiyan in March and federal prosecutor Bruno Jost said after hearing Banisadr's testimony he would also examine the possibility of filing charges against Khamenei and Rafsanjani. "Khamenei and Rafsanjani are the ones responsible for the murders," Banisadr said. The short, soft-spoken Banisadr said he was eager to come to Berlin to testify because he is worried Germany has struck a deal with Iran to free the defendants ahead of time if they are convicted, an allegation that Bonn immediately rejected. "I have proof of this," Banisadr said. "I have to ask if (German Foreign Minister Klaus) Kinkel is the attorney for Rafsanjani." Although mostly upbeat during the 45-minute interview, Banisadr's trademark grin disappeared when recounting how he had delivered an advance warning to the murdered Iranian Kurd leaders in Germany about the threat of an attack. "They were informed about the danger, but they did not take it seriously enough," he said. "They did not take any security precautions." 2242 !GCAT !GDEF !GDIP Australia on Friday asked the U.N. General Assembly to begin debating the nuclear test-ban treaty on September 9 in an effort to keep it alive after the Geneva-based Conference on Disarmament failed to agree on the treaty's text. The expected Australian move came in a letter to Diogo Freitas do Amaral of Portugal, the current assembly president, asking him to make arrangements for a special session of the 185-member body, a move diplomats anticipated would be fraught with difficulties. The letter from Australia's U.N. ambassador Richard Butler said he would introduce a resolution on September 9, as a follow up to an earlier resolution adopted by the assembly that said the body was ready to consider a comprehensive nuclear test-ban treaty before its 50th session ended on September 17. "In Australia's view, the time to resume consideration of the item has now arrived, and we understand this view is shared by other member states," Butler said. The aim is to allow the treaty to be endorsed by an international body so it can be opened for signature. Said one legal expert: "The treaty needs to be adopted in somewhere so everyone knows there is one text and open it for signature. The General Assembly has done this many times before." Whether or not Australia's procedural ploy -- to introduce the resolution and force action on it within one week -- will work is still uncertain. The 50th session of the General Assembly ends on September 16. Supporters of the treaty fear if the measure is delayed until the 51st session, beginning on September 17, there will be ample time for dozens of amendments to unravel the text. Brazil, Chile, Egypt, Mexico, Pakistan and Peru are expected to be among the co-sponsors of the resolution along with Australia. India on Thursday refused to endorse the treaty-text, under negotiation for more than two years by the 61-nation Conference on Disarmament in Geneva. Its rules require a unanimous stance while the General Assembly can take a vote. Backed by Iran, India contended it could not give up its nuclear weapons option as long as declared nuclear arms states made no move to dispose of their arsenals. India can still however refuse to sign the treaty and keep it from going into force. About 44 countries identified by the International Atomic Energy Commission as capable of producing nuclear weapons have to sign the measure. A conference is required three years after it is open to signature to discuss further steps if it has not gone into force. Diplomats, however said, the procedures could become amazingly complicated before the Australian resolution could come to a vote. Some nations may attempt to call for a two-thirds vote by the General Assembly, which in itself could become a subject for debate. All of the five declared nuclear powers -- the United States, Russia, Britain, France and China -- support Australia's plan but will probably stay out of the public fray allowing other nations with more support among developing states to take the lead. The General Assembly, with 185 seats, has triple the membership of the Conference on Disarmament that negotiated the treaty text. "There is a large information job to be done here in New York about the treaty itself," said Britain's deputy ambassador Stephen Gomersall. 2243 !GCAT !GDIS Fire killed five crew members of a Japanese trawler in the Atlantic west of Ireland on Friday, Irish state broadcastter RTE said. It said one crew member was injured in the blaze, which apparently started after a gas explosion. Port officials in the Western Irish port of Galway could not confirm that the five men had died but said they had heard reports that five people had been injured. The stricken vessel was heading for Galway under its own power, the officials said. The vessel was among 30 being shadowed by Irish fisheries protection vessels after two trawlers were detained and escorted to port on suspicion of illegal fishing inside Ireland's territorial waters. They were stopped after long-line tuna fishing tackle was found inside the "Irish Box" -- Ireland's 200-mile territorial waters. The skipper of one vessel, the Minato Maru, was charged with illegal fishing in the southern town of Bandon on Friday and was ordered to appear in court again on November 4. A second vessesl, whose name was not known, was being escorted to the port of Castletownbeare in the southern region of Cork, officials said. 2244 !E12 !E41 !ECAT !G15 !G154 !GCAT !GJOB Italy could accept a delay in joining a single European currency if this would help boost employment, said Cesare Romiti, chairman of industrial giant Fiat. Romiti told a Catholic convention in this Adriatic resort that he was a keen supporter of the Maastricht treaty and wanted to see Italy in the first wave of nations signing up for the single Euro currency, which is due to be launched in 1999. But he added "If it would help find a solution to the problem of unemployment, Italy could accept a delay in its entry into monetary union". He said there were 18 million unemployed people in Europe. "This is a dramatic sign that the system does not work because Europe is entrenched behind a model of society that is hyperprotective and oversecure." He said the U.S. and emerging economies of eastern Asia had more liberal labour markets. -- Milan newsroom +392 66129502 2245 !C13 !C17 !C34 !CCAT !G15 !G152 !GCAT The European Commission and Germany failed on Friday to defuse a politically sensitive row over subsidies granted in the ex-communist east to car giant Volkswagen as both sides threatened to take legal action. European Competition Commissioner Karel Van Miert and German Economics Minister Guenter Rexrodt met in Brussels but could agree only to continue their efforts to find a solution. The row has worried Bonn by arousing anti-European Union sentiment in the bloc's largest member state. "I don't think you can say we were able to overcome the problems today," Van Miert told a news conference. Van Miert and Rexrodt, who just returned to work after 10-weeks off due to malaria, were obviously wide apart on the issue of aid for Volkswagen to develop plants in the state of Saxony, which struggles with a jobless rate of more than 15 percent. "As far as the specific case of Volkswagen is concerned our views differ from those of the Commission," Rexrodt said. Reflecting the controversial nature of the issue, he said there was a strong possibility that Bonn would decide to challenge the Commission in the European Court of Justice. Van Miert, who says Saxony has paid illegal aid to Volkswagen, also reiterated his threat to take the case to the Luxembourg-based court to stop the money from being used. "Today we can't say we have made enough progress -- an illegal situation still exists in our view," Van Miert said. The Commission is due to discuss the case on September 4. Meanwhile Bonn and the Commission would continue their talks to try and reach "a pragmatic settlement", Rexrodt said. "This is the begining of a discussion process that I hope will lead to an end which both sides can be happy with." The row erupted last month when Saxony state premier Kurt Biedenkopf overrode Commission objections to the size of the aid package size and paid out extra funds. Biedenkopf, a Christian Democrat (CDU) ally of Chancellor Helmut Kohl, warned that the state stood to lose thousands of jobs in the towns of Mosel and Chemnitz if it did not pay. VW had suspended plans to develop plants in the two towns after the Commission rejected 241 million marks ($161.7 million) of a total promised aid package of some 780 million. The company has threatened to relocate its investment to a lower-cost country if the subsidies are not granted in full. Van Miert reacted furiously to Saxony's defiant move, saying that the decision to pay 91 million marks in unauthorised support to VW could touch off an EU "subsidy war". "If there were no discipline it would undermine our whole aid policy which would lead to total anarchy," he said. "The German government has been asking for carte blanche, which is not acceptable." According to Brussels, Saxony paid out 142 million marks to VW after the Commission's June decision. Of this amount, it says 91 million was unauthorised. In total, Volkswagen has received at least 522 million marks from Saxony. Van Miert accepted that former east Germany would need significant aid for some time but said that if it were awarded illegally it would be a major risk to the EU's internal market. Almost six years after unification, eastern Germany still relies on annual net transfers of about 140 billion marks. Rexrodt, however, said the area's situation could not be compared with the rest of the EU. "We don't want anarchy either, we don't want each state to do what it likes, but we must insist that we are in a very special situation," Rexrodt said. The VW case was special, he said, and that was why Germany believed that special EU rules allowing aid to areas affected by the division of Germany should be applied. He was referring to article 92 paragraph 2C of the EC treaty which says that aid "granted to the economy of certain areas of the Federal Republic of Germany affected by the division in Germany, in so far as such aid is required in order to compensate for the economic disadvantages caused by that division" is permissible. 2246 !E12 !ECAT !G15 !G154 !GCAT The Bundesbank, almost unrivalled in its power to influence the course of European monetary union (EMU), seemed finally to put a stamp of approval on a single currency this week with a generous policy easing. A surprisingly large cut of 0.3 percentage point in its main money market rate to 3.0 percent smoothed currency markets and let other European central banks cut credit costs, defusing several weeks of tension about the likely success of EMU. But although it floored critics who said the German central bank was bent on undermining a single currency and underlined its growing market sensitivity, analysts cautioned against interpreting the move as a dramatic shift to a pro-Euro policy. "I would not rush to pin this up as the action of an embryo European central bank," said Alison Cottrell, senior international economist at PaineWebber in London. The benefits to EMU stemmed rather from a happy coincidence of domestic needs meshing with external factors. Analysts said the chances of the fiercely-independent Bundesbank shooting itself in the foot to bail out others remained minute. "The Bundesbank has no inflation risk at the moment which means it is allowed to look at other factors...such as the world economic environment," Cottrell said. Mathias Haffner, economist at BZW agreed. "There is certainly an international aspect to this and it at least gives a sign that the Bundesbank is not out to block EMU. "But they would not have cut rates if they had not been satisfied with M3 developments and we will have a rate rise when they think that is right, regardless of EMU," he said. The bank itself justified the easing, which slashed the repo rate to an historic low, with a slowdown in growth in its main monetary policy indicator, M3 money supply, and low inflation. The justification came as no surprise to Bundesbank watchers, long accustomed to the bank's untiring efforts to make markets understand that the German central bank must by law set price stability as its absolute priority. Yet the move, which this time acted to help Europe's EMU aims, stemmed from exactly the same motive as previous interest rate decisions which threatened to scupper the single currency project -- meeting Germany's best interests. In the summers of 1992 and 1993, the central bank presented a clear case for raising rates and keeping them high, arguing that placing Europe's anchor currency at risk would not benefit anybody in the long term. Each of those decisions drew international criticism and threw currency markets into fresh turmoil, causing economic agony for countries whose currencies were pegged to the mark. Although the Bundesbank's pursuit of price stability has by no means slackened, economists say today's Bundesbank has to some extent learned from these experiences and now has a much greater awareness of its power to influence markets. This was partly reflected in the size of Wednesday's cut -- pitched to catch markets off-guard by exceeding expectations. In a brief statement about Thursday's decision, Bundesbank president Hans Tietmeyer made no specific reference to EMU or to European currency or economic worries, saying only that the move was "fitting in the general world context". Analysts saw this as an acknowledgment that the central bank was increasingly prepared to look beyond Germany's borders, as long as the domestic situation permitted. Thomas Mayer, senior economist at Goldman Sachs, who said he believed the repo cut sent a very strong message that the Bundesbank cared about EMU, said: "The really different thing now is that they genuinely do look at other European countries and design policy accordingly." But Holger Fahrinkrug at UBS in Frankfurt said he believed that even if the repo cut was motivated by external currency market considerations, the primary motive was still the domestic need to rein in the robust mark. "The currency issue is of course linked in to EMU but I think they were just concerned from a domestic point of view about the strength of the deutschemark," he said. 2247 !GCAT !GDIP !GVIO Guatemalan government and guerrilla negotiators will travel to Norway in October for the formal signing of a ceasefire declared earlier this year, Norway's national news agency NTB said on Friday. It quoted Norwegian junior foreign minister Jan Egeland as saying the signing ceremony, a date for which had yet to be set, would take the parties another step on the long road to peace after 36 years of civil war in Guatemala. "A final formal agreement on a ceasefire in Guatemala will be signed in Norway in October," NTB quoted Egeland, who was in Guatemala for talks with the parties, as saying. "In the six years that I have been engaged in the peace process in Guatemala I have never heard the parties speaking with such agreement that things are going in the right direction," Egeland said. The rebel Guatemalan National Revolutionary Unit (URNG) has met government peace negotiators regularly since January, and both sides plan to sign a definitive peace agreement this year, The guerrillas declared a unilateral ceasefire in March and the Guatemalan army is under presidential orders to cease all counter-insurgency measures. The peace process accelerated this year with the signing of major social and economic agreements and the ceasefire. More than 100,000 people have died and tens of thousands more have disappeared in the conflict. 2248 !GCAT !GDIS !GENV Pakistani authorities called out troops and declared a state of emergency in the city of Lahore on Friday after torrential rain caused floods and at least seven deaths and six injuries, state television reported. Police said a woman and her two children were killed when their house collapsed after heavy rains in Shahadra, a suburb of Lahore, capital of the populous province of Punjab. It was not immediately clear how the other casualties had occurred. The floods knocked out power and water supplies in many parts of the city, put 15,000 telephone lines out of action, caused houses to collapse, choked drainage systems and brought transport to a standstill, the official APP news agency said. "Due to continuous rain, an emergency has been declared and the army has been called in for help," a statement by the district magistrate's office said. "Police and civil defence forces have been mobilised to rescue people and an emergency cell has been set up at the deputy commissioner's office," it said. Witnesses said many houses had crumbled and army troops were helping to evacuate residents from low-lying areas. Evacuees were given temporary accommodation in school buildings. Mosque loudspeakers broadcast prayers for the rain to stop, but few people turned up for Friday worship. A spokesman for the Flood Forecasting Bureau in Lahore said the Ravi and Chenab rivers were in exceptionally high flood at several points after heavy rain in catchment areas. "The rains in the upper and lower catchment area have not stopped for the last 36 hours," the spokesman said, adding that the department had warned all concerned government agencies. He said the Ravi, which runs past Lahore, would be in medium to high flood during the night, but was unlikely to break its banks. Life came to a near-standstill as streets turned into canals with water up to two metres (six feet) deep. Motor vehicles could not be used and only boats, horse-drawn carriages and wagons were on the streets. The Meteorological Department said 373 mm (more than 14-1/2 inches) of rain had fallen in Lahore in the past 36 hours. Pakistan receives an average of 140 mm (5-1/2 inches) during the whole of the three-month monsoon season. Officials said they could not say whether the Lahore downpour had broken records. "We are too busy to check right now, but it is certainly extraordinarily high," said one official at the department. "I've never seen anything like it in 50 years," said Tahir Mashadi, 70, stranded at home like most Lahore residents. 2249 !GCAT !GDIS Nearly three dozen Hindu pilgrims have died of exposure while trekking to a holy cave in Kashmir, Indian police said on Friday. Police in Srinagar, summer capital of Jammu and Kashmir state, said 34 devotees had died since Thursday after heavy rain and snow stranded some 70,000 pilgrims on the route to the 3,880 metre (12,725-ft) high cave. A further 12 pilgrims had died earlier on the annual pilgrimage, which started on August 16 and ends next Wednesday. Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu god Shiva. Movement along the route came to a standstill as 50 cm (20 in) of rain fell over 24 hours beginning on Thursday, officials said. The temperature in Pahalgam, the last staging point along the pilgrims' route some 100 km (60 miles) south of Srinagar, had fallen to freezing, they said. The trek snakes past Pahalgam, through the Lidder valley and 48 km (30 miles) through the mountains to the cave. "People walking through the forests of Pahalgam have been exposed to extreme cold," a police official said. "It is raining heavily along the route. All the roads to Pahalgam are flooded. There are snowfalls in the upper reaches of the mountains." Last year the pilgrimage was threatened by Moslem separatist guerrillas, who staged two bomb attacks on the heavily guarded pilgrims, who rely on ponies to climb the upper reaches. A state civil servant was killed in one of the blasts. Some 20,000 people have died since a separatist revolt broke out in 1990 in Jammu and Kashmir, mainly-Hindu India's only Moslem majority state. This year guerrillas issued no ban on the pilgrimage. Instead, the weather has posed a challenge. At some points along the route, the snow was 13 inches thick, officials said. In the state's winter capital Jammu, authorities said floods and landslides set off by torrential rains had forced them to close the 300-km (185-mile) highway to Srinagar. "It will take more than three days to clear the landslides and only after that can normal traffic be restored," said Mohammed Shafi Wani, a senior police official. The flooding disrupted the traditional procession of the "charri mubarak", or the maces that symbolise Lord Shiva and his consort Parvati. They are taken from Jammu each year by road to Srinagar as part of the trek. State officials said they were arranging to have the maces flown to Srinagar. 2250 !GCAT !GDIS !GENV Pakistani authorities called out troops and declared a state of emergency in the city of Lahore on Friday after torrential rain caused floods and at least three deaths. Police said a woman and her two children were killed when their house collapsed after heavy rains in Shahadra, a suburb of Lahore, capital of the populous province of Punjab. "Due to continuous rain, an emergency has been declared and the army has been called in for help," a statement by the district magistrate's office said. "Police and civil defence forces have been mobilised to rescue people and an emergency cell has been set up at the deputy commissioner's office," it said. Witnesses said many houses had collapsed in Lahore and army troops were helping to evacuate residents from low-lying areas. A spokesman for the Flood Forecasting Bureau in Lahore said the Ravi and Chenab rivers were in exceptionally high flood at several points after heavy rain in catchment areas. "The rains in the upper and lower catchment area have not stopped for the last 36 hours," the spokesman said, adding that the department had warned all concerned government agencies. He said the Ravi, which runs past Lahore, would be in medium to high flood during the night, but was unlikely to break its banks. In Lahore, life came to a near-standstill after torrential rain left water up to one metre (three feet) deep. Motor vehicles could not be used and only horse-drawn carriages and wagons were on the streets. The Meteorological Department said 373 mm (more than 14-1/2 inches) of rain had fallen in Lahore in the past 36 hours. Pakistan receives an average of 140 mm (5-1/2 inches) during the whole of the three-month monsoon season. Officials said they could not say whether the Lahore downpour had broken records. "We are too busy to check right now, but it is certainly extraordinarily high," said one official at the department. "I've never seen anything like it in 50 years," said Tahir Mashadi, 70, stranded at home like most Lahore residents. Last year floods inundated parts of Pakistan, damaging thousands of houses, destroying crops and killing cattle. 2251 !GCAT !GPRO Mother Teresa's heart weakened on Friday and she was found to have malaria as authorities expressed concern about the Nobel Peace Prize winner's deteriorating health. "We are now worried," said an official at the hospital where the 85-year-old Roman Catholic missionary has been under treatment since Tuesday. "Her cardiac status is unstable and is closely monitored by a team of doctors," said Dr A.K. Bardhan, one of a team of physicians treating the Albanian-born missionary, regarded by many as a living saint for her devotion to the poor. Bardhan said a parasite, P. vivax, which causes malaria, had been found in her blood. Mother Teresa suffered from malaria in 1993. An official at Woodlands Nursing Home, a hospital in the eastern Indian city of Calcutta where the nun has been under treatment since Tuesday, said "her condition has deteriorated since the morning". Bardhan said Mother Teresa, who turns 86 next Tuesday, was conscious but under sedative and speaking only rarely. She remained on a respirator in intensive care, he said. Mother Teresa was admitted to Woodlands on Tuesday with a temperature of 103 Fahrenheit (39.4 Celsius) and severe vomiting. She developed heart problems on Wednesday, but had responded to treatment and was in stable condition until Friday morning. While the vomiting had stopped, Mother Teresa continued to run a fever on Friday, Bardhan said. A five-member team of specialists was formed on Thursday to monitor Mother Teresa's condition. An Indian heart specialist, Dr J.C. Ghosh, was added to the team on Friday, Bardhan said. Dozens of nuns gathered in Calcutta for round-the-clock prayers for Mother Teresa's recovery. "Please pray for the Mother," was written on a blackboard outside the main prayer hall of the Missionaries of Charity, Mother Teresa's 47-year-old religious order which is housed in a sprawling complex in the heart of India's most teeming city. Wearing white gowns, members of the order knelt on the floor, offering silent prayers for Mother Teresa, one of the world's most widely recognisable figures. "This is a special prayer. We have been having it in groups since yesterday," Sister Christene told Reuters. A large group of nuns gathered outside the chamber of Sister Priscilla, a senior member of the order who was in touch with hospital officials. "She has been handling queries from abroad the whole morning," an assistant said. A group of slum dwellers gathered at the gates for news about Mother Teresa. Known as the Saint of the Gutters, Mother Teresa won the Nobel Peace Prize in 1979 for her work with the world's destitute. In 1949 she founded a network of missions for the poor and the sick in Calcutta. Now, the Missionaries of Charity order has nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities. Mother Teresa's health began to deteriorate in 1989 when she was fitted with a pacemaker. In 1991, she was treated at a California hospital for heart disease and bacterial pneumonia. 2252 !C21 !CCAT !GCAT !GWEA !M14 !M141 !MCAT SUMMARY- Showers 0.25-1.30 inch (6-33 mm) and locally heavier through much of India, 75 percent coverage. Isolated showers 0.20-0.70 inch (5-18 mm) in the north. Highs 82-96F (28-36C). CROP IMPACT- Conditions remain favorable for the development of rice in the region. FORECAST- TODAY...Showers and rain 0.25-1.00 inch (6-25 mm) and locally heavier through most of central and south central India, up to 0.75 inch (19 mm) in 75 percent of north central India, and only isolated up to 0.50 inch (13 mm) elsewhere over India. Highs 82-96F (28-36C). TONIGHT...Variable clouds in southern India with showers. Partly cloudy in northern India with a few light showers. Lows 68-76F (20-24C). TOMORROW...Little change from today's weather expected. OUTLOOK...Numerous to scattered showers and thunderstorms in southern and central India, and isolated showers to the north Sunday through Tuesday. Temperatures near normal. Source: Weather Services Corporation 2253 !GCAT Following are some of the main stories in Friday's Pakistani newspapers. DAWN - A foreign office spokesman said that Pakistan would not accept the Biharis stranded in Bangladesh and denied that it had agreed to take them back. - The United States has not yet decided to sell the nine Pakistani F-16 jet fighters to Indonesia, the State Department said on Wednesday, amid reports that the administration was considering cancelling the deal. - The International Monetary Fund (IMF) has no complaints against the 1996/97 (July-June) budget, the prime minister's adviser on finance and economic affairs V.A. Jaffery said. - Former senator Yousuf Shaheen, who was arrested at his office in Karachi on Wednesday, has been charged with drawing 60 million rupees fraudulently from United Bank Limited. - The Privatisation Commission will shortly launch an "aggressive" marketing campaign before formally offering a 26 percent management stake in Pakistan Telecommunication Co Ltd. - The army's Burn Hall College, Abbottabad, one of the most presitigious educational institutions of the country, was ransacked by students on Wednesday night to protest against the expulsion of three students from the college. - Pakistan's four state-owned commercial banks and two specialised banks offered the lowest average of 11.6 percent rate of return on one-year deposits out of the 44 commercial banks operating in the country. - Heavy rain badly disrupted normal life in Lahore and several other cities in Punjab province. BUSINESS RECORDER - The government has offered withholding tax exemption for General Sales Tax (GST) payers and the payment of interest if the GST refund is delayed beyond 30 days. - A foreign office spokesman said there was no adverse reaction from abroad on the signing of $1.2 billion oil refinery agreement between Pakistan and Iran. - The government has prepared a plan for palm oil cultivation on a total of 2.8 million hectares. THE NEWS - Pakistan, striving to cut its budget deficit and shore up its balance of payments, has made a shaky start to fiscal 1996/97 (July-June), a former commerce minister said. - The rebel Taleban Islamic militia has captured a pro-government military base in the eastern Afghan province of Paktia, a Pakistan-based Afghan news service said. - The first arms shipment from the United States to Pakistan after a gap of six years is expected to reach Karachi on Monday. -- Islamabad newsroom 9251-274757 2254 !GCAT !GVIO The rebel Islamic Taleban militia said it had attacked a key military base of Afghan Prime Minister Gulbuddin Hekmatyar's Hezb-i-Islami party on Friday in the eastern province of Paktiya. A Taleban spokesman, Maulvi Ahmad Jan, told the Pakistan-based Afghan Islamic Press agency that 800 to 1,000 Islamic warriors, backed by artillery, had been thrown into a three-pronged assault on Spina Shega, on the Pakistani border. He said Spina Shega, used as a main supply depot for Afghan guerrillas during the fight against Soviet troops in the 1980s, was Hezb-i-Islami's last and biggest position in the province. Jan said the Taleban had earlier seized several other posts and large quantities of ammunition from Hezb-i-Islami in the Jaji district of Paktiya. There was no independent account of the fighting and Hezb-i-Islami officials could not be reached for comment. Hekmatyar, once a main opponent of Afghan President Burhanuddin Rabbani, rejoined the Kabul government in June as prime minister after a peace pact between the two men. The Taleban movement has sworn to oust Rabbani and install a purist Islamic order throughout Afghanistan. 2255 !GCAT !GPRO Mother Teresa, who is being treated in a Calcutta hospital for a heart condition and malaria, showed slight signs of improvement on Friday but her cardiac status remained unstable for most of the day, a member of her religious order said. "She is now responding to treatment, her temperature is going down," the sister of the Missionaries of Charity said at Woodlands Nursing Home where the world's most famous Roman Catholic nun remained on a respirator in intensive care two days after suffering heart failure. The sister, who requested anynomity, said the condition of the Nobel peace laureate, who turns 86 next Tuesday, had improved slightly from earlier in the day. "We will continue to keep our fingers crossed as long as she takes respiratory support," Dr A.K. Bardhan, head of a six-doctor panel attending her, told Reuters. An official at the hospital had earlier told Reuters after the initial signs of deterioration that "we are now worried". Mother Teresa's heart, which has a pacemaker, had weakened on Friday when doctors administered medicine for a recurrence of malaria, which she first contracted in 1993. She remained conscious throughout Friday but was unable to speak. "She mumbled something when the Bishop of Calcutta came to visit her," a nurse said, adding that she also recognised West Bengal's Marxist chief minister, Jyoti Basu, when he came to visit her in the afternoon. Mother Teresa, known as a living saint for her work for the destitute and poor, was admitted to Woodlands on Tuesday with a temperature of 103 Fahrendheit (39.4 Celcius) and severe vomiting. She developed heart problems on Wednesday, but had responded to treatment and was in stable condition until Friday morning. While the vomiting had stopped, Mother Teresa continued to run a fever on Friday, Bardhan said. Dozens of nuns gathered in Calcutta for round-the-clock prayers for Mother Teresa's recovery. The message "Please pray for the Mother" was written on a blackboard outside the main prayer hall of The Missionaries of Charity, the apex organisation housed in a sprawling complex in the heart of Calcutta. Members of the Charity, wearing white gowns, were seen kneeling on the floor, offering silent prayers. "This is a special prayer, we have been having it in groups since yesterday," Sister Christene, a member in the Missionaries of Charity order, told Reuters. A constant cluster of people could be seen outside the chamber of Sister Priscilla, a senior member of the order, who was keeping in touch with hospital officials. "We know the doctors are trying hard. It is all in God's hands. We can only pray," said Sister Pricilla, spokeswoman and a senior memnber of Mother Teresa's order, who spent most of her day handling queries from abroad. Sister Christene said they were told various churches worldwide were offering prayers for Mother Teresa's recovery. Outside the gates of the order, a group of slum dwellers, the main beneficiaries of Mother Teresa's work, gathered for the latest news of her condition. 2256 !GCAT !GCRIM !GDIP !GVIO Sri Lanka said on Friday the United States had promised to stamp out any illegal activities on U.S. soil directed against the island's government. The Sri Lankan foreign ministry said in a statement: "The United States government sympathised with the current predicament Sri Lanka was facing." The statement said the U.S. government "would do all within its prevailing legal framework to prevent the use of American soil to perpetrate violence against the democratic government of Sri Lanka". It said the U.S. State Department's coordinator for counter terrorism, Philip Wilcox, had expressed Washington's support for the government when he visited Colombo this week. Colombo has said it believes Tamil rebels, fighting a 13-year war for independence against the government, finance their military activity through funds extorted from expatriate Sri Lankans in western countries such as the United States. U.S. embassy officials in Colombo were not immediately available to comment on the report. Colombo estimates more than 50,000 people have been killed in the war between government forces and the Liberation Tigers of Tamil Eelam rebels in the island's north and east. 2257 !GCAT !GDIS Two dozen Hindu pilgrims have died of exposure while trekking to a holy cave in Kashmir, Indian police said on Friday. Police in Srinagar, summer capital of Jammu and Kashmir state, said 24 devotees had died since Thursday after heavy rain and snow stranded some 70,000 pilgrims on the route to the 3,880 metre (12,725-ft) high cave. A further 12 pilgrims had died earlier on the annual pilgrimage, which started on August 16 and ends next Wednesday. Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu god Shiva. Movement along the route came to a standstill as 50 cm (20 in) of rain fell over 24 hours beginning on Thursday, officials said. The temperature in Pahalgam, the last staging point along the pilgrims' route some 100 km (60 miles) south of Srinagar, had fallen to freezing, they said. The trek snakes past Pahalgam, through the Lidder valley and 48 km (30 miles) through the mountains to the cave. "People walking through the forests of Pahalgam have been exposed to extreme cold," a police official said. "It is raining heavily along the route. All the roads to Pahalgam are flooded. There are snowfalls in the upper reaches of the mountains." Last year the pilgrimage was threatened by Moslem separatist guerrillas, who staged two bomb attacks on the heavily guarded pilgrims, who rely on ponies to climb the upper reaches. A state civil servant was killed in one of the blasts. Some 20,000 people have died since a separatist revolt broke out in 1990 in Jammu and Kashmir, mainly-Hindu India's only Moslem majority state. This year guerrillas issued no ban on the pilgrimage. Instead, the weather has posed a challenge. In the state's winter capital Jammu, authorities said floods and landslides set off by torrential rains had forced them to close the 300-km (185-mile) highway to Srinagar. "It will take more than three days to clear the landslides and only after that can normal traffic be restored," said Mohammed Shafi Wani, a senior police official. The flooding disrupted the traditional procession of the "charri mubarak", or the maces that symbolise Lord Shiva and his consort Parvati. They are taken from Jammu each year by road to Srinagar as part of the trek. State officials said they were arranging to have the maces flown to Srinagar. 2258 !GCAT !GPRO Mother Teresa's health has deteriorated and the ailing Nobel Peace Prize winner now has malaria, one of the doctors treating her said on Friday. "Her cardiac status is unstable and is closely monitored by a team of doctors," said Dr A.K. Bardhan, one of a team of physicians caring for the 85-year-old Roman Catholic missionary. Bhardhan said a parasite, P. vivax, which causes malaria, had been found in her blood. Mother Teresa suffered with malaria in 1993. An official at Woodlands Nursing Home, a hospital in the eastern Indian city of Calcutta where Mother Teresa has been under treatment since Tuesday, said "her condition has deteriorated since the morning". Bardhan said Mother Teresa was conscious but continued to have a fever and was on a respirator in the intensive care unit. Mother Teresa, regarded by many as a living saint for her devotion to the world's destitute, was admitted to Woodlands on Tuesday with a temperature of 103 degrees Fahrenheit (39.4 degrees Celsius) and severe vomiting. She developed heart problems on Wednesday, but had responded to treatment and was in stable condition until Friday morning. A five-member team of specialists was formed on Thursday to monitor Mother Teresa's condition. Arguably the best known Roman Catholic missionary and one of the world's most widely recognised figures, Mother Teresa, who is of Albanian descent, turns 86 on Tuesday. In 1949 she founded a network of missions for the poor and the sick in Calcutta, India's most densely populated city. Now, the Missionaries of Charity order has nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities. Her health began to deteriorate in 1989 when she was fitted with the pacemaker. In 1991, she was treated at a California hospital for heart disease and bacterial pneumonia. In Rome in May 1993, she fell, breaking three ribs. In August the same year, while in New Delhi to receive an award, she developed malaria, complicated by her heart and lung problems. The mosquito-borne disease thrives in hot, humid climates. 2259 !GCAT !GPRO Mother Teresa's health has deteriorated and she has malaria, a doctor said on Friday. "Her cardiac status is unstable and is closely monitored by a team of doctors," said Dr A.K. Bardhan, one of a team of physicians attending to the Nobel Peace Prize winner. He said the malarial parasite P. vivax had been found in her blood. An official at Woodlands Nursing Home where the 85-year-old Roman Catholic missionary has been under treatment since Tuesday said "her condition has deteriorated since the morning". Bardhan said Mother Teresa was conscious but continued to have a fever and was on a respirator. Mother Teresa, regarded by many as a living saint for her devotion to the world's destitute, was admitted to Woodlands, which is a hospital in the eastern Indian city of Calcutta, on Tuesday with high fever. She developed heart problems on Wednesday, but had responded to treatment and was in stable condition until Friday morning. 2260 !GCAT !GDIS !GWEA Pakistani authorities issued flood warnings for Punjab province on Friday as heavy rain virtually paralysed the provincial capital Lahore. A spokesman for the Flood Forecasting Bureau in Lahore said the Ravi and Chenab rivers were in exceptionally high flood at several points after heavy rain in catchment areas. "The rains in the upper and lower catchment area have not stopped for the last 36 hours," the spokesman said, adding that the department had warned all concerned government agencies. In Lahore, witnesses said life had come to a near-standstill after heavy rain left water up to one metre (three feet) deep. Motor vehicles could not be used and only horse-drawn carriages and wagons were on the streets. The Meteorological Department said 164 mm (almost 6-1/2 inches) of rain had fallen in Lahore in the past 24 hours. This means the city received more rain in a single day than Pakistan's average rainfall of 140 mm (5-1/2 inches) during the whole of the three-month monsoon season. Officials said they were checking whether this had broken previous records. "I've never seen anything like it in 50 years," said Tahir Mashadi, 70, stranded at home like most Lahore residents. There were no immediate reports of any casualties or damage. Last year floods inundated parts of Pakistan, damaging thousands of houses, destroying crops and killing cattle. 2261 !GCAT !GDIP King Birendra left Nepal on Friday for a week-long visit to China, his eighth since ascending the throne in 1972, officials said. The constitutional monarch, who last visited China in 1993, was scheduled to meet Chinese President Jiang Zemin and Premier Li Peng during his visit, they said. Foreign ministry officials gave no details of the issues the king, who was accompanied by Foreign Minister Prakash Chandra Lohani, would discuss with Chinese leaders. The Himalayan kingdom, sandwiched between China and India, has traditionally sought to maintain close cooperation with its giant neighbours, and an equal distance from the two. The 50-year old monarch was accompanied by Queen Aishwarya on a flight to the Tibetan capital of Lhasa. The king will visit Chongqing before arriving in the Chinese capital, Beijing, early next week, officials said. 2262 !GCAT !GPRO Mother Teresa remained on a respirator in the intensive care unit of an Indian nursing home on Friday after suffering heart failure earlier in the week, officials said. An official at Woodlands Nursing Home in the eastern city of Calcutta said no fresh health bulletin had been issued since late on Thursday when a team of specialists monitoring the Nobel Prize winner's condition said she was conscious and stable. But the official confirmed that Mother Teresa, regarded by many as a living saint for her devotion to the world's destitute, still needed respiratory support. The 85-year-old Roman Catholic missionary, who won the Nobel Peace Prize in 1979, was admitted to the nursing home on Tuesday with a temperature of 103 degrees Fahrenheit (39.4 degrees Celsius) and severe vomiting. On Wednesday she developed cardio-respiratory complications which Dr A.K. Bardhan, one of her attending physicians, described as heart failure. He said Mother Teresa, fitted with a heart pacemaker in 1989, had suffered heart failure in the past and responded to treatment. This time, too, her heart problems "were handled and corrected quickly", Bardhan said on Thursday. Arguably the best known Roman Catholic missionary and one of the world's most widely recognised figures, Mother Teresa of Albanian descent turns 86 on Tuesday. In 1949 she founded a network of missions for the poor and the sick in Calcutta, India's most densely populated city. The Missionaries of Charity order now has nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities. Her health began to deteriorate in 1989 when she was fitted with the pacemaker. In 1991, she was treated at a California hospital for heart disease and bacterial pneumonia. In Rome in May 1993, she fell, breaking three ribs. In August the same year, while in New Delhi to receive an award, she developed malaria, complicated by her heart and lung problems. A Calcutta newspaper said Mother Teresa's persistent fever could indicate she had again contracted malaria, a mosquito-borne disease which thrives in hot, humid climates. But the nursing home official said doctors had not indicated she had malaria. 2263 !GCAT !GCRIM Nepali police said on Friday they arrested a man who allegedly kept a child servant bound in chains so that he would not run away when his employer was out to work. Madhusudan Munakarmi was arrested on Thursday after his neighbours informed police about the plight of 12-year old Dhiraj K.C., who told police his employer used to tie him up with iron chains and locks concealed under his clothes. The neighbours in Kathmandu called the police when they saw Dheeraj, employed by the man for the past nine months, limping because of the chains. "I feared he would flee from work or steal my belongings," the Kathmandu Post newspaper quoted Munakarmi as saying after his arrest. If convicted, he faces a maximum of three years in jail under Nepal's child protection laws. 2264 !GCAT !GDEF !GDIS Bangladesh Flight Lieutenant Rahmatul Bari was killed when his F-6 aircraft crashed into the Bay of Bengal during a training flight on Wednesday, defence sources said on Friday. They said the aircraft crashed few minutes after it took off from Chittagong air base and a joint rescue operation by airforce and navy was continuing. Newspapers on Friday quoted fishermen at sea as saying that they had seen an aircraft nose-diving into the water in stormy weather. No other details were available. 2265 !E51 !ECAT !GCAT !GDIP The U.S. Agriculture Department said Thursday it would donate $1.2 million worth of U.S. farm goods to the volunteer organization, Lishkas Ezras Achim, to distribute to the needy in Moldova. USDA said the donated commmodities will include 1,000 tonnes of vegetable oil, 700 tonnes of rice and 300 tones of wheat flour. The donation was made under USDA's Food for Progress program. The supply period is fiscal year 1996. REUTER 2266 !C13 !C15 !C152 !C31 !CCAT !GCAT !GHEA It's a routine day at the press ministry as reporters light up greeting the government spokesman with a thick cloud of smoke. Welcome to Marlboro country. Greece leads in per capita cigarette consumption followed by Japan, Poland, Switzerland and South Korea, according to the Economist. On average, Greek smokers puff away over 2,700 cigarettes a year and they are not about to quit. "Greeks are avid smokers. They enjoy smoking just like their cup of thick Greek coffee and island sunsets. The hope now is for the younger generations... to never pick up the habit," says businesswoman Yianna Tsirimonaki, exhaling. And while there's talk that the domestic market is hitting a peak, major tobacco companies like Papastratos are looking to neighbouring Balkan markets where smokers, thirsty for Western brands, are still wondering what the fuss is all about. Tsirimonaki who does business in the Balkans thinks all underdeveloped countries are Marlboro countries with advertising there playing a major role. "Kids usually start with Marlboros then try Camels," she says. Increasingly, as health fears, restrictions on smoking in public and high taxation are hurting tobacco markets in the West, big manufacturers are heading East in a shift away from the developed countries. While former tobacco bulls are growing wary on Western tobacco stocks, strong growth prospects in the Balkans and Eastern Europe are prompting buy recommendations by investment analysts. "We view Papastratos as one of the most attractive vehicles through which to gain exposure to Greece and the rapidly developing Balkan, primarily Romania and Bulgaria, and Eastern European markets," says Salomon Brothers in its buy rating for Papastratos. With annual sales of $350 million, Papastratos is the largest importer in Romania where it enjoys a 15 percent market share with its Assos International. It also has the largest presence in the highly fragmented Ukrainian market thanks to its President brand, Salomon says. Producers in Romania's 21 billion cigarette a year market -- East Europe's second largest after Poland -- still see scope for growth, with lax post-communist anti-tobacco laws. "We have an extraordinarily high demand and I don't see how it could be affected for the time being," says Sorin Muntnau, Romanian Tobacco Authority Manager. "If the market falls in the West, tobacco producers will rush in force to the East," he added. Last year RJ Reynolds opened a greenfield plant near Bucharest and BAT also plans to build a plant in a country where one out of four Romanians is a smoker and where health warnings on cigarettes are not yet compulsory. "Papastratos' dynamic marketing approach will ensure strong export growth. A 40 percent volume increase is projected in 1996 to 20.2 billion units and a conservative 35 percent growth forecast for 1997," says Salomon Brothers analyst Stacy Adams. In retrospect, Balkan and Eastern European cigarette sales growth has risen exponentially, notes Salomon. "Papastratos saw exports increase exponentially from 1.1 billion units in 1989 to 14.4 billion in 1995, reflecting the opening up of Eastern European markets." And while in the U.S. the attack on cigarette makers is heating up as states begin to sue tobacco law firms, in the Czech Republic, analysts remain cool expecting no impact on the local market. They say shares in leading cigarette maker Tabak A.S., majority-owned by Philip Morris, will not be affected by a spate of events that are hitting hard tobacco issues in western markets. "It is unlikely that there will be a negative reaction by domestic investors (over the court case) with regard to Tabak," says Leos Jirman of BH Securities in Prague. Tabak's dominant position in the expanding domestic market is not threatened, other analysts agree. In Greece where tobacco is still touted in grade school books as a major product along with olives and raisins there is no major concern that the West's anti-smoking hysteria will catch on fast, smokers say. While TV and radio cigarette ads are prohibited, most companies do not have an official policy on smoking in the work place. Measures avoid extremes practiced in the West where smokers are relegated to second-class citizens. "There has been a limited anti-tobacco campaign and it has not been shocking. Perhaps because it accomodates the tobacco industry. Separating smokers in restaurants would not go down well," says Tsirimonaki. Jokes abound of U.S. smokers coming down from skyscraper offices to have a puff, as if they were practicing a sin, increasingly marginalised. Even the passive smoking argument is seen as extreme. "Passive smoking bothers you in Athens? Come on, what about all the pollution you inhale, its extreme," says Tsirimonaki, exhaling. 2267 !E12 !ECAT !G15 !G154 !GCAT !M13 !M132 !MCAT Participation in the exchange rate mechanism (ERM) is likely to be interpreted as a criterion for membership in EMU, Finance Minister Sauli Niinisto was quoted as saying in weekly magazine Suomen Kuvalehti on Friday. Niinisto last said on August 8 that it had become more obvious that joining ERM might be necessary. Suomen Kuvalehti also quoted him as saying that he trusts that demands for a link at least two years before a decision on which countries will qualify for EMU were not unconditional. "Though the time limit is flexible, it does not at all mean a link could be made at the last minute," he said. -- Helsinki newsroom +358-0-6805 0245 2268 !GCAT !GPOL !M12 !MCAT U.S. presidential Candidate Ross Perot invests a lot of his money abroad and Greek bonds are one of his favourite investments, the daily Athens News reported on Friday. "Perot keeps his billions working for him in a mix of stocks, real estate and at least $450 million in foreign government bonds. One of his preferred investments is Greek bonds in which he has invested at least $50 million," it said. Perot, with an estimated wealth of $2.6 billion according to Forbes magazine, filed a financial disclosure report listing 595 separate holdings. Among the investments were bonds valued at over $50 million each from Australia, Belgium, Canada, France, Germany, Spain, Greece, Italy and Japan, Athens News said. --George Georgiopoulos, Athens Newsroom +301 3311812-4 2269 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The executive of the union representing Britain's postmen said it had decided not to extend a planned strike next weekend to four days as it had threatened. The Communications Workers Union, which has already called strikes for August 30 and September 2 had threatened to call its members out on the two intervening days. But the executive said in a statement that this extension would not take place in view of the fact that it has agreed to meet the Royal Mail employers later on Friday under the auspices of the Advisory Conciliation and Arbitration Service. -- London Newsroom +44 171 542 7947 2270 !C21 !CCAT !GCAT !GVIO Airfreight specialist, AirRep (UK) Limited said it has moved 90 tonnes of humanitarian supplies to the Chechen capital Grozny this week 48 hours. Ilyushin 76 aircraft operated by North East Cargo Airlines of Magadan, Russia were used to move the supplies, it added in a statement. The first, on August 21, involved 45 tonnes from Oslo on behalf of Norwegian Church Aid organised by Copenhagen-based AirRep (Scandinavia). The second was a 45 tonne UNHCR charter which left Ostend early today carrying vital supplies including incubators, blankets, medical equipment, and feeding kits. - Air Cargo NewsroomTel+44 171 542 7706 Fax+44 171 542 5017 2271 !C24 !CCAT !E41 !ECAT !GCAT !GJOB RJB Mining Plc said on Friday that miners at Point of Ayr in north Wales have decided not to make a buy-out offer for the loss-making pit which will be closed tonight. An RJB spokesman told Reuters miners had made the decision one hour ago. Miners' trade union representatives had approached the company about a possible deal but subsequently learned of the extent of losses from the mine. Losses totalled five million stg since the mine was bought from British Coal 19 months ago. Point of Ayr is the last deep coal mine in north Wales. 2272 !GCAT !GCRIM !GPRO A British photographer branded a stalker by Princess Diana has been forced to postpone a legal challenge to a ban on approaching her because he's been jailed for criminal damage, his lawyer said on Friday. Martin Stenning started a 12-week jail sentence on Thursday just as he was preparing to contest an injunction obtained by Diana banning him from coming within 300 metres (yards) of her. "We were in the process of preparing a detailed affidavit responding to the Princess's affadavit and expected to go to court in the next couple of weeks," said Stenning's lawyer, Benedict Birnberg. "But everything has been put on ice now." Birnberg told Reuters that the challenge to the injunction would be delayed until Stenning was released. Stenning threw a brick through the window of a van in February after an argument with a driver when he was working as a motorcycle dispatch rider. Stenning, who has previous convictions, is expected to appeal against the sentence. Magistrates also ordered him to pay compensation of 182 pounds ($282). The freelance photographer was branded a stalker by Diana, whose divorce from heir-to-the-throne Prince Charles is due to become final next week, after persistently trailing her on his motorcycle. In an affidavit, the princess said that in chasing her Stenning had got so close that he twice smashed into her car and pushed her when she tried to remove the film from his camera. Stenning has rejected Diana's claims and said he was being made a scapegoat to scare off press photographers. 2273 !C12 !C17 !CCAT !GCAT !GCRIM Lloyd's of London held its breath on Friday for a U.S. court ruling on its three billion pounds ($4.65 billion) recovery plan, the crucial launch pad to secure the centuries-old insurance market's future. The judge in a law suit brought against Lloyd's in Richmond, Virginia, by U.S. investors trying to halt the plan has deliberated for two days. He is due to announce his ruling by Friday evening London time. Lloyd's is confident that the judge's decision will not prevent implementation of its recovery proposals, under which it aims to reinsure billions of pounds of pollution- and asbestos-related liabilities into a new company called Equitas. It is asking investors -- called Names -- to help fund Equitas, which will allow the market to pass an annual solvency test and enable the investors liable for huge pre-1993 losses to end their involvement. The recovery plan includes a 3.2 billion pounds settlement offer to soften the cost to Names of the Equitas scheme and end litigation. Lloyd's chairman David Rowland told Reuters in an interview on Thursday evening that, with only days to go until the August 28 deadline by which Lloyd's wants Names to vote on the recovery plan, a substantial number of U.S. Names had already accepted. "I think it's extremely unlikely that the judge would wish to overrule the free choice that they have already made," said Rowland of these U.S. Names and of the basis on which Lloyd's has made its contingency plans for such a late legal challenge. While judge Robert Payne has indicated he does not want to derail the recovery plan worldwide, he was also expected to provide the 93 U.S. Names in the Virginia case with some sort of relief. There are 2,700 Names in the United States and 33,500 worldwide. The Names who launched the latest assault against Lloyd's say the market is violating U.S. securities laws and are demanding more information on syndicate reserves. Lloyd's contends that they are bound by contract to sue it in Britain. A significant setback which prevented Lloyd's from accessing funds needed by the end of September for its recovery plan could be challenged. Rowland said Lloyd's would appeal any injunction. Rowland expects Lloyd's to obtain the substantial majority of votes in favour which is needed to go ahead with the recovery proposals as planned. The total level of acceptance so far is well ahead of expectations. Once the offer is declared unconditional, Lloyd's could then give those Names who have not assented by the voting deadline extra time in which to do so -- a potential olive branch to a dissident minority in the United States and Britain. However, a Wall Street Journal report suggested on Friday that the threat to Lloyd's in the United States was growing. The insurance market last month secured a deal with securities regulators in 38 U.S. states broadly solving the problems it has had there. But the report said top legal officials from New York and Colorado, two states which played key roles in negotiating the settlement, felt the deal should not prevent American investors in Lloyd's from suing it in the United States. Lloyd's was unable to comment immediately on the report. -- London Newsroom +44 171 542 7721 ($1=.6458 Pound) 2274 !GCAT !GCRIM Hundreds of prisoners in England and Wales looked forward on Friday to an earlier-than-expected release following an embarrassing blunder by their jailers. And Home Secretary Michael Howard, Britain's interior minister, said many of them may be entitled to compensation for having been kept too long behind bars. A legal challenge brought by inmates last year led to a ruling by Britain's Court of Appeal that the Prison Service was miscalculating the time due to be served by many prisoners given consecutive sentences for a number of offences. For instance, a prisoner who spent a month in a remand centre before trial, and was then given three consecutive sentences, should have the total period he had to serve in jail reduced by three months, not one, it ruled. The Prison Service has only just started to act on this ruling and this week released 45 inmates from three jails. Asked how many others would be affected, a Prison Service spokeswoman said: "The number could reach double or triple figures, but we are certainly not talking about thousands." The Times newspaper reported that prisoners could receive 95 pounds ($147) a day in compensation for the blunder. The bill for the taxpayer could thus run into millions of pounds. "Those who have been affected and have been kept in prison for longer than they should have been might well be entitled to compensation." Howard told BBC radio. He described the error as "extremely regrettable" and said it now needed putting right as soon as possible. The bungling is a further blow for Howard who has been embarrassed in the past year by a string of adverse court rulings and by critical inquiries into break-outs from two top high-security prisons. Late last year Howard dismissed the head of the Prison Service, Derek Lewis, after Lewis had criticised him for interfering in the day-to-day running of jails. Opposition parties seized on the new blunder. "He has been organising the service in a way in which minds have been concentrating on gimmicks... which has taken their eye off the ball," said Alan Beith of the minority Liberal Democrats. But Prison Service acting director-general Alan Walker denied Howard was to blame: "It is not the Home Secretary who does the (sentencing) calculations. It is the Prison Service." 2275 !GCAT !GCRIM A six-day courtroom interrogation of a British rape victim by her atttacker provoked calls on Friday for changes to the law that allowed the man to conduct his own defence. "I have been raped twice; once in his filthy den and once in front of judge and jury in a British court of law," 34-year-old Julia Mason said after the trial. Ralston Edwards was found guilty on Thursday of raping Mason on two occasions while he held her imprisoned at his home in London for 18 hours. Mason, who took the unusual step of waiving her right to anonymity so she could tell her story to Britain's media, said she believed Edwards had got further gratification from being allowed to humiliate her in court. "He lapped up the exhibitionism and gained perverted pleasure asking me about my private parts and his. It was sickening," she told the Daily Mail newspaper. Edwards had a history of offences against women, which under British law could not be revealed to the court during the trial. He was jailed in 1984 for raping a neighbour and has been charged three times with actual bodily harm against women. The 42-year-old who made a living selling condoms to prostitutes, dismissed his lawyer on the first day of his trial. Mason was only informed that he would cross-question her on the day she entered the witness box. "I felt sick to the pit of my stomach. How could this happen?" she said. "The law must be changed. I do not want other women to go through what I have been through." Edwards will be sentenced later this month. Britain's interior minister Michael Howard said he would examine the case to see whether changes in the law were needed. "If there are lessons to be learned from this case, I am as keen as anyone to learn them," he said. In 1991, Britain withdrew the right for suspects conducting their own defence to question their alleged victims if they are children. Women's groups said they wanted the law extended to prevent them from questioning women in cases of rape and assault. They said they feared Mason's experience would discourage women from reporting sexual crimes in future because of the ordeal they may face in court. "This should never have been allowed to happen. The judge should have stopped the proceedings," said Julie Bindel of the International Conference on Women and Violence. 2276 !GCAT The following are top headlines from selected Canadian newspapers. Reuters has not verified these stories and does not vouch for their accuracy. THE GLOBE AND MAIL: - Provincial premiers give Ottawa deadline: All but Quebec back 8-point plan to negotiate new social-policy standards. - Traces of explosive found on jet debris: TWA craft split near site of residue. - Prime rate drops to 5.75 percent, some banks trim mortgage rates. The Bank of Canada has again lowered its key interest rate, in what many analysts believe will be its final attempt this year to kick-start a stubborn economy. - Education system broken, Ontario Education Minister John Snobelen declares: Minister calls costs too high, cites study blaming teachers' pay. - Ottawa Rough Riders third and long with no time left: Canadian Football League governors will meet on Monday to decide fate of struggling 120-year-old football club. Report on Business Section: - CT Financial sells First Federal Savings & Loan: Trust says market conditions right to move U.S. unit to Marine Midland for C$935 million. - Plot thickens in book war: Chapters Inc's response to the hiring of former employees in a bold attempt to create a national chain has evolved into a strange tale of intrigue involving gumshoes and lawsuits. - Hudson's Bay profit plunges: Department store chain blames weather, sluggish economy. - Tide turning against U.S. tobacco giants: President Bill Clinton is placing new limits on cigarette makers and the industry has plenty to lose as smoking becomes an election issue. THE FINANCIAL POST: - New low-rate era in sight: Latest prime drop to 5.75 percent could usher in prolonged period of lower-than-U.S. rates. - CT Financial withdraws from U.S. with C$935-million sale of New York savings and loan. -- Reuters Toronto Bureau 416 941-8100 2277 !C21 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Canada's Prairies on Friday were forecast to see mostly warmer than normal daily highs to Tuesday with a slight risk of frost in the west Sunday morning and in the east Monday morning, Environment Canada said. Alberta's normal high is in the low 20s Celsius (68.0 F). Highs Friday through Tuesday were forecast to reach 25 C, 22 C, 26 C, 27 C and 27 C, meteorologist Gerald Machnee said. Saskatchewan's normal high is 24 Celsius (75.2 F). Highs Friday through Tuesday were forecast to reach 28 C, 26 C, 24 C, 27 C and 29 C, Machnee said. The western Prairies may see a risk of frost early Sunday. Manitoba's normal high is 24 Celsius (75.2 F). Highs Friday through Tuesday were forecast to reach 26 C, 27 C, 22 C, 24 C and 26 C, Machnee said. -- Gilbert Le Gras 204 947 3548 2278 !GCAT !GWEA Southwest Saskatchewan's Parkland area and mid-Alberta's Red Deer area saw two hours of a slight risk of frost Friday, Environment Canada said. Val Marie, Sask., reported a low of 3.2 Celsius (37.8 F) at chest level at 0600 CDT/1100 GMT, and 3.8 Celsius (38.8 F) at 0700 CDT/1200 GMT, meteorologist Gerald Machnee said. Red Deer, Alta., reported a low of 4.0 Celsius (39.2 F) for two hours. "At three to four degrees you can get close to zero (freezing) in some spots," Machnee said. The remainder of the Prairies were 5.6 Celsius or warmer. Temperatures at ground level can be 2.0 to 5.0 Celsius lower than at chest level depending on windspeed, sky conditions and ground surface moisture. Freezing occurs at 0 Celsius (32.0 F). -- Gilbert Le Gras 204 947 3548 2279 !C21 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Canada's Prairies on Friday were forecast to see mainly sunny skies and slightly warmer than normal temperatures, Environment Canada said. Alberta should see mainly sunny skies with a high of 25 Celsius. Saskatchewan should see mainly sunny skies with a high of 28 Celsius. Manitoba should see mainly sunny skies with a high of 26 Celsius. -- Gilbert Le Gras 204 947 3548 2280 !GCAT !GVIO Turkish Kurd guerrillas said on Friday they would free seven Turkish soldiers they hold in northern Iraq under a tentative Islamist peace bid. "...for the sake of safety we are asking for their family members or the authorities to come and pick them up," Kurdistan Workers Party (PKK) central committee member Riza Altun told journalists near the Iraqi city of Dohuk. PKK guerrillas would accompany the soldiers, captured last spring in one of Turkey's frequent cross-border drives, until they could be handed over, he said. Their release has been negotiated by Islamist writer Ismail Nacar as part of a wider effort, partially backed by Prime Minister Necmettin Erbakan, to find a political solution to Turkey's Kurdish problem. Erbakan has encouraged Nacar's bid but has ruled out direct talks with the rebels. The PKK often uses bases in northern Iraq in its fight for autonomy or independence in southeast Turkey. More than 20,000 people have died in 12 years of fighting between the guerrillas and Turkish forces. Three people, including two state-paid village guards, died when a mine planted by the rebels exploded on a road in southeast Turkey on Friday, Anatolian news agency said. It said a taxi carrying the guards, members of a mostly Kurdish militia that fights the PKK, hit the mine in the province of Diyarbakir. 2281 !GCAT !GVIO The main Friday prayers that were the starting point for bread riots in Jordan a week ago passed peacefully under tight security imposed by the Jordanian army with only brief demonstrations reported. In the hilly town of Salt, 25 km (15 miles) north west of Amman, 300 men marched in a main street demanding the release of a handful of residents held in connection with unrest. Some threw stones at police, but the security forces did not intervene. In Karak, where two days of riots flared last Friday, a few hundred young men lingered outside Omari mosque on leaving, shouting slogans for about 15 minutes. They did not repeat last week's protests against higher bread prices that turned into the worst unrest in Jordan since 1989. "Disperse, abstain from forming groups and help maintain order," the army, which has enforced a loose curfew since the riots, told the crowd through loudspeakers. The men shouted "Allahu Akbar (God is Greatest)" as a former Islamist deputy, Ahmed Kafawin, told soldiers the crowd would not cause trouble. He had earlier mounted the mosque's pulpit to demand release of detainees, an end to raids on houses and a reversal of the decision to double bread prices. Armoured vehicles had patrolled streets and guarded entrances to the hill-top city famed for its Crusader castle in tight security before the prayers. There was also heavy security in the crowded centre of Amman, where smaller clashes had erupted last Saturday, but Friday prayers at the main mosque ended quietly as police in full riot gear looked on. Many Karak residents said a conciliatory speech by King Hussein on Thursday appeared to ease the tension fuelled by his "iron fist" policy of mass arrests and a military curfew after riots last Friday and Saturday. The king defended the new bread prices but told parliament deputies -- most opposed to the price increase -- he remained committed to democracy, public freedoms and fighting corruption and abuses of power. "The king's speech was very clever, he was more lenient and talked about a process of reviewing policies that caused the unrest and re-evaluating prices," said Mohammad Rawashdeh, a teacher. "He sounded more reprimanding than threatening." Farmer Salem Kassassbeh, standing by the mosque doors as worshippers entered, said the Friday prayers were a key test: "There is a state of anticipation for the noon prayers, and if nothing happens after that, then people will be quiet and accept the situation." Government officials said authorities would start freeing some of the 200 detainees -- more than half in Karak -- late on Friday if there is no further trouble and expect the king to summon the parliament suspended over the riots by October 1. While some Karak residents ruled out further unrest because "inciters" were in jail or had fled, many warned of trouble after the army leaves if economic grievances are not tackled and detainees freed. The king blamed Iraq and a local pro-Baghdad group for the riots after the government raised bread prices under IMF-agreed economic reforms. But critics blame the riots on poverty and unemployment. Bread is a staple food for the poor who form a majority of Jordan's 4.2 million people. 2282 !GCAT !GDIP !GPOL A Moroccan human rights group on Friday denounced what it described as the French government's "inhuman treatment" of African immigrants and accused it of racism. "The Moroccan Human Rights Association denounces the mass expulsion of African immigrants including Moroccans and protests against the inhuman treatment they received by the French authorities...It considers such a behaviour as an example of racism," it said in a statement faxed to Reuters. French Police, using batons and teargas, stormed a Paris church on Friday and evicted 300 African immigrants, 10 of whom were on a 50-day-old hunger strike in protest against moves to expel them from France. The Moroccan human rights group urged the French government to respect the international conventions and agreements on human rights and "allow the African immigrants to normalise their legal status in France." The decision to send in the police came after French Prime Minister Alain Juppe announced on Thursday that France's highest administrative court, the Council of State, endorsed his view that the 300 Africans were not entitled to residence permit. He said the government still intended to review their right to remain in France on a case-by-case basis and had no intention of using deportation to break up families or expel seriously ill individuals. Many of the protesters say they once had residence rights and were plunged into illegality by hardline 1993 immigration laws. Lawyers say loopholes in the laws, which also tightened conditions for citizenship, have created a legal nightmare. 2283 !GCAT !GDEF !GPOL Israeli Prime Minister Benjamin Netanyahu on Friday formed a White House-style National Security team to advise him on security issues. "The prime minister in coordination with the defence minister has decided to set up a National Security team in the prime minister's office," Netanyahu's office said in a statement. The statement said the team would advise the prime minister on security issues including intelligence assessment, terrorism and strategic planning. Netanyahu won Israel's May election by pledging to bring peace with security following Moslem suicide bombings that killed 59 people in the Jewish state in February and March. The team, now comprised of four officials and due to be expanded, will be headed by Netanyahu's military adviser Major-General Zeev Livneh. The prime minister had announced at his first cabinet meeting in June that he would establish a National Security Council. Absent from the team was the director-general of the Defence Ministry, Major-General Reserve David Ivri, who Netanyahu had originally said would head it. Israeli media had reported at the time that Defence Minister Yitzhak Mordechai was upset that Ivri would be granted additional powers. "The defence minister requested from the prime minister to retain Major-General Reserve David Ivri in the Defence Ministry due to his important role in the establishment," said the statement, adding that Netanyahu had responded positively. 2284 !E51 !E512 !ECAT !GCAT !GDIP Oman on Friday urged Israel to resume negotiations with Arabs on the agreed principles of the Middle East peace process which paved the way for an exchange of trade missions between the two countries, the official Oman News Agency reported. "Oman and Israel signed an agreement to open trade missions in the two countries based on the peace process and the peace process is based on the principle of land for peace and United Nations resolutions," it quoted Minister of State for Foreign Affairs Youssef bin Alawi bin Abdullah as saying. "And all of these resolutions are in the agreement to open trade offices," he added. The Omani minister "called on Israel not to delay the resumption of negotiations with the Arab sides on the basis of agreed upon principles such as land for peace, (U.N.) Security Council resolutions and the withdrawal from occupied Arab land." Oman and Qatar have forged ahead of other Gulf states in opening economic ties with the Jewish state but have stopped short of establishing full diplomatic relations. Oman opened a commercial interest office in Tel Aviv on August 11, making the energy-rich sultanate the first Gulf Arab state with economic representation in Israel. The two countries agreed in January to exchange trade missions in a step towards normalising relations. Israel opened its office in Muscat in May. Other Arab states, led by Syria, have said normalisation must wait until Israel withdraws from all Arab lands it occupied in the 1967 Middle East war. Hardline Israeli Prime Minister Benjamin Netanyahu has angered Arab states by rejecting the principle of trading occupied Arab lands in return for peace, the basis of the 1991 U.S.-led Madrid peace conference. 2285 !GCAT !GCRIM !GDIP !GVIO Iran's top judge on Friday urged Germany not to politicise a court case over the killing of Kurdish opposition leaders by admitting the testimony of an exiled former Iranian president. Paris-based Abolhassan Banisadr testified at a Berlin court on Thursday and Friday, alleging that Iran's supreme leader Ayatollah Ali Khamenei had ordered the 1992 killing of three Kurdish leaders and their translator in a Berlin restaurant. "What is the judicial validity of a ruling that would be based, even for a few hundredths of percent, on the testimony of a deposed person who has fled this country? ," head of Judiciary Ayatollah Mohammad Yazdi said in a mass prayer sermon broadcast on Tehran radio. "The honourable German prosecutor will naturally take the necessary precautions so that the good repute of (Germany's) judicial system is not affected by getting mixed up in politics," Yazdi said. An Iranian and four Lebanese have been on trial for nearly three years for the gangland-style slayings. Banisadr has been an active opposition figure since he fled to Paris in 1981 after being deposed as Iran's first president on orders of the late spiritual leader Ayatollah Ruhollah Khomeini. Iran has consistently denied any involvement in the assassinations. Tehran has also rejected Banisadr's allegations, saying that he is a fierce opponent of its Islamic government and that his ties with Iran were severed years ago. The case has strained ties between Tehran and Bonn, Iran's main trading partner, particularly after German prosecutors in March issued an arrest warrant for Iranian Intelligence Minister Ali Fallahiyan, accusing him of masterminding the attack. 2286 !GCAT !GDIP Jordan has asked an Iraqi diplomat to leave the kingdom for carrying out duties incompatible with diplomatic norms, an official source said on Friday. The move came after Amman blamed Iraq and a pro-Baghdad local political party for last week's worst unrest in seven years after a government decision to double prices of bread. The government declined comment. "Jordan has asked Mr. Adel Ibrahim, the Iraqi embassy's press attache, to leave because he was carrying out duties incompatible with diplomatic norms," the source told Reuters. He said Ibrahim was still in Amman. The Jordanian Arab Socialist Baath Party has denied involvement in unrest which it blamed on government policies and rising economic hardship. The riots, which shook Jordan for two days, broke out after last Friday's main prayers in the southern town of Karak and spread to Amman. 2287 !GCAT !GDIP !GVIO Turkish Kurd guerrillas said on Friday they would free seven Turkish soldiers they hold in northern Iraq under a tentative Islamist peace bid. "...For the sake of safety we are asking for their family members or the authorities to come and pick them up," Kurdistan Workers Party (PKK) central committee member Riza Altun told journalists near the Iraqi city of Dohuk. PKK guerrillas would accompany the soldiers, captured last spring in one of Turkey's frequent cross-border drives, until they could be handed over, he said. Their release has been negotiated by Islamist writer Ismail Nacar as part of a wider effort, partly backed by Prime Minister Necmettin Erbakan, to find a political solution to Turkey's Kurdish problem. Erbakan has encouraged Nacar's bid but has ruled out direct talks with the rebels. The PKK often uses bases in northern Iraq in its fight for autonomy or independence in southeast Turkey. More than 20,000 people have died in 12 years of fighting between the guerrillas and Turkish forces. 2288 !GCAT !GDIP !GPOL Israeli Prime Minister Benjamin Netanyahu pledged at a cabinet meeting on Friday to restart peace talks with the PLO, reaffirming a commitment he made a day earlier to Egypt's president. "We intend to renew the talks with the Palestinian Authority after the steering committee on both sides is set up to conduct negotiations," a statement quoted Netanyahu as telling his ministers. The communique gave no time frame but in a sign talks could start soon, Netanyahu this week met former army chief Dan Shomron, designated to head Israel's delegation on the committee that coordinates implementation of Israeli-PLO peace deals. Palestinian Minister of Local Government Saeb Erekat is to head the PLO team on the steering committee. Netanyahu, apparently shaken by Egyptian President Hosni Mubarak's suggestion he might cancel a Middle East economic summit in November over Israel's stalled peace moves, telephoned Cairo on Thursday to assure Mubarak of renewed talks. The prime minister told the cabinet he was under the impression the economic summit would go ahead as planned. There was still no Israeli announcement of a date for a long-delayed troop pullback from the West Bank town of Hebron, a redeployment the PLO regards as a litmus test of Netanyahu's peace intentions. Defence Minister Yitzhak Mordechai recently presented a revised redeployment plan to the prime minister. It is still under discussion by senior ministers. The cabinet statement quoted Netanyahu as saying no pullback agreement would be signed without first being presented to the entire government. Netanyahu cautioned ministers to keep quiet about the issue. "If ministers wish to speak out on such sensitive topics they must coordinate this first with me, the foreign minister or with the defence minister," the statement quoted him as saying. Israel has said it would not implement the Hebron plan until the Palestinian Authority closed its offices in Arab East Jerusalem. Palestinians have rejected the condition as well as Israel's intention to renegotiate the Hebron deal. Relations between Israel's right-wing government and the Palestinian self-rule administration sank on Thursday to their lowest point since Netanyahu took power in June. Palestinians were incensed when Israel delayed for three hours a flight by President Yasser Arafat from Gaza to the West Bank for a meeting with former Israeli leader Shimon Peres, with whom he shared a Nobel peace prize. Arafat cancelled an Israeli-PLO meeting on civilian affairs in protest. Palestinian officials complained Netanyahu's policies made negotiations an empty exercise. Despite the crisis, Palestinian officials confirmed that senior PLO official Mahmoud Abbas held talks with Netanyahu political adviser Dore Gold in Tel Aviv on Thursday. They gave no details, but Israel's army radio said Gold and Abbas discussed a resumption of the steering committee talks. 2289 !GCAT !GVIO A fresh outbreak of fighting between northern Iraq's fractious Kurds on Friday threatened a U.S.-led peace plan to unite the mountainous region against President Saddam Hussein. A Kurdish guerrilla group said it had inflicted "a major defeat" on a rival militia after almost a week of clashes that has shattered a ceasefire brokered last year by Washington. The Kurdistan Democratic Party (KDP) of Massoud Barzani said on Thursday night it had repelled an attack by thousands of Patriotic Union of Kurdistan (PUK) fighters -- killing, wounding or capturing about 400 opposing guerrillas. "The PUK force were defeated and chased all the way to the Iranian border," the KDP said in a statement. The PUK, led by veteran warlord Jalal Talabani, was not available for comment. The fighting has dashed the latest U.S. efforts to set up a workable Kurdish entity outside Baghdad's sphere of influence and has raised the spectre of greater Iranian involvement in the area. "The West has put quite a lot into putting the peace process together and it doesn't look too clever when it is stalled and then collapses," a NATO member diplomat said. The Kurds agreed early last year to end more than a year of clashes that cost around 3,000 lives. But a full peace deal, agreed to at U.S.-sponsored talks in Ireland, is in limbo. The militias have failed to implement an accord to share revenues from the KDP's makeshift oil trade on the Turkish border and demilitarise the PUK-held main city of Arbil. Bad blood between Iraq's Kurds goes back to the mid-1960s when Talabani broke with the KDP. Western experts say he later sided with Iraqi government troops against his fellow Kurds. The KDP has accused Talabani's forces of receiving military support from Iran in the current fighting. The PUK denies this and charges that Barzani's group is collaborating with Baghdad. Possible Iranian backing for either of the Kurd groups worries the West as much, if not more, than its own loss of prestige in northern Iraq. "Everyone has been told to keep away from the Iranians," said KDP Ankara representative Safeen Dizayee. A State Department spokesman in Washington, which accuses Iran of sponsoring international terrorism, said earlier this week that the fighting could "create opportunities for outside players whose agendas have nothing to do with the best interests of the citizens of northern Iraq." He was referring to Tehran. Several thousand Iranian troops briefly entered northern Iraq last month and killed about 20 Iranian Kurdish guerrillas based there. "If Iran is not directly involved this time then it is certainly trying to increase its influence," the Western diplomat said. U.S., British and French planes have been patrolling the skies of northern Iraq since shortly after the 1991 Gulf War to shield Iraq's Kurds from any attack by Iraqi troops. The air force is part of a concerted U.S.-led effort, backed by tough economic sanctions, to keep the pressure on Saddam's rule. 2290 !E51 !E512 !ECAT !GCAT !GDIP Japanese Foreign Minister Yukihiko Ikeda opened talks with Syrian leaders in Damascus on Friday on what Japan could offer to break a deadlock in Arab-Israeli peace negotiations. Officials said that Ikeda, who arrived from Egypt on the second leg of a regional tour, would also discuss with his Syrian counterpart Farouq al-Shara how to promote economic cooperation with Syria which has received more than $1.5 billion in aid from Japan since 1973. "As you know the peace process in the Middle East region is facing a very difficult phase now. Japan would like to explain to the Syrian side that it would be ready to exert any effort to maintain the peace process and to push it forward," Ikeda told reporters on arrival in Damascus. "We are ready to exert any role whether it is economic or political." Syria's peace talks with Israel are stalled over the fate of the Golan Heights, captured by Israel in 1967, and future ties. Ikeda is due to meet president Hafez al-Assad on Saturday before heading to Jordan. He will also visit Israel, the Palestinian self-rule areas and Saudi Arabia. Japanese officials said Ikeda would visit later on Friday the Japanese military unit serving in the Golan within the United Nations Disengagement and Obeservation Force (UNDOF). The 45-man Japanese unit started its mission which is mainly a logistic one in February. "The decision to send the unit reflects our keen desire not to limit our contribution only to the economic development but also to the efforts aimed at maintaining peace in the area," a Japanese official told Reuters. He said Ikeda would sign an agreement on Saturday for a 1.022 billion yen ($9.46 million) grant to help finance the construction of an electric power training centre in Syria. The grant is connected with a 1991 soft loan of 51.598 billion yen to build a power station project in Jandar, 140 km (90 miles) north of Damascus, the official said. Japanese aid began to flow to Syria in 1973 with a 8.858 billion yen item for an irrigation project in Meskene area in Aleppo, 350 km (220 miles) north of Damascus, he said. He said loans, grants and technical aid given to Syria since then totalled about 164.609 billion yen -- about $1.5 billion at the current exchange rate. ($1 = 108 yen) 2291 !GCAT !GVIO Authorities mounted heavy security in Karak in advance of Friday prayers, the starting point a week ago for protests against higher bread prices that turned into the worst unrest in Jordan since 1989. Armoured vehicles patrolled streets and guarded entrances to the hill-top city famed for its Crusader castle as Moslems headed for prayers at the main al-Omari mosque under the eyes of soldiers. There was also heavy security in the crowded centre of Amman, where smaller clashes erupted last Saturday, in advance of Friday prayers at the main mosque. However, many Karak residents said a conciliatory speech by King Hussein on Thursday appeared to ease the tension fuelled by his "iron fist" policy of mass arrests and a military curfew after riots last Friday and Saturday. The king defended the decision to double bread prices but told parliament deputies -- most of them opposed to the price increase -- he remained committed to democracy, public freedoms and fighting corruption and abuses of power. "The king's speech was very clever, he was more lenient and talked about a process of reviewing policies that caused the unrest and re-evaluating prices," said Mohammad Rawashdeh, a teacher. "He sounded more reprimanding than threatening." Farmer Salem Kassassbeh, standing next to the mosque doors, agreed: "There is a state of anticipation for the noon prayers, and if nothing happens after that, then people will be quiet and accept the situation." Government officials said authorities will start freeing some of the 200 detainees -- more than half in Karak -- late on Friday if there is no further trouble and expect the king to summon the parliament suspended over the riots by October 1. While some Karak residents ruled out further unrest because "inciters" were in jail or had fled, many warned of fresh trouble after the army leaves if economic grievances are not tackled through dialogue and detainees freed. "Maybe people have fled for fear for arrest, or maybe they have become more accepting of the situation," said Samih Adayleh, carrying bags of fruit and vegetables. "But this could also cause pent up frustrations, even more than before." The king blamed Iraq and a local pro-Baghdad group for the protests after the government raised bread prices last Tuesday under IMF-agreed economic reforms. The king has reversed Jordan's close ties with Iraq since he gave asylum to President Saddam Hussein's sons-in-law a year ago. But critics blame the riots on rising poverty and unemployment. Bread is a staple food for the poor who form a majority of Jordan's 4.2 million people. The riots began in the Karak and quickly spread to other southern centres last week. By Saturday night there were clashes in Amman. It was the worst unrest in Jordan since 1989, when riots followed another government decision to raise prices. Then the king dumped his prime minister and began reforms. So far the king has shown solid support for Prime Minister Abdul-Karim al-Kabariti even though the Islamic-led opposition demanded his removal. The king's initial uncompromising response to the riots angered many Jordanians but since the unrest was contained he has been meeting deputies and local dignitaries to rebuild links and stage displays of unity. 2292 !E21 !E211 !ECAT !GCAT !GPOL Republican presidential candidate Bob Dole Thursday campaigned alongside one of the most popular tax-cutting Republican governors and said he wanted to do for the United States what Christine Todd Whitman had done for New Jersey. "I want to do for America's economy what Christie Whitman has done for New Jersey's economy and spread it across America," Dole said. Giving his stump speech at a bandstand in a leafy suburban park, Dole repeated the centerpiece of his campaign -- a 15 percent across-the-board income tax cut, slashes in capital gains taxes and a balanced federal budget. Critics have said it would be impossible to balance the budget while cutting taxes without eviscerating social programs, including Medicare and Social Security, but Dole said he could do it. He did not elaborate on how he would do so. Dole and running mate Jack Kemp said the experience of New Jersey showed that the Democrats were wrong and that it is possible to cut taxes while balancing the budget. "My Democratic friends believe that what belongs to the government is the government's and what belongs to you is negotiable. And they like to have it all," he said. "Now we believe you can spend your money more wisely than any government bureaucracy ever can, and that is why we're going to do what Christie Whitman and Republican governors have done all across America. We're going to balance the budget while cutting taxes, and it can be done," Dole declared to a small but enthusiastic rally that he dubbed "Clinton's retirement party." Whitman has cut state income taxes by 30 percent since taking office in January 1994. Whitman, campaigning alongside Dole in this state of moderate swing-voters, attributed 135,000 new jobs in New Jersey during her administration to her economic policies. "The Democrats say that you can't balance a budget and cut taxes at the same time. We know you can because you are doing it in New Jersey. Bob Dole knows what America needs and it isn't four more years of 'Broken promises Bill,'" Whitman said. Dole and Kemp also responded to Democratic criticism that their proposal to halve the capital gains taxes on investment profits would only make the rich richer. "This is something for all Americans," Dole later told another prosperous suburban crowd near Philadelphia. Citing the story of a middle-income suburban policeman who told him he would benefit from Dole's tax plans, Dole said cutting capital gains taxes would provide "opportunities so some day (any American) could be rich." A former football player and son of a truck driver, Kemp told the New Jersey crowd to stop thinking of the Republicans as the "Grand Old Party" and start regarding it as "the Grand Opportunity Party." He said the "class warfare" rhetoric of "elitist" Democrats had "turned my stomach." Dole termed his rally a "retirement party" for Clinton and said that whether he wanted it or not, next year the "former President Clinton" would get a 15 percent tax cut. Dole said his message was "very simple." "This country deserves to do better. That's the message we have. We're going to take it all across America." Dole has edged to just five points behind Clinton since the announcement of his tax cut plan, the choice of Kemp as running mate and the successful Republican convention, a Reuters poll said. The poll, released on Thursday, showed 41.5 percent supported Clinton and 36.3 percent Dole -- a gap of just 5.2 percentage points. Texas billionaire Ross Perot got 7.4 percent. 2293 !CCAT !GCAT !GDIS !GVIO Investigators have found scientific evidence that an explosive device was detonated inside the passenger cabin of the TWA jumbo jet that crashed off Long Island, New York, last month, The New York Times reported in its early Friday editions. Chemists at the Federal Bureau of Investigation crime laboratory have found traces of PETN, a chemical in plastic explosives, on a piece of wreckage retrieved from the jet's passenger cabin between rows 17 and 27, the newspaper said. The newspaper cited three senior officials deeply involved in the investigation who spoke on condition of anonymity. TWA's Flight 800 from New York to Paris exploded and crashed into the Atlantic Ocean off New York's Long Island on July 17. All 230 passengers and crew aboard were killed. While the new finding provides evidence that the plane was destroyed by an explosive device, a senior official noted that PETN, or pentaerythritol tetranitrate, is an explosive component commonly found in many bombs and surface-to-air missiles, making it impossible for now to know which type of explosive device destroyed the Boeing 747. The discovery meets the FBI's previously stated standard for declaring that the plane was brought down by a criminal act, the newspaper said. But senior investigators said they were not ready to declare the crash a result of a criminal act in part because they do not yet know whether the explosion was caused by a bomb or a missile. A senior investigator said federal authorities could never bring any suspects to trial until they have answered that question, the newspaper reported. He and other senior officials said they still hoped to find additional forensic evidence as salvage workers continue to retrieve more wreckage from the Atlantic. They are particularly interested in finding metal fragments showing what investigators call shock waves - physical damage left by a blast that holds signature markings demonstrating what type of device exploded. 2294 !E21 !E212 !ECAT !GCAT !GPOL The head of Oakland County, Mich., said Thursday he would push for the introduction of a bill in the Michigan Legislature that would allow the county to remove its financial support from $167 million of bonds issued for Detroit's convention center. Oakland County Executive L. Brooks Patterson said he intended to "crank up" his support of the measure in the wake of Tuesday's announcement that the Detroit Lions football team would leave the Pontiac Silverdome for a new stadium in downtown Detroit. Patterson said he resents that his county sends $4.5 million a year in hotel/motel taxes to help support $167 million of bonds Detroit sold in 1985 and refinanced in 1993 to expand its Cobo Hall convention center. Meanwhile, he said Detroit produced millions of dollars in incentives to lure the Lions out of Oakland County to a new stadium. "If they have that kind of money squirrelled away, let them pay for their own damn debt," Patterson said. The financing plan for the $225 million football stadium called for Detroit to issue $15 million of limited tax general obligation bonds, payable with Detroit Downtown Development Authority funds. The authority would also contribute $30 million of excess tax increment finance revenues. The downtown authority has already sold $40 million of tax-exempt tax increment financing bonds to fund infrastructure improvements for a new ballpark for the Detroit Tigers baseball team. The ballpark and the football stadium would be built next to each other in downtown Detroit, according to the plan unveiled on Tuesday. Patterson said he planned to talk with assistant Senate majority leader Michael Bouchard, R-Birmingham, who had been directing the drafting of a bill this summer, about introducing the measure. An aide to Bouchard was not available to comment Thursday. The possibility of the bill arose a year ago when news began surfacing that the Lions were mulling a move back to Detroit. The team had left the city for Pontiac in 1975. The bill envisioned last year would allow Oakland, Macomb and Wayne counties to keep revenues from their lodging taxes and apply them to their own tourism or economic development initiatives. The state would also be prohibited from diverting county funds to pay off the Cobo Hall bonds. But revenues from a state-wide liquor tax would still be available to pay off the bonds. Detroit officials have said the liquor tax generated enough revenues to cover debt service on the bonds, which were rated single-A by Standard & Poor's Corp. J. Edward Hannan, Detroit's budget director, said Thursday the proposed bill would impair the contractual rights of bondholders. "My feeling is once the state's been advised by legal counsel, they'll find this is not a viable option," he said. Hannan added that such a bill could also impact Michigan's credit and credibility with bondholders. --Karen Pierog, 312-408-8647 2295 !C12 !CCAT !GCAT !GCRIM A federal judge in New York on Thursday imposed $2.6 million in penalties against a European-based group charged with insider trading in the $2 billion takeover by Praxair Inc. of CBI Industries Inc., the Securities and Exchange Commission said. Judge Milton Pollack of the U.S. District Court in Mahnattan, entered the default judgment against the group, comprising seven firms and two individuals. In his order, Pollack required the defendants to return $1.4 million in illegal trading profits and pay more than $1.2 million in insider trading penalties. The defendants were identified in court papers as Ulbery Vermogensverwaltungs A.G., Fasan Anstalt, Axteria Establishment, Anstalt Ducata, Anstalt Nifur, Dornfold Holdings Ltd., Melilla Business Corp. and investors Benjamin Weiss and Gregoria Stainow. The defendants were initially unidentified when the SEC charged them in November because the banks that transacted the tradings for them invoked bank secrecy laws in Switzerland and Germany. To ferret out identifies of the defendants, the SEC first served court papers to U.S. brokerages that executed the transactions for the Europeabn banks. The SEC alleged the defendants placed orders of 84,000 CBI shares through the banks or their units two trading days before Praxair announced its $32-a-share tender offer for CBI in October. The banks were then asked to serve the papers to their clients, the SEC said. The agency identified the banks as Nordfinanz Bank Zurich, Union Bancaire Privee, Bank Leu A.G., and Societe Generale Elsaessische. The U.S. brokerages which executed the trades were Gruntal & Co. Inc., Donaldson, Lufkin & Jenrette Securities Corp. and Commonwealth Associates, the SEC said. The banks, the brokerages and other agents through which the defendants transacted the illegal trades were not charged with any wrongdoing in the case. The agency initially estimated that the group made about $1.3 million from the illegal trades, based on CBI's stock price, which jumped 53 percent or by $10.625, closing at $30.75 on the day the bid was announced. Danbury, Conn.,-based Praxair, the largest industrial gas company in North and South America, completed its takeover of CBI, a carbon dioxide and industral gas producer based in Oak Brook, Ill., in March. An order freezing the defendants' CBI shares valued at more than $2 million was issued shortly after the SEC filed its lawsuit. The assets, now held in court, will be used to pay for part of the penalties, said SEC lawyer Antonio Chion. Judgments of $169,977 and $398,598 representing illegal profits and prejugment interest against Dornford and Melilla, respectively, will be pursued in Switzerland, she said. 2296 !E21 !E211 !ECAT !GCAT !GPOL New York State, which is hoping to rein in costs more as it goes through fiscal year 1997, has asked its agencies to study whether they can further streamline their operations. Explaining that the state's agencies have been given different scenarios, a spokesman for the state division of budget said the cuts that were suggested range from two to 10 percent. However, he made it plain that the process was part of an ongoing process and further work was needed. "It's a give and take between the agencies and this office," said John Signor on Thursday. The budget director, Patricia Wentworth, sent the directive to the agencies on July 30, and they were required to report back by August 9. Her spokesman explained the exercise reflects the Pataki Adminisration's commitment to doing its job more efficiently, and held open the possibility that the state might end the 1997 fiscal year with some of last year's strength. "We didn't end last year with a $445 million surplus and by putting $65 million in the Rainy Day Fund because we passed the budget and then ignored everything." While New York City Mayor Rudolph Giuliani, trying to deal now with budget gaps that are projected to hit $3.4 billion by 2000, last week directed his agencies to find $500 million in savings, a rating analyst said the state's approach differed. "This is not what New York City is doing, which is trying to jump start a new year," said Bob Kurtter, a vice president with Moody's Investors Service. "The primary objective (for New York state) is to manage cash throughout the year," he said, adding that the move does not reflect concerns that revenues will fall short. New York State's revenues were on target during the first four months of the 1997 fiscal year, the budget director said last week, adding the state collected about $2 billion in July, around $200 million more than a year-ago. Still, to the extent that New York also can identify areas where it can cut costs now, by acting early, the state also might be able to begin closing some its budget gaps, which the state comptroller says could hit $3 billion in 1998. "The fact of the matter is New York has gaps out there so it's a very good thing, a prudent thing, to start early," said Richard Raphael, an executive managing director with Fitch Investors Service. --Joan Gralla, 212-859-1654 2297 !GCAT !GODD !GPOL !GVOTE From the people who brought you hundreds of "yogic fliers" who claimed to defy nature by levitating comes The Natural Law Party, a minor political party that nominated a presidential candidate on Thursday. At a hotel convention here, the party associated with the Transcendental Meditation (TM) movement named physicist John Hagelin as its presidential nominee for the Nov. 5 election. The party is running on a platform claiming it can ward off problems before they occur through techniques such as mass meditation that would reduce stress, crime, terrorism and even wars. "Social stress can be reduced and problems such as crime and violence will automatically decrease," said a party paper. Many party members are practitioners of TM, which involves meditating to a repeated word or phrase, called a mantra. Some advanced TM followers contend they can actually mediate to such a point that they fly. But in a demonstration of "yogic flying" several years ago, critics said the people were merely bouncing off the ground from a sitting position. 2298 !C13 !CCAT !GCAT !GDIS Experts who studied the 1986 space shuttle Challenger explosion will test debris from TWA Flight 800 in the effort to determine whether a bomb or an accident caused the plane to explode, officials said on Thursday. The investigation is focused on the area around the Boeing 747's centre fuel tank, including its fuel pumps, a fuel control panel and probes used to measure fuel amounts, said Robert Francis, vice chairman of the National Transportation Safety Board, at a media briefing. The Paris-bound Boeing 747 exploded and crashed into the Atlantic Ocean off Long Island, New York, on July 17. All 230 passengers and crew on board were killed. Experts with the National Aeronautics and Space Administration who worked on the Challenger disaster will be testing the TWA debris at the Marshall Space Centre in Huntsville, Alabama, Francis said. "They want to see how these things were working," he said. "They're stripping them down, trying to find out anything they can about the possiblity of something malfunctioning." The cause of the Challenger explosion was found to be a failure of the seals, or O-rings, that joined rockets to the shuttle. The space shuttle exploded a minute after lift-off on January 28, 1986, killing all seven people on board. Investigators say so far there is no definitive evidence to indicate which one of the three leading theories -- a bomb, missile or mechanical failure -- caused the TWA jet to crash. The plane appears to have been rocked by an explosion in the centre fuel tank area, Francis said, adding it was not clear whether that was the primary explosion that brought the plane down or a secondary blast. Investigators also said all the wreckage in a debris field closest to Kennedy International Airport, where the plane took off, may be recovered by the end of this weekend. At that point, they said, searchers will begin using just one of the two U.S. Navy salvage ships that have been combing the crash scene. The USS Grasp will leave and the USS Grapple will remain at the scene. Another ship will use high-resolution side-scanning sonar to search the debris field again, they said. The wreckage lies in a mile-and-a-half-long (2.5 km) swathe on the bottom of the Atlantic Ocean. Recovery was still expected to take weeks, Francis said. Searchers have recovered just over half of the centre fuel tank, which is bent, burned and covered with soot, Francis said. The tank was carrying only about 50 gallons (190 litres) of jet fuel, investigators have said. Asked how to account for the fire damage around the tank given the small amount of fuel, Francis said, "That's what we're trying to find out. The bodies of 209 victims have been recovered. Of the 21 bodies that remain lost at sea, Francis said they were believed to have been sitting throughout the plane and not concentrated in a single area. He added, however, that the plane's seating chart may not be accurate. Passengers may have changed seats because the jet was half-empty and had been delayed on the ground about an hour before take-off, investigators have noted. 2299 !GCAT !GDIP The United States on Thursday denounced the reported jailing of 11 Burmese dissidents and called on Burma's military rulers to start a dialogue with the opposition. The opposition National League for Democracy (NLD) reported the seven-year sentences on Wednesday. It said those jailed included Win Htein, personal assistant to the party's Nobel Peace prize-winning leader, Aung San Suu Kyi. State Department spokesman Glyn Davies said Washington was concerned by the reports. "We view this as another in a series of oppressive actions by the regime to prevent Aung San Suu Kyi and her supporters from exercising their rights," he told reporters. Davies described as ominous recent actions by Burma's ruling State Law and Order Restoration Council (SLORC). "The SLORC has violated with impunity the human rights of the Burmese people," he said. "What remains to happen in Burma ... is that (the authorities) enter into a genuine dialogue with the National League for Democracy ... That is the key to reconciliation in that country," he added. Davies said the United States had not ruled out sanctions against Burma and continued to discuss firmer measures against the Rangoon government with regional powers including Japan, Thailand and Australia. Washington gained little support for such measures, however, at a meeting last month of the Association of Southeast Asian Nations (ASEAN). In a separate development, Davies said deputy assistant secretary of state Kent Wiedemann had been appointed new U.S. charge d'affaires in Burma and would take up his post in October. He succeeds Marilyn Meyers. 2300 !GCAT !GDIS !GENV Parched farming regions of southern Texas looked set to receive a much-needed dose of rain from Hurricane Dolly, but meteorologists said it may not be enough to relieve months of drought. Although Dolly has so far missed Texas and has battered Mexico's Yucatan Peninsula instead, it has spun off beneficial rains that fell Thursday throughout southern Texas. "The next three days or so will be probably be the wettest period that South Texas has seen all year," said Mike Palmerino, Weather Services Corp meteorologist. Palmerino said between 1/2 and 1-1/2 inches of rain fell Wednesday night in the area between Brownsville and Corpus Christi, and that another 3/4 to 2-1/2 inches could fall there over the next three days. This came as good news to people like Tommy Joe Crutch, a grain elevator manager in McAllen, Texas, who said some fields in his area had received no moisture since last November. "If Dolly was to come in, it would tickle everybody to death here -- at least the agriculture people," Crutch said. "That would just be ideal for us because not only do we need to replenish the moisture in our soil, we need to get water in our reservoirs for irrigation," he said. Ray Prewett, executive vice president of the Texas Vegetable Association in Mission, Texas, said the rains would provide temporary relief to the region's major crops -- citrus fruits, vegetables and sugar cane. But Prewett said the larger issue was whether the rains would replenish Amistad and Falcon international reservoirs, the two lakes on the U.S.-Mexico border that serve the water needs of the entire lower Rio Grande Valley. Prewett said months of drought had left the reservoirs at only about 25 percent of capacity, and that certain irrigation water districts were out of water. "It's not a solution to our overall irrigation water supply unless Dolly puts rainfall in the watershed of those two reservoirs," Prewett said. Of the state's agriculture community, at least one group was not exactly welcoming Dolly's rains. David Oefinger, executive director of the South Texas Cotton and Grain Association, in Victoria, Texas, said the rains would keep some cotton producers from harvesting. "This soaking rain is going to help the drought conditions and the pastures. The cattlemen and ranchers are real pleased with it, but right now we're trying to get the cotton in, and those folks aren't real happy," Oefinger said. Oefinger said most of the cotton between Corpus Christi and Victoria was cut before the rains arrived, but that the cotton harvest between Victoria and Houston would likely be delayed by rain. But the cotton harvest delays may not last long, according to WSC's Palmerino. "It looks like you could very easily go back into a drier pattern there next week," Palmerino said. --Kansas City bureau, 816 561-8671 2301 !GCAT !GDIP !GPOL The Cuban exile group Brothers to the Rescue said on Thursday it was planning to resume regular patrols of the Florida Straits on Saturday, six months after Cuban MiG fighters shot down two of its planes. The group, which has for years flown humanitarian missions searching for Cuban rafters in the waters between Florida and Communist-ruled Cuba, said it was resuming its flights because of calls from Cubans worried about the safety of relatives trying to flee the island. "We've received several calls in the last few weeks. We know that things are happening and we should be there," said Brothers to the Rescue founder Jose Basulto. A Brothers mission on Feb. 24 sparked an international incident when Cuban military planes shot down two of the group's unarmed civilian aircraft between Florida and Cuba, killing four people on board. Flights were suspended following the incident. The attack was condemned by the Clinton administration and other nations and sparked new tensions between the United States and Cuba, eventually leading to tighter U.S. economic sanctions against Cuba. Cuba said it was defending its territory, insisting the exile planes were inside Cuban airspace when they were shot down. It condemned Brothers to the Rescue and said the incident was the result of a long series of provocations by the group. An investigation by the Montreal-based International Civil Aviation Organisation concluded that the attack took place over international waters. Cuba rejected the ICAO report, saying it contained "fabrications." Basulto, who called the shootdown "an act of premeditated murder" by the Cuban government, said the new missions would be peaceful and the exile planes would stay in international airspace. "We have advocated non-violence since day one," he said. "We don't have any protection. We're simply in God's hands." He said the planes would be equipped with positioning devices that would send satellite signals back to the group's Miami headquarters where a record would be kept of their location at all times. Basulto, whose pilot's license was suspended after the Feb. 24 attack, said he would fly on the new missions as a passenger. The group, which said it has flown more than 1,800 search missions, planned to drop a wreath at the site of the shootdown during its first flight Saturday in memory of the victims. 2302 !GCAT !GDIP The United States said on Thursday it remained committed to migration accords with Cuba and would continue to repatriate intercepted Cuban migrants who attempted to enter U.S. territory illegally. A State Department statement appeared in part a response to Cuban complaints that Washington was jeopardising the accords by failing to return some of the Cubans involved in recent illegal migration incidents. "The United States reiterates its full commitment to the implementation" of the accords signed by the two countries in 1994 and 1995, said the statement by spokesman Glyn Davies. "The United States will continue to return Cuban migrants intercepted at sea who seek to enter the United States or the Guantanamo Naval Base illegally," it said. Washington would also take "prompt and effective law enforcement action" against alien smuggling and hijackings from Cuba, it added. Davies told reporters the statement would be distributed in the Cuban exile community in Miami "to remind everyone of the importance of abiding by the accords and avoiding dangerous attempts to cross the straits" from Cuba to Florida. Havana's complaints centred on an incident in which a boatload of emigrants capsized in the Florida Straits last week and two recent aircraft hijackings from Cuba. Sixteen of those picked up from the boat were returned to Cuba but eight were taken to the United States and three to Guantanamo Bay, a U.S. base on Cuba, until they emigrated to another nation. The most recent hijacking, last Friday, involved three hijackers and the pilot of a small aircraft. Davies said on Tuesday the pilot could soon return to Cuba but U.S. authorities planned to try the hijackers. In an incident on July 7, a Cuban interior ministry official hijacked a commercial plane and sought aylum at Guantanamo Bay. Davies said he knew of no plans to return the man to Cuba. 2303 !E21 !E211 !ECAT !GCAT !GPOL !GWELF In keeping with its pioneering image in the area of welfare, Wisconsin was the first state to submit an administrative plan under the nation's new welfare law, Gov. Tommy Thompson said Thursday. According to a new release from the governor, Wisconsin submitted a plan to the U.S. Department of Health and Human Services for administration of the new block grant system for welfare just minutes after President Bill Clinton signed the measure into law Thursday. "As the nation's leader in welfare reform, Wisconsin is far ahead of the curve and ready to go under this new system," Thompson said. Still, the governor said the new law does not go as far as the state's own welfare reform program, dubbed W-2. He said that despite the new law, Wisconsin will still require federal waivers allowing the working poor to acquire health care coverage from the state, a 60-day residency requirement for participation in the welfare program, and child support collections to go directly to custodial parents. The nation's new welfare reform law limits eligibility, gives states more power and ends direct federal aid for poor children. --Karen Pierog, 312-408-8647 2304 !E51 !E511 !ECAT !GCAT !GENV !GTOUR In an effort to attract more tourists, New York State said it planned to spend $32.3 million to preserve and develop its canal system. The program, which is expected to create 500 construction jobs, will be funded mainly through revenues that the canal system now produces and federal aid, the New York State Thruway Authority/Canal Corp said on Wednesday. The improvements that the Authority plans include developing 70 miles of trail along the Erie Canal and upgrading services for boaters, it said in prepared remarks. The state agency also will seek to create opportunities for public and private partnerships. --Joan Gralla, 212-859-1654 2305 !E21 !E211 !ECAT !GCAT !GPOL Tyler, Texas, the City of Roses, will soon become the city of lower property taxes as well, City Manager Ernest Clark said Thursday. Beginning October 1, property taxes will go down 15.2 percent, fulfilling a campaign promise of the city's new mayor, Kevin Eltife, Clark said. The tax cut was adopted Wednesday as part of the city's fiscal 1996-1997 budget. The city's fiscal year begins October 1. "(The Mayor) said that he thought the city could reduce its taxes by 15 percent, and he gave that challenge to the staff, and we responded," Clark said. Eltife was elected in May. The seven-member City Council consists of representatives elected from the six member districts and the mayor who is elected at large, he said. The cut means property owners will pay 43.7 cents per $100 of property value, down from $51.5 cents, Clark said. The city hopes to pay off all of its debt by 2003 or 2004. The city expects to cut property taxes further as its debt reduction plan progresses, he said. To help offset lost revenue, the city council voted in January to adopt a half-cent sales tax to be used for infrastructure improvements. While the city already has a one cent sales tax, the new half-cent tax is administered by a separate non-profit corporation appointed by the city council, the city manager said. "Normally, we would have to either sell bonds or certificates of obligation to make some major street repairs, now this money is available to do that," Clark said. "We are going to try to shift to a pay-as-you-go, rather borrow and pay back." While city council voted to adopt the sales tax in January, it took effect in April and the city received its first check in June. In fiscal 1996-1997, the council estimates the city will take in $6.75 million to $7 million additional dollars. The city has developed a 15-year infrastructure plan and the non-profit corporation board members and the city council members have been holding holding meetings to find out what residents thought of the plan and whether they thought other problems existed that should be addressed. The city is broken into six districts. While "there is always resistance to any kind of tax," Clark estimated that some 60 percent of the new sales tax revenue would be generated by shoppers residing outside of Tyler. "We are kind of a focal point for a number of outlying areas, and our population is somewhere between 80,000 and 85,000, but probably during the day time we may have 100,000 plus," Clark said. "So we estimated that when we were doing this study that probably somewhere around 60 percent of the sales tax is paid by nonresidents." Located in Northeast, Texas, Tyler is 90 miles east of Dallas and 90 west of Shreveport, La. --Kathie O'Donnell, 212-859-1655 2306 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Phelps Dodge Corp said it has presented its final labor contract offer to unionized employees at the company's Chino copper mine in New Mexico. A Phelps spokeswoman said the deal - revised since earlier in the week - was presented to the union negotiators on Thursday afternoon. "This is our final offer," she added. "The talks have officially adjourned and the unions have indicated they want some time to review these proposals," the Phelps spokeswoman said. The company has not given the union any deadline to come back to the bargaining table. The company's final offer, however, still sought a base pay freeze over a period ending on November 15, 2000 - indicating a contract over four years in length. The United Steelworkers of America, which represents most of the 670 unionized workers at Chino and is leading the negotiations, wanted a three-year deal with an hourly pay hike in each of the contract years. USWA officials were unavailable for comment. The previous three-year labor deal expired on June 30. The 170,000 tonnes per year contained copper mine is operating normally. The first of the two key pay changes Phelps made in Thursday's final offer was to raise from $300 to $500 the amount paid to each employee each year of the contract if the price of copper averaged at least 90 cents per pound over a year. The second change was to reinstate one of the two bonus price bands originally eliminated. In the previous wage deal employees began receiving bonuses if the price of copper averaged 80 cents or above over a quarterly period. Initially Phelps wanted the bonus in the new contract to kick in when copper was over 100 cents per pound, but in Thursday's final offer, bonuses would be paid when copper was 90 cents or above. A higher level of bonuses were also offered along with pension improvements, the Phelps spokeswoman said. -- New York Commodities 212-859-1646 2307 !E21 !E211 !ECAT !GCAT !GPOL !GVOTE Vermont Gov. Howard Dean, a Democrat, hopes that the state's voters in November will give his party control of the state senate, which could smooth the way towards enacting a new, state-wide property tax. "If we get a Democratic Senate, the governor is pretty sure we'll get property tax reform," said Stephanie Carter, the governor's press secretary, on Thursday. Vermont's elected officials run for state office every two years, and the House, which is controlled by Democrats, has approved property tax reform bills for the past two years, but the legislation has stalled in the Senate. The upper house now is controlled by Republicans, but Dean hopes that due to the unusually high number of senators who have chosen not to run, or to campaign for higher offices, the odds of the Democrats winning control have improved. While property tax reform is a campaign issue for Dean, no action would be taken on any new proposals he might make until the legislature, which has adjourned, convenes in January. The governor previously has supported bills that would set a base rate for all the state's 251 municipalities. Towns that did not need all the funds that were raised by the tax would turn them over to the state, which would distribute them to poorer cities, the press secretary explained. The issue is a contentious one because property taxes, which now are assessed locally, can vary sharply between neighboring towns, Carter said, saying such discrepencies can run as much as $2.00 per $100 of assessed value. --Joan Gralla, 212-859-1654 2308 !C17 !C24 !CCAT !GCAT !GENV The U.S. Energy Department on Friday awarded $5 million for six years to Niagara Mohawk Power Corp to grow willow trees as fuel for power plants to make electricity, an Energy Department spokeswoman said. Niagara Mohawk and New York State Electric and Gas are leading a consortium of more than 25 companies, power producers, farmers, associations, academic institutions, and regional government agencies in a $14 million project to produce willow trees as fuel for power plants in six years. The Salix Consortium expects to be able to produce 37-47 megawatts of electricity. By 2010, the group plans to have 40,000 to 60,000 acres of willows planted in central and western New York, to help power electricity sales worth about $135 million a year, according to the Energy Department. 2309 !GCAT !GWEA Temperatures in the U.S. Midwest should be normal to below normal next week though the region is expected to warm up by the Labor Day weekend, meteorologists said. Earlier forecasts had called for a cooler long-term outlook, but Weather Express Inc chief forecaster Fred Gesser said temperatures next weekend should be two to four degrees (Fahrenheit) above normal. The frontal system that brought 0.25 to 1.50 inches of rain to southeast Iowa and northwest Illinois on Thursday will move into the eastern Corn Belt on Friday. The rains should favor southern Illinois, Indiana and Ohio, with amounts of 0.50 to 1.00 inch and 60 percent coverage, Gesser said. "For the most part, it will be fair, dry, cooler and much less humid from Saturday through Monday," said Smith Barney meteorologist Jon Davis in his daily weather report. Another front should move in next Tuesday and Wednesday, but shouldn't bring as much rain as the current front, Davis said. Gesser said temperatures early next week should average about two to four degrees below normal, with lows in the low 50s and most highs in the low to mid-70s. Highs in the southern Corn Belt should reach into the low 80s. Temperatures should start rising by midweek, with highs in the mid 80s to lower 90s over the weekend, Davis said. --Alby Gallun 312-983-7294 2310 !C42 !CCAT !E14 !E141 !E41 !ECAT !GCAT !GJOB West Virginia's average annual wages rose to $23,489 in 1995, an increase of 2.4 percent over 1994, the state Bureau of Employment Programs said Friday. The report said mining and manufacturing workers are the highest paid, while retail trade employs the most workers. --Jane Sutton, 305-374-5013 2311 !C12 !C13 !C33 !CCAT !GCAT !GCRIM The Miami Sports and Exhibition Authority must honor an extended lease agreement with the Florida Panthers hockey team, a federal judge ruled. In his ruling late Thursday, U.S. District Judge K. Michael Moore gave the authority until 5 p.m. Friday to sign the lease agreement or be held in contempt of court. The authority had argued that the lease extension allowing the Panthers to play in the Miami Arena was invalid. Anticipating a move to a new city, the Panthers originally told the sports authority they would not exercise thier option to extend the lease into the 1996-97 season. After deciding to move to a new arena in Broward County that will not be finished for two more years, the team sought to extend its lease under the old contact. The arena authority said the whole lease had to be renegotiated and when the two sides failed to reach agreement on the terms, the Panthers sued to force the authority to honor the lease extension. Miami Mayor Joe Carollo, who sits on the sports authority board, said the ruling strips the authority of its rights and vowed to appeal. He said Moore's ruling was biased because the judge holds a season ticket for the Panthers. The lease negotiations were hampered by ill will caused when the Panthers decided to move to Broward County, while Dade County agreed to build a new facility for the Miami Arena's other tenant, the Miami Heat. Both new arenas are to be financed with revenue bonds. --Jane Sutton, 305-374-5013 2312 !GCAT !GCRIM !GHEA The husband of the Massachusetts woman who died last week in the presence of Dr. Jack Kervorkian owes the Internal Revenue Service up to $335,000, The Boston Herald reported on Friday. Dr. Franklin Curren, widower of Judith Curren, told the newspaper that his tax arrears were mostly due to the cost of caring for his late wife. The IRS placed a lien of $320,674 on Curren's property earlier this week on top of a $14,393 lien filed by the federal agency last year, the Herald said. "Her illness took its toll financially," Curren, a psychiatrist, told the newspaper. Neither Curren nor IRS officials could be reached for comment. 2313 !CCAT !GCAT !GDIS !GVIO The chief investigator of the crash of TWA flight 800 refused Friday to confirm a report in the New York Times that a trace of explosives has been found in the plane's wreckage. "I'm not going to comment at all on this report," Robert Francis of the National Transportation Safety Board said on NBC-TV's "Today" programme. The New York Times reported in Friday's edition that traces of PETN, a chemical in plastic explosives, had been found in pieces of the wreckage pulled from the Atlantic Ocean off Long Island. The newspaper cited as sources three senior officials deeply involved in the investigation who spoke on condition of anonymity. TWA's Flight 800 from New York to Paris exploded and crashed on July 17. All 230 passengers and crew aboard were killed. Francis said the NTSB and the FBI were still trying to determine if the explosion was caused by a bomb, a missile or mechanical failure. "We need more evidence," he said. 2314 !C12 !CCAT !GCAT !GCRIM A federal judge on Thursday delayed for one day a decision on whether to allow a reorganization of Lloyd's of London to go forward, but a lawyer in the case denied there were any negotiations going on to settle the matter out of court. U.S. District Judge Robert Payne was expected to rule on whether to issue an injunction blocking the financially strapped market's 3.2 billion British pounds ($4.8 billion) recovery plan, but decided to withold judgment until Friday. Chris Lyman, attorney at Kilpatrick and Cody, which represents investors who brought the lawsuit, said there were no settlement negotiations going on. "I don't think (the delay) bears any relation to the merits of the case or what the judge is deciding," he said. "The opinion is expected to be issued in the afternoon of Friday, Aug. 23," the federal court said in a one-sentence statement. The 93 investors, or Names -- individuals who pledged their assets to back the insurance policies sold at Lloyd's -- are seeking to block the reorganization plan, whereby Lloyd's would reinsure billions in liabilities by creating a new reinsurance company, Equitas. Under the plan, the investors are being asked to pay up to $150,000 each to help fund Equitas. The investors filed suit, claiming Lloyd's declined to provide detailed financial information about Equitas as required under U.S. securities laws. In an interview with Reuters in London, Lloyd's Chairman David Rowland said any injunction served against the insurance market by the judge in the Virginia case would be quickly appealed. Rowland added he did not believe the court case would block completion of the 300-year-old insurance market's recovery plan and said many U.S. investors have already accepted the terms of the recovery proposals. He declined to reveal how many of the 2,700 Names in the United States and 33,500 worldwide have accepted. Payne, who told the court during hearings earlier this week that he learned as a law student not to impose an injunction he could not enforce, indicated his concern that U.S. investors be adequately protected. He also scolded the Securities and Exchange Commission for not taking up the matter. Lloyd's chief executive, Ronald Sandler, admitted in court that the British Embassy had arranged a meeting in Washington between the SEC and Lloyd's officials prior to the court hearing. Sandler testified he wanted to make the SEC aware of the Aug. 28 deadline for Names to vote on acceptance of the recovery plan. "My particular purpose was to ensure the SEC understood we were dealing with a process in the reconstruction plan. I felt they needed to be aware of the time table," Sandler testified. In Washington, a spokesman for the SEC said the agency had no comment. Industry sources in London said that while the judge could grant some kind of relief to the U.S. Names, Payne said in court earlier this week that it was not his intention to stop Lloyd's worldwide recovery plan. 2315 !GCAT Airbus Industrie won a $900 million order from UAL Corp's United Airlines, fending off a competing bid from rival Boeing Co, The Wall Street Journal reported on Friday. The newspaper also reported: * Ford Motor Co sells USL Capital's Real Estate Financing mortgage to Bankers Trust for about $575 million. * Americast, owned by Walt Disney Co and four phone companies, agrees to buy at least three million digital set-top boxes for more than $1.0 billion from Zenith Electronics Corp. * President Bill Clinton is expected to announce curbs on tobacco sales on Friday. * Rate of corporate layoffs has dropped since the start of the 1990s but still is above that of a decade ago. * United Auto Workers breaks with tradition and may negotiate with each of the Big Three auto makers. * President Clinton signs welfare reform bill. * Initial claims for state unemployment insurance rise 6,000 to a level of 327,000 in the week ended August 17. * Japan, U.S. finalise agreement on loosening air cargo restrictions. * U.S. auto sales slipped 0.6 percent in August 11-20 period from year ago. * Mexico's Gruma SA de CV and Archer Daniels Midland Co form joint venture. -- New York newsroom, (212) 859-1610 2316 !GCAT !GDIS !GWEA Hurricane Dolly is a significant threat to shipping in the southwestern Gulf of Mexico, centred 180 miles east southeast of Tampico, moving west northwest at about 10 mph, Weather Services Corp said. Top winds continue at 75 mph. A hurricane warning is up for Mexico from Veracruz to La Pesca. Dolly is expected to make landfall in 6-12 hours with top winds of 80 mph. Heavy rains of 6-12 inches and locally heavier are expected likely, causing flooding and mudslides. Storm surge flooding of three to five feet above noraml tide levels is likely at and around the point of landfall, WSC added. 2317 !GCAT !GCRIM !GHEA Dr. Jack Kevorkian arrived at a hospital on Thursday with the second person he helped to die in nine hours and was arrested for disorderly conduct when police questioned him, police said. Sgt. Kenneth Lewis of the Pontiac Police Department said Kevorkian became abusive to officers outside the Pontiac Osteopathic Hospital, where he dropped off a man's body shortly after 9 p.m. EDT (0100 GMT Friday). Police said that Kavorkian was released without bond and that the case would be forwarded tor the Oakland County prosecutor for further consideration. Kavorkian's lawyer, Geoffrey Fieger, could not be reached for comment. Kevorkian is a strong advocate of doctor-assisted suicide, which is illegal, and has sharply stepped up the pace of helping people who are suffering from painful diseases die. He had brought the body of a 40-year-old Missouri woman to the hospital around midday Thursday. In the latest death, Lewis said: "He dropped one off. He was all by himself except for the dead guy, and officers got there just as Kevorkian was trying to leave." The officers tried to detain and question the retired pathologist, Lewis said, but Kevorkian "didn't want to cooperate." "He became pretty loud and abusive towards the officers; he was calling them Nazis, eventually pushed one of them in the chest and got to the point where he had to be arrested for being disorderly in a public place," Lewis said. Details of the most recent death, Kevorkian's fourth in the past week and 38th known case since 1990, were not immediately available. Doctors at Pontiac Osteopathic said the man was a white male, probably in his 60s, but Kevorkian was detained by police before he could give them any information. Earlier on Thursday, Kevorkian's attorney Fieger said the doctor was present at the death of Patricia Smith, a nurse from Lee's Summit, Mo., near Kansas City. Fieger said the woman suffered from "rapidly progressing multiple sclerosis." She also died in the presence of her father, James Poland, and her husband, David -- the first known police officer to attend the suicide of a Kevorkian patient. "Her husband loved her," Fieger said. "She was more important to him than the fact that somebody might say, 'You're a police officer and this is wrong.' It's not wrong." The latest deaths come less than a week after Kevorkian's involvement in the controversial Aug. 15 suicide of Judith Curren, a 42-year-old Pembroke, Mass., nurse who suffered from a non-fatal disease -- chronic fatigue syndrome -- and who had lodged abuse charges against her husband. Kevorkian was also present Tuesday night when Louise Siebens, 76, of McKinney, Texas, took her life to relieve her suffering from amyotrophic lateral sclerosis. Known as Lou Gehrig's disease. The illness is considered terminal. Fieger said Kevorkian was not trying to draw attention away from the Curren case. He said the pace of Kevorkian's suicide activity was irrelevant because he was helping people who were suffering. "It doesn't matter what happened yesterday or whether Dr. Kevorkian helped three people this week," Fieger said. Kevorkian brought Smith's body to Pontiac Osteopathic Hospital at about midday Thursday and told doctors that she had been paralysed by multiple sclerosis, said Dr. Robert Aranosian, the hospital's emergency room director. Kevorkian's frequent visits to the hospital have become routine, he said. 2318 !GCAT The New York Times reported the following stories on its front page on Friday: * Scientific evidence has been found that an explosive device detonated in cabin of Trans World Airlines jet that crashed over Atlantic ocean. * Calm facade of crash investigators has masked chaos, distrust and courage. * President Bill Clinton signs bill cutting welfare. * States are anxious about greater responsibility under welfare reform. * Top aide to Russian President Boris Yeltsin and Chechen rebels sign a peace pact. * American students continue to improve their Scholastic Aptitude Test scores. * The rate of corporate layoffs has fallen from the early 1990s but is still well above that of a decade ago. * Islamic religious leaders are helping bring some order to Somalia's chaos. -- New York newsroom, (212) 859-1610 2319 !GCAT !GDEF !GDIS Two more U.S. fighter planes crashed on Thursday and the Air Force combat command cancelled most operations on Friday to try and seek an explanation for the proliferation of disasters this year. A Marine reserve F/A-18 fighter attack plane crashed into the Atlantic on Thursday morning and the pilot was missing. Hours later an Air National Guard A-10 tankbuster crashed less than 100 miles (161 kms) away and the pilot was taken to a hospital. They were the latest in a series of crashes including one in Croatia that killed Commerce Secretary Ron Brown, four Navy F-14 crashes and helicopter crashes including a spectacular training collision. The Air Combat Command, which operates about a fourth of all Air Force planes, cancelled routine operations on Friday for a "Safety Day" and ordered units to examine every part of their operations to find out if anything was wrong and needed to be fixed. The move came after four crashes in the past month, including one of President Bill Clinton's support planes as it left Jackson Hole, Wyoming, after the Clintons' vacation there. "We must step back from the day-to-day pressures of the mission and spend a day identifying and quantifying the risks associated with everything that we do, then devising practical ways to mitigate those risks," the command's chief, Gen. Richard Hawley, said. The Navy and Marine Corps suspended operations earlier in the year for similar reviews. But officials say no common cause has been found for the crashes, not even the four F-14 crashes. In the worst incident, an F-14 smashed into a house in Nashville, Tennessee, killing both crewmen and three civilians inside. The Navy blamed the pilot, saying he may have taken off at too steep an angle to impress his parents. The Air Force passenger jet crash in Croatia that killed Brown and 34 other people, including a number of top U.S. business executives, was blamed on a deadly mix of errors. One was a failure by commanders to follow Air Force orders against landing at airports without approved landing aids. In the worst helicopter crash of the year, a two-man AH-1 Cobra attack helicopter collided with a troop-loaded CH-46 Sea Knight in darkness as they took part in joint exercises with British forces, at Camp Lejeune, North Carolina. Fourteen of the 16 Marines on the choppers were killed. 2320 !GCAT The Washington Post carried the following stories on its front page on August 23: --- WASHINGTON - President Clinton signs historic welfare legislation even as women's groups and advocates for the poor protest outside the White House. --- MOSCOW - As fierce fighting in Chechnya ended, a relatively robust looking Boris Yeltsin went on television to rebuke national security chief Alexander Lebed who brokered the shaky ceasefire. --- WASHINGTON - A D.C. Superior Court judge ruled that six city schools cannot open on time because fire code violations have not been repaired. --- WASHINGTON - An African-American woman who says two hairstylists at Bloomingdale's refused to serve her because she had "black hair" has filed a federal discrimination lawsuit. --- JOHANNESBURG - The ruling African National Congress admitted to South Africa's truth commission that it tortured and executed renegade militants in its war on apartheid. --- WASHINGTON - Humana Inc, one of the nation's largest health care corporations, is pulling out of the Washington area becuase of $30 million in losses this year. --- 2321 !GCAT The Washington Post carried the following business stories on August 23: --- WASHINGTON - American workers are losing jobs in company restructurings at a slower pace than in previous years, the Labor Department reported. --- WASHINGTON - The National Association of Securities Dealers (NASD) regulators go on-line to warn investors of cyberscams. --- WASHINGTON - The Internet Assigned Numbers Authority, which coordinates technical parameters for the global computer network, has decided to organise a competition for the right to operate new registries. --- WASHINGTON - The United Auto Workers union delayed naming a strike target in contract talks with Ford, Chrysler and General Motors, citing negotiating progress at all three companies. --- 2322 !GCAT !GCRIM The Haitian Coast Guard on Thursday made a major cocaine seizure aboard a fishing vessel in cooperation with U.S. Coast Guard authorities and arrested seven men, a U.S. Coast Guard official said. Lt. Cmdr. Marc Woodring said from Miami that a U.S. Coast Guard cutter, the Dallas, based in Charleston, S.C., had come across a Haitian registered ship in international waters on Monday and detected the presence of cocaine on board, although a quick search could not find any. The U.S. ship then put in a routine request with Haiti to seize the ship, but the newly formed Haitian Coast Guard requested that the ship be brought to Port-au-Prince instead. When the ship was towed there, the one-month old Haitain Coast Guard force searched the ship and on Thursday discovered 348 kilos (766 pounds) of cocaine on board, Woodring said. "The Haitian government arrested the seven people on baord and took six kilos as evidence," he said. "The remaining cocaine was put on our cutter and taken out to sea to be destroyed." He said that five of the men arrested were Jamaican, one was Haitian and another was from Ecuador. 2323 !GCAT !GENV !GTOUR Like an airborne traffic cop, Jim Hain flies above the Great South Channel shipping lane near Cape Cod, watching for near-collisions. He patrols from a U.S. Coast Guard helicopter to make sure ships in the area avoid colliding with 60-tonne North Atlantic right whales, once hunted to near-extinction and now the most endangered of the great whales. Only about 300 remain, and scientists said their numbers have been declining in the last three years. Collisions with ships and entanglement in fishing gear are believed to be the leading causes of death for the slow-moving black-and-gray mammals. "Rights are infrequently hit by ships. However, because of the low population and the low calving rate, it's an issue," said Hain, a biologist with the National Marine Fisheries Service in Woods Hole, Massachusetts. "We're trying to prevent an event that doesn't occur very often." The project is one of many cooperative ventures along the Atlantic coast to try to save the threatened species. Vessels searched fruitlessly off the coast of Massachusetts this month for a 50-tonne right whale that was seen entangled in fishing gear by a Gloucester, Massachusetts, whale-watching vessel. "Basically, we'll go anywhere in the North Atlantic to rescue a right whale. We believe each one is important for the species survival," said Peter Borrelli, executive director of the non-profit Centre for Coastal Studies based in Provincetown, Massachusetts. Six right whales have been found dead since the first of the year, at least two a result of ship collisions. This is an alarming number considering the small size of the whale population, said Charles Mayo, a senior scientist at the Centre for Coastal Studies whose father and grandfather once harpooned whales. "We have to assume for every one known to have died there have to be a number that are not known. This whale is right on the brink, probably because of a lot of early whaling." A thousand years ago, Basques began hunting the right whales -- so-called because their slow speed and high oil content made them the "right" whale to capture. By the time of the great whaling era in the first half of the 18th century, when the Massachusetts towns of Nantucket, New Bedford and Salem were the whaling capitals of the world, the right whale was already commercially extinct. Sixty years after hunting for whales was outlawed in U.S. waters in 1935, the protected continental shelf off Massachusetts has turned into fertile feeding grounds for many species of whales, spawning an estimated $20 million whale watching industry, said Brian MacDonald, co-founder of the Northeast Whale Watching Association. "(Massachusetts) has changed from a whaling state to a whale watching state," he said. At least 25 whale watching outfits in the U.S. Northeast take approximately 1.5 million people a year on cruises to see humpbacks, finbacks and minkes, but MacDonald said they steer clear of right whales. "The whale watching industry often works very closely with us to report whale entanglement," Mayo said. "I think they can be congratulated on being a central part of a story in the rescue of dozens of different types of whales." Scientists also suspect inbreeding along with pollutants and subtle climatic changes may be curtailing right whale reproduction rates, Scott Kraus, head of right whale research at the New England Aquarium in Boston, said. There is very little scientists can do about inbreeding or climatic changes, Hain said, but one difference they can make is warning vessels to steer clear of right whales. The Great South Channel, sandwiched between Nantucket Island and Georges Bank, is dense with plankton, the main food source for right whales. It is also the main waterway between Boston and Portland, Maine and the lower U.S. East Coast. Since the pilot project began in May, Hain said he has spotted right whales on many of his bi-weekly flights and radioed warnings to ships spotted in the area. He said navigational charts will soon be marked with the breeding and feeding grounds of right whales. "The monitoring flights alone won't solve the problem, but they're part of a multi-pronged approach," he said. "The other approach is the education of mariners." 2324 !GCAT !GENT !GPRO Herbie Hancock has always straddled musical worlds, dabbling in genres, creating new ones, mixing and melding pop and jazz in a way that causes his own sound to evolve. In his earliest hits from the '60s like the blues funk "Watermelon Man" or the brooding "Maiden Voyage," Hancock fused soul jazz and hard bop so successfully that bands are still dabbling with those classics today. He always reinvented, reworked and reinterpreted the music, following closely in the path of his onetime mentor -- Miles Davis. It is what Hancock is about, even if it causes some jazz critics to bite their nails. Now he is at it again. With his first acoustic jazz recording in years, the pianist has created what he titled "The New Standard" -- turning the compositions of Stevie Wonder, Peter Gabriel, Prince, Sade, and other popular composers into jazz tunes. Since the golden era of American song, jazz musicians have always mined popular song. One reason the Tin Pan Alley was such a rich lode for jazz was the harmonic complexity and catchy melodies of the tunes, something that was lost as popular music evolved. "Harmonically the music isn't as rich as it used to be many years ago, and a lot of melodies today really depend on the delivery of the vocalist. If it doesn't depend on that, then it depends on the words and if you just play it instrumentally that vitality is gone," Hancock said. "We had to do a lot of work reconstructing these compositions to make them sound as if they were written to be jazz tunes," he added. On the Verve CD, the approach shines on the opening cut. Don Henley's "New York Minute" projects an insistence and intensity enlivened by saxophonist Michael Brecker's cutting, metallic sound. Brecker, whose outing last year with pianist McCoy Tyner won a well-deserved Grammy, adds a fierce edge. Hancock plays vibrantly, applying his gift for melodic interpretation. With complex harmonies, he is like a painter who focuses intently on a shadow, only suggesting the beauty of the object that casts it. Peter Gabriel's "Mercy Street" also marks a high point on the disc, with percussive rhythms playing off against a warm and eerie melody, a perfect landscape for Hancock's musings. It takes a strong band for these reinterpretations to work but with Brecker, drummer DeJohnette, guitarist John Scofield, Dave Holland on bass and Don Alias on percussion, the affinity is electric. All the musicians, save Brecker, played with Miles Davis, which might explain their proclivity to take chances. Davis did it continuously. In fact, the continual urge to explore new ground is more than evident in the seminal Miles Davis band in which Hancock served as pianist. Just listen to "Miles Davis: The Complete Live at the Plugged Nickel 1965," which was released last year documenting an entire weekend of appearences by the band at the Chicago club. Hancock said the aim of those dates was to abstract Miles' tunes, to deconstruct standards and play outside convention. "We had said before we played the Plugged Nickel that we wanted to play anti-music -- in other words, whatever would be the expected response was the last thing we'd play," Hancock said. "Miles wasn't a part of the plan, but that was the kind of thing he encouraged. The aim was to destroy things and build them up again." It was the spontaneity that Hancock said he enjoyed, a sense of invention that was lacking in the studio dates that the band had with Davis. This urge to reconsider and reshape sound goes to the heart of Hancock's musical concept, even when it comes to his own tunes. Us3, for instance, the British acid jazz group, had a hit a couple of years ago with a unique dance-club version of Hancock's "Cantaloupe Island." Asked how he liked it, Hancock said: "It's great. In fact I think Us3 enhances the original. They only use two of the three chords in that song but big deal. They beefed up the bass line and rhythm and made it stronger than the original. When I play it live now, I try to play it like the Us3 version, but I use the third chord." 2325 !GCAT !GODD A Vietnamese man who tried to take a snooze in a railway boxcar in Canada found himself locked in and bound for Alaska with no food or water. Officials in the port of Whittier said on Thursday that they found Tuan Quac Phan, 29, dehydrated, famished and terrified after sailing to Alaska from Canada in the boxcar loaded on a barge, a trip that takes about five days. Sgt. Dan Jewell of the Whittier, Alaska police department described Phan as "extremely cooperative". "Seeing me in my uniform, he kept saying, Jail better. Jail better.'" Phan's accidental journey started last week in Prince Rupert, British Columbia, where he was searching for a fishing job, Jewell said. "He had climbed up in this boxcar to get out of the weather and to get some sleep," Jewell said. "The next thing you know, the boxcar is coupled up and loaded up to a barge and headed north." Police found Phan late on Monday when the boxcar, which was transporting lumber, was opened at Whittier, a port in western Prince William Sound. Officials fed Phan some soup, gave him medical care, kept him overnight and then fed him a large breakfast. 2326 !GCAT !GCRIM !GREL State and federal agents on Thursday sifted through the rubble of two predominantly black Arkansas churches that burned within minutes of one another late Tuesday and early Wednesday. Both churches were in the Mississippi delta region of Arkansas, about 90 miles (145 kms) southeast of Little Rock, and were located within three miles of one another. "We're investigating with the idea that both fires may be arson, but that hasn't been conclusively established," said Wayne Jordan, a spokesman for the Arkansas State Police. Agents of the F.B.I. and the Bureau of Alcohol, Tobacco and Firearms were also at the scene, Jordan said. Mount Zion Missionary Baptist Church and St. Matthews Missionary Baptist Church were both frame structures, each near Turner, Arkansas, a small community surrounded by cotton and soybean fields. "This is rural Arkansas. I'm surprised anyone could even find us out here," said Fannie Johnson, a member of St. Matthew's, who said she believed arson was to blame. Others connected with the two churches said they shared that suspicion, although all said they knew of no motive and no racial tension in the area. "It's sad someone would have that kind of spite in their heart," said Rev. Jerome Turner, pastor of Mount Zion Missionary Baptist Church. Arkansas has been spared the loss of predominantly black churches to arson, a wave that has claimed an estimated 30 houses of worship across the south in the past several months. A black church near Camden, Arkansas, about 100 miles (161 kms) south of Little Rock, burned in July, but federal agents have not determined the cause. 2327 !GCAT !GCRIM !GVIO The FBI is investigating whether proceeds from the sale of counterfeit T-shirts and sports apparel may have helped finance the 1993 bombing of New York's World Trade Centre, Business Week reported on Thursday. An article in its September 2 issue says the FBI has a list of some 20 alleged counterfeiters with suspected links to Sheikh Omar Abdel-Rahman, who was convicted by a Manhattan federal jury of being the spiritual leader of the group that carried out the bombing and planned other attacks. The cleric's lawyer denied any such links. Business Week said it obtained the information from an FBI agent and three other law-enforcement figures. It said that since the Feb. 26, 1993 bombing, which killed six and injured more than 1,000, the FBI's Joint Terrorist Task Force and the New York Police Department has raided New York City buildings it suspects counterfeiters used as warehouses and print shops. A recent raid yielded countefeit sportswear and a pistol hidden in an airconditioning duct, the article said. 2328 !C12 !C18 !C181 !CCAT !GCAT !GCRIM A federal judge in New York on Thursday imposed $2.6 million in penalties against a European-based group charged with insider trading in the $2 billion takeover by Praxair Inc of CBI Industries Inc last year, the Securities and Exchange Commission said. Judge Milton Pollack of the U.S. District Court in Manhnattan, entered the default judgment against the group, comprising seven firms and two individuals. In his order, Pollack required the defendants to return $1.4 million in illegal trading profits and pay more than $1.2 million in insider trading penalties. 2329 !C12 !C13 !CCAT !GCAT !GCRIM The Florida Supreme Court said Thursday that the statute of limitations for filing personal injury protection claims should be calculated beginning after an insurer fails to pay, not at the time of an accident, ruling against State Farm Mutual Automobile Insurance Co. In February 1989, State Farm denied personal injury protection claims to a couple whose daughter had died from injuries sustained in a December 1988 traffic accident in Miami. The couple filed a lawsuit in February 1994 demanding the benefits. State Farm moved to dismiss the case, saying the lawsuit was filed after the five-year statute of limitations had expired. A trial court agreed and dismissed the case. But an appeals court ruled the clock had begun ticking upon the breach of the contract, which it said occurred in February 1989. The Court ruled that the defining moment is when the insurer refuses to pay, differentiating from claims involving uninsured motorists' protection, which begin at the time of an accident. With its decision, the high court said it was attempting to stop confusion brought about by conflicting appellate court rulings over when the clock begins to tick on personal injury claims. A State Farm spokeswoman said the company did not have an immediate comment. 2330 !C13 !C21 !CCAT !GCAT !GDIS U.S. aviation officials proposed on Thursday to modify the flight control systems in popular Boeing 737 model airplanes that have suffered two unexplained crashes. "They are designed to make a safe plane safer," said Federal Aviation Administrator David Hinson, but none was of such urgency to require immediate action. FAA officials said the changes, some of which could cost airlines up to $5 million a plane, stemmed from a review of the aircraft prompted by the two 737 accidents. In both -- one near Pittsburgh in 1994 that killed 132 people and the other in Colarado Springs, Colorado, in 1991, that killed 25 people -- the planes veered off and crashed, leading investigators to suspect control problems. But the review team found the 737 in compliance with all FAA airworthiness requirements and uncovered no design flaws could have caused either accident. The FAA said, however, the review team made several recommendations for changes to give the crew improved control over the plane under certain conditions. It said that some modifications, to go into effect after a 60-day comment period, would only apply to older 737s, some to the newer models and others to the entire 737 fleet of 2,380 planes worldwide and 1,037 U.S. aircraft. Tom McSweeny, FAA director of aircraft certification services, said that with the plane's long and wide use -- more than 3,000 built and flown for more than 30 years, and with few accidents -- some areas could be found for improvement. "These changes seem like prudent things to do," he said, but added "We do not see any of them being in any way related to the cause of these two accidents." The agency said the various modifications of the flight control systems would go into effect in between three months and three years. McSweeny said two of the most important would be to the plane's yaw damper and its standby rudder. He said the FAA wanted parts of the yaw damper, which automatically moves the rudder slightly to try to prevent the plane from fishtailing, to be recoated to reduce corrosion. In both the Pittsburgh and Colorado Springs crashes, malfunctioning yaw dampers had been suspect, but the causes have not yet been been determined. 2331 !C12 !C16 !C18 !C181 !CCAT !GCAT !GCRIM Bonneville Pacific Corp said Portland General Corp would give up 7.8 million shares of Bonneville but keep two million as part of a settlement of a civil lawsuit. The company said in a statement late on Thursday the settlement would end the main legal action commenced by Bonneville's Chapter 11 bankruptcy trustees to recover millions of dollars in claimed damages. The settlement was filed in United States District Court in Utah. It is subject to approval by the District Court and the Bankruptcy Court. The settlement is with Portland General, its subsidiary Portland General Holdings Inc and certain past and present officers and directors of Portland. Portland asserted a multimillion-dollar claim arising out of Portland's alleged loans to and equity investments in Bonneville. Under the settlement Portland will drop any claims against Bonneville, its estate and related entities and individuals, except that Portland will retain ownership of two million shares of common stock of Bonneville. Portland will surrender ownership of about 7.84 million shares of Bonneville common stock and Portland will withdraw with prejudice its claim against Bonneville. In exchange, Portland will receive a release from Bonneville and its estate of all claims, including those asserted in the pending civil action against Portland and its current and former officers and directors. -- New York newsroom, (212) 859-1610 2332 !C13 !CCAT !GCAT !GHEA President Bill Clinton was set on Friday to announce a new series of restrictions on the sale and advertising of tobacco products in the biggest challenge to cigarette makers in over 30 years. White House officials, speaking on condition of anonymity, said Clinton would make the announcement during a midday Rose Garden ceremony attended by a number of anti-smoking, consumer and health groups. Clinton's aim is to stop what he considers the tobacco industry's attempts to coax young people into taking up the smoking habit. He would approve recommendations from the Food and Drug Administration that White House officials said closely parallel the proposals the president sent to the FDA for review last August. Under those proposals, cigarette companies would be barred from placing billboard advertising near schools and playgrounds. He also proposed to require age-verified and face-to-face sales and eliminate mail-order sales, vending machines, free samples, self-service displays and sales of fewer than 20 cigarettes. He also urged that sales or giveaways of caps or gym bags with tobacco company logos be prohibited, as well as brand-name sponsorship of sporting or entertainment events. White House officials said the new regulations will have some modifications to Clinton's proposals to reflect some of the comments the FDA heard during a review period. Nonetheless, this major set of restraints on the sale and advertising of tobacco products to minors will mark the first time that the federal government would have asserted jurisdiction over tobacco products. It is also the biggest government challenge to the tobacco industry since the 1964 Surgeon General's report that linked smoking to lung cancer. Tobacco companies, already facing assault on many fronts, have made clear they will fight the regulations in court by claiming the FDA does not have the authority to regulate nicotine. Republican presidential candidate Bob Dole's spokesman Nelson Warfield called the announcement an "election-year gimmick" that could delay a teen-smoking crackdown since lawsuits are already pending against Clinton's proposals. Clinton campaign spokesman Joe Lockhart fired back that Dole's criticism showed that he "seems more interested in protecting the tobacco lobby than protecting children." Dole had come under heavy criticism in June when he said tobacco was not necessarily addictive and that he did not believe the FDA has the authority to regulate nicotine. The union that represents most tobacco workers said the restrictions could cost thousands of jobs and eventually prompt tobacco companies to move operations out of America. The Freedom to Advertise Coalition, a group of advertising and publishing associations, said the regulations were overly broad and unconstitutional and poorly targeted. The White House on Thursday denied Republican charges that the announcement was timed to steer attention away from a government report that drug abuse among teen-agers has skyrocketed during his term. Republicans also charged that Clinton was timing the announcement to gain maximum publicity ahead of next week's Democratic National Convention. 2333 !GCAT !GWEA Tropical Storm Niki has been downgraded from a Typhoon as it made landfall over northern Vietnam. Niki will continue to dissipate over land over the next 12 hours. Heavy rains have likely caused flooding. High winds have likely caused wind damage. Heavy rains will linger over northern Vietnam and portions of Indochina over the next 6 hours as Niki dissipates further heightening flooding concerns and the possibility of mudslides. Niki is no longer a primary threat to shipping. Hurricane Dolly is centered 180 miles east southeast of Tampico, Mexico, moving west northwest at about 10 mph. Top winds continue at 75 mph. A hurricane warning is up for Mexico from Veracruz to La Pesca. Dolly is expected to make landfall in 6-12 hours with top winds of 80 mph. Dolly is a significant threat to shipping in the southwestern Gulf of Mexico. Heavy rains of 6-12 inches and locally heavier are expected likely causing flooding and mudslids. Storm surge flooding of 3 to 5 feet above noraml tide levels are likely at and around the point of landfall. Tropical Storm Edouard is in the open Atlantic about 800 miles west-southwest of the Cape Verde Islands, moving west at 14 mph. It has top winds of 50 mph and is expected to strengthen slightly during the next 24-36 hours while tracking to the west. This system only threatens shipping at this time. Tropical Storm Orson will be a moderate threat to shipping as it drifts over open waters from near 23n/143e to near 24n/143e during the next 48 hours while steadily intensifying. Orson will likely strengthen to typhoon status by 72 hours. This system will primarily be a threat to shipping this period. 2334 !GCAT Tom Cruise will reprise his roles as star and co-producer in the sequel to "Mission: Impossible," from Viacom Inc's Paramount Pictures, Daily Variety reported on Friday. Cruise will soon meet with William Goldman, who has been signed to write the screenplay. The picture was the studio's summer blockbuster, grossing $175 million domestically and $338 million worldwide so far. The newspaper also reported: * Having lost out on his services once before, Fox and News Corp chief Rupert Murdoch apparently wants former talk show star Arsenio Hall back, this time in a half-hour romantic comedy. * The 1996-97 TV season start is still about three weeks away, but the new race got under way Wednesday when Fox premiered "Beverly Hills, 90210" and "Party of Five" while the other networks are still for the most part in reruns. * Former "Late Show" producer Robert Morton said he's changed his mind about a consulting assignment to help revive "Caryl & Marilyn: Real Friends," a daytime talk show from Capital Cities/ABC Inc's ABC network. * Stephen Hopkins, who is putting the finishing touches on "Ghost in the Darkness" for Paramount, has signed to direct "Lost in Space" for New Line Cinema with a budget in the $60 million range. * For a number of reasons, including budget cuts and the proliferation of video and cable, college film programs have over the last decade favored third-run Hollywood blockbusters over foreign films and classics. * As part of the ongoing restructuring at Warner Brothers' Domestic Television Distribution's "Extra," about 10 members of the production staff have been let go since Aug 1. * BBC World, a 24-hour, English-language news network, became the first foreign channel to be launched on a terrestrial frequency in Europe on Thursday. -- New York newsroom, (212) 859-1610 2335 !GCAT The New York Times reported the following business stories on Friday: * United Auto Workers delays picking target of Big Three contract negotiations. * The $120 million contract for basketball player Shaquille O'Neal makes economic sense for the Los Angeles Lakers. * The recent rise in stocks is not a bull market until more investors jump in. * Germany's central bank cuts a principal short-term interest rate by more than expected. * Stocks rally on German rate cut. The Dow Jones Industrial Average climbs 43.65 to close at 5,733.47, and the Nasdaq composite index rises 17.12 to 1,143.96. * Many advertising executives support curbs on selling and marketing tobacco President Bill Clinton is expected to announce on Friday. * HSBC Holdings Plc's Marine Midland Bank agrees to buy the First Federal Savings and Loan Association Rochester from CT Financial Services for $620 million. * A federal judge in Virginia has delayed issuing a decision on a lawsuit filed by U.S. investors seeking to block a Lloyd's of London recovery plan. * Rate of corporate layoffs has dropped since the start of the 1990s but still is above that of a decade ago. * Howard Stein resigns as Dreyfus Corp chairman and chief executive. * Use of calcium channel blockers, which are widely prescribed for high blood pressure, has been tentatively linked to higher rates of cancer among older people. -- New York newsroom, (212) 859-1610 2336 !GCAT !GCRIM !GPOL California's state Senate approved controversial legislation on Thursday permitting the "chemical castration" of child molesters by injecting them regularly with a drug to reduce their sex drive. The Senate passed the measure by a vote of 25-to-1 and then sent it back to the state Assembly for its approval of certain amendments, one of which would allow doctors to refuse to perform the procedure. The Assembly, which had approved the measure without the amendments in May, was expected to act on the proposed adjustments by the end of the month. If signed into law, the California program would the first of its kind in the nation, according to the bill's author, Assemblyman Bill Hoge, a Republican. Gov. Pete Wilson's office indicated the governor would back the measure. "This is a measure that the Governor can support," a spokesman said. Civil rights and psychiatric groups blasted the proposal. "It's terrible," said American Civil Liberties Union (ACLU) lobbyist Valerie Small Navarro of the bill. "It's unconstitutional. The bill has no due process protections." She said ACLU attorneys were mulling legal action. The legislation mandates that an offender convicted twice of certain sex crimes be chemically castrated unless the felon voluntarily submits to surgical castration. Under the legislation, first time offenders may also be castrated at the discretion of the court. The child molesters would begin receiving chemical castration "treatments" one week before release from prison and would continue receiving the treatments while on parole. The cost would be $2,380 per parolee for biweekly injections of the drug Depo-Provera. Some of the side affects of taking the drug are diabetes and hypertension, opponents of the legislation said. The injections would dramatically reduce the sex drive of the offenders, thereby reducing the risk that they would commit new sex crimes against children, Hoge said. "Chemical castration has proved to be the most effective treatment available to treat sex offenders," Hoge said. "It's almost 100 percent effective." The legislation was inspired in large part by recent high-profile child molestation cases in the state. Hoge said he authored the bill at the behest of a conservative women's group in southern California. "We've had so many victims that have come forward on this legislation," Hoge said in an interview. "It gives them hope. It gives all of those that have been affected by the terrible crime of child molestation hope for the future." The state Department of Corrections estimates there are about 680 individuals on parole in California for the type of sex crimes specified in the legislation, including sodomy by force where the victim is under 13 years of age as well as certain cases of child molestation where foreign objects are used. 2337 !GCAT !GCRIM Belgian police using dogs trained to find bodies dug at two sites on Friday for evidence in a child-sex scandal that has set off a Europe-wide alert for paedophile gangs. A sixth suspect was reported under arrest in a widening probe that has uncovered two bodies and raised national alarm about the safety of children. The hunt for kidnapped youngsters, held in secret cells by adult perverts, has covered 11 houses although the main focus has been on one at Sars-La-Bouissiere in southern Belgium where Julie Lejeune and Melissa Russo were found dead at the weekend. "We started digging again today at Sars-La-Bouissiere and Marcinelles," Major Jean-Marie Boudin, spokesman for the Belgian Gendarmerie's special missing children squad, told Reuters. Marcinelles is a suburb of Charleroi where two other kidnapped young girls were rescued from a makeshift dungeon a week ago. Special radar-imaging equipment, used in Britain's "House of Horrors" serial killings case, was due to arrive in Belgium later on Friday, Boudin said. The two girls, kidnapped by a paedophile gang in June 1995 and who died of starvation early this year, were buried on Thursday in the eastern city of Liege amid national mourning. Convicted child rapist Marc Dutroux, who owns the house where the girls were found, led police to the bodies after being arrested for the abduction and illegal imprisonment of Laetitia Delhez and Sabine Dardenne who were rescued a week ago. Police are still searching for two other missing girls, An Marchal and Eefje Lambrecks, whom Dutroux admits kidnapping along with two accomplices last August. Boudin said a Belgian police officer had visited Bratislava to talk with Slovakian detectives about An and Eefje and other disappearances, and he planned to go also to Prague. No other overseas visits were planned, he added. Dutroux was known to have paid frequent visits to the Czech Republic and Slovakia. Dutroux and associate Michel Lelievre have been charged with abduction and illegal imprisonment of children. Dutroux' second wife Michelle Martin has been charged as an accomplice and Jean-Michel Nihoul with criminal association. Police arrested a fifth person, Michael Diakostavrianos, on Thursday. He is due to appear before magistrates on Tuesday. And Belga news agency said on Friday a sixth suspect Claude Thiraut had been arrested and would be charged next week with criminal association. Dutroux, an unemployed father of three, owns at least six houses. Underground cells and dungeons to hold kidnapped children have been found in some of them. In total police have searched 11 houses, removing quantities of video tapes and magazines as well as children's clothing and a gun. Boudin said there were plans to use the dogs followed by the radar-imaging equipment at all 11 sites. Le Soir newspaper said on Thursday that some of the seized tapes showed Dutroux sexually abusing children. At least 15 children have vanished in Belgium in the past six years. Seven have been found dead, six are still missing and two have been rescued. The deaths of Julie and Melissa have triggered calls for the reeinstatement of the death penalty or at least no early release for convicted child sex offenders. Dutroux was released 10 years early in 1992 for good behaviour from a 13-year sentence for multiple child rape. There has also been a national outcry over revelations of bungling -- and possibly worse -- by police during their 14-month search for Julie and Melissa, with police in one region failing to pass on information about Dutroux' activities to investigators in another searching for the two girls. Justice Minister Stefaan de Clerck has acknowledged mistakes were made and has promised a full inquiry including the possibility of disciplinary actions. 2338 !GCAT !GCRIM !GVIO Former Iranian president Abolhassan Banisadr told a Berlin court on Friday that an order to assassinate opposition Kurd leaders in Berlin in 1992 was personally signed by Iran's religious leader Ali Khamenei. On the second day of his testimony at the trial of five men accused of the murder, Banisadr also said he had learned two months before the attack took place of plans by Tehran to carry out an assassination abroad. The case has already strained ties between Iran and Germany, and the chief prosecutor at the trial said after Banisadr's testimony he would now examine the possibility of filing charges against Khamenei and Iranian President Akbar Hashemi Rafsanjani. But in Tehran, Iran's top judge urged Germany to refuse to admit Banisadr's testimony, to guard its judicial reputation and avoid politicising the trial. "What is the judicial validity of a ruling that would be based, even for a few hundredths of percent, on the testimony of a deposed person who has fled this country?" Ayatollah Mohammad Yazdi asked in a mass prayer sermon. One Iranian, Kazem Darabi, and four Lebanese are charged with murdering four exiled Iranian Kurdish leaders and their translator in Berlin's Mykonos restaurant in September 1992. The prosecution says Darabi hired the Lebanese on Tehran's orders to carry out the assassination. Iran denies involvement. Banisadr has been a sworn enemy of Iran's rulers since being ousted in 1981 and says he still has extensive sources of information within Iran's power structures. He said on Thursday that Khamenei ordered the killing. On Friday he said he had just learned that Khamenei signed a written order, although he still needed to corroborate this. "There was a written confirmation from Khamenei," he said. "The sources are reliable. You ask if they are in a position to have this information and the answer is yes. You ask if the information has proven to be accurate in the past, and the answer is yes." Prosecutor Bruno Jost said during a midday break outside the courtroom that he was satisfied Banisadr did in fact have specific information about the Mykonos attack. "The answers were as clear as one can expect from this witness," said Jost, who had complained that Banisadr's testimony on Thursday had been too vague. "One simply has to accept that he cannot say more about his sources." In March, German authorities issued an arrest warrant for Iran's Intelligence Minister, Ali Fallahiyan. Jost said that, based on Banisadr's testimony, prosecutors would examine the possibility of filing charges against Khamenei and Rafsanjani. But he added no concrete steps had yet been taken, and he was not sure it was possible under German law. The German government rejected a claim Banisadr made at a news conference on Thursday that Bonn had struck a deal with Iran to release the defendants ahead of time if they were convicted. "It is an absurd claim," the Bonn spokesman said. The trial is nearing its conclusion after 33 months. Speaking softly in his native Farsi, Banisadr told the court he had heard of a murder plan two months before the attack. "Later I received more precise information. Those people who were potential targets of the attack were warned," he said. He himself told a number of potential targets including two of the three Kurdish leaders who were later killed, he said. The testimony prompted several outbursts from Darabi. "He's not a witness, he's a politician!" he yelled from behind a bullet-proof glass screen. 2339 !GCAT !GCRIM Giovanni Brusca, once one of Sicily's most feared and ferocious Mafia bosses, has begun to testify against the Mob in what could be either a decisive breakthrough or a devious trick. Giancarlo Caselli, chief prosecutor in the Mafia stronghold of Palermo, confirmed on Friday that Brusca had talked to magistrates since making the decision last month. "We will see what the evaluation will be -- positive, negative or neutral," he said, adding that it was premature to say whether Brusca's evidence was genuine. Former justice minister Filippo Mancuso said that if Brusca had really gone over to the law "it could represent a major development in the fight against organised crime. "But if Brusca is being used, either by criminal organisations or others, then this will sow confusion and further insecurity, becoming a lethal weapon for the justice system and individual liberties." In what investigators saw as a likely act of Mafia intimidation, a car belonging to a cousin of Brusca was doused in petrol and set on fire overnight. A lawyer representing the 36-year-old mobster said his client had indicated he was prepared to reveal all about links with Italian politicians and institutions. "He has discussed general issues, painted an overview," said Luigi Li Gotti. "He will talk about links with politicians and institutions but he has not yet got down to specifics." Li Gotti quoted Brusca as saying the Sicilian Mafia was no longer a monolithic organisation. "He says that anything could happen now, Cosa Nostra is in difficulty and the families are divided," said Li Gotti. Tiziana Parenti, the former head of the parliamentary anti-Mafia commission, cast doubt on Brusca's motives. "This is a big snare. It shows we don't know anything about the Mafia if only months after an arrest a boss begins to talk," she said. Unlike other "pentiti", or turncoats, Brusca had intimate links to the heart of the Mafia and had been one of Italy's most wanted men until his arrest in Sicily in May. Publicly branded "a beast" by another turncoat whose 12-year-old son was allegedly strangled and disposed of in a vat of acid by the boss, Brusca has been charged with several high-profile crimes in Sicily and mainland Italy. Investigators say it was Brusca who pushed the button detonating a bomb under anti-Mafia magistrate Giovanni Falcone's motorcade on a motorway near Palermo in 1992. Falcone, his wife and three bodyguards died in the explosion. He is also accused of involvement in planning 1993 Mafia bombings against cultural monuments in Rome, Milan, and against the Uffizi art gallery in Florence. Rumours that a top Mafioso had become a "pentito", or turncoat, had been circulating for some time as police made a series of high-profile arrests in Sicily. Pino Arlacchi, a leftist senator and anti-Mafia expert, told the Corriere della Sera that Brusca's decision marked the end for the Corleonesi clan and could lead to boss of bosses Salvatore Riina deciding to give evidence as well. But Arlacchi also urged caution. "The Mafia is not yet beaten. For the moment, only the Corleonesi who have dominated Cosa Nostra for the past 20 years have been beaten," he said. 2340 !GCAT !GPOL !GVIO Police using batons and teargas stormed a Paris church on Friday and evicted 300 African migrants including 10 on a 50-day-old hunger strike, ending their protest against moves to expel them from France. The Saint-Bernard church bells sounded the alarm as hundreds of helmeted police moved in, struggling with sympathisers including media celebrities who had surrounded the church in recent days to back the Africans' demand for residence papers. Police broke down the church's main gate and burst through a barricade of chairs to remove the hunger strikers on stretchers and bundle the others, including some 100 children, into vans. Activists lay on the street in the path of the waiting vans, vainly trying to stop them from driving the protesters away. The raid, greeted with an outcry on the Left and plaudits on the Right, followed by a few hours Prime Minister Alain Juppe's announcement that none of the Africans was legally entitled to stay but he would review their cases individually on humanitarian grounds. Interior Minister Jean-Louis Debre said 30 to 40 percent of the protesters qualified for residence permits. Some were still under review, but others would be expelled. The hunger strikers were rushed to hospital and the other protesters were detained. The immigrant support group GISTI said two of the fasters refused treatment and had joined the other protesters in detention at Vincennes outside of Paris. The national airline Air France denied a trade union report that the Interior Ministry had already chartered flights to Zaire, Senegal and Mali -- home of most of the protesters -- for Saturday. The CFDT union at Air France called on airport personnel to oppose police should they try to fly the immigrants home. Chanting "French people, immigrants, solidarity", activists kept up their confrontation with police for hours in the heavily immigrant Goutte d'Or district, Juppe's former constituency, and called a protest march at 6 p.m. (1600 GMT). Radio reports said some people had blood on their faces. Debre said there were no injuries and "no serious incident". Police said 40 people were being held and six could be prosecuted for assaulting police. Witnesses said film beauty Emanuelle Beart was put in a police van but officials later said she had asked to follow the protesters and was not detained. She was outside the church having coffee when police moved in at 7.45 a.m. (0545 GMT), wrong-footing the protesters who had expected a police raid at 6 a.m., the earliest time police can enter a building under French law. Opposition Socialist Party spokesman Francois Hollande voiced shock. "We were close to a negotiated settlement that would have ended a fast endangering lives," he said. The fasters, who like the other protesters had been in the church since June 28, had been drinking sweet tea and taking vitamin pills, but two were said to be in a serious condition. Juppe had said France's highest administrative court, the Council of State, endorsed his view that the 300 Africans were not legally entitled to stay. But he pledged that families would not be broken up and ill individuals would not be expelled. Many of the protesters say they once had residence rights and were plunged into illegality by hardline 1993 immigration laws. Lawyers say loopholes in the laws, which also tightened conditions for citizenship, have created a legal nightmare. 2341 !GCAT !GCRIM Police using dogs trained to find bodies excavated at two sites on Friday for evidence in Belgium's child-sex scandal that has already produced two dead bodies and triggered a Europe-wide alert for paedophile gangs. The hunt for kidnapped children, held in secret cells by adults, has covered 11 houses although the main focus has been on one at Sars-La-Bouissiere in southern Belgium where Julie Lejeune and Melissa Russo were found dead at the weekend. "We started digging again today at Sars-La-Bouissiere and Marcinelles," Major Jean-Marie Boudin, spokesman for the Belgian Gendarmerie's special missing children squad, told Reuters. Marcinelles is a suburb of Charleroi where two other kidnapped young girls were rescued from a makeshift dungeon a week ago. Special radar-imaging equipment, used in Britain's "House of Horrors" serial killings case, was due to arrive in Belgium later on Friday, Boudin said. The two girls, kidnapped by a paedophile gang in June 1995 and who died of starvation early this year, were buried on Thursday in the eastern city of Liege amid national mourning. Convicted child rapist Marc Dutroux, who owns the house where the girls were found, led police to the bodies after being arrested for the abduction and illegal imprisonment of Laetitia Delhez and Sabine Dardenne who were rescued a week ago. Police are still searching for two other missing girls, An Marchal and Eefje Lambrecks, whom Dutroux admits kidnapping along with two accomplices last August. Boudin said a Belgian police officer had visited Bratislava to talk with Slovakian detectives about An and Eefje and other disappearances, and he planned to go also to Prague. No other overseas visits were planned, he added. Dutroux was known to have paid frequent visits to the Czech Republic and Slovakia. Dutroux and associate Michel Lelievre have been charged with abduction and illegal imprisonment of children. Dutroux' second wife Michelle Martin has been charged as an accomplice and Jean-Michel Nihoul with criminal association. Police arrested a fifth person, Michael Diakostavrianos, on Thursday. He is due to appear before magistrates on Tuesday. Dutroux, an unemployed father of three, owns at least six houses. Underground cells and dungeons to hold kidnapped children have been found in some of them. In total police have searched 11 houses, removing quantities of video tapes and magazines as well as childrens' clothing and a gun. Boudin said there were plans to use the dogs followed by the radar-imaging equipment at all 11 sites. Le Soir newspaper said on Thursday that some of the seized tapes showed Dutroux sexually abusing children. At least 15 children have vanished in Belgium in the past six years. Seven have been found dead, six are still missing and two have been rescued. The deaths of Julie and Melissa have triggered calls for the reeinstatement of the death penalty or at least no early release for convicted child sex offenders. Dutroux was released 10 years early in 1992 for good behaviour from a 13-year sentence for multiple child rape. There has also been a national outcry over revelations of bungling -- and possibly worse -- by police during their 14-month search for Julie and Melissa, with police in one region failing to pass on information about Dutroux' activities to investigators in another searching for the two girls. Justice Minister Stefaan de Clerck has acknowledged mistakes were made and has promised a full inquiry including the possibility of disciplinary actions. 2342 !GCAT !GVIO A home-made bomb exploded in a market in the district of Tipasa west of the Algerian capital Algiers on Friday, killing three women and two children, Algerian security forces said. Five people were injured, they added in a statement carried by the Algerian news agency APS. The security forces said they defused four other bombs in a raid immediately after the explosion. They added that a man carrying an explosive device died after it went off prematurely. "One of the criminals who planted the bombs was killed by a bomb he was carrying," Algerian radio quoted the security forces as saying. An estimated 50,000 Algerians and more than 110 foreigners have been killed in violence pitting Moslem rebels against government forces since early 1992, when the authorities cancelled a general election in which radical Islamists had taken a commanding lead. 2343 !GCAT !GVIO Police using batons and teargas stormed a Paris church on Friday and evicted 300 African migrants, including 10 on a 50-day-old hunger strike in protest against moves to expel them from France. The Saint-Bernard church bells sounded the alarm as hundreds of helmeted police moved in, struggling with sympathisers including media celebrities who had surrounded it for several days to back the Africans' demand for residence papers. Police broke down the church's main gate and burst through a barricade of chairs to remove the hunger strikers on stretchers. The raid, greeted with an outcry on the Left and plaudits on the Right, came after Prime Minister Alain Juppe refused to grant the protesters blanket permission to stay in the country but promised to review their cases individually. The protesters' spokeswoman Madjiguene Cisse said they were being taken to military hospitals in the Saint Mande and Clamart suburbs. Police said the other protesters were taken to a detention centre in the suburb of Vincennes. Activists lay on the street in the path of police vans, vainly trying to stop them driving the protesters away. The CFDT trade union at national airline Air France called on airport personnel to oppose police should they try to fly the immigrants home. Most are from Mali. Chanting "French people, immigrants, solidarity", activists kept confronting police for hours after the church was evacuated and called a protest march at 6 p.m. (1600 GMT). Police cordoned off the area in the heavily immigrant Goutte d'Or district, Juppe's former constituency. Radio reports said some people had blood on their faces, but police said no-one had been injured. Police said 40 people were being held and six would be prosecuted for assaulting police. Witnesses said film beauty Emanuelle Beart was taken to a police van but officials said she had requested to follow the protesters and was not detained. She was among several celebrities who had vowed to chain themselves to the Africans to prevent police from removing them. But she was outside the church having coffee when police moved in at 7.45 a.m. (0545 GMT), wrong-footing the protesters who had expected a police raid at 6 a.m. the earliest time police can enter a building under French law. "It is scandalous to break down a church gate and use violence against distressed people," said self-appointed mediator Stephane Hessel, a former French United Nations envoy. Opposition Socialist Party spokesman Francois Hollande voiced shock. "We were close to a negotiated settlement that would have ended a fast endangering lives," he said. The fasters, who like the other protesters have been in the church since June, have been drinking sweet tea and taking vitamin pills, but two are said to be in a serious condition. "They are not being taken to concentration camp, but to hospitals where they will surely feel better than at the church," said Michel Pericard, floor leader of the ruling RPR Gaullist party at the National Assembly. "The law is not to be negotiated but enforced," he said. The police raid came after Juppe announced on television on Thursday that France's highest administrative court, the Council of State, had endorsed his view that the 300 Africans were not legally entitled, as a group, to residence permits. But he said the government still intended to review their right to remain in France on a case-by-case basis and had no intention of using deportation to break up families or expel seriously ill individuals. Many of the protesters say they once had residence rights and were plunged into illegality by hardline 1993 immigration laws pushed through by then interior minister Charles Pasqua at a time of mounting anti-immigrant sentiment. Lawyers say loopholes in the laws, which also tightened conditions for citizenship, have created a legal nightmare. "If there are holes in the law, they must be filled up but the whole law cannot be called into question. Deputies who voted it knew what they were doing," Pericard said. 2344 !GCAT !GCRIM !GVIO Nazi-hunters in Germany let former SS captain Erich Priebke slip through their fingers more than 20 years ago in a bungled a war crimes investigation, a German prosecutor said on Friday. Prosecutor Hermann Weissing told Reuters by telephone that investigators had enough evidence at the time to convict Priebke, now 83, but failed to evaluate it properly. "Glaring mistakes were made and there were -- what I regard as -- inexplicable blunders in the investigation," Weissing, who is in charge of the archive department of a special Nazi crimes unit at the Federal Prosecutors' Office in Dortmund, said. After eight years of inaction, the investigation was shelved in 1971, Weissing, who was speaking from his office, said. In Rome on August 1 this year, an Italian military tribunal found Priebke guilty of "multiple murder" for his part in the massacre of 335 men and boys in the Ardeatine caves near Rome in 1944 -- the worst atrocity committed in Italy in World War Two. But it said it could not punish him because a 30-year statute of limitations on murder in Italy had run out. It also, in setting him free, cited mitigating circumstance because of his clean post-war record and and it did not accept that he acted with "premeditation and cruelty". His release prompted outraged protests in Italy and abroad. German justice officials then vowed to bring Priebke to justice and the German government is pressing for his extradition to Germany, where there is no statute of limitations on murder. It will be Germany's second try to bring him to book. Weissing said that "nothing had been been done to find Erich Priebke" from 1963 to 1971 during an official German investigation into the former SS captain. The television documentary programme "Panorama" broadcast on ARD German television on Thursday night said the German foreign ministry had confirmed Priebke had lived in Argentina under his real name during that time and since 1952 had renewed his passport regularly at the German consulate there. It also reported that Priebke had travelled as a tourist and had even returned to Germany on several occasions. It said the German police gave him a certificate of good conduct. German Nazi-hunters had enough evidence in Italian documents from the 1948 trial of his SS commander Herbert Kappler in Italy, Weissing said. "We had Kappler's verdict and other documents but these were never translated and somehow got shelved without being evaulated," Weissing said. The Italian court sentenced Kappler to life imprisonment. "The verdict would have shown that the killings were cruel and as a result would have been regarded as murder and not manslaughter (on Priebke's part)," Weissing told Reuters. Prosecutors decided that Priebke could only be charged with manslaughter and closed the investigation because the statue of limitations on that crime had run out in German law. Italian authorities rearrested Priebke hours after he was set free this month when Bonn said it would seek his extradition for trial in Germany. Priebke appealed against his rearrest and Italy said it could not extradite him with an appeal pending. Germany issued an arrest warrant for Priebke last year after he admitted taking part in the Ardeatine caves massacre -- the Nazi reprisal for a partisan bomb attack on German soldiers. In Germany he is wanted to face two counts of murder in the two cases where he has admitted to pulling the trigger himself. 2345 !GCAT !GDEF !GDIP The United Nations Security Council on Friday told Iraq to stop blocking arms inspectors searching for concealed weapons or materials. "The denial by Iraq, on repeated occasions, of immediate, unconditional and unrestricted access to the sites which they wished to inspect and the attempts made by the Government of Ireaq to impose conditions on the conduct of interviews with Iraq officials constitute a gross violations of its obligations," the council said in a statement read at a formal meeting. The statement was designed to bolster Rolf Ekeus, head of the U.N. Special Commission in charge of Iraqi disarmament, who is leaving for Baghdad on Friday to discuss the delays in inspections over the past few months. Ridding Iraq of its nuclear, chemical, biological and ballistic missile arms potential is a key requirement for lifting stringent trade sanctions imposed after Baghdad's troops invaded Kuwait in August 1990. The Security Council also has given inspectors the right to conduct surprise searches. The statement also warned Iraq that only full compliance with the weapons obligations will result in a favorable report to the council by Ekeus, leading to lifting to sanctions. It demanded "once again that they (inspectors) be given immediate, unconditional and unrestricted access to any and all areas (they ) wish to inspect." Iraq since June has balked at surprise inspections by arms experts searching for documents or other weapons-related materials, saying the U.N. teams were delving into sensitive national security sites the Special Commission had promised not to touch. Ekeus said that inspectors were delayed once again last week from entering a site where they suspected Iraq was storing banned materials. The equipment is often moved quickly when inspectors were about to arrive. "They are put on railway cars and trucks and made mobile," he said. "The site can be emptied if we cannot move without being hindered. " 2346 !GCAT !GCRIM !GPRO Trustees of the fortune belonging to 11-year-old Athina Onassis said on Friday they will fight in Greek courts against her French father Thierry Roussel, who has charged them with breach of faith. Athina is the last surviving member of the Onassis dynasty. Her grandfather Aristotle, who was once married to Jackie Kennedy, made a fortune in shipping and divided it between a foundation in his name and his only surviving child Christina. Christina, who divorced Roussel before her death in 1988, left her fortune to Athina and appointed a group of trustees from her father's foundation to look after the inheritance. "We claim nothing from Mr. Roussel," Onassis Foundation president Stelios Papadimitriou told a news conference. "But the name of the foundation is marred and this is unforgivable." The fight between Roussel and the group of trustees looking after Athina's fortune moved from the Swiss courts to Greek courts in May when the French businessman sued four leading foundation members for breach of faith. Roussel has sought to take charge of his daughter's money in Switzerland, saying he wanted to protect her interests. The dispute over the handling of the inheritance has been brewing for some time but the usually reserved trustees began to speak out this year during court battles against Roussel. "We are enraged," Papadimitriou said. "Mr. Roussel has nothing to do with us or the foundation and he is meddling in things he knows nothing about." Roussel could not be reached for comment. Athina's exact fortune has not been disclosed but it is estimated at $4.6 billion, complete with her own Greek island. The Greek court will now decide whether there are grounds for trying the case or whether charges should be dropped, Papadimitriou said. 2347 !GCAT !GCRIM Police have arrested a sixth person in the paedophile scandal that has rocked Belgium, the Belga news agency reported on Friday. It said Claude Thiraut was being held and would be formally charged with criminal association next week. There was no immediate official confirmation. Marc Dutroux and associate Michel Lelievre have been charged with abduction and illegal imprisonment of children. Dutroux's wife Michelle Martin has been charged as an accomplice and Jean-Michel Nihoul has been charged with criminal accociation. Police arrested a fifth person, Michael Diakostavrianos, on Thursday. He is due to appear before magistrates on Tuesday. The arrests follow the rescue a week ago of two kidnapped young girls from a makeshift dungeon in a house owned by Dutroux in the southern city of Charleroi, followed by the discovery of the bodies of two other abducted girls who had starved to death, and the stepped-up hunt for two more girls who Dutroux admitted kidnapping a year ago. The two dead girls, Julie Lejeune and Melissa Russo, were buried in what was virtually a state funeral in the eastern city of Liege on Thursday amid national mourning and calls for the return of the death penalty. 2348 !GCAT !GHEA Italians prefer home cooking to hamburgers and, despite a national love of tobacco and wine, are smoking and drinking less than ever before, the national statistics institute Istat said in a report on Friday. Its survey, carried out among 20,000 families, said 12 million Italians over the age of 14, equivalent to 25.1 percent of the population, were regular cigarette smokers against 13 million in 1991 and 14.5 million in 1983. Wine consumption was declining with 57.1 percent drinking it against 59.7 percent in 1983. Nearly a third of people in a land that produces wines like Barolo and Chianti said they never touched alcohol. Italians prefer old-fashioned home cooking to fast food, with 84 percent returning home for lunch, their main meal of the day. Just over 90 percent said they ate bread, pasta or rice every day while 83.3 percent had fruit. Almost half of those polled said they felt "in excellent condition." 2349 !GCAT !GCRIM Belgian police faced more questions on Friday over how they failed to save two eight-year-old victims of a convicted sex offender. One campaigner said sex gangs preying on children may have enjoyed high-level protection. Justice Minister Stefaan de Clerck admitted on Thursday that mistakes had been made in the past but said there was no proof of any conspiracy among officials. Eight-year-olds Julie Lejeune and Melissa Russo were found dead at the weekend, victims of a paedophile gang. Chief suspect Marc Dutroux led police to their bodies buried in his garden. Belgian police are already under fire after revelations that detectives in one region failed to pass on vital information to investigators in another. But politicians and campaigners are now asking if child sex traffickers were protected by those in higher positions. "It's clear that internationally - and we put Belgium in there with other countries - for sex trafficking in children to work...offenders have to have protection,...there must be political and financial support," Marie-France Botte, a prominent campaigner against paedophilia, told Belgian radio. "I can't believe that in view of all the mistakes there have been in the Julie and Melissa case that there was no (such) protection to let the system carry on as it did," she added. Botte, whose association works in Belgium and abroad -- particularly Cambodia and Thailand - said she had told De Clerck of her concerns. "It wouldn't be surprising to discover in coming months, or from the testimonies of children found alive that important people in Belgium and in Europe are implicated in the system." Dutroux has been charged with abducting two girls who were rescued from one of his houses a week ago and had been sexually abused. He has also admited kidnapping two other girls -- An Marchal and Eefje Lambrecks -- who are still missing. Four others have been arrested in connection with the case. Louis Michel, head of the francophone Liberal PRL party, said "thousands" of minors had disappeared since 1980 and quoted criminal statistics for 1995 which recorded 1,105 rapes in Belgium of which 536 were child rapes. "It looks more and more like there are real paedophile networks established in our country," he told the minister. De Clerck confirmed the authenticity of documents leaked to newspapers this week which showed police were told at the end of 1993 that Dutroux was constructing cells in one of his houses to hold kidnapped children prior to sending them overseas. The information was not passed on to police in another area investigating the disappearance of Lejeune and Russo in 1995. "There was information gathered by the police which was communicated to the public prosecutor's office in Charleroi, (which) did not lead to a written statement." De Clerck said. "...This information was not passed on by Charleroi to Liege, so there was a lack of...communication there where they knew very well Liege was looking at the Julie and Melissa dossier." he added. De Clerck also confirmed that during a search at one of Dutroux' houses in 1995 investigators heard childrens' cries but after a fruitless search concluded they were of children playing outside. There was nothing to prove these were in fact Julie and Melissa, however. De Clerck has promised a full inquiry into the investigation including the possibility of disciplinary action. 2350 !GCAT !GODD A French tabby cat survived for a month trapped in the rubble of a building demolished by an explosion in the Mediterranean port of Marseille, drinking only rainwater, a vet said on Friday. The female cat, aged about 10, was extremely weak. "Cats have a great capacity for survival," vet Sophie Boudon told France 3 television. The cat, one of its back legs bandaged, lay on the table beside her. The cat, trapped when a gas leak destroyed a block of flats on July 20 in Marseille, was uncovered this week. It survived only on rainwater trickling through the wreckage. 2351 !E21 !E211 !ECAT !GCAT !GPOL French Prime Minister Alain Juppe and President Jacques Chirac meet in a riviera fortress at the weekend to try to cut spending in the 1997 budget while producing tax cuts and holding the labour unions at bay. They have the tough task of finalising a package which must curb public deficits to qualify for European monetary union and deliver on promises of income tax cuts as unions try to talk up a wave of public resistance. The budget is expected to be unveiled on September 18 but there is little sign so far of the economic growth that the government needs to help balance the books, economists say. At the same time, an almost palpable bad mood is likely to descend on the country after the mass holiday exodus of August. Several union leaders have already talked of protest after the August break. But many experts are cautious about predicting a repeat of the social unrest and strikes that cripplied the country late last year in response to austerity measure and welfare reforms. Many of the main lines of the 1997 budget are already known. Juppe said this month central government spending would be no higher than in 1996 at 1.552 trillion francs ($305 billion), which implies cuts of at least 60 billion francs because of inflation and other automatic spending rises. The government has identified where about half of this will come from, including scrapping job creation incentives judged to be inefficient and 7,000 civil service job cuts. Where the balance of the cuts will fall is not yet clear. Finance Minister Jean Arthuis has said he will deliver tax reductions effective from next year after a pledge by Chirac in July -- likely to be one of the major points discussed at the presidential summer residence at Bregancon. A figure of 20 billion francs has been floated for income tax cuts in 1997, although recent media reports say it is more likely to be in the region of 15 billion francs. Finding a formula for tax cuts -- after around 120 billion francs worth of tax rises in the last budget -- may require considerable juggling because of the strain on revenues, the big question mark in this year's budget equation. The economy has yet to prove that it will make the rebound on which Juppe is counting in the second half of this year. Economists say this will be critical if it is to find the revenues to underpin even stagnant spending. Some are already talking of another "mini-budget" to make sure France gets its 1997 deficit to the level which the European Union's Maastricht treaty sets for transition to a single currency in 1999. "Everybody knows there's going to have to be a mini-budget later in the year," said Paul Horne, economist with investment bank Smith Barney. However, he expects the economy to start looking better with possible further cuts in interest rates around budget time. On Thursday, Arthuis said he expected economic growth in 1997 of 2.25 to 2.5 percent, revising his earlier assumption that the economy would expand by 2.5 to 2.8 percent. Earlier this month Juppe reiterated his determination that France would get its deficit down to three percent of gross domestic product next year, in line with Maastricht terms, from a target of four percent this year. He will be pleased at least to have seen the independent central bank cut interest rates on Thursday -- trimming the key intervention rate to 3.35 percent from 3.55 -- in the hope that cheaper credit will help boost morale and the economy. ($1=5.079 French Franc) 2352 !GCAT !GCRIM Former Mafia boss Giovanni Brusca's decision to collaborate with Italian magistrates could be devastating to the Mob if his "revelations" are genuine and not meant to throw investigators off course, experts said on Friday. "Magistrates must always show caution when such 'eminent' figures such as Brusca adopt attitudes like this," said PierLuigi Vigna, a Florence magistrate. Brusca was the Mafia's top fugitive before his arrest in May. Nearly 1,000 former Mafia members have turned state's evidence but critics have said magistrates too willingly believe turncoats, who may have ulterior motives for their testimony. "This is a big snare," said Tiziana Parenti, former president of the parliamentary anti-Mafia commission. "It puzzles me. It shows that we don't know anything about the Mafia if only months after an arrest a boss begins to talk." Italy has for years debated the trustworthiness of once-bloodthirsty mobsters who swore religious allegiance to an organisation committed to fighting the state. Prime Minister Romano Prodi said he was confident that the highly experienced magistrates handling Brusca would be able to "distinguish between who is telling the truth and who is faking". If Brusca's "repentance" is sincere and total, he would be the most important informer to turn state's evidence since Tommaso Buscetta, a Mafia boss who began collaborating with magistrates in 1984 and is now a free man. An elaborate U.S.-style witness protection programme programme offers Mafia informers reduced sentences, secret safe houses, protection for them and their families, a salary and the chance to change identity and start a new life. It also includes the possibility of plastic surgery. A contract commits a turncoat to answer all magistrates' questions truthfully. He is not allowed any contacts with the outside world unless they have been cleared by magistrates. Officials said Brusca had not yet been admitted into the programme and one newspaper questioned whether that would be possible, given the magnitude of his crimes. Brusca, one of the Sicilian Mob's most brutal members in a violent organisation, headed the crime group after the 1993 arrest of "superboss" Salvatore Riina. He was a top lieutenant during Riina's reign over the Corleonese clan. He could help solve many crimes and shed light on the murky links between the Mob and politics. Pino Arlacchi, a leftist MP and leading Mafia expert, said he believed Brusca decided to talk because the Corleonese clan had been decimated by spate of arrests. Arlacchi said now there was nothing to hold back the 70-year-old Riina himself from collaborating with justice since all he has before him is a life in jail. As with all major turncoats, magistrates say they will handle Brusca warily, checking and double checking his affirmations for corroborating evidence. Francesco La Licata, a Mafia expert, said that while some magistrates were euphoric, others feared Brusca could even be part of a "strategic plot" by Cosa Nostra. Some turncoats have been accused of halfheartedly collaborating with magistrates in order to gain benefits provided by the witness protection programme. Former prime minister Giulio Andreotti, on trial for alleged Mafia collusion, is highly critical of turncoats and says accusations against him are part of an elaborate Mafia plot to punish him for crackdowns by governments he headed. 2353 !GCAT !GCRIM !GPOL The French government traded an image-loss abroad for domestic political gain on Friday by a police raid on 300 Africans protesting against an increasingly rigid immigration policy. In ordering a crackdown likely to mar France's reputation as a cradle of human rights, the government focused more on bolstering its conservative credentials ahead of 1998 general elections. The anti-immigrant far right is threatening to make major gains in these polls, political analysts said. "This morning we have seen the dignity of France. Thank you very much," said an African woman, one of the 300 holed up in a Paris church for the past two months in hopes of remaining legally in France, as police dragged her to a waiting van. Later Interior Minister Jean-Louis Debre said about one-third of the the 300 would be allowed to stay in France. Activists, labour leaders and opposition politicians rushed to condemn the decision to storm the church and drag out the immigrants, including 10 on the 50th day of a hunger strike. The Information and Support Group for Immigrant Workers (GISTI) called for a minute of silence "in memory of democracy". "Domestically, it seems that points of friction and conflict will inevitably multiply. Overseas, the image of our country will long be tarnished," it said. But Renaud Muselier, a senior official of the ruling RPR party, said the raid was long overdue. "The images broadcast around the world should serve as a lesson to others considering illegal immigration," he said. "Foreigners in France are not at home, but in our home," RPR deputy Bernard Carayon said. "They have no right to residency, much less a right to challenge our democratic institutions." Prime Minister Alain Juppe, ironically a former deputy from the Goutte d'Or neighbourhood where the Saint-Bernard church stands, had repeatedly insisted that he was merely obeying the law in deporting people not entitled to legal residency. He said he would never use expulsions to break up a family or deport someone who was seriously ill. But the protesting Africans nonetheless accused the Juppe government of making an example of them because it fears inroads by the fiercely anti-immigrant National Front in the general elections two years away. The night before the raid, the Front had taunted Juppe for using words instead of actions in hopes of ending the protest. Following the raid, the Front congratulated him for "adopting the attitude we have strongly advised him to take". "It is a shame that it took seven weeks for the decision to act, as the National Front would have taken action in 24 hours," Front official Bruno Gollnisch said. The government had found itself between a rock and a hard place in dealing with the protest. The Africans' plight had dominated the news during the quiet summer holiday season, and the government's hardening stance against illegal immigration had threatened to become a volatile issue on the Left even before the raid was called. Union leaders have threatened new protests -- and perhaps fresh strikes -- in September and October in protest at feared public sector job losses and budget cuts. France is still shaking from a wave of strikes prompted by a government austerity drive which paralysed France last winter. Yet the same labour unions expressing sympathy for the Africans have been hammering on the government's door for months for a solution to persistent unemployment, which has worsened since President Jacques Chirac took office in May 1995 though he had made jobs his top priority. In groping for a coherent policy on immigration, France has found itself in the same boat as other industrial powers who eagerly recruited foreign workers during better economic times, only to encounter a rising tide of voter rage when unemployment later soared, along with the cost of public services like health care and education. 2354 !E21 !E211 !ECAT !GCAT !GPOL The Italian government will start work on the 1997 budget next week and will present it to parliament by the traditional end of September deadline, Prime Minister Romano Prodi said on Friday. "We will certainly respect the deadline and we might even have it ready a few days early, but this doesn't really matter," Prodi told reporters after meeting the speaker of the lower house of parliament. "The problem is to present the single aspects of the budget in a studied, clear manner," he said. Prodi said he had already had talks with Treasury Minister Carlo Azeglio Ciampi over the budget, which the government has said will cut 32.4 trillion lire off next year's budget deficit. "We aim to complete (the budget) rapidly and try to have the smoothest discussions possible," he told reporters. The budget package has to be approved by parliament by the end of year. -- Rome newsroom +396 6782501 2355 !C13 !CCAT !G15 !G153 !GCAT German farmers want aid from national and EU funds for the ailing beef sector and a reduction in beef imports from eastern European. "The beef market suffers catastropic conditions because of the mad cow crisis and needs fast and effective help," farm union DBV said on Friday, in a statement issued ahead of a September 16-17 EU Farm Council and an informal farm ministers meeting on Sept 22-24. The BSE crisis had reduced beef consumption by 15 percent, prices had collapsed, and the EU now had a 1.2 million tonne beef surplus, DBV said. Imports from eastern Europe had put further pressure on markets. It supported an EU Commission rescue package which envisaged lowering current slaughter weight limits to allow EU intervention schemes to be extended to younger animals. But it rejected extra incentives offered for extensive beef production. DBV said German farm minister Jochen Borchert had pledged to propose reducing eastern European calf imports by paying exporters in the region compensation. DBV rejected EU plans to fund beef aid via cuts in farm compensation payments elsewhere and called on Bonn to offer farmers additional national aid. --Vera Eckert, Hamburg newsroom +49-40-41903275 2356 !G15 !G158 !GCAT !GDIP !GVIO The European Union said on Friday it remained deeply concerned over the situation in Chechnya, particularly the plight of the civilian population. In a statement issued on behalf of the 15-nation bloc, the Irish government, which currently holds the EU's rotating Presidency, said it deplored the rising number of attacks on civilians in the past week and called on both sides to ensure that people could return to their homes and remain in safety. The EU welcomed reports that negotiations had been resumed and urged Russia and Chechen separatist rebels to desist from any further military action. "The European Union reiterates its firm belief that negotiations are the only means of reaching a lasting political settlement to the situation in Chechnya, based on the respect of all concerned for human rights and fundamental freedoms." A ceasefire is due to come into effect in Chechnya on Friday after Moscow peacemaker Alexander Lebed and rebel chief-of-staff Aslan Maskhadov struck a peace deal on Thursday. The two sides are expected to form joint patrols to protect the devastated regional capital Grozny against looters. Tens of thousands of people have died in Chechnya since Mosco sent troops to quell an independence bid by the region, which Moscow wants to remain part of the Russian Federation. 2357 !G15 !GCAT Following are highlights of the midday briefing by the European Commission on Friday: Commission spokesman Thierry Daman said in response to a question that the Commission was checking a report in The Guardian on Friday that Britain had evaded EU rules to stop the spread of bovine spongiform encephalopathy (BSE) to the continent (see upcoming MADCOW-BRITAIN). - - - - The Commission released the following documents: IP/96/801: Commission approves the creation of GrantRail - a British Steel/Volker Stevin joint venture for railway construction and maintenance. IP/96/802: Commission clears the joint acquisition of InfraLeuna by Linde and Domo. 2358 !C17 !CCAT !G15 !G157 !GCAT European Competition Commissioner Karel Van Miert said on Friday a row between the European Union and Germany over aid to German car maker Volkswagen AG had still to be resolved. "I don't think you can say we were able to overcome the problems today," Van Miert told a news conference after meeting German Economic Affairs Minister Guenter Rexrodt. The row over public aid to VW erupted last month when premier Kurt Biedenkopf of the eastern state of Saxony overrode Commission objections to the size of the aid package and paid out extra funds. Biedenkopf, a Christian Democrat (CDU) ally of Chancellor Helmut Kohl, warned the state stood to lose thousands of jobs in the towns of Mosel and Chemnitz if it did not pay. Rexrodt said after the meeting the European Commission and Germany will in the next few days try to reach a "pragmatic" solution to the row over the public aid to Volkswagen. "I think this is one success of our meeting today," Rexrodt told a news conference. "We have agreed that in the next few days we shall be trying to come to a pragmatic settlement for the VW case in the present situation," Rexrodt added. He said such a solution may allow for the Commission to withdraw the case it is bringing to the European Court of Justice. Rexrodt said the situation in former east Germany could not be compared to the situation in any other member state. VW had suspended plans to develop plants in the two towns after the EU executive in June rejected 241 million marks ($161.7 million) of the total promised aid package of some 780 million. Van Miert reacted furiously to Saxony's defiant move, saying the decision to pay 91 million marks in unauthorised support to VW could touch off an EU "subsidy war" if left unchallenged. He threatened to block other aid to Europe's largest carmaker or excluding it from public tenders. Bonn has said it accepts Saxony's arguments but it believes the state went too far by defying the order from Brussels. 2359 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Two of Germany's leading construction industry associations on Friday urged other employer groups not to veto a new minimum wage proposal for the sector. In a joint statement, the Hauptverband der Deutschen Bauindustrie and the Zentralverband des Deutschen Baugewerbes said the adoption of the minimum wage had become more urgent in recent months. The BDA employers federation, the umbrella organisation for Germany's various industry groups, had vetoed a provisional deal struck in April for an 18.60 mark minimum wage in west Germany and 17.11 marks for east Germany. The construction associations said an influx of low-paying foreign firms had led to a loss of around 130,000 jobs in the industry in the first five months of the year. June unemployment in the sector was 186,500, about a third higher than in the year-ago period. The associations estimated there were about 200,000 foreign building workers employed by low-paying foreign firms in Germany. "A generally binding minimum wage ... could at least slow down further employment losses," the statement said. Construction union IG Bau earlier announced it had reached agreement with employers on a new minimum hourly wage of 17 marks in west Germany and 15.65 marks in the eastern states, which it hoped would be accepted as generally binding. --Frankfurt Newsroom, +49 69 756525 2360 !GCAT !GPOL !GVOTE Greek President Costis Stephnopoulos signed a decree on Thursday ordering the dissolution of the 300-seat parliament ahead of snap elections on September 22. "The President of the Republic Costis Stephanopoulos signed the decree for the dissolution of parliament," a presidency statement said. Socialist Prime Minister Costas Simitis announced the snap poll on Thursday citing problems with the economy, the country's convergence with the European Union and tense relations with neighbouring Turkey. Elections were originally scheduled to be held in October next year. 2361 !C21 !CCAT !G15 !G153 !GCAT !M14 !M141 !MCAT European Commission officials are estimating this year's grain harvest around 190 million tonnes, member country officials said on Thursday. The figure was given as an indication to Thursday's cereals management committee meeting in Brussels but harvest estimates may be discussed in greater detail next week, they said. An EU official told Reuters separately the crop was likely to be at least 190 million tonnes following promising yield improvements in northern France and a bumper southern crop. In June, an EU advisory committee pegged the harvest at 185-187 million tonnes, compared with 174 million in 1995. German grain trader Alfred Toepfer on Friday pegged the 1996 EU grain crop at 187-190 million tonnes, compared with a 187-188 million tonne estimate in July. Last year's grain crop was 175 million tonnes, it said. Toepfer said in a newsletter that high yield results now allowed for a higher harvest estimate but the current forecast was based on normal weather patterns. French grains analyst Strategie Grains currently has the highest estimate of 193.7 million tonnes, but its 1995 crop estimate is also higher at 176.6 million. Those figures were published on August 15. 2362 !GCAT !GCRIM !GVIO Former Iranian president Abolhassan Banisadr told a Berlin court on Friday that he knew two months before a deadly attack on Kurdish opposition leaders in the city that an assassination was being planned from Iran. "If I remember right, two months before the attack I got information that a murder was being planned for somewhere abroad," Banisadr told the court trying five men for the 1992 killing of exiled Iranian Kurd leaders in a Berlin restaurant. Banisadr, a sworn enemy of Tehran's rulers after being ousted in 1981, told the court on Thursday that Iran's religious leader Ayatollah Ali Khamenei had ordered the killings, backing up the prosecution's argument that Tehran was responsible. "Later I received more precise information," said Banisadr, who says he still has extensive sources of information within Iran's power structures. "Those people who were potential targets of the attack were warned," he added. Banisadr said he was able to warn a number of potential targets through different channels, including two of the three Kurdish leaders who were gunned down at the Mykonos restaurant together with their translator. The testimony prompted several outbursts from Kazem Darabi, an Iranian who prosecutors say organised the killing on Tehran's orders and enlisted the four Lebanese who are on trial with him. "He's not a witness, he's a politician!" Darabi yelled from behind a bullet-proof glass screen protecting him and the other defendants in the high-security courtroom. Security has been tightened even further for Banisadr because of fears he could be targeted. Some spectators in the public gallery yelled back at Darabi, and he complained loudly to the judge. "It's not right, people are insulting me. I can't ask questions but they can insult me." Tehran has consistently denied all involvement in the assassinations. But German authorities have issued an arrest warrant for Intelligence Minister Ali Fallahiyan in connection with the killings. 2363 !GCAT These are leading stories in Friday's afternoon daily Le Monde, dated Aug 24. FRONT PAGE -- Authorities use force to evict 300 Africans on hunger strike from Paris church. They were there in 50-day protest to renew or obtain work and residence permits. Charter flight said ready to fly some of the Africans out of the country on Saturday morning. -- French and German governments pleased with interest rate cuts but franc still vulnerable due to weak growth and potential for social unrest. BUSINESS PAGES -- Airbus picks up $900 million order from United Airlines. -- Bank of France declines to say at what time it learnt of Thursday's German interest rate cut. -- Paris Newsroom +33 1 4221 5381 2364 !GCAT !GDIP !GVIO Interior Minister Jean-Louis Debre said about a third of some 300 African immigrants evicted from a Paris church on Friday will be allowed to stay in France. He told reporters that the personal or family situation of "30 to 40 percent" of them met the government's criteria to grant them residence permits. Debre said some other protesters had already been served expulsion orders which he said would be enforced. He was looking into the case of an unspecified number of other protesters, and those among them who were not entitled to stay "will have to leave the country soooner or later." Union sources at national airline Air France said a government-chartered flight was due to leave on Saturday for Mali, home of most of the protesters. Debre said police had evacuated the Saint-Bernard church, where the protesters had been holed up for weeks, without any major incident and no-one had been injured. 2365 !GCAT !GPOL !GVOTE Greece's socialist Prime Minister Costas Simitis asked president Costis Stephanopolous on Friday to dissolve parliament and formally declare a snap election on September 22. "Greece cannot wait, we must move ahead with big strides," Simitis, a soft-spoken technocrat riding a wave of popularity, told the president. Simitis, 60, has shown that his mild manner masks a strong political will since succeeding his political mentor and socialist party founder, the late Andreas Papandreou, in January. Analysts said his decision to call early elections while he enjoys an approval rating of 70 percent, and before he has to draft a tough and unpopular budget, is likely to ensure his party's reelection and give him a free hand to push through drastic economic reforms. "We don't need small steps but leaps ahead," he told reporters after a cabinet meeting on Thursday. "I consider that only a government with a public mandate can deal effectively with the challenges of the 21st century." He cited a list of reasons for the snap poll, including a pressing need for Greece to catch up with its European Union partners, the need to reform the country's economic and social structure and the need to strengthen the government's hand in dealing with arch-rival Turkey. Opposition parties strongly attacked him for going back on his word that he would not call early elections and for using national issues like Turkey as an excuse to go to the country. "One thing is for sure. This election is not called for national reasons," main opposition New Democracy leader Miltiadis Evert said. "The truth is this election aims to cover up the economic problems created by his government." Simitis, a staunch pro-European, has made it clear his top priority is to bring the EU's weakest economy closer to the targets of the Maastricht Treaty on European integration. "Our country must take all necessary measures and decisions so that it does not become marginalised in the European Union's political and economic integration," he added. A ballooning public debt and persistently high inflation are top problems for Greece's economic ministers, who are preparing a tough 1997 budget. It includes cuts of $1.2 billion in state spending and a restructuring of public companies to boost growth, expected to exceed 2.5 percent of Greek GDP this year. Greek markets, which support the premier's economic plan, rejoiced at the news of an early poll, with the Athens Stock Exchange general index rising by about 5.5 percent in the past week. The premier's low-key style will also be evident during the pre-election period. Hardly anyone expects the mass rallies and long countryside tours that marked campaigns by his flamboyant predecessor. Discussions of political and economic issues on television are expected to dominate the campaign. "These will be the most quietest elections in modern Greek history," a government official said. "No big rallies, no plastic flags, no false promises." 2366 !GCAT !GVIO A home-made bomb exploded in a market in the district of Tipasa west of the Algerian capital Algiers, killing three women and two children, Algerian security forces said on Friday. Five people were injured, they added. The security forces said they defused four other bombs in a raid immediately after the explosion. They added that a man carrying an explosive device died after it went off prematurely. 2367 !C13 !C18 !C181 !CCAT !G15 !G152 !GCAT The European Commission said on Friday it had cleared the joint acquisition of InfraLeuna Infrastruktur-Und Service by Germany's Linde and Caprolactam Leuna, a subsidiary of Belgium's DOMO-Group. 2368 !GCAT !GCRIM A Libyan man has been found stabbed to death in Malta, police said on Friday. They said the body of Amer Hishem Ali Mohammed, 23, was found in a pool of blood in Sliema, seven km (four miles) from Valletta, on Wednesday morning. He appeared to have been killed on Tuesday night, suffering at least eight stab wounds. Police Commissioner George Grech said police were investigating the possibility that Mohammed had links to an Islamic militant group as reported by the local press. "What we know is that he was a fervant religious man, we cannot exclude anything in investigations" he said. 2369 !C21 !CCAT !G15 !G153 !GCAT !M14 !M141 !MCAT European Union 1996/97 molasses production should be around 4.2 million tonnes, down from 4.3 million in the 95/96 season, trader Alfred C. Toepfer said in a monthly newsletter. The EU consumes roughly twice that volume and relies on imports for the remainder. Molasses is the syrup remaining after sugar separated by crystallisation is removed during refining. --Hamburg newsroom +49-40-41903275 2370 !C31 !C312 !CCAT !G15 !G153 !G158 !GCAT !M14 !M141 !MCAT United States peach growers are angry that European Union fruit and vegetables marketing reform will harm exports estimated at $40 to $50 million annually, U.S. farm officials said. Californian growers are concerned that Greek and other EU peach producers will still benefit from generous subsidies and withdrawals of market surpluses and processing aid. The reform, which was agreed by EU farm ministers on July 24, was aimed at raising production quality and to make fruit and vegetable growers more dependent on the market and less on public intervention stores. EU Farm Commissioner Franz Fischler said afterwards that the reform would make EU growers more competitive. "To continue to spend huge amounts of money on the destruction of surplus fruit and vegetables without any long term structural or competitive benefit to the sector would have been foolish...," he said. But the Commission's proposals to reduce the attractiveness of the fruit and vegetable withdrawal system were softened after strong opposition from souther member states, notably Italy and Spain. 2371 !C12 !C31 !C312 !CCAT !E51 !E512 !ECAT !GCAT !GCRIM !GDEF Austrian state police are investigating whether domestic companies were involved in exporting chemical weapons-making technology to Libya, the Interior Ministry said on Friday. The news came after Germany revealed this week that 3.2 million marks ($2.15 million) worth of high-tech equipment to mix poison gases was sent to Libya from Germany between 1990 and 1993 in defiance of national arms control laws. "The Austrian state police is in contact with German authorities and is exchanging information with them to examine whether Austrian firms were also involved in this case," Interior Ministry spokesman Rudolf Gollia told Reuters. U.S. officials accuse Libya of trying to build an underground chemical weapons plant near Tarhuna, 65 km (40 miles) southeast of the capital Tripoli. Washington has made a major issue out of the alleged plant and has raised the prospect of possible military action. Gollia declined to say whether Austria had launched a full-scale inquiry and did not specify what measures authorities had taken so far. "But the contact with the German state police is active," he said. Libya strongly denies the U.S. allegations, but says Arabs had a right to own poison gas and germ warfare weapons to compensate for Israel's possession of banned arms. The government of Muammar Gaddafi failed in 1993 to sign a United Nations chemical weapons ban. It also refused to sign the nuclear Non-Proliferation Treaty designed to stop the spread of atomic weapons. Austrian companies may export to and invest in Libya, but they face constraints through U.N. resolutions limiting business deals with the northern African state. In 1991 the United Nations slapped an air and limited trade embargo on Libya after the country refused to extradite two Libyans suspected of blowing up a Pan Am airliner over Lockerbie, Scotland, in 1988. Austrian companies are also subject to European Union legislation, which requires so-called dual-use technology, which can be used for peaceful and military means, to be approved by the authorities. 2372 !C31 !C312 !CCAT !G15 !G153 !G158 !GCAT !M14 !M141 !MCAT The latest European Union figures show grain export commitments of the new 1996/97 (July/June) campaign between July 1 and August 20 were 62 percent below their year-ago level, member country officials said on Friday. The figures, based on delivered export certificates, showed grain sales plunged to 1.675 million tonnes from 4.382 million. Commercial wheat exports, which are still subject to an export tax, fell to 277,000 tonnes from 1.930 million, but heavy export commitments to China had boosted wheat export figures at the start of the previous 1995/96 campaign. Flour export commitments, however, reached 845,000 tonnes against 761,000 during the same period last year. Commercial barley exports fell to 206,000 tonnes from 632,000. Since August 20, the EU has granted 155,350 tonnes of soft wheat, 37,277 tonnes of barley, 1,500 tonnes of rye and 2,000 tonnes of oats through its weekly grain tender system. --Paris newsroom +331 4221 5432 2373 !C24 !CCAT !GCAT !GWEA Rain continues to delay the end of the grain harvest in northern France but record wheat yields are now forecast for the Nord-Pas de Calais region, crop analysts said on Friday. Harvest work is 80 percent complete but scattered showers and thunderstorms have kept farmers away from the fields over the last two days and more rain is forecast over the weekend. The coastal region, which consistently turns in France's highest wheat yields, could hit a record 10 tonnes per hectare for 1996 against last year's 8.1 tonnes, an analyst for the local ONIC grain office said. France's average national wheat yield for 1995 was 6.6 tonnes per hectare. "It is obviously a good crop with record wheat yields," the analyst said, referring to Nord-Pas de Calais. ONIC expects the soft wheat area there to rise to 280,000 hectares in 1996 from 270,000 hectares last year. Winter barley yields are pegged at 8.0-8.5 tonnes per hectare against 7.2 tonnes, while spring barley yields may reach 7.5 tonnes against 6.7 tonnes last year. Details about quality were still scarce but rain has hurt specific weight, the analyst said. "Specific weight was 82 kilos per hectolitre before the rain. It is now 76 kilos," he said. This led some farmers to cut part of their wheat before it was fully matured, raising concern over possible quality loss. But the region's wheat production is mainly destined to the animal feed industry and is thus less concerned with quality criteria set by French millers for bread-making wheat. --Dominique Vidalon, Paris newsroom +331 4221 5432 2374 !E12 !ECAT !G15 !G154 !GCAT Economists' comments after the Bank of Finland followed the Bundesbank with a cut in its key tender rate on Friday: OKOBANK Treasury economist Teijo Rantatupa: "This was a clear sign that Finland is part of Europe and trends in Europe. It was a very good move." Asked if the rate cut signalled that Finland was in earnest moving towards closer convergence with core European countries in the run-up to EMU, he said: "This is it." "I'm surprised the markka did not fall more, only half a penni." The current environment in Finland, as in many other European countries hoping to join EMU was marked by "tight fiscal policy and loose monetary policy," Rantatupa said. "Finland is ahead of most of Europe in the business cycle and it is possible that we will be leading the way by perhaps being the first to hike rates next year." Jukka Lepomaki, Merita Bank: Asked if the Bank of Finland had been led by Buba: "I don't believe that has been the motivation. The main motivation was that there is no inflationary pressure and the Bank of Finland has been criticised for too tight monetary policy." "I think (this cut) might be the last one, but the interesting thing is at least I see no reason to hike rates until next summer, so March and June FRA rates could come down significantly. (June FRAs fell to arounf 4.24 percent from 4.33 percent before the cut). Lepomaki said speculation about an imminent ERM linkage is being fuelled by employers anxious to pressurise the Bank of Finland into ensuring the markka does not link to ERM at too strong a level. @ "I had expected a cut of 10-15 (bps), but Buba moved more aggressively which increased the size of the Finnish cut." "My personal expectation is that (a markka-ERM link) will come by end-September. When (Prime Minister Paavo) Lipponen said 'in the near future' I think it's a question of weeks, not months." Handelsbanken Finland chief economist Carlo Erakallio: "We said it would be foolish of the Bank of Finland not to use the opportunity created by the Bundesbank rate cut to lower the tender rate by 25 basis points." "This was very widely expected. It was as discounted as a rate cut could be." "I do not see an imminent ERM link, I don't expect one until late October-Novemer. In my ERM world, there is still room to lower the tender rate," he said. Asked whether there could be room for another rate cut even if the markka were linked to the ERM within a few weeks, he said: "Fundamentally, there should be no pressure for the markka to weaken. I think there could be room for (monetary) easing after a fixing," he said. -- Helsinki newsroom +35 80 6805 0247 2375 !C17 !CCAT !E51 !ECAT !G15 !G157 !GCAT European Competition Commissioner Karel Van Miert and German Economics Minister Guenter Rexrodt held talks on Friday to try and defuse a row over public aid to carmaker Volkswagen. Asked what outcome he expected from the talks, Rexrodt told reporters as he arrived to the meeting: "A good result." He said there would be a press conference after the meeting, which started at around 1030 (0830 GMT). It was unclear how long the talks would continue. The dispute, which has spurred anti-EU sentiment in Germany, erupted last month when premier Kurt Biedenkopf of the eastern German state of Saxony overrode Commission objections to the size of an aid package for VW and paid out extra funds. Biedenkopf, a Christian Democrat (CDU) ally of Chancellor Helmut Kohl, warned that the state stood to lose thousands of jobs in the towns of Mosel and Chemnitz if it did not pay. VW had suspended plans to develop plants in the two towns after the European Union executive in June rejected 241 million ($161.7 million) of the total promised aid package of some 780 million marks. Van Miert reacted furiously to Saxony's defiant move, saying the decision to pay 91 million marks in unauthorised support to VW could touch off an EU "subsidy war" if left unchallenged. He threatened in a recent German magazine interview that Brussels could raise the stakes by blocking other aid to Europe's largest carmaker or excluding it from public tenders. Bonn has said it accepts Saxony's arguments that the payouts are justified but that it believes the state went too far by defying the order from Brussels. According to Brussels, Saxony paid out 142 million marks to VW after the Commission's June decision. Of this amount, it says 91 million was unauthorised. In total, Volkswagen has received at least 522 million marks from Saxony, which struggles with a jobless rate of more than 15 percent despite rapid economic growth. REUTER 2376 !GCAT The following are the main stories from Friday morning's German newspapers: FRANKFURTER ALLGEMEINE ZEITUNG - Former Iranian prime minister Banisadr accuses Tehran of state terrorism at Berlin trial - American Nazi apologist Gary Lauck gets four-year sentence for distributing Nazi propaganda in Germany - Bundesbank cuts securities repurchase rate by 30 basis points to three percent - Economics ministry expects year-on-year growth around one percent for second quarter 1996 - Government "micro-census" finds leap in proportion of population working in service sector to over 60 percent HANDELSBLATT - Bundesbank cuts securities repurchase rate by 30 basis points to three percent - President of engineering employers' federation Gesamtmetal says employers likely to demand cuts in pay and conditions in this year's pay round - Siemens to build coal-fired power station in China - BASF expects record profit and sales in 1996 - Hochtief expects satisfactory result for 1996 - Retail workers struggle with employers over bonus payments for working longer hours - Kirch group and Spain's Telefonica negotiate on digital television cooperation in Spain - Legal confrontation between city of Leipzig and RWE goes to higher court - Ifo institute study says German companies much more innovative than in supposedly more competitive Britain SUEDDEUTSCHE ZEITUNG - Former Iranian prime minister Banisadr criticises Bonn at Berlin trial for doing deals with Tehran. - German population ageing, "micro-census" shows - American Nazi apologist Gary Lauck gets four-year sentence for distributing Nazi propaganda in Germany - Bundesbank surprises markets by cutting third leading interest rate to record level - Leftists in opposition SPD produce own tax model - Almost all carmakers boost sales in July - German industry more innovative than others, study says - Cinemas expect boom DIE WELT - Bundesbank cuts third leading interest rate to 3.0 percent - Former Iranian prime minister Banisadr says Tehran responsible for 1992 murder of Iranian exile leaders in Berlin - American Nazi apologist Gary Lauck gets four-year sentence for distributing Nazi propaganda in Germany - President of engineering employers' federation Gesamtmetal says employers likely to demand cuts in pay and conditions in this year's pay round - Retail workers struggle with employers over bonuses for working longer hours; workers in Mecklenburg-Vorpommern state to stage warning strikes - Volkswagen boosts market share as Germany's top car supplier - Economics ministry expects year-on-year growth around one percent for second quarter 1996 - Ifo institute study says German companies much more innovative than in supposedly more competitive Britain -- Bonn Newsroom +49 228 2609760 2377 !GCAT AUSTRIA DIE PRESSE - Defence Minister Werner Fasslabend is launching a new pro-NATO initiative and planning to open an office for strategic studies. The office is to be led by a Freedom Party politician. - The Austrian National Bank followed the Bundesbank's lead and cut the repo rate to 3.0 percent, effective September 2, establishing parity with Germany again. - A telecom consortium composed of regional electricity companies, Verbund and the national railways OeBB is looking for an international operator. Global One and Unisource are under consideration. DER STANDARD - Media giant Mediaprint may face payments of millions of schillings after the high court ruled its newspaper street sellers were not self-employed but company employees. The company now has to pay past and future employment tax and social insurance for the street sellers. - The state is looking into possible links between Austrian companies and a Libyan poison gas plant. - Energieversorgung Niederoesterreich (EVN) and Hungary's MOL said they were building a joint venture power plant in Hungary. - Austria's electronics industry is feeling the pinch due to competition from eastern Europe. KURIER - Finance Minister Viktor Klima said the budget would hold for 1996, with a deficit of about 89 billion schillings. Whether the budget for 1997 can hold depends on the economic cycle, he said. - OMV said it wanted to play an active role in the upcoming privatisation of regional electricity companies. Company head Richard Schenz said OMV was interested in a stake in the Upper Austrian OKA and Energieholding Steiermark. - Austria's textile industry is worried it may lose state contracts. Some 1,000 jobs are at risk. SALZBURGER NACHRICHTEN - Chancellor Franz Vranitzky will travel to Israel and meet with Prime Minister Benyamin Netanyahu on September 1. He is also due to meet Palestinian leader Yasser Arafat in Gaza. CZECH REPUBLIC HOSPODARSKE NOVINY - "Anheuser-Busch's demands are unrealistic and we are not in a situation where we would have to privatise this firm," Agriculture Minister Josef Lux said. - Shoe production is now at half of 1989 levels. For the first time since 1989, imports of shoes are exceeding exports. MLADA FRONTA DNES - The American Federal Bureau of Investigations (FBI) is sending an agent to Prague by the end of this year to help Czech police in the fight against organized crime and international terrorism. - Six to eight health insurance companies are considering a merger in order increase chances of survival. LIDOVE NOVINY - Expenditure cuts in this year's state budget may be considerably higher than the 9.3 billion crowns predicted by the Ministry of Finance. One reason is that customs offices lost more than two billion crowns due to the bankruptcy of Kreditny Banka Plzen and this was not accounted for in the ministry's estimate. PRAVO - The sale of 500,000 hectares of state land is expected to begin next year and to last for 10 years. Currently parliament is working on a version of a law to control the sales, which should be passed by the end of this year. SLOVAKIA HOSPODARSKE NOVINY - Steel producer VSZ has discussed possible ways of cooperation with the Chinese firm Yunnan Tin Corporation and with Pohang Ironand Steel Co of South Korea. - The overall volume of loans from commercial banks increased by some 18.99 billion crowns, or six percent, in the first half of the year to total around 307.1 billion as of June 30. - Some 98 agricultural firms worth around 12.3 billion crowns, have so far been privatised in the second privatisation wave. The total number of agricultural companies slated for the second wave was 250, with property estimated to be worth some 66.5 billion crowns. - Revenues from the sale of water totalled 1.1 billion crowns in the first half of this year, some 4.2 percent less than in the same period last year. - The overall area sown with oil plants (rapeseed and sunflower) in Slovakia totals about 130,000 hectares. The country's consumption would require the area to increase at least to 160,000 hectares. PRACA - The paper quotes Russian oil sources as saying the manager-employee joint-stock company Slovintegra, which holds 39 percent in oil refiner Slovnaft, has already paid off the remaining 900 million crowns of the total sum of one billion, for the stake bought from the National Property Fund. SME - The paper writes VSZ now controls about 45 percent in Dopravna Banka. PRAVDA - Slovak opposition parties are preparing joint proposals for personnel reconstruction at the supervisory bodies controlling the Slovak Inteligence Service (SIS) and the National Property Fund (NPF) -- the state privatisation agency. LATVIA ALL NEWSPAPERS - Parliament ratified the treaty on the maritime border between Latvia and Estonia. - Parliament approved a declaration on the occcupation of Latvia, which calls on the international community to recognise the fact of Latvia's occupation by the Soviet Union in 1940. Ten deputies, representing the Socialist Party and the People's Harmony Party, voted against the bill. - Parliament approved a draft bill which will formally legalise abortions. The bill is strongly opposed by the Christian Democrat faction and the Catholic Church. DIENA - The Latvian Farmer's Union and the Union of Christian Democrats give partial support to the plan of Prime Minister Andris Shkele to abolish district governments. The two parties believe that the heads of the districts should be chosen by local residents. - After receiving an anonymous letter of threats to those investigating the activities of the OMON, a Moscow-backed paramilitary unit which fought against restoring Latvia's independence in 1990-1991, the interior ministry decided to start criminal proceedings. - The mayor of the city of Ventspils, Aivars Lembergs, who holds posts in several business companies, refuses to abide by the anti-corruption law, which says he should give them up. NEATKARIGA RITA AVIZE - 40 workers from the Riga mirror works went on strike to protest against delays in payment of salaries. BIZNESS & BALTIYA - Economy Minister Guntar Krasts met with officials from the Russian embassy in Latvia to discuss co-operation between the two countries. - President of the Latvian Gas company, Adrian Davis, said in an interview that the appointment of Piotr Rodionov to the post of energy minister in Russia will help the privatisation of Latvian Gas. DIENAS BIZNESS - Foreign companies will be offered up to 35 percent of shares from the Latvenergo new share issue. - The brewery Varpa starts producing Czech-brand Brauner beer. - The Bank of Latvia starts hard currency clearing. - Losses of the Latvian Shipping company reached $51.4 million. 2378 !GCAT !GPOL !GVOTE The general secretary of the national economy ministry, Miltiadis Papaioannou, submitted his resignation, the ministry said in a statement. Papaioannou will run for parliament as a candidate with the socialist PASOK party in the second district of Athens, it said. --Dimitris Kontogiannis, Athens Newsroom +301 3311812-4 2379 !GCAT !GPOL !GVOTE Former Greek conservative National Economy Minister Stefanos Manos will be the first to declare his candidacy for the presidency of the New Democracy party if it loses the elections, says today's daily Eleftherotypia. Manos will be a candidate because time is running out for him and because he thinks the ideology of "moderate conservatism" he espouses is the only alternative to the philosophy of "political correctness" championed by premier Costas Simitis, it says. Eleftherotypia cites well-informed sources in Manos' camp. --Dimitris Kontogiannis, Athens Newsroom +301 3311812-4 2380 !GCAT Leading stories in the Greek financial press: FINANCIAL KATHEMERINI -- New, favourable restructuring of debts by the National Bank of Greece. The writing-off of debts incurred by finacially troubled firms is probable -- Macroeconomic fundamentals will work to the socialists' advantage say the economics ministers IMERISIA -- Elections to attain EU convergence. The conservatives promise the abolition of objective tax criteria -- Conditions are ripe for a new interest rate cut KERDOS -- First skirmishes between the socialists and the conservatives over the economy -- The pre-election campaign started on TV. Shots aimed at the government's credibility EXPRESS -- The "battle" starts from the economy and the finance minister assures that the tax collection mechanisms will not slacken their efforts -- 33.5 billion drachmas will be given for improving health services in the Aegean -- OTE will decide about the digital switches procurement after the elections NAFTEMBORIKI -- Convergence with the European Union is the most important national reason for early elections -- Tax revenues were running at 30 percent in the first 20 days of August. Optimism about expenditures --Dimitris Kontogiannis, Athens Newsroom +301 3311812-4 2381 !GCAT Prepared for Reuters by The Broadcast Monitoring Company EVENING STANDARD 25 MILLION STG BILL FOR JAIL BLUNDER In an amazing Home Office blunder five thousand prisoners are to be set free at a cost of 25 million stg to the taxpayer. Multiple offenders are to be released after the government admitted it had miscalculated sentences with prisoners who were serving consecutive sentences being kept inside longer than necessary. ONE-2-ONE SEEKING ONE BILLION STG TO GROW The mobile phone company One-2-One jointly owned by Cable & Wireless and US West, is understood to be seeking to raise one billion stg from the debt and equity markets. The company wants fresh funds to finance its expansion in the highly competitive mobile phones market. DATE FOR LUCAS VARITY SHARES DEBUT Lucas, the components giant will today confirm that trading in the combined group LucasVarity, the combined group with Varity the US brakes and diesel engine manufacturer, will start on 6 September in London and New York. TELEWEST MOVES TO OFFER PHONES THROUGHOUT UK Britain's largest cable television company Telewest is to step up its drive into the telephony market by seeking a licence to offer its services nationally and internationally. Oftel is expected to approve the move. GENCOR TARGETS GFSA FOR 2.5 BILLION DEAL In a deal that could be worth 2.5bn, South African mining conglomerate Gencor is in discussions about acquiring Gold Fields of South Africa one of the last remnants of the Cons-Gold empire built by Cecil Rhodes. --For a full range of news monitoring services, phone BMC on -- BMC +44 71 377 1742 2382 !GCAT Prepared for Reuters by The Broadcast Monitoring Company -- BUNDESBANK CUTS REPO RATE TO 3 PER CENT The Bundesbank has announced a larger than had been expected cut in the country's securities repurchase (repo) rate. The move down to 3 per cent, aimed at boosting the German economy and taking pressure of the French franc, was justified primarily on the grounds of slower growth in the country's money supply figures. The cut was followed by a similar move by the Bank of France. The German decision had been expected, though the scale of the cut was greeted with some surprise. -- BASS SET FOR CARLSBERG-TETLEY DEAL Brewer Bass has announced that it is close to reaching an agreement that will see it pay 200 million stg for the stake in Carlsberg-Tetley owned by Allied Domecq ALL. D. Bass, however, is insisting on provisions that will allow it to withdraw should it transpire that the government calls for pubs in the group to be disposed of in return for agreement to the merger. Bass, the UK's largest brewer, is reported to have identified a number of synergies that can be capitalised upon between itself and Carlsberg-Tetley. -- BSKYB TO OFFER INTERNET ACCESS THROUGH TV SETS UK satellite broadcaster BSkyB is planning to offer as part of its planned digital TV services high-speed access to the Internet. The company revealed that the set-top boxes it will be using for receipt of digital signals will have the power of an average PC and will be equipped with a high-speed modem. It is hoped that this strategy will transform the TV set into one of the main routes through which people access electronic data. -- BET HELPS RENTOKIL ADVANCE 36 PER CENT The world's leading business services group, Rentokil, has announced an increase of 35.6 per cent in profits for the first half. The figure of 134.5 million stg was boosted by contributions from BET, which Rentokil acquired earlier in the year in a 2.1 billion stg deal. BET chairman Sir Clive Thompson noted that integration of the two companies is proceeding as planned and should result in annual cost savings of 20 million stg. -- TUBE DISPUTE SETTLED AS OTHER RAIL STRIKES BEGIN A last-minute deal with the RMT union means that a stoppage on London's underground railway system scheduled for Friday will not now go ahead. The agreement with the union will involve staff moving towards a 35-hour week in return for lower than the rate of inflation increases in pay for two years. A similar deal had already been accepted by the other main union involved, ASLEF. However, rail users in other parts of the country will still face disruption as catering staff and conductors on a number of regional railway companies strike. -- CBI FORECASTS NO INTEREST RATE RISE BEFORE ELECTION The latest report from the Confederation of British Industry on the prognosis for the British economy foresees no need for another rise in interest rates prior to the next general election. The employers federation notes that strong economic growth and low inflation can be expected, but that the Chancellor may have to exercise caution with regard to tax cuts in the next Budget. The forecast came as other figures indicated that companies have been reducing their inventory levels rather than meeting demand through increased production. -- GERMANY MAINTAINS DOUBTS OVER BSE IN LAMB The German government, in the wake of a warning delivered by a minister over doubts about the safety of British lamb, has been defending itself against accusations of whipping up hysteria. It has stressed that safety of such meat will remain an issue while uncertainty remains surrounding the possible transmission of BSE from cattle to sheep. The National Farmers' Union in Britain has expressed astonishment at the statement, describing it as unjustified. -- BRITISH GAS MAY RESIST COMPETITION MOVES British Gas has announced that there are certain aspects of planned reforms of competition for its infrastructure division, Transco, which it believes will actually hold back preparations for the advent of an opening of the domestic gas market in 1998. The company has, however, stated that it sees no problems with competition proposals for other areas of operation, including metering and gas storage. Executives from British Gas are still assessing details of the proposed price controls on Transco. -- SEVEN ON BAIL IN CABLE TV INQUIRY A number of people have been bailed after being arrested by the Serious Fraud Office as part of an investigation into possible fraud in construction contracts for the UK's cable industry. The seven arrested included two former employees of the country's largest cable company, Bell Cablemedia, as well as a number of building contractors. Bell Cablemedia is not itself under investigation, however. While the amount of money involved has not been revealed it has been noted that the SFO usually only deals with crimes involving in excess of one million sterling. -- MINIMUM WAGE SHOULD BE 'NO MORE THAN 3.50 STG' According to John Philpott of the Employment Institute the minimum wage proposed by the Labour party should not exceed three pounds fifty. In a report published by the Institute of Personnel and Development it is suggested that the wage for those aged less than 25 should be lower still. The report warns that certain industries that have traditionally made heavy use of low-wage staff will encounter difficulties in adjusting to the creation of a legally enforceable minimum wage. BMC +44-171-377-1742 2383 !GCAT Prepared for Reuters by The Broadcast Monitoring Company DAILY TELEGRAPH -- B.A.T SHARES PLUNGE ON US RULING B.A.T Industries BAT. L shares fell 24p to 422p yesterday on continued fears over the outlook for its US tobacco interests. Shares have fallen 78p since a Florida court awarded 480,000 stg in damages to a former smoker 10 days ago and wiped out 2.65 billion stg off the tobacco and insurance giant's market value. -- NATIONWIDE REFUSES TO HELP PERFORMANCE TABLE COMPILERS Soon to be Britain's biggest building society, the Nationwide, is refusing to help with a major insurance report. The report which ranks the performance of the 20 largest building societies and is produced by UBS, is due out in September. UBS sells the report mainly to bond investors but in the past it has been seen as a shopping list for acquisitive banks looking to buy societies perceived from the list to be good value. Nationwide is currently disputing the credibility of the report. -- RUSH BY FARMERS STIRS DAIRY CREST FLOTATION The flotation of Dairy Crest was given a fresh boost yesterday when the company disclosed that dairy farmers have opted for the maximum number of shares allocated to them. Nearly 88 percent of the eligible producers opted for shares rather than cash in the former Milk Marketing Board processing arm. Prospects for the company have been helped by a compromise on raw milk pricing reached two days ago between the Office of Fair Trading and Milk Marque. THE TIMES -- GERMAN RATE CUT STARTS A CHAIN REACTION Financial markets were yesterday surprised by the Bundesbank's aggressive cut in interest rates, a move widely interpreted as an attempt to keep single currency plans on track. Germany's central bank said that it was cutting its repo rate from 3.3 percent to 3 percent and its official discount and Lombard rates were held unchanged. The move was followed by the Bank of France cutting its key intervention rate from 3.55 percent to 3.35 percent. Rates were also cut by Belgium, the Netherlands and Austria. -- RENTOKIL RULES OUT ANY LARGE DISPOSALS OF BET BET. L Rentokil surprised the City yesterday by revealing that it was not planning to sell off major parts of BET, the rival business services group it bought earlier this year saying that any disposals would be a refining of the portfolio as distinct from any major sale. Rentokil, the pest control and personnel services company reported pre-tax profits up 35.6 percent to 134.5 million stg in the six months to June 30. -- NEWS INTERNATIONAL PLC PRETAX SHRINKS News International announced yesterday a 25 percent rise in operating profit to 153.1 million stg for the year to June 30, on sales up from 841.3 million to 1,007.1 million stg. Its pretax profit, however, fell to 415.9 million stg from 778.7 million. Executive chairman of News International, owner of The Times, said that the results had been achieved in an environment of fierce competition and rising raw material costs. THE GUARDIAN -- CBI PREDICTS FEWER TAX CUTS In a report released today, the Confederation of British Industry has reduced its forecast for tax cuts in the budget, as signs that rising consumer spending will offer a foundation for stronger growth next year. The CBI believe that the Chancellor, Kenneth Clarke, will give away only 2.0 billion stg in tax cuts and this will be more than matched by a 4.5 billion stg reduction in public spending. -- BASS SET TO CLINCH LONG-BREWING DEAL WITH ALLIED Bass and Allied Domecq last night put the finishing touches to a deal that will see Bass re-emerge as Britain's biggest brewer, after buying a half share in Carlsberg-Tetley from Allied. An announcement was expected today on the 205 million stg deal but sources said there had been so many postponements that negotiations could extend a little longer. -- GRID LINES UP SHAREHOLDERS AGAINST REGULATOR'S PLAN The dispute between the electricity industry regulator and the National Grid intensified yesterday as National Grid called on its million small shareholders to write to Professor Stephen Littlechild, the industry regulator, in protest at his plans to curb its profits. Trade unions are also drafting a joint letter to Professor Littlechild warning about the effect on Grid jobs of the proposed cut in revenues by 1.2 billion stg over a four year period. THE INDEPENDENT -- LABOUR ATTACKS UNITED SPENDING Labour yesterday staged a demonstration outside the London base of United Utilities, the company formed by the takeover of Norweb by North West Water NWW. L last year. The attack on the excesses of the privatised utilities was stepped up by Ian McCartney, the party's employment spokesman, who claimed the building at 43 Grosvenor Street, Mayfair, would cost 376,000 stg a year to rent, while only two or three rooms are being occupied. -- GEHE MAY MAKE NEW OFFER FOR LLOYDS CHEMISTS The German pharmaceutical giant Gehe, said yesterday it might make a renewed offer for Lloyds Chemist at the end of September. Chairman of Gehe's management board, Dieter Kaemmerer, said that the size of the bid would depend on cash raised from the disposal of several Lloyds warehouses. The office of Fair Trading and the Monopolies and Mergers commission made the sale of seven Lloyds warehouses a condition for Gehe to acquire the UK company. -- PRU SHARES UP ON RUMOURS OF M&G SELL-OFF Shares in Prudential rose sharply yesterday on expectations that it might abandon its planned 500 million stg float of reinsurance subsidiary Mercantile & General in favour of a trade sale. It was pointed out by analysts that a quick sell-off would allow the Prudential to concentrate on a sudden takeover bid for Woolwich Building Society. Buoyed by the market talk, the insurer's shares close up 17p at 442p. For a full range of news monitoring services, phone BMC +44-171-377-1742 2384 !GCAT !GCRIM Hundreds of British prisoners on Thursday looked forward to freedom earlier than expected after a blunder in calculating their sentences was uncovered. Prison sources estimated that between 400 and 500 prisoners would be freed and another 4,000-5,000 would have their release dates brought forward because of the mistake. The error, brought to light by a series of legal challenges by inmates, stemmed from the prison service's failure to take full account of time served on remand in the case of prisoners given consecutive sentences. The prison service confirmed that 33 prisoners were released on Wednesday from a jail in northern England and that the sentences of other inmates were being checked. "We're seeing hundreds of prisoners being released early, most of them convicted of many offences. They're turning up at probation offices, according to phone calls I've had today, completely unexpectedly," Harry Fletcher of the Probation Officers Association told ITN News. Those unfairly jailed could be entitled to sue the government for compensation. The bungling is a further blow for Home Secretary Michael Howard, Britain's interior minister, who has been embarrassed in the past year by a string of adverse court rulings and by break-outs from two top high-security prisons. 2385 !GCAT Following are some of the major events to have occurred on August 29 in history. 1475 - Truce of Picquigny signed, under which Edward IV of England agreed to withdraw his invading army from France in return for gold and a yearly pension. 1526 - In the Turkish-Hungarian War, Hungarians under King Lewis were defeated at the Battle of Mohacz. 1619 - Jean Baptiste Colbert, French government official, born. Finance minister to Louis XIV, he carried out programme of economic reconstruction which made France a dominant power. 1809 - U.S. physician, educator and author Oliver Wendell Holmes born. 1820 - Portuguese rebellion against the Regency began in Oporto, leading to a democratic constitution under King John VI. 1825 - Brazilian independence under Pedro I was recognised by Portugal. 1842 - The Treaty of Nanking was signed between the British and Chinese, ending the first Opium War. The treaty confirmed the ceding of Hong Kong island to Britain. 1871 - Albert Lebrun, 14th president of France 1932-40, born. The last president of the Third Republic, he was forced to surrender his powers in 1940 to Marshal Henri Petain. 1882 - English cricketers lost to Australia on English soil for the first time. A mock obituary in the Sporting Times declared the death of English cricket, saying its ashes would be taken to Australia. Since then matches between the two have been played for "the Ashes". 1885 - The first motorcycle was patented, built by Gottlied Daimler in Germany. 1915 - Swedish actress Ingrid Bergman born. 1916 - General Von Hindenburg became German Chief of Staff, controlling all German land forces during World War One. 1920 - Charley (Bird) Parker, U.S. jazz musician and composer, born. 1923 - Sir Richard Attenborough, British actor, producer and film director, born. 1938 - U.S. actor Elliot Gould born. 1939 - Sir Julius Chan, Papua New Guinea statesman and prime minister 1980-82, born. 1943 - Denmark abandoned its policy of co-existing with the occupying Germans and began an uprising. The entire remaining Danish fleet of about 30 warships and numerous submarines was scuttled. 1946 - Jean Baptiste Bagaza, president of the Republic of Burundi 1976-87, born. 1958 - Michael Jackson, U.S. pop singer, born. 1960 - Jordanian prime minister Hazza El-Majali and 10 others were assassinated in a bomb blast. 1965 - The U.S. Gemini V spacecraft, with astronauts Gordon Cooper and Charles Conrad on board, splashed down after an eight-day flight. 1966 - The Beatles played their last live concert at Candlestick Park, California. 1975 - Peruvian president Juan Velasco Alvarado was overthrown in a coup by Francisco Morales Bermudez. 1975 - Eamon de Valera, Irish statesman, died. He was three times prime minister and was president from 1959-1973. 1995 - Georgian leader Eduard Shevardnadze survived an assassination attempt when a car exploded near his motorcade. 2386 !GCAT !GENV U.S. marine biologists have trained a pair of sea lions to tag and photograph elusive whales as they cruise through the Pacific depths, New Scientist magazine reported on Thursday. James Harvey and Jennifer Hurley of the Moss Landing Marine Laboratories in California say their sea lions, natural companions of many species of whale, can go where no man or woman has ever gone before. "Any diver knows that when a whale gets going you can't keep up," Harvey told the magazine. "That is why we know only about five percent of what whales do." The sea lions -- 17-year-old Beaver and nine-year-old Sake -- have undergone six years of training for their mission. Beaver once worked for the U.S. Navy and Sake is an amusement park veteran. Harvey said they could accurately tag whales with a radio transmitter, and could also swim all the way around one of the giant mammals, filming it with a video camera. Their first assignment, later this year, will be documenting humpback whale migration off Monterey, California. The article did not spell out exactly how the sea lions manage to tag the whales but said in training they were taught to stick a radio transmitter on to a plastic model of a whale using suction cups. 2387 !C42 !CCAT !E41 !ECAT !GCAT !GJOB A strike on London's underground planned for Friday was called off at the last moment after an agreement between union and management late on Thursday, but strikes hit several train services in other parts of Britain. Seven regional services were facing disruption on Friday because of a strike by the Rail Maritime and Transport union over pay and conditions. Cross Country Trains, North London Railways, Northwest Regional Railways, Regional Railways North East, ScotRail, South Wales and West and Merseyrail, were all affected but most were running some services. The dispute is over productivity payments and refreshments for railway guards, caterers and conductors. South Wales and West Railways was the worst hit service, with most of its 500 trains cancelled. -- London Newsroom, +44 171 542 7950 2388 !GCAT !GPRO Rich, glamorous and single once more, Princess Diana finally emerges from her gilded royal cage on Wednesday to become the most eligible woman in the world. But that red-letter day, when her divorce from heir to the throne Prince Charles becomes final, casts Diana into a stormy sea with her only life-raft being her undisputed position as mother of a future British king. Denied her chance of becoming queen, having quit most of her charity posts and lost all the men she was ever close to, Diana's prospects look bleak despite the consolations of a 17 million pound ($26 million) divorce settlement. "She needs something new to fill her life with. The children are gone, that's it, boarding school, goodbye. She's got her charity work which makes her very busy, but she needs something else," said image consultant Mary Spillane. "She needs to develop an expertise in something that's real rather than being a Florence Nightingale figure and a clothes horse; that would fill this tremendous void that's within her," said Spillane in the book "Diana on the Edge". Diana, 35, may be rich but she is also lonely and freedom is likely to remain just a word for her. Like Jackie Kennedy Onassis, America's trend-setting First Lady widowed at the age of 34, Diana is destined to spend the rest of her life in the relentless media spotlight whether she likes it or not. "She will still be the top-selling royal until her son Prince William gets a girlfriend," said Judy Wade of "Hello" magazine. Friends say Diana would dearly like another child -- particularly a daughter -- and the astrologers she likes to consult say re-marriage is in her stars. But as the princess herself made clear in a dramatic television interview last November which sealed her fate as an ex-royal, there's no new Prince Charming on the horizon. "Any gentleman that's been past my door, we've instantly been put together by the media and all hell's broken lose. "You know, people think that at the end of the day, a man is the only answer. Actually a fulfilling job is better for me," she said. Since then however Diana has resigned from almost 100 charities, drawing back from her high-profile role among the sick and afflicted that earned her the nickname "Saint Di". She will retain her links with just six charities, including those connected with AIDS, cancer, leprosy and sick children. Thwarted by government and royal officialdom in her ambition to become a roving ambassador for Britain, she has nevertheless lined up charity work trips to Italy, the United States and Australia in the next three months. "She is determined to show them that she doesn't need them and that she will get some sort of ambassadorial role of her own making," said Wade. Much of her daily diary appears to be filled with shopping, workouts at an exclusive London gym -- where she met three of her recent admirers -- and visits to a bevy of counsellors, aromatherapists, osteopaths and specialists in colonic irrigation. Some commentators have voiced concern about the psychological state of the princess, whose own mother deserted her at the age of six and who has admitted throwing herself down the stairs. But the shy virgin who married Charles in 1981 and blossomed into a world superstar has always been one step ahead of the media. As a young bride, she applied herself with determination to master the art of public speaking and carved out a starring role for herself as the new kid on the block in the ancient British monarchy. She has already ditched her royal bodyguards, despite security objections, and last month fired her press spokeswoman making it clear there would be no immediate replacement. Some reports say she may go into a sort of voluntary exile -- possibly to New York where the press is kinder, the public still adoring and she has several close friends. Her formidable talent for public relations has ensured worldwide sympathy for her plight as a wronged wife, despite admitting that, like Charles, she enjoyed an illicit affair. Only last week she used her love-hate relationship with the press to win a court order against a troublesome paparazzo photographer and then turned the case into a headline-grabbing example of stalking. Diana has proved herself to be strong and single-minded -- a woman who in her own words "would not go quietly". "I don't feel sorry for myself in any way," she said in her revealing television interview last November. "I've got my work that I choose to do, and I've got my boys, and I've got lots of opportunities coming up in the next year." (1=.6460 Pound) 2389 !GCAT INDIGENOUS ELECTORAL CUTS "CALLOUS" SAYS OPPOSITION The Federal Opposition has described as callous, Government cuts to an Australian Electoral Commission programme to help indigenous people take part in the electoral process. The Coalition has cut the Aboriginal and Torres Strait Islander Electoral Information Service, worth two million dollars a year. Nineteen staff were employed to help indigenous Australians, particularly in remote areas, to understand their electoral rights and obligations. Labor Senator Bob Collins says closing the programme, which was initiated by the Fraser Government, is another example of the Coalition's callous disregard for reconciliation. Senator Collins says it turns the clock back two decades. - - - - COMMONWEALTH STAFF WITHDRAW FROM PUBLIC CONTACT Commonwealth public servants have voted to refuse to make contact with the public for two hours every Friday morning. Members of the Community and Public Sector Union approved the action today, as part of their campaign against spending cuts announced in the budget. Besides the restriction on public contact hours, union members have also voted to impose work bans. The union says 30 thousand jobs will be lost. - - - - NATIONAL CRIME AUTHORITY DEFENDED A member of the Joint Statutory Committee overseeing the National Crime Authority has defended the authority from attacks in the wake of the acquittal of businessman John Elliot yesterday. Federal Independent MP, Paul Filing, says there are problems with the N-C-A's operation, but he says it shouldn't be disbanded, as advocated by Victorian Premier, Jeff Kennett. Mr Elliot was acquitted of fraud charges brought by the N-C-A after a judge ruled the authority had acted illegally during its investigation. Federal Attorney-General Daryl Williams has ordered his department to review the NCA's role in the case. Mr Filing says the references given to the N-C-A by the committee of state and federal MPs which oversees it are in need of review. - - - - WINEMAKERS MISS OUT ON COMPENSATION Winemakers in the Hunter Valley, in New South Wales, are to miss out on a quarter of a million dollars in compensation promised by the Keating Government. Primary Industries Minister, John Anderson, has told the wineries that budget measures will be enough to replace the payments. Most wineries in the Hunter would have received six thousand dollars each this year as part of a three year deal with the ALP to compensate wineries which pay tax on promotional wines. - - - - CPSU MEMBERS RALLY AROUND AUSTRALIA Members of the public sector union have attended lunchtime rallies around the country today, protesting against public sector cuts. In some states, Community and Public Sector Union members attending rallies have voted not to return to work. In Victoria, about six hundred CPSU members have voted in favour of starting an industrial campaign against the cuts, beginning with a strike this afternoon. In Canberra, CPSU members have been told they need to embark on a long-haul industrial campaign to combat lob losses and outsourcing. The public servants have proposed lightning pickets at Parliament House, sit-ins and letter writing campaigns to stiffen-up the industrial response to the Federal Budget. - - - - RESORT GO-AHEAD "PAY BACK FOR GUNS", SAYS CONSERVATIONISTS Conservationists say the Federal Government's allowed the Port Hinchinbrook resort to go ahead to pay back rural North Queenslanders hit by tougher national gun laws. Queensland Conservation Council co-ordinator, Imogen Zethoven, says National Party Leader Tim Fischer indicated the resort would be allowed to go ahead at a time when he was under extreme pressure. Ms Zethoven says this means World Heritage values have been sacrificed to provide jobs for North Queesland. The council and the Wilderness Society have vowed to fight the decision. - - - - WILDERNESS SOCIETY TARGETS COMPANIES The Wilderness Society is welcoming the Prime Minister to Hobart by staging what it calls a theatrical "corporate orgy". The Society's members say the performance aims to protest against the Federal Government's involvement with multinational companies, Boral and North Limited. The Wilderness Society says the companies are involved in the destruction of Australia's forests, which the Federal Government is allowing to occur. John Howard is due in Hobart today as the guest of honour at a state Liberal Party dinner. - - - - ENDANGERED ANTELOPE BORN IN SOUTH AUSTRALIA Monarto Zoo in South Australia says it's achieved the births of two addax, an endangered species of antelope. A female calf was born three weeks ago and a second calf last night. Zoo director David Langdon says it's believed there are only about a thousand addax still surviving, most in captivity. - - - - WA SHIRE RECONSIDERS GROG LAWS Last Thursday's riot at the remote Kimberley town of Halls Creeks has prompted a review of alcohol related laws by the local Shire Council. Shire President, Josie Farrer, says options for tightening drinking regulations include closing liquor outlets on pay days, and having dry area restrictions similar to those in the Northern Territory. Ms Farrer says the Council agrees that alcohol ignites problems such as violence, and sees the only way of stopping it is by limiting the number of hours alcohol is available. Last week about 150 people went on an alcohol induced rampage through the town causing an estimated one million dollars damage. - - - - PETROL STATION OWNERS CRITICISE NEW PETROL PRICING CONTROLS The Competition and Consumer Commission's recommendation to remove petrol price controls is being criticised by service station operators. The Commission says with only four oil companies dominating the petrol industry, price controls are having a minimal effect. But the Motor Trades Association says some of the recommendations appear to entrench the oil companies' market power. It's called on the Government to issue a pricing guideline so wholesale pricing is more open and transparent. -- Reuters Sydney Newsroom 61-2 373-1800 2390 !GCAT !GENT **BIRTHDAYS** Australian classical pianist and composer ROY AGNEW was born in 1891. He wrote "The Breaking of the Drought". American dancer, actor, choreographer and director GENE KELLY was born in 1912. He starred in Hollywood musicals including "Singin' in the Rain" and "Invitation to Dance". He died earlier this year, aged 83. Australian artist DAVID BOYD was born in 1924. Australian golfer PETER THOMPSON was born in Melbourne in 1929. He won five British and three Australian Opens - the first Australian at the age of 18. He also won the New Zealand Open in 1950. American singer ANTHONY MICALE, who had the hit "(Just Like) Romeo And Juliet" in 1964 with 'The Reflections', was born in 1942. Australian actor GIL TUCKER was born in 1947. British drummer with 'The Who', KEITH MOON, was born in 1947. He died on the 7th of September, 1978. English playwright WILLY RUSSELL, who wrote "Educating Rita", was born in 1947. Australian pop singer and daytime soapie star RICK SPRINGFIELD (RICHARD SPRINGTHORPE) was born in 1949. He began playing guitar at the age of 14 and then recorded with the band 'Zoot' in the late 1960s. He went solo in 1971 and went to the United States where he scored a major role in the popular serial "General Hospital". Swimmer JUSTON LEMBERG was born in 1963. He set a new world record for the 400 metres freestyle at the 1984 Los Angeles Olympics. His time was three minutes 51.79 seconds. **EVENTS** 1680 : Captain BLOOD died. He was remembered for his attempt to steal the Crown Jewels from the Tower of London in May 1671. 1818 : The first steam ship service began on the Great Lakes in North America. 1902 : The American buffalo population was estimated at more than one thousand. Thirteen years earlier there were only 551 buffalo and it seemed the breed was heading for extinction. The Government said the Federal game laws of 1889 had had the desired effect. 1926 : The idol of millions, RUDOLPH VALENTINO, died. The 31-year-old screen actor died in the New York Polyclinic Hospital of peritonitis. "The great lover" was in New York to publicise his latest film "The Son of the Sheikh". Italian-born VALENTINO cultivated an image of himself as the epitome of virility. However the revelation that both his ex-wives were lesbians caused speculation about his own sexual orientation. News of his death reportedly provoked a rash of suicides. 1939 : British driver JOHN COBB reached 590 kilometres per hour at Bonneville Flats at Utah. 1939 : Germany and USSR signed a non-aggression pact. 1940 : German bombers began night raids on London. 1957 : Ansett Airways bought ANA for 3.3 million pounds to become TAA's chief rival. 1960 : American songwriter OSCAR HAMMERSTEIN died (born 12th July, 1895). He and RICHARD ROGERS formed one of the world's most successful musical writing teams. 1976 : Australia's Prime Minister MALCOLM FRASER was trapped for one hour in a basement office at Monash University by one thousand protesters. 1982 : Queensland unions declared a general strike in a "war" against the BJELKE-PETERSEN government. The State's first general strike in 70 years stopped trains, petrol deliveries, port operations and closed mines and factories. The dispute was over the push for the 38-hour week. 1985 : Bond Corp took over the Castlemaine Tooheys brewery. 1990 : The German states selected October 3rd 1990 as the date for unification. (Compiled from ABC ARCHIVES, ABC RADIO NATIONAL, "On This Day" published by REED INTERNATIONAL BOOKS LIMITED, "The Chronicle Of The 20th Century" published by PENGUIN BOOKS and "Rock And Pop (Day By Day)" published by BLANDFORD BOOKS) -- Reuters Sydney Newsroom 61-2 9373-1800 2391 !GCAT DEANE CALLS FOR RECONCILIATION The Governor-General has called on Australia's politicians to reaffirm their commitment to Aboriginal reconciliation. The call was made during a speech in Darwin to mark 30 years of Aboriginal struggle for land rights: Sir William Deane called on Commonwealth and State legislatures to pass formal resolutions expressing support for reconciliation with aborigines. - - - - HOWARD ATTACKS KELTY AND GEORGE Prime Minister John Howard has told a Liberal Party gathering in Canberra, that union leaders Jennie George and Bill Kelty could not wipe their hands of any responsibility for Monday's violent protest outside Parliament House. Nearly one-hundred Police officers and several protestors were injured, and some arrested, when demonstrators stormed the building, and wrecked the Parliamentary gift shop. ACTU Secretary Bill Kelty described the rally as the most successful union demonstration in Australian history, while President Jennie George dissociated the union movement from the violence. - - - - PUBLIC SERVANTS TO HOLD MEETINGS TODAY Commonwealth public servants will today hold meetings and rallies across the country in protest against job cuts which could reach as high as 30-thousand by the end of next year. The CPSU is focussing on a community awareness campaign, to try to soften the blow. The union's also concerned other aspects of the budget, such as contracting out job placement to the private sector, will disadvantage both the unemployed and taxpayers. The meetings and rallies, to be held in all capital cities and some regional centres, will decide on a future industrial strategy. - - - - BABY SNATCHED IN SYDNEY Police are investigating the abduction yesterday of a nine week old baby from Sydney's Westmead Hospital. The boy, from Coffs Harbour, was taken to hospital two weeks ago after developing a serious respiratory condition while on a family holiday in Sydney. At around five o'clock yesterday afternoon, an unknown woman described as being in her late twenties took the baby from a Westmead childrens ward. -- Reuters Sydney Newsroom 61-2 373-1800 2392 !E21 !E211 !ECAT !GCAT !GPOL By Russell Barton (ABC TV Political Editor) The word will fly for months, but in reality, the political battle over the budget was all over on Tuesday night. The Cabinet's decision to steal one of Labor's ideas which Paul Keating managed to block (the extra one percent Medicare levy for high income earners without private health insurance) and another move that should have been Labor's (the 15 percent surcharge on high income earners' superannuation contributions), decided the issue before Labor could fire a shot. In fact, it could be fairly said that this week has been one of Labor's worst for years, at least since the election aftermath, and a positive week of consolidation for the government. Labor's industrial wing took an enormous credibility hit from the two disgraceful riots in the parliamentary triangle in two days. All the pleas from Bill Kelty and Jennie George that they were not responsible nor aware of the revolting minority, although true, fell on deaf ears. Lack of proper planning and marshalling has left the Australian Council of Trade Unions and, to a lesser extent the Aboriginal and Torres Strait Islander Commission, with a lot of rebuilding to do before mainstream Australia will be prepared to listen to them again. BUT WAIT, IT GETS WORSE Inside parliament, there was an even worse development for Labor, the sudden resignation from the party of long-time Queensland senator Mal Colston. Initially, Labor members reacted predictably, slating Colston as a Labor "rat" and a "sook", accompanied by bitter recriminations from the lower orders against the leadership group who decided not to appease Colston's ambitions to be returned to the Senate deputy president's post. The rank and file also rankled over the leadership's failure to consult more widely about the looming disaster. Some shadow ministers are privately scathing about the decision. They said the party should have choked on its disgust and given Colston what he wanted; that the costs were much greater than hurt pride. But they called his bluff and he dealt the party his most damaging hand. By yesterday, the leadership had ordered the curtain to be drawn on the affair and that the insults cease. STUFFING KNOCKED OUT OF LABOR But the uncertainty created by the Colston bombshell has knocked all the remaining stuffing out of Labor; as a consequence, its attack on the budget has hardly dented the government and that's quite a failure given the amount of cuts delivered by this budget. Now comes the wait to see just where Colston's vote will fall on the key bills. Labor senators insist that he'll vote against the Workplace Relations Bill, or at least for major surgery on its provisions. But his vote on that now seems irrelevent with the Australian Democrats declaring they'll vote for the bill with some amendments which look set to win agreement from the government. So it's the Telstra bill which now looms even larger. Colston's move has had a dramatic effect on the Senate's numbers and the tactics which each side will now employ. Having lost one of its numbers, Labor's combination with the Democrats and the Greens musters 37, equal with the coalition government. The two independents, Colston and Tasmania's Brian Harradine, therefore have enormous leverage -- just one of them can tilt the numbers the government's way. That means the Labor/Democrats/Greens team can no longer block legislation even if Colston is absent -- an an independent, he'll no longer be given a "pair". INDEPENDENTS WILL VOTE IN TANDEM But it's increasingly evident that the two independents will quite often vote in tandem. Brian Harradine revealed this week that Colston had consulted him about his plans five weeks ago. Harradine was the first to inform Labor leader Kim Beazley of the trouble in his Senate camp. Since then, Harradine and Colston have been bosom buddies. Harradine, like Colston, is old right-wing Labor. In the 1960s he was secretary of the Tasmanian Trades and Labor Council and on the ACTU executive, before he "ratted", to use the party's parlance. As such, his vote in the Senate is not easy to predict. But the government shouldn't be counting either man's vote for the Telstra privatisation just yet. Consider Harradine's remarks on radio this week: "I've always opposed the sale of public monopolies to private enterprise. "The question is whether Telstra now or after the 1997 environment is in the market as such, in other words if it's got such a stranglehold it's still a monopoly." This was vintage Harradine. He's been in this sort of pivotal position in the Senate before and he knows just how to milk it -- give nothing away until it's time to cast your vote. In the meantime, he'll continue to give each side some encouragement without tying himself down. Under his tutelage, expect Colston to do the same. So far, Colston's said only that he appreciates the government has a mandate on some issues. But equally, he'll judge each issue against what he believes are the interests of his Queensland constituents. -- Reuters Canberra Bureau 61-6 273-2730 2393 !E12 !E21 !E211 !ECAT !GCAT !GPOL Australian Prime Minister John Howard said the possibility of lower interest rates was being jeopardised by Parliament's upper house where opposition parties planned to scrutinise the 1996/97 budget. "Every time the Senate hacks away at the budget, they hack away at the lower interest rate environment," Howard told reporters on Thursday night after attending a Liberal Party function. Senior ministers have repeatedly warned since the fiscally-tight budget was handed down on Tuesday night that the chance of lower official rates could be hampered in the Senate. The budget contained sharp spending cuts in areas such as the labour market to reduce the deficit to about A$5.6 billion. The conservative government's plan for reform of the industrial relations environment and to partially sell Telstra has also been opposed by parties in the Senate such as the Greens and Australian Democrats as well as the official opposition, the Labor Party. Official cash rates were last cut on July 31 to 7.0 percent. -- Sydney Newsroom 61-2 373-1800 2394 !GCAT !GPOL The Alliance Party, for months in the political doldrums, has picked up in a National Business Review opinion poll published on Friday. NBR said the increased support came on the back of the Alliance's opposition to the government's sale of Forestry Corp of New Zealand. The Alliance's share of the party vote jumped four points to 16 percent in the latest NBR-Consultus poll, while each of the other three main parties lost support. The ruling National party led with 34 percent (down three points) -- which the NBR said was its lowest share of the party vote since late May 1994. National was followed by New Zealand First, down two points to 21 percent, and Labour, down one point to 20 percent. Among the minor parties, ACT New Zealand had its best performance, capturing 3.4 percent of the party vote, just behind the Christian Coalition on 3.6 percent. Parties which do not win one of the 65 constituency seats need to register five percent party support to qualify for seats in parliament. The government on Tuesday announced the sale of Forestry Corp to a consortium led by Fletcher Challenge, for NZ$2.026 billion (US$1.38 billion). The sale stirred heated opposition, with a TVNZ poll showing more than 60 percent of New Zealanders opposed the privatisation of Forestry Corp, which controls 188,000 hectares of prime pine and fir forest in the central North Island. Both the left-wing Alliance Party and the economic nationalist New Zealand First said they would return the consortium's cheque and repurchase the forest if they became the government after the general election on October 12. --Wellington Newsroom (64 4) 4734746 2395 !C12 !CCAT !GCAT !GCRIM Timber producer Auspine Ltd said it would defend Supreme court proceedings brought against it by IOOF Australia Trustees Ltd. Auspine said the proceedings made allegations concerning the operation and management of plantations and the sale of timber from plantations subject to covenants issued by Auspine and related entities. The amount claimed by IOOF was not specified as yet, the company said. Auspine shares were suspended pending an announcement prior to the commencement of trading on Friday. Its previous close on Thursday was A$3.31, up one cent. -- Sydney newsroom 61-2 9373 1800 2396 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The wage deal struck between Qantas Airways Ltd and the Transport Workers Union (TWU), under which TWU workers receive an eight percent pay rise over two years, was seen as positive for Qantas by aviation analysts. "I think (analysts) would have had increases in their (cost) numbers and the four per cent per year for two years, I would have thought, is a reasonable outcome," one Melbourne-based aviation analyst said. "I think if they can some more flexibility, then they can really get grab some efficiencies." A Sydney analyst agreed the outcome was positive. "It's very, very good," he said. Initially, unions had sought a 10 percent increase in each of the next two years. Qantas said on Friday it was hopeful of reaching wage deals soon with other unions representing over 13,000 workers after striking an agreement with the TWU. The airline's chairman, Gary Pemberton, said on Thursday the airline's planned A$330 million cost cuts for the 1996/97 were independent of the current wage negotiations. Qantas, 25 percent owned by British Airways Plc, issued a cautious outlook for the year to June 30, 1997 on Thursday, despite a 37 percent rise in net profit to A$246 million for the year to June 30, 1996. Qantas shares closed six cents lower at A$2.08. -- Sydney Newsroom 61-2 373-1800 2397 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Qantas Airways Ltd said it was hopeful of reaching wage deals soon with other unions after striking an agreement for en eight percent pay rise over two years with the Transport Workers Union (TWU) earlier on Friday. "We are optismistic that we will be able to get an agreement with the other unions in the near future," said Ian Oldmeadow group executive manager operations. Oldmeadow said the airline was in talks with Australian Services Union (ASU), Flight Attendants Association of Australia (FAAA), Licence Aircraft Engineers Association and four unions representing metal workers. Oldmeadow said all the unions, including the TWU, represent about 20,000 of the airline's staff. He said the current union talks would be for a similar wage deal struck with the TWU. "What we have said that that amount is available subject to us reaching changes in the workplace and we are close to an agreement with a number of those unions on a number of those changes," Oldmeadow said. He said workplace changes include part-time employment, flexibility in the workplace and hours worked. Qantas would meet next Thursday with the Australian Council of Trade Union (ACTU) to give a progress report to the union-body, he added. Oldmeadow said there was no productivity bargaining with any of the unions. Qantas, 25 percent owned by British Airways Plc, issued a cautious outlook for the year to June 30, 1997 on Thursday, despite a 37 percent rise in net profit to A$246 million for the year to June 30, 1996. Qantas shares closed six cents lower at A$2.08. -- Sydney newsroom 61-2 9373-1800 2398 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The union negotiating for the largest group of workers at Qantas Airways Ltd said on Friday it had yet to reach a wages deal with the airline. "We'll be having further discussions next week," Flight Attendants Association of Australia (FAAA) Federal Secretary Lance Webb told Reuters. "The company still haven't put a definition of what it is they're asking from flight attendants in terms of productivity offsets in return for eight percent," Webb said. Earlier the Transport Workers Union, which has 5,500 Qantas workers, said it had agreed to an eight percent pay rise over two years with productivity offsets. The FAAA covers over 6,000 Qantas workers. Webb said only the FAAA and the licenced aircraft engineers had yet to reach a deal with Qantas. Webb said his union could reach a deal with Qantas next week if the company would seriously propose what productivity offsets it wanted and if their was goodwill on both sides. Qantas' shares closed six cents lower at A$2.08. -- Sydney Newsroom 61-2 9373-1800 2399 !C13 !C24 !CCAT !GCAT !GENV Australian Transport Minister John Sharp said a substantial reduction in aircraft noise for those to the north of Sydney airport could be delivered if the recommendations of a new report were introduced. "The report...proves that it is both safe and feasible for aircraft to take off to the north on the new third new runway at Sydney's Mascot airport," Sharp told reporters on Friday. The report, commissioned in May, showed that it was possible for aircraft to take off to the north on the third runway and then turn right and follow existing flight paths out to sea, he said. "What it also proves is that if this plan is implemented, then people living to the north of the airport...will experience a dramatic reduction in the aircraft noise," Sharp said. However, this would be at the expense of people to the airport's east, although Sharp said "the total number falling within a noise-affected and would actually be less than when the east-west runway was regularly used in the early 1990s." Sharp said it would take four weeks to implement the recommendaions once the government was in a position to make a decision, which would depend on advice they would receive over the next few weeks, including on environmental considerations. "If we can get that advice fairly quickly, then it's quite possible that this could be implemented in the next couple of months," Sharp said. The Liberal National government reopened the east-west runway soon after gaining power at the March elections, lifting the previous government's policy of only using the runway when crosswind prevented use of the two north-south runways. The former government said the use of parallel runways was safer, but its successor said the limit was political and removed it with the aim of sharing noise among nearby residents. Sharp said the east-west runway accounted for about 17 percent of all movements, slightly above the 15 percent target the government set. -- Canberra Bureau 61-6 273 2730 2400 !GCAT !GDEF !GDIP Australia, disappointed at the failure of talks to forge a nuclear test ban treaty, said on Friday it would push for world-wide agreement on a test ban through the United Nations General Assembly. Foreign Minister Alexander Downer said Canberra would sponsor a resolution seeking action from the United Nations after the Conference on Disarmament failed in Geneva to agree on a treaty text in the face of opposition from India. "With the support and cooperation of other Comprehensive Nuclear Test Ban Treaty (CTBT) supporters, we will work to achieve the treaty's endorsement during the current session of the UN General Assembly and its opening for signature at the earliest possible date," Downer said in a statement. Downer was visiting China on Friday, but his statement was issued in Canberra. Government officials here said Australia would now lead the push to win agreement for the treaty and would seek co-sponsors for the UN move. "We are leading the charge," one official told Reuters. The officials said Australia might seek to isolate New Delhi as there was little likelihood that India, one of three nuclear "threshhold" states, could be convinced to reverse its stand. Downer said Australia was deeply disappointed at the 61-nation Conference on Disarmament's failure on Thursday to forge agreement on the treaty, which would have banned all nuclear explosions used to test and refine nuclear weapons. The treaty was blocked by India, which opposed the pact because it did not contain a clause committing the five declared nuclear powers to a timetable for nuclear disarmament. "Australia and other supporters of the CTBT have come to the conclusion that failure to close on this treaty now would mean the loss of a CTBT for the foreseeable future," Downer said. "I am convinced that this would represent a very serious setback for global efforts to advance nuclear disarmament and non-proliferation objectives," he said. Australia, a middle-ranking, non-nuclear power, has sought to play a leading role in the campaign to end nuclear testing and rid the world of nuclear weapons. Canberra will present a report to the UN General Assembly in September outlining a blueprint for nuclear disarmament. The report was drafted by a commission of international experts, including former French prime minister Michel Rocard and former U.S. defence secretary Robert McNamara. Australian ambassador for disarmament Richard Starr told Reuters in Geneva that Canberra still believed the treaty could be salvaged after nearly three years of negotiation and "decades of expectations." "There is a clear need for friends of the CTBT to consider action so that the whole international community will be able to consider, endorse and sign this valuable treaty," Starr said. "We would not want to see a treaty text die in a pigeon hole in Geneva," he said. Diplomats in Geneva said earlier this week that the five declared nuclear powers -- Britain, China, France, Russia and the United States -- considered Australia best placed to present the draft treaty to the U.N. General Assembly in the form of a resolution calling for a swift signing ceremony. The five have made clear they did not want the pact reopened for negotiation or fresh amendments in New York. 2401 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Australian transport workers and Qantas Airways Ltd have struck a deal for an eight percent wage rise, the Transport Workers Union (TWU) said on Friday. "The TWU and Qantas have reached an in principle deal for a wage increase of eight percent over the next two years for the TWU's 5,500 members at Qantas," union federal secretary John Allan said in a statement. "The TWU's delegates have endorsed the in principle deal which, if accepted by the rank and file, will ensure that these members are paid a fair wage through to mid-1998," Allan said. The union had sought a 10 percent wage increase over each of the next two years. Qantas had offered a total eight percent wage increase over two years in return for productivity offsets. "Despite earlier demands by Qantas which were unreasonable, we now believe that the modified trade-offs mean the agreement with Qantas is fair," Allan said. The carrier and the union also agreed to review the classification structure in the labour agreement, or award, Allan said. "An important consideration in this deal is that it will ensure Qantas' ongoing competitiveness and long term jobs for our members," he said. Neither Allan nor a union spokesman could be immediately contacted to say when union members would consider the deal, or give further details. There are no details on Qantas' negotiations with other unions covering its workforce. "There are now a few unresolved matters which are being dealt with at an Australian Council of Trade Unions level, namely the development of a protocol for outsourcing, a company position on redundancy, and the employee share option," Allan said. "I plan to call upon the ACTU to finalise these matters with Qantas as a matter of urgency." Qantas, 25 percent owned by British Airways Plc, issued a cautious outlook for the year to June 30, 1997, despite a 37 percent rise in net profit to A$246 million for the year to June 30, 1996. -- Canberra bureau 61-6 273-2730 2402 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Over 2,000 striking workers voted on Friday to return to work on Monday at Toyota Australia's Melbourne assembly line, ending a two-week stoppage. 2403 !E11 !E13 !E131 !E21 !E211 !ECAT !GCAT !GPOL Australian Prime Minister John Howard said on Friday that the main thrust of the 1996/97 budget handed down on Tuesday was to achieve a faster rate of economic growth without threatening higher inflation. "We must over time learn how to produce a faster rate of growth without increasing pressures on prices or the current account deficit," Howard told a Liberal Party function in Sydney. Howard said the Australian economy was experiencing low inflation and falling interest rates. "We have an economy which has low inflation and falling interest rates," he said. The government has repeatedly said it would like another cut in interest rates but this could only be achieved if the budget was passed by the upper house, which is controlled by the opposition Labor Party and minority parties. He said he welcomed recent conciliatory comments by the Australian Democrats about the benchmark industrial relations bill currently before the Senate and was hopeful it would be passed. The industrial relations bill, while not part of the budget legislation, is a key part of the government's economic strategy which is designed to reduce small business costs. The Labor Party has said it would oppose the bill, along with the Greens. The budget papers forecast economic growth of 3.5 percent this fiscal year compared with 4.1 percent in 1995/96. Underlying inflation was set to ease to 2.75 percent from 3.2 percent last year, according to the documents. -- Sydney Newsroom 61-2 9373-1800 2404 !E21 !E211 !ECAT !GCAT !GPOL Australian Treasurer Peter Costello said on Friday he would consider later what to do about plans to implement further budget savings. Asked whether it was still his intention, as stated before Tuesday's budget, to implement A$8 billion in cuts, Costello said: "I put down A$7.2 billion. It's a two year programme, I'm asking (for) the right of the elected government to implement that programme in the parliament and what we do after that, we'll have a look." Costello on Tuesday released the new conservative government's budget for the year to June 30, 1997, halving the underlying deficit to A$5.6 billion from A$10.3 billion in 1995/96. The underlying measure excludes asset sales and state government debt repayments. Costello's budget implemented cuts in annual spending that will grow to A$7.2 billion annually over two years. But the budget is subject to approval by parliament's upper house, the Senate, where the government does not have a majority and needs the support of at least two non-government senators in the 76-seat chamber. The Labor opposition and minor parties have expressed concern about some parts of the budget and warned they would block various measures, including increased charges on university students. -- Canberra bureau 61-6 273-2730 2405 !C12 !C18 !C181 !C41 !CCAT !GCAT !GCRIM The former chairman of retailer Coles Myer Ltd, Solomon Lew, defended on Friday his part in a A$12 million settlement in relation to the controversial 1990 Yannon transaction, and said he was not a seller of Coles shares. Instead, he said, he would increase his shareholding "at the appropriate time". 2406 !GCAT !GCRIM Retailer Coles Myer Ltd said on Friday it had concluded a mediation in relation to the 1990 Yannon transaction following talks between the parties resulting in Coles receiving A$12 million from various parties. 2407 !C21 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Shell Australia Ltd hopes to bring its 115,000 barrels per day (bpd) refinery near Melbourne back to normal production within several days, a Shell source said on Friday after a 10-day strike ended. The source told Reuters he could not give a firm schedule for the refinery's return to full output, but said it should take several days. "The refinery will be progressively starting up during the weekend. Maybe they (refinery management) will go through the weekend before they are up and running, but basically they will be starting up progressively as things proceed," he said. The strike by the refinery's 240 or so operators ended on Thursday afternoon, when Shell and the Australian Workers' Union reached a compromise on their bitter dispute over changes to work practices. The operators voted to return to work from 7 p.m. (0900 GMT) on Friday. The refinery has been operating at around one-third output since late last week with non-union labour. The operators had shut down the plant before walking off the job on August 13. One of the two product ships which had been sitting off the Geelong refinery during the strike, waiting to be loaded, had been "redeployed" without lifting, the source said. He declined to give details. Asked if the company had been forced to declare force majeure on any shipments, he declined to comment. The redeployed ship was under a charter arrangement and was to have delivered a cargo of fuel oil and jet oil to Papua New Guinea. Another product ship would be loaded soon and two tankers carrying a total of 500,000 barrels of Far East crude were also waiting off the refinery, waiting to discharge. Throughout the strike, Shell agreed to take as much crude oil as possible from its main supplier, a joint venture between Exxon Corp subsidiary Esso Australia Ltd and The Broken Hill Proprietary Co Ltd. Gippsland crude producer Esso-BHP normally accounts for up to 60 percent of the refinery's crude. -- Melbourne bureau 613-9286-1421 2408 !GCAT -- HONG KONG STANDARD - China cut interest rates by an average 1.2 percentage points on lending and 1.5 percentage points on savings. It was the second reduction in less than four months. -- MING PAO DAILY NEWS - Hong Kong tycoon Li Ka-shing predicted Hong Kong's property market would pick up towards the end of the year, becoming prosperous in 1997. -- HONG KONG ECONOMIC JOURNAL - The decision by China's central bank, the People's Bank of China, to cut interest rates had boosted Hong Kong H shares to the highest point in the past 12 weeks. -- SOUTH CHINA MORNING POST - A breakthrough had been announced in the textile dispute between Hong Kong and the United States, which had threatened billions of dollars in exports. U.S. officials would be permitted to visit factories to check allegations that falsely labelled goods were evading quota restrictions. -- Cheung Kong (Holdings) and Hutchison Whampoa turned in stong interim results thanks to an improved property market and the sale of interests in British telecommunications unit Orange. -- HONG KONG ECONOMIC TIMES - Shanghai Petrochemical Co took advantage of China's interest rates cut to sell 500 million shares at HK$2.07 each. Peregrine Derivatives acted as the distributor. -- MING PAO DAILY NEWS - Air tickets to Hong Kong from Vancouver, Sydney and London at the end of June next year were almost fully booked. Many people planned to visit Hong Kong to witness its return to Chinese sovereignty. The Hong Kong Tourist Association said the territory was expected to receive tens of thousands of visitors during the handover. -- TA KUNG PAO - The State Council's Taiwan Affairs Office urged Taiwan to co-operate in starting direct links with China as soon as possible in order to accelerate economic prosperity on both sides of the Taiwan Strait. -- The living standards of Chinese intellectuals had been upgraded to reflect their level of education, ending the days when the income of rocket scientists was less than that of street hawkers. -- Hong Kong newsroom (852) 2843 6441 2409 !GCAT !GHEA A 59-year-old woman died of food poisoning on Friday in western Japan's Nara prefecture, casting a cloud over the country's plans to declare that the threat from a mysterious killer germ was receding. The woman, a housewife from Yamatotakada city who had been hospitalised since last month, was the 11th person to die from the O-157 colon bacillus. "We feel very sorry that things turned out so very unfortunate. We did not expect such a rapid change because her condition seemed stable," Tomofumi Morita, head of the prefecture's health bureau, told a news conference on Friday. The woman was admitted to the hospital in July after being diagnosed with haemolytic uremic syndrome (HUS), complications associated to infections with the O-157 bacteria. She suddenly lapsed into critical condition on Wednesday, following heavy bleeding and breathing difficulties, a spokesman for Nara city told Reuters. The O-157 colon bacillus has been found responsible for a widespread food poisoning epidemic that has also made more than 9,500 people ill this year. The city of Sakai, near Osaka in western Japan, has been hit hardest by the food poisoning epidemic, with nearly 6,500, mostly school children, affected by the disease. Health authorities believe school lunches are the source of the food poisoning which hit Sakai. But researchers have been unable to locate the exact source of the infection. The outbreak has prompted authorities to tighten sanitary standards at slaughterhouses and meatpacking plants and sparked calls for an overhaul of the nation's school lunch programme. News of the woman's death came as Japanese media reported that health officials were preparing to declare next month that the worst of the epidemic was over as the number of new infections had decreased. "There are no new cases of infection and I hope we can make public a bright outlook," Health Minister Naoto Kan said on Thursday while visiting the Osaka prefectural government. The Education Ministry has started preparations to resume school lunches and encouraged schools to admit children who carry the bacteria but have not developed any symptoms. But Sakai city officials remain unconvinced about the government's outlook, fearing a further spread of the disease through secondary infections by carriers of the germ. "There are still threats of secondary infections and the city of Sakai may not be able to do as the Education Ministry requests," Takeshi Miyazaki, head of Sakai city's education board said on Tuesday. The Health Ministry said on Thursday that 9,509 people had fallen ill from the O-157 bacteria in Japan, of which 307 were still hospitalised. 2410 !GCAT Newspaper headlines CHINA TIMES - Taiwan pilots tested Sukhoi Su-27 fighters in Ukraine. Communist China's central bank sharply cut interest rates from today (August 23). UNITED DAILY NEWS - Vice President Lien Chan says Ukraine leaders praise Taiwan's process of democratisation. Second Lafayette-class frigate ordered from France expected to arrive in Taiwan next month. COMMERCIAL TIMES - Taiwan cabinet plans measures in bid to bring down rising unemployment rate, including curbing import of foreign labour. Communist China to introduce new policies on direct commerce across Taiwan strait. ECONOMIC DAILY NEWS - Southwestern county of Yulin wants its Mailiao harbour to be designated port for direct shipping links with mainland China. Vice President Lien Chan says communist China's rules governing direct shipping links contain good intention. -- Taipei Newsroom (2-5080815) 2411 !GCAT Following is a summary of major Indonesian political and business stories in leading newspapers, prepared by Reuters in Jakarta. Reuters has not checked the stories and does not guarantee their accuracy. Telephone: (6221) 384-6364. Fax: (6221) 344-8404. - - - - KOMPAS Indonesia's President Suharto said East Timorese were free to sue Portugal, East Timor's former colonial ruler, in the International Court of Justice for cruelty during its colonisation of the territory. - - - - JAKARTA POST The Central Jakarta district court urged Megawati Sukarnoputri, the ousted leader of the Indonesian Democratic Party (PDI), to reach an out-of-court settlement with her opponents. Megawati is suing the government and the military for backing a rebel congress in June which deposed her. The central bank, Bank Indonesia, has reportedly suffered, for the first time in history, 2.0 billion rupiah ($851,063) in losses from fake transactions believed to have been committed by the bank's employees. - - - - REPUBLIKA A police captain will stand trial for alleged negligence which led to the escape of an actress, Zarima, accused of possessing nearly 30,000 Ecstasy pills. - - - - MERDEKA One kidnapper was killed during a clash with Indonesian soldiers who tried to free 12 forestry workers in remote Irian Jaya province who were kidnapped last Wednesday. 2412 !GCAT DAY'S TOP STORIES - Transport operators have shelved indefinitely their plan to ask for an increase in bus and jeepney fares as the latest four-centavo per litre increase in diesel prices is minimal and has no significant impact on their operations. (MANILA BULLETIN) - The Commission on Elections has approved the appointment of 15 security personnel for Moro National Liberation Front (MNLF) chairman Nur Misuari during his campaign for elections to the governors post in the Autonomous Region in Muslim Mindanao. (MANILA BULLETIN) - The militant Abu Sayyaf group plans to derail the peace talks between the MNLF and the government by assassinating top critics of the peace deal and blaming it on the MNLF, a security team at Malacanang palace said. (TODAY) - Trouble is again brewing in the strife-ridden Laban ng Demokratikong Pilipino as the party leadership threatened to discipline congressmen who refused to break away from the rainbow coalition. The Laban used to be part of a coaltion with the Ramos government. (TODAY) ++++ BUSINESS - The Supreme Court has issued a temporary restraining order preventing Philippine Commercial International Bank (PCI Bank) from holding its annual stockholders meeting on Friday. (TODAY) - Tobacco and beer magnate Lucio Tan has accumulated 20 million shares of the Lopez-controlled ABS CBN Corp, enough to land him in the 11-member board of directors of the country's largest broadcasting network. (THE MANILA TIMES) - Manila newsroom (632) 841 8934 2413 !GCAT !GVIO Students at South Korea's Yonsei University threw more than just ordinary rocks at riot police -- some were samples that the geology department had taken 30 years to collect, newspapers reported on Friday. Geology prefessors were quoted as saying that their collection of 10,000 rocks, gathered from across the nation and abroad, were irreplaceable. "These are not like missing window panes or broken desks. They are lost forever," said one professor. The students staged a violent nine-day demonstration at the university to demand unification with North Korea. Police ended the protest on Tuesday after storming the campus. 2414 !GCAT !GPOL !GVOTE Japan's political parties are revving up their electoral machines for polls expected later this year, but a growing number of legislators want to scrap their parties for new vehicles to get them through the race. Foremost among the tyre kickers is Yukio Hatoyama, 49-year-old grandson of a 1950s prime minister and an official of Sakigake, the junior member in a three-party coalition with the Liberal Democratic Party (LDP) and the Social Democratic Party (SDP). Hatoyama, who boasts an engineering doctorate from Stanford University in California, will need all the design skills he can muster to forge a party from the idealistic reformers of Sakigake and the ideologically fatigued SDP, pundits say. The latest round of manoeuvring -- which intensified this week -- involves some of the very same legislators whose 1993 defections from the LDP ended four decades of unbroken rule by that party and put a reformist coalition in power. The mavericks' goal in 1993 was reform to undo the side effects of one party-rule -- political corruption, bureaucrats' dominance of policy-making and an absence of policy debate -- projects that still await completion, analysts say. The aim this time around, ironically, is for the small parties to survive one of the only major reforms the previous coalition made stick -- a radical overhaul of the electoral system under which they must face voters before next July. In 1994, then-prime minister Morihiro Hosokawa's coalition government introduced an electoral system in which 300 legislators are elected in first-past-the post, single-seat districts and 200 others by proportional representation. The new system replaced one in which 129 districts sent between two and six legislators to parliament. The multi-seat districts, in which a legislator could win a seat by finishing in fifth place with about 10,000 votes from a narrow interest group, were thought to foster pork barrel politics and corruption. The old system, however, was friendly to smaller parties, which lack the personnel and resources to win one-on-one contests against the well-oiled and deeply entrenched LDP and Shinshinto, the main opposition party. The parties expected to face the toughest battle in the next electoral contest are Sakigake and the SDP. Sakigake, with only 23 seats in parliament, is too tiny to take on the big parties, while the larger SDP suffers an identity crisis after dropping its traditional leftist defence and foreign policies without coming up with new ones. Policy issues have taken a back seat to public disputes over personnel and timing questions in Hatoyama's group, prompting scepticism about whether it can recapture the reform spirit of 1993 that the LDP's re-emergence has all but stymied. "It was only three years ago, but it's almost like 30 years ago," said policy analyst Kenichi Ohmae. "I think it (a chance for reform) will come back again, but the biorhythm today is very low. You have to wait for the next wave." Hashimoto must call polls by mid-1997, and has repeatedly said he would not consider calling an early general election. But many analysts and politicians believe he may dissolve parliament soon after it reconvenes in early October. No date has been set for the opening of parliament. 2415 !GCAT !GCRIM !GDIP !GPOL Police said on Friday they had arrested 51 Chinese found hiding in saunas for illegally entering Japan. Fukuoka prefectural police in southern Japan raided four saunas after receiving calls that there were suspicious foreigners there. The 51 Chinese, all males aged between 16 and 51, were arrested for not carrying passports. They are believed to have reached Japan by boat. "We still don't know if the four different groups all came on the same boat. We're still in the process of investigating the details," a spokesman for Fukuoka police told Reuters. Some of the men told police they arrived in Japan on Thursday night from Fujian Province in southern China as a group and were taken by bus to the saunas, Kyodo news agency reported. A Japanese man staying with the Chinese at one of the saunas was also arrested for allegedly helping the Chinese enter the country. Separately, coast guards in Nagasaki Prefecture near Fukuoka seized 14 Vietnamese, including a four-year-old boy, aboard a small wooden boat in waters off the prefecture on suspicion of attempting to illegally enter Japan. None of the Vietnamese carried passports, and the boy was handed over to immigration authorities, a spokesman for the Nagasaki Maritime Safety Agency said. The 13 other Vietnamese, of whom 10 were men, were aged between 18 and 35. 2416 !GCAT !GDEF China must crack down on corruption among military recruiters to boost the quality and political reliability of new soldiers for its three-million strong armed forces, the Liberation Army Daily said on Friday. Problems in the drafting process had great influence on the standard of young recruits, and investigators should balk at neither rank nor reputation in tracking down offenders, it quoted Chief of the General Staff Fu Quangyou as saying. "We must strengthen the construction of honest government, firmly curb unhealthy tendencies and root out corruption," Fu told a meeting in Beijing aimed at boosting recruit quality. "Toward the problem of illegality and indiscipline in recruitment work ... no matter what rank is reached or who is involved, we must investigate thoroughly and deal with it strictly," he was quoted as saying in the front-page report. The Liberation Army Daily, the official military mouthpiece, gave no details of graft in the drafting process, but some Chinese believe recruiting standards have slipped during almost two decades of economic and social reform. Beijing leaders regularly demand crackdowns on official graft, calling it a scourge that threatens the very basis of the Chinese Communist Party's rule. Reasarch was needed into the new problems posed to recruitment by China's switch from central planning to a market economy, Fu said. Concerns about standards in China's uniformed services were heightened in February, when a 19-year-old member of the paramilitary People's Armed Police stabbed to death a senior parliament official whose Beijing home he was supposed to be guarding. 2417 !GCAT !GDIP China sent a senior official to attend a reception at the Ukraine embassy on Friday despite a diplomatic rift over a visit to Kiev by Taiwan's vice president Lien Chan. But an apparent guest list mix-up left both sides unsure over who would represent Beijing at the reception, held to mark Ukraine's independence day. Ukraine's ambassador thought Chinese Vice-Foreign Minister Tian Zengpei would attend, but the Chinese thought it was Vice-Foreign Minister Zhang Deguang. Zhang, however, fell ill and Vice-Foreign Minister Tang Jiaxuan showed up instead. The confusion followed Taiwan Vice President Lien Chan's three-day trip this week to Ukraine which infuriated Beijing. "It was a misunderstanding...a mix-up," Ukrainian Minister-Counsellor Leonid Leshchenko told Reuters, referring to the guest list. Asked if he saw it as an intentional slap on the wrist, Leshchenko shook his head and said: "No, no no." A Chinese Foreign Ministry protocol officer said Tian, the vice-minister that the Ukrainians were expecting, was abroad. Ukrainian diplomats noted that Tang, the vice-minister who attended, was filling in for Tian as the acting first vice-minister and was actually higher in rank than the person who fell ill. Ukraine's Ambassador Anatoly Plyushko emerged from a half-hour chat with Vice-Minister Tang, and said the vice-minister told him that China attached "great attention to bilateral relations" and "hoped to continue to develop" ties. Plyushko said the vice-minister did not raise the issue of Lien's three-day Kiev visit. "All Chinese guests...invited came," Plyushko said. "This is evidence...(of) their attitude towards our relations. I'm optimistic." The atmosphere was less pleasant on Wednesday when the Chinese Foreign Ministry summoned Plyushko to protest against Lien's trip. China regards Taiwan as a rebel province with no right to conduct foreign relations on its own, and has sought to push it into diplomatic isolation since a civil war separated them in 1949. The former Soviet republic of Ukraine recognises China but not Taiwan. In apparent retaliation against Lien's visit, Chinese State Councillor Li Tieying, a member of the powerful Politburo of the ruling Communist Party, has postponed a visit to Ukraine. In Kiev, Ukrainian Foreign Minister Hennady Udovenko took a shot at Beijing on Thursday, saying China had over-reacted to Lien's visit and calling Beijing's protest "out of proportion". 2418 !GCAT !GVIO A South Korean prosecutor on Friday branded this week's violent student protests as an act of terror and blamed a student group he said supported North Korea's aim of a Communist takover of the entire Korean peninsula for them. "The students initiated the confrontation by attacking the riot police who were simply keeping guard. They swung iron bars, threw molotov cocktails and destroyed 12 riot police buses," state prosecutor Koh Young-ju Koh told a news conference. Nine days of pro-unification agitation at Seoul's Yonsei University masterminded by the outlawed Korean Federation of University Student Councils ended on Tuesday when riot police stormed a teaching block used by the students as a stronghold. Hundreds of riot policemen and students were hurt in pitched battles and 3,499 students were detained. On Wednesday a young police officer died of head wounds, becoming the first fatality. "This was an act of terror, not just another demonstration," said Koh, the public security planning officer at the Supreme Public Prosecutor's Office, outlining the government's legal case for a crackdown on the federation. "We see the students' actions as activities that benefit the enemy," Koh said, thus putting the federation in breach of the National Security Law designed to prevent communist subversion by Pyongyang. South and North Korea have remained technically at war since their 1950-53 conflict ended in a truce. Koh said the federation was dominated by anti-American radicals who believe Washington is blocking Korean unification and want U.S. military forces expelled from the South. "They also explicitly support North Korea's unification formula, which in fact is designed to communise the entire Korean peninsula," he said. The students support the North's vision of a reunified Korea with both governments intact, and slogans and songs adopted by the Yonsei protesters also echo Pyongyang's propaganda line. Two federation leaders are now staging a hunger strike on the North Korean side of the Panmunjom border crossing village in support of their arrested colleagues in Seoul. Koh said arrest warrants have been issued for three of the federation's top leaders, while a fourth was in custody. Police are also hunting for two federation members who held senior positions last year. Koh said the public uproar against the students' violent tactics encourged the police to storm the campus on Tuesday to put an end to the worst campus unrest since President Kim Young-sam took power in 1993. "We have received endless phone calls from the public expressing outrage over the lack of government action to punish the violent students," said Koh. He cited a poll conducted by the Ministry of Information during the unrest that showed 80.2 percent of the public wanting the government to crack down on the students. "People have looked aside, thinking the young, small in number students can do no harm," Koh said. "But look at what they have done now. They have the force of an army, and when the number increases no one can tell what kind of force they'll possess," he said. On Thursday, the cabinet vowed to break up student rallies and prevent illegal protests from going ahead. Earlier, President Kim accused radical students of waging urban guerrilla warfare in support of Pyongyang and vowed to sternly punish North Korean sympathisers. 2419 !GCAT !GDIP Australia said on Friday that it had signed an agreement with Beijing allowing its consulate-general in Hong Kong to remain open beyond the colony's return to China in 1997. The agreement reflected Australia's long-term commitment to Hong Kong, the consulate-general said in a statement. In 1995-1996, Australian exports to Hong Kong grew by 16 percent to more than A$3 billion, it said. --HONG KONG NEWSROOM (852) 28436441 2420 !GCAT !GPOL The Philippines' population rose to 68.614 million as of September 1995, according to census data released by the National Statistics Office (NSO) on Friday. The new count showed an increase of 7.91 million people over the 1990 census figure of 60.7 million. The Philippines' population growth rate declined in the first half of the 1990s to 2.32 percent annually, the NSO said. The growth rate was 2.35 percent from 1980 to 1990, 2.71 percent from 1975 to 1980 and 2.78 percent from 1970 to 1975. 2421 !GCAT !GDIP President Lee Teng-hui on Friday urged China to face the reality of politically estranged Taiwan and sit down to talk, and said his island would not halt its drive for broader international ties. "It is a fact that both sides have been under separate rule for nearly half a century," Lee, who doubles as chairman of the ruling Nationalist Party, told a two-day party congress. The Nationalists, with 2.6 million members, have ruled Taiwan since their Republic of China government was defeated by the communists in a civil war in 1949 and fled to the island. "Both sides should face reality, with utmost sincerity and patience, to carry out communication and dialogue...so that we can resolve the problem of national reunification," Lee said. Lee nonetheless stood firm on the island's drive to seek wider "international living space" in the face of Beijing's efforts to isolate Taiwan diplomatically. "We will continue to expand our friendly cooperation with countries all over the world, to participate in international organisations of all kinds," Lee said. The exiled Republic of China government on Wednesday kicked off its latest bid for a United Nations seat despite the certainty of a Chinese veto. On Thursday, Taipei and Beijing each called for a resumption of talks broken off more than a year ago, although China's anger over Taiwan Vice-President Lien Chan's secret mission to Ukraine cooled hopes for any breakthrough. Lien said on his return to Taipei on Thursday that he had met people of all levels during his private Kiev visit, but declined to confirm Taiwan media reports he had met Ukraine's president and agreed to an exchange of representative offices. Ukraine, which recognises Beijing, denied that Lien had met President Leonid Kuchma. Beijing regards Taiwan as a renegade province not entitled to foreign ties and has scorned even allies whom it sees as giving political quarter to the island's leaders. In a report to the party congress, Lien expressed Taipei's concern over the future of Hong Kong after its mid-1997 handover to China rule and said talks with Beijing on transition-related issues should begin as soon as possible. "The government has paid close attention to the status of Hong Kong after 1997," said Lien, who is also premier or cabinet chief and vice chairman of the Nationalist Party. "Increasing economic and trade exchanges with Hong Kong and Macau...not only will boost economic development but also promote cooperation and prosperity in the Asia-Pacific region." Taiwan can adopt flexible policies to maintain and expand ties with post-1997 Hong Kong, Lien said without elaboration. Nationalist delegates were scheduled to discuss reforms to boost the party's appeal, party officials said. The Nationalists' once-absolute power has weakened under a liberalisation begun in the 1980s, which saw legalisation of opposition parties and a gradual adoption of popular elections for all key posts -- even the state presidency. The Nationalists now hold only a razor-thin majority in the Legislative Yuan, or parliament, and have launched a major drive to make themselves more attractive to voters. Taiwan's main opposition is the pro-independence Democratic Progressive Party. But growing numbers of young, well-educated Taiwanese have turned to the New Party, formed in 1993 by disgruntled members of the Nationalist elite who accused the ruling party of stalling on internal reforms. 2422 !GCAT !GPOL !GVOTE Twenty lawmakers in South Korea's parliament could lose their seats after the election watchdog filed complaints with prosecutors on Friday over voting irregularities. The Central Election Management Commission said it had reported 351 people in connection with suspected violation of election laws during general elections in April. "Twenty incumbent lawmakers were involved. If they are found guilty, they could lose their jobs," a commission spokesman said. Under investigation were thirteen lawmakers from the ruling New Korea Party, three from the major opposition National Congress for New Politics, two from the United Liberal Democrats, one from the Democratic Party and one independant. In theory, the number of seats held by the ruling party could fall to 139 from the current 152 in the 299-seat National Assembly. But it would retain a majority, if not an absolute majority, as the major opposition party now holds 79 seats. The commission official said many violations concerned campaign spending limits. President Kim Young-sam has said he will not tolerate any election violations. His anti-corruption drive has led to the sacking of hundreds of civil servants and put two former presidents, Chun Doo Hwan and Roh Tae-woo, on trial for amassing huge slush funds. 2423 !GCAT !GCRIM China on Friday hailed the success of its "Strike Hard" anti-crime campaign, but said the battle was far from over. "The 'Strike Hard' battle of the last several months has had a huge impact and excellent results," the Communist Party mouthpiece People's Daily said in a front-page commentary. The "Strike Hard" campaign was launched in April to restore public confidence in the government amid a rising tide of crime that has aroused widespread popular resentment. But the success of the highly publicised campaign -- in which more than 160,000 people have been arrested and more than 1,000 executed -- should not be overestimated, the newspaper said. "In some places, brazen and arrogant criminals have not yet been put down...some fugitives have not yet been apprehended, some gangs have not yet been smashed," the newspaper said. Rapid economic growth and changing values stemming from nearly two decades of market reforms had led to a rise in criminal activity, the Xinhua news agency said in a report late on Thursday. "The expectation that all (security) problems can be solved by anti-crime campaigns alone is unrealistic," Xinhua said. "A new social mechanism which can effectively control those problems has not emerged." Xinhua said police would try to improve crime prevention and strengthen grassroots crime-fighting efforts. "We have to mobilize the whole society for the comprehensive management of security and wage a long-term battle against crime," Xinhua said. "In short, the task is still quite formidable," the People's Daily said. 2424 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Unionised workers of Hyundai Pipe Co Ltd, a unit of South Korea's Hyundai Group, rejected in a vote on Friday afternoon a tentative wage agreement reached with the management earlier that day, a company official said. The management and union leaders had tentatively agreed on a wage increase of 8.66 percent this year, the official said. "The accord was rejected by 81.7 percent of the voters," he said. "Operations of our production lines will remain suspended until the end of the week." The official said the union planned a meeting on Tuesday to decide on future steps. -- Seoul Newsroom (822) 727 5643 2425 !C12 !CCAT !GCAT !GCRIM !GVIO Cambodia's Supreme Court on Friday fined and jailed outspoken former editor Hen Vipheak on charges of spreading disinformation but allowed his paper to keep publishing. Judge Chan Sok upheld rulings by the municipal and appeal courts that handed down a fine of five million riels (US$2,000) and one year's imprisonment, but he overturned a decision to shut down Hen Vipheak's newspaper, Sereipheap Thmei (New Liberty). Police took Hen Vipheak to the capital's run-down T3 prison and he must now hope that co-Premiers Prince Norodom Ranariddh and Hun Sen will support an amnesty promised earlier this year by King Norodom Sihanouk. Hen Vipheak, a member of the opposition Khmer Nation Party (KNP), is the second journalist to be jailed under the coalition government formed in 1993. Sihanouk offered an amnesty to fellow KNP member Chan Rattana, former editor of Voice of Khmer Youth, after he was jailed for a year in June for defaming the premiers. He was released a week later when Ranariddh and Hun Sen approved the amnesty. The king had promised an amnesty to a third newsman, opposition publisher Thun Bunly, but he was shot dead in May before his case came to court and the KNP claimed the unsolved killing was politically motivated. Judge Chan Sok ruled that a May 1995 article in Hen Vipheak's weekly paper, entitled "Cambodia, the country of thieves" and alleging top-level corruption, had insulted the country's leaders and the nation. Hen Vipheak, whose newspaper office was attacked by alleged supporters of Hun Sen in October last year, argued that the article was legitimate opinion as it was a letter from a reader. He issued a statement on Thursday predicting the Supreme Court would uphold the lower court decisions, including closure of the newspaper, "as the plot to jail me had already been staged". It said his detention and closure of the paper would "show that those who are in power have moved another step towards the elimination of the freedom of expression guaranteed by the constitution...and by the Paris peace accords (of 1991)." The judge upstaged part of this prediction by allowing continued publication of the paper, one of a handful that reflect the views of the KNP, which is not recognised by the government. 2426 !GCAT !GCRIM Burmese officials have uncovered four heroin refineries and seized a large amount of chemicals used to produce drugs on the nation's border with China, official media reported on Friday. "A combined anti-drug enforcement team comprising army members, Defence Services Intelligence agents and police seized chemicals used for refining heroin," state-run newspapers said. The reports said authorities, acting on a tip-off, raided refineries in a ravine near Shao Phan Village in Kutkai Township, about 1,045 km (650 miles) northeast of Rangoon. The combined forces launched the operation on August 7 and seized four refineries, 39 huts and a large amount of chemicals used to convert opium into heroin, as well as 20 gallons of raw opium liquid. The seized chemicals were destroyed, the newspapers said. Burma is the world's largest source of illegal opium and its more refined derivative, heroin. 2427 !GCAT !GDIS A family of three, including a pregnant woman, has been killed while crossing the tracks in front of Vietnam's north-south "Unification train". Police in a district to the south of Hanoi said on Friday the family had been knocked down as they attempted to cross the tracks at a point where the oncoming train was hidden from view. The accident happened on Wednesday and further details were not available. Vietnam's Unification train is the name give to the service which runs between Hanoi and Ho Chi Minh City, the former South Vietnam capital. Accidents on Vietnam's old rail system are commonplace. Trains are slow-moving and people have been killed after falling asleep on the tracks. 2428 !GCAT !GCRIM Bangkok's criminal court on Friday ordered a warrant for the arrest of the Australian-born daughter of a Hong Kong-based businessman after she failed to appear to face drug-trafficking charges. Lisa Marie Smith, 20, who carries Australian and British passports, was arrested at Bangkok airport on February 13 after she was found with four kilograms (8.8 pounds) of a substance police originally thought was opium but later said was cannabis and 565 amphetamine tablets. Smith, the Melbourne-born daughter of Terry Smith, chief of insurance giant National Mutual Asia, was released on 1.5 million baht bail (US$59,500) in June, becoming the first foreigner facing drug charges to be released on bail. Her lawyer was not immediately available for comment. Soon after her arrest, Smith told reporters she had been tricked into carrying the drugs to Tokyo by Pakistani drinking friends. But she said she would plead guilty. Smith became the second Australian to evade Thai justice this week. Daniel Westlake, 46, from Victoria made the first successful jailbreak from Klongprem prison in the northern outskirts of Bangkok on Sunday night. He, too, was facing drug charges. Westlake, arrested in December 1993 and charged with heroin trafficking, sawed the iron grill off his cell window and climbed down the prison's five-metre (15 foot) wall on a rope made from bed sheets, a prison official said. Prison authorities ordered that all foreign inmates be chained at night to prevent more breakouts. There are 266 Westerners, including six Australians, in the prison, most awaiting trial on drugs charges. There also are about 5,000 Thai inmates in Klongprem, the prison official said. 2429 !GCAT !GDIS !GWEA Typhoon Niki swept across storm-battered northern Vietnam early on Friday but initial reports indicated the region had been spared further major damage. Voice of Vietnam radio said coastal areas around Haiphong had borne the brunt of the storm as it swept ashore, but an official with the International Federation of the Red Cross and Red Crescent Societies said no major damage had been reported. The capital, Hanoi, where hundreds of residents had to evacuate flooded homes earlier in the week, escaped relatively unscathed with only one reported death, caused by a falling tree. But the IFRC official said it was too early to gauge Niki's impact and said flooding remained a danger as river levels rose. Damage reports from provinces to the north and west of Hanoi were not available on Friday morning. Northern Vietnam has been battered by a series of storms over the past 10 days causing some of the worst damage seen in years. The IFRC official said 119 bodies had been recovered from a devastating whirlwind which ripped through fishing fleets off the coast southeast of Hanoi last week. "We know 119 bodies have definitely been identified. At the moment they are talking about 375 people missing, with 258 of these now believed dead," the official said. Elsewhere in northern Vietnam further deaths and damage were reported and hundreds of residents in the capital Hanoi were evacuated from homes close to the Red River earlier this week. Niki was heading towards the border with Laos on Friday. Forecasters said flooding remained a danger but that the storm was weakening. 2430 !GCAT !GCRIM Bangkok's criminal court on Friday ordered a warrant for the arrest of the Australian-born daughter of a Hong Kong-based businessman after she failed to appear to face drug-trafficking charges. Lisa Marie Smith, 20, who carries Australian and British passports, was arrested at Bangkok airport on February 13 after she was found with four kilograms (8.8 pounds) of a substance police originally thought was opium but later said was cannabis and 565 amphetamine tablets. Smith, the Melbourne-born daughter of Terry Smith, chief of insurance giant National Mutual Asia, was released on 1.5 million baht bail (US$59,500) in June, becoming the first foreigner facing drug charges to be released on bail. Her lawyer was not immediately available for comment. Soon after her arrest, Smith told reporters she had been tricked into carrying the drugs to Tokyo by Pakistani drinking friends. But she said she would plead guilty. Smith became the second Australian to evade Thai justice this week. Daniel Westlake, 46, from Victoria made the first successful jailbreak from Klongprem prison in the northern outskirts of Bangkok on Sunday night. He, too, was facing drug charges. 2431 !GCAT !GHEA A 59-year-old woman died of food poisoning on Friday in western Japan's Nara prefecture, casting a cloud over the country's plans to declare that the threat from a mysterious killer germ was receding. The woman, a housewife from Yamatotakada city who had been hospitalised since last month, was the 11th person to die from the O-157 colon bacillus. News of the death came as Japanese media reported that health officials were preparing to declare next month that the worst of the epidemic was over as the number of new infections had decreased. Health Minister Naoto Kan said on Thursday that there had been no new cases of the disease. The O-157 colon bacillus has been found responsible for a widespread food poisoning epidemic that has also made more than 9,500 people ill this year. The city of Sakai, near Osaka in western Japan, has been hit hardest, with nearly 6,500, mostly school children, affected by the disease. Health authorities believe school lunches are the source of the food poisoning which hit Sakai. But researchers have been unable to locate the exact source of the infection. Raw fish, radish sprouts, meat and cold noodles -- all items served in the lunches -- were suspected and then discounted as the cause of the poisoning. The outbreak has prompted authorities to tighten sanitary standards at slaughterhouses and meatpacking plants and sparked calls for an overhaul of the nation's school lunch programme. 2432 !E41 !ECAT !GCAT !GJOB Taiwan's unemployment rate was 2.97 percent in July, up from 2.6 percent in June and the highest rate in 10 years, a government official said on Friday. July's rate was the highest since joblessness hit 3.11 in August 1986, according to an official report from the Directorate General of Budget, Accounting and Statistics. The bureau attributed the decade-high unemployment to new inflows of both new graduates and summertime job seekers into the labour market and expected the rate to move even higher. "The rate should be even higher next month but could begin to decline in September," a bureau official said. The official gave no specific prediction for the August jobless rate. The number of unemployed people in July was 276,000, up from 241,000 in June, the bureau said. Taiwan had only 180,000 jobless people in July 1995. Employed people in July numbered 9.03 million, up from 9.01 in June, the bureau report said. July 96 June 96 July 95 jobless rate (pct) 2.97 2.60 1.95 -- Taipei Newsroom (5080815) 2433 !GCAT !GCRIM !GPOL Vietnam confirmed on Friday that three prominent dissidents had been sentenced to prison for divulging state secrets, but diplomats and rights groups said the sentences were lighter than expected. The official Vietnam News Agency said Le Hong Ha, a former senior Communist Party member, and leading academic Ha Si Phu had been jailed for two years and one year, respectively. Veteran communist critic Nguyen Kien Giang also received a 15-month, suspended sentence, it said. The trial was closed to foreign journalists. Court sources had indicated earlier that Phu's 12-month sentence also had been suspended. Ha Si Phu has been in jail since late last year and that time will be deducted from his sentence if normal practice is followed. That would leave him behind bars for another three to four months. Le Hong Ha was arrested at about the same time and would face about 15 months in prison if the sentence is not appealed. Vietnam's state media also reported the sentences on Friday without comment, referring only to the sentencing of "three retired state employees". Newspapers said Ha Si Phu and Nguyen Kien Giang had both confessed to obtaining classified documents from Le Hong Ha. Meanwhile, a spokeswoman for the human rights organisation Amnesty International said by phone that it opposed jail terms for people who had expressed political views, but that the terms were not as severe as had been anticipated. "Obviously, he shouldn't be in prison," she said, referring to Le Hong Ha. "But it's good that there's been a suspended sentence." Diplomats and others in Hanoi, who had been looking to the trial for indications of the political mood after the recent Communist Party congress, were quietly upbeat in their reaction. "It's difficult to make a judgement based on just one trial (since the congress)... But it would be good if this is a sign that things are improving," said a senior Western observer. Party congresses are major political events in Vietnam. The late-June congress saw a shake-up of the leadership with the appointment of several security-related personnel to prominent politburo positions. However, the impact of the changes has remained unclear. 2434 !GCAT !GDIP Singapore's patriarch, Lee Kuan Yew, is scheduled to visit China from August 31 to September 11, a Chinese Foreign Ministry spokesman said on Friday. He gave no further details. Lee, who resigned as prime minister in 1990 and now is senior minister, has unrivalled influence with both Beijing and Taipei, arch-rivals since the end of the Chinese civil war in 1949. Tensions between Beijing and Taipei that began easing in the late 1980s have escalated since Taiwan's President Lee Teng-hui made a landmark trip to the United States last year. Beijing regards Taiwan as a rebel province and has sought to push the island into diplomatic isolation. Both Singapore and the United States recognise China but not Taiwan. 2435 !GCAT !GDEF !GDIP !GVIO A United States naval base in Japan received two bomb threats this month, but determined they were nuisance calls, a U.S. Navy spokesman said on Friday. "No bombs were found and the calls were evaluated by base security as nuisance calls," said a spokesman at the Yokosuka Naval Base near Tokyo. Calls saying a bomb had been placed at a club on the base were received on August 9 and on August 19, prompting the evacuation of the club and the closure of the main gate, he said. Patrol officers, however, found no bombs on either occasion, the latest of 10 such calls this year, he said. Anti-base sentiment among Japanese has increased since the rape last year of a schoolgirl on the southern island of Okinawa by three U.S. servicemen stationed there. The anti-base movement, however, has not resorted to violence, instead forming a high-profile political campaign to force Japanese and U.S. authorities to trim the bases. 2436 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Union negotiators of Hyundai Pipe Co Ltd, a unit of South Korea's Hyundai Group, tentatively agreed with management on Friday on a wage increase of 8.66 percent this year, a company spokesman said. He said union members would vote Friday afternoon on whether to accept the accord. "If union workers vote for the agreement, we will be able to resume work next week," he said. Management accepted the union's demand to cut the working week to 42 hours from the current 48 hours. Workers at Hyundai Mipo Dockyard Co Ltd, the group's other unit, have gone on strike since Tuesday for a week-long walkout after wage negotiations broke down. Union and management of Hyundai Mipo were expected to reopen negotiations early next week, a company official said. 2437 !GCAT With 312 days to go before the British colony reverts to China, the Hong Kong media focused on cross straight relations and the economies of greater China. The middle of the road HONG KONG ECONOMIC JOURNAL said China's military threat had failed to get Taiwan to acknowledge allegiance to China, but Beijing had not given up, and had replaced missiles with "money bullets" targetted at the Taiwanese business sector. It said China's decision to start direct shipping links to Taiwan was a piece of fatty pork for Taiwanese businessmen dangled before them in the hope they would persuade their government to give up seeking international recognition. The paper thought Taiwan's recent high-profile diplomatic efforts were very dangerous, because they would give some Chinese leaders better reasons to start a war across the Strait. The HONG KONG ECONOMIC TIMES commented said the interest rate cuts by China's central bank, the People's Bank of China, exceeded market expectations. It said Beijing wanted to create a prosperous economic panorama ahead of the Hong Kong handover and the 15th general conference of the Communist Party next year. It said Hong Kong's finance, trading and retail sectors would benefit from the decision. -- HONG KONG NEWSROOM (852) 28436441 2438 !GCAT !GDEF !GDIP Four Taiwanese air force pilots tested Sukhoi SU-27 fighters in early 1996 in Ukraine to learn the capabilities of the fighters used by rival China, the mass-circulation China Times newspaper reported on Friday. The newspaper quoted unspecified sources as saying the air force sent the four-man team to judge the SU-27 fighters as a reference for Taiwan's anti-air defence after China selected the SU-27 as its leading fighter. An air force spokesman could not confirm the report. "So far, we haven't made any comments on the report," the spokesman said by telephone. The report came soon after Taiwanese Vice-President Lien Chan returned to Taipei on Thursday night from a private visit to Ukraine. Lien spoke with people "of all levels" during the secretive Kiev mission that enfuriated China, but declined to confirm reports he had met Ukraine's president. "I met the people I wanted to meet and discussed the things I wanted to discuss," Lien said on his return to Taiwan when asked to confirm whether he had met President Leonid Kuchma. "In Ukraine, I met people from all levels, specific people, and had a full exchange of views," Lien told reporters at Taipei's international airport. "But I cannot identify who I met by name. That would not live up to the agreement I made before visiting." Lien used similarly coy language when asked to confirm Taiwan media reports, including one in the ruling Nationalist Party's Central Daily News, that Taiwan and Ukraine had agreed to exchange unofficial representative offices. Ukraine, bearing the brunt of China's scorn over the Lien's visit, flatly denied that the men met. But Foreign Minister Hennady Udovenko told Reuters he found Beijing's furious reaction to Lien's visit to be "out of proportion." China delivered a protest note to Ukraine's ambassador in Beijing and cancelled a visit by a high-level delegation. "It wasn't even a visit but a trip, a private journey," Udovenko said of Lien's three-day stay. Udovenko confirmed that Ukraine was interested in developing trade with Taiwan and wanted to open a trade mission in Taipei. Ukraine recognises Beijing, which has regarded Taiwan as a renegade province since China's civil war split them in 1949. Beijing says Taiwan is a Chinese province not entitled to foreign ties and has scorned even allies whom it sees as giving political or diplomatic quarter to the island's leaders. Lien surfaced in Kiev on Tuesday, two days after vanishing in New York following a state visit to the Dominican Republic. 2439 !GCAT !GENT !GPRO To someone known for either the rich classical film scores of 'Last Emperor' and 'Little Buddha' or his innovative work on the synthesiser, Ryuichi Sakamoto's latest incarnation has been a surprise, not least to himself. Dumping orchestra, synthesisers, sequencers and computers, the bleach-haired Sakamoto fronts a stripped-down trio of piano, violin and cello for a tour and album ("1996") that has brought him closer to his audience and also, he says, to himself. "I was a bit afraid that this tour would be a little weaker than the other ones before because we are just three, and without hi-tech equipment, but actually the result is the other way round," he told Reuters in an interview. "This time I have had the strongest reaction I have had in my life, because there is no wall between us so as we get the same vibe from the audience and they get the same thing from us. It's two-way communication." For the striking, softly spoken Sakamoto, whose score for Bernardo Bertolucci's "Last Emperor" won him an Oscar, a Grammy and a Golden Globe, this is unusual territory. Onstage with Everton Nelson (violin) and Jacques Morelembaum (cello) he weaves an atmosphere of intimacy despite the austere surroundings of Hong Kong's Concert Hall. The pieces range from arrangements of his haunting film scores -- "Merry Christmas Mr Lawrence," "Sheltering Sky" and "Last Emperor" -- to Okinawan folk songs and the minimalism and experimentation of new material from "1996". During an improvisatory interlude, Sakamoto leaves his stool to pluck the strings of his grand piano and strikes its wooden sides, clearly enjoying himself alongside his fellow musicians. At other times he throws back his shock of yellow-black hair as he pounds the keys dramatically, or hunches during quieter moments, face disappearing under his fringe as he draws familiar but moving melodies from the upper reaches of the keyboard. For Sakamoto, 44, the collaboration may be a turning point. "This tour has given me something more than I expected and this trio is becoming now more important than I expected, so I am thinking about using this trio in the future, maybe for the next album," he said. If he does it would mark an unusual continuity in Sakamoto's eclectic musical wanderings. A list of his collaborators reads like a Who's Who of great contemporary pop and jazz musicians, including David Byrne, David Sylvian, Youssou N'dour, David Bowie and Iggy Pop. He has also acted in two of the movies he wrote music for, as well as allowing his good looks to sell clothes for Barney's and Gap. But for the classically trained Sakamoto, his music remains a journey of discovery that has taken him through styles as diverse as Brazilian, Indonesian, techno and the rhythms and instrumentation of traditional North Africa. And, while he maintains contact with many of those he has worked with, sometimes playing alongside them later, he says this musical journey is a very personal, solitary one. "I am seeking my own style...one I can say 'this is Sakamoto style, this is my style... So until then I have to try many things," he said. Does he feel he has reached that point? "It's not perfect enough, no. It's maybe 80 percent. Because I have tried many things, and now I know this is good, this is bad, this is useful, this is not. But still there are many things I haven't done, so I would like to try more," he said. While this tour, which took in Europe, Asia, Australia, Japan and the United States, has highlighted his skills as a pianist, Sakamoto said there was little chance of him forsaking permanently the technical gadgetry of the modern keyboardist. "I still love it. I am a fanatic of computer technology, the Internet, digital recording systems and so on," he says. Indeed, Sakamoto is true to his roots as an early dabbler in synthesiser technology, hooking himself up for this tour to the Internet to offer some of the first live concert broadcasts through the medium. So where does he see music, and in particular synthesiser music, going? Is melody, composition and originality in danger of disappearing under the weight of sampled music, monotonous pulse-driven dance music and recycled songs of yesteryear? Sakamoto, fresh from a concert in China, thinks not. "When I was in Beijing I was coming into the city from the airport and I was looking outside the bus. There was blue sky, trees, flowers and birds; cars and highways too. But nature is always there and I was convinced the future of music won't be different," he said. "I will still be moved listening to Mozart, when I get to 60 or 70; in 10 or 20 years' time it won't be different." 2440 !GCAT !GDIP !GPOL Prime Minister Benjamin Netanyahu told Egypt on Thursday that Israel would resume negotiations with the Palestine Liberation Organisation shortly. He had apparently been shaken by remarks by Egyptian President Hosni Mubarak suggesting that Cairo was having second thoughts about hosting a Middle East economic summit scheduled for November. "The prime minister informed President Mubarak about the track which is planned in the talks with the Palestinians which are to be opened in the very near future including via the steering committee," Netanyahu's office said. Its statement said Netanyahu spoke to Mubarak by telephone but it gave no date for a resumption of formal talks. The steering committee is the forum which negotiates political matters. Mubarak, speaking to academics in the Egyptian city of Alexandria, said earlier the world could not keep waiting for the right-wing Israeli government that took office in June to make up its mind about its next step in the peace process. "For the past two months they've been saying we're committed to our obligations, but when? The Palestinians and the world are not going to wait 10 months or a year," Mubarak said. "We have an economic conference coming up and I've told the Israelis that no progress in the peace process will hit the Middle East economic summit because not many countries will attend. That's what we're worried about." But the Israeli statement said: "The prime minister understood from the president that he intends to hold the conference as scheduled. The two agreed to remain in constant contact with each other." Palestinian officials confirmed that Mahmoud Abbas, a senior PLO official also known as Abu Mazen, held talks with Netanyahu political adviser Dore Gold in Tel Aviv on Thursday. They gave no details, but Israel's army radio said Gold and Abbas discussed a resumption of the steering committee talks. Israel's Itim news agency said Netanyahu met Dan Shomron, the former army chief of staff who will head Israel's delegation on the committee, to discuss Israel's positions. The Israeli government has not yet taken a decision on redeploying troops in the West Bank town of Hebron, which should have taken under an agreement reached between the PLO and the previous Israeli government. Arab states and the Palestinians regard Netanyahu's approach to the Hebron deal as a litmus test of his peace intentions. Netanyahu is reviewing the Hebron agreement and his defence minister has revised the plan. Netanyahu wants to discuss the new plan, once it is complete, in the steering committee. The Palestinians insist they will not renegotiate the deal. Israel has also said it will not implement the deal until the Palestinian Authority closes offices it is operating in Arab East Jerusalem in violation of the 1993 peace deal setting up Palestinian self-rule in parts of the West Bank and Gaza Strip. Palestinian President Yasser Arafat has rejected the condition. 2441 !GCAT These are the leading stories in the Moroccan press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. LE MATIN DU SAHARA - Interior Minister Driss Basri to head delegation touring Western Sahara next week in attempt to tackle unemployment crisis. L'OPINION - Staff of leading bank Societe Generale de Banque involved in shares embezzlement. ALMAGHRIB - Europe tightens measures to curb immigration. LIBERATION - Tourism flourishing in Spain while crisis lingers in Morocco. AL-ITTIHAD-AL-ISHTIRAKI - End of deadline to normalise situation of illegal immigrants, most of them Moroccans, wishing to settle in Spain. 2442 !GCAT !GDIP Tunisia is seeking intensified efforts to clear hurdles blocking the Middle East peace process, the Foreign Affairs Ministry said in a statement published on Friday. It said Foreign Affairs Minister Habib Ben Yahia on Thursday met the U.S., French, British, Chinese and Russian ambassadors in Tunis, as well as representatives of the European Union, Germany and Japan. The move follows complaints by Palestinian President Yasser Arafat at a meeting on Wednesday with Tunisian President Zine al-Abidine Ben Ali over "difficulties" in the peace process due to the policy of the new Israeli government headed by Prime Minister Benjamin Netanyahu. Ben Yahia urged intensified efforts "to secure the continuation of the peace negotiations in all their parts, to protect them from any hurdle and avoid the dangers which would result from a freeze of the peace process," the statement said. 2443 !GCAT These are some of the leading stories in the Jordanian press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. AL RAI - King Hussein meets lower house of parliament, urges dialogue, cohesion and sense of belonging to build future. - King calls for setting up applied university in Balqa governorate, prince Ghazi named chairman of its board of trustees. - The start of 1996 scholastic year postponed for a week. - Prime Minister Abdul-Karim al-Kabariti promises to release detainees. - IMF allows Jordan to withdraw $60 million in development credit. AD DUSTOUR - House speaker says deputies loyalty is for king and country. Several deputies praise meeting with king. 2444 !GCAT These are the leading stories in the Turkish press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. SABAH - The deputy head of the Privatisation Administration vows to push ahead with the privatisation scheme which has been stalled for years. MILLIYET - Turkish tycoon Sakip Sabanci criticises the free car import regulation introduced by the Islamist-led government. - The EgyptAir Boeing 707 accident in Istanbul airport on Wednesday was a result of poor runway conditions. HURRIYET - The chairman of the leading opposition Motherland Party (ANAP) Yilmaz vows to introduce changes within the party ahead of the party congress this weekend. CUMHURIYET - More mobile phone service licences are to be sold before the privatisation of the state telecommunications company Turk Telekom. YENI YUZYIL - The second big textile and readywear international fair of the year starts in Istanbul. DUNYA - Athens bans import of Turkish agricultural products because of concerns about foot-and-mouth disease. ZAMAN - The Islamist-led government's coalition partners contradict each other over the reasons for calling an extraordinary session of parliament. 2445 !GCAT These are the leading stories in the Tunisian press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. LA PRESSE - President Ben Ali recommends implementation of programmes of vocational training to help modernise the economy. - Tunisia negotiating the export of 15,000 tonnes of tomato puree to the European Union. Tomato production reached a record 540,000 tonnes this year. Tomato puree production expected to reach 98,000 tonnes. LE TEMPS - President Ben Ali recommends more efforts to limit road accidents. 2446 !GCAT !GDIP A Middle East economic conference planned for Cairo in November may not take place on time, the Egyptian government newspaper al-Ahram said on Friday. Even if it does take place, it will be doomed to failure unless Israel changes its attitude towards its neighbours, al-Ahram editor Ibrahim Nafie said in a front-page editorial. In a speech on Thursday, Egyptian President Hosni Mubarak showed signs of cold feet about the conference, saying many Middle East states would not attend unless Israel ensured that the Middle East peace process moved forward. The conference, designed to promote economic integration in the region, would then be pointless, Mubarak said. Israeli Prime Minister Benjamin Netanyahu called Mubarak later on Thursday and assured him that Israel would resume negotiations soon with the Palestinians. The al-Ahram editor, a pillar of the Egyptian ruling establishment, said that normal relations with Israel would not be possible if the present stalemate and tension continued. "Whether the conference takes place on time or not, Israel's settlement activity and its failure to meet its commitments will make the failure of the conference inevitable," he said. "In this case Israel must bear full responsibility for its failure if it (the conference) does convene," he added. Nafie said Netanyahu was repeating what he called a historical mistake made by earlier Israeli governments. "The mistake is to imagine that there can be peace in the region without hard work...in the erroneous belief that the other parties are just lifeless corpses or that Israel's relations with the Washington can be an alternative to cordial and normal relations with the states of the region," he said. 2447 !GCAT These are the leading stories in the Greek Cypriot newspapers on Friday. Reuters has not verified these stories and does not vouch for their accuracy. ALITHIA -Early general elections in Greece following Greek Prime Minister Costas Simitis suggestion. -President Clerides suggested to U.N. secretary-general's resident representative to Cyprus Gustave Feissel that nothing must be decided under pressure and before the Greek elections. CHARAVGHI -Ideas for improvements in the Cyprus Election Law and proceedures. CYPRUS MAIL -Government backs Committee for Missiong Persons after an Amnesty International report called for a more effective replacement. PHILELEFTHEROS -Cyprus Airways unions have "frozen" their activities. They fear that the airline will have some of its planes grounded and a number of its employees laid off. SIMERINI -Government is considering the need for an increase in the defence levy following a report from Defence Minister Costas Eliades. 2448 !GCAT These are the leading stories in the Egyptian press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. AL-AHRAM - President Mubarak warned that it would be difficult to hold the Cairo economic summit if no progress was achieved in the Middle East peace process and if Israel does not carry out its commitments. He called on Israel to bring about progress on the ground, otherwise the conference would be pointless, in that the states of the region would stay away. He said he was surprised at demands that the Egyptian armed forces give up their missiles, saying the demand should apply to all states in the region. Egypt's missiles are within international agreements and Israel has missiles with a longer range, he said. - Mubarak had telephone calls from the Emir and the Crown Prince of Kuwait. He had a telephone conversation with Palestinian President Yasser Arafat. Israeli Prime Minister Benjamin Netanyahu called Mubarak and they discussed promoting the peace process and implementation of old agreements. AL-AKHBAR - President Mubarak said there was no going back on free education and the private universities do not mean a retreat from this principle. He said that work was under way on 3,556 projects with an investment of 50 billion pounds ($15 million). - President Mubarak met Japanese Foreign Minister Yukihiko Ikeda and discussed promoting Japanese investment in Egypt and Japan's contribution to the bridge over the Suez Canal, 60 percent of the costs of which Japan will pay. - The technical committee of the Egyptian civil aviation authority has started examining the EgyptAir plane which had an accident at Istanbul airport on Wednesday. AL-GOMHURIA - Mubarak's speech. - Foreign Minister Amr Moussa will begin an African tour on Tuesday, covering Tunisia, Mauritania and Nigeria. AL-WAFD - The courts have referred to the constitutional court a presidential decree requring contractors to pay sales tax. - The head of the state holding company for pharmaceuticals said the state would not sell all shares in its pharmaceutical companies, but only 40 percent of them. $1 = 3.40 pounds 2449 !GCAT !GWEA "I think God will send us to paradise. He would not put us in hell twice!" said el-Sharqawi Ahmad, an Egyptian labourer sweltering in Kuwait's summer sun. "Your excellency can fry an egg on my head," he told a reporter, pointing to a sweating, hairless spot on the top of his head normally protected by a white cloth soaked in water. Sizzling Kuwait City is the hottest capital in the Gulf in midsummer, with temperatures in the shade regularly over 50 degrees Centigrade (122 Fahrenheit). Kuwaiti officials say that from June to September the oven-like climate makes their city the hottest in the world and creates a lifestyle supremely dependent on the air conditioner. "It's like a sauna -- daily and free of charge!" civil servant Najla al-Fawzan said. Residents have developed precautions, many involving cars, to beat the worst effects. Newcomers learn not to touch any vehicle or anything metal left for long in the sun. Some drivers use gloves to protect against blistering steering wheels. Motorists are told not to leave any living thing -- from babies to pets to potted plants -- in cars parked outdoors because they will start to bake. And going barefoot on hot sand will result in a trip to the doctor. "My baby looks as red as beetroot after a five-minute drive to market in the summer," said Huda, a Syrian housewife. A resident who had to push his American car after it broke down badly burned his hands on the bodywork's hot metal and needed medical attention. The best swimming pools in Kuwait are chilled, not heated. And doctors warn people not to swim in daylight to protect themselves from potential skin cancer and blisters. Trying to take a cold shower is no solution -- the chances are that both hot and cold taps will spew out scalding water heated by the sun's onslaught on rooftop water tanks. Night brings little relief to anyone outdoors. Downtown, heat stored up in the day radiates powerfully out of concrete skyscrapers directly onto sweating pedestrians. In the desert, dust and intense heat combine to form a sweaty, itchy hell. "The burning, fiery wind seems to scorch the very eyeballs," British diplomat Harold Dickson wrote in the desert in 1936. But despite the country's annual grilling most of the 1.8 million residents manage to live comfortably thanks to round-the-clock air conditioning and the extreme aridity in summer. Houses, cars, buses, shops, a pedestrian bridge -- even army tanks and battle vehicles -- are air conditioned. Car purchases are often decided on their air conditioning power. Sunstroke deaths are rare as nationals wear sensible, loose white robes and headcovering to curb the sun's rays. And while Kuwait's temperatures are higher, other Gulf states often endure equal discomfort because the greater humidity of their climates raises the head felt by the body. Relief comes in winter when Kuwait's climate of extremes makes it the coldest Gulf capital, with temperatures below 10 degrees Centigrade (50 Faherinheit). The importance of air conditioning is reinforced in very rare summer power blackouts, a disaster that happened for several days in the mid-1970s and again once in the mid-1980s. The universal solution is to abandon home or office and sit in air conditioned vehicles with the engine running. In the blackouts parents had to drive heat-distressed young children around for hours in the evening to try to get them to sleep. Most Kuwaitis spend the summer abroad to avoid the hottest months of July and August -- only to complain about the heat in London and Paris, where air conditioning is less common. Asian and Arab outdoor labourers are not so lucky. They usually work eight hours a day, sometimes in direct sunlight. "We live in an oven. It's so hot it burns our face and there is no relief until late at night, and only then if there is a breeze off the water," said a Bangladeshi fisherman in a corrugated iron shanty village at Doha north of the city. Some doubt official temperatures. A Canadian was shocked to see a private gauge read 58 degrees Centigrade (136 Farenheit) on a July day when the official reading was just 47.2 (117). But Kuwait does not set a temperature at which businesses and state offices must shut. Labour law says work should stop only in unspecified "extraordinary circumstances". And to some, heat means profit. Haji Amin, an Iranian grocer who stays indoors for most of his day, chuckles: "I sell more ice cream, soft drinks and mineral water in the summer." 2450 !GCAT These are the leading stories in the Beirut press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. AN-NAHAR -President Hrawi launched the toughest attack against the Lebanese who boycotted the parliamentary elections. -Former MP Mokheiber who lost in the Mount Lebanon elections called for Hrawi's resignation and said he would appeal the elections results to the Consitutional Council. -Former Prime Minister Hoss announced an incomplete electoral list. AS-SAFIR -Russian ambassador in Lebanon: We are contacting the parties concerned to ease tensions in the Middle East. -The consolidated balance sheet of Lebanon's commercial banks' rose 8.66 percent in June. AL-ANWAR -Minister of Interior Murr: I will not resign and will supervise election. -Prime Minister Hariri to declare his electoral list within 24 hours. AD-DIYAR -An Iranian delegate in Damascus to mediate between Amal movement and Hizbollah. NIDA'A AL-WATAN -Minister of Economy Jaber: We will go through a harsh economic phase. 2451 !GCAT !GVIO An Iraqi Kurdish guerrilla group has claimed a major victory over a rival Kurdish militia which it says is being supported militarily by Iran in fighting in the mountains of northern Iraq. The Kurdistan Democratic Party (KDP) of Massoud Barzani said in a statement on Thursday night that its forces had halted an Iranian-backed attack by thousands of Patriotic Union of Kurdistan (PUK) fighters. "The PUK force were defeated and chased all the way to the Iranian border," the statement said. KDP said the fleeing PUK fighters left a large amount of weapons and ammunition on the battlefield and suffered "a major military defeat". Around 400 PUK guerrillas were killed, wounded or taken prisoner, it said. The PUK, led by Jalal Talabani, was not immediately available for comment. Fresh fighting between the two groups, rivals for decades, broke out last weekend and shattered a 17-month ceasefire brokered by the United States. The KDP has accused neighbour Iran of laying down artillery barrages in support Talabani's group and allowing its rivals to use Iranian territory. The PUK denies backing from Tehran. The clashes are taking place in a Kurdish enclave protected from Baghdad by a U.S.-led air force based in southern Turkey since shortly after the 1991 Gulf War. Washington has urged the rival Kurdish parties to stop fighting and accept a U.S. invitation to peace talks in London. Northern Iraq has been split into rival Kurdish zones since fighting broke out between the two groups in 1994. Around 3,000 people died until the ceasefire last March. 2452 !GCAT These are some of the leading stories in Israeli newspapers on Friday. Reuters has not verified these stories and does not vouch for their accuracy. HAARETZ - Security source: Arafat's distress has led to formation of Arab front against Israel. - Plans for Israeli National Security Agency cancelled after Defence Minister Mordechai objects. - Israeli labour and social welfare minister proposes transit camp to hold illegal foreign workers waiting for expulsion. - Opposition leader Peres in Gaza: I came to advance the peace process, not to attack the Israeli government. - Unilever in preliminary contacts to buy Sunfrost from Clal. MAARIV - Netanyahu telephoned Egyptian President Mubarak last night and promised resumption of negotiations with Arafat. - Interior Ministry intends to deport 2,000 foreign workers each month. - Hebron redeployment decision to be taken in a week or two. YEDIOTH AHRONOTH - Netanyahu telephoned Mubarak to say Israel would resume talks with Palestinians soon. - Cabinet to discuss today setting up transit camps for foreign workers. - Egypt announces it stopping negotiations with Israel on sale of natural gas over "unrealistic" prices proposed by Israel. GLOBES - Sheraton buys 50 percent of Koor Hotels and Leisure and will run the hotels. - Israel and Jordan to open negotiations on improving trade accord. - Sharp slowdown -- 35 percent drop -- in housing starts in first-half 1996. JERUSALEM POST - Mubarak threatens cancellation of Cairo economic summit in November. - Netanyahu: Government will discuss Hebron with Palestinian Authority soon. - Cabinet to examine plan to deport up to 100,000 foreign workers. - Peres, Arafat meet at Erez crossing point between Israel and Gaza. 2453 !GCAT !GCRIM Giovanni Brusca, once one of Sicily's most feared and ferocious Mafia bosses, has begun to testify against the Mob in what could be either a decisive breakthrough or a devious trick. Giancarlo Caselli, chief prosecutor in the Mafia stronghold of Palermo, confirmed to Italian state RAI radio on Friday that Brusca had talked to magistrates. "We will see what the evaluation will be -- positive, negative or neutral," he said, adding that it was premature to say whether Brusca's evidence was genuine. PierLuigi Vigna, prosecutor in the city of Florence, also suggested it would be wise to tread cautiously. "Magistrates must always show caution when such "eminent" figures such as Brusca adopt attitudes like this. There is always the risk, even an abstract one, that strategies other than complete collaboration are in play," he said. Italian media reports said Brusca had named the bosses behind Mafia killings and implicated politicians in what could either be a sensational breakthrough for the police or a deliberate attempt to mislead investigators. Tiziana Parenti, the former head of the parliamentary anti-Mafia commission, cast doubt on Brusca's motives. "I am very concerned...This is a big snare. It shows we don't know anything about the Mafia if only months after an arrest a boss begins to talk," she said. Unlike other "pentiti", or turncoats, Brusca had intimate links to the heart of the Mafia and had been one of Italy's most wanted men until his arrest in Sicily in May. "Brusca's revelations -- which could also link the Mafia and politics -- could throw light on an overwhelming list of crimes," the daily Corriere della Sera reported. Publicly branded "a beast" by another turncoat whose 12-year-old son was allegedly strangled and disposed of in a vat of acid by the boss, Brusca has been charged with several high-profile crimes in Sicily and mainland Italy. Investigators say it was Brusca who pushed the button detonating a bomb under anti-Mafia magistrate Giovanni Falcone's motorcade on a motorway near Palermo in 1992. Falcone, his wife and three bodyguards died in the explosion. He is also accused of involvement in planning 1993 Mafia bombings against cultural monuments in Rome, Florence and Milan, one of which damaged the Uffizi art gallery in Florence. Lawyer Luigi Li Gotti, whose clients include other well-known Mafia turncoats such as Tommaso Buscetta, said he was now representing Brusca who had already given evidence. "He began to collaborate last July, signing the first reports with his declarations on the 26th of that month," the lawyer said, adding that Brusca had been questioned by magistrates in Sicily and the Tuscan city of Florence. Rumours that a top Mafioso had become a "pentito", or turncoat, had been circulating for some time as police made a series of high-profile arrests in Sicily. Pino Arlacchi, a leftist senator and anti-Mafia expert, told the Corriere della Sera that Brusca's decision marked the end for the Corleonesi clan that could lead to boss of bosses Salvatore Riina deciding to give evidence as well. But Arlacchi also urged caution. "The Mafia is not yet beaten. For the moment, only the Corleonesi who have dominated Cosa Nostra for the past 20 years have been beaten," he said, warning that the Mafia was already reorganising on a local level. 2454 !C42 !CCAT !E41 !ECAT !GCAT !GJOB German construction union IG Bau said on Friday it had reached agreement with employers on a new minimum hourly wage of 17 marks in west Germany and 15.65 marks in the east. The union said it hoped the wage would apply from October 1, provided that the level is accepted as binding nationwide. 2455 !GCAT !GPOL !GVIO Police stormed a Paris church on Friday and removed 300 African immigrants, 10 of whom were on a 50-day-old hunger strike in protest against moves to expel them from the country. Hundreds of helmeted police moved in, struggling with sympathisers who had surrounded the Saint Bernard church in the heavily immigrant Goutte d'Or district for several days. Witnesses said they broke down the church's main gate and cleared a barricade of chairs to remove the hunger strikers on stretchers. The protesters' spokeswoman Madjiguene Cisse said they were taken to military hospitals in the Saint Mande and Clamart suburbs. Police cordoned off the area and used tear gas and batons to clear the crowd outside the church as activists confronted them, chanting "French people, immigrants, solidarity". Four ambulances rushed to the scene. Radio reports said some people had blood on their face, but police said nobody had been injured. Police reported that 60 people were briefly detained and six were being held for assaulting police. Witnesses said film star Emanuelle Beart was taken to a police van but officials denied she had been detained. She was among several celebrities, including former Communist cabinet minister Jack Ralite and politician and cancer specialist Leon Schwartzenberg, who had threatened to chain themselves to the protesters to prevent police removing them. Prime Minister Alain Juppe, backed by the country's highest administrative court, said on Thursday there would be no blanket residence permits for the protesters, but the government would consider their cases individually. The head of the Movement agaist Racism (MRAP), Mouloud Aounit, urged Parisians to rush to the church to protest and scuffles continued outside the church after the protesters were removed. Former French United Nations ambassador Stephane Hessel, who is heading a group of self-appointed mediators, called the police raid "scandalous". "It is scandalous to break down a church gate and use violence against distressed people...when negotiatons were about to start," he said. Police moved in at 7.45 a.m. (0545 GMT), wrong-footing the protesters who thought any raid would come at 6 a.m. (0400 GMT), the earliest police can enter a building under French law. The hunger strikers, who like the other protesters have been in the church since June, have been drinking sweet tea and taking vitamin pills, but two are said to be in a serious condition. The decision to send in the police came after Juppe announced in a television message on Thursday that France's highest administrative court, the Council of State, had endorsed his government's view that the 300 Africans were not legally entitled, as a group, to residence permits. But Juppe said the government still intended to review their right to remain in France on a case-by-case basis and had no intention of using deportation to break up families or expel seriously ill individuals. Many of the protesters say they once had residence rights and were plunged into illegality by hardline 1993 immigration laws pushed through by then interior minister Charles Pasqua at a time of mounting anti-immigrant sentiment. Lawyers say loopholes in the laws, which also tightened conditions for citizenship, have created a legal nightmare. Juppe said the law would nonetheless be enforced. But the far-right National Front party, which advocates sending home all immigrants, taunted Juppe for "weakness". "Words yes, but where is the action?" a Front statement said. 2456 !GCAT NEUE ZUERCHER ZEITUNG - Flavio Cotti, Swiss foreign minister and current head of the Organisation for Security and Cooperation in Europe said the OSCE should take action on election manipulations in Bosnia. - Switzerland's road show to promote the country, called "Treffpunkt Schweiz" opened in Leipzig and will be held in nine more German cities. - The Atel Group's six-month profit rose by 18.5 percent to 96 million Swiss francs compared to the same period in 1995. - Galactina Group is selling its children's food, tofu product and nutrition product divisions to Wander AG, a subsidiary of Sandoz. Galactina will concentrate on its core pharmaceuticals and medical technology business. TAGES ANZEIGER - The Swiss Nationalbank intervened on the money market in order to offset an overvaluation of the Swiss franc. - The magazine "Institutional Investor" ranked Union Bank of Switzerland number ten in the world in terms of the amount of capital. JOURNAL DE GENEVE - The Swiss government is putting an article in the constitution on organ transplants in order to better control regulations and distribution. 2457 !GCAT Headlines from major national newspapers. Reuters has not verified these stories and does not vouch for their accuracy. EL PAIS - Colonel Juan Alberto Perote asked general Enrique Rodriguez Galindo for help before implicating him in GAL case EL MUNDO - Popular Party decided after March 3 election to substitute Aleix Vidal-Quadras as party leader in Catalonia and move close to Catalan nationalist coalition CiU ABC - World's top psychiatrists meet in Madrid CINCO DIAS - Bundesbank, eurogenerous EXPANSION - Bundesbank cuts rates and Europe celebrates GACETA DE LOS NEGOCIOS - Bundesbank smooths the path for European economic growth 2458 !GCAT !GPOL !GVIO French police stormed a Paris church on Friday to try to remove 300 African immigrants, 10 of whom are on a 50-day-old hunger strike to protest against moves to expel them from the country. Hundreds of helmeted police struggled with hundreds of sympathisers of the protesters who had surrounded the Saint Bernard church in the heavily immigrant Goutte d'Or district for days. Witnesses said police appeared to have broken down the church's main gate. They used tear gas and batons to try to clear the crowd outside the church as activists confronted them, chanting "French people, immigrants, solidarity". Four ambulances rushed to the scene but it was not immediately clear if anyone was injured. Police cordoned off the area. Prime Minister Alain Juppe, backed by the country's highest administrative court, has said there will be no blanket residence permits for the protesters, but the government will consider their cases individually. Some media celebrities had said they would chain themselves to the Africans to try prevent police from removing them. But film star Emmanuelle Beart, who spent days sleeping in the church, was outside when police intervened. 2459 !GCAT !GDEF !GDIP U.N. inspectors were blocked for hours last week from entering a suspected Iraqi weapons storage site, raising fears the materials may have been moved, a U.N. official reported on Thursday. Rolf Ekeus, head of the U.N. Special Commission in charge of ridding Iraq of weapons of mass destruction, said the incident last Friday was at the same site near Baghdad's airport that inspectors had tried to survey in June. He said his team was accompanied by Iraq's oil minister, Lt. Gen. Muhammed Rasheed, who was allowed to go through a series of roadblocks to the site while the U.N. experts were banned for about two hours. Ekeus said Iraq concealed weapons or related materials by moving them around when inspectors were about to arrive. "They are put on railway cars and trucks and made mobile," he said. "The site can be emptied if we cannot move without being hindered. We have reason to believe it is still continuing." Ekeus spoke to reporters a day before he is due to leave for Baghdad to speak to Iraq's deputy prime minister Tareq Aziz about the standoffs that have been mounting since June as well as other issues. He will arrive in the Iraqi capital on Sunday and stay for three days. He maintained again that Iraq needed to come clean on its nuclear, chemical, biological and ballistic missile programmes, saying some materials were still being concealed. Iraq, he said, contended that the missing items were destroyed but "we don't believe that is the full story." "Some of it was no doubt destroyed but we believe more exists. The matter of concealment is undisputed and must be highlighted," he said. Iraq for the past few months has balked at surprise inspections by arms experts searching for documents or other weapons-related materials, saying the U.N. teams were delving into sensitive national security sites the Special Commission had promised not to touch. Ridding Iraq of its nuclear, chemical, biological and ballistic missile arms potential is a key requirement for lifting stringent trade sanctions imposed after Baghdad's troops invaded Kuwait in August 1990. The Security Council also has given inspectors the right to conduct surprise searches. The council will issue a statement on Friday backing Ekeus in his quest. Members have for months been divided on the continuing sanctions and have not issued a formal statement since June although the alleged violations have occured regularly since then. Friday's statement, which was watered down, warns Iraq that only full compliance with the weapons obligations will result in a favourable report to the council by Ekeus, leading to lifting to sanctions. It demands "once again that they (inspectors) be given immediate, unconditional and unrestricted access to any and all areas (they ) wish to inspect." At the urging of Egypt, Indonesia and other delegations, the statement no longer condemns Iraq for its past actions this summer or spells them out in detail as the United States and Britain had wanted. The blanket sanctions are separate from a so-called oil-for-food deal that is expected to go into force next month, allowing Baghdad to sell $2 billion worth of petroleum over six months to buy badly needed food and medicine to ease the effect of the embargoes. U.N. officials said the oil sales plan could be implemented in the next 10 days but might take longer. 2460 !GCAT !GDIP !GVIO The 300 Africans holed up in a Paris church since June said on Friday they planned to maintain their occupation, following Prime Minister Alain Juppe's refusal to grant them blanket permission to remain in France. Spokeswoman Madjiguene Cisse, one of the 300 in the Saint-Bernard church, said the decision to keep up the protest had been urged by the 10 of them who are on the 50th day of a hunger strike to pressure the government into granting them all residence permits. The decision came after Juppe announced in a television message that France's highest administrative court, the Council of State, had endorsed his government's view that the 300 Africans were not legally entitled, as a block, to residence permits. But Juppe said the government still intended to review their right to remain in France on a case-by-case basis and had no intention of using deportation to break up families or expel seriously ill individuals. Following Juppe's videotaped statement, protesters said they had received several calls warning that police were preparing to eject them early on Friday, although hundreds of sympathisers have surrounded the Saint-Bernard church to protect them. Juppe said the Council of State fully backed his view that the group of protesting immigrants lacked the right to stay in France under 1993 laws tightening conditions for residence. "It would be against the law to give blanket residence permits to this or that group. We are going to continue a review of individual situations," he said. However he added: "It never crossed our mind to expel someone who is seriously ill, separate a mother from her children, break up a couple, or expel parents of children who were born in France or are French citizens." In a possible face-saving way out of their impasse, Cisse, in an interview with Reuters, hinted that the 10 hunger strikers might end their fast should the government give them a written guarantee that they were entitled to residence permits because their refusal to eat had left them seriously ill. Many of the protesters say they once had residence rights and were plunged into illegality by hardline 1993 laws pushed through by then-interior minister Charles Pasqua at a time of mounting anti-immigrant sentiment. Lawyers say loopholes in the laws, which also tightened conditions for citizenship, have created a legal nightmare. Juppe said the law would nonetheless be enforced. But the far-right National Front party, which advocates sending home all immigrants, taunted Juppe for "weakness". "Words yes, but where is the action?" a Front statement said. Signalling their determination to force the government into what would amount to a humiliating retreat, the protesters have called a new rally for next week after a march through Paris drew 5,000 demonstrators on Wednesday. The hunger strikers have been drinking sweet tea and taking vitamin pills, but two are said to be in a serious condition. 2461 !GCAT !GPOL !GVOTE Greece geared up for a month-long election campaign on Friday after socialist prime Prime Minister Costas Simitis, riding high in the polls, called a snap vote to win approval for much needed reforms. "I will tomorrow visit the president of the republic to request parliament's dissolution and ask for elections to be held on Sunday, September 22," Simitis told reporters after chairing a special cabinet meeting on Thursday night. Simitis, 60, is counting on his high approval rating -- about 70 percent -- to win his first public mandate and push forward needed reforms in the country's weak economy and strengthen its defence against rival neighbour Turkey. "We don't need small steps but leaps ahead," he said. "I consider that only a government with a public mandate can deal effectively with challenges of the 21st century." The Greek economy's convergence with those of its European Union partners will be the next government's first priority. Greece is still the worst performer in the 12-member EU despite 10 years of austerity programmes. "Our country must take all necessary measures and decisions so it does not become marginalised in the European Union's political and economic integration," Simitis said. Greek markets marched higher for the third straight day on Thursday after a long period of stagnation in anticipation of the announcement of an early election. The Athens general share index finished 0.76 percent higher from Wednesday's close and more gains were expected on Friday. "The stock market likes the short pre-election period and discounts the election of a strong government that will tackle Greece's structural economic prblems," Yannis Kalogerakis, head of trading at ABN AMRO Axias Securities, told Reuters. Simitis took over as prime minister from late socialist party founder Andreas Papandreou in January and was then elected president of the PASOK party at a congress in June. He sees the future of Greece tied firmly to the EU and to the relief of many western diplomats his prime ministerial style is the antithesis of Papandreou's flamboyant, crowd rousing showmanship. "These will be the most quiet elections in modern Greek history," a government official said. "No big rallies, no plastic flags, no false promises." The conservative opposition New Democracy party accused Simitis of lying to the Greek people because he had said during the congress he would not call an early poll. Conservative leader Miltiades Evert expressed optimism that he would win the elections, but he lags far behind Simitis in polls and is even less popular than many other New Democracy members. Analysts said Simitis had felt that, if elections were held as scheduled next year, he would pay the political cost of unpopular measures such as spending cuts in public services and below-inflation pay rises. His finance minister, Alexandros Papadopoulos, is putting together next year's budget, which includes cuts of $1.2 billion in state spending and a restructuring of public companies to boost growth, expected to exceed 2.5 percent of Greek GDP this year. Papadopoulos has warned that the country is still a long way from meeting the criteria needed to join European Monetary Union (EMU) in 1999 and that in the next two years they must make sacrifices to slash inflation and a towering public debt. 2462 !GCAT !GCRIM Belgian authorities are stepping up their search of properties owned by a convicted child rapist's paedophile gang to establish whether they had hidden more bodies of young girls after kidnapping them. Investigators are to use hi-tech British equipment from the "House of Horrors" probe, which helped British police find the bodies of 10 women and girls. Belgian police will also rely on the help of British Detective Superintendent John Bennett, who led the investigation into the murders in Gloucester, western England. "We just want to make sure there are no other secret places," Public Prosecutor Michel Bourlet told a news conference on Thursday. Chief suspect Marc Dutroux, 39, led police to the bodies of two eight-year-olds buried in the garden on one of his houses last weekend. Melissa Russo and Julie Lejeune, who starved to death due to negligence, were buried on Thursday. The outpouring of national grief since the girls' bodies were found surpassed the mourning after the death of much-loved King Baudouin three years ago. Two other girls were rescued from a home-built dungeon in Dutroux's house last Friday, but the remaining two -- Eefje Lambrecks and An Marchal -- are still missing. The police investigation centres on finding those two girls, who have been missing for exactly a year. In some of Dutroux's houses, underground cells and dungeons have been found, some still under construction, built to hold children prior to their transfer. Police said 10 or 11 properties owned by the gang would be searched first by dogs trained to find trapped living humans, and next by dogs trained to find human remains. Police would then verify the plans of all the houses with architects to ensure no hiding places have been built. Finally, the specialist equipment will be used to detect cavities in walls or basements, where bodies could have been hidden. On Thursday police searched the home of Dutroux, an unemployed father of three, in Sars-la-Buissiere south of Brussels, where the bodies of Russo and Lejeune were found. Dutroux is believed to have been the mastermind behind a kidnapping and juvenile pornography gang, which included his second wife. At least 15 children have vanished in Belgium in the past six years. Seven have now been found dead, six are still missing and only two have been rescued. Following the arrest of Dutroux, his second wife, an accomplice and a fourth suspect, Belgian and Dutch police have re-opened various cases of missing children. Belgian media said on Thursday the authorities were mulling the possibility of carrying out DNA genetic fingerprinting tests to compare Dutroux's tissue with tissue found on two young murder victims, including a German girl killed this summer. Under Belgian law, however, the suspect would have to give his consent. On Thursday police announced the arrest of a fifth suspect in the case -- Michael Diakostavrianos. He faced a charge of association with criminals. A local court will decide next Tuesday whether Diakostavrianos will be formally charged. 2463 !GCAT Following are the leading stories in the Maltese press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. THE TIMES - Sea Malta strike called off; strike had been ordered by General Workers Union on Wednesday to press for better working conditions. Two sides have agreed to hold fresh talks. - Importers plead for airfreight customs clearance in afternoons; customs officers work only mornings at airport and importers must pay them overtime to clear freight in afternoons. L-ORIZZONT - Sliema murder: murdered man was member of fundamentalist Islamic movement known for anti-Gaddafi views. IN-NAZZJON - Planning Authority considering fish farming projects. - Man fined for insulting ombudsman. 2464 !GCAT Following are some of the leading stories in the Swedish papers this morning. Reuters has not verified these stories and does not vouch for their accuracy. DAGENS NYHETER - Housing costs in Sweden are some of the highest in the world, a survey by Statistics Sweden showed. Swedes spend 32 percent of their income on housing compared to 23 percent in Germany. - The Swedish construction sector has been paralysed over the past five years, and the market is unlikely to improve in the near future. - Sweden's unemployment is higher than Denmark's for the first time in 25 years. Swedish jobless totalled 8.8 percent of the workforce in July, compared to 8.7 percent in Denmark. SVENSKA DAGBLADET - The Swedish trade union body LO is gearing up for battle as the government prepares to liberalise Sweden's labour laws in the autumn. DAGENS INDUSTRI - Swedish wage-earners have for decades watched their wage rises eroded by rising inflation. This year is different as Swedes in the private sector will see average wage rises of six percent while inflation consumer prices are only expected to rise by 1.5 percent. - Saab Aircraft is currently negotiating with several companies regarding the sale of its Saab 2000 commuter planes. Each plane has a price tag of $15 million. -- Paul de Bendern, Stockholm newsroom +46-8-700 1003 2465 !GCAT !GVIO After a tense standoff lasting almost two months, the final act of the immigrant hunger strike drama was played out in a little over 90 minutes in Paris on Friday . Hundreds of police used batons and fists to break through a crowd and storm the Saint-Bernard church in the capital's multi-ethnic Goutte d'Or neighbourhood at 7.45 a.m. (0545 GMT). By 9.20 (0720 GMT), the last of the 300 African would-be immigrants who had been occupying the church since June 28 had been led or dragged from the building and whisked away in ambulances and buses. Ten Africans who were on the 50th day of a hunger strike were taken to two military hospitals while other protesters were driven to a Paris detention centre. The protesting Africans, who had occupied the church in the hope of convincing the government that they should be granted residence papers, had been passing sleepless nights for a week in fear of a police raid. It was last weekend that government officials let it be known in a series of interviews and speeches that they had expulsions, rather than residence papers, on their minds. When it finally came, the police action was impressive. A huge phalanx of officers wearing riot helmets, their batons drawn, stormed the church yard and physically pushed their way through hundreds of sympathisers who had surrounded the building in the hope of protecting the protesters. They appeared to go out of their way to prod the crowd with their batons rather than crack heads. But when they met resistance, blows were forthcoming. In many instances, officers used their hands and even their fists to get people out of their path. After only a few minutes of hand-to-hand grappling with the throngs of supporters, they reached the church gate. One policeman used a heavy axe to smash the chain holding a gate shut, and then the church's heavy wooden main gate was torn down in turn. But the Africans, huddled inside the church, had stacked chairs and other furniture in front of the doors -- obstacles patiently removed one by one by the police. Among the first to be led from the church through the howling crowd were French film beauty Emmanuelle Beart and political activist and cancer specialist Leon Schwartzenberg. The two were among numerous personalities who had flocked to the church in recent days to show their support for the protesters. Then came the hunger strikers, carried out on stretchers to waiting ambulances. Later, the rest of the Africans were escorted out, some willingly, others resisting all the way. "They took me by the arms and dragged me into a bus. Then they brought out my daughter," said Madjiguene Cisse, who had acted as a spokeswoman for the Africans during the protest's final days. "There, we're leaving," she told Reuters by mobile phone as the buses began pulling away from the church. Another spokesman for the protesters, Aboubakar Diop, was carried out of the church by plainclothes officers as if he were a sack of potatoes. He was handcuffed before being pushed into a police van and driven away. 2466 !C21 !CCAT !G15 !G153 !GCAT !M14 !M141 !MCAT German trader Alfred Toepfer pegged the EU 1996 grain crop at 187-190 million tonnes, compared with a 187-188 million tonne estimate in July. Last year's grain crop was put at 175 million tonnes. Toepfer said in a newsletter on Friday high yield results now allowed for a higher harvest estimate but the current forecast was based on normal weather patterns. Based on positive harvest results in France and Spain, Toepfer expected a soft wheat crop of 84-85 million tonnes, up some 4.5 million tonnes from 1995 and compared with 83.3 million estimated for 1996 last month. The 1996 maize crop could reach 31-32 million tonnes compared with 28 million last year and versus 31 million expected for 1996 in July. The barley result was expected to rise by five to six million tonnes over 1995 to 49-50 million this year. In July, the barley estimate was 48.6 million tonnes. The remainder of the total, which Toepfer did not describe in detail, was oats, triticale, rye, sorghum and mixed grains. --Hamburg newsroom, +49-40-41903275 2467 !GCAT Following are some of the leading stories in Norwegian papers this morning: AFTENPOSTEN - Most voters want Prime Minister Gro Harlem Brundtland to remain in office and reject the idea of her designated successor Thorbjoern Jagland taking over in the near future, an opinion poll shows. - Brundtland's ruling Labour Party is losing ground in a monthly opinion poll, but the opposition Centre Party and Conservatives are gaining support more than a year before the next general election. - Family Minister Grete Berget has banned staff from speaking to journalists and says all questions from the press must be handled by her chief of information. Members of the opposition in parliament accuse Berget of limiting the public's right to obtain information. DAGENS NAERINGSLIV - Insurance company UNI Storebrand ASA, which reported stronger-than-expected first-half profits, plans to trim the cost ratio in non-life insurance to 20 percent from about 28 percent within three to four years. - Forestry company Norske Skogindustrier ASA is growing nicely. It booked a first-half pre-tax profit of 1.04 billion crowns but the outlook for the rest of the year is not as bright because of changing market conditions. 2468 !G15 !G158 !GCAT !GDIP !GVIO The European Union said on Friday it remained deeply concerned over the situation in Chechnya, particularly the plight of the civilian population. In a statement issued on behalf of the 15-nation bloc, the Irish government, which currently holds the EU's rotating Presidency, said it deplored the rising number of attacks on civilians in the past week and called on both sides to ensure that people could return to their homes and remain in safety. The EU welcomed reports that negotiations had been resumed and urged Russia and Chechen separatist rebels to desist from any further military action. "The European Union reiterates its firm belief that negotiations are the only means of reaching a lasting political settlement to the situation in Chechnya, based on the respect of all concerned for human rights and fundamental freedoms." A ceasefire is due to come into effect in Chechnya on Friday after Moscow peacemaker Alexander Lebed and rebel chief-of-staff Aslan Maskhadov struck a peace deal on Thursday. The two sides are expected to form joint patrols to protect the devastated regional capital Grozny against looters. Tens of thousands of people have died in Chechnya since Mosco sent troops to quell an independence bid by the region, which Moscow wants to remain part of the Russian Federation. 2469 !GCAT The following are leading domestic stories in Portuguese newspapers. DIARIO ECONOMICO - Banco Portugues de Investimento (BPI) will be the future owner of Banco de Fomento e Exterior (BFE). - The distribution of income in Portugal became more unequal in the first four years of the 1990s, according to a study by the Bank of Portugal. - BPI shares rose 5.2 percent to hit a high for 1996 of 2,115 escudos after Finance Minister Antonio Sousa Franco said BPI was the only approved candidate in the privatisation of BFE. PUBLICO - The opposition centre-right Social Democratic Party (PSD) in the northern district of Vila do Conde voted in favour of the opening of Siemens's semi-conductor factory in the area. DIARIO DE NOTICIAS - The president of Portuguese retailer Jeronimo Martins, Alexandre Soares dos Santos, told the paper that he was not interested in acquiring assets in retail chain Pao de Acucar. He denied that any talks were taking place between Jeronimo Martins and French company Auchan, which recently bought Pao de Acucar, with a view to Jeronimo Martins acquiring a stake in Pao de Acucar. --Lisbon bureau 3511-3538254 2470 !GCAT Here are the highlights of stories in the Danish press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. BERLINGSKE TIDENDE --- Economy minister Marianne Jelved thinks current Danish local authority budgets are too complicated and that making the system simpler could help them hold expenditure targets. --- Denmark's opposition Conservative Party's proposals for the 1997 state budget to be unveiled next week will comprise some 10 billion crowns in cuts, party leader Hans Engell says. POLITIKEN --- A Finnish building worker drowned on the site of the fixed road-rail, train-car link across the Sound between Danmark and Sweden, the first death since the project, due for completion by the turn of the century, got under way. JYLLANDS-POSTEN --- Danish shoe manufacturer Ecco plans to penetrate the sports shoes market by launching a new series of golf shoes in Scandinavia, Germany, Ireland, Portugal and Benelux and launching test sales in the U.S.A., Britain and Japan. --- Aalborg's Karup Airport in western Denmark will be able to handle foreign flights in April 1997 after the building of a new air terminal at the military base-cum-civilian airstrip. BORSEN --- A new welfare reform proposal from the Danish Confederation of Industry promises jobs for 200,000 unemployed, tax reductions and better training by reducing minimum wages by 20 crowns to 55 crowns per hour and raising the early retirement age from 60 to 63 years of age. 2471 !C31 !C312 !CCAT !G15 !G153 !G158 !GCAT !M14 !M141 !MCAT The European Union's cereals management committee approved the following national food aid shipments from Germany on Thursday, grain industry sources said on Friday. Tonnage Grain Destination Shipment 770 Maize Nicaragua Aug 6 616 Rice Nicaragua Aug 6 2,484 Rice Iraq Aug 6 5,000 Maize Cape Verde Aug 6 3,000 Sorghum Niger Sep 7 500 Rice Algeria Sep 7 1,112 Sorghum Sudan Sep 7 600 Rice Haiti Oct 8 1,775 Maize Angola Nov 11 1,211 Rice Peru Nov 9 1,440 Rice Sierra Leone Nov 9 272 Rice Yemen Nov 9 1,537 Sorghum Zaire Nov 9 720 Maize Burundi Nov 9 1,680 Flour Azerbaidjan Sep 2472 !GCAT !GCRIM Giovanni Brusca, considered one of the Sicilian Mafia's most brutal bosses before his arrest three months ago, has begun collaborating with the law, Italian investigators said on Friday. Giancarlo Caselli, chief prosecutor in the Mafia stronghold of Palermo, confirmed to state RAI radio that Brusca had asked to talk to magistrates and had been interrogated. "We will see what the evaluation will be, positive, negative or neutral," he said, adding that it was premature to say whether Brusca's evidence was genuine. Lawyer Luigi Li Gotti, whose clients include other well-known Mafia turncoats or "pentiti" such as Tommaso Buscetta, said he was now representing Brusca, who had already provided hundreds of pages of evidence. "He began to collaborate last July, signing the first reports with his declarations on the 26th of that month," the lawyer said, adding that Brusca had been questioned by magistrates in Sicily and the Tuscan city of Florence. Italian television reports said Brusca had named the bosses behind Mafia killings and implicated politicians. Brusca, publicly branded "The Beast" by another turncoat who accused him of strangling his 12-year-old son and disposing of the body in a vat of acid, has been charged with several high-profile crimes in Sicily and mainland Italy. Investigators say it was Brusca who pushed the button detonating a bomb under anti-Mafia magistrate Giovanni Falcone's motorcade on a motorway near Palermo in 1992. Falcone, his wife and three bodyguards died in the explosion. He is also accused of involvement in planning 1993 Mafia bombings against cultural monuments in Rome, Florence and Milan, one of which damaged the Uffizi art gallery in Florence. Caselli said the news of Brusca's collaboration had slipped out unintentionally and investigators would have liked to continue working in secret for longer. Italian newspapers, referring to fears of a deliberate Mafia plot to mislead judges with fake turncoats, said investigators were wary of being fed disinformation. "Brusca's revelations -- which could also link the Mafia and politics -- could throw light on an overwhelming list of crimes," the daily Corriere della Sera reported. Rumours that a top Mafioso had become a "pentito" had been circulating for some time as police made a series of high-profile arrests in Sicily. "He is the first and so far the only top leader of Cosa Nostra to have decided to collaborate," Li Gotti said. Pino Arlacchi, a leftist senator and an expert on the Mafia, told the Corriere della Sera that Brusca's decision marked the end for the Corleonesi clan and could lead to "boss of bosses" Salvatore Riina deciding to give evidence as well. "He is almost 70 years old, still rich and powerful but without any prospects. Or, at least, with only one prospect -- that of spending the rest of his years in a cell," Arlacchi said of Riina, who is already serving several life sentences. But Arlacchi also urged caution. "The Mafia is not yet beaten. For the moment, only the Corleonesi who have dominated Cosa Nostra for the past 20 years have been beaten," he said, warning that the Mafia was already reorganising on a local level. 2473 !GCAT Following are some of the top headlines in leading Italian newspapers. ---------- TOP POLITICAL STORIES *Giovanni Brusca, former mafia boss arrested in May, starts revealing to magistrates details of his long criminal career. Among other things, he is accused of being the man who pressed the remote control to detonate the bomb which killed anti-mafia judge Giovanni Falcone. (all) *Minister for Public Works and former anti-graft magistrate Antonio Di Pietro, who was quoted as saying he wanted to lead a new centrist movement, is now seen by many as a potential challenge to the Prodi government. Green party spokesman Carlo Ripa di Meana says: "We could vote against the government over Di Pietro" (Corriere della Sera). Centre-right opposition Freedom Alliance is said to welcome "leader" Di Pietro (Repubblica). *Secessionist Northern League party leader Umberto Bossi says Di Pietro wants to reconstruct the old Christian Democrat party along with Foreign Affairs Minister Lamberto Dini and former speaker of parliament and League member Irene Pivetti (all). ---------- TOP BUSINESS STORIES *Fiat chairman Cesare Romiti says "We need measures to revive consumer expenditure. This government deserves praise for the quality of its members, but now we are waiting for the facts." (Corriere, Stampa) *After 10 sample cities' CPI, the inflation rate for the month of August is now seen around 3.4 pct year-on-year. (Sole 24 Ore). * Enel chairman Chicco Testa says the state electricity group should be privatised "soon but sensibly". (Sole 24 Ore) *Romiti says Fiat is not interested in taking a stake in state telecoms holding Stet once it has been privatised. (Corriere, Sole) ---------- Reuters has not verified these stories and cannot vouch for their accuracy. --Milan bureau +39266129450 2474 !GCAT These are leading stories in this morning's Paris newspapers. LES ECHOS -- German and French central banks cut interest rates. -- Finance minister Jean Arthuis cuts 1997 GDP growth forecast to between 2.25 and 2.5 percent from 2.5 to 2.8 percent. -- Promodes about to offload ailing German subsidiary Promohypermarkt to Spar AG or to Metro, Rowe and Lidl consortium. -- French state-TV chairman Xavier Gouyou Beauchamps asks government to tack an extra 350 million francs onto his 1997 budget. LA TRIBUNE DESFOSSES -- Interest rates ease in a bid to boost the economy. -- Thursday's 0.2 percent intervention rate cut is not enough to stimulate French growth but any bigger cut would have been counterproductive. -- President Jacques Chirac and Prime minister Alain Juppe to discuss tax cuts for middle-income households this weekend. L'AGEFI -- Treasury appoints CCF to bring SNCF railways accounting principles into line with EU laws and directives. LE FIGARO -- The independent FO union head Marc Blondel says Communist-led CGT union may join September 21 nationwide demonstration. LE FIGARO-ECONOMIE -- Arthuis says all wage-earners will pay less income tax next year. -- Total first half sales up 20 percent. LIBERATION (Economic section) -- George Soros predicts popular uprising in France in an article in Foreign Affairs magazine. THE INTERNATIONAL HERALD TRIBUNE -- Bold Bundesbank interest rate reduction prompts four EU central banks to quickly follow suit. -- Paris Newsroom +33 1 4221 5381 2475 !GCAT The following are some of the leading stories in Finnish papers this morning. HELSINGIN SANOMAT - Markka fell clearly on Prime Minister Paavo Lipponen's comments about a decision on linking the markka to ERM. - Forestry group Enso and environmental organisations in dispute over cutting in old Carelian forests. - Drugs criminals are in many ways better off than other convicts, survey shows. Many had a job and an apartment before they were jailed. @ - Finland would support a pact to ban infantry mines, Ministry of Foreign Affairs said. - UN Human Rights observer in Bosnia Elisabeth Rehn said she will not run in European Parliament Elections, despite reconsidering earlier, and support of Swedish People's Party. - Interest on student loans clearly lower than a year ago -- banks expect demand to rise this autumn. - Helsinki health official warns against blue-green algae, increasing due to heat, on some beaches. - Finns' self-esteem has improved despite split values and high unemployment, a study shows. @ - Many primary schools surrender to heat and let students go swimming during the late hours of school -- this is the hottest August since 1939. - Headlice found in almost 150 school students in Western Finland. KAUPPALEHTI - Many sawmills have within a short period fallen into financial difficulty. Strong markka and high raw wood prices hit profitability, chief Ilkka Poyhonen from Finnish Forest Industry Federation says. @ - Age discrimination when applying for a job in Finland less common than was thought, survey shows. DEMARI - Finn Tommi Makinen favourite in the World Cup Jyvaskyla 1,000 Lakes Rally, to start today. TURUN SANOMAT - Major cities decide to ban roller bladers from buses. - Weak catch of crayfish in past few weeks -- disease suspected. @ AAMULEHTI - Swedish Crown Princess Victoria to practice official ceremonies in her first official visit, to Finland, next week. -- Paivi Mattila, Helsinki Newsroom +358 - 0 - 680 50 292 2476 !GCAT The following are the main stories from Friday morning's Austrian newspapers. DIE PRESSE - Defence Minister Werner Fasslabend is launching a new pro-NATO initiative and planning to open an office for strategic studies. The office is to be led by a Freedom Party politician. - The Austrian National Bank followed the Bundesbank's lead and cut the repo rate to 3.0 percent, effective September 2, establishing parity with Germany again. - A telecom consortium composed of regional electricity companies, Verbund and the national railways OeBB is looking for an international operator. Global One and Unisource are under consideration. DER STANDARD - Media giant Mediaprint may face payments of millions of schillings after the high court ruled its newspaper street sellers were not self-employed but company employees. The company now has to pay past and future employment tax and social insurance for the street sellers. - The state is looking into possible links between Austrian companies and a Libyan poison gas plant. - Energieversorgung Niederoesterreich (EVN) and Hungary's MOL said they were building a joint venture power plant in Hungary. - Austria's electronics industry is feeling the pinch due to competition from eastern Europe. KURIER - Finance Minister Viktor Klima said the budget would hold for 1996, with a deficit of about 89 billion schillings. Whether the budget for 1997 can hold depends on the economic cycle, he said. - OMV said it wanted to play an active role in the upcoming privatisation of regional electricity companies. Company head Richard Schenz said OMV was interested in a stake in the Upper Austrian OKA and Energieholding Steiermark. - Austria's textile industry is worried it may lose state contracts. Some 1,000 jobs are at risk. SALZBURGER NACHRICHTEN - Chancellor Franz Vranitzky will travel to Israel and meet with Prime Minister Benyamin Netanyahu on September 1. He is also due to meet Palestinian leader Yasser Arafat in Gaza. 2477 !GCAT Following are highlights of stories in the Irish press on Friday. Reuters has not verified these stories and does not vouch for their accuracy. IRISH INDEPENDENT - Ireland's biggest mortgage lender Irish Permanent ended weeks of stalemate when it announced it was increasing its mortgage lending rate by a quarter of a percentage point. - Two investors who claim to be owed nearly one million Irish pounds by fund manager Tony Taylor believe they may have lost their money. - A second Japanese trawler was under arrest on Thursday night as the Irish Navy and Air Corps continued a cat and mouse game with up to 40 vessels off the Irish coast. - The Irish Department of Enterprise and Employment has widened its probe into Taylor Asset Managers to include the investigation of investments of 10 more investors. - Irish exploration company Ivernia and its South African partner Minorco have received planning permission from the local county council for a major lead and zinc mine at Lisheen, County Tipperary. - Building materials firm CRH refused to comment on reports that it is about to pay 180 million pounds stering for U.S. stone and concrete business Tilcon Inc. IRISH TIMES - Mortgage lending rates are on the way up with banks and building societies poised to add around a quarter of a percentage point to their main variable rates of interest. - Members of a County Antrim Protestant family who were driven into exile by by loyalist paramilitaries two years ago returned yesterday to live in Northern Ireland in defiance of the threat hanging over them. - Talks will resume next Tuesday in an attempt to avoid a major strike in Irish retail chain Dunnes Stores. - Top dealers in the London office of U.S. bankers Merrill Lynch are transferring to Dublin. - The Irish plastics industry called on the government to support incineration to deal with plastics not suitable for recycling. 2478 !GCAT Following are some of the main stories in Dutch newspapers today. Reuters has not verified these stories and does not vouch for their accuracy. HET FINANCIEELE DAGBLAD - Cabinet agrees 1997 budget, sets aside 3.25 billion guilders for employer tax relief and maintaining purchasing power. (p1) - Dutch central bank DNB cuts special advances rate to all-time low of 2.5 percent from 2.7 percent, tracking big German rate cut. (p1) - Trading group Internatio-Mueller books 12 percent higher H1 net of 45 million guilders, despite pressure resulting from newly-imposed ceiling on medicine prices. (p1) - Bank and insurance group ING books 27.9 pct higher first half net at 151 billion guilders. (p1) - Insurer Aegon raises forecast after first half net rises 15.7 pct to 711.1 million guilders. (p1) - Food producer Nutricia exceeds analysts' forecasts with 51 pct profit growth to 107 million guilders in first half. (p3) - Car industry supplier Polynorm expects profit recovery after net falls 43 pct in first half. (p3) - Textile group Blydenstein-Willink posts first-half loss of 1.9 million guilders, as results pressured by restructuring. (p5) DE VOLKSKRANT - Long-term jobless numbers fall for first time since 1992. (p1) - ING puts other banks on the spot by preparing its cashomats for two rival electronic payments cards. (p1) - Andy McDonald, founder of record label Go! Discs, leaves Polygram after row. (p2) - Growth of temporary employment slows in Q2 according to Central Bureau of Statistics. (p3) DE TELEGRAAF - Far-reaching measures to make car use more expensive circulate at ministry of transport and public works. (p1) - Technical wholesaler Econosto books first half net of 5.9 million guilders, compared with 3.9 million guilders in year earlier half. (p25) - ABN Amro bank to restructure its computer systems and information management unit. (p27) TROUW - Broadcaster Tros leaves newspaper publisher De Telegraaf after 30 years for publisher Audax. (p7) - Foundation of housing market is sound according to Rabobank economists. (p7) ALGEMEEN DAGBLAD - Jeans maker G-star threatens fashion chain P&C with lawsuit over copying their jeans. (p11) - Unions furious about new unexpected restructuring at harbour group HES unit EBS. (p13) --Amsterdam newsdesk +31-20-504-5000 2479 !GCAT !GPOL !GVIO French police on Friday tried to remove 300 African immigrants, 10 of them on a hunger strike, from a Paris church they are occupying to press their demands for residence permits, witnesses said. Hundreds of police were struggling with hundreds of sympathisers of the protesters who were trying to stop them entering the Saint Bernard church. Helmeted riot police managed to enter the church after breaking down the main gate, witnesses said. Police used tear gas and batons to try to clear the crowd outside the church as activists resisted them, chanting "French people, immigrants, solidarity". Some media celebrities chained themselves to the Africans, who have occupied the church since June, in an effort to prevent police from removing them. Prime Minister Alain Juppe has said there will be no blanket granting of residence permits for the protesters, but the government will consider their cases individually. 2480 !GCAT !GCRIM Mafia boss Giovanni Brusca, one of the most wanted mobsters in Sicily before his arrest in May, has begun cooperating with anti-Mafia investigators, Italian television reported on Friday. It quoted judicial sources as saying that Brusca, charged with the murder in 1992 of anti-Mafia magistrate Giovanni Falcone among other mob crimes, had been given urgent special protection measures. 2481 !GCAT !GTOUR The first sight of the ice cap that covers most of this vast Arctic island takes the breath away. It is nature in the raw, powerful and brooding. Like a huge bulldozer it has pushed ancient mountains before it, piling rock into a heap at its edge, here just a few minutes helicopter flight from Greenland's international airport, 60 km (40 miles) above the Arctic Circle at Kangerlussuaq. In the crystal-clear air, the icy desert seems to go on for ever. No people live here and no roads cross the white wastes. To begin to understand Greenland it is neccessary to see and contemplate this wilderness, for it covers 80 percent of the country, divides communities and makes any project a complex and friendishly expensive undertaking. Covering 2.1 million square km (810,900 square miles) Greenland is the world's largest island, but in many ways it is more like an archipelago, with pockets of population ranging from communities of less than 100, up to 13,000 in the capital, Nuuk, strung around the edge of the ice. For much of the year the only link between them is by Greenland Air's heavily-subsidised plane or helicopter. There are no roads between towns and for much of the year, over much of the country, ships are icebound. It is a harsh and unforgiving place in which to carve out an existence, one in which winter temperatures average -20C (-4 Fahrenheit) and -70C (-94 Fahrenheit) has been recorded in the far north. The inuit (eskimo) people who make up most of Greenland's 55,000 inhabitants have had to struggle not only with the elements, but with the impact of modern society brought to them from Denmark, to which they belong, although geographically part of nearby North America. "It was not until the sixties that we experienced many of this century's developments which other nations had long taken for granted. Consumer goods, power tools, modern hunting weapons, navigational technology, communications," Lars Emil Johansen, Prime Minister of Greenland's home rule governement told journalists visiting Nuuk. Such sudden development, and the introduction of television, heightened the aspirations of many people -- and their frustrations when they found that those aspirations could not be realised as easily as TV commercials promised. "Our people entered a dark time when they became confused about their identity and lost self-esteem," academic and former Johansen aide Noka Moeller told Reuters, sitting at a waterfront cafe in Nuuk, while hump-backed whales spouted nearby. That dark time saw rocketing alcoholism, suicide and assault as a race of hunters and fishermen, many deprived of their livelihood by foreign environmental campaigns and shrinking fish stocks, struggled to come to terms with themselves. But since Greenland achieved home rule under the Danish crown in 1979, its indigenous people -- some 10 percent of the population is Danish -- have found a new will and fresh dignity, Moeller and his country's leaders say. "There has definitely been a change. Social problems are easing, although they are still serious, and there is a new sense of purpose," he said. Suicide -- committed by almost three times as many men as women -- is decreasing, although at 11 percent of all deaths it is still worrying. The chronic alcohol abuse for which Greenlanders have become stigmatised in Denmark is falling, with 23 percent of the population describing themselves as total abstainers. Greenland now trains its own administrators, social workers and journalists and of the many youngsters sent to Denmark for higher eduction, most return home afterward. The educated young are confident of their ability to shape their country's destiny and there is exasperation with Danish authorities, seen by many as patronising, if well-meaning. The movement for full independence has no real political weight but many people would like to take more control than they have now, with defence, foreign affairs and some trade issues still decided in Copenhagen. "Our position is not anti-Danish but pro-Greenlandic. In general our relations are good, although we have tough talks on defence and foreign affairs," Johansen said. "Ultimately we need a change in the constitution, but its too early to discuss that now." 2482 !GCAT !GPOL Palestinian journalists in the Gaza Strip self-rule enclave on Saturday boycotted covering the day's meeting of the Palestinian Authority cabinet for several hours after a security man assaulted three journalists. The Palestinian Journalists Syndicate in Gaza, which called the boycott, ended it after the man's commander arrested him. The member of the elite Force 17 unit had stopped a Reuters Television crew and a World Television News man about 100 metres (yards) from Palestinian President Yasser Arafat's office on Saturday morning and made them sit in the sun for 30 minutes. When one of the three complained, the security man cursed him. Another journalist joined the argument. The security man then hit two of the journalists. No one was injured and no equipment was damaged. The Journalists Syndicate called the boycott shortly after the incident, which it said was "an insult to the dignity of Palestinian journalists". Arafat adviser Nabil Abu Rdainah told Reuters in reaction: "I will investigate the matter and I will take the suitable steps to solve such problems." The Journalists Syndicate later issued a statement calling off the boycott which said: "It appreciates the decision of the leader of Force 17 Brigadier General Faisal Abu Sharikh to arrest the security man who attacked journalists." It said Abu Sharikh had also ordered a room be set aside at Arafat's office for journalists and appointed a special officer to "facilitate" their work. Human rights groups have cited intimidation of journalists as part of a series of abuses under the Palestinian Authority since it began taking control of parts of the West Bank and Gaza Strip in 1994 in an interim peace deal with Israel. Last week, the Palestinian cabinet decided to set up guidelines that would curtail the powers of security forces and probe those suspected of financial and moral corruption. The decisions were based on the recommendations of a ministerial committee that probed the death of an inmate by torture in a Nablus prison in the West Bank and a demonstrator during a riot in the West Bank town of Tulkarm. 2483 !GCAT !GENT American pop star Michael Jackson's September 27 concert has been cancelled after authorities refused to give permission for it, the private Moroccan television channel 2M said on Saturday. "Moroccan authorities did not give the green light for Michael Jackson's show but gave no explanation either," the Casablanca-based station said in its evening news bulletin. Jackson visited the city, Morocco's financial centre, on his return from South Africa last month and said he wanted to perform there because it reminded him of the Hollywood movie Casablanca. "Fears of gathering more than 100,000 young people could be one of the motives explaining the authorities' decison," a concert organiser who had earlier conferred with Moroccan officials told the television, hinting at possible street protests against the glitzy Western-style show. A live televised broadcast of Jackson's show to the United States had also been planned by the Moroccan organisers, the television added. The interior ministry has in the past banned other big concerts, including one by the popular Casablanca-based satirist Ahmed Sanoussi, without explanation. Casablanca, with four million inhabitants, has frequently seen demonstrations by students, workers and young Moslem fundamentalists. Officials were not immediately available for comment. 2484 !GCAT !GPOL Palestinian journalists in the Gaza Strip self-rule enclave said on Saturday they would boycott covering the day's meeting of the Palestinian Authority cabinet after a security man assaulted three journalists. A member of the elite Force 17 unit stopped a Reuters Television crew and a World Television News man about 100 metres (yards) from Palestinian President Yasser Arafat's office on Saturday morning and made them sit in the sun for 30 minutes. When one of the three complained, the security man cursed him. Another journalist joined the argument. The security man then hit two of the journalists. No one was injured and no equipment was damaged in the incident. The Palestinian Journalists Syndicate in Gaza said in a statement: "The syndicate is boycotting the meeting at Arafat's office because of this attack which reflects an insult to the dignity of Palestinian journalists. "The syndicate sent messages to the cabinet and Ministry of Information and to the commander of Force 17 and to Arafat's media adviser demanding they carry out the civil procedures to avoid repetition of such attacks on journalists." Arafat adviser Nabil Abu Rdainah told Reuters in reaction: "I will investigate the matter and I will take the suitable steps to solve such problems." Human rights groups have cited intimidation of journalists as part of a series of abuses under the Palestinian Authority since it began taking control of parts of the West Bank and Gaza Strip in 1994 in an interim peace deal with Israel. Last week, the Palestinian cabinet decided to set up guidelines that would curtail the powers of security forces and probe those suspected of financial and moral corruption. The decisions were based on the recommendations of a ministerial committee that probed the death of an inmate by torture in a Nablus prison in the West Bank and a demonstrator during a riot in the West Bank town of Tulkarm. 2485 !C11 !C12 !CCAT !GCAT !GCRIM A U.S. district judge issued a preliminary injunction on Friday delaying the reorganization plan of insurance giant Lloyd's of London, but the firm's chairman said an appeal had been filed. Lloyd's reorganization plan was linked to having investors fund a newly formed reinsurance company, Equitas, but some became sceptical, claiming Lloyd's would not provide them with sufficient information and thus breached U.S. securities laws. U.S. District Court Judge Robert Payne agreed and ordered Lloyd's to give the information to investors within a month. Payne ruled the 93 U.S. investors in the case would suffer irreparable harm if the preliminary injunction was denied. "The defendant's (Lloyd's) motion to dismiss is denied and the plaintiff's motion for preliminary injunction is granted," the judge said in his written ruling. Investors, whom Lloyd's calls Names -- individuals who pledge their assets to back the insurance policies sold at Lloyd's -- were being asked to pay up to $150,000 each to help fund Equitas, which would take responsibility for $12.4 billion in losses from asbestos, pollution, and disaster claims between 1988-1992. The ruling effectively blocks creation of Equitas and Lloyd's has until September 23 to see that American Names receive information on Equitas. There are 2,700 U.S. Names and nearly 34,000 worldwide. Following the decision, Lloyd's Chairman David Rowland said in a statement issued in London: "We regret the decision reached in the Virginia District Court. We have lodged an immediate appeal, which is likely to be heard early next week in order that we should be able to proceed with our reconstruction programme...." Lloyd's lawyer, Harvey Pitt, of a Washington law firm, called the order "surprising and disappointing." In Friday's order, Judge Payne also ruled that the injury the plaintiffs and other American investors would suffer significantly outweighed any harm to Lloyd's by complying with its obligations under the securities laws of the United States. Lloyd's Chief Executive Ronald Sandler had testified in hearings earlier in the week that Lloyd's solvency would be in doubt without the U.S. Names. The firm, which is more than 300 years old, wants investors to vote on acceptance or rejection of the recovery plan by next Wednesday. "Our outside date on (reconstruction and recovery) acceptance is 28th as planned, and our hope is that the Court of Appeals will be able to either stay the district court's order or resolve this matter so that the process gets completed in an orderly fashion," Pitt said. An appeal would take place at a date and time set by the U.S. 4th Circuit Court of Appeals, also in Richmond, Va. Until then Judge Payne ordered Lloyd's to send a copy of his 141-page order to every American Name. The judge ruled investments in Lloyd's were "securities" in part because Lloyd's has more than 500 Names and total assets of more than $10 million. "Lloyd's is in violation of the securities exchange act and that in seeking Names' consent to the settlement offer dated July 26, 1996, Lloyd's is using the U.S. mail and other means or instrumentalities of interstate commerce to solicit a proxy or consent or authorisation from the plaintiff and the other American Names in contravention of rules and regulations promulgated by the Securities and Exchange Commission," Judge Payne ruled. 2486 !C11 !C12 !C17 !CCAT !GCAT !GCRIM A U.S. federal judge on Friday granted a preliminary injunction that stopped the reorganization plan of the insurance market by Lloyd's of London from going forward. U.S. district court judge Robert Payne ruled that the plaintiffs, 93 U.S. investors, would suffer irreparable harm if the preliminary injunction was denied. The judge also said the injury the 93 plaintiffs in the case and other American investors would suffer significantly outweighed any harm to Lloyd's of complying with its obligations under the securities laws of the United States. Investors, whom Lloyd's calls Names-- individuals who pledge their assets to back the insurance policies sold at Lloyd's-- had sought to block the reorganization plan, whereby Lloyd's would reinsure billions of dollars in liabilities by creating a new reinsurance company, Equitas. Under the plan, the investors were being asked to pay up to $150,000 each to help fund Equitas. The investors filed suit, claiming Lloyd's declined to provide detailed financial information about Equitas as required under U.S. securities laws. 2487 !GCAT !GSPO Top-seeded Arantxa Sanchez nearly missed her wake up call but recovered in time to gain the final of the $450,000 Toshiba Classic on Saturday. The feisty Spaniard spotted doubles partner and No. 3 seed Jana Novotna a one-set lead before bouncing the Czech star 1-6 6-2 6-3. Sanchez Vicario will meet No. 4 Kimiko Date, who surprised defending champion Conchita Martinez of Spain 6-2 7-5, in Sunday morning's title match worth $80,000 to the winner of the final hardcoourt tuneup event before next week's U.S. Open in New York. "Seems like I was still sleeping and then the alarm said, 'OK, hold on a second, wake up.' That's when I woke up," she laughed. "I definitely don't like to play at nine or 10 o'clock. But I fight til the end, and I am lucky to be in the final." Sanchez Vicario sleep-walked through the first-set drubbing before awakening with her pesky ground game to get past the world's No. 6 ranked player for the fourth time this year without a loss. While Sanchez Vicario was snapping out of her funk, Novotna was falling further into fatigue after playing her second match in 12 hours due to televison scheduling and a grueling late night three-set victory over France's Sandrine Testud. Novotna was irritated but refused to blame the poor scheduling as an excuse. "Definitely not a great schedule to play a first match at 10 am," she said. "No matter how fit you are the body needs to recover. If you have less than 12 hours to recover before the next match, it's not enough. That's what basically happened to me. I started really well, got tired and could never get out of it. "I understand television has its needs and they want to have certain players on live," she said. "It happens and as a top player you have to able to deal with everything. That's what I am and I have no complaints about it." "Arantxa is a great athlete. She can run down so many balls and that makes it really difficult. Against other players a point would be over. But she still can get to the point and give you the high ball back. You have to start all over again. So it's mentally difficult to play her becaue she can last a long time and she's such a good runner." The deciding third set was leveled until Sanchez Vicario slammed an overhead winner for a the break and a 4-3 lead. At 5-3 she broke again to claim the hard-fought victory. "I won because I have guts and confidence in myself," said Sanchez Vicario, "It was a very close match. "Definitely I had to fight and be able to come with good shots to win." Date's upset of the third ranked Martinez dashed the hopes of an all-Spanish final. "She was definitley the better player today," said Martinez, the l994 Wimbledon champion. "I was on the defensive all the time. I wanted to attack, I tried to be very aggressive, but I missed a lot of forehands and that's my strength." Date sailed through the first set taking the last three games against the error-prone Spaniard during the 77-minute sweep. Martinez offered a tougher challenge in the next set, taking a 5-4 lead. Date held and broke for 6-5 before holding at love for the victory. "When Conchita came back to 4-4, I was a little uptight," said Date, ranked No. 9 in the world. But I felt I was in good form and could keep myself from going to pieces." "I had my chances in the second set, but I played badly at 5-4," said Martinez, who fell to 2-6 lifetime against Date. "When I lost my serve, that was it." 2488 !GCAT !GSPO Andrei Medvedev of Ukraine, seeded fifth, and unseeded Martin Damm of Czech Republic won semifinal matches on Saturday in the Hamlet Cup tennis tournament. Medvedev beat unseeded Karol Kucera, Slovakia, 7-6 (7-0) 6-3. Damm, seeking his first ATP Tournament victory, eliminated unseeded Adrian Voinea of Romania who played most of the match with a taped sprained ankle 5-7 7-5 7-5. The ankle injury makes his availability for his U.S. Open first rounder against defender Pete Sampras in doubt. "I don't know how I'll feel," he said while having trainers work on his ankle after the match. "Maybe I'll ask for a Tuesday start." Medvedev, swept the tiebreaker, getting three of the points on three of Kucera's 10 doublefaults. Kucera, who had upset top- seed Michael Chang, U.S. Friday night, led 3-1 in the second set but Medvedev won the last five games. Voinea turned his ankle in the third game of the second set. Ahead 2-0, he turned quickly with his foot planted on the hard court. Half-carried from the court, he surprisingly was able to come back to play but did not show the consistency that enabled him to win six straight games from 3-5 in the first set. "I was surprised he came back," Damm said. "It looked bad. But he hit a winner the first point so I knew it wasn't that bad." Damm, who said he tried to keep Voinea running, drew even on service in the sixth game and broke service at 15 in the l2th game for the set. Voinea extended Damm through five match points, two in the 10th game of the third set and three more in the final game. He erased the first four with winners but missed the baseline on the fifth. 2489 !GCAT !GSPO Results from the Waldbaum Hamlet Cup tennis tournament on Saturday (prefix number denotes seeding): Semifinals: Martin Damm (Czech Republic) beat Adrian Voinea (Romania) 5-7 7-5 7-5 5-Andrei Medvedev (Ukraine) beat Karol Kucera (Slovakia) 7-6 (7-0) 6-3 2490 !GCAT !GSPO About 350 athletes from nine countries set out on a 323-mile (517 km) climbing, rafting, biking and running endurance race thorugh the Canadian wilderness on Saturday. The event, called the Eco-Challenge, is part of a growing sport known as adventure racing in which competitors test their limits for days over a perilous wilderness course. The Eco-Challenge has been staged twice before -- in Utah and Maine last year -- and is modelled on similar races overseas. The 70 teams in this year's race will will trek glaciers, climb mountains, whitewater raft, horseback ride, canoe and mountain bike on the gruelling course. The location of this year's race was keep a secret until Friday evening. It is being held near Pemberton, British Columbia, about 100 miles (165 km) northeast of Vancouver. The area is filled with treacherous mountain peaks, ice fields and frigid waters. Organisers expect about two-thirds of the participants to drop out or be disqualified before the finish. The hardy ones are expected to complete the course in about six days with first-place finishers receiving $10,000 in prize money. In the Eco-Challenge, competitors race in teams of five which must include both men and women. Team members must remain within 100 yards of each another at all times and finish together. With racers carrying about 40 pounds (18 kg) of gear on their backs, broken bones, sunstroke, dehydration and exhaustion are common. "I'm looking forward to this race. I think it will be more physically challenging and we'll have to go up against more diverse situations due to the terrain," said Dr. Michael Stroud, a veteran Eco-Challenge participant. 2491 !GCAT !GSPO A small homemade bomb exploded near the first tee at Firestone Country Club on Saturday during the NEC World Series of Golf, slightly injuring three people, who were treated at the scene. The explosion, in a beer can left in a cardboard waste receptacle, occurred at 3 p.m. EDT (1900 GMT), 35 minutes after the last pairing of the day had teed off and the thousands of spectators had moved on. Witnesses reported seeing two young men toss cans into the receptacle just before the blast. Terry Livers, Akron's deputy chief of police and a tournament volunteer, said: "A homemade fireworks device was placed and detonated in a waste receptacle on the slope by the first tee. The beer can was shredded by the explosion, and by the powder residue we know it was a fuse device, not a pipe bomb. Several beer cans and water bottles inside the receptacle helped absorb the explosion. It was like an M-80 or M-100 (firecacker) or slightly larger. "We have a description of two males and are looking for them now. It is possible that we have photographs or video that will help the search." There were already over 100 members of security forces, both uniformed and plainclothes, at the club, and security was increased for the remainder of the third round and for Sunday's final round. It was believed to be the first such incident at a golf tournament. The Akron competition is a $2.1 elite event restricted to 43 tournament winners from around the world. 2492 !GCAT !GSPO Results from the $450,000 Toshiba Classic tennis tournament on Saturday (prefix number denotes seeding): Semifinals: 1-Arantxa Sanchez Vicario (Spain) beat 3 - Jana Novotna (Czech Republic) 1-6, 6-2 6-3 4-Kimiko Date (Japan) beat 2-Conchita Martinez (Spain) 6-2 7-5. 2493 !GCAT !GSPO Finland's Juha Kankkunen produced an impressive performance in his Toyota on Saturday to open up a 37 seconds lead after six stages of the 1,000 Lakes Rally, sixth round of the world championship. On a weekend overshadowed by Friday's fatal accident, four times world champion Kankunnen emerged from the first five of Saturday's 10 stages with a commanding advantage over his country's latest prospect, Marcus Gronholm, also in a Toyota. World championship leader Tommi Makinen in his Mitsubishi was third but current world champion Colin McRae ended a bad week by crashing out. After being fined $250,000 by the sports governing body on Tuesday, the British driver rolled his Subaru 6.5 km into stage six. He and co-driver Derek Ringer were unhurt but team boss David Richards was furious with them. "It's not unfortunate, it's incompetent," he declared. Kankkunen has set an astonishing pace for a driver who has not rallied for three months. "If you do a lot of something, sometimes it's good to have a break. It's not bad for an old man!" said the 37-year-old veteran. Ford had a poor morning with Spaniard Carlos Sainz losing 90 seconds through turbo trouble while Belgian Bruno Thiry dropped four minutes when a transmission shaft snapped. 2494 !GCAT !GSPO Jacques Villeneuve provided compelling evidence on Saturday that he will not allow his Williams team mate Damon Hill an easy run-in to the world drivers' championship when he claimed pole position for the Belgian Grand Prix. It was Villeneuve's second pole position in his first season in Formula One and came after many experts had predicted he would struggle to learn the long Spa-Francorchamps track quickly enough to be competitive. The Canadian clocked a best time of one minute 50.574 seconds in his Renault-powered car just over halfway through the hour-long session and immediately before heavy rain fell. The wet weather made the track slower and more treacherous and left Hill, who leads the title race by 17 points with four races remaining, frustrated for the final 20 minutes. Double world champion Michael Schumacher of Germany, who is too far behind to play a part in this year's championship contest, returned to action in his Ferrari after his crash on Friday morning and clocked the third fastest time behind Hill. David Coulthard in a McLaren was fourth fastest, Austrian Gerhard Berger in a Benetton fifth and Mika Hakkinen of Finland in the second McLaren sixth. Sunday's 44-lap race over the 6.974 km track cannot decide the outcome of the championship, but could be highly-influential, particularly if Hill wins and extends his advantage. But on Saturday's evidence the outcome may be decided, as often in the past, by the manner in which the drivers cope with the capricious weather in the Ardennes. Villeneuve had dominated from the start of the session, wrenching the psychological ascendancy away from Hill, whose name has been linked with a possible move to McLaren next season by the paddock rumour machine. Three times the Canadian was fastest while Hill only headed qualifying twice during the dry 35-minute spell. Schumacher was never able to break up the all-Williams domination of the front row, the Anglo-French team's sixth this year, and contented himself with a solid performance to finish ahead of Coulthard. Villeneuve, clearly relishing the old-fashioned nature of the circuit and its atmosphere, said after the session that he was looking forward to the race. "This is one of the last true tracks remaining. It is a place where you can really enjoy yourself and I was pushing to the limit. To get pole here is highly pleasing." He revealed also that he learned the circuit quickly with the help of a video game which he had played in advance to prepare him for the length of the track and its fast corners. "I know it sounds childish, but that is what I did: I learned it with a new video game and it is pretty much like the real thing." Asked where he had qualified in the video game, he said he had been "around 18th or something -- not on pole." Hill said there was always a certain amount of pain in being beaten, but pointed out that it had been frustrating for him as he could not go out and use his final set of qualifying tyres because of the wet weather. He also expressed some reservations about his position for the start -- uphill on the outside of the grid -- following three poor front row getaways at recent races. But he said he felt he had found the perfect set-up for his car without being able to explore it fully. "Pole is important here, but not as important as at some other places," he admitted, adding that even if he made a good start, he might find it difficult to make the best use of it on the slippery outside line into the hairpin at the first corner. 2495 !GCAT !GSPO Grid positions for Sunday's Belgian Grand Prix motor race after final qualifying on Saturday: 1. Jacques Villeneuve (Canada) Williams 1 minute 50.574 seconds (average speed 226.859 kph) 2. Damon Hill (Britain) Williams 1:50.980 3. Michael Schumacher (Germany) Ferrari 1:51.778 4. David Coulthard (Britain) McLaren 1:51.884 5. Gerhard Berger (Austria) Benetton 1:51.960 6. Mika Hakkinen (Finland) McLaren 1:52.318 7. Jean Alesi (France) Benetton 1:52.354 8. Martin Brundle (Britain) Jordan 1:52.977 9. Eddie Irvine (Britain) Ferrari 1:53.043 10. Rubens Barrichello (Brazil) Jordan 1:53.152 Add grid: 11. Heinz-Harald Frentzen (Germany) Sauber 1:53.199 12. Johnny Herbert (Britain) Sauber 1:53.993 13. Mika Salo (Finland) Tyrrell 1:54.095 14. Olivier Panis (France) Ligier 1:54.220 15. Pedro Diniz (Brazil) Ligier 1:54.700 16. Jos Verstappen (Netherlands) Arrows 1:55.150 17. Ukyo Katayama (Japan) Tyrrell 1:55.371 18. Ricardo Rosset (Brazil) Arrows 1:56.286 19. Pedro Lamy (Portugal) Minardi 1:56.830 Did not qualify (times did not meet qualifying standard): 20. Giovanni Lavaggi (Italy) Minardi 1:58.579 2496 !GCAT !GSPO A Belgian man died and 31 people were injured after an accident in Friday's opening phase of the world championship 1,000 Lakes Rally. The unnamed victim died during the night, a hospital spokesman said on Saturday. Danish driver Karsten Richardt had ploughed into the crowd during the two-kilometre first stage held in the host city of Jyvaskyla. Richardt's Mitsubishi skidded down an escape road and ploughed into a cordoned-off area for spectators. A second Belgian was also seriously injured but the hospital spokesman said his life was not in danger. The stage was suspended but the four-day rally resumed on Saturday. A woman was killed before last year's event when she walked in front of a car practising on the course. 2497 !GCAT !GSPO Tiger Woods advanced to the semifinals of the U.S. Amateur Golf Championship in Cornelius, Oregon, when he bettered D.A. Points, 3 and 2, in a quarterfinal match at the Pumpkin Ridge Golf Club on Friday. Woods, in search of an unprecedented third straight U.S. Amateur title, set up a meeting with Stanford University teammate Joel Kribelm, who had to go to an extra hole before getting by Duke Delcher. The other semifinal pits Robert Floyd, the son of Senior PGA Tour mainstay Raymond Floyd, and Steve Scott. Floyd closed out Bryan Novoa by getting 2 up. Scott was 1 down on the 16th hole, but rallied to beat 1995 finalist Buddy Marucci, 1 up. The semifinals are Saturday, with the winners meeting in the 36-hole final Sunday. The 20-year-old Woods is trying to become the first player to win three straight U.S. Amateur Championships. Before winning in 1994 and 1995, he captured three straight U.S. Junior Amateur crowns. The winner of the U.S. Amateur receives an automatic entry into next year's Masters and U.S. Open, if he is still an amateur. Woods became the youngest U.S. Amateur champion in 1994 and edged Marruci last year in Newport, Rhode Island, to become the first back-to-back winner since Sigel captured consecutive titles in 1982-83. Woods also became only the third golfer in history to win a USGA championship in five straight years. 2498 !GCAT !GSPO Top-seed Arantxa Sanchez Vicario of Spain and doubles partner Jana Novotna will clash in the semifinals at the $450,000 Toshiba Classic. Sanchez Vicario combined an effective serve, firing in seven aces, with her signature baseline game to ease past unseeded Katarina Studenikova of Slovakia 6-3 6-3 on Friday. Third-seed Novotna of the Czech Republic rallied past Sandrine Testud of France 2-6 7-6 (7-4) 6-3 in a two-hour, 35-minute match. Earlier, fourth-seed Kimiko Date of Japan dismissed a lethargic Argentine Gabriela Sabatini, seeded fifth, 6-4 6-1 on the hard courts, setting up the other semifinal with defending champion Conchita Martinez of Spain. "It was a good match for me and a good win," said Sanchez Vicario of the 73-minute victory. "Everything worked really well for me today. I was very happy with the way I played. I'm looking good and it's nice to be able to be in the semifinals." The scrappy Spaniard needed a decisive service break in the final game to claim the opening set. A lone break in the eighth game of the second moved this year's French Open, Wimbledon and Olympic runnerup into her 10th semi of the year. The second-ranked Spaniard now must focus on playing Novotna, with whom she has teamed to win 15 doubles titles. The Czech star publicly lashed out at Sanchez Vicario, saying she questioned too many line calls during a semifinal loss in the recent Summer Olympic Games. "I'm not agreeing with anything she said," the Olympic silver medalist explained. "It hurt me a lot because there are things you can say and things you cannot say. "But it doesn't matter because I play her three times this year and I beat her. It happens sometimes you have to play your doubles partner. I have nothing against her but I don't think it was fair because it's not true." Though the two have talked and are committed to play at the upcoming U.S. Open and the Corel WTA Championship in November, Sanchez Vicario is still not happy with the way Novotna handled herself in front of the media. "If she had something to say, she should have come to me. I don't think it was very smart." Novota didn't play smart in the opening set but managed to prevail against the world's No. 40 ranked player. "I didn't expect Sandrine Testud to play so well," said Novotna, who improved to 4-0 against the French player. "I told her after the match she deserves all the credit because she played unbelievable. She ran down so many of my balls, and I happened to be a little more aggressive and a little luckier at the end to win the whole match. But I thought it was a really unbelievable match." Testud sailed through the opening set with pinpoint passing shots against Novotna's aggressive net-rushing style. The second set went into a tiebreaker and the French player led 4-2 before committing five straight errors. Novotna led 4-3 in the decisive third set and used a lone service break in the next game when at break point she laced a backhand pass before closing out the come-from-behind victory. "I thought towards the end it was my serve and forehand, especially when I was down in the tiebreaker," Novotna said. "She wasn't really aggressive enough. She was hoping I would make all the mistakes. But I happened to play some very good shots and that was the turnover." Date played a smart baseline match against the lethargic Argentine, who committed seven costly double faults, including four at break point. "I've played her several times in the past, but I think if I had to compare her where she was in the Top 10, she's making more unforced errors and looks like she wasn't able to put much pressure on me by her serve," said Date, who improved her career mark to 3-4 against Sabatini. "I would say, she was not in good form today." 2499 !GCAT !GSPO Results from the $450,000 Toshiba Classic tennis tournament on Friday (prefix number denotes seeding): Quarterfinals: 1-Arantxa Sanchez Vicario (Spain) beat Katarina Studenikova (Slovakia) 6-3 6-3 3-Jana Novotna (Czech Republic) beat Sandrine Testud (France) 2-6 7-6 (7-4) 6-3. 4-Kimiko Date (Japan) beat 5-Gabriela Sabatini (Argentina) 6-4 6-1 2500 !GCAT !GSPO Unseeded Karol Kucera of Slovakia, ranked 86th in the world, upset top-seed Michael Chang of the United States 6-4 6-4 to reach the semifinals of the Hamlet Cup tournament on Friday. The 22-year-old Kucera, scoring the biggest victory of his seven-year career on the ATP tour, produced an aggressive service and consistent ground strokes while Chang was uncharacteristically erratic. "I'm happy. I'm yelling inside me," Kucera said after holding off Chang's rally from 0-4 in the second set. "It"s just one of those days but I hate to have it like this just before the U.S. Open," said Chang, who will be seeded second at the Open. "I hope it won't effect me going into the Open, but I have a couple of days to recoup," he said. Kucera broke Chang in a l6-point fifth game of the match and held on for the set. He then took advantage of numerous Chang errors to reach 4-0 in the second set before Chang started to rally. Ahead 5-2, 30-0 Kucera doublefaulted twice to lose service. Ahead 5-3 with three match points, he was unable to hold off Chang who pulled within 4-5 with service winners. Kucera won the last game as Chang committed four errors. "I lost in three sets to Michael in Rome on clay last year," Kucera said. "But we were 3-3 in the third set and I knew I could beat him." Fifth-seeded Andrei Medvedev of Ukraine, unseeded Martin Damm of the Czech Republic, and unseeded Romanian Adrian Voinea gained the semifinals in the afternoon. Medvedev beat American Jonathan Stark 7-6 (7-4) 4-6 6-3. Damm rallied to beat Michael Joyce of the United States 5-7 6-2 6-3 after winning the last three points to stave off a break-point situation in the last game. Voinea eliminated Sweden's Thomas Johansson 7-6 (7-4) 6-2, gaining a 4-1 lead in the tiebreaker and breaking service in the fourth and 10th games of the second set. 2501 !GCAT !GSPO Results from the Waldbaum Hamlet Cup tennis tournament on Friday (prefix number denotes seeding): Quarterfinals: Adrian Voinea (Romania) beat Thomas Johansson (Sweden) 7-6 (7-4) 6-2 5-Andrei Medvedev (Ukraine) beat Jonathan Stark (U.S.) 7-6 (7-4) 4-6 6-3 Martin Damm (Czech Republic) beat Michael Joyce (U.S.) 5-7 6-2 6-3 Karol Kucera (Slovakia) beat 1-Michael Chang (U.S.) 6-4 6-4 2502 !GCAT !GSPO Thunderstorms forced the suspension of the World Series of Golf after just five players in the 43-man field had completed the second round on Friday. Play initially was interrupted for more than 3-1/2 hours before resuming for two hours. But play was finally suspended for the day when the storm continued. The 38 players are schedeled to resume their rounds on Saturday morning before the third round begins. 2503 !GCAT !GSPO Scores from the $2.1 million NEC World Series of Golf after the second round was suspended due to rain on Friday with 38 of the 43 players yet to finish their rounds on the 7,149 yard, par 70 Firestone C.C course (players U.S. unless noted): -5 Paul Goydos through 2 holes -5 Billy Mayfair through 2 -4 Greg Norman (Australia) through 8 -4 Hidemichi Tanaka (Japan) through 3 -3 Steve Stricker through 3 -2 Phil Mickelson through 7 -2 Mark Brooks through 3 -1 Hal Sutton through 11 -1 John Cook through 5 -1 Tim Herron through 4 -1 Justin Leonard through 3 0 Steve Jones through 7 0 Nick Faldo (Britain) through 5 0 Davis Love through 5 +1 Fred Couples through 15 +1 Fred Funk through 9 +1 Scott Hoch through 9 +1 Ernie Els (South Africa) through 8 +2 D.A. Weibring through 12 +2 Clarence Rose through 9 +2 Duffy Waldorf through 4 +3 Jim Furyk through 16 +3 Corey Pavin through 14 +3 Craig Stadler through 14 +3 Brad Bryant through 12 +3 Tom Lehman through 11 +3 Sven Struver (Germany) through 10 +3 Alexander Cejka (Germany) through 10 +3 Anders Forsbrand (Sweden) through 5 +4 Willie Wood through 17 +4 Costantino Rocca (Italy) through 15 +4 Stewart Ginn (Australia) through 13 +5 Wayne Westner (South Africa) 77 68 +5 Sigeki Maruyama (Japan) through 17 +5 Mark O'Meara through 15 +5 Loren Roberts through 9 +6 Scott McCarron 76 70 +7 Satoshi Higashi (Japan) through 16 +7 Paul Stankowski through 15 +8 Craig Parry (Australia) through 13 +9 Tom Watson 79 70 +11 Seiki Okuda (Japan) 81 70 (through 18) +11 Steve Schneiter 77 74 )through 18) 2504 !GCAT !GSPO Kevin Keegan, who has spent a fortune building a team capable of bringing a much-yearned-for English premier league title to Newcastle, was left despairing on Saturday as his multi-million pound side lost again. "That's probably the worst performance in my reign as manager," he said after watching Newcastle crash 2-1 at home to Sheffield Wednesday. "We haven't started yet. Our performances so far this season have been poor and we will have to start soon if we want to win anything." Expectations were sky-high at St James' Park at the start of the season after England striker Alan Shearer joined the Tynesiders from Blackburn for a world record 15 million pounds sterling ($23.3 million). Newcastle were installed as the bookmakers' favourites to win their first championship since 1927, and the club's merchandise shop was selling black and white striped team shirts with Shearer's name emblazoned on the back by the truckload. Inside a month, the optimism of early August has vanished. First, Newcastle were routed 4-0 by Manchester United in the Charity Shield, then they lost their opening league game at Everton. Shearer silenced his doubters with a superb goal from a free kick in midweek as Keegan's side beat Wimbledon but on Saturday they were again a shadow of the team that so nearly won the league last year. "The fans have every right to be unhappy," Keegan said. "At the moment everyone has got the right to say we look a poor side. The only way we can stop goals at the moment is to board them up. "You can't legislate for the two goals we've conceded. They were down to sloppy defending. In the end we were committing suicide out there and we could have got beaten by more." To anyone who saw Newcastle last season, Keegan's complaints will sound familiar. Exhilarating in attack, they threw away valuable points in last year's epic league tussle with Manchester United through poor defending and inexplicable lapses in concentration. Keegan's decision to spend his 15 million pounds on attack rather than defence appears, for the moment, like an attack of midsummer insanity. Sheffield Wednesday's win leaves them with maximum points from their opening three league games. "It gives us a solid base to work from," manager David Pleat said. "The important thing from our point of view is that Newcastle didn't cut us up. They had a lot of the play but we withstood the pressure." The loudest laughs at Newcastle's expense will be heard at the Old Trafford headquarters of defending champions Manchester United. United unsuccessfully bid for Shearer before the season and were not best pleased when he opted to return to the city of his birth to further his career. But since then they have re-instated themselves as the bookmakers' favourites to lift their fourth championship title in five years with a series of impressive performances. On a day when all Newcastle's riches failed to bring them points, it was fitting that Italian Gianluca Vialli should score his first premier league goal. A player with all the class of Shearer, even if he is now a couple of years past his prime, Vialli came to Chelsea from Juventus without a lira changing hands. His goal in Chelsea's 2-0 triumph over Coventry was proof, if Keegan should need it, that hard cash alone cannot buy success. 2505 !GCAT !GSPO Results of European Super League rugby league matches on Saturday: Paris 14 Bradford 27 Wigan 78 Workington 4 Standings (tabulated under played, won, drawn, lost, points for, against, total points): Wigan 22 19 1 2 902 326 39 St Helens 21 19 0 2 884 441 38 Bradford 22 17 0 5 767 409 34 Warrington 21 12 0 9 555 499 24 London 21 11 1 9 555 462 23 Sheffield 21 10 0 11 574 696 20 Halifax 21 9 1 11 603 552 19 Castleford 21 9 0 12 548 543 18 Oldham 21 8 1 12 439 656 17 Leeds 21 6 0 15 531 681 12 Paris 22 3 1 18 398 795 7 Workington 22 2 1 19 325 1021 5 2506 !GCAT !GSPO Rain left England up the creek without a paddle on Saturday when less than three hours were possible between the showers on the third day of the final test against Pakistan at the Oval. Pakistan had reached 339 for four when the weather intervened for the final time, giving them a lead of 13 runs with two days remaining to safeguard their 1-0 lead in the three-test series. The heavy showers submerged any faint chance England had of fighting their way back into an improbable winning position, but at least saved the home bowlers from possible further embarrassment. When Pakistan resumed after lunch on 318 for two, with Saaed Anwar unbeaten on 169, the omens looked distinctly unpromising for an England attack operating on a flat strip. But rain during the lunch interval appeared to freshen up the pitch and they were able to remove both Anwar and the dangerous Inzamam-ul-Haq in the briefest of afternoon sessions. Anwar advanced to a test-best 176 before a loss of concentration cost him the chance to become the sixth Pakistani to score a double hundred against England. His classy innings, which spanned 379 minutes and included 26 fours, ended when he mistimed a pull off Dominic Cork and skied a catch to Robert Croft at mid-on. Inzamam had perished to a short delivery from Alan Mullally at the other end moments earlier, hooking straight to Nasser Hussain at deep square-leg, having made 35 in 80 balls. The double success at least dragged England back from the abyss which threatened to swallow them on Friday evening when their bowlers were dispatched to all parts of the Oval. Mullally and Croft kept things much tighter in the first hour of the morning, conceding just 25 runs and removing the prolific Ijaz Ahmed for 61 when he edged to a catch to Alec Stewart behind the stumps. Captain Mike Atherton experimented unsuccessfully with Ian Salisbury, whose three overs in the day cost 20 runs, and the first five overs with the second new ball from Cork and Chris Lewis cost 28. The seamers finally located some swing after lunch, but Cork blotted his copybook with an unnecessary shove on Anwar when the batsman was looking the other way at the bowler's end. Match referee Peter van der Merwe decided to take no action after Cork apologised. When the players belatedly attempted to start again after tea, a mere 10 balls were possible before the rain returned again. In total, just 38.3 overs were bowled in the day. "We bowled with much better discipline this morning, especially Alan Mullally," said England coach David Lloyd. "It was a much better effort all round, but you can't defeat the weather. It's frustrating for everyone." 2507 !GCAT !GSPO Essex are set to step up their English county championship challenge with a fifth consecutive victory after new-ball pair Neil Williams and Mark Ilott sent Gloucestershire reeling on Saturday. Williams seized two wickets in two deliveries and left-armer Ilott also captured two as Gloucestershire, 252 behind on first innings, slumped to 27 for four at the close on the third day of the four-day game at Colchester. Essex, who started the current round of matches in fifth place 20 points behind leaders Derbyshire with a game in hand, could go top if they complete victory on Monday's last day and other results favour them. Williams thrust Essex on course for success by dispatching Matt Windows and Andrew Symonds in his second over, before Ilott removed Dominic Hewson and Tim Hancock to reduce Gloucestershire to 17 for four at one stage. The visitors had started the day optimistically by sending back former England captain Graham Gooch when he added just six to his overnight 105, but Essex went on to make 532 for eight before declaring. Captain Paul Prichard plundered 88 from 73 deliveries, hitting 15 fours and one six. Second-placed Kent were frustrated by rain which prevented any play at Cardiff, where they have reached 255 for three in their first innings against Glamorgan, while third-placed Surrey are facing an uphill task against Nottinghamshire. Surrey slipped to 88 for four in reply to Notts' commanding first innings of 446 for nine declared at Trent Bridge, before Alistair Brown struck a 55-ball half-century. Brown's 56 not out, containing eight fours and three sixes, lifted Surrey to 128 for four on a rain-curtailed day. Fourth-placed Leicestershire had Hampshire on the ropes at Leicester before rain intervened. Pace trio David Millns (2-24), Gordon Parsons (3-20) and Vince Wells (2-19) had Hampshire reeling at 81 for seven in reply to the home county's first innings of 353. Yorkshire rekindled their title hopes after three successive defeats by taking the upper hand against arch-rivals Lancashire at Old Trafford. Facing Yorkshire's 529 for eight declared, Lancashire were forced to follow on 206 behind after being bowled out for 323, paceman Darren Gough polishing off the innings with a burst of three wickets for one run in 17 deliveries. Lancashire then reached 210 for five at the close -- just four ahead -- after Neil Fairbrother hit 55 in 60 balls to add to his first innings of 86. 2508 !GCAT !GSPO Scoreboard on the third day of the third and final test between England and Pakistan at The Oval on Saturday: England first innings 326 (J.Crawley 106, G.Thorpe 54; Waqar Younis 4-95) Pakistan first innings (overnight 229-1) Saeed Anwar c Croft b Cork 176 Aamir Sohail c Cork b Croft 46 Ijaz Ahmed c Stewart b Mullally 61 Inzamam-ul-Haq c Hussain b Mullally 35 Salim Malik not out 2 Asif Mujtaba not out 1 Extras (b-4 lb-3 nb-11) 18 Total (for four wickets) 339 Fall of wickets: 1-106 2-239 3-334 4-334 To bat: Wasim Akram, Moin Khan, Mushtaq Ahmed, Waqar Younis, Mohammad Akam Bowling (to date): Lewis 12-1-76-0, Mullally 22-6-56-2, Croft 29-6-64-1, Cork 14.3-4-45-1, Salisbury 17-0-91-0 2509 !GCAT !GSPO Close of play scores in four-day English County Championship cricket matches on Saturday: Final day At Weston-super-Mare: Match abandoned as a draw - rain. Durham 326 (D.Cox 95 not out, S.Campbell 69; G.Rose 7-73). Somerset 298-6 (M.Lathwell 85, R.Harden 65). Somerset 9 points, Durham 8. Third day At Colchester: Gloucestershire 280 and 27-4. Essex 532-8 declared (G.Gooch 111, R.Irani 91, P.Prichard 88, D.Robinson 72; M.Alleyne 4-80). At Cardiff: Kent 255-3 (D.Fulton 64, M.Walker 59, C.Hooper 52 not out) v Glamorgan. No play - rain. At Leicester: Leicestershire 353 (P.Simmons 108, P.Nixon 67; S.Renshaw 4-56, J.Bovill 4-102). Hampshire 81-7. At Northampton: Sussex 389 and 112 (C.Ambrose 6-26). Northamptonshire 361 (K.Curran 117, D.Ripley 66 not out) and 42-3. At Trent Bridge: Nottinghamshire 446-9 declared (G.Archer 143, M.Dowman 107, W.Noon 57; B.Julian 4-104). Surrey 128-4 (A.Brown 56 not out). At Worcester: Warwickshire 310 (A.Giles 83, T.Munton 54 not out, W.Khan 52; R.Illingworth 4-54, S.Lampitt 4-90). Worcestershire 205-9 (K.Spiring 52). At Headingley: Yorkshire 529-8 declared (C.White 181, R.Blakey 109 not out, M.Moxon 66, M.Vaughan 57). Lancashire 323 (N.Fairbrother 86, M.Watkinson 64; D.Gough 4-53) and 210-5 (N.Speak 65 not out, N.Fairbrother 55). 2510 !GCAT !GSPO Results of Scottish league soccer matches on Saturday: Premier division Hibernian 0 Dunfermline 0 Kilmarnock 1 Celtic 3 Raith 0 Motherwell 3 Rangers 1 Dundee United 0 Playing Sunday: Aberdeen v Hearts Division one Airdrieonians 0 East Fife 0 Clydebank 1 Stirling 0 Dundee 2 Greenock Morton 1 Falkirk 1 Partick 0 St Mirren 0 St Johnstone 3 Division two Berwick 0 Stenhousemuir 6 Brechin 1 Ayr 1 Hamilton 2 Clyde 0 Queen of the South 2 Dumbarton 1 Stranraer 1 Livingston 2 Division three Alloa 1 Arbroath 1 Cowdenbeath 1 Monstrose 0 Forfar 3 Inverness 1 Ross County 1 Queen's Park 2 Played Friday: East Stirling 0 Albion 1 2511 !GCAT !GSPO Newcastle's early season teething problems continued on Saturday when they lost 2-1 at home to premier league pacesetters Sheffield Wednesday. England striker Alan Shearer gave Kevin Keegan's talent-laden side the lead from the penalty spot after 13 minutes after Wednesday's Yugoslav Dejan Stefanovic pulled down Colombian forward Faustino Asprilla. But two minutes later Wednesday equalised through Peter Atherton, who found space in the penalty area to meet Mark Pembridge's free kick with a precise glancing header. Guy Whittingham stole three points for the Yorkshire side with a goal 10 minutes from time. To add to Newcastle's misery, England striker Les Ferdinand was stretchered off in the second half. Wednesday, who escaped relegation on the final day of last season, have now won their first three games of the season. Elsewhere, title hopefuls Liverpool were held 0-0 at home by newly-promoted Sunderland, and in London, the tie between Tottenham Hotspur and Everton also ended goaless. Frenchman Frank LeBoeuf and Italian Gianluca Vialli scored their first premier league goals as Chelsea beat Coventry 2-0, and managerless Arsenal won by the same scoreline at Leicester. Last season's league and Cup winners Manchester United host 1995 champions Blackburn on Sunday. 2512 !GCAT !GSPO Results of English league soccer matches on Saturday: Premier league Aston Villa 2 Derby 0 Chelsea 2 Coventry 0 Leicester 0 Arsenal 2 Liverpool 0 Sunderland 0 Newcastle 1 Sheffield Wednesday 2 Nottingham Forest 1 Middlesbrough 1 Tottenham 0 Everton 0 West Ham 2 Southampton 1 Playing Sunday: Manchester United v Blackburn Playing Monday: Leeds v Wimbledon Division one Bolton 3 Norwich 1 Charlton 1 West Bromwich 1 Crystal Palace 3 Oldham 1 Ipswich 5 Reading 2 Oxford 5 Southend 0 Sheffield United 4 Birmingham 4 Stoke 2 Manchester City 1 Swindon 1 Port Vale 1 Wolverhampton 1 Bradford 0 Played Friday: Portsmouth 1 Queen's Park Rangers 2 Tranmere 3 Grimsby 2 Playing Sunday: Barnsley v Huddersfield Division two Brentford 3 Luton 2 Bristol City v Blackpool late kickoff Burnley 2 Walsall 1 Chesterfield 1 Bury 2 Peterborough 2 Crewe 2 Preston 0 Bristol Rovers 0 Rotherham 1 Shrewsbury 2 Stockport 0 Notts County 0 Watford 0 Millwall 2 Wrexham 4 Plymouth 4 Wycombe 1 Gillingham 1 York 1 Bournemouth 2 Division three Barnet 1 Wigan 1 Cardiff 1 Brighton 0 Carlisle 0 Hull 0 Chester 1 Cambridge 1 Darlington 4 Swansea 1 Exeter 2 Scarborough 2 Hartlepool 2 Fulham 1 Hereford 1 Doncaster 0 Lincoln 1 Leyton Orient 1 Northampton 3 Mansfield 0 Rochdale 0 Colchester 0 Scunthorpe 1 Torquay 0 Add Division two Bristol City 0 Blackpool 1 2513 !GCAT !GSPO Torrential rain and two quick wickets held up Pakistan's efforts to bat England out of contention in the third and final test at the Oval on Saturday. A spectacular downpour halted play after seven overs and five balls of the afternoon session on the third day with Pakistan, 1-0 up in the three-match series, 12 runs ahead on 338 for four. The touring team had resumed after lunch on 318 for two but England gained some much-needed breathing space by removing both Saeed Anwar and Inzamam-ul-Haq with the score on 334. Anwar went past his previous test best of 169 against New Zealand in Wellington in 1993-94 but fell short of becoming the sixth Pakistan batsman to score a double hundred against England. He had reached 176 in 379 minutes with 26 fours when he mistimed a pull-shot against Dominic Cork and skied a catch to Robert Croft at mid-on. Inzamam had perished to a short delivery from Alan Mullally at the other end just minutes earlier, hooking the ball down the throat of Nasser Hussain at deep square-leg, having made 35 in 80 deliveries. The double success dragged England back from the abyss they had been staring into since Friday evening when their bowlers were dispatched to all parts of the Oval. Mullally and Croft kept things much tighter in the first hour of the morning, conceding just 25 runs and removing the prolific Ijaz Ahmed for 61. The Pakistan number three, who has failed to pass 50 just once in the series, had added three to his overnight score when he edged a widish delivery from Mullally to Alec Stewart behind the stumps. Captain Mike Atherton experimented unsuccessfully with Ian Salisbury, whose three overs in the day cost 20 runs, and the first five overs with the second new ball from Cork and Chris Lewis cost 28. The seamers finally located some swing after lunch, but Cork blotted his copybook with an unecessary shove on Anwar when the batsman was looking the other way at the bowler's end. Match referee Peter van der Merwe indicated he would wait 24 hours before deciding whether Cork would receive any form of punishment. The umpires, meanwhile, ordered an early tea and planned an inspection of the ground at 4 p.m. (1500 GMT). A fair amount of water fell on the pitch and surrounds before the ground staff were belatedly able to cover the vital areas. The covers were removed and play was set to start again when further showers swept in from the west, ruling out a prompt resumption. The umpires eventually took another look under threatening grey skies and decided to restart at 5.15 p.m. (1615 GMT) provided there was no further rain. 2514 !GCAT !GSPO Pakistan tightened the screws on England on the third day of the final test at The Oval on Saturday as opener Saeed Anwar moved relentlessly towards the first double century of his test career. Adopting a more restrained approach than on the previous evening, the Pakistanis added another 89 runs in the morning session to reach 318 for two at lunch, a deficit of just eight runs. Anwar was unbeaten on 169 and Inzamam-ul-Haq 30 not out. The left-hander has already equalled his previous test best against New Zealand in Wellington in 1993-94 and looks well capable of becoming the sixth Pakistan batsman to score a double hundred against England. England's bowlers did at least find a better line in the first hour, conceding only 25 runs and removing the prolific Ijaz Ahmed for 61. The Pakistan number three, who has failed to pass 50 just once in the series, had added three to his overnight score when he edged a widish delivery from Alan Mullally to Alec Stewart behind the stumps. Inzamam, a century-maker at Lord's in the first test, was content to play himself in until the shackles were broken by the re-introduction of leg-spinner Ian Salisbury, enduring a dismal return to test cricket. His first three balls of the day to Anwar cost 10 runs and he earned an ironic cheer from the crowd when he finally delivered his first dot ball. Captain Mike Atherton was forced to withdraw him from the attack after just three overs, opting instead to hand Dominic Cork and Chris Lewis the second new ball. Neither could make a breakthrough as the pitch continued to offer scant assistance and a frustrated Cork was guilty of some ill-judged petulance when he shoved Anwar aside at the bowlers' end. 2515 !GCAT !GSPO Pakistan were 318 for two at lunch on the third day of the third and final test at The Oval on Saturday in reply to England's 326 all out. Score: England 326 (J.Crawley 106, G.Thorpe 54. Waqar Younis 4-95). Pakistan 318-2 (Saeed Anwar 169 not out, Ijaz Ahmed 61). 2516 !GCAT !GSPO Third-seeded Wayne Ferreira of South Africa won a 7-5 6-2 baseline battle with third-seeded Thomas Enqvist of Sweden in the quarterfinals of the $2 million Canadian Open on Friday. Ferreira, ranked 10th in the world, plays seventh-seeded Todd Martin of the United States in one of Saturday's semifinals. Martin defeated compatriot Alex O'Brien 6-4 6-4 Friday. Ferreira, 24, has made the quarterfinals or better in all five events he's played since Wimbledon. "That's the kind of consistency I've been looking for," he said. The other semifinal features Marcelo Rios of Chile, the fourth seed, against unseeded Todd Woodbridge of Australia. Rios turned his game around after a one-sided first set to get by Australian Patrick Rafter 0-6 7-6(7-4) 6-1. Woodbridge, ranked 43rd, handled the overpowering game of his countryman Mark Philippoussis 7-5 6-4 in the 76-minute match. Ferreira took the first set from Enqvist with a service break in the 11th game. After losing the first game of the second set, Enqvist, ranked 14th, received treatment from the tournament trainer for a strained right shoulder. "I played solid tennis," said Ferreira. "I had a lot break-point chances in the first set and I knew that if I kept the pressure on I would eventually get a break." Martin returned serve solidly to hand O'Brien his first loss in 10 matches. O'Brien entered the Canadian Open ranked a career-high 76th after winning the New Haven tournament last week. But against the 13th ranked Martin he couldn't get his serve-and-volley game into gear. "I think the best part of his game is that he puts so much pressure on your serve," O'Brien said. "When a guy is returning serve that well, you start to press a little and start to miss more first serves. Rios had some inspired moments against Rafter, but none in the first set. For a w hile it looked like Rios, ranked 11th, might not win a game. The 70th-ranked Aussie took a 4-0 lead after running 11 consecutive points. Rios didn't win a game until the second game of the second set. "When the match started I was not moving a lot and I wasn't feeling very good on the court," Rios said. "After that I started holding my serve and I got a little bit of confidence and played well in the third set." Rios went on a run of his own, winning the first five games of the third set. The 19-year-old Philippoussis, ranked 29th, had blown his early-round opponents off the court with his serve. 2517 !GCAT !GSPO Results from the Canadian Open tennis tournament on Friday (prefix numbers denotes seedings): Quarterfinals 3-Wayne Ferreira (South Africa) beat 5-Thomas Enqvist (Sweden) 7-5 6-2 4-Marcelo Rios (Chile) beat Patrick Rafter (Australia) 0-6 7-6 (7-4) 6-1 7-Todd Martin (U.S.) beat Alex O'Brien (U.S.) 6-4 6-4 Todd Woodbridge (Australia) beat Mark Philippoussis (Australia) 7-5 6-4 2518 !GCAT !GSPO New Zealand made history on Saturday when they completed their first series victory in South Africa with a 33-26 victory in the second test. The win gave the All Blacks an unbeatable 2-0 lead in the three-test series. Each side scored three tries and the Springboks outscored the All Blacks 15-12 in the second half but still suffered a fourth successive defeat against their old enemies. Two tries from wing Jeff Wilson in the first quarter gave New Zealand a 24-11 lead before tries from flanker Ruben Kruger and scrum-half Joost van der Westhuizen in the space of two minutes narrowed the gap to a single point at 23-24. The Springboks would have gone ahead had not fly-half Joel Stransky's conversion hit an upright and New Zealand only scrambled to safety through a fine penalty from replacement fly-half Jon Preston and a drop goal by number eight Zinzan Brooke. 2519 !GCAT !GSPO New Zealand beat South Africa 33-26 (halftime 21-11) in the second test on Saturday. Scorers: South Africa - Tries: Hannes Strydom, Ruben Kruger, Joost van der Westhuizen. Penalties: Joel Stranksy (3). Conversion: Stranksy. New Zealand - Tries: Jeff Wilson (2), Zinzan Brooke. Penalties: Simon Culhane, Jon Preston (2). Conversions: Culhane (3). Drop goal: Zinzan Brooke. New Zealand lead the three-test series 2-0. 2520 !GCAT !GSPO Results of Yugoslav league soccer matches played on Saturday: Division A Cukaricki 0 Hajduk 2 Becej 2 Borac 0 Mladost (L) 0 Zemun 0 Rad 1 Buducnost (P) 0 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Becej 3 2 1 0 5 1 7 Partizan 2 2 0 0 6 2 6 Vojvodina 2 2 0 0 4 1 6 Red Star 2 2 0 0 3 1 6 Mladost (L) 3 1 1 1 6 4 4 Rad 3 1 1 1 2 2 4 Hajduk 3 1 0 2 3 3 3 Cukaricki 3 1 0 2 5 6 3 Buducnost 3 1 0 2 3 5 3 Zemun 3 0 2 1 2 3 2 Proleter 2 0 1 1 1 4 1 Borac 3 0 0 3 0 8 0 Division B Sutjeska 3 Sloboda 2 Loznica 0 Obilic 1 OFK Kikinda 1 Radnicki (N) 0 Spartak 1 Buducnost (V) 2 OFK Beograd 2 Mladost (BJ) 2 Standings: Obilic 3 3 0 0 8 1 9 Loznica 3 2 0 1 7 3 6 Sutjeska 3 2 0 1 6 3 6 OFK Kikinda 3 2 0 1 4 1 6 Buducnost (V) 3 2 0 1 4 3 6 Spartak 3 1 1 1 3 3 4 Zeleznik 2 1 0 1 4 4 3 OFK Beograd 3 0 3 1 4 4 3 Radnicki 3 1 0 2 5 6 3 Sloboda 3 0 1 2 4 8 1 Mladost (BJ) 3 0 1 2 2 6 1 Rudar 2 0 0 2 0 6 0 2521 !GCAT !GSPO Results of Polish first division soccer matches on Saturday: Amica Wronki 3 Hutnik Krakow 0 Sokol Tychy 5 Lech Poznan 3 Rakow Czestochowa 1 Stomil Olsztyn 4 Wisla Krakow 1 Gornik Zabrze 0 Slask Wroclaw 3 Odra Wodzislaw 1 GKS Katowice 1 Polonia Warsaw 0 Zaglebie Lubin 2 LKS Lodz 1 Legia Warsaw 3 GKS Belchatow 2 2522 !GCAT !GSPO Taranaki pulled off the biggest surprise of the New Zealand rugby season by beating national champions Auckland 42-39 to lift the Ranfurly Shield at Auckland's Eden Park on Saturday. The central North Island's Taranaki side, newly promoted to the first division and without their inspirational captain and All Black prop Mark Allen, had not won a match in seven outings this season. But they took advantage of an Auckland side missing several key players who are in South Africa with the All Blacks to claim their first shield since 1963. In a thrilling match which saw the lead change several times, both teams scored five tries. For Taranaki, who led 18-15 at halftime, inside centre Dean Magon touched down three times in the second half, with flyhalf Jamie Cameron and fullback Daryl Lilley kicking 17 points between them. A couple of tries early in the second half appeared to give Auckland the advantage and they led 39-32 going into the closing minutes. But a Lilley penalty and Magon's splendid final converted try put Taranaki back in front for the final time five minutes from the finish. Taranaki's first defence of the shield will be next Saturday against another of the strongest New Zealand provincial teams, North Harbour, in New Plymouth. 2523 !GCAT !GSPO Ginebra San Miguel routed Formula Shell 120-103 on Friday evening at the close of the semifinal round of the Philippine Basketball Association second conference. The two teams will meet again in a playoff on Sunday to decide which of them will face early finalist Alaska Milk in a best-of-seven series for the title. The Gins set the tone for the match early when they raced to a 23-point lead in the first quarter against a Shell team weakened by the absence of injured team captain Benjie Paras and point guard Ronnie Magsanoc. In the second game, Alaska beat Purefoods Hotdogs 103-95 in overtime. The Milkmen finished the semifinal round with a 14-4 win-loss card, while Ginebra wound up with 12-6 and Shell 10-8. 2524 !GCAT !GSPO Results of semi-final round games on Friday in the Philippine Basketball Association second conference, which includes American players: Alaska Milk beat Purefoods Hotdogs 103-95 (34-48 half-time) Ginebra San Miguel beat Shell 120-103 (65-56) 2525 !GCAT !GSPO Results of South Korean pro-baseball games played on Friday. Samsung 13 Hyundai 3 Haitai 5 Hanwha 4 OB 4 Lotte 2 Ssangbangwool 1 LG 0 Standings after games played on Friday (tabulate under won, drawn, lost, winning percentage, games behind first place) W D L PCT GB Haitai 62 2 40 .606 - Ssangbangwool 56 2 47 .543 6 1/2 Hanwha 55 1 47 .539 7 Hyundai 54 5 47 .533 7 1/2 Samsung 47 5 53 .471 14 Lotte 43 5 52 .455 15 1/2 LG 44 5 56 .443 17 OB 40 5 59 .407 20 1/2 2526 !GCAT !GSPO American adventurer Steve Fossett, who in 1995 completed the first solo crossing of the Pacific Ocean by balloon, on Saturday broke the world speed record for crossing it solo by sail. Fossett, 52, sailed non-stop aboard his trimaran "Lakota" from Yokohama, Japan, to San Francisco in 20 days, 12 hours and 53 minutes, knocking three days off the speed record set by John Oman in July 1994, according to Bo Kemper, Fossett's project manager. "This is Steve's greatest accomplishment in sailing. To be the world record holder in this will give Steve great personal satisfaction," Kemper said early on Saturday. The 4,525-nautical-mile journey officially ended on Saturday morning when Fossett's craft crossed beneath San Francisco's Golden Gate Bridge. It was Fossett's eighth world speed record in 24 months, said Kemper, speaking by phone from Chicago. Fossett's trimaran, with a maximum speed of 34 knots, was equipped with a global positioning system for navigation and a satellite imaging system for weather. He spoke to Kemper throughout the journey through satellite communications. During his trip, Fossett, a Chicago securities dealer, struggled through days with little breeze to propel him and other days when 30 knot winds and 11-foot (three metre) waves battered his craft. Champagne was pouring dockside as his 60-foot (18-metre) carbon fiber craft sailed into the Schoonmaker Point Marina in Sausalito, across the bay from San Francisco. Fossett passed beneath the Golden Gate Bridge at 4:04 a.m. PDT (1104 GMT on) Saturday, several hours later than expected, Kemper said. Fossett, who funded the voyage himself and had no sponsor, has devoted much of his time to going after world records in both sailing and ballooning. In February 1995, he became the first person to fly a balloon solo across the Pacific, taking off from South Korea and landing in a field in Saskatchewan, Canada. His 6,000-mile (9,600-km) voyage set a new world absolute ballooning distance record. Then in August 1995, Fossett and three crew members sailed from Yokohama to San Francisco in 16 days, knocking almost five days off the old Japan-San Francisco sailing record of 21-1/2 days set by the clipper ship "James Stafford" in 1885. Also in 1995, Fossett knocked six hours off the Los Angeles-Honolulu sailing record. He also holds Atlantic crossing records, by both balloon and sail. This year, Fossett was less fortunate. He failed in a bold attempt in January to circle the globe in a balloon. The daring voyage ended abruptly when he made a forced landing in a snow-covered Canadian pasture. Kemper said Fossett was planning this November to try once again to circumnavigate the globe by balloon. 2527 !GCAT !GSPO Major League Baseball standings after games played on Friday (tabulate under won, lost, winning percentage and games behind): AMERICAN LEAGUE EASTERN DIVISION W L PCT GB NEW YORK 73 54 .575 - BALTIMORE 67 60 .528 6 BOSTON 64 65 .496 10 TORONTO 60 69 .465 14 DETROIT 46 82 .359 27 1/2 CENTRAL DIVISION CLEVELAND 76 52 .594 - CHICAGO 69 61 .531 8 MINNESOTA 64 64 .500 12 MILWAUKEE 61 68 .473 15 1/2 KANSAS CITY 58 72 .446 19 WESTERN DIVISION TEXAS 74 55 .574 - SEATTLE 66 61 .520 7 OAKLAND 62 69 .473 13 CALIFORNIA 60 68 .469 13 1/2 SATURDAY, AUGUST 24TH SCHEDULE SEATTLE AT BOSTON MILWAUKEE AT CLEVELAND CALIFORNIA AT BALTIMORE TORONTO AT CHICAGO OAKLAND AT NEW YORK DETROIT AT KANSAS CITY TEXAS AT MINNESOTA NATIONAL LEAGUE EASTERN DIVISION W L PCT GB ATLANTA 80 47 .630 - MONTREAL 69 58 .543 11 NEW YORK 59 70 .457 22 FLORIDA 59 70 .457 22 PHILADELPHIA 53 76 .411 28 CENTRAL DIVISION ST LOUIS 68 60 .531 - HOUSTON 68 61 .527 1/2 CINCINNATI 64 63 .504 3 1/2 CHICAGO 63 63 .500 4 PITTSBURGH 55 73 .430 13 WESTERN DIVISION SAN DIEGO 70 60 .538 - LOS ANGELES 68 60 .531 1 COLORADO 66 63 .512 3 1/2 SAN FRANCISCO 54 72 .429 14 SATURDAY, AUGUST 24TH SCHEDULE CHICAGO AT ATLANTA ST LOUIS AT HOUSTON NEW YORK AT LOS ANGELES MONTREAL AT SAN FRANCISCO CINCINNATI AT FLORIDA PITTSBURGH AT COLORADO PHILADELPHIA AT SAN DIEGO 2528 !GCAT !GSPO Ray Lankford hit a third-inning solo homer and Donovan Osborne and two relievers made it stand up as the St. Louis Cardinals continued their dominance of the Houston Astros with a 1-0 victory on Friday. The Cardinals, who snapped a three-game losing skid, took over possession of first place from Houston in the National League Central Division. Osborne (11-8) allowed five hits, walked six and struck out six and seven innings. In Atlanta, Chipper Jones hit two solo homers and Marquis Grissom had a two-run double in the fourth inning to extend his hitting streak as the Atlanta Braves edged the Chicago Cubs 4-3 on Friday. Greg Maddux (12-10) allowed three runs and four hits with seven strikeouts in seven innings for the Braves, who won for the 10th time in their last 12 games. Jones hit solo homers in the first and fifth innings to help stake Maddux to a 4-0 lead. At Colorado, Jeff King singled in two runs and stole home as part of a three-run first inning as the Pittsburgh Pirates defeated the Colorado Rockies 5-3. Jermaine Allensworth singled to lead off the inning and went to third on a double by Al Martin. King lined a 3-2 pitch from Kevin Ritz (13-10) to centre field to drive in both runs and took second in the throw home. At Florida, the Marlins and the Cincinnati Reds split a doubleheader. In the first game, the Reds built an early lead on two-run doubles by Barry Larkin and Thomas Howard and held on for a 6-5 victory. Giovanni Carrara (1-0) went seven-plus innings, allowing three runs and seven hits with three walks and six strikeouts for the Reds, who handed Florida its third straight loss. But in the second game, Gary Sheffield homered and drove in four runs and Al Leiter matched his career high with 11 strikeouts over 6-2/3 innings to take the Marlins to an 8-3 victory. Sheffield's three-run homer, his-career high 36th, came in the sixth off starter Kevin Jarvis (6-6) and gave the Marlins an 8-1 lead. Sheffield, who had three hits. has 99 RBI. In San Diego, Todd Zeile hit his career-high 20th homer to break a sixth-inning tie and Jim Eisenreich added three hits and two RBI to pace the Philadelphia Phillies to a 7-4 victory over the San Diego Padres. Zeile's solo shot with one out in the sixth gave the Phillies a 4-3 lead and Eisenreich's single chased starter Tim Worrell (7-7) for Dario Veras. The loss trimmed San Diego's lead in the National League West to one game over second-place Los Angeles. And in Los Angeles, Raul Mondesi and Erik Karros had two-run doubles in the fifth inning as the Los Angeles Dodgers defeated the New York Mets 7-5. Todd Worrell allowed one hit in a scoreless ninth and broke his own team record with his 33rd save. In San Francisco, Henry Rodriguez's second home run of the game sparked a four-run seventh inning, lifting the wild card-leading Montreal Expos to a 10-8 victory over the San Francisco Giants. The Expos won their second straight game following a three-game losing streak. They recorded just their sixth win in 15 games to maintain a 1-1/2-game lead over the Los Angeles Dodgers in the race for the National League wild card spot. 2529 !GCAT !GSPO Wade Boggs capped a three-run second inning with a two-run double and Mariano Rivera pitched the final 2-1/3 innings for his fifth save as the New York Yankees held off the Oakland Athletics 5-3 on Friday. The Yankees won for the fifth time in their last 14 games. "Anytime you win, it's exciting," New York's Cecil Fielder said. "It feels good because we know we can play better than we've been. We've really got to get Baltimore out of our minds, not worry about them, worry about us." In Baltimore, Shawn Boskie allowed four hits over 6-1/3 innings and Chili Davis and Jim Edmonds homered as the California Angels blanked the Baltimore Orioles 2-0 for their third straight victory. Boskie (12-6) walked three and struck out seven in improving to 4-1 lifetime against the Orioles. The Orioles have lost four of their last six games and fell six games behind the first-place New York Yankees in the American League East. In Boston, Ken Griffey Jr hit a three-run homer and Dan Wilson delivered a two-run single in a five-run eighth inning that gave the Seattle Mariners a 6-4 victory over the Boston Red Sox. Tom Gordon held the Mariners without a hit for six innings and limited them to two hits into the eighth. He left after issuing a leadoff walk to former Red Sox Jeff Manto in the eighth. Mark Brandenburg (4-5) gave up a single to Alex Rodriguez before Griffey smacked his 39th homer into the right-field bleachers. In Chicago, Pat Hentgen pitched a six-hitter for his ninth win in 10 starts and Ed Sprague's two-run homer capped a three-run third inning that carried the Toronto Blue Jays to their sixth consecutive victory 4-2 over the Chicago White Sox. Hentgen (16-7) tossed his major league-leading eighth complete game. Hentgen walked none, struck out six and retired 15 straight batters before Ray Durham doubled with one out in the bottom of the seventh. In Cleveland, Marc Newfield's two-out single in the top of the 11th inning scored John Jaha with the go-ahead run as the Milwaukee Brewers edged the Cleveland Indians 6-5. Jaha led off the 11th by singling against Jose Mesa (2-4), stole second and advanced to third on a groundout by Kevin Seitzer. Jose Valentin was intentionally walked before Newfield lined an 0-1 pitch in front of diving centre fielder Kenny Lofton. Newfield was thrown out trying to stretch it to a double. "To stay in there and win this game is big for us," Jaha said. "The key for me is to stay nice and easy and the ball seems to jump off the bat." In Kansas City, A.J. Sager scattered seven hits over 6 1/3 innings and three players homered in the seventh as the Detroit Tigers edged the Kansas City Royals 3-2 for their fourth straight win. Sager (3-2) pitched six scoreless innings before allowing a two-run homer to Bob Hamelin in the bottom of the seventh. At Minnesota, Rick Aguilera fired an eight-hitter for his fifth win in six decisions and Marty Cordova and Dave Hollins hit two-run doubles as the Minnesota Twins routed the Texas Rangers 9-2. Aguilera (7-5) allowed two runs, walked one and recorded a career-high 10 strikeouts for his second complete game. 2530 !GCAT !GSPO Results of Major League Baseball games played on Friday (home team in CAPS): American League BOSTON 6 Seattle 4 Milwaukee 6 CLEVELAND 5 (11 innings) California 2 BALTIMORE 0 NEW YORK 5 Oakland 3 Toronto 4 CHICAGO 2 Detroit 3 KANSAS CITY 2 MINNESOTA 9 Texas 2 National League Cincinnati 6 FLORIDA 5 (1ST GM) FLORIDA 8 Cincinnati 3 (2ND GM) ATLANTA 4 Chicago 3 St Louis 1 HOUSTON 0 Pittsburgh 5 COLORADO 3 LOS ANGELES 7 New York 5 Philadelphia 7 SAN DIEGO 4 Montreal 10 SAN FRANCISCO 8 2531 !GCAT !GSPO Result of a Portuguese first division soccer match on Saturday: Belenenses 2 Boavista 4 2532 !GCAT !GSPO Dutch champions Ajax Amsterdam faltered in their second league match of the season on Saturday losing 2-0 away at Heerenveen. Ajax, who had a dismal series of pre-season results before beating NAC of Breda in their opening game, had the best of an entertaining first half but failed to break the deadlock. Eight minutes after the interval, Heerenveen's Romeo Wouden broke through the Amsterdam defence, left defender John Veldman standing and curled the ball beyond goalkeeper Edwin van der Sar into the Ajax net. Ajax, without injured defenders Marcio Santos and Winston Bogarde and strikers Jari Litmanen and Marc Overmars, then stepped up the pace and looked certain to equalise. But they left gaps at the back and on 73 minutes Danish striker Jon Dahl Tomasson rushed out of his own half, beat the Ajax defence and lobbed van der Sar. The defeat means Ajax's main title contenders PSV Eindhoven, who beat the champions 3-0 in the traditional league curtain-raiser, can go three points clear of their rivals if they beat Groningen on Sunday. 2533 !GCAT !GSPO Results of Belgian first division matches on Saturday: Standard Liege 3 Molenbeek 0 Anderlecht 2 Lokeren 2 Cercle Brugge 2 Mouscron 2 Antwerp 1 Lommel 4 Ghent 3 Aalst 2 Lierse 4 Charleroi 0 Sint Truiden 3 Ekeren 1 2534 !GCAT !GSPO A goal by Czech forward Vladimir Smicer spurred Lens to a 1-0 win at Nantes on Saturday to become the only team with maximum points after three games in the French soccer league. Newcomer Smicer, one of the stars of the European championship finals in England last June, seized his chance from just outside the box in the 52nd minute. His shot bounced on a defender's leg and left Nantes keeper Eric Loussouarn no chance. Lens, a club from a small norhern mining town, are now alone in the lead as the three other teams who had won their two opening games -- Auxerre, Bastia and Paris St Germain -- all drew. Defending champions Auxerre, who were away to Bordeaux, and Paris St Germain, who travelled to Nancy on Friday, both managed only goalless draws. Bastia, who had surprised by winning their first two matches, drew 1-1 at Nice. James Debbah put the home team in front six minutes before halftime and Anto Drobnjak equalised for the Corsican side with eight minutes remaining. Lens top the 20-strong league with nine points followed by four teams on seven points -- Bastia, Paris St Germain, Auxerre and Cannes. "We had never won in Nantes before so I'm delighted," said Lens trainer Slavo Muslin. "It's much too early to make us favourites for the title but I must say that I'm very satisfied with my team so far." There was disappointement for Marseille, back with the best after spending two years in the second division because of a match-rigging scandal and heavy debts. The former European champions suffered their first loss of the season when they were beaten 2-1 by Metz. Marseille, playing before their home fans, went in front after 24 minutes thanks to Xavier Gravelaine. But they were reduced to 10 men in the 60th minute when Italian central defender Alberto Malusci was sent off for a second bookable offence. Metz then scored two goals in quick succession through Amara Traore in the 65th minute and Mariano Bombarda four minutes later. "I heard people say that our defence was worrying and it did look that way," said Marseille general director Jean-Michel Roussier. "But until Malusci got sent off, we were doing fine. We have lost but it's not the end of the world. The season is still long." Monaco, listed among the favourites when the league restarted earlier this month, also lost their first match in Guingamp, where they fell 2-1. Liberian striker Christopher Wreh, who just joined Guingamp on loan from Monaco, scored twice in the 15th and 42nd minutes. Enzo Scifo scored for Monaco in the 35th minute. "Of course I'm disappointed," said Tigana trainer Jean Tigana. "Perhaps it was a mistake to lend them Wreh but we made it easy for him. Our defence was terrible." 2535 !GCAT !GSPO Leading goalscorers in the French first division after Saturday's matches: 3 - Anto Drobnjak (Bastia), Xavier Gravelaine (Marseille). 2 - Miladin Becanovic (Lille), Enzo Scifo (Monaco), Vladimir Smicer (Lens), Christopher Wreh (Guingamp). 2536 !GCAT !GSPO Summaries of French first division matches on Saturday: Nantes 0 Lens 1 (Smicer 52nd). Halftime 0-0. Attendance 16,000. Nice 1 (Debbah 39th) Bastia 1 (Drobnjak 82nd). 1-0. 6,000. Lille 3 (Boutoille 47th, Becanovic 79th pen, 82nd)) Rennes 1 (Guivarc'h 60th pen.) 0-0. 6,000. Bordeaux 0 Auxerre 0. 30,000. Marseille 1 (Gravelaine 24th) Metz 2 (Traore 65th, Bombarda 69th). 1-0. 20,000. Strasbourg 1 (Zitelli 80th) Le Havre 0. 0-0. 15,000 Caen 1 (Bancarel 70th) Lyon 1 (Caveglia 89th). 0-0. 9,000. Guingamp 2 (Wreh 15th, 42nd) Monaco 1 (Scifo 35th). 2-1. 7,000. Montpellier 0 Cannes 1 (Charvet 8th). 0-1. 10,000. Played on Friday: Nancy 0 Paris St Germain 0. 15,000. 2537 !GCAT !GSPO Standings in the French soccer league after Saturday's matches (tabulate under played, won, drawn, lost, goals for, goals against, points): Lens 3 3 0 0 6 1 9 Bastia 3 2 1 0 4 1 7 Paris Saint-Germain 3 2 1 0 3 0 7 Auxerre 3 2 1 0 3 0 7 Cannes 3 2 1 0 4 2 7 Lille 3 2 0 1 4 3 6 Bordeaux 3 1 2 0 2 1 5 Monaco 3 1 1 1 5 3 4 Marseille 3 1 1 1 5 4 4 Metz 3 1 1 1 3 3 4 Lyon 3 1 1 1 4 4 4 Guingamp 3 1 1 1 2 2 4 Rennes 3 1 0 2 4 6 3 Strasbourg 3 1 0 2 1 3 3 Montpellier 3 0 2 1 1 2 2 Nantes 3 0 1 2 2 5 1 Nancy 3 0 1 2 2 5 1 Nice 3 0 1 2 2 5 1 Le Havre 3 0 1 1 1 3 1 Caen 3 0 1 2 1 5 1 2538 !GCAT !GSPO Results of French first division matches on Saturday: Nantes 0 Lens 1 Nice 1 Bastia 1 Lille 3 Rennes 1 Bordeaux 0 Auxerre 0 Marseille 1 Metz 2 Strasbourg 1 Le Havre 0 Caen 1 Lyon 1 Guingamp 2 Monaco 1 Montpellier 0 Cannes 1 Played on Friday: Nancy 0 Paris St Germain 0 2539 !GCAT !GSPO Summaries of Dutch first division soccer played on Saturday: Graafschap Doetinchem 3 (Ibrahim 20th and 63rd minutes, Godee 54th) RKC Waalwijk 2 (Dos Santos 38th, Van Arum 73th, penalty). Halftime 1-1. Attendance 7,000 Willem II Tilburg 0 Fortuna Sittard 1 (Hamming 65th). 0-0. 7,250. NAC Breda 1 (Arnold 70th) Sparta Rotterdam 0. 0-0. 11,500. Heerenveen 2 (Wouden 53rd, Dahl Tomasson 74th) Ajax Amsterdam 0. 0-0. 13,500. 2540 !GCAT !GSPO Result of Dutch first division soccer match played on Saturday: Graafschap Doetinchem 3 RKC Waalwijk 2 Willem II Tilburg 0 Fortuna Sittard 1 NAC Breda 1 Sparta Rotterdam 0 Heerenveen 2 Ajax Amsterdam 0 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Graafschap Doetinchem 2 1 1 0 4 3 4 Fortuna Sittard 2 1 1 0 1 0 4 PSV Eindhoven 1 1 0 0 4 1 3 Twente Enschede 1 1 0 0 3 1 3 Vitesse Arnhem 1 1 0 0 2 0 3 Heerenveen 2 1 0 1 3 3 3 NAC Breda 2 1 0 1 1 1 3 Ajax Amsterdam 2 1 0 1 1 2 3 Utrecht 1 0 1 0 2 2 1 Feyenoord Rotterdam 1 0 1 0 1 1 1 Roda JC Kerkrade 1 0 1 0 1 1 1 Volendam 1 0 1 0 1 1 1 Groningen 1 0 1 0 0 0 1 RKC Waalwijk 2 0 1 1 4 5 1 Sparta Rotterdam 2 0 1 1 0 1 1 Willem II Tilburg 2 0 1 1 0 1 1 AZ Alkmaar 1 0 0 1 0 2 0 NEC Nijmegen 1 0 0 1 1 4 0 2541 !GCAT !GSPO Leading third round scores in the German Open golf championship on Saturday (Britain unless stated): 193 Ian Woosnam 64 64 65. 199 Thomas Gogele (Germany) 67 65 67, Robert Karlsson (Sweden) 67 62 70, Ian Pyman 66 64 69, Fernando Roca (Spain) 66 64 69. 200 Diego Borrego (Spain) 69 63 68, Miguel Angel Martin (Spain) 66 66 68. 201 Stephen Ames (Trinidad) 68 65 68, Roger Chapman 72 62 67, Paul Broadhurst 62 70 69, Stephen Field 66 65 70, Carl Suneson (Spain) 65 66 70 202 Greg Turner (New Zealand) 70 67 65, Heinz-Peter Thul (Germany) 70 67 65, Ronan Rafferty 64 72 66, Barry Lane 68 67 67, David Carter 66 69 67, Michael Jonzon (Sweden) 67 67 68, David Williams 67 67 68 203 Lee Westwood 66 71 66, Gary Emerson 68 69 66, Peter Baker 70 66 67, Des Smyth (Ireland) 66 69 68, Paul Lawrie 66 69 68, Francisco Cea (Spain) 68 66 69, Pedro Linhart (Spain) 67 67 69, Jonathan Lomas 67 67 69, Paul Eales 67 68 68, Raymond Russell 63 69 71 2542 !GCAT !GSPO Summaries of German first division matches played on Saturday: Bochum 1 (Jack 66th minute) Arminia Bielefeld 1 (Molata 59th). Halftime 0-0. Attendance 25,000 Borussia Moenchengladbach 1 (Andersson 22nd) Karlsruhe 3 (Haessler 33rd, Dundee 45th, Keller 90th). 1-2. 20,000 Stuttgart 2 (Balakow 50th, Bobic 61st) Werder Bremen 1 (Votava 68th). 0-0. 32,000 1860 Munich 1 (Schwabl 38th) Borussia Dortmund 3 (Zorc 59th-pen, Moeller 73rd, Heinrich 90th). 1-0. 50,000 Bayer Leverkusen 0 Fortuna Duesseldorf 1 (Seeliger 47th). 0-0. 18,000 Freiburg 1 (Zeyer 52nd) Cologne 3 (Gaissmayer 9th, Polster 86th, 90th). 0-1. 22,500 2543 !GCAT !GSPO Results of German first division soccer matches played on Saturday: Bochum 1 Arminia Bielefeld 1 Borussia Moenchengladbach 1 Karlsruhe 3 Stuttgart 2 Werder Bremen 1 1860 Munich 1 Borussia Dortmund 3 Bayer Leverkusen 0 Fortuna Duesseldorf 1 Freiburg 1 Cologne 3 Played on Saturday: St Pauli 4 Schalke 4 Hansa Rostock 0 Hamburg 1 Bundesliga standings after Saturday's games (tabulate under played, won, drawn, lost, goals for, goals against, points): Cologne 3 3 0 0 7 1 9 VfB Stuttgart 2 2 0 0 6 1 6 Borussia Dortmund 3 2 0 1 9 5 6 Hamburg 3 2 0 1 7 3 6 Bayer Leverkusen 3 2 0 1 7 4 6 VfL Bochum 3 1 2 0 3 2 5 Karlsruhe 2 1 1 0 5 3 4 Bayern Munich 2 1 1 0 3 2 4 St Pauli 3 1 1 1 7 7 4 1860 Munich 3 1 0 2 3 5 3 Freiburg 3 1 0 2 5 10 3 Fortuna Duesseldorf 3 1 0 2 1 7 3 Hansa Rostock 3 0 2 1 3 4 2 Arminia Bielefeld 3 0 2 1 2 3 2 Borussia Moenchengladbach 3 0 2 1 1 3 2 Schalke 3 0 2 1 4 8 2 Werder Bremen 3 0 1 2 4 6 1 MSV Duisburg 2 0 0 2 1 4 0 2544 !GCAT !GSPO Results of Austria first division soccer matches played on Saturday: Rapid Vienna 0 FC Linz 0 GAK 2 Austria Vienna 2 Admira/Wacker 0 Sturm Graz 3 Linzer ASK 1 FC Tirol Innsbruck 3 Standings (tabulated under played, won, drawn, lost, goals for, against, points): FC Tirol Innsbruck 6 4 2 0 13 5 14 Austria Vienna 6 4 2 0 9 5 14 SV Salzburg 5 3 2 0 4 1 11 Sturm Graz 6 2 3 1 8 5 9 GAK 6 1 3 2 8 10 6 Rapid Wien 5 0 5 0 3 3 5 SV Ried 5 1 1 3 6 5 4 Linzer ASK 5 0 3 2 4 8 3 Admira/Wacker 6 0 3 3 5 10 3 FC Linz 6 0 2 4 1 9 2 2545 !GCAT !GSPO Overnight leader Ian Woosnam made a sensational start to the third round of the German Open on Saturday with an eagle three at the 541-yard opening hole. After five holes, Woosnam had moved four strokes clear of playing partner Robert Karlsson of Sweden and England's Ian Pyman, who was playing one hole ahead. Woosnam, who shot 64 in each of the first two rounds for a 14-under aggregate of 128, moved to 18-under with his blistering start. The Briton is especially keen to win for it will take him to first place in the European Order of Merit above present leader Colin Montgomerie. 2546 !GCAT !GSPO The one-day match between Sri Lanka and a World XI was abandoned on Saturday because of rain. Scores: World XI 102-0 (M.Waugh 39 not out, S.Tendulkar 56 not out) off 21.4 overs v Sri Lanka. 2547 !E41 !ECAT !GCAT !GJOB The Zimbabwean government fired thousands of workers on Saturday for defying an order to end a strike which has crippled essential services and disrupted international and domestic flights. The Public Service Commission (PSC) said in a statement that the workers, including nurses, junior doctors, mortuary attendants, customs officers and firefighters, would be barred from entering their workplaces on Monday. "All civil servants who did not return to work at their normal working hours, and remained working for the full working day on 23 August 1996, have been summarily dismissed...with immediate effect," it said in a statement. A union security officer from the Public Service Association (PSA) said police had arrested, for the second time this week, union executive secretary John Makoni and his deputy, Charles Chivuru, for inciting the workers to stay on the streets. "They are in the hands of the police," said the officer who refused to be named. He said the union planned a Sunday meeting to discuss a new strategy after the arrests and sackings. The two leaders were arrested on Wednesday but released soon after Public Service, Labour and Social Welfare Minister Florence Chitauro pledged to negotiate with the union. But preliminary talks broke down on Thursday after workers ignored a government demand that they return to work before serious negotiations could start over their demands for wage rises of 30 to 60 percent. Chitauro told state radio on Saturday her ministry had already begun recruiting other people to replace the strikers, sub-contracting some of the work to private firms. The government had been threatening to fire the workers since the strike began on Tuesday, saying it was illegal. The stoppage has left essential services stretched with many hospitals handling only emergency cases under senior doctors with the help of army medical personnel and the Red Cross. It has also disrupted flights. Some internal services were cancelled -- leaving tourists at the Victoria Falls resort stranded -- and flights abroad were delayed. The PSA said 80 percent of the country's 180,000 civil servants took part in the strike which is a rare challenge to President Robert Mugabe, who had been in power since independence from Britain in 1980. Opposition parties, civic organisations and private-sector unions have expressed support for the action and denounced the government's pay rises of up to eight percent for its workers. Civil servants earn on average Z$1,000 ($100) a month. They say their pay has not kept up at all with inflation, currently running at 22 percent. 2548 !E51 !E512 !ECAT !GCAT !GDIP Leaders of 12 southern African countries met in the Lesotho capital Maseru on Saturday to discuss and sign a series of protocols aimed at furthering relations and economic development in the region. South African President Nelson Mandela said the protocols to be signed later on Saturday at the annual summit of the Southern African Development Community (SADC) were of crucial importance "It is an important summit which is one of the most well attended. We are going to sign four protocols, one on trade, the second on transport, the third on energy and the fourth on combatting illegal drug trafficking. "These are matters which are very crucial," Mandela told reporters before the start of the summit. The trade protocol is aimed at eventually establishing a free-trade area in the SADC region -- grouping South Africa, Namibia, Lesotho, Swaziland, Botswana, Malawi, Mozambique, Angola, Tanzania, Zambia, Zimbabwe and Mauritius. The protocol aims to simplify trade procedures to promote intra-regional trade and also aims at eliminating tariff barriers in the region. South African, the regional economic giant, has been criticised by Zambia and Zimbabwe for high tariffs for imports. After Pretoria recently struck a trade deal with Zimbabwe, cutting its tariffs on some imported Zimbabwean goods, Zambia has been pushing for similiar treatment. In his opening address, Lesotho's King Letsie III hinted at regional differences over South Africa's trade policies. "The free movement of measures of production, goods and services across regional borders is not entirely in the spirit and convention of the shared nature within our region," he said. SADC officials said the protocol on combatting drug trafficking could go a long way to securing regional cooperation in the fight against illicit drugs. Southern Africa has in recent years become a safe route for drugs destined for Europe and the United States. International drug gangs increasingly use South Africa as a base for operations. The protocol will seek increased cooperation between regional law-enforcement agencies and is aimed at developing a database of known criminals and their international connections. Botswanan President Ketumile Masire, SADC chairman, told delegates that the region had achieved much in the past year. He said peace seemed to be returning to Angola where the government and UNITA opposition movement were working towards integrating their troops after nearly two decades of civil war. He said although most countries in southern Africa had shown increased economic growth, most of the region's inhabitants still lived in poverty. 2549 !C12 !CCAT !GCAT !GCRIM !GHEA !GPRO Talk show host Morton Downey Jr., who recently underwent surgery for lung cancer, on Saturday denied a lawyer's statement that he planned to sue the tobacco industry for his illness. Steven Kramer, a New York City personal injury lawyer who has filed several cases against the industry, said last week that Downey was one of his clients and that he was preparing a tobacco suit on Downey's behalf. Downey, in a telephone interview from his Sherman Oaks, Calif. home, said he had never agreed to take such action. He said that Kramer had written him asking him to be a named plaintiff in a class action suit. "He said I would be a perfect lightening rod for a class action," Downey said. Downey said he called Kramer and refused to participate. Kramer could not be reached for comment Saturday. "I'm not a litigious person," Downey said. "I think this is a case of an attorney trying to use a celebrity to help forward his own agenda." Downey, who was in Washington D.C. Friday for President Clinton's approval of Food and Drug Administration regulation of cigarettes, said Kramer asked to meet with him when he returned to California this weekend. Downey said he refused. "Although I believe the tobacco manufacturers are tobacco terrorists who have lied to the public for decades about not regulating the amount of nicotine they put in cigarettes I do not believe in class action suits. "No one forced me to smoke," Downey said. "It was a stupid decision that I made myself and I only have myself to blame for what happend to me. The trouble today is that people will not take responsibility for their own actions." Downey, who contracted lung cancer after smoking for 50 years, has become a volunteer spokesperson for the American Lung Association and appears on a public service announcement for the group aimed at discouraging children from smoking. 2550 !C11 !C13 !CCAT !GCAT !GPOL The director-general of the BBC called on Friday for an increase in the British television licence fee to protect what he said was "the most successful cultural institution in the world". Speaking at the Edinburgh International Television Festival, John Birt said the fee -- payable by all television set owners -- had fallen in real terms over the past decade and described the recent financial history of the BBC as "miraculous". He said an increase was needed to help fund new services as digital technology multiplies the number of channels available. "The BBC is the most successful cultural institution in the world, one of the great inventions of the 20th century. But it can no longer be taken for granted," Birt said. "If it (the BBC) is to innovate with high-quality services in the new technologies as it has done again and again ... then at some point in the future -- and for the first time since 1985 -- we shall need a real increase in the licence fee." A colour television licence costs 89.50 pounds ($139.10) annually. Licence income totals around 1.8 billion pounds each year -- 95 percent of BBC income. The money funds the BBC's five national radio stations as well as its two television channels. Sources at the BBC said it wanted a modest rise in "low single (percentage) figures over time". The BBC will shortly begin talks with the government to review the licence fee -- currently pegged to inflation. Any price increase would take effect from April 1, 1997. A general election is due in Britain by next May and the government might be reluctant to saddle viewers with a higher licence fee shortly before it went to the polls. Birt said the BBC was now towards the bottom of the European licence fee league table. He added that a top-rate subscription to satellite broadcaster BSkyB, the dominant force in British pay television, costs 300 pounds annually. The BBC says it has achieved cost savings of 100 million pounds in each of the past three years and aims to build on its commercial success as Europe's biggest broadcasting exporter. But Birt said more licence money was vital. Digital technology -- which will allow the creation of hundreds of new channels and interactive services such as home shopping -- is set to reach Britain next year. BSkyB is planning to launch digital satellite services in late 1997 and a terrestrial version is expected to follow within a further 12 months. The BBC is planning to offer licence-fee payers supplementary programming and a 24-hour news service as it moves into the digital era. "It (digital) will mean upholding our national role -- and opening new doors wherever we can for licence fee payers," Birt added. ($1=.6436 Pound) 2551 !GCAT !GVIO A British aid worker, held hostage in Chechnya for nearly four weeks, said on Saturday a cocked Kalashnikov had been thrust into his mouth at one point during his ordeal. Michael Penrose, a 23-year-old worker with the group Action Against Hunger, described his ordeal to a news conference when he arrived back in Britain from Moscow. "The worst period of physical manhandling was during that time when we were beaten with Kalashnikovs and at one point I had a Kalashnikov held to the back of my throat -- cocked," he said. "For the first period we were held in a small room with no bed or anything. We had very little food and sometimes went two or three days without eating." Gunmen seized Penrose, who comes from Swerford in southern England, Frenchman Frederic Malardeau and six other hostages from their car in Grozny, the capital of Chechnya, on July 27. The assailants had demanded a ransom of 300,000 pounds ($465,000) but no money was paid by the charity when they were released on Wednesday. The hostages were held in a house in or near Grozny which was bombarded regularly. "During the last 15 days of being held, the fighting in Grozny was very close. At first it was street fighting outside the house and then we came under very heavy shelling and bombardment from conventional weapons like tanks, artillery and grenade launchers," he said. Penrose had been working for the charity which provides food to civilians for only a few weeks before he was captured. When asked if he would return to the mountainous region where rebels have been fighting Russian troops for full independence, Penrose said: "Not for the time being. I don't think it's safe for me. But maybe in the future, depending on the circumstances." 2552 !GCAT Following are some of the major events to have occurred on August 31 in history. 12AD - Caligula (Gaius Caesar). Emperor of Rome 37-41, born. 1422 - King Henry V of England died of dysentery in France and was succeeded by his nine-month-old son as Henry VI. 1668 - John Bunyan, English author of "The Pilgrim's Progress", died in London. 1823 - The Battle of the Trocadero took place. An invited French army entered Cadiz, ending a Liberal uprising and restoring Ferdinand VII to the throne of Spain. 1880 - Wilhelmina, Queen of the Netherlands 1890-1948, born. 1888 - The body of Mary Ann "Polly" Nichols, the first victim of murderer "Jack the Ripper", was found in London. 1907 - Ramon Magsaysay, President of the Philippines 1953-57, born. 1907 - The Anglo-Russian Convention was signed in St Petersburg, settling differences between the two over Persia, Afghanistan and Tibet. 1928 - James Coburn, U.S. film actor, born. Appeared in over 60 films including "The Magnificent Seven" and "The Great Escape". 1945 - Van Morrison, Irish-born singer and songwriter, born. 1957 - Malaya became an independent member of the British Commonwealth. 1961 - In deteriorating international relations, the Soviet Union announced it was to resume nuclear weapons tests. 1962 - Trinidad and Tobago became an independent nation within the Commonwealth. 1966 - Ninety-two people were killed when a British Britannia airliner crashed in Yugoslavia. 1968 - Garfield Sobers became the first cricketer to score six sixes off one over in first class cricket. 1969 - Rocky Marciano, former U.S. world heavyweight boxing champion, was killed in an air crash in Iowa. 1973 - John Ford, American film director best known for his westerns, which included "Stagecoach", died aged 78. 1977 - Ian Smith won the Rhodesian general election with 80 per cent of the overwhelmingly white electorate's vote. 1980 - After two months of strikes, the Polish government agreed to reforms including recognition of the Solidarity trade union. 1983 - Murdered opposition leader Benigno Aquino was buried in Manila, with over a million mourners being addressed by his widow Cory. 1984 - Twenty-eight people died in a terrorist bomb attack at Kabul airport. 1986 - A DC-9 airliner collided with a light plane near Los Angeles airport and crashed into suburbs killing 85. 1986 - Henry Moore, English abstract sculptor, died aged 88. 1986 - Urho Kekkonen, Finnish statesman, Prime Minister and President from 1956 to 1982, died aged 85. 1989 - Separation announced of Britain's Princess Anne and her husband Captain Mark Phillips. 1990 - East and West Germany signed a treaty to harmonise their legal and political systems after merging on October 3. 1991 - Uzbekistan and Kyrgyzstan declared their independence from the Soviet Union. 1994 - The IRA declared a "complete cessation" of its 25-year war against British rule in Northern Ireland. 1994 - Russia pulled its last regular troops out of Germany and the Baltic states. 2553 !GCAT !GPRO Days before Prince Charles's divorce from Princess Diana becomes final, British newspapers warned him on Sunday against remarriage and speculated about his intentions towards Camilla Parker Bowles. The News of the World, claiming to have the first initimate photographs of the heir-to-the-throne and his long-time love in 20 years, published a picture of him strolling with another man and two women near a country house in Wales. The newspaper said the photo resulted from an anonymous tip-off but there was speculation that it had been deliberately posed as part of a campaign to gain acceptance of Parker Bowles, widely tipped as being the next wife of the future king. Buckingham Palace denied it had connived the photo opportunity. "We would not give approval to such intrusive photographs being taken of the Prince of Wales in his private time. Paparazzi shots do not amount to a conspiracy," a spokeswoman said. The newspaper also claimed that Charles, whose 15-year marriage will be dissolved on Wednesday, is considering giving a television interview to explain how he feels about the divorced mother of two. A survey published in The Sunday Telegraph showed that Anglican bishops and clergy were strongly against against any remarriage, believing it would be extremely difficult for Christians to tolerate. "Many Christians feel that a marriage once made cannot be ended, so remarriage is not possible. It would cause considerable unhappiness and bring tensions to the surface," the Bishop of Manchester, Christopher Mayfield, told the newspaper. "I don't think, quite frankly, the public could tolerate a Queen Camilla," added Rev John Taylor, the retired Bishop of St Albans. Charles, who admitted adultery with Parker Bowles after he separated from Diana, has said he has no immediate intention to remarry but following his divorce he could change his mind. He will be on holiday with his two sons in Scotland when the divorce become final. His soon-to-be ex-wife will keep an equally low profile and plans to have a quiet day at Kensington Palace when the marriage becomes one of Britain's latest divorce statistics. 2554 !GCAT !GDIP !GPOL !GVOTE A former British minister accused President Bill Clinton on Sunday, the eve of the U.S. Democratic convention, of exploiting the Northern Ireland peace process and putting votes before lives. (Corrects from "putting lives before votes") Michael Mates, a member of the ruling Conservatives who served as Britain's Northern Ireland minister from 1992 to 1993, said Clinton had abused his power in the hopes of turning American-Irish sympathies into votes for himself in the U.S. presidential election in November. "To the people of Northern Ireland the failure of the terrorists to end their evil trade is a continuing tragedy," Mates wrote in the Mail on Sunday newspaper. "To Clinton it is an opportunity for a much-needed diplomatic and electoral triumph." Mates, 62, who resigned as Northern Ireland minister amid controversy over his support for fugitive businessman Asil Nadir, accused Clinton of seeking the credit for the Anglo-Irish peace initiative in Northern Ireland. He said the president would urge British Prime Minister John Major to allow Sinn Fein, the political wing of the Irish Republican Army (IRA) guerrillas, to take part in "all-party" peace talks when they resume next month. The IRA, which favours a united Ireland, has fought a quarter-century battle to end British rule in Northern Ireland. Sinn Fein has been banned from the talks until the IRA reinstates a 17-month ceasefire which it ended in February with a huge bomb blast in the Docklands area of east London. This was the first of a series of bombs on the British mainland. Mates said Clinton wants Major to allow Sinn Fein into the talks if it denounces the IRA campaign of violence, even if the bombings continue. "It is a naive, vain and craven posture, which one hopes has been given the sharpest rebuff by the British government," Mates added. Clinton was pandering to 40 million Americans of Irish descent, he said, who were clustered in key U.S. voting areas. The U.S. stance was indicative of the "arrogance combined with ignorance" that it sometimes used to influence Northern Ireland politics, he added. The United States involvement in Northern Ireland affairs has been a difficult issue between Washington and London. Britain was miffed when the United States granted a visa to Sinn Fein leader Gerry Adams and allowed him to raise funds there. Protestant Northern Ireland politicians were also not pleased with the appointment of former U.S. senator George Mitchell as chairman of the all-party peace talks. But Clinton won praise from both the British and Irish governments when he visited the troubled province on an emotional peace mission last year. Mates said the vote-winning agenda of Clinton's advisers was "not so much (about) peace, as giving Irish Republicans what they want at any price". "If he wants to help the peace process in Ulster, Clinton should put lives before votes," Mates said, adding that no IRA representative should be allowed into the United States without a binding declaration that they had denounced violence permanently. 2555 !GCAT !GPRO Britain's Queen Elizabeth plans to vacate Buckingham Palace as part of her programme to update and improve the 1,000-year-old monarchy, a British newspaper said on Sunday. The People, a popular tabloid weekly, said the queen and other remembers of the royal family would withdraw gradually from the imposing palace in the heart of London over the next few years. The building would become a year-round tourist attraction and office block for royal staff. "The queen has made a shock decision to quit Buckingham Palace," The People said in a front-page story. It said the move was one of several changes a special committee, comprising the queen, her family and royal advisers, was considering. A spokeswoman for Buckingham Palace dismissed the report. "It is pure speculation. We've not gone into any of the details of what has been outlined in the media during the week." Last week British newspapers said giving up state subsidies, allowing the monarch to marry a Roman Catholic and changing the laws of succession to allow the oldest child - even if a girl - to take the throne, were among the options being considered. The queen has already opened up Buckingham Palace to tourists during the summer months to help pay for repairs to Windsor Castle, her main residence west of London, which was badly damaged in a fire four years ago. 2556 !GCAT !GDIS !GENV LONDON, Aug 24, Reuter - Twenty thousand people have been evacuated from the Ethiopian town of Wanji, flooded after a swollen river burst its banks, Ethiopian radio reported on Saturday. The radio, monitored by the BBC, said the Awash river, swollen by water released from the Koka dam, burst through three dykes. Twenty thousand people -- 90 percent of the town's population -- were evacuated while others fled to the top of a nearby hill, the radio said. Soldiers were trying to save those left in the town and had recovered one body. Reports from Ethiopia on Friday said the river burst its banks and flooded more than 2,000 hectares (5,000 acres) of sugar cane and workers' homes. 2557 !GCAT !GDIP !GVIO Britain on Saturday offered to host peace talks between the two main Kurdish factions in northern Iraq following a U.S.-brokered ceasefire in the region. A Foreign Office statement said Britain welcomed the truce announced on Friday aimed at ending six days of fighting between the Kurdistan Democratic Party (KDP) and the Patriotic Union of Kurdistan (PUK). Clashes between northern Iraq's fractious Kurds had threatened a U.S.-led peace plan to unite the mountainous region against President Saddam Hussein. The Foreign Office said: "We hope that the talks in September announced by the United States will lead to a durable peace agreement between the two Kurdish parties. We stand ready to host talks in London if this will help reach such an agreement." The United States said leaders of the two parties had agreed to end six days of fighting which had shattered a previous ceasefire negoiated last year by Washington. U.S., British and French planes have been patrolling the skies of northern Iraq since shortly after the 1991 Gulf War to shield Iraq's Kurds from any attack by Iraqi troops. The safe haven operation was spearheaded by British Prime Minister John Major. The Kurds agreed early last year to end more than a year of clashes that cost some 3,000 lives. But a full peace deal, agreed to at U.S.-sponsored talks in Ireland, is in limbo. 2558 !GCAT !GPRO Britain's Princess Diana has sent a message to seriously ill Mother Teresa, the nun to whom she has turned several times for spiritual guidance. Diana's office said on Saturday the princess had sent a message to the Nobel Peace Prize-winning missionary as news broke this week of her battle against heart problems and malaria. A spokeswoman declined to release details of the message. Diana first met the Albanian-born missionary in Rome in 1992. She said afterwards that the meeting had fulfilled her "dearest wish" and the two women have met several times since. The princess, who has carved out a major role for herself as a helper of the sick and needy, is said to have turned to Mother Teresa for guidance as her marriage crumbled to heir to the British throne Prince Charles. The 85-year-old nun said in the past that she was praying for the couple, whose divorce is expected to become final next week. Doctors caring for Mother Teresa in a Calcutta hospital said on Saturday that her fever had fallen and her malaria was under control but she remained on a respirator in intensive care. 2559 !C12 !CCAT !GCAT !GCRIM Lloyd's of London said on Saturday that it had been ordered by a U.S. judge to make more information available to all U.S. names by September 23. A spokesman for the insurance market said it had been told in a 100-page court order from U.S. district Judge Robert Payne that any U.S. name could accept or reject Lloyd's recovery plan before September 23. He said the insurance market had been told any U.S. name who accepted had to pay no later than September 30 into an escrow account. He added that Payne had set a trial date of November 4. 2560 !GCAT !GSPO Saeed Anwar c Croft b Cork 176 Aamir Sohail c Cork b Croft 46 Ijaz Ahmed c Stewart b Mullally 61 Inzamam-ul-Haq c Hussain b Mullally 35 Salim Malik not out 2 Asif Mujtaba not out 1 Extras 18 Fall of wicket - 1-106 2-239 3-334 4-334 To bat - Wasim Akram, Moin Khan, Mushtaq Ahmed, Waqar Younis, Mohammad Akam England 326 all out 2561 !GCAT !GSPO Nijmeh of Lebanon beat Nasr of Saudi Arabia 1-0 (halftime 1-0) in their Asian club championship second round first leg tie on Saturday. Scorer: Issa Alloush (45th minute). Attendance: 10,000. 2562 !GCAT !GPOL NIGER GOVERNMENT LIST (960824) ************************************************************ * 22 Sep 96 - Parliamentary elections. * ************************************************************ - - - - - - - President........................Gen Ibrahim Bare MAINASSARA (Elected July 96 for a five-year term, sworn in 7 Aug 96) - - - - - - - NATIONAL SALVATION COUNCIL (Formed 28 Jan 96) Chairman.........................Gen Ibrahim Bare MAINASSARA Vice Chairman..................Col Youssoufa Mamoudou MAIGAR - - - - - - - GOVERNMENT (Apptd 23 Aug 96) Prime Minister (Apptd 30 Jan 96)................ Boukary ADJI - - - - - - - MINISTERS OF STATE: Finance & Planning..............................CISSE Amadou Foreign Relations..............................Andre SALIFOU - - - - - - - MINISTERS Agriculture & Livestock........................Brah MAHAMANE Civil Service, Labour & Employment........... . Seyni Ali GADO Communication............................... Inoussa OUSSEINI Defence.........................Ousmane Issoufou OUBANDAWAKI Deputy Minister at the presidency for cooperation & Integration.......................... Ibrahim Gagi MAYAKI Education...................................Aissata MOUMOUNI Health............................... SAMBO Abdoulaye Mariama Higher Education & Research..........Harouna Hamidou SIDIKOU Interior.......................................Idi ANGO Omar Justice & Human Rights.........................Boube OUMAROU Mines & Energy..............................Mai Manga BOUKAR Public Works.................................... Cherif CHAKO Social Development, Population, Advancement of Women & Protection of Children..................... Rabi Dady GAO Tourism & Crafts..................... . DIALLO Aissa Abdoulaye Trade & Industry..............................Jacques NIGNON Transport...................................Souley ABDOULAYE Water supply & Environment...............Kada Labo ABOUBACAR Youth, Sports & National Solidarity.....................Lt-Col Abdouramane SEYDOU - - - - - - - SECRETARIES OF STATE For the Budget............................... Ibrahim KOUSSOU For Development & Economic Relations...... . Yacouba NABASSOUA For the Interior.......................Attaher ABDOULMOUMINE For Social Development.......................Harouna NIANDOU - - - - - - - Central Bank Governor....................Charles KONAN BANNY (Central Bank of West African States) - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End Government List) 2563 !GCAT !GDEF !GDIS A German airman was killed on Saturday when two German fighter planes crashed during training exercises in Labrador in eastern Canada, the Canadian Armed Forces said. Three other crew members involved in the crash were airlifted to hospital at Goose Bay, Labrador, and were listed in stable condition. "Any indentifying information is being withheld until proper notification of next of kin, which is going to take a little time given the fact that these are members of the German forces," said Captain Vicki Fraser of the Canadian Armed Forces. The armed forces released a statement saying the cause of the incident was unknown and an investigation will take place. A team of investigators has been sent to the crash site. The two German Tornado fighter planes carrying two crew members each crashed on Saturday morning about 100 miles (160 km) northwest of Goose Bay. Three crew members were located by search and rescue teams soon after the crash. The fourth crew member was later found dead. The air crew were part of a visiting Naval Air Wing Squadron from Germany and were conducting routine flight training, the armed forces said. 2564 !GCAT !GDEF !GDIS Two German fighter planes carrying four pilots crashed on Saturday morning during routine training exercises in Labrador in eastern Canada, the Canadian Armed Forces said. They said in a statement that three of the pilots had been located and were being taken to a hospital with unconfirmed injuries, while the status of the fourth crew member was unknown. A search and rescue centre in Halifax later said the fourth pilot had been located. The armed forces identified the aircraft involved as German Tornadoes and said the exact cause of the incident was unknown. 2565 !GCAT !GODD About 350 adventurers from nine countries set out on Saturday to climb, raft, bike and run in a 323-mile (517-km) endurance race through the Canadian wilderness. The event, called the Eco-Challenge, is part of a growing sport known as adventure racing in which competitors test their limits for days over a perilous wilderness course. "I'm looking forward to this race. I think it will be more physically challenging and we'll have to go up against more diverse situations due to the terrain," said Dr. Michael Stroud, a veteran Eco-Challenge participant. The Eco-Challenge has been staged twice before -- in Utah and Maine last year -- and is modelled on similar races overseas. The 70 teams in this year's race will will trek glaciers, climb mountains, whitewater raft, horseback ride, canoe and mountain bike along the grueling course. This year's race, the route of which was keep a secret until Friday evening, is being held near Pemberton, British Columbia, about 100 miles (160 km) northeast of Vancouver. The area is filled with treacherous mountain peaks, ice fields and frigid waters. Organisers expect about two-thirds of the participants to drop out or be disqualified before the finish. The hardy ones are expected to complete the course in about six days, with first-place finishers receiving $10,000 in prize money. In the Eco-Challenge, competitors race in teams of five which must include both men and women. Team members must remain within 100 yards (metres) of each other at all times and finish together. With racers carrying about 40 pounds (18 kg) of gear on their backs, broken bones, sunstroke, dehydration and exhaustion are common. 2566 !GCAT !GENT French film legend Jeanne Moreau, a standard bearer of France's struggling motion picture industry, on Friday defended the economic might and international public appeal of American films. "Nobody imposes the American films. They are here because the public likes them, and one has to respect the tastes and the minds of the public," Moreau told reporters at the opening of Montreal's 20th World Film Festival. Moreau, the festival's jury president, responded in both French and English to reporters who pressed her to comment on the "invasion" of U.S. films in national markets worldwide. Having lived through Germany's conquest of France during the Second World War, Moreau said speaking of a U.S. film "invasion" of France and elsewhere evoked too strong an image. "The word invasion had a sort of connotation for me related to war. So I don't like to use that expression concerning cinema," she said. Moreau said she regularly watched American films but refused to be drawn by film critics into criticising the artistic merit of U.S. movies. "Some of them are extraordinary. Some of them are less good, but it's true that there is a real cleverness and a lot of money, you know, that can allow you to make interesting films," she said. Moreau admitted she "deplored" the manner in which American films and television shows were underpricing European products to dominate certain Eastern European markets, but she noted that French television has been copying U.S. sitcoms and games shows like "The Price is Right." Moreau, the doyene of French cinema who has worked with the world's greatest directors -- including Luis Bunuel, Louis Malle, Francois Truffault and John Frankenheimer -- said that after Montreal's 12-day festival, she was going to New York to promote her latest film, "The Proprietor". Moreau praised the Montreal festival for being truly international in its lineup. Although American director Edward Burns' warmly received romantic comedy, "She's The One", made its international premiere to open the festival on Thursday, some 400 feature films, shorts and videos from 60 countries were being screened. 2567 !E51 !E512 !ECAT !GCAT !GCRIM !GDIP Leaders of southern African states on Saturday signed a series of protocols binding them to trade liberalisation and fighting illicit drug trafficking. "By signing these protocols we have not only demonstrated our unwavering commitment to regional integration but we have also set a daunting challenge for ourselves," Botswana President Ketumile Masire told delegates to the 16th summit of the 12-member Southern African Development Community (SADC). Masire, outgoing chairman of SADC, said the four protocols signed in the Lesotho capital Maseru marked key areas of cooperation in SADC. SADC, which was formed in 1980 to lessen economic dependence on then apartheid South Africa, groups Namibia, Lesotho, Swaziland, Botswana, Malawi, Mozambique, Angola, Tanzania, Zambia, Zimbabwe, Mauritius and South Africa. South African President Nelson Mandela was elected chairman of the regional body and said it was a honour for his country to be entrusted with the chairmanship. "It is a great honour to the people of South Africa and to me personally. "The offer comes at a time when South Africa requires this gesture from countries of the region because it will strengthen the efforts of South Africans to entrench democratic values in our country," Mandela said. South Africa formally joined SADC two years ago after the demise of apartheid and the country's first democractic elections which ushered in black majority rule. The protocols, on trade, drug trafficking, energy and transport, communications and meteorology, still have to be ratified. Angola did not sign those on trade and communication "to allow internal processes to be completed", a SADC communique said. The trade protocol provides for the liberalisation of trade in the region and was one of the thorniest issues. South Africa, the region's economic giant, has been criticised by its neighbours -- especially Zambia -- over its high tariffs. Earlier this month, Pretoria settled a four-year trade dispute with Zimbabwe by agreeing to lower some tariffs but after Zambia pushed for similiar treatment, South African officials said they favoured a regional trade deal rather than pacts with indiidual countries. Masire said the protocols could be fully implemented in eight to 10 years' time although some aspects of trade and anti-drug cooperation could come into effect much sooner. The SADC move to combat illicit drug trafficking follows warnings that southern Africa was becoming a major supply route to Europe and the United States. The protocol provides for closer cooperation between regional law enforcement agencies and the judiciaries. "The protocol provides a policy framework that allows the SADC region to cooperate in ensuring that the region does not become a producer, consumer, exporter and distributor of illicit drugs, and a conduit for illicit drugs destined for international markets," the SADC communique said. 2568 !GCAT !GDIP !GVIO Zaire has expelled 28 Rwandan Hutus from refugee camps in eastern Zaire and Rwandan authorities immediately jailed 17 of them, a spokesman for Rwanda's Tutsi-dominated army said on Saturday. The refugees -- described as "prisoners" by the spokesman -- were handed over on Friday, a day after Zairean Prime Minister Kengo wa Dondo said on a visit to Rwanda that his country would expel all refugees back to Rwanda. He gave no timeframe. Rwandan army spokesman Captain Firmin Gatera told Reuters in Kigali that 17 of the 28 refugees handed over from the Zairean town of Goma had been soldiers in the former Hutu army which fled to Zaire in 1994 after being defeated by Tutsi forces in Rwanda's civil war. "These people are now in Gisenyi prison," Gatera added. He said the Zairean authorities had accused them of being "trouble-makers" in the teeming refugee camps in eastern Zaire. Zaire is home to 1.1 million Rwandan Hutu refugees who fled three months of civil war in 1994. Many had taken part in the genocide that year of one million people, mostly Tutsis, and refuse to go home for fear of reprisal at the hands of the new Tutsi-dominated government in Kigali. Tens of thousands of genocide suspects, mostly Hutus, are languishing inside Rwandan jails. Gatera said the 28 Rwandan Hutus were handed over after a meeting between the Zairean governor of north Kivu province and the Rwandan prefect of the border town of Gisenyi. State radio Rwanda reported on Saturday that 18 more refugees in the eastern Zairean town of Bukavu were handed over to Rwandan authorities earlier this week. The radio said 15 of them were former soldiers. The latest expulsions are likely to spread fear in the sprawling refugee camps in eastern Zaire. Kengo told a news conference with his Rwandan counterpart on Thursday the operation would begin with the closure of all Rwandan refugee camps in Zaire. He gave no time frame but a Rwandan official said on Friday the repatriation should be "orderly, decent and well-organised". The U.N. High Commissioner for Refugees (UNHCR) said it was not consulted over the repatriation announcement by Kengo and said it hoped the movement of refugees would be voluntary. Forced repatriation is against international conventions on refugees. 2569 !GCAT !GPOL !GVOTE Congo's Prime Minister Jacques Joachim Yhombi-Opango has presented the resignation of his government to President Pascal Lissouba, state radio said on Saturday. Official sources said Friday's resignation was a formality and would be followed by a cabinet reshuffle. The new government will run the country until presidential elections due by next August, in which Lissouba is a candidate. "President Lissouba has taken note of this resignation. He may reappoint General Yhombi-Opango or name a new prime minister," the radio said. It said the new government would pursue the structural adjustment programmes of the outgoing administration, which signed a three-year Enhanced Structural Adjustment facility with the International Monetary Fund in June. The Paris Club agreed in July to write off two-thirds of Congo's external debt. 2570 !GCAT !GDIS !GHEA An outbreak of cholera has killed 21 people in a week at Ubimini in oil-rich southern Nigeria, the News Agency of Nigeria reported on Saturday. The chairman of the local council, Damian Ejiohuo, said drugs had been rushed to the area to quell the disease and the community needed a safer source of drinking water to prevent future outbreaks. Epidemics are common in rural areas of Nigeria where piped water is not usually available. 2571 !GCAT !GDEF !GPOL !GVIO The Sudanese army on Saturday denied an opposition report that 11 military officers were executed on charges of taking part in an alleged conspiracy to blow up government targets in Port Sudan. Army spokesman General Mohamed Sanousi Ahmed told the Sudan News Agency (SUNA) that the report by the Democratic Unionist Party in Cairo about the executions was not true. Mohammed al-Mutasim Hakim, the party's spokesman in Cairo, said in a statement on Thursday that the 11 officers were shot by firing squad on Sunday. He named five of them -- two lieutenant-colonels and three majors. Ahmed told SUNA that no more than 25 people had been arrested, including 17 military men, in connection with the plot to attack vital installations in the Red Sea port and disrupt Sudan's foreign trade. Investigations continued and the majority of those summoned for interrogation had been released after questioning, he said. "According to priamary investigations with accused, there is a foreign element in the plot which we will make public at the appropriate time," SUNA quoted Ahmed as saying. Ahmed said all military and civilian suspects arrested were receiving fair treatment. Hakim charged in his statement that Sudanese authorities fabricated the conspiracy story to cover up a purge of army officers hostile Bashir. He said 56 people remained in detention in Port Sudan and their lives were in danger because of torture. In a separate report, state radio Omdurman said the government on Saturday dissolved the student union of Omdurman Ahlia University where rival student groups had been clashing with each other and with riot police in recent weeks. The fighting was over elections for the student union. Students generally opposed to Bashir's government wanted the elections to be held but Islamist students who support the government wanted them to be postponed. 2572 !GCAT !GVIO Liberia's two main faction leaders have ordered their fighters to pull back from front line positions and dismantle roadblocks, four days after the latest ceasefire was supposed to come into force. Charles Taylor, whose National Patriotic Front of Liberia started the civil war in December 1989, said he had ordered his forces to leave main roads and report to their bases. "As of now Charles Taylor or the NPFL has no more territory throughout Liberia. For us the war is over and anyone who wants to fight will have ECOMOG to fight," Taylor said in a broadcast on his Kiss FM radio station on Friday. West African peacekeepers of the ECOMOG force have the task of overseeing implementation of the latest peace accord signed in Nigeria a week ago, which sets a timetable for disarmament by the end of January and elections on May 30, 1997. A ceasefire was supposed to come into force on August 20. Alhaji Kromah, Taylor's fellow vice-chairman on the ruling Council of State and his ally during fighting in Monrovia in April and May, called on his ULIMO-K fighters to cease hostilities in the Tubmanburg region by midnight on Saturday. A statement from Kromah said he had ordered "the dissolution of all checkpoints along the Po River/Tubmanburg highway and the immediate and unconditional withdrawal of all ULIMO forces from all surrounding towns and villages". The statement called on ECOMOG to deploy in the specified areas and told ULIMO-K forces to report to base. Both Taylor and Kromah have promised to complete disarmament of their fighters by September 30. Roosevelt Johnson, the target of Taylor's and Kromah's forces in the fighting which devastated the Liberian capital in April and May, pledged on Friday to fight no more wars and to work with his rivals to unite the country. Johnson, who spent three months in exile in Ghana after the United States flew him out of Liberia at the height of the fighting, returned home on Thursday with new Council chairwoman Ruth Perry. The latest agreement threatens the faction leaders with sanctions including seizure of assets and war crimes tribunals, if they are seen to be obstructing the peace process. 2573 !GCAT !GPOL !GPRO Malawi's frail former president, Kamuzu Banda, said on Saturday in a rare public interview that he was feeling well despite his advanced years. "I feel all right and I eat everything that is put on the table. And that means I am all right," he told reporters invited to his home. Banda, a vegetarian teetotaller believed to be 97, walked unaided but supporting himself on a walking stick. He clutched a fly whisk which for a long time symbolised his obsession with power. His health was the subject of much recent speculation. Malawi's undisputed ruler for three decades, he lost power in the first all-party elections in 1994. He spent a year under house arrest and was tried but acquitted last year on charges of ordering the murder of four opponents in 1983. 2574 !GCAT !GPOL !GVOTE Togo's main opposition party and the party of former prime minister Edem Kodjo have both ruled out joining a new government after the party of President Gnassingbe Eyadema won a majority in parliament. The Action Committee for Renewal (CAR), which boycotted three by-elections earlier this month, said its policy differences with Eyadema's Togolese People's Rally (RPT) were too great and it did not feel it could join the broad-based government envisaged by new prime minister Kwassi Klutse. Kodjo's Togolese Union for Democracy (UTD), which lost to the RPT in all three by-elections, said it had not received satisfactory responses to issues it had raised at a meeting with Klutse on Friday. Klutse, minister of planning and regional development in the outgoing government, has said he plans to focus on developing Togo's economy. Real Gross Domestic Product grew 8.3 percent in 1995, the second highest rate in Africa after Malawi. Eyadema, an army general, seized power in 1967 and was elected in 1993 in polls boycotted by the UTD and CAR. Kodjo broke with opposition allies in 1994 to accept Eyadema's offer of the post of prime minister. His party governed in coalition with the RPT but the alliance has become increasingly fragile in recent months. He resigned last Monday after the RPT's third by-election win. According to the constitution, the prime minister must come from within the parliamentary majority. The RPT now has 38 seats of its own in the 81-seat parliament, plus five from allied parties and independents, giving Eyadema a comfortable majority. 2575 !GCAT !GPOL !GVOTE Prominent Gambian barrister Ousseynou Darboe has said he plans to form a political party and run against military ruler Captain Yahya Jammeh in next month's presidential election. Jammeh has banned the three main political parties but two smaller parties have said they plan to put up candidates provided they can meet tough registration conditions. "I was contacted by a cross-section of the community from Banjul to up-country and asked to contest the presidential elections," Darboe, vice-chairman of the influential Gambia Bar Association, said on Friday. He said he would submit his application to the electoral commission next week. Darboe said he intended to protest to the minister of local government about public figures such as traditional chiefs who were already campaigning on behalf of Jammeh. A decree published last Wednesday said anyone involved in politics before campaigning officially starts on September 9 would face a fine of one million dalasis ($100,000) or life imprisonment. Jammeh has said he will stand as a civilian candidate in the September 26 election but will not campaign as he does not want to get involved in politics. Candidates must gather 5,000 signatures from around the country by the September 5 registration deadline. The Commonwealth said on Tuesday the election rules were flawed and would allow the small West African country's military leaders to strengthen their grip on power. The Commonwealth last year suspended the membership of army-ruled Nigeria. Gambia's military rulers lifted a two-year ban on all political activity on August 14, then announced two days later that the country's three main parties would be excluded. They banned anyone who had served as a minister under ousted president Sir Dawda Jawara, head of state from independence from Britain in 1965 until 1994, and excluded Jawara's People's Progressive Party, the National Convention Party of Sheriff Mustapha Dibba, and Hassan Musa Camara's Gambia People's Party. 2576 !GCAT !GDIP Opposition politicians in the African home countries of migrants demanding residence papers in France on Saturday condemned the silence of their governments on the protest but conceded there was little they could do. French riot police stormed a Paris church on Friday, removing 220 African migrants including 10 on a 50-day hunger strike, to crush their protest against expulsion orders. Most of the migrants are from Mali, Senegal or Zaire, whose governments have made no comment on the affair. "Silence, it's Chirac," wrote independent Senegalese daily WalFadjry, attacking the obedient relationship between France's former colonies and French President Jacques Chirac. Mamadou Diop Decroix of the Senegalese opposition party And Jeff said it was ironic that Minister of State at the Presidency, Abdoulaye Wade, was currently in Angola to mediate over Luanda's expulsion of West African illegal traders. "The government preferred to make much more fuss over the people expelled from Angola than over those expelled from France. Despite our numerous approaches to the foreign ministry, no one wanted to know," he said. Mali's ruling ADEMA party said not all of those in the Saint-Bernard church had been illegal migrants, and urged the governments of Mali, France and other countries concerned to find a solution through dialogue. Ivory Coast's government daily Fraternite-Matin said the lack of reaction to the protest showed how little Africa could do against the might of the former colonial powers. "The silence or reserve of the governments of underdeveloped countries in the face of the semblance of a battle between the French authorities and these mistreated Africans proves the Afro-pessimists right," an editorial said. "Above all, France for example, whenever she wants, can slip around the neck of developing counties the financial noose that can strangle them or condemn them to pauperism." Ivory Coast has West Africa's most developed economy and is itself a magnet for migrant workers from neighbouring countries. French Interior Minister Jean-Louis Debre told French radio those expelled would receive financial support to help them resettle in their home countries. French Cooperation Minister Jacques Godfrain will visit Mali next month. Debre has organised about 20 charter flights to bring home illegal immigrants as part of a government crackdown in recent months. The tightening of immigration laws in 1993 has left many immigrants in a legal limbo, outlawing some who were previously living in France legally. The centre-right government, backed by a court opinion that none of the Africans in the church had an automatic right to stay in France, has said about 30 or 40 percent of the protesters would qualify for residence permits. French left-wing opposition parties have accused Prime Minister Alain Juppe of cynically courting the anti-immigrant National Front, with an eye on 1998 general elections. Fraternite-Matin compared the French expulsions with an amnesty in Spain which allowed illegal immigrants to put their papers in order. "The humiliating odysseys by charter flight of Malians from France, thrown out by force to their native countries, or the moral and physical constraints and violence suffered by those without valid papers are historical facts that future generations will not forget easily or quickly," the paper said. 2577 !E41 !ECAT !GCAT !GJOB The Zimbabwean government fired thousands of workers on Saturday for defying an order to end a strike which has crippled essential services and disrupted international and domestic flights. The Public Service Commission (PSC) said in a statement that the workers -- including nurses, junior doctors, mortuary attendants, customs officers and firefighters -- would be barred from entering their workplaces on Monday. "All civil servants who did not return to work at their normal working hours, and remained working for the full working day on 23 August 1996, have been summarily dismissed...with immediate effect," it said in a statement. Union officials from the Public Service Association (PSA) were unavailable for comment. Public Service, Labour and Social Welfare Minister Florence Chitauro told state radio her ministry had already begun recruiting other people to replace the strikers, sub-contracting some of the work to private firms. The government had been threatening to fire the workers since the strike began on Tuesday, saying it was illegal. But the strikers ignored the threat and vowed to stay on the streets until their demands for wage rises of 30 to 60 percent were met. The stoppage has left essential services stretched with many hospitals handling only emergency cases under senior doctors with the help of army medical personnel and the Red Cross. It has also disrupted flights. Some internal services were cancelled, leaving tourists at the Victoria Falls resort stranded, and flights abroad were delayed. The PSA said 80 percent of the country's 180,000 civil servants took part in the strike which is a rare challenge to President Robert Mugabe, who has been in power since independence from Britain in 1980. Opposition parties, civic organisations and private-sector unions have expressed support for the action and denounced the government's pay rises of up to eight percent for its workers. Civil servants earn on average Z$1,000 ($100) a month. They say their pay has not kept up at all with inflation, currently running at 22 percent. 2578 !GCAT !GPOL !GVIO Rwanda said on Saturday that Zaire had expelled 28 Rwandan Hutu refugees accused of being "trouble-makers" in camps in eastern Zaire. Captain Firmin Gatera, spokesman for the Tutsi-dominated Rwandan army, told Reuters in Kigali that 17 of the 28 refugees handed over on Friday from the Zairean town of Goma had been soldiers in the former Hutu army which fled to Zaire in 1994 after being defeated by Tutsi forces in Rwanda's civil war. Zairean Prime Minister Kengo wa Dondo said on Thursday in a visit to Rwanda that his country would expell all the refugees back to Rwanda but he gave no timeframe. Zaire is home to 1.1 million Rwandan Hutu refugees who fled three months of civil war in 1994. Many had taken part in the genocide that year of one million people, mostly Tutsis, and refuse to go home for fear of reprisal at the hands of the new Tutsi-dominated government in Kigali. Gatera said the refugees were handed over following a deal made at a meeting between the governor of Zaire's north Kivu region and his counterpart in the Rwandan border town of Gisenyi. "After a meeting between the governor of north Kivu and the prefect of Gisenyi, 28 prisoners (refugees) were handed over to Rwandan authorities on Friday," Gatera said. "Out of these 17 were former soldiers. These people are now in Gisenyi prison," Gatera added. 2579 !GCAT !GODD A limelight-loving South African chief was in disgrace on Saturday after a prized skull he brought home from Scotland was identified as belonging not to his sacred tribal ancestor, but to a middle-aged white woman. A forensic scientist who examined the supposed skull of 19th century King Hintsa, a chief of President Nelson Mandela's Xhosa tribe killed in battle by the British, said it was in fact the cranium of a European woman. Chief Nicholas Gcaleka, dressed in animal skins and full tribal regalia, journeyed to a wintry Scotland in February on a hugely publicised quest to find Hintsa's skull. The witchdoctor said ancestors had appeared to him in a dream and ordered him to return the head, said to have been carried off as a colonial trophy by the officer who shot and allegedly beheaded Hintsa after a battle in 1835. But Gcaleka ran into trouble as soon as he returned to South Africa with a skull he found in a cottage in a lonely Highland forest near Inverness. He said the spirit of a hurricane had guided him there. Members of the Xhosa royal family, branding Gcaleka a charlatan, confiscated the head and sent it for tests to a forensic scientist, who examined the shape of the skull and the hole that he determined had not come, as supposed, from a bullet. "It can be stated beyond reasonable doubt that this skull is not that of the late king," the scientist said in a statement. 2580 !GCAT !GPOL Niger's army ruler General Ibrahim Bare Mainassara has named an expanded cabinet, replacing the finance and defence ministers and giving the youth and sports portfolio to an army ally from his January coup. The new government under Prime Minister Boukary Adji has 20 ministers and four secretaries of state, compared to 14 ministers and three secretaries of state in the government named in February. It has no members of opposition parties, and the reshuffle, announced on Friday night, comes just a month before the date set for parliamentary elections, which are supposed to take place on September 22. Mainassara appointed Amadou Cisse, a World Bank official who was briefly prime minister in February 1995, to the finance portfolio, replacing Almoustapha Soumaila, who negotiated the resumption of contacts with the International Monetary Fund after a break of four years. The previous government was entirely civilian, but Mainassara brought in Lieutenant Colonel Abdouaramane Seydou, who served as spokesman during his January 27 coup, as minister of youth, sports and national solidarity. The defence portfolio went to a civilian, Ousmane Issoufou Oubandawaki, who works for the Agency for the Safety of Air Navigation in Africa and Madagascar (ASECNA). Another former prime minister, Souley Abdoulaye, was appointed minister of transport. Mainassara's coup ended a 16-month political standoff between former civilian president Mahamane Ousmane and his opponents who held the majority in parliament. Mainassara attracted international condemnation for sacking the independent electoral commission during presidential elections last month and placing his opponents under house arrest. He appointed a new commission, which declared him the winner with 52.22 percent of votes cast. 2581 !GCAT These are significant stories in the Nigerian press on Saturday. Reuters has not verified these stories and does not vouch for their accuracy. WEEKEND TIMES - University teaching unions banned. THE GUARDIAN ON SATURDAY - Telephone subscribers rush to pay special levies to state-run Nigerian Telecommunications (NITEL), to restore lines destroyed by fire. THISDAY - Incoming and outgoing state military administrators, moved in a recent reshuffle, are to declare their assets within the next 30 days. --Lagos newsroom +234 1 2630317 2582 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL The Zimbabwean government has fired thousands of civil servants who defied its order to stop a strike which has crippled essential social services, the Public Services Commission said on Saturday. "All civil servants who did not return to work at their normal working hours and remained working for the full working day on 23 August 1996, have been summarily dismissed...with immediate effect," it said in a statement. Public Service, Labour and Social Welfare Minister Florence Chitauro told state radio her ministry had already begun recruiting other people to replace the strikers, who included nurses, junior doctors, mortuary attendants and magistrates. The strike -- to press for wage rises of 30 to 60 percent -- began on Tuesday and has forced many hospitals to handle emergency cases only under senior doctors with the help of army medical personnel and the Red Cross. 2583 !GCAT !GVIO Sudanese police have arrested three people trying to smuggle sewing machines and army clothing to Sudanese opposition groups in Eritrea, an official newspaper reported on Saturday. The government-owned al-Ingaz al-Watani said the smugglers were caught in Banat in the eastern state of Kassala, on the border with Eritrea, and had confessed they were on their way to "the so-called alliance forces which have been undertaking subversive operations on the eastern border". Authorities in Kassala said opposition forces based in Eritrea have been laying landmines and stealing vehicles and other goods to smuggle them across the border into Eritrea. Sudan accuses the Eritrean authorities of providing support to Sudanese opposition elements based in Eritrea. Eritrea cut diplomatic ties with Sudan in 1994, accusing it of training rebels to make raids into Eritrea. The exiled National Democratic Alliance, a Sudanese umbrella opposition group, has its headquarters in the Eritrean capital Asmara. It uses the former Sudanese embassy. 2584 !GCAT !GPOL !GVIO Sudan said on Saturday more than 200 rebels from the war-torn south had surrendered to government troops there. Sudanese government radio said 225 rebels in Eastern Equatoria state, on the border with Kenya and Uganda, gave themselves up in the town of Kapoeta where the commander of government troops offered them assistance. The radio quoted an official source as saying the rebels were from the Tobosa warrior tribe, the largest ethnic group in Eastern Equatoria, and had fought alongside John Garang, the leader of the Sudan People's Liberation Army (SPLA). The rebels had joined the "peace process after numerous contacts had been made with them" and said they had endorsed the peace charter, the radio reported. The Sudanese government and a number of rebel groups, including dissident factions of the mainstream SPLA, earlier this year signed a peace charter which the government hopes will end more than 10 years of war between Khartoum and the mostly Christian and animist south. Garang's movement has yet to ratify any peace deal with the government and has consistently accused the other rebel factions of aiding the Sudan government in its war efforts in the south. The radio said the surrender of the 225 rebels was a "strong blow" to Garang's forces and reflected the widespread wish within the rebel movement for peace. 2585 !C42 !CCAT !E41 !ECAT !GCAT !GCRIM !GJOB Four men died and 48 were wounded in a shootout with police and troops outside a South African platinum mine whose striking workers had been sacked, police said on Saturday. A spokesman said security forces were fired on with automatic weapons when they moved in on Friday to break up a crowd near the Swartklip platinum mine outside the northern town of Rustenburg. The dead and wounded were believed to have been members of a group of about 600 men who were dismissed from the mine during recent labour unrest but who had camped out at the site. Police decided to confront the group after receiving reports that some of the men had firearms. After the shootout 183 men were arrested and firearms were seized, the spokesman said. An air force helicopter ferried some of the wounded miners to hospital. The mine belongs to Anglo American Corp of South Africa. 2586 !GCAT !GPOL !GVIO Moscow's peacemaker Alexander Lebed and Chechen military chief Aslan Maskhadov on Saturday moved towards agreement on the region's future as Russian troops started withdrawing from the capital Grozny. A rebel spokesman said after a day of talks in the village of Novye Atagi 20 km (12 miles) south of Grozny, Lebed and Maskhadov came close to reaching a political deal which would decide the Chechnya's future status, the heart of the conflict. "The sides agreed most points of the political document," spokesman Movladi Udugov told reporters on behalf of both negotiators. "They will meet again at 10 a.m. (0600 GMT) to finalise the document." "Both sides asked me to tell you that they are happy with the progress at the talks," Udugov added. Earlier on Saturday Russian troops and rebel fighters took part in an unprecedented ceremony to form joint patrol groops envisaged in the military deal signed by Lebed and Maskhadov on Thursday to stop the latest upsurge of Chechnya fighting. The rebels seek full independence for their mountainous land. President Boris Yeltsin, who sent troops into Chechnya in December 1994 to quell a separatist rebellion in Chechnya, says the region must remain part of the vast Russian Federation. Lebed and Maskhadov have said they have found a face-saving solution acceptable for both sides but gave no details. Prime Minister Viktor Chernomyrdin, quoted by Interfax news agency, said Lebed was likely to propose that the rebels put off any decision on Chechnya's future status until after the region recovers from the devastation caused by the 20-month war in which tens of thousands have died. Chernomyrdin said Moscow's position at talks had been masterminded by Yeltsin, making clear that the little-seen Kremlin leader who had a telephone conversation with Lebed late on Friday, was behind his envoy's package of proposals. But Lebed on his arrival to Chechnya warned that a mysterious "third force", which had ruined earlier peace efforts, might cause problems this time as well. "The 'third force' should be taken very seriously," Itar-Tass news agency quoted him as saying. Lebed did not say who he believed was behind it. Interfax quoted Lebed's aide as saying that before departure from Moscow his chief received an warning about a possible assassination attempt. Aide Vladimir Petrov gave no details. He told Interfax that similar warnings had come ahead of all Lebed's previous trips to Chechnya. To avoid any attack security has been tightened at Khankala base outside Grozny where the Kremlin envoy was based, Tass said later. Earlier on Saturday Russian troops, besieged by rebels in Grozny since August 6, started leaving the city as provided by Thursday's military deal between Lebed and Maskhadov. Rebel forces are also to withdraw from Grozny. Both sides have decided to set up joint patrol groups to guard the city. The patrol groups are also expected to maintain a ceasefire which came into force under the military agreement in Grozny and the rest of Chechnya on Friday. Both sides agreed on Saturday that the truce was generally observed during the day. "These are not soldiers of war but soldiers of peace standing here," Major-General Vyacheslav Ovchinnikov told soldiers and rebels who mingled at a ceremony to assign joint teams to different patrol groups. "We have had enough of war," the silver-headed Maskhadov, who has masterminded many successful separatist operations against Russian forces, told soldiers and fighters lined up outside the village of Starye Atagi, next to Novye Atagi. Interfax said some Russian troops had been moved from central Grozny and redeployed in suburbs. But a pullout from the southern mountain area of Shatoi was postponed for a day to give soldiers a chance to clear mines. But rebel commander Salman Amirov, appointed to oversee the Shatoi withdrawal, said the Chechens would be satisfied only when Russia's troops left Chechnya completely. "We cannot call this a withdrawal. The withdrawal will be when they leave the republic of Ichkeria," Amirov said, using the Chechen word for their region. 2587 !GCAT !GPOL !GVOTE The Moslem nationalist SDA party held an uneventful political rally in the hardline Croat bastion of Capljina on Saturday in an encouraging development for the success of Bosnia's elections. A Reuters photographer said about 500 Moslems, most of whom once lived in the town, arrived by bus and car and held a 45-minute political meeting before leaving. They were joined by the local leader of the Croat nationalist HDZ party and the town's HDZ mayor, who authorised the rally by their rivals. The SDA and the HDZ are the two main parties in a Moslem-Croat federation which controls half of the country, although Moslems and Croats fought a bitter 10-month war in 1993-4 in a sideshow to Bosnia's main Moslem-Serb conflict. Capljina, about 150 km (90 miles) southwest of Sarajevo, had a pre-war population of about 27,800 of whom 54 percent were Croat, 28 percent Moslem and 14 percent Serb. It is now virtually pure Croat and a centre for separatist Croats who identify more with Croatia than with Bosnia. Bosnians are due to vote on September 14 to elect municipal and cantonal assemblies, separate Serb and Moslem-Croat parliaments, a national House of Representatives and a three-member national presidency. International monitors fear that refugees and displaced persons trying to return to their places of origin to vote could spark violence in some areas. 2588 !GCAT !GPOL !GVIO Moscow's peacemaker Alexander Lebed and Chechen military chief Aslan Maskhadov on Saturday met for talks on the region's future as Russian troops started withdrawing from the Chechen capital. Lebed said his talks with Maskhadov in the village of Novye Atagi 20 km (12 miles) south of Grozny, were aimed at a political agreement defining Chechnya's future status -- the most sensitive issue of the whole conflict. Before they met Russian troops and rebel fighters took part in an unprecedented joint ceremony to form joint patrol groops envisaged in the military deal signed by Lebed and Maskhadov on Thursday to stop the latest upsurge of Chechnya fighting. The rebels seek full independence for their mountainous land. President Boris Yeltsin, who sent troops into Chechnya in December 1994 to quell a separatist rebellion in Chechnya, says the region must remain part of the vast Russian Federation. Lebed and Maskhadov have said they have found a face-saving solution acceptable for both sides but both have kept tight-lipped about any details. Interfax news agency quoted Prime Minister Viktor Chernomyrdin as saying that Lebed was likely to offer the rebels a deal to put off any decision on Chechnya's future status until after the region recovers from the devastation caused by the 20-month war in which tens of thousands have died. Chernomyrdin said Moscow's position at talks had been masterminded by Yeltsin, making clear that the little-seen Kremlin leader who had a telephone conversation with Lebed late on Friday, was behind his envoy's package of proposals. Earlier on Saturday Russian troops, besieged by rebels in Grozny since August 6, started leaving the city as provided by Thursday's military deal. Rebel forces are also to withdraw from Grozny. Both sides have decided to set up joint patrol groups to guard the city. The patrol groups are also expected to maintain a ceasefire which came into force under the military agreement in Grozny and the rest of Chechnya on Friday. "These are not soldiers of war but soldiers of peace standing here," Major-General Vyacheslav Ovchinnikov told orderly lines of soldiers and a motley crew of rebels who mingled at a ceremony to assign soldiers and rebels to different patrol groups. Local residents who turned up for the ceremony at a field outside the village cheered the rebels, waving green flags and shouting "Allahu Akbar" (God is Greatest). "We have had enough of war," the silver-headed Maskhadov, who has masterminded many successful separatist operations against Russian forces, told soldiers and fighters lined up outside the village of Starye Atagi, next to Novye Atagi. Interfax quoted Russian and rebel sources close to the talks as saying that the reluctance of separatist leaders to give up their army, which has proved more effective than Moscow's huge military force, could become a tricky problem to solve. Interfax said that the rebel leaders want to preserve their forces and keep them under their control. Moscow is ready to offer separatists the chance to set up designated Chechen regiments in the Russian armed forces. This report could not be independently confirmed. Chechnya appeared quiet on Saturday, although there were sporadic reports of shooting. Interfax said some Russian troops had been pulled out of Grozny. The troops would be redeployed in Grozny's suburbs. But a pullout from the southern mountain area of Shatoi was postponed for a day to give soldiers a chance to clear mines. "The Russian side say they were not ready for technical reasons and they will do it tomorrow," said Salman Amirov, a Chechen field commander overseeing the Shatoi withdrawal. But he said the Chechens would be satisfied only when Russia's troops left Chechnya completely. "We cannot call this a withdrawal. The withdrawal will be when they leave the republic of Ichkeria," Amirov said, using the Chechen word for their region. 2589 !GCAT !GPOL Albania's opposition Socialists looked ready to abandon Marxist doctrine at a party conference on Saturday after jailed Socialist leader Fatos Nano unleashed a stinging attack on those who resisted change. In an address read to the opening session of the two-day congress, he slammed the party's acting leadership for dragging its feet on reform. Nano, who still has three years to serve of a jail term for embezzlement, said the party had become entrenched in academic propaganda and had forgotten real politics. "We have never taken the lead," Nano said, in the address read by senior Socialist Sabit Brokaj. "We have simply been defending ourselves in battles others have launched." The Socialists, reformed heirs to the communists, will vote on resolutions which would scrap references to Marxist ideas from the party's programme and seek to erase its ties with almost half a century of Stalinist dictatorship. Nano made his first public call for change in July, a month after the party's chief opponents, the conservative Democrats of President Sali Berisha, almost swept the board in a disputed general election. On Saturday Nano revealed that he had proposed dropping Marxist references from the party manifesto more than a year ago and had also urged the party leadership to start taking the initiative in political debate. He said his arguments met strong resistance, however, and drew accusations that he was flirting with the Democrats. Acting leader Servet Pellumbi admitted organisational errors to the congress but blamed them on a handful of individuals. "We have to make our structures more operational," he said. Nano and Pellumbi were united in their condemnation of the ruling Democrats, however. Both argued that the Democrats had used voters' fear of a return to communism as a weapon against the Socialists. They said Nano's imprisonment was unjustified and criticised the introduction last year of the Genocide Law, which bars those who held office under the communist regime from running for government or taking up judicial posts. Pellumbi pledged that the Socialists would continue to boycott parliament. Several opposition paarties, including the Socialists, pulled out of the recent general election alleging vote rigging and intimidation. The Socialists have refused to take up the 10 parliamentary seats that they won. Pellumbi also warned that the party would refuse to take part in local elections on October 20th if it was not satisfied with the voting conditions. Among the Socialists' demands are changes to the electoral law, the repeal of the Genocide Law and the formation of electoral committees based on the results of local polls held in July 1992. The congress will elect a new leadership on Sunday. 2590 !GCAT !GPOL !GVIO !GVOTE Reports of repeated persecution of opposition parties in Bosnia's Moslem Bihac region are tarnishing the democratic image of President Alija Izetbegovic's party, Western observers say. International peace coordinator Carl Bildt visited the area in northwest Bosnia on Friday to rebuke regional bosses of the ruling Party of Democratic Action (SDA) after 28 incidents of pre-election bombings and beatings this month. Western diplomats and monitors say that SDA authorities, embittered by Serb conquests of Moslem-inhabited north and east Bosnia and the Serbs' retention of that land under the U.S.-imposed Dayton treaty, have swung the party towards authoritarian Moslem nationalism in peacetime. However officially the party's ethos is one of multi-cultural democracy. One of Bildt's aides, who asked not to be identified, said: "Bihac was a symbol of bravery in the war. We've asked the SDA if it now wants Bihac to become a symbol of human rights abuses in peace, and forego chances for redevelopment aid." Bildt and SDA officials jointly announced an accord requiring party-controlled police to halt further intimidation of SDA rivals and prosecute culprits. The Bihac canton police minister said he had sacked the police chief of Cazin, the second largest municipality in the region of 250,000-odd Moslems where most attacks had occurred. Bildt said the steps were needed to foster a climate of free expression in the run up to Western-organised elections to be staged across Bosnia on September 14. Voters will be electing joint governing institutions meant to weld Moslem, Serb and Croat sectors of Bosnia back together again, undoing the results of 43 months of war. But the intolerance of ruling parties in all three camps have raised fears that the vote will only ratify, not reverse, the violent partition of Bosnia. Western mediators and monitors are especially disillusioned by events in Bihac because the SDA, unlike Serb and Croat counterparts, waged the war on the principle of ethnic pluralism dedicated to reunifying Bosnia. The Bihac "pocket", as it was known during the war, became a byword for doughty resistance to besieging Serbs, barely surviving their blockade of U.N. humanitarian convoys. Sources close to Bildt blamed much of the violence on agents of a shadowy internal security service run by the SDA or thugs linked to the SDA-run local police. "We hope they and their superiors in Sarajevo will get the message now we've shone a high-level, high-pressure spotlight on them," said the Bildt aide. Western monitors, Bihac opposition leaders and their faithful fear Bildt's intercession may have been too late to dispel an atmosphere of fear in the region. While being interviewed, pro-opposition citizens glance edgily at passers by, some of whom stop to stare and eavesdrop. "People are afraid to speak frankly in the streets. I lost my job because I don't support SDA and because I'm a Moslem who married a half-Serb, half-Croat," said Refika Osmanagic, a former regional assembly official. "In Our Own Religion, In Our Own Land" stands out from SDA campaign posters which plaster building facades throughout the region to the almost total exclusion of opposition advertising. Opposition leaders told Reuters their placards were being ripped down by SDA men as soon as they were put up. They said they were being refused access to public halls for meetings. That forced them to convene occasionally outdoors where they could be assaulted with impunity. "All this reflects the fact that opposition sentiment may be stronger in the Bihac region than anywhere else in SDA-ruled Bosnia," a European Union monitor said. 2591 !GCAT !GDIP !GPOL !GVIO !GVOTE A top European official called on Saturday for prompt action to remedy apparent irregularities in the registration of refugees in upcoming Bosnian elections. Election monitors have accused Serb authorities of coercing Serb refugees and displaced persons to vote from towns other than their pre-war residence in order to consolidate Serb war gains made through the ethnic cleansing of Moslems and Croats. Swiss Foreign Minister Flavio Cotti warned that these "serious infractions" were threatening to distort the results of municipal elections. He spoke as Chairman-in-Office of the Organisation for Security and Cooperation in Europe (OSCE), which is supervising the September 14 elections under a mandate provided in the Dayton peace agreement. "The Chairman-in-Office is most deeply concerned about reports coming in from Sarajevo according to which serious infractions of elections procedures have taken place with the manipulation of refugee registration," said an OSCE statement. "Thousands of eligible voters appear to have registered for places like Brcko, Srebrenica, Zvornik, Doboj, Foca, etc. in which from today's perspective they would hardly ever intend to settle." In-country voting will begin on September 14 but Bosnia refugees living abroad who want to cast absentee ballots, of whom there are hundreds of thousands, begin voting on August 28 over a three-day period. By shifting tens of thousands of Serb votes from towns inside Bosnia's Moslem-Croat federation to places inside its Serb republic the Serbs hope to consolidate gains they made on the battlefield and cement the country's ethnic division. Since virtually all non-Serbs were killed or expelled from the Serb republic during the 43-month Bosnian war, many strategic towns which were once majority Moslem are underpopulated. Diplomats say the Serb strategy is to employ electoral engineering to ensure that those towns, like Brcko and Srebrenica, remain under Serb control no matter how many Moslems vote from there in person or by absentee ballot. Cotti called on the OSCE's mission in Bosnia -- particularly its Provisional Election Commission (PEC) which is the top election rule-making body -- "to take effective measures against this manipulation", the OSCE release said. The commission met and considered this issue on Friday but made no decision. OSCE sources said one option under consideration was the postponement of elections in a small number of municipalities where the registration problem seems acute. The leading Moslem SDA party in Bosnia has called on OSCE to prevent refugees from voting in places other than their pre-war homes and to postpone municipal elections entirely. SDA officials have said the party would reconsider its participation in elections if the request is not honoured. The SDA board is scheduled to meet on the matter on Sunday. The SDA-dominated Bosnian government has practical leverage over the election process. Local election commissions which administer the election process on the ground are substantially under the control of the SDA in many parts of the Moslem-Croat federation, which rules 51 per cent of Bosnia. The entire election process would come to a halt in many parts of the country if the SDA ordered the local commissions to halt work. 2592 !GCAT !GPOL !GVIO Russia began withdrawing troops from the capital of breakaway Chechnya on Saturday, as Russians and Chechens prepared to set up joint forces to patrol the wartorn region. The patrols, being sworn in in the village of Starye Atagi on Saturday afternoon, will bring Russian soldiers shoulder-to-shoulder with men they had known previously only as "bandits" and "criminals". They will enforce a ceasefire which took effect at noon (0800 GMT) on Friday, and must promise to protect each other and the lives of local residents, regardless of their nationality. Russian peacemaker Alexander Lebed, viewed by the Chechens as their best hope for resolving the 20-month-old crisis, travelled to Chechnya for the fourth time in two weeks and said a deal on Chechnya's political status would come soon. "The question of Chechnya's status is a difficult one, but we hope to find a solution in the interests of both Russia and the Chechen people," Interfax news agency quoted him as saying. An Interfax report from Moscow quoted "well-informed sources" as saying the two sides might defer a decision on Chechnya's status for five years to let the situation there return to normal. The rebels, who view Russian forces as invaders, have been seeking full indepedence for their Caucasus territory. But President Boris Yeltsin, expressing suppport for Lebed on Friday, said any political deal must define Chechnya as "an integral part of the Russian Federation". Yeltsin, who appointed Lebed his special representative in Chechnya earlier this month, sent troops to the region in December 1994 to end the independence drive. But Moscow's troops, disillusioned and poorly equipped, have never crushed rebel resistance in the mountainous south of the region and their hold on the towns has often been tenuous. The latest military humiliation came on August 6 when determined rebels swept into Grozny, capturing key buildings and trapping Russian soldiers in their checkpoints. But Chechnya appeared quiet on Saturday, although there were sporadic reports of shooting. "This Saturday can perhaps be described as the calmest and most peaceful in Chechnya fo the last 20 months," Itar-Tass correspondent Sharip Azuyev said. "People, exhausted by war, are starting to smile for the first time, hoping for peace." Interfax said some Russian troops had been pulled out of Grozny in line with an agreement reached in talks between Russian military leaders and rebel commanders. The Interior Ministry soldiers would be redeployed in Grozny's suburbs. But a pullout in the mountain village of Shatoi, in the south of the region, was postponed for a day to give soldiers a chance to clear mines. "The Russian side say they were not ready for technical reasons and they will do it tomorrow," said Salman Amirov, a Chechen field commander overseeing the Shatoi withdrawal. But he said the Chechens would be satisfied only when Russia's troops left Chechnya completely. "We cannot call this a withdrawal. The withdrawal will be when they leave the republic of Ichkeria," he said, using the Chechen word for their region. 2593 !GCAT !GPOL !GVIO Russia began withdrawing troops from the capital of breakaway Chechnya on Saturday, bringing a tentative peace plan a few steps closer to reality. But a Russian pullout in Shatoi, in the south of the region, was postponed for a day to give soldiers a chance to clear mines. Interfax news agency said Alexander Lebed, President Boris Yeltsin's special representative in Chechnya, would fly there on Saturday for talks with rebel leaders on a political deal. "The political document is expected to be signed on Saturday at a meeting between Alexander Lebed and the leaders of the (separatist) opposition," the agency said. Quoting a Chechen military source, it added: "The document will fully correspond to the interests of both the Russian Federation and the Chechen side." Yeltsin, in an abrupt reversal of comments made earlier in the week, backed Lebed's peacemaking efforts late on Friday. But he said a political deal must define Chechnya as "an integral part of the Russian Federation" -- something the separatists have so far firmly rejected. Lebed and the separatists have already brokered a truce in the region. But Russian military commanders, humiliated by an August 6 separatist raid which captured much of the Chechen capital, Grozny, have frequently accused the separatists of using ceasefires to regroup and strengthen their positions. A military spokesman said federal troop positions in Chechnya had come under fire 27 times in the last 24 hours. Lebed's deal, signed with rebel chief-of-staff Aslan Maskhadov, will also set up Russian-Chechen patrols in Grozny bringing Russian soldiers shoulder-to-shoulder with men they had known previously only as "bandits" and "criminals". The patrols will enforce a ceasefire that took effect on Friday. The first members of these patrols will be sworn in on Saturday afternoon, promising to protect the lives of local residents regardless of nationality. Lebed's latest peace breakthough came after Russian troops had threatened to flatten the Chechen capital Grozny, most of which the rebels captured on August 6, provoking the fiercest fighting in the region in more than a year. The gruff reserve general, who made his name as a peacemaker in Moldova's breakaway Dnestr region, has won the confidence of the separatists. "We are sure that Lebed will keep his word," said Salman Amirov, a field commander overseeing the Russian troop withdrawal in the mountain town of Shatoi. "I believe in Lebed, but I do not believe in the Russian leadership and its generals." Amirov said the two sides had agreed that a battalion of 500 men would leave the region, part of a 7,000-strong Russian division based there. But the pullout had been delayed. "The Russian side say they were not ready for technical reasons and they will do it tomorrow," he said. Troops wanted to clear up and clear mines before leaving the region, he added. The area, about 50 km (30 miles) south of Grozny, is a wooded, mountainous region, dotted with deep ravines and full of villages ruined in earlier fighting. Interfax said some troops had been pulled out of Grozny in line with an agreement reached in talks between Russian military leaders and rebel commanders and the Interior Ministry soldiers would be redeployed in Grozny's suburbs. But Amirov said the Chechens, who seek independence for their Caucasus territory, would be satisfied only when Russia's troops left Chechnya. "We cannot call this a withdrawal. The withdrawal will be when they leave the republic of Ichkeria," he said, using the Chechen word for their region. 2594 !GCAT !GPOL !GVIO Russia began withdrawing troops from the capital of breakaway Chechnya on Saturday but a pullout in the south of the region was postponed for one day to give soldiers a chance to clear mines. Rebel commander Salman Amirov, based in the mountain village of Shatoi, said the two sides had agreed that a battalion of 500 men would leave the region, part of a 7,000-strong Russian division based there. But the pullout had been delayed. "The Russian side say they were not ready for technical reasons and they will do it tomorrow," he said. Troops wanted to clear up and clear mines before leaving the region, he added. The area, about 50 km (30 miles) south of Grozny, is a wooded, mountainous region, dotted with deep ravines and full of villages ruined in earlier fighting. It was the scene of Russian raids after President Boris Yeltsin was reelected for a second term in office on July 3. Interfax news agency said some troops had been pulled out of the capital Grozny in line with an agreement reached in talks between Russian military leaders and rebel commanders. The soldiers, from the Interior Ministry, would be redeployed in Grozny's suburbs. But Interfax did not say how many soldiers were being pulled out. Amirov said the Chechens, who seek independence for their Caucasus territory, would be satisfied only when Russia's troops left Chechnya. "We cannot call this a withdrawal. The withdrawal will be when they leave the republic of Ichkeria," he said, using the Chechen word for their region. Russia sent troops into Chechnya in December 1994 to crush the independence bid, but the soldiers have been unable to hold on to mountainous southern regions and their grip on Chechnya's northern cities has been tenuous. Separatists captured much of Grozny on August 6, trapping Russian soldiers in their checkpoints and inside the central complex of government buildings. But tension eased on Friday after Russian peacemaker Alexander Lebed and top Chechen commanders agreed a ceasefire and promised to work towards a political solution. The truce took effect at noon (0800 GMT) on Friday and both sides say it has been broadly respected. Interfax said seven Russian servicemen had been wounded in Grozny in the past 24 hours. Hundreds of people died in the August fighting. Lebed, who won the rather belated backing of President Boris Yeltsin late on Friday, is to travel to Chechnya again at the weekend. "We are sure that Lebed will keep his word," said Amirov, echoing the sentiment of many local people to the gruff general. "I believe in Lebed, but I do not believe in the Russian leadership and its generals." 2595 !GCAT !GVIO Chechnya had never seen anything like it. Bitter enemies came together for the first time to work for peace. A surreal carnival-like atmosphere attended the unlikely union between Russian troops and separatist rebels in a field near the southern Chechen village of Starye Atagi. Hundreds of children chanted "Allahu Akbar" (God is Greatest) as the rebel convoy of cars and trucks drove past. The rebels, in trademark green headbands and hopelessly mismatched uniforms, revelled in the attention and responded to the cries with clenched fists as they sped towards the field dotted with Russian artillery positions. One vehicle flying green flag of the Republic of Ichkeria, as separatists call Chechnya, crashed off a narrow road into a ditch as the driver tried an impossible overtaking manouevre. The chaos belied the seriousness of the event -- the creation of joint security teams for the capital Grozny to ensure that the ceasefire accord which took effect last Friday is implemented and the bloodshed stops. More than 500 Russian and Chechen warriors eyed each other with a mixture of curiosity, nervousness and nonchalance as their commanders made speeches about the task facing the "soldiers of peace." The fighters earlier signed an oath swearing to carry out their joint command duties "concienciously and with honour." But rebel commanders crossed out one paragraph saying that they had to obey the orders of any superiors from the federal Russian side without question. After the formalities, the fighter mingled together at a water hose, passing it around to those desperate to quench their thirst in the baking sun. Both sides had stood in combat gear throughout an elaborate ceremony. The contrast in styles was striking. The Russians kept orderly lines, four-deep, and jumped to every officers' command. "Leave two steps to the right," barked one officer and his men complied without hesitation. However they were by no means parade-ground soldiers. Some had green headscarves tied around their heads like pirates. "I am not looking forward to do this but I got my orders and I have to carry them out," said soldier Nikolai, who was wearing sunglasses, had headphones hanging round his neck and was chewing gum. But the Russians were no match for the Chechens when it came to military fasion accessories. Their motley groups had a variety of outfits. Most were black or green berets, but a few extraverts sported green cloth wraped aound their heads Arab-style. All were weighed down with Kalashnikovs, grenade launchers and bandaliers of ammunition. Their silver-headed chief-of-staff Aslan Maskhadov gave them a pep talk in Starye Atagi, 20 km (12 miles) south of Grozny, before the meeting with the Russians. Beads of sweat ran down his brow as he addressed the assembled ranks on a soccer field. Hundreds of locals watched from the sidelines, crowded onto roofs or hanging from balconies for a better view. A grey-bearded cheer leader led a group of children chanting support for the rebels as if for their favourite team. One boy held up a protrait of former separatist leader Dzhokhar Dudayev, reported killed by a Russian rocket in April. When the cremonies were finally over, the Chechens moved forward with total disregard of military principles of marching and boarded their various vehicles to set off on their unusual mission. 2596 !GCAT Here are highlights of stories in Romania's press at the weekend. Reuters has not verified these stories and does not vouch for their accuracy: Business: ADEVARUL - Regia Autonoma a Tutunului tobacco authority to raise cigarette prices with 30 percent starting September 1. - Romanian carmaker ARO SA Campulung has increased price of its products by 25 percent. ROMANIA LIBERA - Economic situation is disastruous due to lack of a competitive programme of the government, paper quotes foreign economists as saying. - Government issued ordinance to exempt from custom duties import of 5,000 tonnes of newsprint. ZIUA - Romanian Oil Company has a $41 million debt. General: ADEVARUL - Recent interview of Democratic Convention (CDR) bloc leader Emil Constantinescu allegedly saying he would hand over power to ex-King Michael if elected president has triggered controversies in Romania's politics. Constantinescu denied the allegations while the ruling Party of Social Democracy (PDSR) accused him of undermining national security and violating the constitution. - Hungarian Democratic Union (UDMR) leaders said they would go ahead with their demands for autonomy and collective privileges despite the fact that the Romanian-Hungarian treaty due to be signed soon rules out both autonomy and collective rights on ethnic grounds. ROMANIA LIBERA - Government appointed Daniela Bartos as new Health Minister and Grigore Zanc as Culture Minister. ZIUA - NATO's Military Committee head Klaus Neumann to visit Romania to discuss the country's bid to join the western defence alliance as full member. He will meet President Ion Iliescu, Foreign Minister Teodor Melescanu and Defence Minister Gheorghe Tinca. CURIERUL NATIONAL - Melescanu told a news conference the Romania-Hungarian treaty was ready for signing and that he was confident parliaments in the two countries would ratify it. JURNALUL NATIONAL - Romania is one of the most active participants in the NATO's Partnership for Peace programme, NATO's supreme comander George Joulwan said in interview. (1$=3,157 lei) -- Bucharest Newsroom 40-1 3120264 2597 !GCAT !GVIO Orderly lines of Russian soldiers and a motley crew of Chechen rebels mingled on Saturday at a milestone ceremony to launch joint patrols of the regional capital Grozny, a key part of a new peace deal. The ceremony outside the village of Starye Atagi some 20 km (12 miles) south of Grozny was part of an agreement struck by Moscow's envoy Alexander Lebed and rebel military commander Aslan Maskhadov to end 20 months of civil war. Some 240 crack paramilitary police, known as "black berets", stood beside a similar number of colourfully dressed separatist rebels, many wearing green Moslem head-bands and carrying Kalashnikov automatic rifles and grenade launchers. Local residents who turned up for the ceremony at a field outside the village cheered the rebels, waving green flags and shouting "Allahu Akbar" (God is Greatest) "These are not soldiers of war but soldiers of peace standing here," Major-General Vyacheslav Ovchinnikov told the troops. "Let us put our grudges behind us." It was less then a week ago that Russia's top general in Chechnya threatened to launch an all-out bombardment of Grozny, seized by the rebels in a daring raid in early August. Hundreds of people died in two weeks of fighting, the worst since Moscow sent troops in late 1994 to quell Chechnya's independence bid, as Russian troops battled to win back the city. The breakthrough came on Thursday, when Lebed and Maskhadov struck a deal in the nearby village of Novye Atagi under which Russian troops and rebels agreed to pull back their forces in Grozny and form joint patrol groups to guard the city. Russian troops have already started pulling out from southern Chechnya, where separatist influence is especially strong. Maskhadov wished success for both sides in their new mission. "We are laying the foundation of peace," said the silver- headed rebel chief-of-staff who has masterminded many successful separatist operations against Russian forces in the war, adding: "We have had enough of war." When the speeches were over the Russian troops and Chechen irregulars joined together and split off into joint groups to patrol different parts of the devastated capital Grozny. In contrast with the optimism of their military leaders, troops on both sides, scarred by months of fierce fighting and the deaths of comrades and relatives, were more cautious. "I am not looking forward to do this but I got my orders and I have to carry them out," said Russian soldier Nikolai, 22, chewing gum and looking in the sun through his sunglasses. He did not give his last name. "Let's wait and see, maybe we become friends," his 24-year-old comrade Yevgeny Budarin said, doubtfully. "It's hard to believe this can work, but maybe it can." Chechen field commander Adam Sukhadzhiyev said the deal to jointly guard Grozny was only a temporary compromise measure. "I don't thing this will be for long and I don't like it at all," he said. "I will not agree to stand long with Russians at the same checkpoint". Lebed returned to Chechnya on Saturday to work out a wider political agreement which would end Moscow's biggest war since the 1980 invasion in Afghanistan. Yeltsin authorised him to strike a deal provided Chechnya remains part of the Russian Federation. It was not clear what kind of compromise Lebed could work out with the separatists, who insist on full independence from Moscow. 2598 !GCAT !GPOL !GVIO Russian peacemaker Alexander Lebed and Chechen rebel military commander Aslan Maskhadov met on Saturday to discuss the future political status of Chechnya and end a 20-month war in the breakaway province. They had to find a way between the separatists' demand for independence and Moscow's insistence that Chechnya remain part of Russia. Neither side gave any indication of what kind of deal was discussed in the village of Novye Atagi 20 km (12 miles) south of the regional capital Grozny. Maskhadov and Lebed, whom President Boris Yeltsin had ordered to restore peace in Chechnya, signed a military deal on Thursday under which besieged Russian troops started leaving Grozny held by rebels from August 6. The guerrilla fighters also agreed to withdraw most of their forces from Grozny and the warring sides have set up joint patrol groups to guard the city. Under the deal Russian troops have also started leaving southern parts of Chechnya where rebel influence is especially strong. Lebed and Maskhadov have said that the military deal was intended to create conditions for solving political aspects of the conflict in order to reach a lasting peace. Yeltsin, who spoke with Lebed on the phone late on Friday, authorised him to strike a political deal provided that Chechnya remains part of Russia. 2599 !GCAT !GPOL !GVOTE NATO on Saturday identified a list of twelve Bosnian municipalities where violence is possible on September 14 when the country goes to the polls in its first post-war elections. "There's a great deal of speculation about what election day will look like," NATO spokesman Lieutenant-Colonel Max Marriner said. "We look for a spirited but orderly election day because where there is disorder we're going to be ready and the local police and the election supervisors and thousands of other calming influences...are going to be ready." Eight of the hotspot communities lie within Bosnia's Moslem-Croat federation and the other four within its Serb republic, according to NATO's list. In each case the prospect of violence seems tied to the possible return of refugees and displaced persons to vote in communities from which they were driven or chose to flee during the 43-month Bosnian war. NATO drew up the list from places where tensions have been building or where violent incidents have taken place, using them as an indicator of potential election-day problems. Those municipalities identified by NATO as likely election day "hotspots" within the federation are Velika Kladusa, Jajce, Novi Travnik, Vitez, Busovaca, Fojnica, Kiseljak and Stolac. Refugees loyal to rebel Moslem leader Fikret Abdic trying to return to vote in Velika Kladusa, once an Abdic stronghold, could encounter animosity from loyalist Moslems in the area who fought for the Bosnian army against Abdic. The other towns identified by NATO on the federation side are contested by Moslems and Croats for whom the scars of their brutal ten-month war -- which was a sideshow to the main Moslem-Serb conflict in Bosnia -- have yet to heal. The Serb republic problem areas are Prijedor, Doboj, Brcko and Srebrenica. In these towns, which the Serbs cleansed of non-Serbs during the war, the return of Moslem refugees to vote could trigger violence. Marriner said NATO, U.N. and local police would be "stretched to the maximum on election day". For that reason specific routes are being identified for refugee movements, along which security could be beefed up. NATO views its role as providing a general "security envelope" within which other agencies would provide hands-on law enforcement. "The main responsibility for giving the citizens of Bosnia-Herzegovina the freedom to vote rests on the parties and their forces of law and order, the police," Marriner said. "Should election-day troubles make it past all those barriers (NATO), the force of last resort, will be poised to respond. In some circumstances we will act to contain and restrict the movement of crowds bent on violence when local police have not been able to." 2600 !GCAT !GVIO NATO announced on Saturday it was punishing the Bosnian army for two recent incidents in which the Moslem-led force showed a "complete disregard" for NATO rules on military ground and air movements. Lieutenant-Colonel Max Marriner, a NATO spokesman in Sarajevo, said NATO-led peace forces turned back a Bosnian army convoy on Thursday night which was travelling from Zenica to Bihac. The convoy consisted of eight buses carrying several hundred newly-trained soldiers. "This military movement was not authorised by (NATO) and as such constitutes a serious breach of compliance," Marriner told reporters. "Lieutenant-General Sir Michael Walker has decided to ban all (Bosnian Army) troop and equipment movement into the sensitive Bihac pocket until further notice." Walker commands all NATO-led ground forces in Bosnia, of which there are currently about 53,000. The Bosnian army had also broken NATO air traffic regulations in four incidents involving the transport of soldiers by helicopters on Friday, Marriner reported. Two of the flights were not supposed to carry any passengers and the other two carried more passengers than were authorised. "As a result General Walker has banned all (Bosnian army) helicopter flights until further notice," Marriner said. NATO penalised the Bosnian Serb army in recent days by destroying about 400 tonnes of contraband Serb munitions which were discovered in a school house in Margetici, near the eastern town of Sokolac. The Serbs protested vigorously over the Margetici incident and alleged NATO bias in favour of the Moslem-led Bosnian army. NATO denied any such bias but will have been happy to have the opportunity to demonstrate even-handedness with its punishment of the Bosnian army infractions announced on Saturday, diplomats said. NATO officials report that all three of the factional armies in Bosnia have from time to time violated the military requirements laid down in the Dayton peace agreement. Margetici was the most publicised of recent violations because of the huge amount of contraband discovered. But NATO figures indicate that the Bosnian army has been guilty of more violations than the other two factions on an incident-by-incident basis. NATO is still considering what to do about 16 military sites belatedly declared by the Bosnian Serb army on August 5. The sites should have been registered for inspection months earlier. Some contain radio transmitters and other non-lethal equipment, but among the 16 sites are at least 10 locations with munitions totalling 2,600 tonnes. Theoretically, all of the material could be confiscated and destroyed. But, having made its point at Margetici, NATO might direct the Serbs to move the munitions into approved storage sites. Such a move would probably trigger a complaint from the Bosnian army that NATO is biased in favour of the Serbs. 2601 !GCAT !GDIP !GPOL !GVOTE International election supervisors said on Saturday that the registration of Bosnian voter was being manipulated in Serb-held towns with refugees signing up to vote away from their pre-war homes. The warning was given extra weight by the signature of Swiss Foreign Minister Flavio Cotti, chairman of the Organisation for Security and Cooperation in Europe, which is overseeing Bosnia's first post-war elections on September 14. Such "serious infractions" threatened to distort the results of local elections, his statement said. Last year's Dayton peace accord says refugees should have the right to vote in their pre-war homes -- so that the outcome will not reflect ethnic cleansing during Bosnia's 3-1/2 year war. International officials say Serb authorities who want to consolidate their hold on the 49 per cent of Bosnia known as the Serb republic have coerced refugees into registering to vote from towns other than their pre-war place of residence. "The Chairman-in-Office is most deeply concerned about reports coming in from Sarajevo according to which serious infractions of elections procedures have taken place with the manipulation of refugee registration," the statement said. "Thousands of eligible voters appear to have registered for places like Brcko, Srebrenica, Zvornik, Doboj, Foca, etc. in which from today's perspective they would hardly ever intend to settle." By shifting tens of thousands of Serb votes from towns inside Bosnia's Moslem-Croat federation to places inside the republic the Serbs hope, through "ethnic engineering", to consolidate gains they made on the battlefield. Since virtually all non-Serbs were killed or expelled from the Serb republic during the 43-month Bosnian war, many strategic towns which were once majority Moslem are underpopulated. Diplomats say the Serb stratgey is to ensure that those towns, like Brcko and Srebrenica, remain under Serb control no matter how many Moslems vote either in person in their former towns or by absentee ballot. Cotti called on the OSCE's mission in Bosnia -- particularly its Provisional Election Commission which is the top election rule-making body -- "to take effective measures against this manipulation", the OSCE statement said. The commission met and considered this issue on Friday but made no decision. OSCE sources said one option under consideration was the postponement of elections in a small number of municipalities where the registration problems seem acute. The leading Moslem SDA party in Bosnia has called on the OSCE to prevent refugees form voting in places other than their pre-war homes and to postpone municipal elections entirely. SDA officials have said they would reconsider their participation in elections if their request is not honoured. 2602 !GCAT !GPOL !GVIO President Boris Yeltsin has backed the actions of his envoy to Chechnya Alexander Lebed after a puzzling delay, but appears to have tied the hands of the gruff general by insisting the territory remains part of Russia. The president's support, reversing strong reservations expressed on Thursday, should help untangle the twisted chain of command on who is responsible for what in the Caucasus region. But Yeltsin insisted after a late-night phone call with Lebed on Friday that Lebed must not let Chechnya leave the vast Russian Federation -- a key demand from the separatists throughout their 20-month-old struggle with Russian troops. Press spokesman Sergei Yastrzhmebsky said on Saturday that Yeltsin and Lebed had held "positive, detailed and constructive talks". "The president authorised Lebed to continue discussions and sign an agreement on the political regulation of the Chechen conflict defining the political status of the Chechen republic as an integral part of the Russian Federation," he said in a statement released by Yeltsin's office. Yeltsin appointed Lebed to represent him in Chechnya earlier this month and the retired general swept into action with a string of visits to talk to rebel military leaders. Last Thursday, the two sides agreed a ceasefire -- the latest in a series -- which both sides say has been holding to a large extent. But on the same day the president, in his first televised appearance since he was inaugurated for a second term in office on August 9, said he was not entirely satisfied with Lebed's performance in Chechnya, complaining he was taking too long to resolve the crisis. "These words cause bewilderment," Nezavisimaya Gazeta said on Saturday. "Any tactless remark, especially expressed by the state's top official, could have a psychologically unfavourable impact and can affect both the mood of the negotiators and the military, who have been deeply depressed for many months." Yastrzhembsky, appointed on August 12, said the interview was recorded on Thursday morning, before details emerged of the agreement Lebed was signing with the separatists. But the Kremlin statement did not explain why Yeltsin waited more than 24 hours before approving Lebed's actions, a delay which revived speculation that nobody was in charge of Russian policy in the breakaway region. Both Defence Ministry and Interior Ministry troops operate in the region, but cooperation between the two sides leaves much to be desired. Lebed, who has asked Yeltsin to sack Interior Minister Anatoly Kulikov for bungling the conflict, has no clear power base in Moscow. He said on Friday he was in command of the situation in Grozny, but the claim looked hollow without clear backing from the president. To make matters worse, Yeltsin, exhausted after the reelection campaign, disappeared for two days this week. Aides said he had travelled to northwestern Russia to decide whether to take a longer holiday there. But Russian and Western newspapers printed reports that the president, who had two heart attacks last year, was ill again. Aides denied all the reports and press spokesman Sergei Yastrzhembsky told Izvestia newspaper on Friday that the president was "lively and dynamic" after a two-day break. 2603 !GCAT !GPOL Albania's opposition Socialist Party began a two-day congress on Saturday to discuss major jettisoning its links with almost half a century of Stalinist dictatorship in the Balkan country. "The congress will approve new concepts that will turn the party into a Social-Democratic and electoral party, not a class and ideological one," the Socialist Zeri i Popullit daily said in an editorial. Jailed Socialist leader Fatos Nano made the first call for change in July, a month after the party's chief opponents, the conservative Democrats of President Sali Berisha, almost swept the board in a disputed general election. The Socialists, reformed heirs to the communists, pulled out of the poll saying it was a sham. Acting Socialist leader Servet Pellumbi has said he too will urge the party to scrap the ideas of Karl Marx at the congress. The pro-reform stance of some of the party leadership initially caused a storm and triggered the resignation last month of the party's Secretary-General Gramoz Ruci. More recently political commentators have reported a growing consensus, however, and a rift at the meeting looks increasingly unlikely. 2604 !GCAT !GPOL !GVIO Russia began withdrawing troops from the capital of breakaway Chechnya on Saturday in line with an agreement reached in talks between Russian military leaders and rebel commanders, Interfax news agency said. The agency said the interior ministry troop units would be redeployed in Grozny's suburbs. It did not say how many soldiers were being pulled out. Chechen rebels captured much of Grozny on August 6, trapping Russian soldiers in their checkpoints and inside the central complex of government buildings. Most fighting stopped on Friday after Russian peacemaker Alexander Lebed and top Chechen commanders agreed a ceasefire and promised to work towards a political solution. The truce took effect at noon (0800 GMT) on Friday and both sides say it has been broadly respected. Interfax said seven Russian servicemen had been wounded in Grozny in the past 24 hours. Hundreds of people died in the fighting earlier this month. Lebed, who won the rather belated backing of President Boris Yeltsin late on Friday, is to travel to Chechnya again at the weekend. 2605 !GCAT !GCRIM !GVIO At least five people were killed on Friday when demonstrators protesting against the Colombian government's drug crop eradication programme clashed with security forces for a second day, authorities and local news reports said. The clashes occurred in Caqueta, one of three southern provinces where tens of thousands of peasant growers of coca leaf, the raw material for cocaine, have protested since mid-July against government efforts to wipe out the staple crop. William Sanchez, mayor of Belen de los Andaquies, a small town southwest of Florencia, the provincial capital of Caqueta, said two demonstrators were killed there in early-morning clashes with security forces. Sanchez, who spoke by telephone with the Noticiero Nacional television programme, said the victims were protesters who had been gunned down by army troops. A third protester died of asphxia after being overcome by teargas, according to a report on Colombia's Noticiero de las Siete news programme. Two other protesters were killed in Florencia, which turned into a virtual war zone after rioting erupted when soldiers firing teargas canisters sought to break up a protest march through the centre of the city, hospital spokesmen told the Caracol radio network. A dusk-to-dawn curfew was imposed on the city at 7 p.m. (midnight GMT) after protesters, some them armed with Molotov cocktails, went on a day-long rampage, attacking government offices and banks and ransacking the home of Florencia Mayor Hector Orozco. Contact with Florencia, where the situation was described by Defence Minister Juan Carlos Esguerra as an open "rebellion" against the state, was still virtually impossible late on Friday, hours after demonstrators firebombed the offices of the local office of the state telephone company. Interior Minister Horacio Serpa, who has said that the anti-government protests were being orchestrated by leftist guerrillas, told the Caracol radio network that the government was "very concerned" by the violent turn they had taken. He fell short of announcing any specific measures the government might take to halt the protests, but said "anarchy leads only to misfortune." One demonstrator was shot dead and eight others seriously injured on Thursday when they tried to fight their way past riot police manning barricades across a bridge on the outskirts of Florencia. In all, at least a dozen protesters have now been killed in Caqueta and two neighbouring provinces since what the media has dubbed Colombia's "coca revolt" began last month. The government, under heavy pressure from Washington to destroy vast tracts of coca and opium poppy this year, has vowed to continue spraying them from the air with herbicide in a bid to stem the flow of illicit drugs onto U.S. streets. 2606 !C24 !CCAT !GCAT !GENV A Chilean commission on Saturday rejected an environmental study on the controversial Ralco Dam, saying it was incomplete and demanded details of plans to relocate Indians who will be forced off their land. Conama, Chile's equivalent to the U.S. Environmental Protection Agency, has been studying proposals since March by power company Endesa to build the dam that would span the upper Bio Bio valley in cool, wooded, southern Chile. "Conama considers the environment study for the Ralco hydro-electric plant insufficient, as it has a high level of breaches of reference terms and important ommissions in the evaluation of the project's impact in the zone," said executive director Vivianne Blanlot. Blanlot said Endesa has been asked to provide more information to allow authorities to assess the environmental impact of the project that will flood 8,600 acres (3,500 hectares). Although Conama's ruling was non-binding and Endesa could go ahead no matter what, this finding will focus opposition to the project and may give opponents of the dam ammunition in court. This was the second time this year Conama has ordered changes to studies prepared for large industrial plans and sets the stage for a bruising battle between Endesa, Chile's largest private company, and the growing environment movement. Empresa Nacional de Electricidad, or Endesa, plans to start building the 570 megawatt dam next year about 90 miles (150 km) southeast of the city of Concepcion and finish it in the year 2002. Endesa was already building another hydro-electric plant, Pangue, further downstream on the same river. Conama said Endesa's study did not include a complete description of the project, lacked an analysis of the impact it would have on the whole Bio Bio basin and failed to provide plans to resettle 500 Pehuenche Indians whose land will be flooded. "These are indigenous communities which maintain an economic and production system which will be damaged by the project," said Conama. The commission said it would allow the public and communities affected by the dam two more months to comment on the new information once it was handed over by the company. 2607 !GCAT !GPOL !GPRO Nicaraguan President Violeta Chamorro was due to fly to the United States on Saturday for a medical check-up to determine if surgery was needed on the lower part of her spinal column, the government said on Friday. Chamorro has complained of lower back pain since her trip to Taiwan in May, when the pain forced her to go to Taipei University Hospital for an examination. Chamorro, 66, suffers from osteoporosis, a disease that weakens the bones, and has repeatedly flown to Washington for treatment by her longtime doctor, Sam Wilson. 2608 !GCAT !GVIO Leftist guerrillas decapitated a 12-year-old boy in northwest Colombia as a group of schoolchildren watched in horror, authorities said on Friday. They said the grisly killing occurred on Wednesday afternoon during an attack by Revolutionary Armed Forces of Colombia (FARC) rebels on Apartado, a town in the notoriously violent banana-growing region of Uraba. Guerrillas attacked the town in an apparent bid to free eight comrades being interrogated in the local prosecutor's office, army officials said. They said two guerrillas grabbed the boy as a human shield but lopped off his head with a machete without provocation. "In a matter of seconds the two men cut the boy's head off and lifted it up in the air," Apartado Mayor Gloria Cuartas, an eyewitness to the crime, said in a television interview. She said she was with a group of schoolchildren when the boy was killed and that many of the youngsters saw what happened before she rushed them into a nearby building. "It show the degree of madness we're living under in Uraba," Cuartas said. Guerrillas and right-wing paramilitary groups have fighting for years for control over lucrative drug and contraband routes through the region, in northwest Antioquia province near Colombia's border with Panama. Another 12-year-old boy was killed in the Segovia region of Antioquia on Thursday. Police said the boy was felled by a shotgun blast to head while trying to defend his older sister from two rapists. 2609 !GCAT !GDIP New Zealand Foreign Minister Don McKinnon said on Saturday he was disappointed with Nigeria's response to a proposed Commonwealth visit to discuss the country's suspension from the group. Commonwealth ministers cancelled the planned trip after disagreeing on terms on the visit set by the African country's military rulers. Ministers had planned to visit the Nigerian capital Abuja on August 29-30, but only if they could talk to private groups and individuals in addition to government officials. Foreign ministers of the British Commonwealth, which suspended Nigeria because of concerns about democracy and alleged human rights abuses, will meet in London on Wednesday to discuss what to do, he told a news conference. McKinnon said in a statement that Nigeria had to decide whether it wanted to implement the standards of good government necessary for it to resume membership. Commonwealth heads meeting in New Zealand last year suspended Africa's most populous nation after author Ken Saro- Wiwa and eight other minority rights activists were executed for murder. The group criticised Nigeria's plan to restore democracy by 1998 as inadequate. Nigeria has consistently refused to allow a Commonwealth Ministerial Action Group (CMAG) fact-finding mission to investigate alleged human rights abuses. But this month it invited the Commonwealth to visit the capital Abuja for the two days to continue discussions begun in London in June. McKinnon said he was surprised the team would not have been allowed to stay longer and that it was unacceptable for the delegation not to be allowed to meet Nigerians outside the military administration. "I was encouraged by recent statements from the Nigerians which said they were making considerable progress towards implementing a democratisation programme... "CMAG ministers wanted to see and hear first-hand about this process," McKinnon said. He hoped the reaction was a temporary aberration. Diplomats said any team visiting Nigeria would expect to be allowed to meet anyone they wanted to, including political detainees and pressure groups. When the two sides met for the first time in London, the Commonwealth ministers decided not to impose further sanctions on Nigeria pending more talks, a decision which angered pro-democracy activists. Nigeria's last transition to democracy was aborted at the final minute in 1993, when a previous military government annulled elections, plunging the country into political crisis. Among dozens of political detainees in Nigeria is the presumed winner of the elections, millionaire businessman Moshood Abiola, who declared himself president in 1994 based on the results. CMAG comprises New Zealand, Malaysia, Zimbabwe, Jamaica, Ghana, Britain, South Africa and Canada. 2610 !E51 !ECAT !GCAT !GDIP Australia's conservative government has criticised China's increasingly assertive foreign policy and territorial claims, warning Beijing could endanger much-needed foreign investment. Australian Defence Minister Ian McLachlan, in an interview published on Saturday in the national daily The Australian, said China had become "a bit jumpy" since the end of the Cold war. McLachlan said Beijing's strident stance over territorial claims in the South China Sea and Taiwan raised concerns about the regional strategic outlook. "There is no doubt that China has felt much more assertive, has been much more assertive, since the end of the Cold War," The Australian quoted McLachlan as saying. "And the best example, of course, is Taiwan. "So it is a bit disappointing that the Chinese ... are making lots of noises that they hadn't really made hitherto." McLachlan said China's growing assertiveness risked scaring off foreign investment. "I would have thought that ... the danger for them is that investment will start to drop off if people start to worry about it," he said. "You know, all these little claims, the boundaries claims, the Taiwan thing, can't encourage people to invest in China." McLachlan said China had taken a tough line with Australia over several issues. "You know, we have had some aggression from (Canberra-based) Chinese diplomats," he said. His comments came as Australian Foreign Minister Alexander Downer was in Beijing, trying to smoothe relations after recent disagreements. Downer, who is on a four-day visit, on Friday announced an agreement with China to expand the two countries' security dialogue. "What I would like to see happen is us holding, on an annual basis, senior officials talks about regional security issues," Downer said. McLachlan told The Australian his criticisms would not sway Australia from its plan to boost defence links with China. Asked if Canberra would continue with the plan, McLachlan said: "Yes, absolutely. I talk to (armed forces chief) John Baker about this a lot." Relations between Canberra and Beijing have chilled recently over a range of diplomatic and security issues, including a plan to sell Australian uranium to Taiwan. China has also protested against the axing of an Australian soft loan aid scheme, plans for an Australian minister to visit Taiwan, a new security pact between Canberra and Washington and the planned visit to Australia next month by exiled Tibetan spiritual leader the Dalai Lama. Downer is due to meet the Nobel Peace Prize winner in Melbourne and Liberal-National Prime Minister John Howard is considering a meeting, arousing Beijing's ire. 2611 !GCAT !GCRIM !GDIP Allegations that New Zealand diplomats put pressure on a judge in Hong Kong are "wrong", a spokesperson for Foreign Affairs Minister Don McKinnon said on Saturday. The minister was responding to reports in the British colony that New Zealand government officials and two judges interfered in a court case involving a New Zealander. Immigration consultant Aaron Nattrass, 34, has denied 35 fraud charges, including obtaining more than HK$500,000 (NZ$94,750) by making false promises to Hong Kong residents of employment and residency in New Zealand. The judge in the case, who is also a New Zealander, is alleged to have complained to two senior Hong Kong government lawyers that two fellow judges tried to influence him in the fraud case against Nattrass. Judge Brian Caird is also said to have told the lawyers that the New Zealand Immigration Service appeared to be using the two judges to influence him and that the New Zealand Consulate had said the defendant was guilty. However, both Judge Caird and New Zealand officials have denied the allegations. "Allegations the New Zealand government has interfered in the case are wrong," McKinnon said in a statement. "So far as the New Zealand government is concerned whether or not there was wrong doing is a matter for the Hong Kong judicial authorities. No doubt if the allegations made demonstrate the need for a judicial inquiry, the Hong Kong authorities will hold one." On Friday, the colony's chief justice said he was gravely concerned about the allegations and that the matter was being "fully and carefully investigated". New Zealand Immigration Minister Roger Maxwell said late on Friday he would be "staggered if there was any substance to the allegations". The scandal erupted after signed statements by the two prosecution lawyers, Ian McWalters and John Reading, were leaked to the press. In their statements, they said they had been approached separately at their homes by Judge Caird, who is presiding in the case against Nattrass, originally from Auckland. Reading said in his statement that Judge Caird said he had been approached by one of the judges who said the New Zealand Consulate had told him Nattrass was guilty. "It was obvious that the judge (Caird) was very upset, and he commented that this was the first time in his judicial career that political pressure had been brought to bear on him," Reading said in his statement. Judge Caird denied he had been pressured when he was contracted by the New Zealand Herald in Hong Kong late on Friday. He repeated a statement he made in court on Friday, saying: "I want to state there has been no pressure, political or otherwise, exerted on me other than the length and complexity of the hearing." He said he did not "consider any statement in the nature of gossip", and emphasised that Nattrass would receive a fair hearing. The Acting New Zealand Consul-General in Hong Kong, Kevin Kay, told the Herald the allegations were untrue. "There has been no attempt by New Zealand authorities to influence the judge in the case," he said. 2612 !GCAT !GDIP The mass circulation China Times newspaper said on Saturday that Taiwan Vice-President Lien Chan for the first time had confirmed he met Ukrainan President Leonid Kuchma in a secretive Kiev visit this week. "Vice-President and Premier Lien Chan at last night's dinner with diplomats confirmed for the first time that he met Ukrainian President Kuchma," the newspaper reported. Lien, who returned to Taiwan late on Thursday after a three-day secretive Kiev mission, has said he spoke with people "of all levels" in Ukraine that enfuriated China but declined to say if he met Ukraine's president. "I met the people I wanted to meet and discussed the things I wanted to discuss," Lien said on Thursday. "In Ukraine, I met people from all levels, specific people, and had a full exchange of views. But I cannot identify who I met by name. That would not live up to the agreement I made before visiting." The newspaper said the Lien-Kuchma meeting took place in Kiev. It gave no further details. Ukraine, bearing the brunt of China's anger, flatly denied that Lien and Kuchma met, although Foreign Minister Hennady Udovenko told Reuters he found Beijing's furious reaction to Lien's visit to be "out of proportion". "It wasn't even a visit but a trip, a private journey," Udovenko said of Lien's stay. China, which regards Taiwan as a renegade province, delivered a note of protest to Ukraine's ambassador in Beijing and cancelled a visit by a high-level delegation. Beijing says Taiwan, as a Chinese province, is not entitled to foreign ties and has rebuked even allies whom it sees as giving political or diplomatic quarter to the island's leaders. Lien surfaced in Kiev on Tuesday, two days after vanishing in New York following a state visit to the Dominican Republic, one of just 30 countries in the world which recognize the island instead of China. President Lee Teng-hui urged China on Friday to face the reality of politically estranged Taiwan and sit down to talk, and said his island would not halt its drive for broader international ties. 2613 !GCAT !GPOL Burma's embattled dissident leader Aung San Suu Kyi on Saturday accused the military government of intensifying its oppression of the democracy movement. Suu Kyi, in a weekend speech to crowds outside her Rangoon home, said democracy supporters were being arrested and intimidated. "The authorities are stepping up oppression against the supporters of our democratic movement," she said. "Our people are arrested and intimidated." Suu Kyi did not refer directly to the recent arrest and sentencing to stiff prison terms of some 30 NLD supporters, including one of her aides, but said the harsher oppression showed that the ruling military was not confident of its position. "If the authorities are confident of their own position.... they will gain the support of the people without having to arrest them, put them in prison, threaten them," she said. Earlier on Saturday, NLD sources in Rangoon said reports of the imprisoning of more NLD supporters were filtering out to colleagues. There were unconfirmed reports from Burma's second city, Mandalay, that 19 more NLD supporters were sentenced to prison terms of up to 10 years for allegedly plotting unrest, an NLD source said. Burma never announces sentences imposed on dissidents but last Wednesday said 19 people, including at least two NLD members, had been arrested for plotting unrest. Several days earlier 11 democracy activists, including Suu Kyi's personal assistant Win Htein, were sentenced to seven years' jail for violating security laws, NLD sources said. Suu Kyi was released from six years house arrest in July last year and has since been pressing the military to open talks on political reform. The government has ignored her calls and in May launched a sweeping crackdown against the NLD and stepped up a war of words with Suu Kyi, accusing her of being a lackey of colonialists and a traitor. Burma's army commander, in an obvious reference to Suu Kyi and Western government which support her, urged his forces to help eliminate threats to the nation from both inside and outside the country. General Maung Aye, also a leading member of the ruling miltary body, said in a speech on Friday that powerful nations and "lackeys" inside Burma were trying to dominate the country and hinder its development. The millitary has ruled Burma since a 1962 coup. The current governing generals rose to prominence in September 1988 when troops crushed a pro-democracy uprising and a new ruling military council was set up. Suu Kyi, who won the 1991 Nobel Peace Prize for her efforts to restore democracy, is the daughter of General Aung San, the country's pre-independence leader and the founder of the modern Burmese army. 2614 !GCAT !GCRIM !GPOL !GVOTE South Korean prosecutors will begin an investigation next week into alleged general election voting irregularities, officials said on Saturday. The watchdog Central Election Management Commission said on Friday it had reported a list of 351 people in connection with suspected legal violations during general elections in April. "We will start a probe next week as the commission filed complaints involving hundreds of people," said an official at a Seoul prosecutor's office. He said the deadline for indictment was October 11. The commission said 20 lawmakers, 13 from the ruling New Korea Party, were included in the list and could lose their seats if found guilty. In theory, if NKP legislators were found guilty the number of seats held by the ruling party could fall to 139 from the current 152 in the 299-seat National Assembly. But it would retain a majority, if not an absolute majority, as the major opposition party now holds 79 seats. President Kim Young-sam has said he will not tolerate any election violations. His anti-corruption drive has led to the sacking of hundreds of civil servants and put two former presidents, Chun Doo Hwan and Roh Tae-woo, on trial for amassing huge slush funds. 2615 !GCAT !GDIS !GHEA Ulan Bator believes a deadly cholera outbreak that has infected hundreds of Mongolians reached the isolated north Asian nation from China and has asked Beijing to find the source, official media said on Saturday. At least 10 people have been killed by cholera and 134 infected since the disease was first discovered in northern Khoetol county three weeks ago, health workers say. The official Ardiin Erkh newspaper said Mongolian health minister L. Zorig had asked Chinese officials on Thursday to help find the origin of food imported from China that was found to be contaminated by cholera bacteria. "Mongolian health organisations have discovered the infection was transmitted by foodstuffs that were imported by Chinese citizens," the newspaper quoted government sources as saying. It gave no details of what kind of food was to blame. The newspaper referred only to cholera in northern Khoetol county, but officials said a separate outbreak near the Chinese border also came from Mongolia's huge southern neighbour. "The only thing in common between these two outbreaks is that both trace back to China," said one senior official, who declined to be identified, earlier this week. Mongolian officials and Chinese diplomats were unavailable to comment on Saturday. None of the 47 Chinese living in Khoetol have been reported sick. The first appearence of the cholera outbreak was traced to a military unit in the county. More than 2,300 people across Mongolia remained in quarantine and at least four people infected with the disease were in critical condition, health officials said. In the capital Ulan Bator, 17 people were reported sick and 14 more suspected to have been infected, they said. Two major cities of Darkhan and Erdenet, the whole of Selenge province and parts of Central province remained in official isolation for the third week running. The southern border town of Zamiin Uud and the East Gobi provincial centre of Sainshand were quarantined last weekend, after Mongolians returning from China became ill with cholera. Officials say attempts to isolate high risk areas have been difficult in the largely pastoral nation, where mounted nomads roam uncontrolled across thousands of kilometres (miles) of grasslands and forest. 2616 !GCAT !GPOL !GVIO Burma's army commander urged his forces to help eliminate threats to the nation from both inside and outside the country as democracy activists said more of their colleagues had been jailed. General Maung Aye, also a leading member of the ruling miltary body, said powerful nations and "lackeys" inside Burma were trying to dominate the country and hinder its development. The general, whom many political analysts tip as Burma's next leader, did not identify the countries or their "puppets" inside Burma but he was apparently refering to the United States and pro-democracy leader Aung San Suu Kyi. "They do not wish to see small countries...striving for mulitsectoral development and so attempt to hinder improvements on the political, economic and social fronts," he said in a Friday speech to trainee army officers, excerpts of which were carried in official newspapers on Saturday. "These (internal) lackeys, who can find no support at home, rely more on external elements, destroying political, economic and social foundations already laid," he said. Burma's ruling generals frequently refer to the 1991 Nobel Peace Prize laureate, Suu Kyi, as a "lackey" of "colonialists" such as the United States. Maung Aye said the army had to "join hands with the people to eliminate internal and external threats". Maung Aye's warning came as reports of the imprisoning of more supporters of Aung San Suu Kyi's National League for Democracy (NLD) dissidents were filtering out to colleagues. An NLD source said on Saturday that there were unconfirmed reports from Burma's second city, Mandalay, that 19 more NLD supporters were sentenced to prison terms of up to 10 years for allegedly plotting unrest. Burma never announces sentences imposed on dissidents but last Wednesday said 19 people, including at least two NLD members, had been arrested for plotting unrest. State media said the 19 had made contacts with NLD members living in exile in India and distributed anti-government leaflets and made plans to open a secret office in the town of Monywa, state television reported. Several days earlier 11 democracy activists, including Suu Kyi's personal assistant Win Htein, were sentenced to seven years' jail for violating security laws, NLD sources said. Suu Kyi was released from six years house arrest in July last year and has since been pressing the military to open talks on political reform. The government has ignored her calls and in May launched a sweeping crackdown against the NLD. 2617 !GCAT !GDIP King Birendra of Nepal has told China his nation will not become the tool of people who want Tibetan independence from Beijing, the official China Daily newspaper said on Saturday. King Birendra, in Tibet at the start of a one-week unofficial visit to China, said the Nepalese government had "maintained a sharp vigilance against such intentions", the newspaper said. Nepal shares a long mountain border with the restive Himalayan region, where opposition to Beijing's four-decade rule is widespread. Chinese official media has often accused foreign forces, notably the United States, of seeking to support Tibetan independence activists. King Birenda told Gyaicain Norbu, chairman of the Tibetan government, that Nepal would not "become a tool for others to split Tibet", the newspaper said. Gyaicain told the royal visitor increased cooperation between Nepal and Tibet was possible in the fields of trade, tourism, communications and sports, it said. It gave no details. 2618 !GCAT !GCRIM A senior Macau police officer and trained bomb expert has been arrested in connection with a wave of bomb explosions in the territory in recent months, Macau's Judicial Police said on Saturday. The officer, in his thirties, was arrested after several months of undercover investigations early Friday at his home where plenty of materials needed for the production of home-made bombs were found, police sources said. Police declined to disclose his name, but confirmed that they had seized bomb materials. The officer, who was specially trained in Portugal in explosives, was expected to appear in a Macau district court on Saturday or Sunday, sources said. Macau has been hit by twelve bomb attacks - described earlier by police as a spate of favourite warning signals in financial disputes - since December 1995 which injured a total of eight people. The last, on August 9, blew up outside a karaoke bar and former Thai gigolo club, shattering nearby windows and damaging six parked cars. Earlier ones exploded outside restaurants and a gymnasium and inside the toilet of one of Macau's many casinos. 2619 !GCAT !GVIO The International Committee of the Red Cross (ICRC) has met 11 Indonesian political activists being held on subversion charges over last month's riots, the official Antara news agency said on Saturday. A spokesman for the Attorney-General's department, which is holding the activists, including independent labour leader Muchtar Pakpahan, said the visit was part of the ICRC's agenda to meet political detainees across the world. "They wanted to know how the Attorney-General's Office has been treating the detainees," spokesman Pontas Pasaribu was quoted as saying. Besides Pakpahan, those visited were all members of the small left-wing People's Democratic Party (PRD) which the government has blamed for being behind the July 27 riots, regarded as the worst in more than 20 years. Four died in the disturbances. Subversion in Indonesia carries a maximum penalty of death. A spokesperson from ICRC delegation in Jakarta confirmed that the visit took place on Friday but said the Geneva-based body would not release any details. "We can confirm we have visited all these people detained by the Attorney-General (and) being interrogated for subversion," the spokesperson said on Saturday. "We had limited access to them and we have been able made an our assessment," they said. Antara reported the team of three ICRC delegates, including a medical doctor, spent about 30 minutes with the detainees, including PRD leader Budiman Sudjatmiko. "I cannot talk about their condition but the visit is part of (a) confidential way to improve the situation if it needs to be improved. This is part of the broad cooperation and understanding we have with this government regarding political detention," the spokesperson said. The Jakarta Post newspaper reported on Saturday that the PRD detainees, most of whom were arrested two weeks ago, were now able to meet their families and lawyers three times a week. Under Indonesia's 1962 subversion law, detainees may be held incommunicado for up to 200 days. The paper quoted Pasaribu as saying Pakpahan, arrested on July 30, had been given an acoustic guitar for his birthday, recently celebrated in custody, to help him occupy his time. 2620 !GCAT !GDIP !GPOL Beijing is pushing for Hong Kong's first chief executive after the 1997 handover to be selected through consensus rather than a vote by a 400-member panel, a newspaper said on Saturday. An election would be divisive and run counter to Beijing's aim of maintaining stability during the handover, the Hong Kong Standard reported, quoting a well-placed Chinese source. The British colony reverts to China at midnight on June 30, 1997, and Hong Kong's first, post-handover chief executive is due to be selected by November this year. Nominations for the 400-member Selection Committee, responsible for choosing both the chief executive and provisional legislature to replace the current elected chamber, began on August 15 and will run for a month. The committee will be formed in October. An election by the Selection Committee would involve campaigning, lobbying and direct confrontation between candidates, jeopardising China's hopes for a smooth transition, the newspaper quoted the source as saying. "If election is the closen method, there will be strong lobbying and competition will be intensified," the source said. "No matter who wins, that person would have got in without the support of a portion of members," the source said. Lau Siu-kai, a member of a China-handpicked body handling handover matters, was also quoted as saying that Beijing hoped to have a chief executive who commanded the full support of all 400 members and the public. "There is explicit opposition to election from mainland members and some local business and professional members of the committee," Lau said. "They think election of the chief executive will only show people the successful candidate does not have the support of all 400 selection committee members," he said. "Just imagine the embarrassment if the sole candidate got the support of only the barest majority," he said. The South China Morning Post said Cathay Pacific Airways chairman Peter Sutch and Tung Chee-chen, younger brother of shipping magnate would seek entry into the Selection Committee. Tung Chee-hwa has been widely tipped as Beijing's favoured candidate for the top Hong Kong post, The younger Tung, managing director of Orient Overseas Container Line Ltd, had pledged support in April for his brother if he decided to stand for the post, the newspaper said. Both men were not immediately available for comment. 2621 !GCAT !GCRIM !GPOL An Indonesian minister and party rival being sued by ousted Indonesian Democratic Party (PDI) leader Megawati Sukarnoputri are said to be ready to seek an out-of-court settlement, newspaper reports said on Saturday. But the comments by Interior Minister Yogie Memet and the leader of the government-backed PDI opposition party, Surjadi, that they were open to a settlement came as Megawati said she wanted her law suit to continue so she could receive justice. Central Jakarta District Court chief judge I Gde Ketut Suarta adjourned Megawati's multi-million dollar case against the government, military and party rivals on Thursday to allow both sides to discuss an out-of-court settlement. The Jakarta Post newspaper reported on Saturday that Surjadi said he was ready for peace. "In fact, even before this issue reached the court, we'd already forwarded the possibility of a settlement," Surjadi told reporters. He said the dispute with Megawati was an internal matter and should be settled within the party. "The offer (for such a settlement) may be good," Memet was quoted as saying by the newspaper. Surjadi, a deputy parliament speaker, ousted Megawati from leadership at a government-funded congress in June. Megawati has sued Memet, Armed Forces Chief General Fiesal Tanjung and Indonesian police chief Lieutenant-General Dibyo Widodo for supporting the rebel congress. Surjadi and some of his supporters are also defendants in the case which is asking the court declare the congress illegal and pay 51 trillion rupiah ($22 billion) in damages. Megawati, however, said on Friday that she was still keen to pursue the case. "I took a legal route because indeed I wanted to show what was done to the PDI, including me, was a thing that challenged or opposed the law," Megawati, the eldest daugther of Indonesia's founding president Sukarno, told Reuters. The Merdeka newspaper reported on Saturday that a number of lawyers from Megawati's legal team, including its head lawyer R.O. Tambunan, had met in a restaurant on Friday with lawyers from the Attorney-General's office. Tambunan was not available to confirm the report. Megawati has been at the centre of a political storm since her removal from the PDI's top post, which led to some of the most severe protests in President Suharto's three decades of rule. Riots broke out in Jakarta on July 27 after police cleared the PDI headquarters of her supporters. At least four people died and scores of buildings and vehicles were set on fire during the violence. 2622 !C12 !CCAT !GCAT !GCRIM Japanese police on Saturday arrested a suspected blackmailer who allegedly threatened to contaminate food in a major shopping outlet with the bacteria responsible for the country's present food poisoning epidemic. A police spokesman told Reuters the 51-year-old man demanded 120 million yen ($1.2 million) from the Seven-Eleven Japan Co. convenience store not to go ahead with his plot. The spokesman said the man mailed a threat to the chain last Monday and followed it up with 20 threatening telephone calls. He was arrested in a western Tokyo suburb on Saturday morning when he went to a bus depot where police had lured him with a promise to pay the money. The man told them he needed the money because he had debts of 30 million yen ($3 million). The spokesman did not say if the man had in his possession the O-157 E. coli bacteria responsible for the food poisoning outbreak over the past three months which has killed 11 people and made nearly 10,000 ill. A company spokesman also had no details of the man's plans. The bacteria causes severe vomiting, diarrhoea and dehydration. Health authorities have so far failed to establish the carrier of the germ, which is easily transmitted from person to person. On Friday, the eleventh victim died in western Japan's Nara prefecture, dashing hopes that the epidemic was easing. The city of Sakai, near Osaka in western Japan, has been hit hardest by the epidemic, with nearly 6,500, mostly school children, affected. Health authorities believe school lunches are the source of the food poisoning in Sakai. The outbreak has prompted authorities to tighten sanitary standards at slaughterhouses and meatpacking plants and sparked calls for an overhaul of the nation's school lunch programme. News of the woman's death came as Japanese media reported health officials were preparing to declare next month that the worst of the epidemic was over as the number of new infections had decreased. "There are no new cases of infection and I hope we can make public a bright outlook," Health Minister Naoto Kan said earlier in the week. 2623 !GCAT !GDIP !GVIO Jordan has told two Iraqi diplomats and an administrator to leave the country which eight days ago was shaken by the worst unrest in seven years, official sources said on Saturday. The sources named the three as Adel Ibrahim, the embassy's press attache, first secretary Khalid Rashid Misleh, and Abbas Ali Hassan, an administrator. "Mr Ibrahim's end of term was coming up anyway and the government asked Iraq to expedite that, and Mr Misleh was given three days to leave as of today (Saturday)," said one source. "And the interior ministry on Saturday refused to renew the residence permit of Mr Hassan, forcing him to leave." The three, the sources said, were engaged in duties incompatible with their diplomatic status, normally a diplomatic term for spying. The unrest erupted last weekend after the government doubled bread prices under reforms agreed with the International Monetary Fund. King Hussein and Prime Minister Abdul-Karim al-Kabariti have blamed the trouble on Iraq and a local-pro Baghdad party. Information Minister Marwan Muasher, talking to reporters, confirmed reports that the Jordanian foreign ministry summoned Iraq's charges d'affaire in Amman on Saturday and gave him a "verbal message on the situation of three members of the Iraqi embassy in Jordan." He declined further comment. Muasher said Jordan had evidence of official Iraqi involvement in the unrest and that detained pro-Iraqi activists would be sent to court soon. "We have evidence of the involvement of some official parties in Iraq in the latest incidents...," Muasher told reporters after a regular council of ministers meeting, attended for a while by King Hussein. He said those detained for involvement, including leaders and members of the Jordanian Arab Socialist Baath Party (JASBP), a pro-Baghdad organisation suspected of instigating unrest, would be sent to court. The JASBP, which has one deputy in the 80-seat lower house of parliament, has denied involvement in unrest which it blamed on government policies and rising economic hardship. Government attempts to link the rioting to foreign influence has been treated with scepticism by many politicians and those in the streets who blame the protests on economic hardship and rising poverty and unemployment. King Hussein has been calling for change in Baghdad since top Iraqi defections to Jordan a year ago. Kabariti has been the point man in the king's confrontation with Iraq, his main Arab ally before the 1990-91 Gulf crisis. Officials have hinted the government might dissolve the JASBP for violating Jordanian laws and ask Iraq to reduce the number of Iraqi diplomats in Jordan, said to be over 20. Three Jordanian diplomats man Amman's mission in Baghdad. Meanwhile, the army withdrew its heavy presence from Karak and lifted a curfew on its residents with the return of order, residents and officials said. Officials said a tight curfew imposed since August 17 was lifted at five a.m. (0200 GMT) and authorities began releasing scores of detainees who demonstraterd but did not take part in damaging government buildings or inciting unrest. 2624 !GCAT !GDIP !GVIO Jordan on Saturday stepped up its campaign of accusations that Iraq was involved in the kingdom's worst unrest in seven years, citing evidence gathered from pro-Baghdad detainees. The new allegations were made a day after an official source said Jordan had asked an Iraqi diplomat to leave because he was carrying out duties "incompatible with diplomatic norms", implying he was accused of spying. Jordan's mass-circulation state-controlled newspapers ran headlines implicating Iraq in the unrest, which erupted last weekend after the government doubled bread prices under radical economic reforms agreed with the International Monetary Fund. King Hussein and Prime Minister Abdul-Karim al-Kabariti have blamed the trouble on Iraq and a local-pro Baghdad party. But government attempts to link the rioting to foreign influence has been treated with derision by many politicians and those in the streets who blame the protests on severe economic hardships and rising poverty and unemployment. "We have written confessions from detainees that point to the involvement of official Iraqi parties in instigating the unrest," a senior government official, who requested anonymity, told Reuters on Saturday. Security forces have arrested scores of leaders and members of the Jordanian Arab Socialist Baath Party (JASBP) since trouble flared in the party's traditional bastion in the southern town of Karak eight days ago and spread to nearby towns before reaching an area in downtown Amman. The party, which has one deputy in the 80-seat parliament and maintains strong links with Iraq's ruling Baath party of President Saddam Hussein, has denied involvement in the unrest. "We have established facts that orders were issued by Iraq's Baath party to use the bread issue to stir trouble to hit back at the king and the government for their anti-Iraq policies," the Jordanian official said. An investigation was under way and those behind the unrest would be exposed once it was over, he said. "We will not sit on it or cover up the results." The king has been calling for change in Baghdad since top Iraqi defections to Jordan a year ago. Kabariti has been the point man in the king's confrontation with Iraq, his main Arab ally before the 1990-91 Gulf crisis. The official also confirmed reports that Amman banned Khaled Rashid Misleh from coming to Jordan to take up his post as the new first secretary at the Iraqi embassy in Amman "because we found out he was an Iraqi intelligence officer". Officials have hinted the government might dissolve the JASBP for violating Jordanian laws and ask Iraq to reduce the number of Iraqi diplomats in Jordan, said to be over 20. Three Jordanian diplomats man Amman's mission in Baghdad. Meanwhile, the army withdrew its heavy presence from Karak and lifted a curfew on its residents with the return of order, residents and officials said. Armoured vehicles that had ringed Karak and deployed along most of the old city's inner roads were pulled out at dawn, hours after the main Friday prayers, the starting point of last week's troubles, passed peacefully. Officials said a tight curfew imposed since August 17 was lifted at five a.m. (0200 GMT) and authorities began releasing scores of detainees who demonstraterd but did not take part in damaging government buildings or inciting unrest. "Those who were involved in torching buildings and in instigating trouble will be sent to court," said one official. 2625 !GCAT !GPOL !GVOTE North Lebanon votes on Sunday in the second stage of month-long elections that appear likely to return an overwhelmingly pro-government parliament. About 580,000 voters will choose 28 deputies for the 128-member house in what newspapers described as the most confusing round of the five-stage election. Five lists of candidates, formed on the basis of local alliances and personal rivalries, are competing. None offers a clear choice between the government and the opposition. Government supporters won 32 of 35 seats on August 18 in the voting a week ago in the Christian heartland of Mount Lebanon, arousing opposition protests of massive intimidation and fraud. The government cites security reasons for holding the election by region, but opposition candidates say it makes it easier for the authorities to control the voting and the results. The elections in north Lebanon and its chief city Tripoli will be followed by polls in Beirut, south Lebanon and the eastern Bekaa valley on the following three Sundays. Several supporters of billionaire Prime Minister Rafik al-Hariri, who runs in Beirut next week, are standing on different tickets in north Lebanon as he seeks to build a national political base. Most of the candidates are friends of Syria, which has a powerful say in the affairs of Lebanon where it has an estimated 35,000 troops. Even those who oppose the government are not against its pro-Syrian stance, unlike several nationalist Christians who stood last Sunday in Mount Lebanon on pledges to stop the whittling away of Lebanese sovereignty. The most prominent candidates are former prime minister Omar Karami, a Sunni Moslem, and Suleiman Franjieh, a Maronite Christian and former minister, both of whom are pro-Syrian rivals of Hariri. But even they have some Hariri supporters on their list, including Information Minister Farid Makari, one of four ministers who are up for election. Several defeated opposition candidates in Mount Lebanon say they will lodge appeals with the Constitutional Council for cancellation of the results and a new vote in their districts. 2626 !GCAT !GDIP Jordan's ties with Iraq plunged into a new low after it accused Baghdad of exploiting economic hardship to foment its most serious civil disturbances for years and ordered out two Iraqi diplomats and an administrator. A government minister said Iraqi parties were involved in sparking riots which shook the southern town of Karak, a traditional bastion of pro-Iraqi ideology, nine days ago and spread to nearby towns and a poor district of Amman. The violence followed a government decision to double bread prices under radical economic reforms agreed with the International Monetary Fund (IMF). Official sources identified the three Iraqis who must leave as Adel Ibrahim, the Iraqi embassy's press attache, first secretary Khalid Rashid Misleh and Abbas Ali Hassan, an administrator. "Mr Ibrahim's end of term was coming up anyway and the government asked Iraq to expedite that, and Mr Misleh was given three days to leave as of Saturday," one source said. "And the Interior Ministry refused to renew the residence permit of Mr Hassan, forcing him to leave." The sources said all three Iraqis were engaged in duties incompatible with their diplomatic status, a phrase normally used in diplomatic circles for spying. Information Minister Marwan Muasher confirmed that the Foreign Ministry summoned Iraq's charges d'affaire on Saturday and gave him a "verbal message on the situation of three members of the Iraqi embassy in Jordan." He did not elaborate. But Muasher, speaking after a late night cabinet meeting, said Jordan had proof of official Iraqi involvement in the riots and would put detained pro-Iraqi activists on trial soon. "We have evidence of the involvement of some official parties in Iraq in the latest incidents," he told reporters. Iraqi state-run radio said last week Baghdad had no role in the unrest and the Jordanian Arab Socialist Baath Party, a pro-Iraqi organisation with one deputy in the 80-seat lower house of parliament, has denied that it was involved. Government attempts to blame the riots on foreign forces have been treated with scepticism by many politicians and those in the streets who say the protests were sparked by rising poverty and umeployment. King Hussein, once Iraqi President Saddam Hussein's main Arab ally, has been calling for changes in Baghdad since two of Saddam's sons-in-law defected to Jordan a year ago. The Jordanian army withdrew its heavy presence from Karak on Saturday and lifted a curfew imposed on the town on August 17, residents and officials said. Muasher said 32 of the 194 people detained during the riots had been released because they had not taken part in damaging government buildings or inciting violence. Those implicated in sabotage or incitement would be sent for trial within a week. 2627 !GCAT !GCRIM An Iranian court has sentenced 28 teenagers to punishment ranging from lashes to imprisonment for throwing a party and possession of illegal compact discs and video cassettes, a newspaper reported on Saturday. The evening daily Kayhan said they were arrested by the police anti-vice squad who broke up the party at a northern Tehran house in response to complaints by neighbours. The teenagers were condemned to punishment that included 10 lashes, payment of 100,000 rials ($33) and imprisonment. The woman who owned the house was fined 500,000 rials. The newspaper said police found illegal music cassette tapes and compact discs, as well as 41 "vulgar" videos at the house. Drinking alcohol and holding parties attended by both men and women are banned under Iran's strict Islamic laws. In April, an Iranian youth fell to his death from a balcony when police raided a flat in Tehran to break up a party. ($1 = 3,000 rials at the official exchange rate) 2628 !GCAT !GVIO Iranian Kurdish rebels say Iranian troops have entered northern Iraq to prepare a new assault on Kurdish guerrillas and refugees. The Democratic Party of Iranian Kurdistan (KDPI), in a statement received in Nicosia on Saturday, said Iran had sent more troops to the region in the past few days to launch fresh attacks. The statement appealed to other Kurds, Iranian political groups and international organisations to pressure Tehran to prevent it "from perpetrating this savage act". The group is based in Iraqi Kurdish areas outside the control of the Baghdad government. A small number of Iranian troops briefly entered northern Iraq last month in pursuit of KDPI guerrillas. The Iraqi Kurdistan Democratic Party (KDP) on Wednesday accused Iranian forces of killing or wounding around 100 people in daily artillery attacks this week on its positions in northern Iraq. A KDP spokesman accused Tehran of having entered fighting in northern Iraq in support of KDP's rival, the Patriotic Union of Kurdistan (PUK). PUK and KDP have had northern Iraq under their control since Baghdad's forces were ousted from Kuwait in the 1991 Gulf war. 2629 !GCAT !GDIP Japanese Foreign Minister Yukihiko Ikeda arrived in Amman on Saturday on a two-day visit to boost bilateral ties and discuss pushing ahead stalled Middle East peace talks, officials said. A Japanese embassy statement said Ikeda and Prime Minister Abdul-Karim al-Kabariti would sign an agreement on Sunday for a $7 million grant to Jordan for modernising the northern border crossing with Israel to help facilitate trade. It said the Japanese grant was "a concrete symbol of Japan's contribution to the peace process". Ikeda, who started his Middle East tour in Egypt, arrived in Amman by road from Damascus. He is due to visit Israel, the Palestinian self-ruled areas and Saudi Arabia later. Japan's soft loans and grants to Jordan in the last year have totalled $340 million, including $215 million in aid for balance of payment support and a $100 million loan to finance expansion of Jordan's largest power plant project in Aqaba. 2630 !GCAT !GPOL Former prime minister Mesut Yilmaz was re-elected as leader of Turkey's main opposition Motherland Party (ANAP) on Saturday, Anatolian news agency said. Yilmaz received 1,032 votes from the delegates at a scheduled party congress, beating challenger Isin Celebi, a former state minister in charge of economy, with 170 votes. Yilmaz, leader of ANAP for the past four years and twice prime minister, said he would bring change to the conservative party's policies during his new one-year term. "The future of our party means the future of Turkey," Yilmaz was quoted by the agency as telling a cheerful crowd gathered at a gymnasium in suburban Ankara. "We will realise a change -- a change that will make Turkey look brighter," he said. Yilmaz last became prime minister in February when ANAP, established in 1983 by late President Turgut Ozal, joined with Tansu Ciller's True Path Party (DYP) to form a minority coalition until it collapsed in June due to internal rifts. The DYP then formed a coalition with the Islamist Welfare Party led by the current Prime Minister Necmettin Erbakan in late June. 2631 !GCAT !GCRIM Iran has hanged two drug traffickers in the southern city of Shiraz, the evening newspaper Resalat reported on Saturday. The two Iranian men were arrested in July with 419 kilograms (924 lbs) of opium after they opened fire on police and killed a pedestrain and wounded four, the newspaper quoted a police commander as saying. Resalat said the executions were ordered by the Islamic Revolutionary Court. It did not say when they took place. One of the men, who killed the pedestrian, was hanged at the site of the crime and the other was executed in Adel prison in Shiraz, the newspaper said. Possession of 30 grammes (just over an ounce) of heroin or five kg (11 lb) of opium is punishable by death in Iran. More than 1,000 people have been executed in drug-related cases since the law took effect in 1989. Iran has an estimated one million drug addicts and is a key transit route for drugs, mostly opium, smuggled to Europe through Afghanistan and Pakistan -- the so called "Golden Crescent." 2632 !GCAT !GPOL The Palestinian minister who will lead the PLO team to peace talks with Israel said on Saturday that Israel had informed President Yasser Arafat that it wanted to begin the negotiations before September 2. "The Israelis have informed President Arafat that talks between the commitees will start before September 2, but they did not set a firm date," Local Government Minister Saeb Erekat told Reuters. Erekat will head the PLO team to the talks. Israeli Prime Minister Benjamin Netanyahu's spokesman Shai Bazak told Reuters: "It will start soon...We are not yet announcing a date." On Thursday Netanyahu, elected on May 29, telephoned Egyptian President Hosni Mubarak to tell him that peace talks with the Palestine Liberation Organisation (PLO) last held before the Israeli poll would resume "in the very near future". Netanyahu was apparently shaken by Mubarak's suggestion earlier on Thursday that he might cancel a Middle East economic summit in November over Israel's stalling peace moves. One PLO official, speaking on condition he not be named, said on Saturday that Israel was anxious to have the talks going before a meeting of international donors who have pledged support for the peace process. "Israel wants the talks to start before the September 5 international donors meeting so they will ease pressure on them over freezing the peace talks and to show the donors it is committed to the peace process," the PLO official said. There is still no Israeli announcement of a date for a long-delayed troop redeployment in the West Bank town of Hebron. The PLO regards the redeployment, to which Israel's previous government committed itself in an accord signed with the PLO last September, as a test of Netanyahu's peace intentions. Israeli Defence Minister Yitzhak Mordechai recently presented a revised redeployment plan to Netanyahu. Israel's cabinet statement on Friday quoted Netanyahu, who wants to renegotiate the Hebron deal at the peace talks, as saying no new redeployment agreement would be signed without first being presented to the entire government. Israel has said it would not implement the Hebron plan until the Palestinian Authority closed its offices in Arab East Jerusalem. Palestinians have rejected the condition as well as Israel's intention to renegotiate the Hebron deal. Aside from issues like Hebron hanging over from interim peace deals signed by Israel's previous government, the Palestinians and Israeli still have to negotiate a final peace. Final status issues include borders, refugees, Jerusalem, Jewish settlements, and the nature of the Palestinian entity. Netanyahu has said interim issues should be settled before moving to final status matters. 2633 !GCAT !GVIO The Palestinian Authority has freed a West Bank Hamas Islamic group leader it had detained for almost six months at Israel's demand. Palestinians said on Saturday that Sheikh Hassan Yousef was released from jail in the West Bank Ramallah self-rule enclave on Friday. Yousef, reached at home in Ramallah on Saturday, told Reuters: "I was released yesterday at noon. There were no conditions for my release. There were no charges against me from the beginning." Yousef, a Hamas leader in the Ramallah area, was rounded up with about 900 Islamists after Hamas and Islamic Jihad suicide bombers killed 59 people in Israel in four attacks in February and March. Israel and the United States put pressure on Palestinian President Yasser Arafat to crack down on militant groups after the attacks. The then Israeli prime minister Shimon Peres gave Arafat a list of about a dozen Hamas men he wanted jailed. Palestinian sources said Yousef's name was on the list. The authority recently began gradually releasing detainees. Yousef said Hamas had no interest in creating more tension with the Palestinian Authority. "We call upon the Palestinian Authority to release all the prisoners, to create a suitable atmosphere between the two sides, Hamas and the authority, to confront the new development in the Israeli field," he said. Peres, who had led Likud leader Benjamin Netanyahu in Israeli public opinion polls before the suicide bombings, was defeated by Netanyahu by less than a percentage point in May 29 elections. Netanyahu rejects trading occupied Arab land for peace, the basis for negotiations with the Palestinians that led to the interim peace deal in 1993 that set up self-rule in parts of the West Bank and Gaza Strip. Final status talks began before Israel's elections, but have yet to resume. Hamas and Islamic Jihad led opposition to the 1993 deal, which they called a sellout, by attacking Israelis. 2634 !GCAT !GPOL Tunisia's main opposition party on Saturday announced that it had been ousted from its headquarters building by a court decision for failing to pay the rent. Mohamed Ali Khalfallah, spokesman for the Movement of Socialist Democrats (MDS) said that a bailiff who was accompagnied by policemen, on Saturday ordered the party to leave the building. "We were not allowed a delay to enable us to transfer the movement's goods and documents," Khalfallah added in a statement. The building is state property. The MDS was represented in court and admitted owing money for rent but did not give details. MDS this year lost its president and vice-president, both of whom were tried and given jail sentences. MDS president Mohamed Moada was sentenced last February to 11 years in jail on charges of having secret contacts with Libyan agents and receiving money from Tripoli. Vice-president Khemais Chammari last July was sentenced to five years in prison on a charge of disclosing secrets of judicial proceedings in Moada's affair. To replace Moada, the MDS after the trial named Khalfallah as "coordinator" but Ismail Boulahya, the last of the MDS founding members still politically active, claimed the title of president, causing a new split within the movement. MDS was founded in 1978 by a group led by Ahmed Mestiri, who withdrew from politics in 1992. Succeeding him as head of the movement, Moada, an Arab nationalist, ousted liberals led by MDS secretary-general Mustapha Ben Jaafar in 1993. 2635 !GCAT !GDIP Japanese Foreign Minister Yukihiko Ikeda left Damascus for Jordan on Saturday after meeting President Hafez al-Assad and signing a 1.022 billion yen ($9.46 million) grant to Syria, Japanese officials said. A Japanese Foreign Ministry spokesman told Reuters Ikeda told Assad that Japan wanted to see an early resumption of the peace negotiations between Israel's new government and Arabs on the basis of the land-for-peace principle. "This was the message which we conveyed here and we will convey it when we go to Israel later on this trip," he said. Ikeda also stressed the necessity of fighting all types of "terrorism", the spokesman said. Japanese officials said Ikeda, who started his Middle East tour in Egypt, left Damascus for Jordan by road. He will also visit Israel, the Palestinian self-ruled areas and Saudi Arabia. Earlier on Saturday, Ikeda and Syrian Minister of State for Planning Affairs Abdul-Rahim Sbai'y signed an agreement for a 1.022 billion yen grant to help finance the construction of an electric power training centre in Syria, the spokesman said. The agreement brings Japan's soft loans, grants and techincal assistance given to Syria since 1973 to a total of more than $1.5 billion at the current exchange rate. 2636 !GCAT !GCRIM !GHEA A 14-year-old Egyptian girl died on Saturday after an operation to circumcise her, security sources said. They said Amina Abdelhamid Mohammed did not wake up after the surgery, which was carried out at a private hospital in Qalyubiya province, just north of Cairo. The surgeon disappeared after the operation, the sources added. Police were called in to investigate the case. It is not clear what killed the girl, the sources said. Health Minister Ismail Sallam last month banned female circumcision operations at public hospitals. Female circumcision, which usually involves the removal of all or some of a woman's external genitalia, is common in some Middle Eastern and African countries. Some Egyptians claim the procedure is based on Islamic teaching, but others claim it has more traditional roots because Moslem and Christian girls are circumcised. Women and human rights groups have called on the government to ban female circumcision outright. 2637 !GCAT !GDIP Syrian President Hafez al-Assad said on Saturday that he was still committed to making peace with Israel on the basis of the land-for-peace principle. Assad's remarks on peace, his first after Syria and Israel this week accused each other of preparing for war, were made during talks with Japanese Foreign Minister Yukihiko Ikeda, presidential spokesman Joubran Kourieh said. "President Assad said that Syria was still committed to the peace process on the basis of the international legitimacy, (U.N.) resolutions and the land-for-peace principle," Kourieh said. Israel sent Syria a message on Wednesday via Washington saying it was committed to peace and wanted to open negotiations without preconditions. Syria and Israel accused each other this week of escalating tension. Israeli television reported on Monday that Damascus had recently test fired a Scud C missile able to hit most cities in the Jewish state. Syria and other Arab states have condemned Israeli Prime Minister Benjamin Netanyahu for refusing to exchange occupied Arab lands with peace, a principle which was endorsed by his predecessor Shimon Peres. Israel broke off peace talks with Syria and recalled its negotiating team from Washigton in March after a wave of suicide bombings by Islamic militants killed 59 people in Israel. 2638 !GCAT !GCRIM !GDIP !GPOL !GVOTE North Lebanon votes on Sunday in the second stage of parliamentary elections that have raised a storm of protests against alleged vote-rigging in favour of supporters of the pro-Syrian government. Some 580,000 voters are eligible to cast their ballots for 28 seats in the 128-member parliament in what newspapers have dubbed the most confusing round of the five-stage election. Lebanon has no true national political parties and the battle will be fought between five lists of candidates formed on the basis of local alliances and personal rivalries. None offers a clear choice between the government and the opposition. However, several supporters of billionaire Prime Minister Rafik al-Hariri, who will run in Beirut next week, are scattered among the different tickets in the north as he seeks to build a personal political base across the country. Just about all the candidates in the north are friends of Syria, whose 35,000 troops give it a powerful say in Lebanese affairs and a close interest in the elections. Even candidates who oppose the government are not against its pro-Syrian stance, unlike in the first round of voting in Mount Lebanon last Sunday when nationalist Christians accused the government of whittling away Lebanon's sovereignty. Former prime minister Omar Karami, a Sunni Moslem, and Suleiman Franjieh, a Maronite Christian and former minister, are the most prominent anti-government candidates. Both are harsh critics of Hariri and close friends of Syria, and partly due to Syrian influence they have three Hariri supporters on their list, including Information Minister Farid Makari, one of four ministers in the race. The Karami-Franjieh list won 25 of the 28 seats in the last elections in 1992, but it could lose some seats this time to a rival ticket headed by Karami's cousin Ahmed Karami. Ahmed's list also has three Hariri supporters alongside three candidates of the Sunni Moslem fundamentalist group Gama'a Islamiyeh (Moslem Group) which opposes Hariri. The Gama'a is allied in parliament with the pro-Iranian Shi'ite Moslem Hizbollah (Party of God) which Hariri denounces as "extremist". Newspapers and opposition politicians have expressed concern that the north could see a repeat of electoral abuses that marred the Mount Lebanon vote when the government rolled out a powerful electoral machine and pro-government candidates won 32 of the 35 seats. Several defeated candidates have announced they will lodge appeals with the Constitutional Council for cancellation of the results, on the basis of widespread intimidation and fraud, and for a new vote in their constituencies. They have accused the government of trying to distort Lebanese democracy by excluding the opposition from parliament through electoral fraud in order to return a pro-government assembly similar to those in other Arab countries. 2639 !GCAT !GVIO An Iraqi Kurdish guerrilla group on Saturday accused Iraqi government forces of killing two civilians in shelling in northern Iraq, the Iranian news agency IRNA reported. IRNA said it was monitoring a report from a radio station affiliated to the Patriotic Union of Kurdistan (PUK). "Iraqi army heavily shelled the Kanie Karzhala camp, west of Arbil, on Friday...Two civilians were killed in the Iraqi bombing," IRNA quoted the radio report as saying. The PUK-run radio on Friday said Iraqi heavy artillery was pounding its positions in Kurdish-controlled northern Iraq but it gave no details of casualties. There was no independent confirmation of the reports. The rival Kurdistan Democratic Party (KDP), which accuses Iran of supporting the PUK, said on Thursday that its forces had halted an Iranian-backed attack by thousands of PUK fighters. The United States said in Washington on Friday that it had brokered a ceasefire to end six days of fighting between the two main Kurdish factions and persuaded them to attend U.S.-mediated peace talks next month. The clashes, shattering a ceasefire negotiated last year by Washington, had threatened a U.S.-led peace plan to unite the Kurdish region against Iraqi President Saddam Hussein. U.S., British and French planes have been patrolling the skies of northern Iraq since shortly after the 1991 Gulf War to shield Iraq's Kurds from any attack by Iraqi troops. 2640 !GCAT These are the leading stories in the Moroccan press on Saturday. Reuters has not verified these stories and does not vouch for their accuracy. LE MATIN DU SAHARA - Cabinet meeting approves law shaping constitutional reform. Referendum to decide whether parliament should split into two chambers is due on September 13. - Morocco's Salah Issou breaks the men's 10,000 world record in Brussels. - Euro-Maghreb gas pipeline to start operating in October. L'OPINION - World Bank says Morocco should reform insurance and banking sector to reduce unemployment. - Huge fire destroys shantytown in Casablanca. AL-ANBAA - Tangier main transiting route for Moroccan expatriates returning home for summer. 2641 !GCAT !GVIO Jordan on Saturday withdrew its heavy army presence from the southern city of Karak and lifted a curfew on its residents with the return of order after bread riots a week ago, residents and officials said. Armoured vehicles that had ringed Karak and deployed along most of the old city's inner roads were all pulled out at dawn, hours after the main Friday prayers, the starting point of last week's troubles, passed peacefully, residents said. Officials said a tight curfew imposed since August 17 was lifted at five a.m. (0200 GMT). "The army has pulled out of the city and the tension has begun to ease after the king's speech that things will change to the better," Ahmad Mahadeen, the Islamist elected mayor of the city, told Reuters. Many Karak residents said a conciliatory speech by King Hussein on Thursday appeared to ease the tension fuelled by his "iron fist" policy of mass arrests and a military curfew after the August 16-17 riots. "People realise immediate measures by the government would mean an erosion of the state's authority and that it has succumbed to pressures," Mahadeen said. "We pray to God that the government will lift the suffering of the people by going back on the price increase." Karak was shook by two days of riots when thousands of angry protestors went on a rampage over higher bread prices that turned into the worst unrest in Jordan since 1989. Karak residents said only a few anti-riot armed vehicles manned by security forces were present guarding state buildings. King Hussein in his Thursday speech defended the new bread prices but told parliament deputies -- most opposed to the price increase -- he remained committed to democracy, public freedoms and fighting corruption and abuses of power. The king blamed Iraq and a local pro-Baghdad group for the riots after the government raised bread prices under IMF-agreed economic reforms. Official sources said on Friday Jordan had asked an Iraqi diplomat to leave because he was carrying out duties "incompatible with diplomatic norms", implying he was accused of spying. Jordan's state controlled media on Saturday stepped up its campaign of allegations of official Iraqi involvement in the troubles, citing evidence gathered from detainees and suspects rounded up of pro-Baghdad links. But critics blame the riots on poverty and unemployment. Bread is a staple food for the poor who form a majority of Jordan's 4.2 million people. 2642 !GCAT !GDIP !GVIO Iran has accused Iraq of violating the ceasefire ending their 1980-88 war some 32 times between the end of March and May 31 this year, the Iranian news agency IRNA reported on Saturday. Iran's deputy representative to the United Nations, Majid Takht Ravanchi, made the allegations in a letter to U.N. Secretary-General Boutros Boutros-Ghali on Friday, the agency said. "The Islamic Republic of Iran has reported some 32 new cases of ceasefire violations by the Iraqi regime between March 31 and May 31, 1996," it reported from New York. It said violations included constructing observation posts, installing mortars and anti-aircraft cannons, setting up tents, penetrating Iranian territory, and firing rifle grenades towards Iranian territory. The eight-year war between the two countries ended with a U.N.-sponsored ceasefire. 2643 !GCAT These are the leading stories in the Tunisian press on Saturday. Reuters has not verified these stories and does not vouch for their accuracy. LA PRESSE - President Ben Ali orders Foreign Affairs Minister Ben Yahia to follow up contacts at bilateral, regional and international levels on Middle East peace process. ASSABAH - PLO's Farouk Kaddoumi praises Tunisia's efforts in Middle East peace process. 2644 !GCAT These are some of the leading stories in the Jordanian press on Saturday. Reuters has not verified these stories and does not vouch for their accuracy. AL RAI - Official sources confirm involvement of Iraq (in bread riots) and possible review of licence granted to local Jordanian branch of pro-Iraqi Baath Party. - Government lifts curfew on fortress city of Karak; return to normality in southern region. - Japanese foreign minister arrives in Amman on Saturday; officials say Japan backs Jordan politically and economically. - Israeli tourism minister to visit Amman next month. AD DUSTOUR - Peace prevails across kingdom; "satisfaction among Jordan's citizens and a large demonstration in Aye pledging loyalty to King Hussein." - Canadian pledge to help automate Amman Financial Market. - Total foreign currency assets of banking sector top four billion dinars in half-year 1996. AL ASWAQ - Officials say Baghdad intervened and attempted to bring downfall of Prime Minister Kabariti, with Iraqi plot and specific instructions relayed to instigators of troubles in south. JORDAN TIMES - King opens channel for dialogue after crisis. - Calm prevails throughout Jordan with two peaceful demonstrations. - Jordan expels Iraqi diplomat. - News analysis: government in reflective mood after jolt. 2645 !GCAT !GDIP !GVIO A Kuwait newspaper reported on Saturday it received a bomb threat following faxed statements critical of its writing on Israel and the United States. "I will blow up your newspapers," the Arabic daily Watan quoted one of three faxes it received on Friday as saying. "Watan; you cannot write about Israel and America. You fear. Cowards," the privately owned newspaper quoted a message faxed to the paper earlier the same day as saying. Another read: "To the chief editor and journalists, media should be set against the real enemy, Israel and its allies. The pen weapon should not write what would divide Arabs and Moslems." The paper said it did not know how serious the threat was, but noted it would have no bearing on its position. Watan's editorial position on the U.S. and Israel is widely seen as moderate. Many Islamist columnists write for the paper, which runs a weekly supplement promoting Islamic values. Washington is Kuwait's closest Western ally after it led an international coalition in 1991 to end Iraq's occupation of the Gulf Arab state. Kuwait has said it would not normalise relations with Israel until there was a full comprehensive Arab-Israeli peace. 2646 !GCAT These are some of the leading stories in the official Iraqi press on Saturday. Reuters has not verified these stories and does not vouch for their accuracy. JUMHOURIYA - Istanbul chamber of commerce urges Ankara to resume trade with Iraq. - Offers from Arab and foreign companies to supply Iraq with goods. - Four ships unload tonnes of Iraq-bound sugar at Jordan's Aqaba. - Editorial blames U.S. for latest flare-up of fighting between Kurdish rebels in northern Iraq. - Black market booms in the shadow of state-run supermarkets. - Parliament completes draft law on protection of river waters in Iraq. QADISSIYA - Iraq denounces violation of airspace by U.S. warplanes. IRAQ - Editorial lambasts Jalal Talabani, leader of a Kurdish rebel faction in the north, for liaising with Iran in its fight against rivals. BABEL - Blaming Iraq for riots in Jordan is a dirty game. 2647 !GCAT These are the leading stories in the Egyptian press on Saturday. Reuters has not verified these stories and does not vouch for their accuracy. AL-AHRAM - Contacts with Britain to stop conference of terrorism leaders in London. - $19 billion held as monetary reserves to secure needs from abroad. Strict rules for banking facilities and central monitoring to face credit risks. - U.N. Security Council head accepts Egypt's proposal rejecting the condemnation of Iraq. - Water level continues its quick increase in Nasser lake in front of the High Dam. AL-AKHBAR - The cabinet discusses companies and trade draft laws. - Oil Minister Hamdi el-Banbi: Egypt has the right to sell its oil to those who pay more, and Israel has the right to diversify its imports resources. AL-GOMHURIA - Profits for one million labourers in mid-September. - 1,000 millionaires evade taxes. 10 billion pounds went to the state treasury in three years. $1 = 3.40 pounds -- Cairo newsroom +20 2 578 3290/1 2648 !C13 !CCAT !GCAT !GCRIM !GHEA !GPOL !GVOTE Republican presidential candidate Bob Dole, after three days of silence on the new U.S. teen smoking rules, on Saturday tersely acknowledged that President Bill Clinton was moving against teen smoking but faulted him for neglecting the war on drugs. "I am pleased that President Clinton has finally recognised the dangers of teen smoking," Dole said a brief written statement. "I am proud of my long and consistent record of support for common sense measures to keep tobacco products out of the hands of minors." But Dole went on to attack Clinton on drug abuse. "Through ineptitude and neglect, this administration has presided over one of the largest increases in teenage drug use in American history," he said. Except for this three paragraph written statement that did not include any specifics about the new regulations, Dole had not responded to reporters questions about the smoking rules, which include restrictions on advertising, vending machines and sponsorship of sporting events by tobacco companies. A frequent critic of the Food and Drug Administration, Dole got into political trouble earlier this year by suggesting that tobacco may not be addictive. At a rally in New Orleans, where he touted his plan to balance the federal budget while slashing taxes, Dole vowed a new war on drugs if he wins the White House. "We're going to declare a war on drugs and drug kingpins and all the other people who sell these poisons to our young people," he said. In both Louisiana and Florida on Saturday, Dole was selling his economic plan, including a 15 percent tax cut and halving the capital gains tax on investment while balancing the federal budget. In Tampa, Florida, home to legions of retirees, he said he could fulfil his economic goals without endangering Medicare health programmes and Social Security payments. "We're trying to save the programmes. We're going to save the programmes. We're not going to devastate the programmes," he told a rally at the University of Tampa. Democrats say Dole's economic numbers do not compute, and that when Republicans talk about "slowing the rate of growth" of Medicare spending, they really mean cutting it and shifting more costs to the elderly. Dole supports the latest Republican budget proposal, which would cut projected Medicare spending by about $160 billion by the year 2002. On Saturday, he charged the Democrats with using scare tactics on Medicare, one of the broadest government programmes in America. He also repeated his promise to repeal a 1993 tax on Social Security benefits that applied to more affluent people over age 65. 2649 !E21 !ECAT !GCAT !GPOL !GVOTE Republican presidential candidate Bob Dole proposed on Saturday to close the Commerce and Energy departments, auction off airwaves and cut government spending to pay for his sweeping tax cut plan. "We'll begin by closing down two bureaucracies with duties that can be better performed elsewhere -- the Department of Commerce and the Department of Energy," Dole said in a radio address with his running mate, Jack Kemp. "And we'll root out waste, duplication and inefficiencies in every layer of government," Dole said. Those cuts in government spending would save $110 billion over six years, he said, helping to offset the 15 percent reduction in income taxes, halving of the capital gains tax and $500-per-child tax credit he proposed three weeks ago in a plan for six years and $548 billion worth of tax cuts. In an interview with the Chicago Tribune published on Saturday Dole said promoting a balanced budget amendment to the Constitution would come ahead of his tax cut proposal during the campaign. "The balanced budget amendment is going to be No. 1, balancing the budget by the year 2002, and tax cuts are No. 2," he said. The Clinton-Gore campaign said Dole appeared to have retreated from his pledge to cut taxes. But Dole's spokesman insisted that Dole had not shifted his priorities. "Bob Dole's commitment to balancing the budget and balancing taxes has not changed," said press secretary Nelson Warfield. President Bill Clinton in a similar pre-convention interview with the Tribune also published on Saturday said that while Dole's tax cut proposal might appeal to swing voters, the move would drive up interest rates. "We have 4.5 million new home owners, almost ... we have 10 million home owners that have refinanced their homes at lower rates. We have record car sales," Clinton said. "And if we go to the bank and borrow money to give ourselves a tax cut that we can't afford, that will drive up interest rates and it will force the next Congress and Sen. Dole to make even bigger cuts in Medicare, Medicaid, education and the environment," he added. Earlier, Dole had said the government could save $32 billion over six years by getting rid of all non-defence activities in the Energy Department, including key science and technology labs. On Saturday, however, the campaign said that instead of closing down the labs, a Dole administration would shift them to the National Science Foundation. The Dole Kemp campaign specifically cited the need to cut outdated programmes such as "a programme to produce methane gas from 'tuna sludge'" and stop spending of taxpayer dollars on overseas trips by Energy Department mid-level officials. The non-defence labs account for about $17 billion, or more than half the money the Dole plan aims to save over six years by eliminating the whole department, according to Energy Department figures. To meet the spending cut targets, the government would have to sell off the Energy Department's power marketing administrations, a move that the Clinton administration proposed and failed to pass last year, the Dole campaign said. Sale of the airwave spectrum to broadcasters and the telecommunications industry were projected to generate an additional $34 billion, according to the Dole programme. Closing of tax loopholes and other reforms would help save another $55 billion, said economist John Cogan of the Hoover Institution, who is working with the Dole-Kemp campaign. Dole's plan assumes that the government would gain $147 billion in new revenue as a result of the tax cuts and deficit reduction. The plan also hinges on a revision of Congressional budget revenue projections, adding an extra $80 billion, based on increases in revenue seen this year. 2650 !GCAT !GCRIM !GPOL President Bill Clinton, pledging that the law would follow child molesters wherever they went, said on Saturday a temporary system to keep track of sex offenders would be in place within six months. The national database would be compiled from information supplied by each state, while a new computer network would allow police to determine quickly and efficiently whether an individual was a registered sex offender anywhere in the United States, Clinton said in his weekly radio address. "Deadly criminals don't stay within state lines, so neither should law enforcement's tools to stop them," he said. Clinton's announcement was an interim step in the establishment of a permanent National Sex Offender Registry due to be completed by mid-1999. This file, when fully operational, would include state-of-the-art identification techniques such as DNA, fingerprint matching and mug shots, Justice Department officials said. The idea of a national listing grew out of the 1994 crime bill that required each state to create a registry of those convicted of sexual assaults. It received a boost in May when Clinton signed a law requiring states to notify communities when sex offenders moved into the neighbourhood. "Today I am pleased to announce that we are following through on our commitment to keep track of these criminals, not just in a single state, but wherever they go, wherever they move -- so that parents and police have the warning they need to protect our children," the president said. Explaining how the system would work, Clinton said every time a sex offender was released, his state would force him to register. The FBI then would compile these state lists into a national database. "Within six months, a new computer network will give states information from every other state for the very first time. ... Then they will share that information with the families and communities that have a right to know," he said. Republicans were quick to point out that they had proposed the federal registry earlier. "Once again, Bill Clinton has proven to be the Xerox president," Christina Martin, the Dole campaign's deputy press secretary, said. "For the second time on the same subject, he actually lifted a page out of the 1992 Republican platform." But Republican Sen. Phil Gramm of Texas praised the move, which mirrored legislation he introduced last April with Democratic Sen. Joseph Biden of Delaware. "Bill Clinton and I disagree on many critically important policy matters, and while I cannot judge his intentions in adopting our sex predator tracking system now instead of lending his backing when it was introduced ... I am pleased that this tracking system will now soon go into effect," Gramm said in a statement. Groups such as the American Civil Liberties Union have voiced fears that the national registry planned by the Clinton administration would infringe on Constitutional protections, but the president said on Saturday more than local solutions were necessary to stop sexual predators. "This national registry sends a simple message to those who would prey on our children; The law will follow you wherever you go," he said. Clinton, seeking to promote his anti-crime credentials in this presidential campaign season, noted that he already had undertaken "aggressive" measures to reduce the crime rate, take guns off the streets and put more police officers on the beat. But he said nothing was more threatening to families, communities and basic human values than sex offenders who victimised children. "Study after study tell us that they often repeat the same crimes," Clinton said. "That's why we have to stop sex offenders before they commit their next crime, to make our children safe and give their parents peace of mind." 2651 !C11 !C12 !CCAT !GCAT !GCRIM A lawyer for U.S. investors who blocked the reorganization plan of insurance giant Lloyd's of London said on Saturday that a panel of judges would consider Lloyd's appeal of the injunction on Tuesday. Susan Cahoon, one of the lawyers representing the investors, told Reuters she expected to receive a motion for a stay by Sunday afternoon. On Friday, a U.S. federal judge issued a preliminary injunction thwarting the Lloyd's reorganization plan, but shortly afterward, a lawyer for the venerable institution said an appeal had already been filed. The "reconstruction and renewal" plan called for investors to fund a newly formed reinsurance company, Equitas. But, already near financial ruin from existing Lloyd's investments, they were sceptical, claiming Lloyd's had not supplied them with sufficient information about Equitas and thus breached U.S. securities laws. Judge Robert Payne of the U.S. District Court for Eastern Virginia concurred and ordered Lloyd's to comply within one month. He ruled the 93 U.S. investors in the case would suffer irreparable harm if the preliminary injunction was denied. He said the purpose of the order was to protect Americans, the Lloyd's offer and the Aug. 28 deadline to vote on it. Lloyd's attorney Harvey Pitt, of Washington law firm Fried, Frank, Harris, Shriver & Jacobson, called the order "surprising and disappointing," and said Lloyd's was hopeful it could be dealt with on appeal. "Obviously we're going to pursue an expedited appeal and try to deal with this in a very orderly and expeditious manner," Pitt said after the ruling late on Friday. But Cahoon, speaking from her Atlanta home on Saturday, said the first step was for Lloyd's lawyers to file a motion to stay Payne's order. "Plaintiffs' lawyers are due to receive on Sunday what we believe will be the motion for a stay of the trial court's order pending a full review of the case by the 4th Circuit," she told Reuters. Then, she said, an emergency panel of the 4th Circuit appeals court would convene in Baltimore on Tuesday to hear the motion. Cahoon said the hearing would take place there because two of the judges were already there. The 4th Circuit Court of Appeals is also based in Richmond and covers Virginia, the Carolinas, Washington and Maryland. In Friday's order, Payne also ruled that the injury the plaintiffs and other American investors would suffer significantly outweighed any harm to Lloyd's of complying with its obligations under the securities laws of the United States. Investors, whom Lloyd's calls Names -- individuals who pledge their assets to back the insurance policies sold at Lloyd's -- were being asked to pay up to $150,000 each to help fund Equitas, which would take responsibility for $12.4 billion in losses from asbestos, pollution and disaster claims between 1988-92. The ruling effectively blocks creation of Equitas, and Lloyd's has been given until Sept. 23, 1996, to see that American Names receive information on Equitas. Moreover, the ruling provides a safety net for investors already leaning toward supporting the recovery plan. They can pay into an escrow account (in lieu of Equitas) set up by the court by Sept. 30. They then have until Oct. 30 to review the information and tell Lloyd's whether they accept the offer. If they accept, their funds would be released from the escrow account to Lloyd's; but if they reject the offer, their funds stay in escrow until the recovery plan was finalised. Lloyd's Chief Executive Ronald Sandler said during hearings this week that Equitas could not begin life unless it has all of its assets. 2652 !GCAT !GCRIM President Bill Clinton, pledging that the law would follow every move of every child molester, said on Saturday a temporary system to track sex offenders throughout the country would be in place within six months. The national database would be compiled from information supplied by each state, while a new computer network would allow police to determine quickly and efficiently whether an individual was a registered sex offender anywhere in the United States, Clinton said in his weekly radio address. "Deadly criminals don't stay within state lines, so neither should law enforcement's tools to stop them," he declared. Clinton's announcement was an interim step in the establishment of a permanent National Sex Offender Registry due to be completed by mid-1999. This file, when fully operational, would include state-of-the-art identification techniques such as DNA, fingerprint matching and mugshots, Justice Department officials said. The idea of a national listing grew out of the 1994 crime bill that required each state to create a registry of those convicted of sexual assaults. It received a boost in May when Clinton signed a law requiring states to notify communities when sex offenders moved into the neighbourhood. "Today I am pleased to announce that we are following through on our commitment to keep track of these criminals, not just in a single state, but wherever they go, wherever they move -- so that parents and police have the warning they need to protect our children," the president said. Explaining how the system would work, Clinton said every time a sex offender was released, his state would force them to register. The FBI then would compile these state lists into a national database. "Within six months, a new computer network will give states information from every other state for the very first time ... Then they will share that information with the families and communities that have a right to know," he said. Republican Sen. Phil Gramm of Texas praised the move, which mirrored legislation he introduced last April with Democratic Sen. Joseph Biden of Delaware. "Bill Clinton and I disagree on many critically important policy matters, and while I cannot judge his intentions in adopting our sex predator tracking system now instead of lending his backing when it was introduced ... I am pleased that this tracking system will now soon go into effect," Gramm said in a statement. Groups such as the American Civil Liberties Union have voiced fears that the national registry planned by the Clinton administration would infringe on Constitutional protections, but the president said on Saturday more than local solutions were necessary to stop sexual predators. "This national registry sends a simple message to those who would prey on our children; The law will follow you wherever you go," he said. Clinton, seeking to promote his anti-crime credentials in this presidential campaign season, noted that he already had undertaken "aggressive" measures to reduce the crime rate, take guns off the streets and put more police officers on the beat. But he said nothing was more threatening to families, communities and basic human values than sex offenders who victimised children. "Study after study tell us that they often repeat the same crimes," Clinton said. "That's why we have to stop sex offenders before they commit their next crime, to make our children safe and give their parents peace of mind." 2653 !C11 !C12 !CCAT !GCAT !GCRIM A U.S. district judge issued a preliminary injunction on Friday delaying the reorganization plan of insurance giant Lloyd's of London, but the firm's chairman said an appeal had been filed. Lloyd's reorganization plan was linked to having investors fund a newly formed reinsurance company, Equitas, but some became skeptical, claiming Lloyd's would not provide them with sufficient information and thus breached U.S. securities laws. U.S. District Court Judge Robert Payne agreed and ordered Lloyd's to give the information to investors within a month. Payne ruled the 93 U.S. investors in the case would suffer irreparable harm if the preliminary injunction was denied. "The defendant's (Lloyd's) motion to dismiss is denied and the plaintiff's motion for preliminary injunction is granted," the judge said in his written ruling. Investors, whom Lloyd's calls Names -- individuals who pledge their assets to back the insurance policies sold at Lloyd's -- were being asked to pay up to $150,000 each to help fund Equitas, which would take responsibility for $12.4 billion in losses from asbestos, pollution, and disaster claims between 1988-1992. The ruling effectively blocks creation of Equitas and Lloyd's has until September 23 to see that American Names receive information on Equitas. There are 2,700 U.S. Names and nearly 34,000 worldwide. Following the decision, Lloyd's Chairman David Rowland said in a statement issued in London: "We regret the decision reached in the Virginia District Court. We have lodged an immediate appeal, which is likely to be heard early next week in order that we should be able to proceed with our reconstruction program...." Lloyd's lawyer, Harvey Pitt, of a Washington law firm, called the order "surprising and disappointing." In Friday's order, Judge Payne also ruled that the injury the plaintiffs and other American investors would suffer significantly outweighed any harm to Lloyd's by complying with its obligations under the securities laws of the United States. Lloyd's Chief Executive Ronald Sandler had testified in hearings earlier in the week that Lloyd's solvency would be in doubt without the U.S. Names. The firm, which is more than 300 years old, wants investors to vote on acceptance or rejection of the recovery plan by next Wednesday. "Our outside date on (reconstruction and recovery) acceptance is 28th as planned, and our hope is that the Court of Appeals will be able to either stay the district court's order or resolve this matter so that the process gets completed in an orderly fashion," Pitt said. An appeal would take place at a date and time set by the U.S. 4th Circuit Court of Appeals, also in Richmond, Va. Until then Judge Payne ordered Lloyd's to send a copy of his 141-page order to every American Name. The judge ruled investments in Lloyd's were "securities" in part because Lloyd's has more than 500 Names and total assets of more than $10 million. "Lloyd's is in violation of the securities exchange act and that in seeking Names' consent to the settlement offer dated July 26, 1996, Lloyd's is using the U.S. mail and other means or instrumentalities of interstate commerce to solicit a proxy or consent or authorization from the plaintiff and the other American Names in contravention of rules and regulations promulgated by the Securities and Exchange Commission," Judge Payne ruled. The judge also provided for an escrow plan that extends the time for investors to decide. The investors can pay into an escrow account (in lieu of Equitas) set up by the court by September 30. They then have until October 30 to review the information provided by the firm and tell Lloyd's whether they accept the offer. If they accept, their funds will be released from the escrow account to Lloyd's. 2654 !GCAT !GCRIM !GHEA Jack Kevorkian's stepped-up efforts for assisted suicide -- which included two deaths and two hours in a police lockup on Thursday -- were wearing him down, his lawyer said on Friday. Attorney Geoffrey Fieger said Kevorkian would halt his assisted suicide campaign if other doctors and the medical establishment would step in to replace him. He said the 68-year-old retired pathologist was under a lot of stress. "He would stop as soon as the medical profession comes forward and a physician, according the guidelines set up for the medical profession, says he will help suffering patients." Fieger told WDIV-TV on Friday. Thursday's suicides, nine hours apart, brought to four the number of deaths that Kevorkian has attended in the past eight days, and to 38 the number he has attended since the launch of his death-on-demand campaign in 1990. He brought the body of Linda Smith, a 40-year-old nurse from Lee's Summit, Mo., to the emergency room at Pontiac Osteopathic Hospital about midday on Thursday and later, dropped off the body of Pat DiGangi, 66, a former college history teacher from New York City. Both patients suffered from multiple sclerosis, according to Fieger. After dropping off DiGangi's body, Pontiac police officers tried to question Kevorkian about the death. But he refused to cooperate, called officers "Nazis" and shoved one of them, police said. He was arrested for being disorderly in a public place and was detained in a holding cell for two hours. Police released Kevorkian without bond but had not yet decided whether to pursue misdemeanor disorderly conduct charges against him. The Smith and DiGangi deaths came less than a week after Kevorkian's involvement in the controversial suicide of Judith Curren, a 42-year-old Massachusetts nurse who suffered from chronic fatigue syndrome. The death called Kevorkian's screening methods into question because her illness was not fatal and she had lodged domestic abuse and assault charges against her husband, Franklin. In addition, the Boston Herald reported on Friday that Franklin Curren owed the Internal Revenue Service $335,000, partly due to the high cost of his wife's medical care. Early on Friday, Fieger defended Kevorkian's most recent actions. "It seems so unbelieveable to me that people are saying suddenly he's becoming reckless, suddenly he was in league with a battering husband," Fieger told reporters. "Why these allegations are being made, I think they're being made by his opponents solely to disparage him." The American Medical Association, which has long opposed his efforts, responded on Friday by urging the U.S. Supreme Court to rule against a constitutional right to assisted suicide. "The time has come for the highest court in the land to make a declaration on the misguided and unethical practice of physician-assisted suicide," AMA vice chairman Thomas Reardon said in a statement. On Tuesday, Kevorkian also was present when Louise Siebens, 76, of McKinney, Texas, took her life to relieve her suffering from amyotrophic lateral sclerosis, known as Lou Gehrig's disease. The illness is considered terminal. 2655 !GCAT !GDIP Two small airplanes piloted by a Cuban exile group resumed search-and-rescue flights on Saturday, six months after Cuban MiG jets shot down two unarmed exile airplanes between Florida and Cuba. The two Cessna planes left the Opa-Locka Airport on Saturday morning to fly over the Florida Straits and help any Cuban rafters trying to flee the island. The airplanes also planned to toss flower wreaths over the site of the February 24 attack, in which four exile pilots died. Cuba said the two planes were shot down over its territory, but the Montreal-based International Civil Aviation Organisation concluded that the attack took place over international waters. One of the passengers aboard the planes Saturday was Jose Basulto, a controversial Cuban exile who heads the group Brothers to the Rescue. The February attack worsened already-chilly relations between the communist government of Cuban President Fidel Castro and the United States and contributed to President Bill Clinton's recent decision to tighten the longstanding U.S. economic embargo against Cuba. "We do not want to spur the Cuban people in taking to the seas because we resume our flights," pilot and group member Pablo Lara said. "Our flights will not be announced and we will not have a fixed schedule." The exile pilots said they would toss a walkie-talkie to any rafters spotted on the dangerous Florida Straits that separate Cuba from the United States. The pilots said they would notify the rafters they could be returned to Cuba if intercepted by the U.S. Coast Guard. Pilots Guillermo Lara and Billy Schuss said they planned to fly south of the 24th Parallel, the boundary over which Cuba claims control of all air traffic. Basulto had his pilot's license suspended earlier this year by the Federal Aviation Administration for dropping anti-Castro leaflets over the Havana skyline. During the past two weeks, several Cuban exile families in Miami told Brothers to the Rescue they had received word that relatives would be attempting to leave the island on rafts. 2656 !GCAT !GDIP !GPOL The United States has called on Albania's ruling conservative Democrats to offer a bigger role to opposition parties in preparing local elections after a a national poll in May was boycotted by the opposition. "The United States government calls for broadening the political dialogue in Albania between the ruling and opposition parties as the first step toward holding free and fair local elections, adopting a new constitution and holding new parliamentary elections at the earliest opportunity," a State Department statement said. The statement, issued on Friday, said the United States believed that the ruling Democratic party must do more to reach out to the opposition parties, offering them a substantive role in preparing for local elections and in the make-up of an electoral commission. Most opposition groups, citing fears of a biased electoral process, have threatened to boycott the nationwide local ballot on October 20, five months after a disputed general election cast a shadow over the ex-communist country's young democracy. Albanian President Sali Berisha, a Democrat, earlier this month set up a 17-member permanent commission to organise future ballots, including the local polls in October. Foreign governments have indicated they will watch the polls closely as a test of Albania's commitment to democracy. The commission's membership is based on the performance of all political parties in the last local election in 1992, but the opposition said it was biased in favour of the ruling party and was not subject to adequate regulation. The main opposition Socialist Party, reformed heirs to the communists, have vowed that they will not take part in the commission. The U.S. State Department called on opposition parties to participate fully in the election process, however. "We recommend an inclusive formula for participation in future round table discussions," the statement said. 2657 !GCAT !GDEF Four women, in an historic move, enrolled on Saturday at South Carolina's formerly all-male military college, cheered on by a group of about a dozen supporters outside the Citadel's wrought-iron gates. Nancy Mace and Kim Messer both of South Carolina, Jeanie Mentavlos of North Carolina and Petra Lovetinska of Washington, D.C. were the first group of women willing accepted by the school based on a policy change. Like all Citadel freshmen, the four were not allowed to talk to the news media waiting at the front gate. They went to their barracks and put on shorts and T-shirts issued to all cadets for physical training. On Monday, all cadets are scheduled to receive uniforms to mark the start of Hell Week, so called for its aggressive, confrontational training exercises. "Everyone is focusing on how to make this a very successful orientation," Citadel acting president Clifton Poole told reporters. After the U.S. Supreme Court ruled in June that the all-male admissions policy at the state-supported Virginia Military Institute was unconstitutional, the Citadel, the only other state-funded, all-male college in the nation, dropped its legal battle and changed its policy within days. VMI has not yet decided whether to go private or admit women, as the order specified. Asked whether the cadets were instructed to behave in any particular way, Poole said, "You cannot tell them what to think and you can't tell them what to say except when they're in military formation." Lovetinska, whose grandfather was in the Czech army, had some of her fees paid by donations arranged through Langhorne Anthony Motley, a former U.S. ambassador to Brazil and a friend of Poole's. Poole said he offered an encouraging word to Lovetinska on Saturday morning, but she told him she was not nervous. "I am so happy to be here," he quoted her as saying. The only other woman to enroll at the Citadel was Shannon Faulkner, who dropped out after one week last August. She had been accepted in 1993, after deleting all references to gender on her application. The acceptance was withdrawn when officials discovered she was female but Faulkner sued in United States District Court, alleging her civil rights had been violated. 2658 !GCAT !GPOL !GVOTE President Bill Clinton has served notice he intends to be busy "making news" -- or at least doing things that look and sound like it in a campaign year. With Democrats gathering in Chicago to start a convention on Monday to nominate him for a second term as president, Clinton plans a steady parade of events designed to highlight his leadership and dim the glow of the just-concluded Republican conclave that gave a boost to rival Bob Dole. After a week of carefully orchestrated events signing into law bills passed by the Republican-controlled Congress, Clinton used his Saturday radio address to the nation to proudly "announce" a development in the war on crime. "Sixty days ago I directed the attorney general to draw up a plan for a national registry of sex offenders," Clinton said. "That plan has now reached my desk." "Today I am pleased to announce that we are following through on our commitment to keep track of these criminals, not just in a single state but wherever they go," he said. Actually, creation of such a registry was underway without Clinton lifting a finger. Attorney General Janet Reno's report -- all nine pages of it, including footnotes -- offers only the interim services of the FBI until a formal registry on sex offenders has been established. Two months ago, Clinton announced he wanted an interim effort established. Now, 60 days later, he had a chance to talk about it again. It is an example of Clinton's strategic planning as he heads into the stretch drive for the Nov. 5 presidential election. Such things do not happen by chance in the Clinton White House, they are part of his political chess game. In the past week Clinton signed into law an increase in the minimium wage, a bill that makes it easier for someone with a pre-existing health problem to change jobs, and sweeping changes overhauling the nation's welfare system. "America can look back on a week of remarkable achievement," Clinton said, without even a passing reference to the Republican majority in the House and Senate. "America is on the right track offering more opportunity, demanding more responsibility, building a stronger community, the sense of shared values and stronger families," he said in striking the theme of his coming week. According to a senior campaign official, Clinton "will be making a lot of news in the coming week -- something different each day." Clinton departs on Sunday on a four-day train trip through West Virginia, Kentucky, Ohio, Michigan and Indiana while fellow Democrats are gathered in Chicago. "He'll make news during the day ... and then at night the attention will go to the convention," said the campaign official. "We think it'll work really well." Although officials decline to say just what each day's "news" will be, the intent is to put a focus on Clinton himself and not just those attending the party's convention. Each day of the trip will have a late start, so that network television correspondents will be able to do live reports for morning programmes. Campaign officials then hope the day's "news" event will be showcased on evening television news shows as a lead-in for that night's convention programme. "We'll be concentrating ... on supporting the president as he is on the trip and making significant public policy statements related to some of his plans for the future," said White House Press Secretary Mike McCurry. McCurry said that when Clinton delivers his acceptance address on Thursday night to fellow Democrats and a national television audience, he will "set out a road map" for the nation's future -- one the president hopes guides him back to the White House for four more years. 2659 !GCAT !GPOL !GVOTE Republican presidential candidate Bob Dole on Saturday told the legions of elderly voters in Florida that they can stop worrying about their Medicare and Social Security. "We're trying to save the programmes. We're going to save the programmes. We're not going to devastate the programmes," he told a rally at the University of Tampa. For the third straight day, Dole declined to respond to the new regulations President Bill Clinton enacted aimed at restricting youths' access to tobacco, including banning most vending machines and limiting advertising. Dole got himself into political trouble earlier this year -- and was trailed for days by a protester dubbed "Buttman" dressed like a cigarette -- by suggesting that tobacco may not be addictive. The centrepiece of Dole's campaign is his vow to cut income taxes by 15 percent and halve capital gains taxes while balancing the federal budget. He says he can do this while "protecting" Medicare and Social Security. Democrats say Dole's economic numbers do not compute, and that when Republicans talk about "slowing the rate of growth" of Medicare spending, they really mean cutting it and shifting more costs to the elderly themselves. Dole supports the latest Republican budget proposal, which would slow down projected Medicare spending by about $160 billion by the year 2002. He also wants a bipartisan commission to tackle Medicare's longer-term problems, similar to the two-party Social Security commission he served on in the early 1980s. "Take it out of politics, lay politics aside ... do what you have to do to save the system," said Dole, repeating a suggestion he made often but to little avail during last year's protracted battle over Medicare, Medicaid and the federal budget. Dole, who voted against creating Medicare back in 1965 but who later acknowledged the program's success, said the Democrats were playing scare politics with Medicare. "It's time for leadership in America that doesn't try to frighten people," he said to a college campus audience, where the demographics were considerably younger than the rest of Florida. He also repeated his promise to repeal a 1993 tax on Social Security benefits that applied to more affluent people over age 65. Tampa was Dole's first appearance without running mate Jack Kemp, the chatty, ebullient former football quarterback who has energised the more taciturn Dole and been by his side since he was named to the ticket. Kemp was to campaign in South Dakota and Seattle on Saturday, but Dole spokesman Nelson Warfield said the two will reunite for "marquee events." With a divided Congressional delegation, Florida was considered a swing state, although it has gone Republican in all but one presidential election since 1968. With 25 electoral votes, it will be hotly contested this year. 2660 !GCAT !GDIS !GENV Hurricane Edouard grew stronger on Saturday as it swirled across the Atlantic Ocean, but forecasters at the National Hurricane Center said the storm would likely swing north and miss the Caribbean. "Edouard is getting stronger and stronger, and it already has winds of 105 mph (185 kph)," said hurricane forecaster Lixion Avila. "But the good news is that all our computer models indicate Edouard is going to turn to the west-northwest on Sunday and miss the islands," he added. At 11 a.m. EDT (1500 GMT), Edouard was 1,130 miles east of the Lesser Antilles and moving west at 14 mph (25 kph). Its exact position was latitude 14.5 north, longitude 44.2 west. 2661 !GCAT !GCRIM !GHEA Dr. Jack Kevorkian's frenetic suicide pace and questionable screening methods in recent days have alarmed opponents and supporters alike, but experts say there is little that can stop him. After a week that saw Kevorkian drop off four bodies at a hospital emergency room before being arrested for disorderly conduct, many are questioning whether the 68-year-old retired pathologist has lost control. "At this point, the bizarre has become normal and the ghastly is no longer seen as ghastly," said Dr. Linda Emanuel, vice president of ethics for the American Medical Association. "That's one of the mechanisms by which dreadful movements take place." But unless legislators are willing to enact a new law against assisted suicide, prosecutors are powerless to stop him, said Patrick Keenan, a professor of constitutional law at the University of Detroit-Mercy. Kevorkian has won acquittals on assisted suicide charges three times in the past two years, twice under a now-expired ban and once on common law charges. He has attended 38 deaths since starting his right-to-die crusade in 1990. Keenan said Oakland County Prosecutor Richard Thompson, who lost a re-election bid partly due to his costly efforts to bring Kevorkian to justice, was unlikely to take action now. "In the eyes of a jury, what Kevorkian is doing is not a crime in Michigan," Keenan said. "A solution to this problem has got to come from the legislature." Gov. John Engler, a Kevorkian opponent, said on Friday that he expected no new bills on assisted suicide for the remainder of the 1996 legislative session. "I do not have an answer. It's not an easy question," he told a radio talk show. If Kevorkian gets sloppy in his methods and pushes a wavering, depressed patient to commit suicide, he could face a murder charge, Keenan said. Many are asking such questions about the Aug. 15 death of Judith Curren, a nurse from Pembroke, Mass., who suffered from chronic fatigue syndrome, a non-terminal illness. An autopsy produced no evidence of disease, and police records subsequently revealed that Curren had lodged abuse and assault charges against her husband, Franklin, who attended her death. Questioning Kevorkian's medical skills, Oakland County Medical Examiner Ljubica Dragovic said the retired pathologist's last patient, Pat DiGangi, 66, who suffered from severe multiple sclerosis, had numerous needle holes in his body. Dragovic said that suggested Kevorkian had considerable trouble finding a suitable vein for his lethal injection. "It seems so unbelieveable to me that people are saying suddenly he's becoming reckless, suddenly he was in league with a battering husband," said Kevorkian's lawyer, Geoffrey Fieger. "Why these allegations are being made, I think they're being made by his opponents solely to disparage him." But even Hemlock Society founder Derek Humphry said he wants to stop the "shameful procession" of patients from across the country to Kevorkian's doorstep in suburban Detroit. In a statement, he urged doctors and politicians to make assisted suicide a legitimate medical practice. "We must not let this circus of death in Michigan get out of hand," Humphry said in a statement. "Dr. Kevorkian has made the point that people need this service of accelerated death and now is the time to act to do things better." "As long as the AMA is not prepared to make this a legitimate medical practice, they better be prepared to see him drop bodies off at Pontiac Osteopathic Hospital," said Howard Simon, director of the Michigan chapter of the American Civil Liberties Union, which supports assisted suicide but has distanced itself from Kevorkian. 2662 !C12 !CCAT !GCAT !GCRIM !GHEA By Gail Appleson, Law Correspondent The tobacco industry won a breather from mounting bad news with a greatly needed jury victory on Friday, but legal experts said the case was a tiny skirmish in a full-blown war. At the end of a day in which President Bill Clinton signed strict regulations for the sale and advertising of cigarettes, an Indianapolis jury ruled for cigarette companies in the widely-watched case. Tobacco companies longed for a victory in this trial to offset a $750,000 damage award delivered against it by a Florida jury earlier this month. Although cigarette makers said the verdict was an aberration, legal experts pointed out that there was a major difference between the two cases. The Jacksonville, Fla. jury had seen inflammatory internal tobacco documents relating to the industry's knowledge of nicotine and addiction while the Indianapolis jury had not. Jury consultants believe that the documents had a significant impact on the jurors, who found that cigarette companies were responsible for a smoker's addiction. The question that remained was: How will juries in the more than 200 pending cases across the country react if they are allowed to see this evidence? "I think the industry can take a breather with the Indianpolis verdict, but this does not mean it is the end of the war," said Mary Aaronson, a Washington D.C. litigation analyst who advises the institutional investors. "I do think the attitudes of jurors may be changing." In the approximately four decades of tobacco litigation aimed at holding cigarette companies liable for smokers' illnesses, there have only been two juries that have awarded damages to plaintiffs. In the past most jurors blamed plaintiffs for their decision to start and keep smoking. Personal injury lawyers and jury consultants predicted that the internal tobacco documents that began to surface in 1994 will change their point of view. They said that jurors, after seeing the memos, will hold tobacco companies responsible for hiding information about the alleged addictive nature of nicotine and will believe that the industry acts to keep smokers hooked. The industry denies these allegations. Because those documents will most likely be used in many of the upcoming cases, plaintiffs lawyers said the Indianapolis verdict was insignificant. "...It doesn't really set up back," said Richard Daynard, chairman of the Tobacco Products Liability Project at Northeastern Law School in Boston. Lawyers said that the verdict would have had far greater consequences if the tobacco industry had lost. They said a win for the plaintiffs would have provided even greater support for the view that jurors attitudes had changed because the panel had not even seen key tobacco documents. This could have had tremendous implications as jurors will one day be determining the outcome of the hundreds of suits currently pending on behalf of smokers, their families and people claiming injury from secondhand smoke. In addition, 14 states as well as San Francisco and Los Angeles have sued the industry to recoup health care costs of smokers. Tobacco lawyers dismissed these concerns. Charles Blixt, senior vice president, general counsel of R.J. Reynolds Tobacco Co., said that for years plaintiffs' lawyers had been touting that they had ideal cases but juries have almost always found them lacking. "This is not a court of public opinion, it is a court of law," he said. "Each (upcoming) case is a little bit different but we believe that in spite of those differences jurors will continue to find that people are responsible for the decisions they make in their life." 2663 !GCAT !GPOL !GVOTE Advocates of causes ranging from the plight of the homeless to space colonies will vie for attention during the Democratic convention. Unlike the nervous anticipation leading up to the 1968 convention when thousands of anti-Vietnam war protestors descended on Chicago, protests planned during the convention week were likely to produce a few skirmishes with police, but little else. Chicago Mayor Richard Daley and his police chief have been careful to instruct officers in the rights of demonstrators and admonished them about raising their truncheons. Among the scores of organisations wanting their say during convention week were pro- and anti-abortion groups, a coalition of six groups advocating the colonisation of Mars, politically oriented poets, non-political rock bands, supporters of a "living wage", and a group called the "College of Complexes" that promises speeches by "one fool at a time." At least 43 separate groups have secured hour-long slots to air their causes at two designated protest sites -- one at a parking lot near the United Centre convention venue and the other the downtown streetcorner that was the site of the infamous 1968 police "riot." Two federal judges have issued rulings granting small groups of protesters closer access to convention delegates. "It may be (the police) will play 'chase the hippie' for a couple of nights, but we think they won't," said Dana Beal, an organiser of a gathering reprising 1968's "Festival of Life." The loosely organised festival, taking its name from 1968 radical Jerry Rubin's play on the "Convention of Death" title placed on the Democrats' conclave, was refused permission to camp out overnight in the city's lakefront parks, a sore point 28 years ago when police cleared the parks with truncheons and tear gas. Hoping for an act of God to spare a confrontation, Beal said it would take a heatwave next week to trigger a city ordinance that allows Chicagoans to spend hot nights outside. Temperatures, however, were forecast to be cool. Beal also pledged that festival-goers will not be stopped from marching to a hotel where the group hopes to address concerns about the environment, drugs and other issues to the media. "These things (political conventions) are all scripted for the media anyway," Beal said, echoing the feelings of groups attracted to an event where 15,000 journalists were expected. One issue that may stir serious protests was the recent passage of federal welfare reform that was signed by President Bill Clinton. "I think there's going to be some vigorous protests next week. I think it's going to come from some surprising quarters," said Illinois Representative Bobby Rush, a former Chicago member of the Black Panther Party in the 1960s. Tom Hayden, a leader of the 1968 demonstrators who will be a delegate from California to this convention, organised a "Heal-in" on Sunday to honour past protesters. A homeless advocacy group, demanding more funding for low-income housing, promised to plant a tree in the middle of a downtown street and dress a man in a tree costume to follow Mayor Daley around. In the unearthly realm, a group called "Spacecause" said it would articulate "Americans desire to have a space programme that goes somewhere." "We urge a dialogue to return space to the forefront of the American agenda," the group's leader, attorney Jeffrey Liss said. "Our long-range programme is to settle the moon and Mars as soon as possible." 2664 !GCAT !GPOL !GVOTE Here are some key facts about the August 26-29 Democratic National Convention that will nominate President Bill Clinton as the party's candidate for the Nov. 5 presidential election. Number of delegates: 4,329, chosen in primaries and caucuses in each state and U.S. territory. Number of delegates needed to nominate Clinton: 2,165. When nomination will occur: Wednesday, Aug. 28, during a roll call of states and territories. Location: United Centre, a $175 million sports arena on Chicago's near West Side, a poverty-stricken, crime-riddled area. The arena holds more than 20,000 people. Schedule: -- Monday, Aug. 26: Convention opens 4 p.m. CDT (5 p.m. EDT)(2100 GMT) for afternoon session; evening session begins 7 p.m. CDT (8 p.m. EDT)(0001 GMT), ends at 10 p.m. CDT (11 p.m. EDT)(0300 GMT). Highlights: presentation by actor Edward James Olmos; remarks by actor Christopher Reeve. -- Tuesday, Aug. 27: Convention activities begin 3:30 p.m. CDT (4:30 p.m. EDT)(2030 GMT); evening programme begins 7 p.m. CDT (8 p.m. EDT)(0001 GMT), ends at 10 p.m. CDT (11 p.m. EDT)(0300 GMT). Highlights: remarks by Rev. Jesse Jackson, first lady Hillary Rodham Clinton. -- Wednesday, Aug. 28: Convention activities begin 3:30 p.m. CDT (4:30 p.m. EDT)(2030 GMT); evening programme begins 7 p.m. CDT (8 p.m. EDT)(0001 GMT), ends at 10 p.m. CDT (11 p.m. EDT)(0300 GMT). Highlights: Nomination of President Bill Clinton; address by Vice President Al Gore. -- Thursday, Aug. 29: Convention activities begin 3:30 p.m. CDT (4:30 p.m. EDT)(2030 GMT); evening programme begins 7 p.m. CDT (8 p.m. EDT)(0001 GMT), convention closes at 10 p.m. CDT (11 p.m. EDT)(0300 GMT). Highlight: Clinton accepts nomination. Convention theme: "Opportunity, responsibility and community." 2665 !GCAT !GPOL !GVOTE Two years after a political meltdown cost the the Democrats control of Congress, President Bill Clinton and his party have much to cheer at their Chicago convention, where they hope to launch Clinton to re-election. Clinton's strong showing in the polls is reason enough for giddiness at the August 26-29 gathering. Although Republican presidential candidate Bob Dole got a bounce from his party's San Diego love-feast, Dole is still playing catch-up. In the history of modern American political polling, no presidential candidate who led in the polls on Labour Day has ever been overtaken. More good news for Democrats is that they are in good shape financially going into the Fall campaign for a change, lifting the spirits of their candidates for Congress and governor. All 435 seats in the House of Representatives, 34 Senate seats and 11 governor's races are up for grabs in the Nov. 5 election. Strangest of all, a party known for its fractiousness is united for once. Clinton is the first sitting Democratic President since Franklin Roosevelt unopposed for re-nomination, and Roosevelt was the last Democratic president to be elected to more than one term. So this year's Chicago convention bears no comparison with its 1968 predecessor, which saw street-fighting between police and demonstrators over the Vietnam War that left the Democrats divided for more than two decades. This would have seemed an impossible dream in late 1994, when the Democrats were dejected and disorganized after a Republican election rout that gave Dole's party control of both houses of Congress for the first time in four decades. Many Democrats bitterly blamed Clinton for the debacle, saying the vote reflected public outrage at his policies on homosexuals, guns and health care reform. But such disparate events as the April 1995 Oklahoma City bombing, when Clinton provided powerful national leadership, and nasty budget battles with the new Republican Congress, helped the self-styled "Comeback Kid" to redefine himself and brought him to where he is now. Convention organisers promise that Clinton's political love-feast will differ from the one staged on Dole's behalf. "Our convention will be managed, but not scripted," Clinton campaign manager Peter Knight said, sniping at Republican manoeuvres to prevent an abortion floor fight. At the same time, Knight vowed that the Democrats would not subject Dole and the Republicans to "the same kinds of insults and character attacks" that Clinton partisans believe was standard fare in San Diego. "We expect this (convention) to be focused on issues, not insults," White House communications director Donald Baer told reporters. Dole himself will campaign in the Chicago area on Sunday, attend a picnic in Palos Park, a southwest suburb about 17 miles (27 km) from the convention arena. Clinton will arrive in Chicago on Wednesday after a four-day train trip through the country's mid-section, a battleground in his contest with Dole and independent Ross Perot. Along the way, he will make a string of what the White House hopes will be headline-grabbing policy announcements about crime, education and the environment, all issues that resonate with the voters. As the convention awaits its nominee, the delegates will get a steady diet of convention oratory. Primetime speakers include keynoter Evan Bayh, the Democratic governor of Indiana; Hillary Rodham Clinton and Vice President Al Gore. 2666 !GCAT !GCRIM A vegetarian bus driver's civil rights were violated by a municipal bus company that fired him for refusing to hand out free hamburger coupons, a federal agency has ruled. "This is a wonderful day for me and vegetarians everywhere because we are being taken seriously," Bruce Anderson said in a statement on Friday. California's Orange County Transit Authority dismissed Anderson in June after he chose not to give passengers coupons from a fast-food chain that runs ads featuring sandwiches oozing sauce. The U.S. Equal Employment Opportunity Commission issued a written "determination" this week charging that the transit authority discriminated against the driver for "his strongly held moral and ethical beliefs," and violated his civil rights. Gloria Allred, his lawyer, said the Commission's ruling would add "considerable weight" to a civil lawsuit filed by Anderson. A Commission lawyer declined comment on the charges but said the agency encourages out-of-court settlements. "We would certainly be open to that," said Allred. 2667 !GCAT !GCRIM !GVIO Authorities have started renovating the courtroom to be used exclusively for the Oklahoma City bombing case to accommodate a closed-circuit telecast of the trial, a court official said Friday. The months-long renovation, to cost "much less than $1 million," will alleviate crowded conditions, said U.S. District Court Clerk James Manspeaker. Congress mandated a closed-circuit telecast of the trial to victims in Oklahoma City after the case was moved to Denver. Defendants Timothy McVeigh and Terry Nichols are accused of the April 19, 1995, bombing of the Alfred P. Murrah Federal Building that claimed at least 168 lives. The judge is to set a trial date sometime after an October 2 hearing which will hear arguments from the defence that Nichols and McVeigh should have separate trials. 2668 !C12 !CCAT !GCAT !GCRIM A U.S. federal judge on Friday granted a preliminary injunction to stop the reorganization plan of the insurance market by Lloyd's of London from going forward. U.S. district court judge Robert Payne ruled that the 93 U.S. investors who filed the case would suffer irreparable harm if the preliminary injunction was denied. "The defendant's (Lloyd's) motion to dismiss is denied and the plaintiff's motion for preliminary injunction is granted," the judge said in his written ruling. The judge also said the injury the 93 plaintiffs and other American investors would suffer significantly outweighed any harm to Lloyd's of complying with its obligations under the securities laws of the United States. Investors, whom Lloyd's calls Names -- individuals who pledge their assets to back the insurance policies sold at Lloyd's -- had sought to block the reorganization plan, whereby Lloyd's would reinsure billions of dollars in liabilities by creating a new reinsurance company, Equitas. The ruling effectively blocks the creation of Equitas. Lloyds lawyers refused to comment after the ruling but the insurance group is expected to appeal the court decision. Under the plan, the investors were being asked to pay up to $150,000 each to help fund Equitas, which would take responsibility for $12.4 billion in losses from asbestos, pollution, and disaster claims between 1988-92. It's investors had been due to vote on the plan on Aug. 28. The U.S. investors claimed Lloyd's declined to provide detailed financial information about Equitas as required under U.S. securities laws. Judge Payne said the investments in Lloyd's were "securities" in part because Lloyd's has more than 500 Names and total assets of more than $10 million. "Lloyd's is in violation of the securities exchange act and that in seeking Names' consent to the settlement offer dated July 26, 1996, Lloyd's is using the U.S. mail and other means or instrumentalities of interstate commerce to solicit a proxy or consent or authorization from the plaintiff and the other American Names in contravention of rules and regulations promulgated by the Securities and Exchange commission," Judge Payne ruled. The plaintiffs' lawyers had argued during hearings on Monday and Tuesday that the plaintiffs needed more information before agreeing to the complex recovery plan that would use their own investment to settle nearly $5 billion in insurance losses. They claimed Lloyd's should have to comply with U.S. federal or state securities laws which enforces strict disclosure rules. 2669 !GCAT !GPOL Under Secretary of State for Management Richard Moose resigned his post on Friday to return to the private sector, the State Department said. Moose planned to join the Council on Foreign Relations early next month where he would lead a comprehensive private study of foreign policy resource needs, spokesman Glyn Davies said in a written statement. In accepting the resignation, Secretary of State Warren Christopher noted that Moose had made "critical contributions" during his three years at the department, Davies said. "The secretary emphasised in particular initiatives launched by Under Secretary Moose, including a new system for allocating overseas costs among the foreign affairs agencies and the development of a strategic plan for management of information technology," he said. Assistant Secretary for Administration Patrick Kennedy would serve as acting Under Secretary for Management, the statement added. 2670 !GCAT !GCRIM !GDIP A U.S. appeals court ruled that torture victims of former Philippine president Ferdinand Marcos could not include assets of the current Philippine government in an award drawn from Marcos' estate, court documents said. The Ninth Circuit of the U.S. Court of Appeals in San Francisco made the ruling on Thursday. The case was heard in the United States because Marcos spent his final years in exile in Hawaii until his death in 1989. Victims of torture and families of people executed during Marcos' imposition of martial law from 1972 to 1986 had won a damage award of $2 billion in a class action suit ruling two years ago by a U.S. District Court in Hawaii. The victims later won an injunction freezing the worldwide assets of Marcos' estate to recover the $2 billion. The victims' suit asked the court to include the Republic of the Philippines in the injunction, claiming it was "an aider or abettor of the Estate." The U.S. District Court ruled in favour of the victims and included the current government in the injunction. But the Philippine goverment appealed the ruling, claiming it had "sovereign immunity" from such claims. The U.S. appeals court ruled that the current Philippine government was protected from such injunctions by a doctrine of soveriegn immunity found in the U.S. Foreign Sovereign Immunities Act. Moreover, the appellate court said an injunction against a foreign goverment would be futile because the court could not enforce it without "personal jurisdiction," which it lacks under the Immunities Act. The victims claimed the government had seized $672 million in assets from Marcos' estate and sold $481 million in stock held in trust for the estate. 2671 !GCAT !GCRIM !GPRO The judge in the O.J. Simpson civil trial on Friday ordered a complete blackout of television and radio coverage, saying he did not want a repeat of the "circus atmosphere" that surrounded the former football hero's criminal trial on murder charges. Judge Hiroshi Fujisaki said the TV camera in Simpson's first trial had "significantly diverted and distracted the participants, it appearing that the conduct of witnesses and counsel were unduly influenced by the presence of the electronic media." "This conduct was manifested in various ways, such as playing to the camera, gestures, outbursts by counsel and witnesses in the courtroom and thereafter outside of the courthouse, presenting a circus atmosphere to the trial," he said. In banning electronic and visual coverage of the civil proceedings, Fujisaki was apparently seeking to cut down on the media frenzy that surrounded Simpson's criminal trial. Simpson was acquitted last October of the 1994 murders of his ex-wife Nicole Brown Simpson and her friend Ronald Goldman. The victims' families are now suing Simpson for damages in a wrongful-death civil lawsuit, charging that he was responsible for the deaths of their loved ones. Trial is set to begin on Sept. 17. Live, gavel-to-gavel TV coverage of the first trial kept the nation enthralled for nine months. In his ruling on Friday, Fujisaki stated: "The intensity of media activity in this civil trial thus far strongly supports this court's belief that history will repeat itself unless the court acts to prevent it." Fujisaki also ruled that no still photographers or sketch artists would be allowed in the courtroom for the civil case, saying, "It has been the experience of this court that the presence of a photographer pointing a camera and taking photographs is distracting and detracts from the dignity and decorum of the court." Fujisaki's ruling even extends into the Internet. The judge said he would not allow live transcripts typed by the official court reporter to be transmitted onto the Internet as they were during the criminal trial. He said the transcripts were "rough, unedited or uncorrected notes...which may be incomprehensible or misleading or otherwise incomplete." Fujisaki also left largely intact a wide-ranging gag order prohibiting lawyers, witnesses and anyone else connected with the case from talking about it in public. He said he would shortly issue an order that any proceedings out of the presence of the jury or at sidebar would be sealed until the end of the trial. Paul Hoffman, an attorney representing the American Civil Liberties Union who had earlier urged Fujisaki to lift the gag order, said he would appeal the judge's decision to keep it in place. "We believe that the judge is not really on solid ground and we hope that the Court of Appeals will overturn it (the gag order). From the standpoint of the First Amendment (right to free speech) it's a sad day," he said. Earlier in the day, Fujisaki listened to six lawyers representing the families of Nicole Brown and Goldman, as well as to Hoffman and Sager, arguing why there should be a TV camera in the courtroom. Simpson's attorney, Robert Baker, was the sole dissenting voice, arguing against live television coverage. 2672 !GCAT !GCRIM !GDIP !GPOL !GREL !GVIO France on Saturday deported a first group of four Africans seized in a police raid on a Paris church despite outrage by leftist opposition parties, street protests and appeals by lawyers. An Airbus A310 jet took off from a tightly-guarded military base at Evreux, west of Paris, at 7 p.m. (1700 GMT) as more than 100 demonstrators against strict immigration laws jeered at the base's gates. Four of 210 Africans arrested in the Saint-Bernard church in Paris by police using batons and tear gas on Friday were aboard the flight, bound for Mali, Senegal and Zaire, the Interior Ministry said in a statement. A further 53 Africans from the three countries, facing previous expulsion orders, were also aboard the jet, it said. France's centre-right government has vowed to clamp down on illegal immigration, chartering 22 previous flights in recent months for deportations of thousands of Africans. Saturday's was the first using a military base after anger over the raid on the church, where 10 people were on a 50-day hunger strike against expulsion orders. Demonstrators at Evreux sought in vain to block a long police convoy including the Africans from entering the base, guarded by troops and riot police. One person needed hospital treatment after scuffles with police. Lawyers for the Africans had also launched a string of appeals against expulsions. Leftist opposition said the raid damaged France's image as a cradle of human rights. In France's second city of Lyon, several hundred people marched peacefully on Saturday urging the government to give all the Africans residence permits. Riot police had clashed with protesters in Paris late on Friday night. Many of the 210 Africans detained, including all the children and almost all the women, were freed on Friday. The Interior Ministry statement said that 40 of them would get residence permits. Other Africans, including the hunger strikers, were still being held. The public prosecutor said a doctor had concluded their health was not giving cause for concern. "The examination (of the Africans' calls for residence permits) case by case is continuing, as the government has promised," the Interior Ministry statement said. Officials at Prime Minister Alain Juppe's office said the government aimed to soften the implementation of strict 1993 immigration laws, which have left many immigrants in a legal limbo by outlawing some who were previously legally in France. One said the government wanted to stress greater "efficiency" and "humanity" in applying the laws. A group defending foreigners expelled from France, Cimade, said only about 50 of those originally arrested were still in detention on Saturday after a string of sometimes mysterious releases. One spokesmen for the Africans, Mauritanian Doro Traore, told the daily Liberation that he and another man were driven out of Paris by police and unceremoniously dumped in a wood on Friday. They hitched their way home. Jean-Pierre Weber, head of Cimade, said those released had either gone to their families in France or to shelters set up by human rights groups. But he said all were confused and none were sure if they would get residence permits. French President Jacques Chirac, who has not commented publicly on the arrests, was meeting Juppe at the president's summer retreat on the Riviera for a weekend of talks. 2673 !CCAT !GCAT !GDIS A Japanese fishing vessel drifted off the Irish coast on Saturday while its crew tried to clear the engineroom of a leaked gas which killed five crewmen. Irish defence officials said a makeshift funnel had been built in the engineroom to try to clear it of the gas which seeped out of a refrigerating unit. They said no effort would be made to restart the engines of the Taisei Maru until its engineroom was clear. Once it regained power it was expected to head for the regional capital of Cork where its agents are based, to deal with the five bodies, the defence officials said, The vessel drifted in heavy seas 240 miles off the Irish coast in the company of a fleet of about 40 Japanese fishing boats. The flotilla has been under scrutiny from the Irish navy, which suspects it of illegal fishing in Ireland's 200-mile waters. A second Japanese captain appeared in a West Cork court at Bantry on Saturday to face charges of illegal fishing and entering the "Irish Box" national waters. His name was not immediately known. He skippered the Shoshin Maru, which was escorted to the port of Castletownbeare where it joined the Minato Maru, which was detained earlier this week. Its captain has pleaded not guilty to three counts of illegal fishing. Both vessels were apprehended in a crackdown on illegal fishing in Ireland's Atlantic in which a total of 29 trawlers have been detained this year. The captain of the first vessel was ordered to post bail of close to 300,000 Irish pounds ($450,000), an amount equivalent to the tackle and catch seized plus the cost of legal proceedings. His ship had some eight tonnes of tuna in its hold. The fish is highly prized by consumers in Japan but is not commercially fished in great quantities by Ireland. The Japanese fleet is hovering outside Irish waters but is using long-line tuna tackle, miles of baited hooks which is cast overboard for surface-feeding fish and picked up later. 2674 !GCAT !GCRIM !GDIP France looked set on Saturday to deport a group of Africans seized in a raid on a Paris church despite a barrage of appeals by defence lawyers against bitterly-disputed immigration laws. A heavily-guarded convoy carrying an unknown number of the Africans arrived at a military airbase in Evreux, west of Paris, in late afternoon. The convoy had left from a detention centre in Vincennes on the east side of Paris. The Africans holed up in the Saint-Bernard church in central Paris to protest against efforts to deport them were arrested on Friday morning after police using batons and tear gas smashed their way in. Hundreds of people demonstrated outside the Evreux base on Saturday after reports that a DC-10 plane was being readied to deport several dozen of the 210 people, including 53 women and 68 children, seized on Friday. The Africans, mostly from Mali, Senegal and Zaire, included 10 on a 50-day hunger strike against previous expulsion orders made under stiff 1993 immigration laws. A spokesman for the group said the hunger strikers had continued their fast. Lawyers for the detained Africans lodged a string of appeals with a judge at an administrative tribunal against their arrests, and complained they had been denied access to them. "We want (the judges) to note that there were numerous violations of the law yesterday," said Gerard Tcholakian, a lawyer for the Africans. Late on Friday night, riot police again used tear gas to disperse stone-throwing protesters demonstrating outside the detention centre in Vincennes. Several people were treated for cuts but there were no reports of serious injuries. A group defending foreigners expelled from France, Cimade, said only about 50 of those originally arrested were still in detention on Saturday after a string of sometimes mysterious releases. A spokesmen for the Africans, Mauritanian Doro Traore, told the daily Liberation that he and another man were driven out of Paris by police and unceremoniously dumped in a wood on Friday. They hitched their way home. Children and women looking after them were all freed on Friday, police said. The government had said that perhaps 30 to 40 percent of the detainees might be granted residence permits. Jean-Pierre Weber, head of Cimade, said those released had either gone to their families in France or to special shelters set up by human rights groups, but added that they could not feel secure. "Things are completely unclear because no decision has been taken about them...they are once again without (residence) documents," he said. French President Jacques Chirac, who has not commented publicly on the arrests, was meeting Prime Minister Alain Juppe at the president's summer retreat on the Riviera on Saturday for a weekend of talks. Most French newspapers criticised the raid, along with left-wing parties and unions. "For the authorities this is a Pyrrhic victory. Wanting to please their electorate, Jacques Chirac and Alain Juppe forgot public opinion," the left-leaning Liberation said. The 1993 laws have left many immigrants in a legal limbo, outlawing some who were previously living in France legally. 2675 !GCAT !GDIP !GVIO France has expelled a first group of Africans seized in a police raid on a Paris church, with Prime Minister Alain Juppe struggling to reconcile a crackdown on illegal immigrants with pledges of greater humanity. Four Africans out of 210 arrested in the Saint-Bernard church on Friday morning were deported on a charter plane with 53 other illegal immigrants bound for Mali, Senegal and Zaire on Saturday evening from a military airbase west of Paris. Several dozen others, including 10 on the 50th day of a hunger strike when riot police smashed down doors and windows to break into the church with batons and teargas, were still in detention on Sunday. All children and most women were freed. Defence lawyers said they would continue arguments in court on Sunday aimed at averting threatened new deportations. Lawyers said they had lodged a total of 316 different legal appeals on behalf of the Africans. Balancing the crackdown, the Interior Ministry said 40 of those seized in the church would be granted residence permits in coming days "due to family or health situations". The Africans had demanded residence rights for all. The church raid triggered protests against the centre-right government and clashes between stone-throwing protesters and riot police in Paris on Friday night. Outside Evreux airbase, from where the Airbus A310 carrying the Africans home took off on Saturday, more than 100 people scuffled with police. One civilian, hurt in a police charge, was taken away by ambulance. Officials at Juppe's office said the conservative prime minister was willing to soften implementation of tough 1993 immigration laws, long slammed by the left-wing opposition, human rights activists and immigrants as unworkable. They said Juppe, meeting President Jacques Chirac in the president's Riviera retreat for a weekend of talks, wanted to make the laws more "efficient" and more "humane". Similar words were used by the government before Friday's raid. Saturday's plane was the 23rd charter plane since the government took office in May 1995, vowing to crack down on illegal immigrants. The 1993 laws, named after former interior minister Charles Pasqua, are a tangle partly because some immigrants, such as parents of children born in France since 1993, can now neither be expelled nor obtain residence permits. Former Socialist prime minister Michel Rocard said: "The government...is dishonouring our country. The Pasqua law is both cruel and incoherent. It must be changed, it's this law which is causing these horrors." Pasqua is a member of the conservative Rally for the Republic Party (RPR) headed by Juppe and founded by Chirac. Political analysts say the government has no interest in a full-blown overhaul of the laws. Being tough against immigrants is popular with many right-wing voters in the run-up to 1998 elections, especially at a time of record unemployment in France. Integration Minister Eric Raoult set the tone on Friday night: "Charles Pasqua's laws are a cornerstone which perhaps will have to be adapted in the years to come. But we must start by enforcing them." 2676 !GCAT !GVIO France on Saturday handed a suspected member of the Basque separatist group ETA to Spanish authorities, French Interior Ministry officials said. Ignacio Olascoaga Mugica, who had just ended a prison sentence in France, is suspected of having taken part in several guerrilla attacks in Spain. ETA (Basque Homeland and Freedom) has killed about 800 people in its campaign for an independent Basque state since the 1960s. 2677 !GCAT !GCRIM !GDIP !GPOL France deported a group of Africans from a military airbase on Saturday after police seized them in a bitterly-contested raid on a Paris church, witnesses said. A plane took off from the Evreux base west of Paris at 7 p.m. (1700 GMT) after police drove an unknown number of the Africans in a tightly-guarded convoy from a detention centre near the capital. Most of the 210 people originally arrested are from Mali, Zaire and Senegal. The Airbus A310 jet's destination was unknown. A group of demonstrators had sought in vain to block the convoy from entering Evreux airport, guarded by troops and riot police. Lawyers for the Africans had also launched a string of appeals against expulsions. Many of the 210 Africans detained, including women and children, had been freed since the police raid on the Saint-Bernard church early on Friday with batons and tear gas. Other Africans, including 10 men on a 50-day hunger strike against existing expulsion orders, were still being held. The leftist opposition said the raid damaged France's image as a cradle of human rights. 2678 !GCAT !GPOL !GVOTE Algeria's presidency and opposition parties have drawn up an election law to introduce proportional representation instead of the two round majority system that brought Islamists close to power five years ago and violence when when the vote was cancelled. "Twenty-nine political parties and presidency's reprentatives unanimously agreed on the new text of the election law after nine days of debate," an opposition party spokesman involved in preparing the draft said on Saturday. Political parties and government representatives earlier this week also drafted a law that would ban Islamists parties. The two-round majority election system was blamed by anti- Islamists for helping Moslem fundamentalists win local elections in 1990 and a first round of general elections. The cancellation of a general elections in January 1992 started civil strife in which an estimated 50,000 people have been killed. The new proposed draft law was wrapped up on Saturday by the parties and presidency representatives, said the spokesman, speaking by telephone from Algiers. Their committee was one of four working groups set up 10 days ago to hammer out details of a broad consensus over President Liamine Zeroual proposed reforms. Zeroual plans to hold a national conference, likely in mid-September, followed by a referendum to amend the constitution this year and hold general elections in 1997. The new election law will enable an estimated one million Algerian expatriates to vote, officials said. "The draft law was drawn in order to ban politicians from seeking more than one mandate and widen Algeria's political representation...It also will open the gate for many Algerians to enter politics," said one official. The law drawn up on Thursday to tighten rules on political parties' activity and to ban Islamist parties will give current legal parties, including two Islamist groups, one year in which to change their focus or founding principles in order not to run foul of the law. The mainstream radical Islamic Salvation Front (FIS) was outlawed in 1992 after violence followed the cancellation of the election in which it had taken a commanding lead. But Algeria still has two legal Islamist parties, Nahda and Hamas. A joint committee on tidying up the consitution also reached agreement on Thursday that Islam is Algeria's state religion. The secular opposition Socialist Forces Front walked out this month from Zeroual's talks, although the former sole ruling party, the National Liberation Front (FLN), took part. The outlawed FIS was excluded. The new draft laws will be submitted to Zeroual before being sent to a government-appointed Transitional National Council to be approved. Prime Minister Ahmed Ouyahia gave an upbeat assessement of the last details of the dialogue: "Algeria is about to overcome this stage (of crisis) in harmony and concord through elections in the near future. The positive results coming daily from the multilateral committees confirm this fact," Ouyahia, quoted by the official Algerian news agency APS, told economic officials on Saturday. 2679 !GCAT !GPOL French President Jacques Chirac's popularity climbed slightly in August but voters remain disaffected by economic austerity and high unemployment, an opinion poll showed on Saturday. The IFOP survey, for the Journal du Dimanche weekly, showed 38 percent of those asked were satisfied with the conservative president's performance against 50 percent dissatisfied. In July, the split was 35-53. Prime Minister Alain Juppe, meeting Chirac on the French Riviera on Saturday, fared slightly less well. The number of satisfied voters climbed one point to 31 percent in July while those unhappy with his performance fell to 57 from 59. Other surveys have shown that voters blame the two men for a weak economy and reckon that Chirac, who came to power in 1995 promising a war on unemployment, has not done enough for the jobless. The poll was taken among 936 people on August 22 and 23, the day French riot police arrested 210 African migrants in a Paris church where they were resisting expulsion orders. 2680 !GCAT !GDEF !GDIP Defence Minister Volker Ruehe said that German troops would stay on in Bosnia next year as part of an international force to ensure the establishment of peace, a newspaper reported on Saturday. The current NATO-led peace force (IFOR) in Bosnia is due to return home at the end of the year. But Ruehe told Bild am Sonntag in an interview that a "new and different mandate" for the troops would be agreed on for next year after the current mandate expires in December. "After the (Bosnian) elections (on September 14) the troops will start being reduced from the beginning of October from 60,000 to about 20,000. A completely new and different mandate will be agreed for next year," Ruehe said. "The defence ministers will begin negotiations for this at the beginning of September at a NATO meeting," he told the newspaper in an interview, excerpts of which were released ahead of publication on Sunday. "But we must avoid giving the impression this peace deployment in former Yugoslavia is being perceived in the long run as an occupation. On the other hand we must prevent any return of war and massacres" he said. 2681 !GCAT !GODD !GPOL A group of Italian comics hope the joke will be on separatist leader Umberto Bossi next month when they lead the ancient Etruscan town of Orvieto in a mock split from Rome. Orvieto mayor Stefano Cimicchi said the comics, including popular actor Roberto Benigni, would declare Orvieto "capital of Etruria" on September 15 -- the day Bossi plans a march across the north in favour of independence from Rome. "We will then proceed with the annexation of Sardinia, Corsica and Cyprus," Cimicchi told reporters on Saturday. He said the city council would be "ironically present" when the comics made their proclamation on the same day Bossi has threatened to declare the birth of Padania, the name he has given to northern Italy. Orvieto, located in Umbria between Rome and Florence, was once the capital of Etruria, an ancient federation of 12 Etruscan towns. "We want to pop some air out of this balloon of tension that has been blown up around September 15," Cimicchi said. "We want to help turn down the rhetoric in a country that borders former Yugoslavia yet in which people are still talking about secession," he added. Bossi has intensified his separatist rhetoric since his Northern League party's good showing in last April's general election, when it took 10 percent of the vote nationally. He has recently dropped a drive for federalism, saying secession from Rome's wasteful and centralised bureaucracy is the only solution for northerners. 2682 !GCAT !GDIP !GVIO Germany's Foreign Minister Klaus Kinkel, facing opposition demands to break off ties with Iran, said on Saturday he would study evidence that Tehran ordered the killing of Iranian dissidents on German soil before acting. Former Iranian president Abolhassan Banisadr told a German court trying five men for the 1992 restaurant murder of three Iranian Kurds and their translator that the orders for the murder came from top Iranian officials. In an interview with a Berlin radio station Kinkel, one of the main proponents of Bonn's much-criticised policy of openness towards Iran, said he planned to study the court transcripts before drawing conclusions. Opposition Social Democrat parliamentarian Wilfried Penner urged the government to break off diplomatic ties with Iran immediately in the light of the Berlin murder trial. In an interview with a German regional radio station Penner said that Bonn should act quickly in case it emerged from the trial that Tehran really had ordered the machinegun killings at a Berlin restaurant. Banisadr told a heavily-fortified Berlin court on Thursday and Friday that Iran's spiritual leader Ayatollah Ali Khamenei and top Iranian government ministers ordered the deaths with President Akbar Hashemi Rafsanjani's blessing. "Of course we must evaluate what Banisadr said in the trial. And of course this is something which must be of significance to the type of relations we have with Iran," Kinkel said. "I don't want to draw any hasty conclusions or make premature judgements in any form whatsoever, above all because I can not and do not want to interfere in the trial," he said. "I prefer to keep to the facts," said Kinkel, whose controversial policy of "critical dialogue" with Iran has drawn severe criticism particularly from Washington. Tehran has consistently denied all involvement in the Berlin assassinations. But German authorities issued an arrest warrant in March for Iran's Intelligence Minister Ali Fallahiyan in connection with the killings. It is not the first time Bonn's policy towards Iran has caused embarrassment for foreign minister Kinkel. Last year he was forced to cancel an Islamic conference in Bonn after the German parliament voted to bar Foreign Minister Ali Akbar Velayati following his comments welcoming Israeli Prime Minister Yitzhak Rabin's assassination in November. 2683 !GCAT !GCRIM An Italian farmer accused of multiple homocide has confessed to mutilating the bodies of four women after having sex with them, the Italian news agency ANSA reported on Saturday. It quoted the lawyer of Gianfranco Stevanin as saying the 35-year-old farmer confessed on Friday to a Verona magistrate that he had killed and mutilated the women. ANSA said Stevanin was unable to recall how he had killed the women, remembering only that he had found them "lifeless in his arms" after having sadmasochistic sex with them. Stevanin, arrested in 1994 and jailed for three years for assaulting an Austrian prostitute, is accused of murdering five women, three of whose bodies were found near his villa outside Verona between July and December 1995. Two of the corpses were identified but not the third, found headless and decomposed in a sack in a nearby canal. Lawyer Cesare dal Maso told ANSA that Stevanin confessed to beheading and dumping the body of a fourth woman in the nearby Adige river. Dal Maso declined to comment on the alleged fifth murder, saying only that "the interrogations are not over yet" with investigators. It said investigators believed Stevanin had suffocated them by putting plastic bags on their heads. Stevanin was first sentenced for assault but investigators began digging in the garden of his villa after the first body was found by a passer-by. 2684 !GCAT !GCRIM Belgian police searched two more houses on Saturday for bodies in a child-sex scandal of murder, kidnapping and pornography that has sent a shockwave of revulsion throughout Europe. Recriminations built up over how the scandal's central figure, convicted child rapist Marc Dutroux, managed to prey on children unhindered for so long. In just over a week two young girls have been found dead, from starvation, two have been freed from a dungeon-like secret compartment and an international hunt has started for at least two others. On Saturday investigators with dogs trained to find bodies searched one house at Ransart and one at Mont-sur-Marchienne -- both suburbs of the southern city of Charleroi. Both houses are owned by Dutroux. Belgian media speculated that Dutroux, charged with abduction and illegal imprisonment of children, must have had high level protection to molest youngsters. They put forward no proof to support the speculation, but seized on a comment by chief prosecutor Michel Bourlet on Belgian television on Friday night that he would chase down everyone involved in the case "if I am allowed to". Bourlet said between 300 and 400 paedophile porn video tapes had been seized, some of which featured Dutroux. Dutroux was charged a week ago after police rescued two young girls from a concrete dungeon in the basement of one of the six houses he owns in and around Charleroi. Just a day later the national euphoria at the rescue turned to disgust as Dutroux led police to the bodies of two eight-year-old girls in another of his houses. Julie Lejeune and Melissa Russo, had been kidnapped in June last year. Dutroux said they starved to death nine months later. He also admitted kidnapping two other girls, An Marchal and Eefje Lambrecks, a year ago. The fate of the girls is unknown, but there has been speculation they were sold into prostitution in Slovakia or the Czech Republic where Dutroux was a frequent visitor. Belgian police have visited Bratislava and will visit Prague. Five other people have been arrested including Dutroux's second wife Michelle Martin, charged as an accomplice. The others have been charged with abduction and illegal imprisonment of children or are suspected of criminal association. Dutch police are also holding a 74-year old Dutchman in connection with the disappearance of An and Eefje, although a spokesman said no direct link had yet been established. At least part of the speculation in the Belgian media of high-level protection for Dutroux and his accomplices is based on leaked documents cataloguing a high degree of police bungling, incompetence and indifference. Among the revelations are the fact that the gendarmerie was running a surveillance operation codenamed "Othello" against Dutroux in 1995 -- when both Julie and Melissa and An and Eefje were kidnapped. They show that the gendarmes were aware that Dutroux was building cells in some of his houses for holding children, yet this information was either not passed on to other police forces searching for the missing girls or was overlooked when it was. They also show that police investigating a theft visited Dutroux late last year at the house where Julie and Melissa were being held but accepted his word that the children's cries they could hear came from neighbours. Justice Minister Stefaan De Clerck has admitted that mistakes were made and ordered an inquiry at the same time as stressing there were no indications of a cover-up. There is also widespread disbelief that no one appeared to question how Dutroux, an unemployed father of three with no visible means of support, managed to own six houses. 2685 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Germany's leading retailer Rewe Handelsgruppe AG said on Saturday it would take on 1,000 new trainees in 1996, in addition to the 1,700 training places originally planned. The group said it already had 4,000 trainees. Rwe has 9,000 stores, 168,000 employees and annual turnover of over 48 billion marks. --Frankfurt Newsroom +49 69 756525 2686 !GCAT !GPOL Far-right Austrian politician Joerg Haider was quoted on Saturday as saying he might step down as leader of the opposition Freedom Party before general elections in three years time. Haider, a controversial figure who once praised Hitler's labour policies, told the Vienna daily Die Presse he might not stand for the leadership when the job comes up for renewal in 1998, one year before the end of the present government's four-year term. "I have led the party for 10 years and it has not always been an easy task," said Haider, who has established a strongly nationalist, anti-immigration platform. "I may well try and persuade party members to vote for somebody else for a change." Haider, 46, took over as parliamentary leader of the Freedom Party in September 1986, transforming it from a centrist grouping with little support to a nationalist movement with a growing voter base. His anti-immigration, Austria-first policies have struck a chord with voters weary of the established coalition government of Social Democrats and conservative People's Party, though his outspoken style has often drawn criticism from opponents. In 1991 Haider was forced to resign as provinical governor of Carinthia after praising Adolf Hitler's labour policies and in 1995 he had to backtrack after referring to Nazi extermination camps as "punishment camps". Just two days ago Austrian state prosecutors said they were taking legal action against the nationalist leader over comments he made last year about Interior Minister Caspar Einem. And police confirmed earlier this month they were investigating a former Freedom Party candidate in connection with the vanadalism of a Jewish cemetery in the south-east Austrian city of Eisenstadt four years ago. "It's election time and whenever a vote is coming up the establishment rallies to make sure the governing parties survive," Haider said, referring to European Union elections on October 13 and crucial Vienna polls on the same day. Recent voter surveys have given the Freedom Party 24 percent support, up from 22 percent in last December's general election. If intentions translate into votes, Haider's party could replace the People's Party as Austria's second most popular grouping. On Saturday Haider appeared full of confidence ahead of the European Union vote and he renewed his attack on what he considers to be unnecessary bureaucracy in Brussels. "We are not opponents of European cooperation but we want to see the EU redimensioned. Its unwieldy structure...is not workable and there will have to be a move towards more national self-government," he said. 2687 !GCAT !GDIP !GVIO Germany's Defence Minister Volker Ruehe has urged Moscow to establish lasting peace in Chechnya -- otherwise its ties with the West might "drown in a sea of blood", a newspaper reported on Saturday. Ruehe said in an interview with Bild am Sonntag that Russia was an important ally for Germany and other members of the North Atlantic Treaty Organisation (NATO). But Ruehe warned that a "strategic partnership" was only possible once Moscow established enduring peace at home. Excerpts of the interview were released ahead of publication on Sunday. His call came as Russia began withdrawing troops from the Chechen capital Grozny, bringing security chief Alexander Lebed's peace plan a few steps closer to reality. "(The) Chechnya (conflict) must be resolved with lasting peace. For the partnership (with Russia) cannot be drowned in a sea of blood," Ruehe told the German newspaper, referring to NATO's Partnership for Peace programme (PfP). PfP is aimed at forging closer links with between former members of the Warsaw Pact in Eastern and Central Europe and NATO members by organising joint military exercises and for joing training programmes. Earlier this week a senior German diplomat visiting Moscow used the opportunity to press home Bonn's growing alarm about the situation in breakaway Chechnya and urge Russia to halt its military campaign there. 2688 !GCAT !GCRIM A man sought by Italy for suspected involvement in Mafia activities was arrested at Amsterdam's Schiphol airport, a Justice Ministry official said on Saturday. Dutch police detained the man known only as Antonio de la T., on Wednesday after an arrest warrant was issued by Italian authorities, a spokeswoman said. "He is wanted in Italy for involvement with drugs and firearms," she said. After his arrest, airport police handed De la T. over to the ministry in Haarlem, where he was now in jail, pending an extradition request from Italy, the spokeswoman said. No one at the Italian embassy in The Hague was available for comment. She said Antonio was the brother of Augusto de la T., arrested at Schiphol in June after being found travelling under a false passport. He is also wanted for Mafia-type activities. Augusto de la T.'s extradition order, confirmed at the time by the Italian embassy, named him in connection with a planned attack on an Italian state prosecutor, possession of illegal firearms, blackmail and arson. 2689 !CCAT !GCAT !GDIS A stricken Japanese fishing boat on which five crewmen were killed by a gas leak was expected to head for the southern port of Cork on Saturday for repairs, rescue officials said. They said an Irish naval vessel, the LE Aisling, was standing by the Taisei Maru off Ireland's Atlantic coast while its crew tried to disperse gas which leaked from a refrigerator, killing five people and injuring one. The trawler was one of a fleet of 40 Japanese fishing boats being shadowed by Irish naval vessels protecting the country's 200 mile "Irish Box" waters from illegal fishing. A party from the LE Aisling was expected to board the Taisei Maru later on Saturday to assess the situation and see what help was needed, the officials said. The Taisei Maru was expected to be in Cork late on Sunday afternoon but it was not clear if it would be towed there or power itself to the southern regional capital. It had a crew of 21 at the time of the accident. It was not known whether the bodies would be repatriated or would remain on board the vessel. Two vessels have been detained on suspicion of illegal fishing and the captain of one, the Minato Maru, pleaded not guilty to three charges when he appeared in court in Bandon, near Cork, on Friday afternoon. He was freed on bail. The captain of a second vessel, the Shoshin Maru, was expected to appear in another court at Bantry, southern Ireland, on Saturday afternoon to face similar charges. Both vessels were apprehended in a crackdown on illegal fishing in Ireland's Atlantic in which a total of 29 trawlers have been detained this year. The captain of the first vessel was ordered to post bail of close to 300,000 Irish pounds ($450,000), an amount equivalent to the tackle and catch seized plus the cost of legal proceedings. His ship had some eight tonnes of tuna in its hold. The fish is highly prized by consumers in Japan but is not commercially fished in great quantities by Ireland. The Japanese fleet is hovering outside Irish waters but is using long-line tuna tackle, miles of baited hooks which is cast overboard for surface-feeding fish and picked up later. 2690 !GCAT !GVIO An Algerian newspaper on Saturday put at seven -- two women and five children -- the death toll of a bomb blast in a market west of Algiers on Friday. Algerian security forces said on Friday three women and two children were killed and five people wounded when a home-made bomb exploded at a market in the coastal town of Bou Haroun, 65 km (40 miles) west of Algiers. The security forces also said a man carrying an explosive device also died after it went off prematurely. El-Watan paper said the blast killed seven -- a mother and her 25-year-old daughter, four young boys and a five-year-old girl. Several people were also wounded, it said. The explosion was the latest in series of bomb attacks in Algeria's four-year-old civil strife. The government-appointed watchdog, Human Rights National Observatory, was quoted this month by local newspapers as saying about 1,400 civilians have died in bomb attacks blamed on Moslem rebels in the past two years. An estimated 50,000 Algerians and more than 110 foreigners have been killed in violence pitting Moslem rebels against government forces since early 1992, when the authorities cancelled a general election in which radical Islamists had taken a commanding lead. 2691 !GCAT !GCRIM Police in Malta said on Saturday they had seized 7.5 tonnes of cannabis concealed in a shipment of chilli sauce on its way from Singapore to Romania. Police commissioner George Grech said the cannabis was found on Friday packed in 500 boxes hidden behind chilli sauce in a container that arrived at Malta Freeport a week ago. The container was on its way to Romania via the former Yugoslavia from Singapore and was the biggest drugs haul in Malta, police said. No street value was given for the cannabis. 2692 !GCAT !GCRIM !GREL !GVIO Lawyers for a group of Africans seized in a controversial raid on a Paris church tried to block expulsions from France on Saturday with a barrage of appeals. Late on Friday night, riot police again used tear gas to disperse stone-throwing protesters demonstrating against immigration laws outside the detention centre in Vincennes on the eastern edge of Paris where the Africans were being held. There were no reports of serious injuries in any of the clashes. The 210 arrested comprised 99 men, 53 women and 68 children. Police said women with dependent children among the Africans seized by riot police wielding batons and teargas on Friday morning were freed after several hours' detention. Some men were also freed after the government said it reckoned 30 to 40 percent would be allowed to stay. Among the 210 people seized in the Saint-Bernard church in Paris were 10 men on a 50-day-old hunger strike. The Defence Ministry declined comment on reports that military planes were being readied to fly several dozen of the Africans home on Saturday, perhaps on a flight being readied for other illegal immigrants. Most seized in the church are from Mali, Senegal and Zaire. Lawyers for the Africans in detention lodged a barrage of appeals with a judge at an administrative tribunal against expulsion orders. The detainees were being held in Vincennes on the eastern edge of Paris. French President Jacques Chirac, who has not commented publicly on the arrest of the Africans, was due to meet Prime Minister Alain Juppe at the president's summer retreat on the Riviera on Saturday for a weekend of talks. The left-leaning daily Liberation blasted the government with a front-page photograph of armed, helmeted police breaking into the church alongside a quote from Interior Minister Jean-Louis Debre promising to act with "humanity and feeling". "For the authorities this is a Pyrrhic victory. Wanting to please their electorate, Jacques Chirac and Alain Juppe forgot public opinion," it said. The conservative daily Le Figaro defended the government, saying it had to uphold the law against illegal immigrants even though the raid revived a row over a tightening of immigration laws in 1993. The centre-right government, backed by a court opinion that none of the Africans in the church had an automatic right to stay in France, has said about 30 or 40 percent of the protesters would qualify for residence permits. Left-wing opposition parties accused Juppe of cynically courting the anti-immigrant National Front, with an eye on 1998 general elections, and of jeopardising France's reputation as a cradle of human rights. The 1993 laws have left many immigrants in a legal limbo, outlawing some who were previously living in France legally. 2693 !GCAT These are the leading stories in the Algerian press on Saturday as reported by the official Algerian news agency APS. Reuters has not verified these stories and does not vouch for their accuracy. LIBERTE - Bomb explodes in market frequented mostly by women, killing five people in Bou Haroun near Algiers. - Joint committees on political reforms end work. AL KHABAR - Foreign Minister Attaf says Algeria is more than a market for France. EL WATAN - Economic and social council holds sixth session in presence of government head Ahmed Ouyahia to underline government strategy on issues including industrial policy and housing. L'AUTHENTIQUE - Banned Islamic Salvation Front leader Abassi Madani's two sons tried in Germany on charges of smuggling arms and explosives. 2694 !GCAT !GDIS A Czech coach crashed and burst into flames on a southern Austrian motorway early on Saturday, killing one person and injuring 15, police said. Austrian television said the coach, which was carrying 45, was en route from the Czech Republic to Italy when the accident occurred near Steinberg, 200 km southwest of Vienna. 2695 !GCAT !GVIO Most Spaniards would support government talks with the illegal Basque separatist group ETA if the rebels renounced violence permanently, a survey published in daily El Mundo on Saturday said. While 57 percent of the population supported negotiations with ETA (Basque Homeland and Freedom), 30 percent opposed it, the survey by the state-controlled Centre for Sociological Studies (CIS) found. But 80 percent said ETA had shown little interest in achieving peace in the Basque country when it offered a one-week truce in July while continuing to hold prison officer Jose Antonio Ortega Lara, kidnapped in January. The problem of terrorism had neither worsened nor improved since the conservative Popular Party (PP) came to power in May, according to 56 percent of those questioned, while 22 percent said it had worsened. The survey questioned 2,496 people between July 17 and 21 and has a margin of error of plus or minus two percent. 2696 !GCAT !GVIO Four bombs exploded overnight on the French Mediterranean island of Corsica in a new wave of attacks blamed on separatist guerrillas, police said on Saturday. No one was hurt in the small blasts. One bomb exploded in the main town of Ajaccio outside the political office of former industry minister Jose Rossi, president of the general council of Corsica and a deputy of the ruling centre-right coalition. Two other bombs rocked government offices in Bastia in northern Corsica, wrecking doors and blowing out windows. In a marina in Macinaggio, also in the north of the island, the harbour master's office was also damaged by a blast. No one claimed responsibility for the attacks but police said they seemed part of a two-decade-old campaign by separatists for greater autonomy from Paris. Earlier this week, the outlawed Corsican National Liberation Front (FLNC), one of the main guerrilla groups, buried a shaky seven-month truce, accusing the government of reneging on secret commitments. 2697 !GCAT !GCRIM Police are holding a 74-year old Dutchman after a tipoff in connection with Belgium's probe of a child-kidnapping and pornography scandal, police said on Saturday. Police with sniffer dogs searched a house out in Amstelveen, 15 kilometres (9.3 miles) south of Amsterdam on Thursday evening after receiving information from Belgium. Police spokesman Klaas Wilting told Reuters two firearms were found at the address but so far no evidence of a direct link with the Belgian case. "We received some information of a connection to the Belgian investigation and searched the house. We found two guns but so far nothing to connect him to the two missing girls," he said. No formal charges have yet been brought. Six people have so far been arrested in Belgium following the rescue a week ago of two kidnapped young girls from a makeshift dungeon in a house owned by Marc Dutroux in Charleroi. Then followed the discovery of the bodies of two other abducted girls who had starved to death, and a stepped-up hunt for two more girls who Dutroux admitted kidnapping a year ago. The two dead girls, Julie Lejeune and Melissa Russo, were buried in what was virtually a state funeral in the eastern city of Liege on Thursday. 2698 !GCAT !GPRO !GREL Doctors struggling to save Mother Teresa's life said late on Saturday that the 85-year-old nun and Nobel peace prize winner was stricken with an irregular heartbeat. "Her condition is not good. The general condition has remained unchanged. She has had bouts of irregular heartbeats," Dr S.K. Sen, medical director at Calcutta's Woodlands Nursing Home, told reporters. Asked to elaborate on her cardiac condition, Sen said: . "She had a very brief heart failure which was adequately treated. Her cardiac status still remains unstable and she is on respiratory support." Mother Teresa, who became known the Saint of the Gutters after she founded a Roman Catholic missionary order to care for the destitute and dying in Calcutta, remained on a respirator in the hospital's intensive care unit. Sen said a team of six physicians was attending her around the clock and had been able to feed her through a dropper. The world's Roman Catholic population, and many among Calcutta's teeming millions, said they were praying for her survival. Bishop Henry D'Souza of Calcutta said: "We hope that she survives. It is difficult to say. It depends on God." Sister Doleres, in charge of Nirmal Hriday (Pure heart), a home in south Calcutta for the destitute and poor, said: "Mother has a strong survival power. We are all praying to God for her". More than 100 homeless people at the Nirmal Hriday (Immaculate Heart) home which she set up 44 years ago in Calcutta were also praying for the nun who was responsible for bringing them off the streets to shelter. Sen said Mother Teresa, who was awarded the 1979 Nobel Peace Prize and is regarded as a living saint by many for her devotion to the poor, was putting up a great resistance to her illness. A medical bulletin put out earlier by the hospital said she was also suffering from chest infection. Mother Teresa was taken to hospital last Tuesday with a high fever and severe vomiting. The fever, caused by malaria, had now dropped to around 99 degrees Fahrenheit (37.2 Celcius), Sen said. Letters of sympaythy poured in from around the world, including messages from Pope John Paul II and Britain's Princess Diana. Mother Teresa's ailing health dampened celebrations in honour of the 360th anniversery of Calcutta. Local television station postponed a film telecast to broadcast the latest medicial bulletins. News agencies and radio stations were flooded with inquiries. "Some of them are just asking: "how is she? . They are not even mentioning her name'," said a local radio producer. Crowds gathered outside the gates of the Missionaries of Charity, the order founded by Mother Teresa. It now has nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities around the world. 2699 !GCAT !GDIS !GENV Flood waters roared through Pakistan's central province of Punjab on Saturday where officials said at least 26 people were killed in two days. Local newspapers said at least 30 people died and 100 were injured on Friday in the provincial capital Lahore, mostly by collapsing houses. But government officials put the Lahore death toll at 21, including four children and their mother buried alive under their collapsed house on Saturday. Five people died in the eastern district of Sialkot, they said. They said 461 mm (18 inches) of rain had drenched the Punjab capital in 36 hours, turning streets to rivers, knocking out power, water and telephone services, disrupting air and rail traffic and sweeping away houses and cars. Officials said water had receded in most areas of the city on Saturday though high flood waters had hit large tracts of farm land in districts north of Lahore. Weather experts said they expected more rain in northern Pakistan on Sunday. Pakistan usually receives an average of 140 mm (5-1/2 inches) during the whole July-September monsoon season. Transport was resuming in Lahore and telephone authorities said they had restored about half of some 14,000 telephone lines that were out of order. However, main shopping centres remained closed and a number of traders demonstrated on streets protesting against what they called the inefficiency of the Water and Sewerage Agency of the Lahore Development Authority and lack of government help. Ground floors and basements of many buildings were still flooded, residents said. Prime Minister Benazir Bhutto ordered provincial authorities to provide relief on a "war-footing" and placed an unspecified number of helicopters at their dispoal, state radio said. "We have been trapped upstairs since 10 a.m. yesterday when water rushed into the ground floor," said resident Mahmoud Sandhu. "We didn't even have time to rescue our things." Thousands of people had been made homeless after a breach opened in the city canal on Friday, inundating residential areas. Many were given temporary accommodation in school buildings. Local authorities declared a state of emergency on Friday, calling on troops to help evacuate residents of low-lying areas. An official at the Flood Warning Centre in Lahore said the Ravi and Chenab rivers, which both flow through Punjab, were exceptionally high. Rising water could pose a threat to the Jhang, Muzaffargarh and Rajanpur areas, he said. 2700 !GCAT !GDIS !GREL Moslem villagers on Saturday came to the aid of Hindu pilgrims stranded by heavy snow and driving rain on a rugged Himalayan route after 96 people died from exposure, Indian officials said. Thousands of devout Hindus began an annual trek to the Amarnath cave last week to worship a stalgamite believed to be the manifestation of the phallus of the Hindu god Shiva. But the procession was hit by heavy rain and snow. Among the dead were many naked "sadhus", or Hindu holy men who smear their bodies with ash. "The main reason for these deaths is that the pilgrims were not equipped with warm clothing and most of the holy men who died were trekking naked," said Asrar Ahmad, a doctor at a pilgrim camp in Anantnag, 50 km (30 miles) south of Srinagar. Rescue attempts were hindered by bad weather on the approach to the cave 3,880 metres (12,725 ft) high in the Himalayas. "Due to torrential rains and snowfall the helicopters with rescue teams could not land at any place in the region," K.B. Jandial, spokesman for the Jammu and Kashmir state government, told Reuters. "But we have received reports that local villagers are helping more and more pilgrims to trek down from high altitude areas," he said. Army officials said they were providing shelter and aid to nearly 40,000 pilgrims at army camps set up along the route. "We have distributed thousands of food packets," said Lt-Col Anil Bhatt, a public relations officer in New Delhi. "Eight army mobile hospitals are busy treating the trekkers for exposure." Bhatt said army personnel escorted the trekkers down the slopes, carrying the ill and injured through pouring rain. An official statement said thousands of trekkers stranded in the upper reaches had safely made their way down to Pahalgam town, the base camp for the trek. "Villagers are taking the pilgrims into their homes, giving them food and blankets and warm clothing," said senior police official A.K. Suri, who flew over the area in a helicopter on Saturday but was unable to land because of the poor weather. Over 112,000 Hindus arrived in Jammu and Kashmir, India's only Moslem-majority state, for the trek. Scheduled to end on Wednesday, the trek was suspended until weather conditions improved. The cave's entrance was deep in 33 cm (13 inches) of snow, a weather department official said. Since Friday, 85 mm (3.3 inches) of rain has lashed Srinagar, the state's summer capital. Rescue teams tried unsucessfully to land medicines and other essentials for more than 3,000 people stranded at Panchtarni, 3,700 metres (12,136 ft) high, spokesman Jandial said. "They are at the mercy of nature," he added. Teams of Indian paramilitary forces set to work to clear the 300-km (200-mile) highway between Srinagar and Jammu in the south. The job was expected to take three days. About 25,000 people were stranded in Jammu, the state's winter capital, after floods and landslides caused by torrential rains blocked the highway. Last year the pilgrimage was threatened by Moslem separatist guerrillas who staged two bomb attacks on the heavily guarded pilgrims. A state civil servant was killed in one of the blasts. Some 20,000 people have died since a separatist revolt broke out in 1990 in Jammu and Kashmir, police and hospital sources say. This year guerrillas issued no ban on the pilgrimage. Instead, bad weather has endangered the pilgrims' lives. 2701 !GCAT !GVIO The head of Dhaka University resigned and opposition lawmakers walked out of parliament as campus violence mounted in Bangladesh on Saturday. Two more deaths in the northern town of Bogra brought the toll in student-police clashes to five dead in three days. Political tempers have been fraying since the government of Prime Minister Sheikh Hasina, who won power in a June's election after a long period of turmoil, said last week it was preparing corruption charges against her predecessor, Begum Khaleda Zia. Professor Emajuddin Ahmed said he resigned over the deteriorating situation in the university. "I am unable to carry on my responsibility," he told reporters. "What I have achieved in the past four years have now been washed away by the unrest," said Ahmed, who was appointed vice-chancellor, the academic head of the 28,000-student university, by Begum Khaleda. Members of Khaleda's Bangladesh Nationalist Party walked out briefly from parliament on Saturday to protest against "motivated police action" at the university and in Bogra, state television reported. Two students and a policeman were shot dead in a fierce battle in Bogra on Thursday. Two others were killed on Saturday in the town in renewed clashes as students backed by opposition activists attacked a police station, they said. One of the dead was Rezaul Karim Ratan, a 15-year-old student of the local Pre-cadet School. The other could not be identified immediately. Newspaper reporters said paramilitary soldiers, called in after the police station came under attack, opened fire at hundreds of demonstrators, some of whom were firing guns. "It was a hell of a battle. The situation is now under control but very tense," one reporter said. Dhaka University students clashed with police and damaged nearly 20 cars on Saturday. Police said disorder flared when a BNP student group, holding a campus rally, heard that its vice-president, Bashiruddin Ahmed, had been shot. Doctors said he was alive but in critical condition. Student unrest has killed five people in Bangladesh over the past six days and injured nearly 100, police and officials said. Authorities closed Dhaka University for three days on Wednesday after clashes between opposition and the pro-government groups. 2702 !GCAT !GPOL !GVIO The head of Dhaka University resigned and opposition lawmakers walked out of parliament on Saturday as an opposition student leader was shot and campus violence mounted Professor Emajuddin Ahmed said he resigned over the deteriorating situation in the university. "I am unable to carry on my responsibility," he told reporters. "What I have achieved in the past four years have now been washed away by the unrest," he said. Ahmed was appointed vice-chancellor, the academic head of the 28,000-student university, by former prime minister Begum Khaleda Zia. Members of Khaleda's Bangladesh Nationalist Party walked out briefly from parliament on Saturday to protest against "motivated police action" at the university and in northern town of Bogra, state television reported. Political tempers have been fraying since the government of Prime Minister Sheikh Hasina, who won power in a June's election after a long period of turmoil, said last week it was preparing corruption charges against her predecessor, Begum Khaleda. Dhaka University students clashed with police and damaged nearly 20 cars on Saturday. Police said disorder flared when a BNP student group, holding a campus rally, heard that its vice-president, Bashiruddin Ahmed, had been shot. Doctors said he was alive but in critical condition. Student unrest has killed three people in Bangladesh over the past six days and injured nearly 80. Authorities closed Dhaka University for three days on Wednesday after clashes between opposition and the pro-government groups. 2703 !GCAT !GPRO Mother Teresa remained in serious condition with a weak heart on Saturday, but a doctor said the revered Roman Catholic nun was showing surprising strength as she battled for her life. "She is showing enormous strength given her age, which has surprised all of us," Dr S.K. Sen, medical director of Calcutta's Woodlands Nursing Home, told reporters in this eastern Indian city. Mother Teresa's 86th birthday is next Tuesday. Sen said Mother Teresa's fever had fallen and her malaria was under control, but she remained on a respirator in the intensive care unit of the hospital. "It is worrisome," he said. "It (her condition) is still serious. Her condition is still unchanged. She is conscious. Her cardiac condition remains unstable." Earlier, local news agencies quoting unnamed authorities said the condition of the world-renowned nun had improved on Saturday morning and she was in stable condition. Sen said doctors had been able to contain the malaria, and her fever had fallen to 99 degrees Fahrenheit (37.2 Celsius) from 100 degrees (37.8 Celsius). The doctor said there had been no significant complications on Saturday. A medical bulletin released by the hospital said Mother Teresa was being treated with antibiotics for a chest infection. But Sen said Mother Teresa, winner of the 1979 Nobel Peace Prize and known as the Saint of the Gutters for her work with the world's poor and destitute, was unable to speak. "She continues to have respiratory support," Sen said. "She is not able to speak. She is just making gestures. We are keeping strict vigilance around the clock. "We tried to take her out of the respirator yesterday but we failed. We would like to wean her out of it later today." A six-member team of medical specialists has been treating the diminutive nun, who was taken to hospital on Tuesday with a high fever and severe vomiting. While the fever due to malaria had dropped, her heartbeat had remained irregular for the past 48 hours, he said. Sen said: "She has not improved. Neither can I say it has deteriorated. We are giving her the same treatment as we would have given to anybody else. But in her case we are feeling the pressure." The doctor said he was spending half of his day taking telephone inquiries from around the world, and that hospital authorities were allowing only a small number of nuns from Mother Teresa's Missionaries of Charity order to visit her. A crowd gathered in Calcutta at the gates of Missionaries of Charity, which has been the hub of Mother Teresa's worldwide efforts to help the poor with nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities. Letters poured in from around the world, including messages from Pope John Paul II and Indian Prime Minister H.D. Deve Gowda, nuns at her Missionaries of Charity religious order said. 2704 !GCAT Following is a summary of major Indian business and political stories in leading newspapers prepared for Reuters by Business News and Information Services Pvt Ltd, New Delhi. Telephone: 11-3324842, 11-3761233; Fax: 91-11-3351006 Internet : biznis. news@forums. sprintrpg. sprint. com -------oo0oo------- TOP STORIES The Hindustan Times 100 PILGRIMS KILLED IN JAMMU & KASHMIR Around 100 pilgrims were feared killed on their way to the cave temple of Amarnath due to snow and heavy rains even as another 85,000 stood stranded. The Himalayan mountains in south Kashmir have witnessed snowfall and incessant rains since Thursday, disrupting the annual pilgrimage to the high altitude abode of Lord Shiva, which began a week ago. The whole area was hit by floods as the rivers kept swelling. The government was planning to organise a helicopter service to drop food grains, medicines and airlift the pilgrims as soon as the weather improved. This year 125,000 pilgrims made the trek, the highest so far. ---- Indian Express KEY BENEFICIARY IN TELECOM TENDER CASE HELD Scam-tainted former communications minister Sukh Ram informed the Indian High Commission in London that he planned to return to the country next week. Meanwhile, the probe into the telecommunication (telecom) scam took a new turn. The Central Bureau of information (CBI) arrested the main beneficiary in the 0.8 billion rupee telecom tender case, Pataru Rama Rao. Prabhakar Rao, son of former prime minister Narasimha Rao, was likely to be questioned by CBI as he was closely connected with Pataru Rama Rao. ---- The Times Of India PAKISTAN, INDIA HAD AGREED FOR SETTLEMENT India and Pakistan had tacitly accepted de facto partition along the ceasefire line, US State Department papers of the Kennedy era revealed. On the basis that the line of control would not be disturbed, major agreements were negotiated between the two countries. This process continued till Ayub Khan took over as Pakistan's prime minister, the papers said. Ayub Khan in his talks with then US president J F Kennedy had agreed to a partition of Kashmir but wanted the Valley and the Ladakh region which Pakistanis claimed was 79 percent Muslim. The papers also said Nehru was ready to accept the ceasefire line as the border with minor modifications. ---- The Economic Times ALL TELECOMMUNICATION CONTRACTS IN PIPELINE TO BE REVIEWED The Department of Telecommunications (DoT) plans to review all tenders for procurement of equipment and material floated during the tenure of former Communication Minister Sukh Ram. These tenders are yet to be finalised. The large-scale transfer of senior DoT officials is also on the cards. This may delay the award of a large number of contracts by DoT. Sources said the process of tendering might not be reinitiated, but the tenders would be re-examined before their final clearance. ---- FOREIGN INVESTMENTS SET TO BE LOWEST SO FAR IN 1996 The net investments by foreign institutional investors during the first half of August has touched a low of 766 million rupees. The estimates of the Securities and Exchange Board of India, the bourse regulator, revealed the net investment for August was expected to decline sharply in the remaining days of the month. This would be considerably lower than the July figure of 10.74 billion rupees and lowest so far in 1996, the estimates said. ---- MCDONNELL DOUGLAS MAY SHIFT COMPOSITES FACILITY TO INDIA Global aircraft major McDonnell Douglas plans to shift a part of its composite products facility from the US to India. The aircraft major is in talks with Tata Advanced Materials Ltd in this regard. Tata sources said McDonnell Douglas was exploring the possibility of sourcing certain composite items from the Tatas. ---- MAHINDRA VEHICLE SALES UP 23 PCT Automobile major Mahindra & Mahindra produced 26,640 vehicles and sold 26,701 during the period between April to August 1996. The corresponding figures for the previous year were 23,257 and 21,625. In the first five months of this year, production of vehicles has gone up by 15 percent and sales by 23 percent. 2705 !GCAT Following are some of the main stories in Saturday's Pakistani newspapers: DAWN - A state of emergency was declared in Lahore and the army was called out as heavy rains caused 17 deaths and brought life to a virtual standstill. - None of the five committees set up by the government to examine the issue of full-scale trade with India have voiced opposition to such trade through the private sector. - Prime Minister Benazir Bhutto said elections to district councils in Sindh would be held on joint electorate and party basis whereas local councils would be elected on non-party basis. - Consumer prices of gas are likely to be revised upwards soon by about five percent to offset an equivalent increase in the rate of return to the gas companies on their net average fixed assets in operation from the current financial year. - Pakistan will import 1.8 million tonnes of wheat from the United States and Australia this year in spite of an expected bumper crop of 18 million tonnes, official sources said. - Pakistan is poised to harvest another bumper cotton crop of 11 to 12 million bales for the second year in a row and officials are debating whether to allow the surplus to be exported as raw cotton or make it value-added to achieve the export target of $10.2 billion. BUSINESS RECORDER - Foreign exchange reserves reached the IMF-desired level of $1.845 billion at the end of second week of August, but were lower than the $2.302 billion registered a year ago. - Another oil tanker ran aground in the Karachi Port Channel halting shipping movements for several hours on Thursday night. THE NATION - The International Monetary Fund will not send a mission to Pakistan unless the government is "in a position to implement a credible, comprehensive and decisive policy package", Paul Chabrier, IMF Middle East Director, wrote in a letter. THE NEWS - Iranian Foreign Minister Ali Akbar Velayati has announced plans to host a conference of regional foreign ministers to discuss proposals for peace in Afghanistan in October. -- Islamabad newsroom 9251-274757 2706 !GCAT !GPRO Mother Teresa's life remained in danger on Saturday as the 85-year old nun struggled against a faltering heart and malaria, doctors said. They said her heart had remained unstable for most of the day with irregular cardiac beats increasing concern over her condition. "Her condition is not good. The general condition has remained unchanged. She has had bouts of irregular heartbeats," said Dr S.K. Sen, the medical director of Calcutta's Woodlands Nursing Home. "She had a very brief heart failure which was adequately treated," Sen said when asked to elaborate on her cardiac condition. "Her cardiac status still remains unstable and she is on respiratory support," said Sen. Mother Teresa, who will be 86 next Tuesday, is regarded as a living saint by many for her devotion to the poor and destitute. A team of six physicians attending her round-the-clock had been keen to wean her off respiratory support, Sen said. Her temperature was still hovering around 99 degrees Fahrenheit (37.2 Celsius), Sen said. He said doctors had been able to feed her slightly through a dropper. Mother Teresa, who won the Nobel Peace Prize in 1979, was admitted to hospital on Tuesday with a high temperature and severe vomiting. 2707 !GCAT !GPOL Two groups speaking for a strategic northern region of Pakistan-ruled Kashmir accused Islamabad on Saturday of denying human rights to people there and demanded self-rule for the area bordering China. Leaders of Mutahida Qaumi Party (MQP) and Balawaristan National Front (BNF) told a news conference they wanted a U.N.-mandated self-rule for the Gilgit and Baltistan area until a final decision of the dispute between Pakistan and India over the Himalayan region of Jammu and Kashmir. MQP president Hussain Shah and BNF chairman Abdul Hamid both said their groups would launch a mass movement for self-rule for their mountainous region, through which passes Pakistan's famed Karakoram Highway to China. The sparsely-populated 72,520-square km (28,000-square mile) Gilgit and Baltistan region forms the major part of the one-third of Kashmir controlled by Pakistan. India rules two-thirds of Kashmir, over which the two countries have fought two of their three wars since their independence from Britain in 1947. Some 10,360-square km (4,000-square mile) area of Pakistan-ruled Kashmir known as Azad (free) Kashmir enjoys a sort of self-rule with its own government and parliament, but Gilgit-Baltistan region is directly ruled by Islamabad without representation in either the Azad Kashmir or the Pakistani parliament. "We can't call ourselves a people," Hussain Shah said. "This is the only area in the world where 1.5 million are living like animals." Hussain, who said he left the Pakistan army as a major in 1984 because he was dissatisfied with the treatment given to his area, called for self-rule under a scheme approved in 1949 by the then United Nations Commission on India and Pakistan that he said made Islamabad responsible only for the area's defence. "We will not accept anything less than that," he said. "We are going to have a mass movement." BNF leader Abdul Hamid Khan said there was "no sense of human rights" in Gilgit and Baltistan. "There is 100 percent violation of human rights." The two group leaders said a Northern Areas Council introduced in 1994 under a reforms package given by Prime Minister Benazir Bhutto's government was a sham while the real power was exercised by Pakistan's Kashmir Affairs Minister Mohammad Afzal Khan. "The package is nothing but lollipop," Hussain Shah said. "What a farce!" The two groups boycotted voting in October 1994 for the newly-created council, saying it did not meet their demand for more political rights. Political sources in the area say they enjoy considerable support among educated people and supporters of autonomy. They were accused of fomenting rioting by employment-seeking youths in Gilgit town last June. In 1993, the Azad Kashmir High Court declared Gilgit and Baltistan region was not part of Pakistan and asked Azad Kashmir government to take control there. On an appeal by Pakistan, an Azad Kashmir Supreme Court ruling in 1994 agreed the region was part of Kashmir but said it had no power to direct Islamabad to cede control there. 2708 !GCAT !GPRO Once uncared for and unwanted, more than 100 destitutes in a shelter for the homeless in this eastern Indian city pray with special fervour for Mother Teresa. The world's most famous Roman Catholic nun gave them a fresh reason to go on living. Now she lies in hospital, battling for her life, racked by malaria and a faltering heart. About 100 men and women live in Nirmal Hriday (Innocent Heart), a shelter for the homeless Mother Teresa set up 44 years ago. It is run by the order she founded, the Missionaries of Charity. "She is greater than any mother in this world. I would have died of cold if I hadn't come here," said Nada (rpt Nada, one word), who struggles to breathe through a chest infected with tuberculosis. Nada spent a year rummaging through rubbish heaps and begging for food in Calcutta's ugly streets before he found his way to Mother Teresa's home. He seems to be in his seventies (he does not know his age) and cannot walk properly. The pain in his chest is not much less than when he first came, but his shining eyes show that for him life couldn't be better. Mother Teresa, 85, renowned for her devotion to the poor and homeless, has been struggling with heart problems in Calcutta's Woodlands Nursing Home since Tuesday. "All of them are praying to God for Mother's recovery. None of them has ever seen a bible, but they are praying because they know it could save Mother," said Sister Dolores, one of the six nuns who work in the home. "We were constantly called to inform them of the latest condition of Mother," said Sister Judith. Some 55 men and 45 women, mostly Hindu and Moslem, live in the home. Many of them were ill, handicapped or badly maimed before they arrived. Lying on the thin mattresses on plain deal cots in the main hall they can look at a picture of Mother Teresa, with a qotation printed underneath: "The greatest aim of human life is to die in peace with God". "Working in this place makes you feel you are finally doing something for this world," said Irishman Michael Regan, 60, a former policeman who has worked as a volunteer at the home for the last four weeks. Sisters in the home describe the Albanian-born nun as not just full of love but someone who rarely cared for herself. With her example before them, the nuns and volunteers are determined to carry on Mother Teresa's good work. "The work will go on, she always wanted it that way," said Sister Judith. Most inmates missed Mother Teresa on August 22, the home's founding day. She customarily eats lunch with the inmates every year on the anniversary, and shares sweets with them. "They also celebrate her birthday, let us see....", Sister Dolores said. Mother Teresa will be 86 next Tuesday. 2709 !GCAT !GPRO Mother Teresa fought for her life on Saturday, struggling against malaria and a faltering heart as Roman Catholics around the world prayed for her survival. "She is showing enormous strength given her age, which has surprised all of us," Dr S.K. Sen, medical director at Calcutta's Woodlands Nursing Home, told reporters. Mother Teresa's 86th birthday is next Tuesday. In the early afternoon doctors said the revered missionary's fever had fallen to 99 degrees Fahrenheit (37.2 Celsius) from 100 (37.8 Celsius), and her malaria was under control. But the renowned nun, regarded as a living saint by many for her devotion to the poor, remained in serious condition in a respirator in the hospital's intensive care unit. "Nothing has changed. Her condition is as it was in the afternoon," a hospital official said in the early evening. Sister Doleres, in charge of the Nirmal Hriday (Immaculate Heart) home for the destitute in south Calcutta, said: "Mother has a strong survival power. We are all praying to God for her". Sen said there had been no significant complications on Saturday. But he said Mother Teresa, winner of 1979 Nobel Peace Prize and known as the Saint of the Gutters, was unable to speak and her heart continued to falter. "It is worrisome," he said. "It (her condition) is still serious. Her condition is still unchanged. She is conscious. Her cardiac condition remains unstable." Bishop Henry D'Souza of Calcutta said: "We hope that she survives. It is difficult to say. It depends now on God." A medical bulletin released by the hospital said Mother Teresa was being treated with antibiotics for a chest infection. The next bulletin is expected at about 9 p.m. (1530 GMT). "She continues to have respiratory support. She is not able to speak. She is just making gestures. We are keeping strict vigilance around the clock," Sen said. "We tried to take her out off the respirator yesterday but we failed. We would like to wean her out of it later today." A six-member team of medical specialists kept a vigil over the stooped, diminutive nun who was taken to hospital on Tuesday with a high fever and severe vomiting. While fever due to malaria had dropped, her heartbeat had remained irregular for the past 48 hours, Sen said. Letters poured in from around the world, including messages from Pope John Paul II and and Britain's Princess Diana. Mother Teresa's ailing health dampened celebrations in honour of the 306th anniversary of Calcutta. A local television station postponed a film to carry an update on Mother Teresa's health accompanied by a documentary on the nun. News agencies and radio stations were flooded with enquiries. "Some of them are just asking, 'How is she?'" said a local radio producer. "They are not even mentioning her name." A crowd gathered in Calcutta at the gates of Missionaries of Charity, which has been the hub of Mother Teresa's worldwide efforts to help the poor with nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities. 2710 !GCAT !GPRO A worldwide symbol of goodness, Mother Teresa is revered for her untiring devotion to the poor, the sick and the dying. But like most of the world's icons, she is no stranger to criticism and has drawn some unflattering comments for her conservative beliefs and alleged tolerance of suffering. Mother Teresa, 85, was fighting for her life in a hospital in India's eastern city of Calcutta on Saturday, racked with malaria and a faltering heart. A 1994 British television documentary that questioned the worth of the Roman Catholic nun's charity work in India's slums was perhaps the sharpest attack on her actions. The controversial programme, called "Hell's Angel" and aired on Britain's commercial Channel 4, called the media myth around the Nobel Peace Prize winner a mixture of "hyperbole and credulity". For decades television has helped spread Mother Teresa's message of hope for the destitute and brought the image of her tiny, stooped, birdlike figure into homes across the world. A 1968 BBC television interview helped publicise the diminutive nun's charity. Despite her apparent frailty she was seen rushing to Armenia after an earthquake, to Ethiopia during a famine and to Cambodia and Lebanon during war. She was filmed going to the former Soviet Union after the Chernobyl nuclear disaster in 1986. Soviet authorities awarded her the Soviet Peace Committee Gold Medal and allowed her to open a centre in their officially atheist state. But the 1994 British television documentary and, later, published comments by some Westerners familiar with her charity work, said her homes provided haphazard medical care and lacked basic medicines like painkillers. In 1994 Dr Robin Fox wrote in The Lancet, a leading British medical journal: "Mother Teresa prefers providence to planning." The Missionaries of Charity which Mother Teresa created in 1949 does not hide the fact that it is an order of nuns before a group of healers. A yellowing script outside its headquarters in Calcutta quotes from a 1977 interview with Mother Teresa: "We are first of all religious; we are not social workers, not teachers, not nurses or doctors, we are religious sisters. We serve Jesus in the poor." But the documentary's criticism went beyond the apparent lack of first-rate medical care. It dismissed Mother Teresa as a conservative Catholic who ran an order weak on healing skills and preached surrender and prostration to the poor. The documentary accused the Albania-born nun of preaching the message that the poor must accept their fate while the rich and powerful are favoured by God. "She lends spiritual solace to dictators and to wealthy exploiters, which is scarcely the essence of simplicity, and she preaches surrender and prostration to the poor, which a truly humble person would barely have the nerve to do," said journalist Christopher Hitchens, who wrote the script for the documentary. Mother Teresa's supporters around the world rose up in defence. Cardinal Basil Hume, leader of Britain's Roman Catholics, said the documentary was a grotesque caricature. "She represents what ordinary people everywhere acknowledge as genuine holiness," he said. Mother Teresa had her own stoic reply to film makers: "Forgive them for they know not what they do." 2711 !CCAT !GCAT !GVIO Pakistani bomb disposal experts searched a Copenhagen-bound Pakistan International Airlines Boeing 747 jumbo jet at Lahore airport on Saturday after receiving a bomb warning, airport officials said. The warning was made in a telephone call to an international news organisation in London. One official said passengers had begun boarding flight PK 705 when the warning was relayed to Lahore airport flight controllers from their counterparts in Copenhagen. He said no bomb had been found on the plane and the flight, which originated in Islamabad, had been cleared to take off at seven p.m. (1400 GMT). 2712 !GCAT !GCRIM !GVIO Bangladeshi students clashed with police on Saturday and damaged nearly 20 cars in the capital after a pro-opposition student leader was shot and critically wounded at Dhaka University campus, police said. Police said disorder flared when the opposition-led student group Jatiyatabadi Chhatra Dal (JCD), holding a rally, heard that its vice-president Bashiruddin Ahmed was shot and wounded by rivals. They said police fired teargas to disperse rampaging students who damaged about 20 cars in the street. The JCD leader was rushed to Dhaka Medical College Hospital after he was seriously injured by unknown gunmen. The JCD is the student wing of main opposition Bangladesh Nationalist Party (BNP). Doctors at the hospital said Ahmed was unconscious and remained in critical condition. They gave no other details. A spate of student unrest in the Dhaka University and elsewhere over the past six days left two students and one policeman killed and nearly 80 people hurt. On Thursday the JCD supporters fought police with guns, leaving two of their colleagues and policeman dead in northern Bogra town. Earlier on Wednesday the authorities closed down the university for three days following sporadic clashes between the JCD and the pro-government student wing Chhatra League. University sources on Saturday said Vice-Chancellor Emajuddin Ahmed, under pressure because of unrest in the campus, had threatened to resign. 2713 !GCAT !GPRO Mother Teresa, battling for her life in hospital with a weak heart, began her life-long mission in the teeming slums of Calcutta and later became an inspiration to the world with her devotion to the poor. A doctor attending the 85-year-old nun said he was spending half his day taking telephone calls from around the world and nuns said well-wishes were pouring in, including messages from Pope John Paul II and Indian Prime Minister H.D. Deve Gowda. Known as the Saint of the Gutters, Mother Teresa won the Nobel Peace Prize in 1979 for bringing hope and dignity to millions of unwanted people. "The poor must know that we love them," was her simple message. Bowed and wrinkled, her head shrouded by a sari, she became a familiar symbol of selfless commitment to the destitute and a living saint to her multitude of followers. But while the world heaped honours on her, the nun of Albanian descent has maintained she is merely doing God's work. "It gives me great joy and fulfilment to love and care for the poor and neglected," she said. "The poor do not need our sympathy and pity. They need our love and compassion." The diminutive Roman Catholic missionary, who turns 86 on Tuesday, was in serious condition in intensive care in a Calcutta hospital on Saturday with an unstable heart. Though her high temperature was falling and her malaria was under control, a doctor said she remained on a respirator. But he said she was battling for her life. "She is showing enormous strength given her age, which has surprised all of us," Dr S.K. Sen of Woodlands Nursing Home said. The task Mother Teresa began alone in 1949 in Calcutta, India's most densely populated city, grew to touch the hearts of people of religions around the world. When in 1979 she was told she had won the Nobel Peace Prize, she said characteristically: "I am unworthy." The world disagreed, showering more than 80 national and international honours on her including the Bharat Ratna, or Jewel of India, the country's highest civilian award. Her health began to deteriorate in 1989 when she was fitted with a pacemaker. A year later, the Vatican announced she was stepping down as Superior of her Missionaries of Charity order. More than 100 delegates flew in from around the world to elect a successor. They could not agree, so asked her to stay on. She agreed. In 1991, Mother Teresa was treated at a California hospital for heart disease and bacterial pneumonia. In 1993, she fell in Rome and broke three ribs. In August the same year, she developed malaria, complicated by her heart and lung problems. Last April she fractured her left collar bone. But her increasing frailty, arthritis and failing eyesight did not stop her travels around the world. Mother Teresa was born Agnes Goinxha Bejaxhiu to Albanian parents in Skopje, in what was then Serbia, on August 27, 1910. At the age of 18 she became a Loretto nun, hoping to work at the Order's Calcutta mission. She was sent to Loretto Abbey in Dublin and from there to India to begin her novitiate and teach geography at a convent school in Calcutta. She said her divine call to work among the poor came in September, 1946. After intensive training as a nurse with American missionaries she opened her first Calcutta slum school in December 1949. She took the name of Teresa, after France's Saint Therese of the Child Jesus. In India she was simply called Mother. Mother Teresa set up her first home for the dying in a Hindu rest house in Calcutta after she saw a penniless woman turned away by a city hospital. Named "Nirmal Hriday" (Tender Heart), it was the first of a chain of 150 homes for dying, destitute people, admitting nearly 18,000 a year. Her Missionaries of Charity, a Roman Catholic religious order she founded in 1949, now runs about 300 homes for unwanted children and the destitute in India and abroad. In 1994 a British television documentary called the myth around Mother Teresa a mixture of "hyperbole and credulity" and Catholics around the world rose to her defence. 2714 !GCAT !GDIS !GREL At least 84 Hindu pilgrims braving snow and rain have died from exposure in the Himalayan mountains along a rugged route to a 3,880-metre (12,725-ft) high cave, officials said on Saturday. Nearly 70,000 pilgrims, including many naked devotees, were stranded and authorities in Kashmir have suspended the annual pilgrimage, the officials said. The trek through India's only Moslem majority state began last week and had been scheduled to end next Wednesday. "At least 84 pilgrims have died of cold so far," said K.B. Jandial, a spokesman for Jammu and Kashmir. "We have suspended the movement of pilgrims who are stranded at different places in the state." On Friday, police in Srinigar, the state's summer capital, said 24 devotees had died since Thursday. Jandial said the pilgrimage had not been cancelled but could not say when it might be resumed. Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu god Shiva. Floods and landslides caused by torrential rains have forced authorities to close the 300-km (200-mile) highway between Srinaga and Jammu in the south. Around 25,000 pilgrims were stranded in Jammu, the state's winter capital, officials said. "We have advised all pilgrims stranded in Udhampur and Jammu to go back because it will take more than three days to clear the Jammu-Srinagar highway," Jandial said. Police said they expected more deaths as incessant rain and snow were hampering rescue operations. "At least 5,000 people are stranded in the higher reaches of Pahalgam, where the temperature has fallen to freezing," a senior official said. "The pilgrims are not equipped to handle the weather situation." From Pahalgam onwards, the pilgrims have to use ponies or trek 50 km (30 miles) through the mountains to get to the cave. The rains had flooded all the roads to Pahalgam, officials said. "The main reason for these deaths is that the pilgrims were not equipped with warm clothing and most of the holy men who died were trekking naked," Asrar Ahmad, a doctor at a pilgrim camp in Anantnag, 50 km (30 miles) south of Srinagar, told Reuters. Last year the pilgrimage was threatened by Moslem separatist guerrillas, who staged two bomb attacks on the heavily guarded pilgrims. A state civil servant was killed in one of the blasts. Some 20,000 people have died since a separatist revolt broke out in 1990 in Jammu and Kashmir, police and hospital sources say. This year guerrillas issued no ban on the pilgrimage. Instead, the weather has proved an obstacle, with snow a foot (30 cm) deep at some points on the pilgrims' route, officials said. Authorities are making arrangements to fly out some of the stranded pilgrims to Jammu or the Indian capital New Delhi, Jandial said. 2715 !GCAT !GDIS Some 84 pilgrims have died from exposure in the Himalayan mountains along a rugged route to a 3,880-metre (12,725-ft) high cave, officials said on Saturday. Nearly 70,000 pilgrims were stranded by heavy rain and snow and authorities in Kashmir have suspended the annual Hindu pilgrimage, the officials said. The trek through India's only Moslem majority state began last week and had been scheduled to end next Wednesday. "At least 84 pilgrims have died of cold so far," said K.B. Jandial, a spokesman for Jammu and Kashmir state. "We have suspended the movement of pilgrims who are stranded at different places in the state." The spokesman said the pilgrimage had not been cancelled but could not say when it might be resumed. Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu god Shiva. 2716 !GCAT !GPRO !GREL Mother Teresa's fever has fallen and her malaria is under control, but the Roman Catholic missionary remains in serious condition with an unstable heart, a doctor said on Saturday. "It (her condition) is still serious," Dr S.K. Sen, medical director of Woodlands Nursing Home, told reporters in the eastern Indian city of Calcutta. "Her condition is still unchanged. She is conscious. Her cardiac condition remains unstable." Earlier, local news agencies quoting unnamed authorities said the condition of the world-renowned nun had improved on Saturday and she was in stable condition. Sen said doctors had been able to contain the malaria, and her fever had fallen to 99 degrees Fahrenheit (37.2 Celsius) from 100 degrees (37.8 Celsius). The doctor said there had been no significant complications on Saturday. A medical bulletin released by the hospital said Mother Teresa, 85, was being treated with antibiotics for a chest infection. "She continues to have respiratory support," Sen said. "She is showing enormous strength given her age, which has surprised all of us. She is not able to speak. She is just making gestures. We are keeping strict vigilance around the clock." 2717 !GCAT !GDIS !GENV Floods killed at least 30 people and injured 100 in the Pakistani city of Lahore and other parts of Punjab province, newspapers reported on Saturday. Officials in Lahore said seven people had been killed and four injured there on Friday and many houses had collapsed. They had no details of the other reported casualties. They said 461 mm (18 inches) of rain had drenched the Punjab provincial capital in 36 hours, turning streets to rivers, knocking out power, water and telephone services, disrupting air and rail traffic and sweeping away houses and cars. Pakistan usually receives an average of 140 mm (5-1/2 inches) during the whole July-September monsoon season. "There's still four feet (1.3 metres) of water on the roads, so there's no transport," said newspaper worker Muhammad Bilal on Saturday. "There's no electricity or water at my house." He said skies had cleared and water was receding, but ground floors and basements of many buildings were still flooded. "We have been trapped upstairs since 10 a.m. yesterday when water rushed into the ground floor," said resident Mahmoud Sandhu. "We didn't even have time to rescue our things." They said thousands of people had been made homeless after a breach opened in the city canal, inundating residential areas. Many were given temporary accommodation in school buildings. Local authorities declared a state of emergency on Friday, calling on troops to help evacuate residents of low-lying areas. An official at the Flood Warning Centre in Lahore said the Ravi and Chenab rivers, which both flow through Punjab, were exceptionally high. Rising water could pose a threat to the Jhang, Muzaffargarh and Rajanpur areas, he said. The Urdu-language Nawa-i-Waqt newspaper said a girl drowned when water flooded a ward in Lahore General Hospital, where 10 other patients died for lack of treatment. It said floods had also hit the cities of Sialkot, where a student died in a house collapse, and Wazirabad and Gujrat, north of Lahore. Eight people died in flood-related accidents in the town of Sheikhupura, 50 km (30 miles) west of Lahore. Three people, including two children, died when a house collapsed in Kahna, a village near Lahore. A man was electrocuted in the same village when a power line fell on him. A mother and daughter were killed in Gujranwala, 70 km (45 miles) north of Lahore, it said. A child drowned in a water channel in Korang, near the Pakistani capital, Islamabad. Several newspapers said two members of the religious Jamaat-i-Islami party had drowned while trying to remove books from a basement library at the party headquarters in Lahore. One newspaper said five members of the party had died. 2718 !GCAT !GPRO !GREL The condition of Mother Teresa, in a Calcutta hospital with malaria and a weak heart, has improved and she is now in stable condition, local news agencies said on Saturday. United News of India quoted a hospital spokesman as saying the 85-year-old Nobel Peace Prize winner was "much better". The Press Trust of India (PTI) quoted doctors treating the missionary as saying her fever had come down. The revered Roman Catholic nun was taken to hospital on Tuesday with a high fever and severe vomiting. She later suffered heart failure before responding to treatment. Her condition took a turn for the worse on Friday when one side of her heart began beating irregularly. Earlier on Saturday an official at Calcutta's Woodlands Nursing Home, the hospital where Mother Teresa was being treated, said the missionary was in unstable condition. But the news agencies said her fever, which was 100 degrees Fahrenheit (37.8 Celsius) in the morning, had since fallen. 2719 !GCAT !GDIS At least nine workers died and nine more were injured when a three-storey building under construction collapsed following torrential monsoon rains in the Indian capital, police said on Saturday. At least 18 labourers were trapped inside the building when it crashed down on Friday in the Vikaspuri area of west Delhi, police officer Yogendra Singh said. Nine of the workers were pulled dead from the rubble or later declared dead at hospital. Six of the injured were in hospital while three others were discharged, he said. Police spokesman Duli Ram said rescuers were still clearing debris on Saturday morning to determine if any more workers remained trapped in the rain-soaked rubble. Ram said the police had filed criminal cases against the owner, builder and architect. 2720 !GCAT !GPRO !GREL Mother Teresa, suffering from malaria and a weak heart, remained in unstable condition on Saturday as concern mounted over her condition. "Her condition has not improved," said an official at Calcutta's Woodlands Nursing Home, the hospital where the Roman Catholic nun has been under treatment since last Tuesday. "The doctors are still by her side." Mother Teresa, who turns 86 on Tuesday, was conscious but on a respirator in the hospital's intensive care unit with a temperature of 100 degrees Fahrenheit (37.8 Celsius), doctors said. A bulletin by the six-member team of doctors treating the missionary said her "cardiac status was unstable". "We are still very tense. We don't know what will happen," said Naresh Kumar, a close friend who visited her twice on Friday. Known as the Saint of the Gutters for her work with the world's poor and destitute, Mother Teresa was taken to hospital on Tuesday in the eastern city of Calcutta suffering from high fever and severe vomiting. On Wednesday, Mother Teresa, who was fitted with a cardiac pacemaker in 1989, suffered heart failure but responded to treatment. Doctors said her condition took a turn for the worse on Friday when one side of her heart began pumping irregularly. The Asian Age newspaper said her heart stopped beating for nearly a minute and doctors had to revive her with electric shocks. Hospital officials could not confirm the report. On Friday, doctors discovered the parasite which causes malaria in her blood, explaining her persistent fever. She remained conscious on Friday but was unable to speak, officials said. "She mumbled something when the Bishop of Calcutta came to visit her," a nurse said, adding that Mother Teresa also recognised the Marxist chief minister of India's West Bengal state, Jyoti Basu, when he came to visit her in the afternoon. Calcutta is the capital of West Bengal. Letters poured in from around the world, including messages from Pope John Paul II and Indian Prime Minister H.D. Deve Gowda, nuns at her Missionaries of Charity religious order said. "The Pope wished her a speedy recovery," said Sister Priscilla, a senior member of the order which Mother Teresa formed in 1949. Calcutta's teeming population anxiously awaited information on the condition of their adopted daughter, who won the Nobel Peace Prize in 1979. A crowd gathered at the gates of Missionaries of Charity, which has been the hub of Mother Teresa's worldwide efforts to help the poor. "Why is she suffering so much?" a bystander told The Telegraph newspaper. "Mother Teresa has wiped tears off hundreds of eyes. She has fed the hungry, sheltered the homeless, conforted the aged and given dignity to the dying." The Missionaries of Charity order has nearly 3,000 people ministering to the needy, dying and orphaned in the slums of 200 cities. 2721 !GCAT !GVIO The Islamic Taleban militia said on Saturday it had captured a crucial pro-government base on the Pakistani border after five hours of fighting. A Taleban spokesman in the Pakistani city of Peshawar said the Spina Shega base in Paktiya province had been seized from Prime Minister Gulbuddin Hekmatyar's Hezb-i-Islami forces late on Friday night and its defenders driven across the border. The spokesman, quoted by the Peshawar-based Afghan Islamic Press agency, said five fighters had been killed and 13 wounded in the battle for Spina Shega, Hezb-i-Islami's last and most important military position in Paktiya. No independent account of the fighting was available and Hezb-i-Islami officials could not be reached for comment. Afghan sources in Peshawar said several artillery shells had fallen in the Teri Mengal area on the Pakistani side of the border in the battle, but there were no reports of casualties. Hekmatyar rejoined President Burhanuddin Rabbani's government in June after a reconciliation with his former foe. Hezb-i-Islami used Spina Shega as a supply depot for Mujahideen guerrillas during the struggle against occupying troops of the former Soviet Union in the 1980s. It has remained an important logistical base for the party in factional fighting since the fall of a communist government in Kabul in April 1992. The Taleban, which controls about half of Afghanistan, is vying with Hezb-i-Islami for the support of the traditionally dominant ethnic Pashtun community. Afghan sources said the Taleban might now try to push north to the Hezb-i-Islami-held town of Sarobi, straddling the main highway from Kabul to the eastern city of Jalalabad. 2722 !GCAT !GPOL !GVIO The Islamic Taleban militia said on Saturday it had captured a crucial pro-government base on the Pakistani border after five hours of fighting. A Taleban spokesman in the Pakistani city of Peshawar said the Spina Shega base in Paktiya province had been seized from Prime Minister Gulbuddin Hekmatyar's Hezb-i-Islami forces overnight and its defenders driven across the border. The spokesman, quoted by the Peshawar-based Afghan Islamic Press agency, said five fighters had been killed and 13 wounded in the battle for Spina Shega, Hezb-i-Islami's last and most important military position in Paktiya province. No independent account of the fighting was available and Hezb-i-Islami officials could not be reached for comment. Afghan sources in Peshawar said several artillery shells had fallen in the Teri Mengal area on the Pakistani side of the border, but there were no reports of casualties. Hekmatyar rejoined President Burhanuddin Rabbani's government in June after a reconciliation with his former foe. 2723 !GCAT !GDIS !GENV At least 30 people have been killed and about 100 injured in the flood-hit Pakistani city of Lahore, newspapers reported on Saturday. They said 461 mm (18 inches) of rain had drenched the Punjab provincial capital in 36 hours, turning streets into rivers, knocking out power, water and telephone services, disrupting air and rail traffic, and sweeping away houses and cars. Newspapers quoted witnesses as saying they had seen bodies floating in the streets. Among the dead were five members of the religious Jamaat-i-Islami party who drowned while trying to remove books from a basement library. They said thousands of people had been made homeless after a breach opened in the city canal, inundating residential areas. Army troops were called in to evacuate residents of low-lying areas to higher ground. Officials said the Ravi and Chenab rivers, which both flow through Punjab, were in high flood and emergency services backed by troops were on full alert. 2724 !C12 !CCAT !GCAT !GCRIM A lawyer for U.S. investors who blocked the reorganization plan of insurance market Lloyd's of London said on Sunday Lloyd's has asked an appeals court to overturn the lower court's ruling thwarting its financial recovery. The motion to stay was expected as Lloyd's was preparing to exhaust all measures to proceed with its scheduled Aug. 28 vote on the reorganization plan. Susan Cahoon, one of the lawyers representing investors, told Reuters that Lloyd's had filed a 52-page motion for a panel of appeals judges to consider on Tuesday, a day before the vote. "We just received by fax a motion asking the 4th Circuit Court of Appeals to stay the preliminary injunction -- don't make Lloyd's comply while the 4th Circuit takes up the issue," Cahoon said in a telephone interview from her Atlanta law firm. On Friday, a U.S. federal judge in Richmond, Va. issued a preliminary injunction rendering Lloyd's "reconstruction and renewal" plan doubtful. Shortly afterwards a lawyer for the venerable institution said an appeal had already been filed. The plan called for investors to fund a newly formed reinsurance company, Equitas. But, already near financial ruin from existing Lloyd's investments, they were sceptical, claiming Lloyd's had not supplied them with sufficient information about Equitas and thus breached U.S. securities laws. Judge Robert Payne of the U.S. District Court for Eastern Virginia concurred and ordered Lloyd's to comply within a month. He ruled the 93 U.S. investors in the case would suffer irreparable harm if the preliminary injunction was denied. He said the purpose of the order was to protect Americans, the Lloyd's offer and Aug. 28 deadline to vote on it. The request for an emergency stay, according to Cahoon, "recounts many of the same arguments that Lloyd's made to the lower court: an English choice of laws question on are these or aren't these securities? It cites the dire consequences for Lloyds, and says that the deadlines are fixed and immutable." She said a response would be filed to the judges on behalf of the plaintiffs, asking the appeals court to deny the motion. Lawyers for Lloyd's were not available for comment. In Friday's order, Judge Payne also ruled "requiring Lloyd's to comply with its obligations under the U.S. securities laws would serve the public interest in full disclosure." Investors, whom Lloyd's calls Names -- individuals who pledge their assets to back the insurance policies sold at Lloyd's -- were being asked to pay up to $150,000 each to help fund Equitas, which would take responsibility for $12.4 billion in losses from asbestos, pollution, and disaster claims between 1988-92. Lloyd's is known for exotic, if sometimes risky, insurance policies as well as paying them in a timely manner throughout its 308-year-old history. It reportedly insured the Titanic, paid out claims for the 1906 San Francisco earthquake, covered Hitler's private Junkers airplane, and underwrote the San Francisco-Oakland Bay Bridge before hitting hard times. The ruling effectively blocks creation of Equitas, and Lloyd's has been given until Sept. 23, 1996 to see that American Names receive information on Equitas. There are 2,700 U.S. Names and 33,500 worldwide. Moreover, investors already leaning toward supporting the recovery plan can pay into an escrow account (in lieu of Equitas) set up by the court by Sept. 30. They then have until Oct. 30 to review the information and tell Lloyd's whether they accept the offer. If they accept, their funds will be released from the escrow account to Lloyd's; but if they reject the offer, their funds stay in escrow until the recovery plan is finalised. A trial date has already been set for Nov. 4, and that may not be the last of Lloyd's U.S. legal woes. Colorado Attorney General Gale Norton has told Lloyd's he is working on a new claim against the market on behalf of Names in that state. 2725 !C31 !CCAT !GCAT !GENT "The Island of Dr. Moreau" overcame some of the worst reviews of the year to open at the top of the U.S. box office with an estimated gross of $9.0 million at the weekend. Marlon Brando and Val Kilmer star in the third big-screen adaptation of the H.G. Wells science-fiction novel, a troubled project that saw the firing of one director and the departure of one of the stars. The movie is released by New Line Cinema, a unit of Ted Turner's Turner Broadcasting System Inc. Slipping to second place for the Friday to Sunday period was "Tin Cup" with $8.8 million, according to Exhibitor Relations Co. The Kevin Costner golfing comedy dipped just 13 percent from last weekend and has a 10-day gross of $23.9 million. Opening in third with $7.4 million was "A Very Brady Sequel", the second movie based on the Brady Bunch television series. The courtroom drama "A Time To Kill" was fourth with $6.2 million followed by Robin Williams' "Jack" with $5.9 million. The movie that earned the most per screen was "She's The One", which opened in 10th with $2.2 million. The romantic comedy, which Ed Burns wrote, directed and starred in, averaged $4,793 per screen, the highest tally in the top-10. "Moreau" followed with a per-screen average of $4,423. According to a Variety magazine poll of critics in New York, Los Angeles, Chicago and Washington D.C., only two liked "Moreau", while 17 did not and 13 were mixed. The Los Angeles Times said it was "disastrous," while Variety said it was "an embarrassment for all concerned." Mitch Goldman, New Line's marketing and distribution president, said the studio "didn't necessarily expect it to be No. 1 this weekend." The PG-13 movie played to predominantly younger audiences, and New Line is going to fine-tune the marketing to appeal to adults by emphasising the science-fiction nature over the horror. Goldman said Brando planned to appear on Larry King's CNN talk show this week to drum up support for the movie. "I think he feels that the critics were unjustifiably cruel, and I think he would like to help people get over them (the critics) and see this movie," Goldman said. Brando, who hasn't had a box office hit since the 1970s, told Variety gossip writer Army Archerd last December the movie "could make $500 million." John Frankenheimer directed "Moreau", replacing Richard Stanley who reportedly had differences with Kilmer. After his departure, actor Rob Morrow left and was replaced by David Thewlis. The Brady movie averaged a disappointing $3,447 per screen despite warm reviews. The first instalment opened at the top of the box office with a four-day total of $14.82 million (average $8,138) during the President's Day holiday in February 1995. At least it outperformed many other movies. "Carpool", a comedy directed by Arthur Hiller, the president of the Academy of Motion Picture Arts and Sciences, opened in 13th with $1.8 million. "John Carpenter's Escape From L.A." fell out of the top 10 in its third weekend, and "Bordello of Blood" fell out in its second. 2726 !C12 !CCAT !GCAT !GCRIM By Gail Appleson, Law Correspondent The tobacco industry won a breather from mounting bad news with a greatly needed jury victory Friday, but legal experts said the case was a tiny skirmish in a full-blown war. At the end of a day in which President Clinton signed strict regulations for the sale and advertising of cigarettes, an Indianapolis jury ruled for cigarette companies in the widely-watched case. Tobacco companies longed for a victory in this trial to offset a $750,000 damage award delivered against it by a Florida jury earlier this month. Although cigarette makers said the verdict was an aberration, legal experts pointed out that there was a major difference between the two cases. The Jacksonville, Fla. jury had seen inflammatory internal tobacco documents relating to the industry's knowledge of nicotine and addiction while the Indianapolis jury had not. Jury consultants believe that the documents had a significant impact on the jurors, who found that cigarette companies were responsible for a smoker's addiction. The question that remained was: How will juries in the more than 200 pending cases across the country react if they are allowed to see this evidence? "I think the industry can take a breather with the Indianpolis verdict, but this does not mean it is the end of the war," said Mary Aaronson, a Washington D.C. litigation analyst who advises the institutional investors. "I do think the attitudes of jurors may be changing." In the roughly four decades of tobacco litigation aimed at holding cigarette companies liable for smokers' illnesses, there have only been two juries that have awarded damages to plaintiffs. In the past most jurors blamed plaintiffs for their decision to start and keep smoking. Personal injury lawyers and jury consultants predicted that the internal tobacco documents that began to surface in 1994 will change their point of view. They said that jurors, after seeing the memos, will hold tobacco companies responsible for hiding information about the alleged addictive nature of nicotine and will believe that the industry acts to keep smokers hooked. The industry denies these allegations. Because those documents will most likely be used in many of the upcoming cases, plaintiffs lawyers said the Indianapolis verdict was insignificant. "...It doesn't really set up back," said Richard Daynard, chairman of the Tobacco Products Liability Project at Northeastern Law School in Boston. Lawyers said that the verdict would have had far greater consequences if the tobacco industry had lost. They said a win for the plaintiffs would have provided even greater support for the view that jurors attitudes had changed because the panel had not even seen key tobacco documents. This could have had tremendous implications as jurors will one day be determining the outcome of the hundreds of suits currently pending on behalf of smokers, their families and people claiming injury from secondhand smoke. In addition, 14 states as well as San Francisco and Los Angeles have sued the industry to recoup health care costs of smokers. Tobacco lawyers dismissed these concerns. Charles Blixt, senior vice president, general counsel of R.J. Reynolds Tobacco Co., said that for years plaintiffs' lawyers had been touting that they had ideal cases but juries have almost always found them lacking. "This is not a court of public opinion, it is a court of law," he said. "Each (upcoming) case is a little bit different but we believe that in spite of those differences jurors will continue to find that people are responsible for the decisions they make in their life." 2727 !C11 !C12 !CCAT !GCAT !GCRIM Lloyd's of London tried on Sunday to ward off doubts about the success of its recovery plan, announcing that 75 percent of its investors worldwide had already accepted the proposals. The 300-year-old insurance market is embroiled in a critical legal battle in the United States where 93 investors last week extracted an injunction ordering Lloyd's to give all U.S. investors more information and more time to vote on the plan. Lloyd's gave its 34,000 investors -- called Names -- until Wednesday this week to decide whether to accept or reject the recovery plan, under which it hopes to reinsure billions of pounds in liabilities into a new company called Equitas. The plan includes a 3.2 billion pound ($five billion) offer to soften the cost to Names of Equitas and end litigation. Lloyd's will appeal in court in Baltimore, Maryland, on Tuesday against the injunction served by U.S. district judge Robert Payne in Virginia late on Friday. It was unclear how far-reaching the impact would be on the recovery plan if the appeal fails. The announcement that three-quarters of the Names had backed the plan suggested that by Wednesday there could be the overwhelming support needed to push it through. Acceptance forms were believed to be flooding into Lloyd's at the rate of 2,000 a day last week. Four thousand more would represent nearly another 12 percent. "I am confident that, by the deadline, the offer will have been accepted by the overwhelming majority of our members," said chairman David Rowland in a brief statement on Sunday. But how much is enough to declare it unconditional? Some prominent Names contacted by Reuters noted that Lloyd's did not say how many U.S. Names had accepted so far or which classes of Names had accepted. A spokesman said a breakdown was not available. Before Payne's decision, Rowland was reluctant to give any information on the level of acceptances, saying such figures meant very little as success depended on "yes" votes from two key blocks: the litigating Names and those with big outstanding debts needed by Lloyd's to fund Equitas. "Lloyd's said it was interested in quality of acceptance rather than quantity," said one British Name. "What they've got so far is anybody's guess." He added: "If I was an American Name, why should I be in a hurry to accept?" Payne ordered Lloyd's to provide all U.S. Names with more information by September 23. Those who elect to wait can pay funds into an escrow account no later than September 30 and make their minds up a month later. If the offer went unconditional, Lloyd's said it might give those who had not accepted more time in which to do so. It may not need 100 percent support by Wednesday, but a critical mass is crucial and acceptances from key parties have to be secured. -- London Newsroom, +44 171 542 7721 2728 !GCAT !GSPO Phil Mickelson birdied two of the last three holes to win World Series of Golf by three strokes over Billy Mayfair on Sunday. It was the fourth tournament title this year for Mickelson, who shot an even-par 70, after being tied for the lead with Billy Mayfair with three holes to play. Along with Mayfiar at 277 for the tournament were Steve Stricker, who had a 68, and Duffy Waldorf, with a 66. "It was very hard to sleep last night because there was so much I could accomplish with this win," said Mickelson, who had a three-stroke lead entering the third round. "This was a win I wanted very, very much." Mickelson's victory gave him a 10 year exemption to the PGA Tour. The $378,000 first place check brings Mickelson back to the top of the money list with $1,574,799 won this year. "This is a major championship golf course, and for me to perform well on this style of course is a big step up for me in my career and my performance in future majors," he said. Mickelson three-stroke lead was cut to two when Mayfair birdied the course's only easy hole, the par five second hole, while Mickelson three-putted for par from 25 feet. On the back nine Mickelson began driving erratically, and poor tee shots resulted in bogeys on the, eighth, 12th and 13th holes, bringing Mickelson back to four under par, tied with Mayfair, who had parred 14 straight holes after the birdie on no.2. Mickelson then set up a tap in birdie on the 16th, sending a wedge shot to 18 inches. He had another birdie on the 17th, where he his a 6-iron to six feet. Mayfair bogeyed the 17th, missing a five foot par putt, and dropped from solo second place to a three way tie for second. It was the second successive year in which Mayfair has finished runner up in this tournament. He lost to Greg Norman in sudden death last year. The defending champion was in contention, two behind Mickelson for much of the day, until he bogeyed the 13th and 14th holes. 2729 !C31 !CCAT !GCAT !GENT "The Island of Dr. Moreau" overcame some of the worst reviews of the year to open at the top of the U.S. box office with an estimated gross of $9.0 million at the weekend. Marlon Brando and Val Kilmer star in the third big-screen adaptation of the H.G. Wells science-fiction novel, a troubled project that saw the firing of one director and the departure of one of the stars. The movie is released by New Line Cinema, a unit of Ted Turner's Turner Broadcasting System Inc. Slipping to second place for the Friday to Sunday period was "Tin Cup" with $8.8 million, according to Exhibitor Relations Co. The Kevin Costner golfing comedy dipped just 13 percent from last weekend and has a 10-day gross of $23.9 million. Opening in third with $7.4 million was "A Very Brady Sequel", the second movie based on the Brady Bunch television series. The courtroom drama "A Time To Kill" was fourth with $6.2 million followed by Robin Williams' "Jack" with $5.9 million. The movie that earned the most per screen was "She's The One", which opened in 10th with $2.2 million. The romantic comedy, which Ed Burns wrote, directed and starred in, averaged $4,793 per screen, the highest tally in the top-10. "Moreau" followed with a per-screen average of $4,423. According to a Variety magazine poll of critics in New York, Los Angeles, Chicago and Washington D.C., only two liked "Moreau", while 17 did not and 13 were mixed. The Los Angeles Times said it was "disastrous," while Variety said it was "an embarrassment for all concerned." Mitch Goldman, New Line's marketing and distribution president, said the studio "didn't necessarily expect it to be No. 1 this weekend." The PG-13 movie played to predominantly younger audiences, and New Line is going to fine-tune the marketing to appeal to adults by emphasising the science-fiction nature over the horror. Goldman said Brando planned to appear on Larry King's CNN talk show this week to drum up support for the movie. "I think he feels that the critics were unjustifiably cruel, and I think he would like to help people get over them (the critics) and see this movie," Goldman said. Brando, who hasn't had a box office hit since the 1970s, told Variety gossip writer Army Archerd last December the movie "could make $500 million." John Frankenheimer directed "Moreau", replacing Richard Stanley who reportedly had differences with Kilmer. After his departure, actor Rob Morrow left and was replaced by David Thewlis. The Brady movie averaged a disappointing $3,447 per screen despite warm reviews. The first instalment opened at the top of the box office with a four-day total of $14.82 million (average $8,138) during the President's Day holiday in February 1995. At least it outperformed many other movies. "Carpool", a comedy directed by Arthur Hiller, the president of the Academy of Motion Picture Arts and Sciences, opened in 13th with $1.8 million. "John Carpenter's Escape From L.A." fell out of the top 10 in its third weekend, and "Bordello of Blood" fell out in its second. 2730 !C33 !CCAT !GCAT !GENT Warner Bros. Records said on Sunday it signed a contract with rock band R.E.M., reportedly worth $80 million, the largest recording contract in history. "Yes, we have signed a new contract with R.E.M.," Warner Bros. Records Chairman Russ Thyret told Reuters. Thyret declined immediate comment on specific details but industry sources told the Los Angeles Times that Warner signed a five-album contract worth an estimated $80 million. The deal eclipses pop singer Janet Jackson's estimated $70 million contract with Virgin Records, signed in January. "This is a watershed moment for Warner Bros. Records -- an incredible new beginning for the company," label president Steven Baker told the newspaper. The Los Angeles Times said the deal was announced at a meeting of Warner executives in Anaheim, California on Saturday. Thyret was reached in his hotel room in Anaheim on Sunday, where he was conducting meetings. An industry source told Reuters the contract was fairly priced. "Based on the kind of money that R.E.M. generates, Warner will certainly make their money back," he said. But Thomas White, an artist rights expert, said he thought the contract price was inflated. "These kinds of deals are hazardous to labels. It makes no real economic sense, except to maintain appearances and keep the name connected to the band," he said. The Grammy-winning band had for the past two weeks been the target of a bidding war among major labels, including DreamWorks SKG, Capitol Records and Sony Music, the Los Angeles Times reported. Though details of the deal have not been made public, the daily quoted sources as saying the band would earn a $10- million signing bonus, plus a $20-million royalty advance on future sales of it's Warner catalog. The band is also guaranteed an estimated $10 million advance per album and 24 percent royalty for each record sold. Under terms of the deal, ownership of the master recordings of those five albums will revert to R.E.M. seven years after the end of the contract, the newspaper reported. R.E.M. was formed in the small college town of Athens, Ga., about 70 miles east of Atlanta, in 1980 by guitarist Peter Buck, now 39, singer Michael Stipe, 36, and bassist Mike Mills and drummer Bill Berry, both 37. Since then, the band -- still made up of the original four members -- has sold more than 30 million albums and won four Grammy awards. A new release, titled "New Adventures in Hi-Fi," is due in two weeks. 2731 !C11 !C12 !C17 !CCAT !GCAT !GCRIM Lloyd's of London tried Sunday to ward off doubts about the success of its recovery plan, announcing that 75 percent of its investors worldwide had already accepted the proposals. The 300-year-old insurance market is embroiled in a critical legal battle in the United States where 93 investors last week extracted an injunction ordering Lloyd's to give all U.S. investors more information and more time to vote on the plan. Lloyd's gave its 34,000 investors -- called Names -- until Wednesday this week to decide whether to accept or reject the recovery plan, under which it hopes to reinsure billions of pounds in liabilities into a new company called Equitas. The plan includes a 3.2 billion pound ($5 billion) offer to soften the cost to Names of Equitas and end litigation. Lloyd's will appeal in court in Baltimore, Md., on Tuesday against the injunction served by U.S. District Judge Robert Payne in Virginia late Friday. It was unclear how far-reaching the impact would be on the recovery plan if the appeal fails. The announcement that three-quarters of the Names had backed the plan suggested that by Wednesday there could be the overwhelming support needed to push it through. Acceptance forms were believed to be flooding into Lloyd's at the rate of 2,000 a day last week. Four thousand more would represent nearly another 12 percent. "I am confident that, by the deadline, the offer will have been accepted by the overwhelming majority of our members," said chairman David Rowland in a brief statement on Sunday. But how much is enough to declare it unconditional? Some prominent Names contacted by Reuters noted that Lloyd's did not say how many U.S. Names had accepted so far or which classes of Names had accepted. A spokesman said a breakdown was not available. Before Payne's decision, Rowland was reluctant to give any information on the level of acceptances, saying such figures meant very little as success depended on "yes" votes from two key blocks: the litigating Names and those with big outstanding debts needed by Lloyd's to fund Equitas. "Lloyd's said it was interested in quality of acceptance rather than quantity," said one British Name. "What they've got so far is anybody's guess." He added: "If I was an American Name, why should I be in a hurry to accept?" Payne ordered Lloyd's to provide all U.S. Names with more information by Sept. 23. Those who elect to wait can pay funds into an escrow account no later than Sept. 30 and make their minds up a month later. If the offer went unconditional, Lloyd's said it might give those who had not accepted more time in which to do so. It may not need 100 percent support by Wednesday, but a critical mass is crucial and acceptances from key parties have to be secured. 2732 !C41 !CCAT !GCAT !GPRO Newspaper magnate Conrad Black celebrated his 52nd birthday on Sunday in the unfamiliar role of white knight after galloping in last week to grant a reprieve to the Canadian Press (CP). One of Black's trusted managers, Sterling Newspapers chairman Michael Sifton, took over on Wednesday as chairman of the 79-year-old news service, which was endangered earlier this year when Southam Inc., its biggest-circulation member, threatened to pull out of the cooperative. Black's Hollinger Inc. bought control of Southam, Canada's best-respected newspaper chain, in May. Two months later Southam's chief executive, William Ardell, who wanted to revamp Southam's news service to compete with CP, quit. Despite Black's recent acquisition of the lion's share of the newspaper industry in his native Canada and the appointment of a close lieutenant to run CP, Hollinger disputes that it has an iron grip on Canada's press. "This is not, absolutely not, a Hollinger ... coup," David Radler, Hollinger's president and chief operating officer, said of Sifton's appointment to head CP. Black is the youngest of the current breed of global newspaper magnates. Like Rupert Murdoch, he is not often seen as a hero by the media. Black began with a C$500 ($365) investment in two tiny Canadian newspapers, and with a little help from a multimillion-dollar family inheritance, he parlayed that into the Hollinger empire, which now spans three continents. Southam is the newest addition to Black's media toy chest, which includes the Daily and Sunday Telegraph in London, the Chicago Sun-Times, the Jerusalem Post and a 25 percent stake in John Fairfax Holdings Inc., which publishes the Sydney Morning Herald and the Australian Financial Review. Black has candidly confessed his delight at the respect and deference granted newspaper proprietors and admitted he likes hobnobbing with the rich, famous and powerful. His long-standing love affair with newspapers does not extend to the journalists he employs, however. Before a government commission on mass media in 1969, Black dismissed reporters as "ignorant, lazy, opinionated, intellectually dishonest and inadequately supervised" and slammed what he called an abdication of responsibility by many editors, publishers and newspaper owners. There is no reason to think he has changed his mind since. After a strike at the Telegraph forced management to step successfully into the breach for 36 hours, Black said "one of the greatest myths in the industry" was that journalists were required to produce a newspaper. Black said he was virtually forced to buy out Southam to protect his investment. Irritated with a group of independent directors who he said thwarted all efforts to reverse Southam's losses, Black bumped his stake up to 41 percent from 19.5 percent by buying out Power Corp. of Canada. His move on Southam seems to be classic Black. He usually starts with a small shareholding, ups it to a controlling interest and eventually acquires the entire business. This is how Black won the Telegraph and, earlier, acquired Argus Corp., a company where his father had been an executive and one he had reportedly coveted since childhood. Black's managers and board representatives are fast replacing those who opposed him at Southam. Defections emptied Southam's executive suite last week. Black is now chairman and chief executive of Southam, and Radler is deputy chairman. The young Black was apparently riveted by the character of Napoleon, whom he describes in his autobiography "A Life in Progress", as an accomplished "aphorist, swashbuckler and self-mythologist." He might have been describing himself. Black's tough approach to business once led Bob Rae, the left-wing former premier of the province of Ontario, to describe him as "a symbol of bloated capitalism at its worst." Even his friends admit he tends toward narcissism. "I think you have to have a certain arrogance to aspire to this sort of thing ... and to push it through. I don't think you do that with the humility which Jesus has commanded on us -- He said the meek will inherit the earth, not own the earth," Stephen Jarislowsky, a friend and business associate who sits on many Hollinger company boards, said in a recent interview. Black "fell profoundly in love" with London Sunday Times political columnist Barbara Amiel and married her in 1992. Amiel, vice president of editorial at Hollinger, is a sought-after party guest in London, and British society magazines Harper's and Queen and Tatler have both named her one of history's most alluring women. 2733 !C12 !C17 !CCAT !G15 !G152 !GCAT !GCRIM German Economics Minister Guenter Rexrodt has suggested temporarily freezing controversial east German subsidies to car giant Volkswagen AG to help settle a row with the European Commission. The Commission is disputing the legality of 91 million marks ($61.09 million) of a 142-million-mark subsidy package paid to Volkswagen to support its investment in two plants in the east German state of Saxony. In an interview to be published in this week's Der Spiegel magazine, Rexrodt said he supported Volkswagen's case but said a temporary freeze of the disputed funds pending a European court ruling could form the basis for compromise. "But that will not work without the support of the receiver of the payment. VW has not yet warmed to an idea like this," Rexrodt cautioned. The Saxony state government, which made the payment to Volkswagen in defiance of objections from Brussels, said on Sunday it had lodged a complaint against the Commission with the European Court of Justice before the weekend. A spokeswoman for the state said Saxony, with Bonn's support, wanted a court decision on whether Brussels had a legal say in determining the allocation of east German subsidies. A European ruling in June cleared only 540 million marks in East German subsidies for Volkswagen out of an initial plan for 780 million marks. In an interview published in the Financial Times' weekend edition, Volkswagen chairman Ferdinand Piech insisted that the funds received in July were paid legally. Piech said: "We received it (the investment) legally and because we did so, we will invest it correctly. We had the choice of any location: without support, it would not have been this one." Rexrodt, who discussed the dispute with European Competition Commissioner Karel Van Miert on Friday but failed to reach a solution, said he believed the subsidy payment was justified, but "problematic and politically ... dubious." Separately, Saxony's Biedenkopf told German magazine Super Illu that he would not bend on the subsidy payment, on which he said 23,000 jobs depended. Volkswagen had threatened to pull the plug on its plans to build plants in the Saxony towns of Mosel and Chemnitz if the funds were not paid in full. "We will fight through this," said Biedenkopf. The Commission is due to discuss the case on September 4. Meanwhile Bonn and the Commission are to continue their talks. ($1=1.4895 Mark) 2734 !GCAT !GPOL !GPRO The British Treasury on Sunday described as pure speculation" a report saying the government was planning a huge stock market flotation of the Crown Estate, the property which once belonged to the British monarch. The Sunday Business newspaper said Britain's Queen Elizabeth would receive one billion pounds ($1.5 billion) as part of the six billion pound ($14 billion) deal. The fate of the Crown Estate has been under discussion since it was announced last week that the Queen was studying plans for a radical shake-up of monarchy, which is reeling from a series of messy scandals and divorces. The Crown Estate, which includes land across the British countryside as well as lucrative areas in London, was surrendered to the government by George 111 in 1760 in exchange for a fixed annual income. There has been speculation that the monarchy would get these estates back in return for renouncing the state subsidies which are now provided to cover expenses. Sunday Business said the Treasury had confirmed that the Crown Estate was a candidate for privatisation, but a spokesman for the Treasury denied such confirmation had been given. The newspaper said the Queen would receive a one-off fee of 10 times the current income she receives from the Estate which amounted to 94.6 million pounds ($147 million) last year. The Queen, her son Prince Charles and other members of the royal family have formed a committee to look at ways of updating and improving the monarchy. Their review not only covers finances but is also looking at scrapping ancient laws which discriminate against women in the succession to the monarchy and which also ban the monarch from marrying a Roman Catholic. 2735 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The Canadian Auto Workers union (CAW) said on Sunday its members employed by the Big Three North American carmakers voted overwhelmingly to give union leadership the authority to call a strike to back contract demands. The CAW said members at Ford Motor Co.'s Canadian subsidiary voted 96.65 percent in favor of a strike mandate. Chrysler Corp. members voted 93.79 percent in favor of a strike. CAW members at General Motors Corp.'s Canadian unit voted 92.38 percent in favor of possibly taking strike action. "It shows they're mad as hell at the companies and they want this thing resolved," said CAW president Buzz Hargrove. The CAW is the largest private sector union in Canada with 52,800 of its 210,000 members in the auto industry alone. The union said its members voted in favor of a strike if the union leadership believes it cannot reach acceptable collective agreements with the automakers after the contracts expire on Sept. 14. "They're supporting the union on the issues as well as the strategy I've outlined over the last 10 days," said Hargrove. "This means we have the mandate from our membership to call a strike if we have to. We don't want to. We want to bargain a settlement." Hargrove told reporters on Thursday that on Aug. 28 the union will announce which of the three carmakers will be its target for bargaining and possibly a strike. Traditionally, the CAW chooses one of the companies to seek a master agreement as a framework for its labor contracts with all three. Hargrove said he will press ahead with announcing his target despite a Thursday announcement from the United Auto Workers union in the United States that it has not yet chosen its own bargaining target. It would be the first time the CAW had chosen a strike target before the UAW and could rob the Canadian members of bargaining leverage if the same company is chosen as a target by the much larger U.S. union. CAW president Buzz Hargrove has also said he expects it to be tough to apply a master agreement forged at Ford or Chrysler to its labor contract with GM this round and he thinks it will be "difficult" to avoid a labor dispute. "Whether or not they are the target, if they are first second or third we have a different problem at GM than we do at Ford or Chrysler," Hargrove told Reuters on Wednesday. Although contracting out work or outsourcing in the auto industry is a major issue at all three carmakers, GM has made outsourcing decisions in the last year that will eliminate over 5,000 CAW jobs and the union is determined to try and reverse them. 2736 !GCAT !GENT During his 24-year rule Romanian dictator Nicolae Ceausescu boosted ties with China, while at the same time trying to keep the Soviet Union on his side. Chinese goods flooded local stores while Ceausescu wined and dined a constant stream of gift-bearing Chinese officials, including Deng Xiaoping, now China's paramount leader. Now Romania's national art museum is drawing crowds with a glimpse of the rich gifts which China's communist elite, including Chairman Mao Zedong, showered on Ceausescu. The exhibition makes no direct reference to Ceausescu, who was shot by a firing squad on Christmas Day, 1989 during Romania's violent revolution. The catalogue calls it "Modern Chinese Art in Traditional Style" and says the pieces on show are as old as communist China. Ceausescu was not known for his taste in art. Instead he had a penchant for hoarding wealth, which he shared with other communist leaders, from East Germany's Erich Honecker to Bulgaria's Todor Zhivkov. After he and his wife Elena were executed, the post-communist authorities seized the 21 palaces, 41 villas and 20 hunting lodges which Ceausescu had used in his lifetime. Most of the valuables, including his Chinese art collection, were taken to the museum for safe-keeping. The exhibition, which opened in July, displays some 100 artefacts -- from small statues of ancient Chinese gods to hunting scenes carved in ivory, jade charms or lacquer vases. In the early 1970s Ceausescu, following Mao's model, tried to launch a Chinese-style "cultural revolution" in Romania which stressed a simplicity in stark contrast to his own lifestyle. His personality cult grew over the years, and so did Romania's isolation from the outside world. All this was accompanied by the construction of huge buildings in the centre of Bucharest and other Romanian cities -- a reminder of Ceausescu's travels to China and North Korea which inspired his dreams of grandeur. The exhibits include enamel vases, some shaped like garlic cloves, and statues carved in jade, a stone "which the Chinese revered and credited with magical powers, saying it could bestow immortality" -- according to the catalogue. Curators say the pieces might fetch a good price at auction, but have little artistic value in themselves. "These were all protocol gifts. They are more craftsmanship rather than art. Their main function was to impress, as expensive gifts," said curator Gyury Kazar, pointing to an ivory tower formed of elaborate overlapping globes. "This piece might contain the tusks from at least two elephants," added Kazar, an expert in Japanese prints. "Ceausescu must have had much more among his possessions than these Chinese ornaments," mused Sandra Ponti, an Italian tourist, emerging from the exhibition, which is being held in a marble-lined room on the museum's ground floor. "Lots of people are coming to see what he kept in his home," said a guard. Outside, workers perched on scaffolding were trying to repair the museum's classical facade which was severely damaged by artillery fire during the revolution. Only the ground floor is open to visitors, with the Chinese exhibition due to run until September, alongside a show of Rodin sculptures and another of paintings by old German masters to French Impressionists. The rest of the museum is closed for repairs, which because of lack of funds, may take many years. 2737 !E51 !E512 !ECAT !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto, on a 10-day trade mission to Latin America, found a touch of home on Sunday in Brazil's sprawling metropolis of Sao Paulo where he was greeted by the largest Japanese community outside Japan. Hundreds of Japanese-Brazilians waved flags from the two nations and shouted "Banzai" (a Japanese patriotic cry) as Hashimoto stopped to shake hands and chat before visiting a museum in the Japanese neighbourhood of Liberdade. Hashimoto did not deliver a formal address to the Japanese community, but he referred to their influence in Latin America's largest nation in a brief entry in the museum's guest book. "While visiting Brazil, I have witnessed the results of the labour of Japanese descendants in various places," he wrote in Japanese. Sao Paulo is home to most of the 1.3 million Brazilians of Japanese descent, known as 'Nikkei,' and some 90,000 Japanese citizens. After touring the museum, Hashimoto and his 15-car entourage zipped through Liberdade's narrow roads lined with ornate street lamps to a meeting with Sao Paulo state Gov. Mario Covas. Brazil is Hashimoto's third stop on a five-nation tour of Latin America designed to entice more Japanese investment into the region. Liberdade residents welcomed Hashimoto, saying his visit would help draw more Japanese investment to Brazil and more jobs to their community, many of whose members work for Japanese firms. "It's good for the Japanese community because it means that Japanese industry will continue investing in Brazil," said one onlooker who works for a Japanese engineering firm in Sao Paulo. Japanese foreign investment in Brazil totalled $1.23 billion in 1994, up from just $171 million in 1991. The first Japanese landed in Brazil in 1908. They were the last of a wave of immigrants who began arriving in the late 19th century when the country banned slavery and was looking abroad for labour to farm its vast interior. The early immigrants hoped to take quick profits from the land and return to Japan, but as more arrived, Japanese communities were formed and immigrants settled into Brazilian life. By the outset of the Second World War, some 190,000 Japanese had immigrated to Brazil and about 60,000 have come since the end of the war. Today, after decades of booming economic growth in Japan, many Japanese Brazilians have opted to return to their ancestoral homeland in a reverse bid to improve their quality of life. Some 170,000 'dekassegui,' or Japanese Brazilians working in Japan, sent home $4 billion last year. The flows are so steady that federal bank Banco do Brasil used the remittances earlier this year to securitize a global bond issue. Hashimoto was due to fly to the capital of Brasilia later on Sunday. He will meet with President Fernando Henrique Cardoso on Monday to discuss Brazil's controversial auto import rules, environmental projects and the opening up of Brazilian ports to Japanese vessels. On Monday, Hashimoto was due to leave Brazil for Peru. He then travels to Costa Rica, where he is scheduled to meet with leaders of a number of Latin American nations. 2738 !E51 !E511 !ECAT !GCAT !GDIP Taiwan is prepared to restrict local manufacturers' investments in China if relations between Taipei and Beijing deteriorated, a local evening newspaper reported on Sunday. The island's top economic planning agency has drawn up measures, including altering its policy to restrict Taiwanese investment in the mainland, if tensions heightened in the Taiwan Strait, the China Times Express said. The newspaper, quoting a report by the cabinet's Council for Economic Planning and Development, said the government would also consider helping Taiwan businesses diversify their China-bound investments to southeast Asia and seek international support. Some 30,000 Taiwanese businesses have poured more than US$20 billion into China since the late 1980s. Although all investment projects in China must be accompanied by government approval, Taiwan is still concerned that its economy may become too dependent on China. Taiwan President Lee Teng-hui said earlier this month the island needs to review its policy of targeting China as its main market and avoid over-dependence on the mainland for investment. The report came one day after a Hong Kong newspaper report said Beijing had decided to continue the "economic united front" policy to put pressure on Taiwan instead of using strong-arm tactics against the island. Facing China's unpredictable and intimidatory war games in the Taiwan strait, the government should adopt policies to stabilise financial markets, encourage private and foreign investments and promote public projects, the Taiwan council's report said. If ties improved, Taiwan would then respond with the following goodwill gestures -- promoting agricultural exchanges and allowing visits by mainland high-technology experts, considering direct transportation links and promoting high-level official visits, it said. Taiwan and China have been rivals since a civil war separated them in 1949. 2739 !E51 !E512 !ECAT !GCAT !GDIP APEC officials say they have taken the first steps to integrate their 18 diverse Pacific Rim economies but warned against expecting early success in the goal of setting up the world's largest free trade region. Delegates to a senior officials meeting of Asia Pacific Economic Cooperation (APEC) which just ended in the southern Philippine city of Davao said they were satisfied with their three-day talks but thoughts of the long haul ahead tempered optimism. "You all should keep in mind that this is the first step on a journey that will roll over for a number of years... A good start has been made," U.S. delegation head John Wolf said at the weekend. The meeting was part of a series of talks to flesh out the Osaka Action agenda, unveiled last November in Japan, in time for the fourth summit of APEC leaders in November in the Philippines. APEC energy ministers and the region's businessmen are expected to meet in Sydney this week to discuss the role of private investment in the expanding energy industries of Asia. The action agenda is a general framework for a free trade regime APEC hopes to set up by the year 2010 for developed member-economies and year 2020 for developing economies. "Expectation ought not to be unbounded. One shouldn't expect to see the whole roadmap from now to 2010 and 2020," Wolf said. "The work still needs some distance to go... But all the signs point to a very positive direction," said Canadian chief delegate Leonard Edwards. The 18 economies in the APEC forum produce more than half the world's gross domestic product and contribute 46 percent of world merchandise exports. So far, member-economies have submitted the first revisions to their individual voluntary tariff reduction programmes. U.S. Assistant Trade Representative for Asia Pacific Robert Cassidy said commitments made by members in their tariff schemes were still not satisfactory. But he said he was pleased every economy was willing to improve its offer. Conference chairman Federico Macaranas of the Philippines said many economies had submitted action plans beyond what they committed in the World Trade Organisation. "That alone is reason for our saying we really have advanced the APEC process," he said. He likened the talks to solving a jigsaw puzzle where everyone wanted to start with his own piece. New Zealand's Christopher Butler, chairman of the committee on trade and investment, said members had agreed to align domestic standards with international norms by the year 2005 which will sharply cut the cost of cross-border trading. But collective action plans on intellectual property rights, deregulation, rules of origin, government procurement and dispute mediation have yet to be finalised. "This is not a journey of a week or a month or a year. It's a journey of 14 to 24 years. So, there is a need to be realistic about how much gets done within the year," Butler said. "When you look at what (it) has achieved relative to international benchmarks, it is quite extraordinary as to how far APEC has come." Delegates deflected a U.S. attempt to steamroll approval of an accord to bring down tariffs on information technology and telecommunication products to zero percent by year 2000. They referred the question to a committee for further study. They also tossed the issue of new members to another meeting. APEC groups Australia, Brunei, Canada, China, Chile, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Philippines, Taiwan, Thailand, Singapore and the United States. 2740 !E51 !E512 !ECAT !GCAT !GDIP Taiwanese vice-premier Hsu Li-teh is scheduled to leave for South Africa late on Sunday to cement business and diplomatic links as fears grow the island's biggest ally might switch ties to Beijing. Hsu, leading a large business delegation, was expected to meet South African President Nelson Mandela, government officials and trade and industry leaders during the 10-day mission, state media said on Sunday. The delegation consisted of officials and business leaders from major Taiwan state and private companies, such as Chinese Petroleum, China Steel, Taiwan Power, Chunghwa Telecom and Pacific Wire and Cable. Hsu was expected to visit Pretoria, Cape Town and Johannesburg before returning to Taipei on September 4, state media said. "The South African government pays a great attention to Hsu Li-teh's visit," state-funded radio quoted a foreign ministry official as saying. "The delegation will sign several economic cooperation and purchasing projects," the radio said without elaborating. The mass circulation United Daily News said both sides would discuss the island's imports of gold, coal, agricultural products and cars from South Africa and a possible petrochemical joint-venture deal. The Liberty Times said Taiwan plans to buy 600,000 tonnes of corn from South Africa and increase import quota for apples and oranges to 2,400 tonnes and 1,500 tonnes respectively. Hsu has said the main purpose of the visit was to review investment projects and seek new business opportunities. At least 278 Taiwanese businesses have invested US$1.5 billion in South Africa, and Taiwan is also considering an industrial zone for 20-40 of its major manufacturers. Taiwan's two-way trade with South Africa totalled $1.87 billion in 1995. South Africa is the biggest of Taipei's 30 diplomatic allies as of Monday after the West African state of Niger switched recognition to Beijing. Impoverished Niger split from Beijing to recognise Taipei in 1992. South Africa has openly expressed willingness to establish diplomatic ties with China. Its foreign minister Alfred Nzo made a high-profile "fact-finding" tour to Beijing in March, raising fears that Taiwan might lose its biggest diplomatic ally soon. Nzo visited Taiwan in June. Beijing says that countries seeking formal ties with China must first sever relations with what it regards as the "rebel" Republic of China government, which took refuge on Taiwan after losing a civil war to the communists in 1949. Taiwan foreign minister John Chang recently described relations with South Africa as "solid" and "stable". Despite a lack of diplomatic ties, South African trade ties with China have soared in recent years, fuelling pressure for formal recognition. 2741 !GCAT !GDIP !GPOL Five Burmese democracy activists recently jailed for seven years were being punished for fabricating reports about the nation's rice harvest, Burma's embassy in Thailand said in a report. The five were trying to trick the United Nations into believing that farmers were forced to work on agriculture projects that had failed, the embassy said in a letter to the Bangkok Post newspaper published on Sunday. The letter explaining the sentencing of the five and three others, imprisoned on separate charges, came as Burma's opposition leader Aung San Suu Kyi accused the military of intensifying its oppression of her National League for Democracy (NLD) party. Win Htein, one of Suu Kyi's aides, was among the five imprisoned for allegedly falsifying reports on the problem-hit rice harvest. "Under the instruction of Win Htein some NLD members, former members and local were sent out to collect information on agricultural developments," the embassy letter said. Two of Win Htein's team had "deliberately sent false information ... to Ms Suu Kyi's residence", it said. "Similiary, Hla Tun Aung and Kan Sien ... recorded with a video camera some few plots where summer paddy was not growing well," it said, naming two of Win Htein's team. "This was done with the intention of showing the recorded tape to Ms Suu Kyi and the NLD executive committee .... so that they can trick (United Nations organisations) into believing that the farmers are forced to work in a project which was a total failure," the letter said. Diplomats in Rangoon say the ruling military was highly sensitive about the local price of rice while at the same time was trying to boost rice exports to earn more foreign exchange. For several years, the government has been instructing farmers to grow two or three rice crops a year and authorities have also tried to increase rice production by expanding irrigation. In many areas villagers have been ordered to work, for little if any pay, to build irrigation systems, the diplomats say. Since last year, Burma's rice harvest has been badly hit by pests, which, according to some experts, could be a result of the new multiple cropping. "In 1995 and 1996, Burma's paddy production began to be adversely affected by infestation of small insects that eat the rice kernel inside of the paddy husk," the U.S. embassy in Rangoon said in a recent report. "This infestation is thought by some agricultural experts to be associated with multiple cropping of paddy, which may provide a continuous food supply for paddy-eating insects whose numbers had previously been limited by the absence of paddy during much of the year," the U.S. report said. Burma was one of Asia's leading rice exporters until a 1962 military coup and the subsequent introduction of isolationist, socialist-style economic policies. The current ruling military council introduced economic reforms after it was set up in 1988 and Burma exported slightly more than one million tonnes of milled rice in the 1994/95 financial year, which runs from April 1 to March 31, according to government figures. Industry sources and diplomats estimate some 600,000 to 700,000 tonnes was exported in the subsequent year. 2742 !GCAT !GSPO Finnish authorities launched a full inquiry on Saturday after a spectator was killed and 28 injured in an accident at the start of the world championship 1,000 Lakes Rally. Police stressed that normal safety precautions had been taken while some experts blamed driver error for the death of 45-year-old Ludo Briers from Alken in Belgium after a competing car ploughed into the crowd on Friday evening. "It was a flagrant driver mistake," Kari Sohlberg, a Finnish member of the sport's governing International Automobile Federation, said on television. A car driven by Dane Richardt Karsten (corrects) went into the crowd of onlookers during the opening two-kilometre stage held on closed public roads in the host city of Jyvaskyla. Police on Saturday evening could give no firm indication about the likely cause of the crash, but organisers said the sump guard of Karsten's car was bent as it came off the road, "making the car act like a sledge". "The car slid without any possible control up the escape road," organisers said in a statement. The four-day rally, suspended after the accident, resumed on Saturday. A police spokesman said the Finnish accident investigation board would look into the crash after an initial police inquiry, adding that police had made the usual course checks before the event and approved safety arrangements. The crowd was standing at least 60 metres from the road when the Mitsubishi of Karsten and his co-driver Ole Frederiksen left the road. The two Danes were shocked but not seriously injured and both both made statements to police soon after the crash. Twelve people were still in hospital on Saturday evening, two -- a second Belgian and a Finn -- with serious injuries, but doctors said their condition was stable. Organisers on Saturday said a total of four Belgians, a French person and an Italian were among the injured. Police began a thorough check of Karsten's car on Saturday but could not say how long the inquiry would take. "Everything seemed to be in order to make the race possible," Simo Lampinen, head of the organising committee, was quoted as saying in the daily newspaper Helsingin Sanomat. A spokeswoman for the organisers said the spectators had been standing at the same distance from the road as in previous years. A young woman was killed before last year's rally when she stepped in front of a car practising on the course. 2743 !GCAT !GSPO Scores after the final round of the $2.1 million NEC World Series of Golf at Firestone C.C, 7149 yards, par 70 (players U.S. unless noted): 274 Phil Mickelson 70 66 68 70 277 Duffy Waldorf 70 70 71 66, Steve Stricker 68 72 69 68, Billy Mayfair 66 71 70 70 278 Greg Norman (Australia) 70 68 69 71 280 Alexander Cejka (Germany) 72 71 71 66, Davis Love 70 74 67 69 281 John Cook 70 69 71 71 282 Corey Pavin 73 70 70 69 283 Tom Lehman 72 69 74 68, Fred Funk 72 70 73 68, Mark Brooks 69 69 74 71, Nick Faldo (Britain) 70 71 68 74 284 D.A. Weibring 73 69 74 68, Tim Herron 70 67 75 72, Mark O'Meara 73 71 69 71, Jim Furyk 75 69 67 73, Justin Leonard 69 70 71 74 285 Loren Roberts 72 73 71 69, Hal Sutton 72 69 74 70, Fred Couples 73 68 72 72, Craig Stadler 73 72 67 73 286 Hidemichi Tanaka (Japan) 66 75 75 70, Steve Jones 70 69 76 71, Paul Goydos 66 75 74 71, Ernie Els (South Africa) 71 71 71 73 287 Costantino Rocca (Italy) 74 71 75 67, Clarence Rose 72 71 72 72, Craig Parry (Australia) 73 75 67 72, Willie Wood 75 69 69 74 288 Shigeki Maruyama (Japan) 75 71 70 72, Anders Forsbrand ( Sweden) 70 75 71 72 289 Scott Hoch 71 68 77 73 290 Tom Watson 79 70 68 73 292 Wayne Westner (South Africa) 77 68 73 74, Sven Struver ( Germany) 72 72 72 76 294 Satoshi Higashi (Japan) 75 72 74 73, Scott McCarron 76 70 74 74 295 Stewart Ginn (Australia) 73 72 77 73 298 Steve Schneiter 77 74 76 71, Paul Stankowski 74 75 74 75, Seiki Okuda (Japan) 81 70 72 75 301 Brad Bryant 73 72 77 79 2744 !GCAT !GSPO Fifth-seed Andrei Medvedev of Ukraine beat unseeded Martin Damm from the Czech Republic 7-5 6-3 to win the Waldbaum Hamlet Cup tennis tournament on Sunday. It was Medvedev's 10th career ATP Tour title, but his first since winning in Hamburg last year. It also was his first hardcourt victory and U.S. final appearance since beating Petr Korda, Czech Republic, three years ago in New Haven, Connecticut. Damm, who lost the last four games of the match, and hastened his own defeat with doublefaults, is still seeking his first tournament victory. "This was a big win for me," said Medvedev who had been accepted into the tournament as a wild card two days before the draw was made. It gives me a lot of confidence going into the U.S. Open." He will meet France's Jean-Philippe Fleurian in the first round and is in fifth-seeded Richard Krajicek's quarter and in the same half with top-seed Pete Sampras, the defending champion. "I like the way I was hitting my shots," Medvedev said. "He (Damm) served well early in the match but when I broke him in the last game of the first set I felt I could do anything." Staying on the baseline, Medvedev, who will improve his No. 38 ranking with the win, dueled on service through four games of the second set. He suddenly misfired three times and lost service in the fifth game. But Damm doublefaulted three times and lost the next game. Medvedev served three aces in the seventh game, Damm doublefaulted again to lose the eighth game and Medvedev, who ranked fourth two years ago and feels he is on his way back to the Top Ten, held service at love to end the match. The doubles final was won by brother Luke and Murphy Jensen, unseeded Americans. They beat the unseeded wild card team of Hendrik Dreekmann, Germany, and Alexander Volkov, Russia, 6-3 7- 6 (7-5). 2745 !GCAT !GSPO Results at the Hamlet Cup tennis tournament on Sunday (prefix number denotes seedings: Finals, singles 5-Andrei Medvedev (Ukraine) beat Martin Damm (Czech Republic) 7-5 6-3 Finals, doubles Luke Jensen and Murphy Jensen (U.S.) beat Alexander Volkov (Russia) and Handrik Dreekmann (Germany) 6-3 7-6 (7-5) 2746 !GCAT !GSPO "The force" was with Kimiko Date on Sunday, taking her to a 3-6 6-3 6-0 victory over Arantxa Sanchez Vicario and the championship of the Toshiba Tennis Classic. "It's difficult to say if I was playing my best tennis in the last two sets," said Date through a translater. "Of course in the third set I was playing my best. But in the second set, I was just playing by some unknown driving force behind from me. Whatever it was, "I am happy to win," said the bashful Date after notching her second title of the year along with the $79,500 winner's check in the one-hour-50-minute come-from-behind victory. Date began slowly, spotting Sanchez Vicario a quick one-set lead before turning up her deadly ground game to beat the world's No. 2 ranked player for only the second time in 10 meetings. "When I was in good form there's a certain rhythm and form. But today it was something different." After finishing runnerup here to co-world No. 1 Steffi Graf, Sanchez Vicrio was trying to make the third time a charm. But Date's scintillating play dismissed that hope. "I think always when you get so close and you have chances to win and you lose, you feel little disappointed. I think Kimiko played really well. It's not that I lost the match, I guess that she won the match." Date said she was determined after the shellacking she took in the opening set. "When I lost the first set, I wasn't discourged," she said. "I thought, if I can enjoy playing and stick to my game plan, and play my best tennis, I knew I had enough chances." Date quickly levelled the match taking the second set after racing out to a 5-1 lead against the feisty Spaniard. She assumed control and dominated in the decisive set, cracking flat, seering forehands, sharply angled backhands, powerful overheads and deft drop volleys which kept the cat-like Spanard off-balance. "You know it's coming hard but it's the angles that she makes," explained Sanchez Vicario of Date's lethal ground game. "She plays really close the lines but she makes the wide angles. The ball is sliding even more, so you have to make either a winner on the other side because it leaves the court open for her. "It's so hard to read where she's going to hit. That's the most difficult thing from her game. It's hard to see where the ball is going to come." Sanchez Vicario employed everything in her arsenal but Japan's top player was unstoppable in third set, drilling 15 of her 42 winners, while committing just five of her 32 unforced errors. "I couldn't go to the net because she was hitting so many winners and so many angles," said the dispirited Spanaird. "I have to go for the shots and I make so many unforced errors. But she makes winners, that's her game. Either it can go in or long. Today she made the right moment the good shots." For Sanchez Vicario it stretched her finals futility to five this summer following runnerup finishes at the French Open and Wimbledon to co-world No. 1 Graf, the Olympic gold medal to American Lindsay Davenport and the Canadien Open to Monica Seles, the world's other top player. "I would have to worry more if I don't get to the finals," said Sanchez, who has won two of eight titles in l996. "But only two players get to the finals and most of the players would like to get in my position. I know I lost five finals but I'm very happy with the way things are going." 2747 !GCAT !GSPO Results from the $450,000 Toshiba Classic tennis tournament on Sunday (prefix number denotes seeding): Finals: 4-Kimiko Date (Japan) beat 1-Arantxa Sanchez Vicario (Spain) 3-6 6-3 6-0. 2748 !GCAT !GSPO Russian Alexander Popov, the only man to retain the Olympic 50 and 100 metre freestyle titles, underwent an emergency operation on Sunday after being stabbed on a street in south-west Moscow. But the smiling 24-year-old told NTV television he was in no danger and promised he would be back in the pool shortly. "There's no need to worry. We're going to be walking soon -- and swimming," he insisted cheerfully from his bed in the intensive care ward of Hospital No 31 in the Russian capital. A senior member of the medical team told ORT television: "We hope that developments after the operation will be normal. We have every reason to believe so." Itar-Tass news agency quoted police as saying that Popov was stabbed in the abdomen around 11 p.m. (1900 GMT) on Saturday after arguing with a group of roadside watermelon sellers. Popov, who successfully defended the 50 and 100 titles at the Atlanta Olympics, underwent surgery overnight. Russian swimming federation head Gennady Aleshin said the wound had affected a lung and Popov's kidneys. No arrests were made and police were still investigating the incident. Tass said Prime Minister Viktor Chernomyrdin was outraged by the attack and had ordered the health authorities to ensure the double Olympic champion was given the best possible treatment. 2749 !GCAT !GSPO World championship leader Tommi Makinen achieved the remarkable feat of being quickest on all 12 of the day's stages to grab a slim lead on the second day of the 1,000 Lakes Rally on Sunday. The Finn, who began the day in his Mitsubishi 42 seconds behind compatriot Juha Kankkunen, will begin the final day on Monday 12 seconds ahead of the Toyota driver. "I tried to go as fast as possible," Makinen said. "I think we can keep our position." Kankkunen appeared more effected by the unusually slippery conditions and said afterwards: "I've never had such a difficult day in the 1,000 Lakes." Another Finn, Toyota driver Marcus Gronholm, was clinging to third place despite hitting a post. But the pressure on him was eased when compatriot Jarmo Kytolehto in a Ford had clutch trouble on the last two stages. Swedish Subaru driver Kenneth Eriksson in fifth place failed to mount a challenge when his tyres proved less effective on the mostly sandy stages and he is now under pressure from Spaniard Carlos Sainz, who gained two places during the second leg in his Ford. 2750 !GCAT !GSPO Leading positions on Sunday after 23 special stages in the 1,000 Lakes Rally, sixth round of the world championship: 1. Tommi Makinen (Finland) Mitsubishi Lancer three hours eight minutes one second 2. Juha Kankkunen (Finland) Toyota Celica 12 seconds behind 3. Marcus Gronholm (Finland) Toyota Celica 2:09 4. Jarmo Kytolehto (Finland) Ford Escort 2:23 5. Kenneth Eriksson (Sweden) Subaru Impreza 2:39 6. Carlos Sainz (Spain) Ford Escort 3:03 2751 !GCAT !GSPO Leading results in the Swedish 500cc motocross Grand Prix on Sunday: First race 1. Joel Smets (Belgium) Husaberg 2. Peter Johansson (Sweden) Husqvarna 3. Gert Jan Van Doorn (Netherlands) Honda 4. Jacky Martens (Belgium) Husqvarna 5. Peter Dirkx (Belgium) KTM 6. Danny Theybers (Belgium) Honda Second race 1. Shayne King (New Zealand) KTM 2. Martens 3. Theybers 4. Johan Boonen (Belgium) Husqvarna 5. Dietmar Lalcher (Germany) Honda 6. Claus Manne Nielsen (Denmark) KTM Overall on day: 1. Martens 30 points 2. Shayne King 28 3. Smets 27 4. Theybers 25 5. Van Doorn 24 6. Johansson 17 World championship standings (after 11 of 12 rounds): 1. Shayne King 323 points 2. Smets 290 3. Johansson 236 4. Lacher 219 5. Darryll King (New Zealand) Honda 178 6. Van Doorn 176 2752 !GCAT !GSPO Leading results in the German 125cc motocross Grand Prix on Sunday: First race 1. Sebastien Tortelli (France) Kawasaki 2. Bob Moore (U.S.) Yamaha 3. Luigi Seguy (France) TM 4. Andi Kanstinger (Germany) Honda 5. Nicolas Charlier (France) Kawasaki 6. Erik Camerlengo (Italy) Yamaha Second race 1. Tortelli 2. Moore 3. Alex Belometti (Italy) Honda 4. Frederic Vialle (France) Yamaha 5. Collin Dugmore (South Africa) Honda 6. Camerlengo Overall on day: 1. Tortelli 40 points 2. Moore 34 3. Seguy 24 4. Vialle 22 5. Camerlengo 20 6. Belometti 19 Final world championship standings: 1. Tortelli 432 points 2. Paul Malin (Britain) Yamaha 317 3. Vialle 293 4. Seguy 192 5. Michele Fanton (Italy) Kawasaki 160 6. Dugmore 152 2753 !GCAT !GSPO A goal each from new signings Jordi Cruyff and Ole Gunnar Solskjaer allowed premier league champions Manchester United to come twice from behind and force a 2-2 draw with 1995 champions Blackburn Rovers at Old Trafford on Sunday. Blackburn, still smarting from the pre-season loss of England striker Alan Shearer to Newcastle United and the departure last week of director of football Kenny Dalglish, deserved their share of the points as they took the game to the champions. Paul Warhurst put Blackburn ahead after 34 minutes but a mistake by centre-back Colin Hendry five minutes later allowed Dutch international Cruyff to steal in for the equaliser as he scored his second goal of the season. After a penalty appeal was turned down, Blackburn reclaimed the lead six minutes into the second half through Norwegian Lars Bohinan. But Manchester United pressed forward and the Norwegian Solksjaer, in his first game for the club, squared the match seven minutes after coming on as a 63rd minute substitute. 2754 !GCAT !GSPO Former Olympic and world 100 metres champion Linford Christie finished third in his final international race on British soil on Sunday then confirmed he would retire at the end of the season. Christie, 36, finished behind Nigeria's Osmond Ezinwa and compatriot Ian Mackie. It was the first time for 10 years that he had been beaten by a British runner. Afterwards Christie confirmed that he was still considering running in the grand prix final in Milan on September 7 but was then definitely quitting international athletics. "There's no turning back," Christie said in a halting voice at a post-race news conference. "I've kept changing my mind in the past but it has not been a hard decision to make. I am good, I have been good but all good things have to come to an end. "I've given a lot of my life to athletics but athletics is not my life. The best things are when you remember the highs." Cool and overcast conditions kept performances to a modest level on Sunday. The competitive highlight was Sarka Kasparkova's triple jump of 14.84 metres, close to the distance that brought the Czech athlete an Olympic bronze medal last month. Behind her Britain's Ashia Hansen, fourth in Atlanta, jumped a national best of 14.78 metres. Three Olympic champions recorded victories. American Charles Austin cleared 2.30 metres to win the high jump from Australia's Tim Forsyth, who recorded the same height but had more failures throughout the competition. Austin's compatriot Allen Johnson won the 110 metres hurdles in 13.23 seconds, just holding off Britain's Tony Jarrett while Norway's Verbjorn Rodal took the 800 metres in one minute 44.93 seconds. Kenya's William Tanui, the 1992 Olympic 800 metres gold medallist, won the Emsley Carr Mile in 3:54.57 after leading from the first lap. The race was inaugurated in 1953 and the trophy is a specially bound book recording the history of miling. Previous winners include former world record holders Jim Ryun, John Walker and Sebastian Coe. Tanui is the first Kenyan to win the race since Kipchoge Keino in 1966. 2755 !GCAT !GSPO Frankie Dettori and Willie Carson each picked up four day bans on Sunday, starting on Tuesday, for careless riding in the Group Three Prix de la Nonette. Carson rode John Dunlop's Bint Salsabil to a neck victory over fellow English trainee and Hamdan al Maktoum-owned Bint Shadayid, with Luna Wells a further length back. However, both Bint Salsabil and Bint Shadayid were demoted a place to second and third after being found guilty of hampering the favourite Luna Wells. The Group One winning Luna Wells had not raced since failing in the French Oaks in June but thanks to the intervention of the stewards the Andre Fabre runner was able to record her third Group win of the season. British trainer Paul Cole further underlined his remarkable affinity with the Grand Prix de Deauville run over 12-1/2 furlongs by capturing the Group Two prize for a fourth time with Strategic Choice. Cole's previous wins in the big Normandy prize were gained with Ibn Bey in 1988 and the remarkable globetrotting, Snurge, who landed the 1991 and 1993 editions. Strategic Choice, bouncing back from a King George VI and Queen Elizabeth Diamond Stakes disappointment, was always to the fore as the Whatcombe raider initially tracked his compatriot High Baroque before taking it up down the backstretch. Strategic Choice always looked to be in the driving seat and the Irish St Leger and Gran Premio di Milano hero held on gamely to win by a neck from Tarator. Percutant was a short head further back in third, with Helen of Spain, the only filly in the race, a length further back. 2756 !GCAT !GSPO Russian Alexander Popov, the only man to retain the Olympic 50 and 100 metre freestyle titles, was in intensive care on Sunday after being stabbed on a street in south-west Moscow, Itar-Tass news agency said. A hospital spokesman said his condition was "serious and unstable". Itar-Tass quoted police as saying that Popov, 24, was stabbed in the abdomen around 11 p.m. (1900 GMT) on Saturday after arguing with a group of roadside watermelon sellers. Popov, who successfully defended the 50 and 100 titles at the Atlanta Olympics, underwent surgery overnight and remained in intensive care. Russian swimming federation head Gennady Aleshin said the wound had affected a lung and Popov's kidneys. No arrests were made and the police were still investigating the incident. Tass said Prime Minister Viktor Chernomyrdin was outraged by the attack and had ordered the health authorities to ensure the double Olympic champion was given the best possible treatment. 2757 !GCAT !GSPO Leading placings in Sunday's Pokka 1,000 km motor race, seventh round of the International Endurance GT championship: 1. Ray Belim (Britain)/James Weaver (Britain)/J.J.Lehto (Finland) Gulf McLaren FI GTR 171 laps - 6 hours 18 minutes 48.637 seconds (average speed 158.82 kph) 2. Anders Olofsson (Sweden)/Luciano della Noce (Italy) Ennea Ferrari F40 170 laps 3. Andy Ballace (Britain)/Olivier Grouillard (France) Harrods McLaren FI GTR 169 4. Thomas Bscher(Germany)/Peter Kox (Netherlands) West McLaren F1 GTR 168 5. Fabien Giroix (France)/Jean-Denis Deletraz (Switzerland) Muller McLaren F1 GTR 167 6. Lindsay Owen-Jones (Britain)/Pierre-Henri Raphanel (France)/David Brabham (Australia) Gulf McLaren F! GTR 167 7. Jean-Marc Gounon (France)/Eric Bernard (France)/Paul Belmondo (France) Ennea Ferrari F40 167 8. Bruno Eichmann (Germany)/Gerd Ruch (Germany)/Ralf Kelleners (Germany) GT2 Roock Porsche 911 164 9. Stephane Ortelli (France)/Bob Wollek (France)/Franz Konrad (Austria) GT2 Konrad Porsche 911 164 10. Cor Euser (Netherlands)/H.Wada (Japan)/N.Furuya (Japan) GT2 Marcos LM600 162 Fastest lap: Gounon, 2 minutes 03.684 seconds (170.680 kph) Championship standings after seven rounds: 1. Belim, Weaver 156 points 2. Eichmann, Ruch 116 3. Bscher 112 4. Gounon, Bernard, Belmondo 98 5. Olofsson, della Noce 93 6. Owen-Jones, Raphanel 82 2758 !GCAT !GSPO England all-rounder Chris Lewis's international future was in doubt after he was dropped from the one-day squad to face Pakistan later this week for turning up late on the fourth day of the final test on Sunday. Lewis, who said his car suffered a puncture, did not arrive in The Oval dressing-room until 35 minutes before play was scheduled to start and was duly informed his place in the squad had been awarded to uncapped Kent fast bowler Dean Headley. Chairman of selectors Ray Illingworth and coach David Lloyd, who took a joint decision along with skipper Michael Atherton to remove Lewis's name from the squad, were both clearly unimpressed by the Surrey player's excuse. Illingworth described the explanation as "unsatisfactory" and Lloyd admitted he felt "let down" by a player who only returned to international cricket this season. "It's a tough action, but that's the way we feel about it. Michael spent 10 minutes with him and his explanation was unsatisfactory," said Illingworth, who said he did not know if the player had spent the night at home or in the team hotel. Lloyd confirmed Lewis, who lives less than three miles away from the Oval in Chelsea Harbour, had not phoned to warn he would be late. An England official rang Lewis on his mobile phone, but discovered it had been switched to ansaphone mode. Lewis, who owns a top-of-the-range Mercedes convertible, was also late for the first one-day international against India earlier in the season. Despite a fine piece of fielding which brought a run-out early in the first hour of the day on Sunday, his chances of making England's tour to Zimbabwe and New Zealand now look remote. "It won't do them any good," Illingworth said dryly. "They're not decisions you like to make. But we have to get the message through that the rewards of playing for England are high and the discipline has to be there as well." The mercurial Lewis, 28, has endured an increasingly disappointing season after being recalled to the England set-up, only just managing to hold his place for the Oval after an unimpressive display at Headingley in the previous test. The all-rounder, who has played 32 tests and 51 one-day internationals, is not exactly a stranger to controversy but, ironically, has claimed to have rediscovered his motivation since moving back to London to live closer to his family following stints with Leicestershire and Nottinghamshire. The Lewis rumpus totally overshadowed the surprise inclusion of Graham Lloyd, the coach's son, in a much-changed squad of 13. Four others in the team contesting the final test at the Oval have been either dropped or rested, with Lancashire batsman Lloyd, Surrey all-rounder Adam Hollioake and Headley all in line for international debuts. Darren Gough, Matthew Maynard, Ronnie Irani and Peter Martin have been recalled to the international set-up, with Dominic Cork, Nasser Hussain, John Crawley and Ian Salisbury all missing along with 12th man Andy Caddick and test discard Graeme Hick. Illingworth said Cork had been left out as much for his expensive recent bowling figures as anything else and indicated the Derbyshire player might be left behind to work on his fitness rather than touring with England this winter. Squad: Michael Atherton (captain), Alec Stewart, Graham Thorpe, Nick Knight, Graham Lloyd, Matthew Maynard, Ronnie Irani, Adam Hollioake, Robert Croft, Darren Gough, Peter Martin, Dean Headley, Alan Mullally. 2759 !GCAT !GSPO Leading results at an international meeting on Sunday: Women's triple jump 1. Sarka Kasparkova (Czech Republic) 14.84 metres 2. Ashia Hansen (Britain) 14.78 3. Rodica Matescu (Romania) 14.18 Women's 400 metres hurdles 1. Deon Hemmings (Jamaica) 55.13 seconds 2. Anne Marken (Belgium) 55.90 3. Susan Smith (Ireland) 56.00 Women's javelin 1. Isel Lopez (Cuba) 61.36 2. Louise McPaul (Australia) 60.66 3. Silke Renk (Germany) 60.66 Women's 200 metres 1. Cathy Freeman (Australia) 22.53 2. Falilat Ogunkoya (Nigeria) 22.58 3. Juliet Cuthbert (Jamaica) 22.77 100 metres hurdles 1. Dionne Rose (Jamaica) 12.83 2. Michelle Freeman (Jamaica) 12.91 3. Gillian Russell (Jamaica) 12.95 Women's 800 metres 1. Charmaine Crooks (Canada) two minutes 00.42 seconds 2. Inez Turner (Jamaica) 2:01.98 3. Margaret Crowley (Australia) 2:02.40 Men's pole vault 1. Trond Bathel (Norway) 5.60 2. Pat Manson (U.S.) 5.60 3. Tim Lobinger (Germany) 5.50 Men's javelin 1. Tom Pukstys (U.S.) 86.82 2. Steve Backley (Britain) 82.20 3. Nick Nieland (Britain) 81.12 Women's 400 metres 1. Marcel Malone (U.S.) 51.50 2. Kim Graham (U.S.) 52.17 3. Phylis Smith (Britain) 52.53 Men's 200 metres 1. Jeff Williams (U.S.) 20.45 2. Doug Turner (Britain) 20.48 3. John Regis (Britain) 20.63 Men's high jump 1. Charles Austin (U.S.) 2.30 2. Tim Forsyth (Australia) 2.30 3. Patrik Sjoberg (Sweden) 2.25 Men's 800 metres 1. Verbjorn Rodal (Norway) 1:44.93 2. Benson Koech (Kenya) 1:45.96 3. Vincent Malakwen (Kenya) 1:46.18 Men's mile 1. William Tanui (Kenya) 3:54.57 2. John Mayock (Britain) 3:54.60 3. Tony Whiteman (Britain) 3:54.87 Men's 400 metres 1. Roger Black (Britain) 45.05 2. Mark Richardson (Britain) 45.38 3. Derek Mills (U.S.) 45.48 Men's 100 metres 1. Osmond Ezinwa (Nigeria) 10.06 2. Ian Mackie (Britain) 10.17 3. Linford Christie (Britain) 10.19 2760 !GCAT !GSPO DEAUVILLE, France, Aug 25 (France) - Result of the Grand Prix de Deauville for three-year-olds and upwards run over 12-1/2 furlongs (2.5 km) on Sunday: 1. Strategic Choice (Richard Quinn) 2. Tarator (Olivier Peslier) 3. Percutant (Dominique Boeuf) 4. Helen of Spain (Thierry Jarnet) Nine ran. Distances: A neck, a short head, 1 length. Winner owned by Martyn Arbib and trained by Paul Cole in England. Value to the winner: 102,108 dollars. Pari-Mutuel (to a one franc stake): Win 8.00; places 2.20, 1.30, 2.30. Dual Forecast 11.40. 2761 !GCAT !GSPO Result of Sunday's Belgian Grand Prix motor race: 1. Michael Schumacher (Germany) Ferrari 1 hour 28 minutes 15.125 seconds (average speed 208.442 kph) 2. Jacques Villeneuve (Canada) Williams 5.602 seconds behind 3. Mika Hakkinen (Finland) McLaren 15.710 4. Jean Alesi (France) Benetton 19.125 5. Damon Hill (Britain) Williams 29.179 6. Gerhard Berger (Austria) Benetton 29.896 7. Mika Salo (Finland) Tyrrell 1:00.754 8. Ukyo Katayama (Japan) Tyrrell 1:40.227 9. Ricardo Rosset (Brazil) Arrows one lap 10. Pedro Lamy (Portugal) Minardi one lap Did not finish: 11. David Coulthard (Britain) McLaren 37 laps completed 12. Martin Brundle (Britain) Jordan 34 13. Eddie Irvine (Britain) Ferrari 29 14. Rubens Barrichello (Brazil) Jordan 29 15. Pedro Diniz (Brazil) Ligier 22 16. Jos Verstappen (Netherland) Arrows 11 Did not start (failed to complete one lap): Olivier Panis (France) Ligier Johnny Herbert (Britain) Sauber Heinz-Harald Frentzen (Germany) Sauber Fastest lap: Berger 1:53.067 (221.857 kph) 2762 !GCAT !GSPO World champion Michael Schumacher of Germany upset the odds and the expected duel between the Williams' top drivers on Sunday when he drove to a brilliant victory in the Belgian Grand Prix. Schumacher, in a Ferrari, secured his second victory of the season with an astute and well-judged drive on the circuit where he made his Formula One debut in 1991 and claimed his first victory in 1992. It was the 21st win of his career and prompted emotional celebrations by a vast army of his German fans after he came home 5.6 seconds ahead of Canadian Jacques Villeneuve in a Williams. In the other Williams, Damon Hill of Britain could finish only fifth and saw his lead over team mate Villeneuve in the world driver's championship cut to 13 points. Villeneuve, who started from pole position, led through the opening laps but was outmanouvered when the safety car was introduced following an accident involving Arrows' driver Jos Verstappen. The Dutchman walked away from his car without serious injury although he was later taken to hospital in a neck brace. Schumacher's quick thinking in making an immediate pitstop was his most decisive move and put him in a position to claim an unexpected victory, his and Ferrari's first since the Spanish Grand Prix in Barcelona in early June. Finland's Mika Hakkinen, in a McLaren, came home third 15 seconds behind the Canadian and ahead of Frenchman Jean Alesi in a Benetton. Hill was fifth and Austrian Gerhard Berger who finished sixth for Benetton. Villeneuve's second place earned him six points and with three races remaining he cut Hill's advantage from 17 to 13 points. Hill now has 81 points and Villeneuve 68 points. Meanwhile, Schumacher jumped to third in the title race with 39 points although he cannot stop either of the Williams' men succeeding him as champion. After the race, the German said he had made the important pitstop because his fuel tank was virtually empty and admitted it was stroke of luck. He added he had suffered no discomfort in the car from his big accident on Friday morning when he bruised his knee severely. "It is difficult to put into words after being nearly 1.4 seconds behind in qualifying and then so far behind again this morning in the warm-up," he said. "I had problems in the middle of the race and was worried about my steering but after making the pitstop, everything was okay." Schumacher added: "After last year (when he won after starting 16th on the grid) I thought that maybe my injury and everything else was a good omen but I still wouldn't have bet a penny on winning this race. It was a stroke of luck." He said Ferrari's new seven-speed gearbox had been a great help but refused to be drawn into any predictions of maintaining the Italian team's revival in the next race, their home Grand Prix at Monza. Villeneuve admitted he was disappointed that he had not been able to reduce Hill's championship lead even further. "It was a good chance to pile a few points up on Damon, so yes, I'm disappointed," he said. "This was because of our miscommunication about the pitstop. I didn't understand what I was being told and didn't come in when I wanted to." Hill's race was another disappointment for him and saw his early season grip on the championship loosened further by the combined threat of his own team mate and the Ferrari resurgence. It was his fourth successive poor start which caused most damage as he lost second position on the grid and found himself fourth at the end of the first lap. From then on, he was always fighting an uphill battle and his cause suffered further with another badly-timed pitstop when he came in much later than required after the safety car was introduced. Hill rejoined in 11th place with no chance of winning and, for once, he had to be thankful to his old rival Schumacher for preventing Villeneuve carving even deeper into his championship lead. 2763 !GCAT !GSPO Michael Schumacher of Germany, driving a Ferrari, won the Belgian Grand Prix motor race on Sunday. Canada's Jacques Villeneuve finished second in his Williams and Mika Hakkinen of Finland was third in a McLaren. Frenchman Jean Alesi came fourth in his Benetton with Britain's Damon Hill fifth in a Williams and Gerhard Berger of Austria sixth in the other Benetton. World drivers' championship standings (after 13 rounds): 1. Damon Hill (Britain) 81 points 2. Jacques Villeneuve (Canada) 68 3. Michael Schumacher (Germany) 39 4. Jean Alesi (France) 38 5. Mika Hakkinen (Finland) 23 6. David Coulthard (Britain) 18 7. Gerhard Berger (Austria) 17 8. Olivier Panis (France) 13 9. Rubens Barrichello (Brazil) 12 10. Eddie Irvine (Britain) 9 11. Heinz-Harald Frentzen (Germany) 6 12. Mika Salo (Finland) 5 13. Johnny Herbert (Britain) 4 14. Martin Brundle (Britain) 3 15 equal. Jos Verstappen (Netherlands) 1 15 equal. Pedro Diniz (Brazil) 1 Constructors' championship: 1. Williams 149 points 2. Benetton 55 3. Ferrari 48 4. McLaren 41 5. Jordan 15 6. Ligier 14 7. Sauber 10 8. Tyrrell 5 9. Footwork 1 2764 !GCAT !GSPO England all-rounder Chris Lewis's international future was left in doubt on Sunday after he was dropped from the one-day squad to face Pakistan later this week for turning up late on the fourth day of the final test. Lewis did not arrive in The Oval dressing-room until 35 minutes before play was scheduled to start and was duly informed he had been replaced in the squad by uncapped Kent fast bowler Dean Headley. "Lewis was in the original squad but because of events this morning disciplinary action has been taken," said chairman of selectors Ray Illingworth, confirming that he, skipper Michael Atherton and coach David Lloyd had taken a joint decision. "It's a tough action but that's the way we feel about it. Michael spent 10 minutes with him and his explanation was unsatisfactory," added Illingworth, who said he did not know if the player had spent the night at home or in the team hotel. There were reports that Lewis was delayed after forgetting his blazer. Despite a fine piece of fielding which brought a run-out early in the first hour of play on Sunday, his chances of making England's tour to Zimbabwe and New Zealand now look remote. "It won't do them any good," Illingworth said dryly. "They're not decisions you like to make. But we have to get the message through that the rewards of playing for England are high and the discipline has to be there as well." The mercurial Lewis, 28, has endured an increasingly disappointing season after being recalled to the England set-up at the start of the season, only just managing to hold his place for The Oval test despite an unimpressive display at Headingley in the previous test. The Surrey player, who has played 32 tests and 51 one-day internationals, is not exactly a stranger to controversy but, ironically, has claimed to have rediscovered his motivation since moving back to London to live closer to his family following stints with Leicestershire and Nottinghamshire. The Lewis rumpus overshadowed the surprise inclusion of Graham Lloyd, son of David, in a much-changed squad of 13. Four others in the team contesting the final test at The Oval have been either dropped or rested, with Lancashire batsman Lloyd, Surrey all-rounder Adam Hollioake and Headley all in with a chance of international debuts. Darren Gough, Matthew Maynard, Ronnie Irani and Peter Martin have been recalled to the international set-up, with Dominic Cork, Nasser Hussain, John Crawley and Ian Salisbury all missing along with 12th man Andy Caddick and test discard Graeme Hick. Illingworth said Cork had been left out as much for his expensive recent bowling figures as anything else and indicated that the Derbyshire player might be left behind to work on his fitness rather than touring with England this winter. Squad: Michael Atherton (captain), Alec Stewart, Graham Thorpe, Nick Knight, Graham Lloyd, Matthew Maynard, Ronnie Irani, Adam Hollioake, Robert Croft, Darren Gough, Peter Martin, Dean Headley, Alan Mullally. 2765 !GCAT !GSPO Leading positions after six of Sunday's 12 special stages in the 1,000 Lakes Rally, sixth round of the world championship: 1. Juha Kankkunen (Finland) Toyota Celica 2 hours 30 minutes 52 seconds 3. Tommi Makinen (Finland) Mitsubishi Lancer 8 seconds behind 2. Marcus Gronholm (Finland) Toyota Celica 1:46 4. Jarmo Kytolehto (Finland) Ford Escort 1:56 5. Kenneth Eriksson (Sweden) Subaru Impreza 2:05 6. Thomas Radstrom (Sweden) Toyota Celica 2:23 2766 !GCAT !GSPO A relentless attack by Finn Tommi Makinen all but wiped out Juha Kankkunen's lead on the second day of the 1,000 Lakes Rally, sixth round of the world championship, on Sunday. Makinen set fastest times in the day's first six stages in his Mitsubishi to cut his compatriot's lead from 42 seconds to eight, despite nearly smashing the front of his car on a high-speed jump. "I can go a bit faster but it's too much of a risk," Makinen said. Toyota driver Kankkunen was suffering from an upset stomach and was running first -- sweeping the surface free of gravel for his rivals just as Makinen did on Saturday. A fierce battle developed for third place between Finns Marcus Gronholm and Jarmo Kytolehto and Subaru driver Kenneth Eriksson. Eriksson had to call on a chiropractor after damaging his back on a flat-out jump. "It was hurting so badly for 200 metres that I thought I must stop. It was like a knife in the back," said the Swede. Spain's double world champion Carlos Sainz climbed to seventh in his factory-entered Ford Escort when Finn Harri Rovanpera rolled his privately-entered version on stage 17. An electronics problem cost Belgian Ford driver Bruno Thiry 11 minutes and 20 places while he fixed it. The 1,452-km rally finishes on Monday. 2767 !GCAT !GSPO Teenager Yuuichi Takeda, racing in only his first season, outclassed the big names to win the first race in round nine of the world superbike championship on Sunday. Takeda, 18, showed poise far beyond his years to overtake Australian Ducati rider Troy Corser, last year's championship runner-up, with four of the 25 laps left. Honda's Takeda was pursued past Corser by the Yamaha duo of Noriyuki Haga and Wataru Yoshikawa with Haga briefly taking the lead in the final chicane on the last lap. But Takeda found one more spurt of power to just take the flag first with Haga second and Yoshikawa third. Haga recorded the fastest lap at 147.159 kph. Corser, who crashed during practice on Friday, limped in fourth, four seconds behind Takeda with championship leader Aaron Slight of New Zealand 11 seconds behind the winner. In the second race, Takeda again challenged strongly until the fifth lap from the end when he crashed while running second to eventual race winner Takuma Aoki. Aoki, the elder brother of reigning 125cc world champion Haruchika, had a race-long duel with John Kocinski of the United States on a Ducati before taking the chequered flag. Kocinski led for the early laps before he was passed first by Aoki, who recorded the fastest lap of 147.786 kph, and then by Takeda. With Takeda out of the race, Kocinski regained second place but he could not overtake Aoki. Haga crossed the line third but was later disqualified because of an illegal carburettor part on his Yamaha. Slight moved up into third place with defending world champion Carl Fogarty of Britain fourth on his Honda. The strong showing by the Japanese riders did not alter the positions in the championship table with Slight still leading on 283 points, followed by Corser with 270 and Kocinski with 254. 2768 !GCAT !GSPO Leading results from round nine of the superbike world championship on Sunday: First race 1. Yuuchi Takeda (Japan) Honda 38 minutes 30.054 seconds 2. Noriyuki Haga (Japan) Yamaha 38:30.140 3. Wataru Yoshikawa (Japan) Yamaha 38:32.353 4. Troy Corser (Australia) Ducati 38:34.436 5. John Kocinski (U.S.) Ducati 38:36.306 6. Aaron Slight (New Zealand) Honda 38:41.756 7. Norihiko Fujiwara (Japan) Yamaha 38:43.253 8. Carl Fogarty (Britain) Honda 38:49.595 9. Akira Ryo (Japan) Kawasaki 38:50.269 10. Shiya Takeishi (Japan) Kawasaki 38:52.271 Fastest lap: Haga 147.159 kph. Second race 1. Takuma Aoki (Japan) Honda 38:18.759 2. Kocinski 38:19.313 3. Haga 38:32.040 4. Slight 38:32.149 5. Fogarty 38:32.719 6. Fujiwara 38:33.595 7. Ryo 38:34.682 8. Takeishi 38:34.999 9. Yoshikawa 38:35.297 10. Corser 38:42.015 Fastest lap: Aoki 147.786 kph World championship standings (after nine rounds): 1. Slight 280 points 2. Corser 269 3. Kocinski 254 4. Fogarty 236 5. Colin Edwards (U.S.) Yamaha 176 6. Pier Francesco Chili (Italy) Ducati 175 7. Simon Crafar (New Zealand) Kawasaki 132 8. Anthony Gobert (Australia) Kawasaki 117 9. Yoshikawa 107 10. Neil Hodgson (Britain) Ducati 82 Revised placings for second race after the disqualification of Japanese rider Noriyuki Haga for using an illegal carburettor part: 1. Takuma Aoki (Japan) Honda 38:18.759 2. Kocinski 38:19.313 3. Slight 38:32.149 4. Fogarty 38:32.719 5. Fujiwara 38:33.595 6. Ryo 38:34.682 7. Takeishi 38:34.999 8. Yoshikawa 38:35.297 9. Corser 38:42.015 10. Keiichi Kitigawa (Japan) Suzuki 38:42.333 Fastest lap: Aoki 147.786 kph Revised world championship standings (after nine rounds): 1. Slight 283 points 2. Corser 270 3. Kocinski 254 4. Fogarty 238 5. Colin Edwards (U.S.) Yamaha 176 6. Pier Francesco Chili (Italy) Ducati 175 7. Simon Crafar (New Zealand) Kawasaki 133 8. Anthony Gobert (Australia) Kawasaki 117 9. Yoshikawa 108 10. Neil Hodgson (Britain) Ducati 82 2769 !GCAT !GSPO England all-rounder Chris Lewis has been dropped from the one-day squad to face Pakistan starting on Thursday after turning up late at The Oval on the fourth day of the final test on Sunday. Lewis was still not in the dressing-room 45 minutes before play began and, when he did arrive, chairman of selectors Ray Illingworth abruptly informed him he had been replaced in the squad by uncapped Kent fast bowler Dean Headley. The mercurial Lewis has endured an increasingly disappointing season after being recalled to the England set-up at the start of the season, only just managing to hold his place for The Oval test despite an unimpressive display at Headingley in the previous test. The 28-year-old Surrey player is not exactly a stranger to controversy but, ironically, has claimed to have rediscovered his motivation since moving back to London to live closer to his family after stints with Leicestershire and Nottinghamshire. The Lewis rumpus totally overshadowed the surprise inclusion of Graham Lloyd, son of national coach David, in a much-changed squad of 13. Four others in the team contesting the final test at the Oval have been either dropped or rested, with Lancashire batsman Lloyd, Surrey all-rounder Adam Hollioake and Headley all given initial chances to impress. Darren Gough, Matthew Maynard, Ronnie Irani and Peter Martin have been recalled to the international set-up, with tour certainties Dominic Cork, Nasser Hussain and John Crawley rested and Ian Salisbury and test 12th man Andy Caddick omitted. Squad: Michael Atherton (captain), Alec Stewart, Graham Thorpe, Nick Knight, Graham Lloyd, Matthew Maynard, Ronnie Irani, Adam Hollioake, Robert Croft, Darren Gough, Peter Martin, Dean Headley, Alan Mullally. 2770 !GCAT !GSPO Teenager Yuuichi Takeda, racing in only his first season, outclassed the big names to win the first race in round nine of the world superbike championship on Sunday. Takeda, 18, showed poise far beyond his years to overtake Australian Ducati rider Troy Corser, last year's championship runner-up, with four of the 25 laps left. Honda's Takeda was pursued past Corser by the Yamaha duo of Noriyuki Haga and Wataru Yoshikawa with Haga briefly taking the lead in the final chicane on the last lap. But Takeda found one more spurt of power to just take the flag first with Haga second and Yoshikawa third. Haga had the consolation of recording the fastest lap at 147.159 kph. Corser, who crashed during practice on Friday, limped in fourth, four seconds behind Takeda with championship leader Aaron Slight of New Zealand 11 seconds behind the winner. In the second race, Takeda again challenged strongly until the fifth lap from the end when he crashed while running second to eventual race winner Takuma Aoki. Aoki, the elder brother of reigning 125cc world champion Haruchika, had a race-long duel with John Kocinski of the United States on a Ducati before taking the chequered flag. Kocinski led for the early laps before he was passed first by Aoki, who recorded the fastest lap of 147.786 kph, and then by Takeda. With Takeda out of the race, Kocinski regained second place but he could not overtake Aoki. Haga again was the unlucky rider finishing third ahead of Slight with Corser in 10th place. But the strong showing by the Japanese riders did not alter the championship table with Slight still leading on 280 points, followed by Corser with 269 and Kocinski with 254. 2771 !GCAT !GSPO Phil Mickelson stretched his lead to three strokes entering the final round of the World Series of Golf tournament with a two-under-par 68 on Saturday. In second place at three under were two men who played-off for this title a year ago -- Greg Norman, the winner in sudden death in 1995, who shot a 69 on Saturday, and Billy Mayfair, in with a par 70. Only two other golfers were under par after three rounds. Masters winner Nick Faldo was at one under after a 68, along with Steve Stricker, who shot 69. Half an hour after Mickelson teed off in the third round there was a small, but loud, explosion near Firestone's first tee. The homemade firework, which local police estimated to have the power of a single stick of dynamite, slightly injured three people in the deserted area around the teebox. The 43 golfers on the course were unaware of what happened, though all heard the explosion. Tournament officials announced after the round that security would be heightened for Sunday's final round and that spectators' bags may be searched. "I heard it, but never thought twice about it," Mickelson said. "I can't believe the stupidity of some people. We're lucky people weren't seriously hurt." About his game and prospects for his fourth victory of the year, Mickelson said: "I'm looking forward to tomorrow. I'm playing well and my confidence is building in my putting. Because Firestone is a course where it's tough to shoot a real low score, I won't have to tear it up tomorrow to win." Mickelson had a steady round. His only bogey was a three putt on the 12th hole. He made three birdies, all with putts ranging from 15 to 30 feet. Norman, the defender, finished with a bogey, his third of the day. He also had four birdies and said that he looked forward to pursuing Mickelson. "He's obviously playing well, but three strokes is not a very big lead. This is a course were you can lose three or four easily." Norman willbe paired with Nick Faldo on Sunday, the first time the two have played together since the final round of the Masters, when Norman shot a 76 and lost a six stroke lead. 2772 !GCAT !GSPO Results of European Super League rugby league matches on Sunday: Halifax 64 Leeds 24 London 56 Castleford 0 Standings: Wigan 22 19 1 2 902 326 39 St Helens 21 19 0 2 884 441 38 Bradford 22 17 0 5 767 409 34 London 22 12 1 9 611 462 25 Warrington 21 12 0 9 555 499 24 Halifax 22 10 1 11 667 576 21 Sheffield 22 10 0 12 599 730 20 Oldham 22 9 1 12 473 681 19 Castleford 22 9 0 13 548 599 18 Leeds 22 6 0 16 555 745 12 Paris 22 3 1 18 398 795 7 Workington 22 2 1 19 325 1021 5 2773 !GCAT !GSPO South African fast bowler Shaun Pollock concluded his Warwickshire career with a flourish on Sunday by taking the final three wickets during the county's Sunday league victory over Worcestershire. Pollock, who returns home on Tuesday for an ankle operation, took the last three wickets in nine balls as Worcestershire were dismissed for 154. After an hour's interruption for rain, Warwickshire then reached an adjusted target of 109 with 13 balls to spare and record their fifth win in the last six games. Warwickshire are currently in fourth position behind Yorkshire, Nottinghamshire and Surrey. Yorkshire captain David Byas completed his third Sunday league century as his side swept clear at the top of the table, reaching a career best 111 not out against Lancashire. Lancashire's total of 205 for eight from 40 overs looked reasonable before Byas put their attack to the sword, collecting his runs from just 100 balls with three sixes and nine fours. Yorkshire eventually reached their target with only four wickets down and 7.5 overs to spare. 2774 !GCAT !GSPO Former captain Salim Malik effectively guaranteed Pakistan a series win over England when he hit a fine 100 not out on the fourth day of the third test at the Oval on Sunday. It was his 14th test century and his first since being sacked from the captaincy amid allegations of bribes and match-rigging in March last year. Malik's innings allowed the Pakistanis to declare on 521 for eight in their first innings, a lead of 195 and ensured that England would spend the last day fighting for a face-saving draw rather than pushing for the win which would level the series 1-1. Some brave batting from Michael Atherton, 26 not out, and Alec Stewart, 40 not out, carried England to 74 without loss at the close, still 121 runs behind. England's state of mind was scarcely helped by all-rounder Chris Lewis, who arrived at the ground late and was promptly dropped from the one-day squad to face Pakistan this week. The dressing-room mood would have been still worse had Atherton and Stewart not survived 23 awkward overs in the evening, denying Pakistan captain Wasim Akram the chance to secure the three wickets he needs to be only the 11th bowler to reach 300 in test cricket. Atherton did well to survive a hostile first over but he and Stewart then showed impressive temperament against the fiery Pakistan left-armer. On another rain-affected day, Malik, playing in his 90th test, ignored the interruptions and added 98 runs to his overnight two not out as Pakistan progressed serenely to their first innings lead of 195. His 14th test century, which came in 287 minutes from 223 balls and included 10 fours, was also a record fourth for a Pakistan batsman against England. Only Javed Miandad, with 23, has scored more centuries overall. With the scoreboard reading 334 for three when he strode to the crease on Saturday afternoon, his third hundred on successive tours of England could scarcely be rated as his most pressured but given all the problems of the past 18 months, it marked a triumphant return to form for Malik. It also demonstrated that Pakistan's batting line-up has few equals. Five different players have scored hundreds during the three-test series and England have dismissed them only twice, for 340 and 448, in five attempts during the summer. It helps explain why the touring team are now within touching distance of their fourth successive series victory over their opponents. It is 14 years since England last ended on top in a series. Akram chipped in with 40 before he was stumped off Robert Croft, the most accurate of England's bowlers who returned two for 116 in 47 overs on his test debut. Alan Mullally picked up the late wicket of Mushtaq Ahmed to finish with three for 97, while Lewis was left to reflect on figures of none for 112 at the end of a disastrous day. The one bright spot for the Surrey all-rounder was his brilliant run out of Asif Mujtaba but this contribution was overshadowed by the news he had been dropped from the England one-day team for arriving at the ground almost an hour late on Sunday. Lewis's explanation that his car had suffered a puncture was not enough to save him from disciplinary action and the incident looks set to cost him far more than his local garage may charge for a new tyre. England manager Ray Illingworth, for whom the selection of the squad to tour Zimbabwe and New Zealand represents a final chapter in 50 years connected with the game, was asked if the incident would affect Lewis's prospects. "It won't do them any good," he responded grimly. The player himself declined to comment publicly. 2775 !GCAT !GSPO Results in the latest round of Sunday League (40 overs a side) cricket matches: At Edgbaston: Warwickshire beat Worcestershire on faster run ran in rain-affected match. Worcestershire 154 in 36.3 overs (A.Giles 5-36). Warwickshire 109-3 in 23.5 overs (N.Smith 62 not out). Warwickshire 4 points. At Colchester: Gloucestershire beat Essex by 4 wickets. Essex 176-9 in 40 overs. Gloucestershire 178-6 in 33.3 overs (A.Symonds 70). Gloucestershire 4 points. At Cardiff: Glamorgan beat Kent by 8 wickets. Kent 147 in 39.3 overs. Glamorgan 149-2 in 31.5 overs (A.Dale 65 not out, S.James 50). Glamorgan 4 points. At Leicester: Match abandoned - rain. Hampshire 199-5 in 40 overs (P.Whitaker 54). Leicestershire 38-3 in 9.2 overs. Leicestershire and Hampshire 2 points. At Headingley: Yorkshire beat Lancashire by 6 wickets. Lancashire 205-8 in 40 overs. Yorkshire 206-4 in 32.1 overs (D.Byas 111 not out). Yorkshire 4 points. At Weston-super-Mare: Somerset beat Durham by 7 wickets. Durham 183-5 in 40 overs (M.Roseberry 63). Somerset 187-3 in 37.1 overs (S.Eccleston 75, P.Bowler 62). Somerset 4 points. At Northampton: Northamptonshire beat Sussex on faster scoring rate in rain-affected match. Sussex 229-8 innings closed (M.Newell 69). Northamptonshire 127-5 in 19.5 overs. Northamptonshire 4 points. Standings (tabulated under played, won, lost, tied, no result, points): Yorkshire 15 10 5 0 0 40 Nottinghamshire 14 9 4 0 1 38 Surrey 14 9 4 0 1 38 Warwickshire 14 9 4 0 1 38 Northamptonshire 14 9 4 0 1 38 Worcestershire 14 7 4 0 3 34 Somerset 14 8 5 0 1 34 Middlesex 14 7 6 0 1 30 Kent 15 7 7 1 0 30 Leicestershire 14 6 5 0 3 30 Derbyshire 14 5 6 1 2 26 Sussex 14 5 7 0 2 24 Lancashire 14 6 8 0 0 24 Glamorgan 14 5 7 0 2 24 Gloucestershire 15 4 8 0 3 22 Hampshire 14 4 7 0 3 22 Essex 14 3 10 0 1 14 Durham 15 1 13 0 1 6 2776 !GCAT !GSPO England manager Glenn Hoddle called up uncapped Everton defender Andy Hinchcliffe on Sunday to the national squad for the opening World Cup qualifier against Moldova next weekend. Left-back Hinchcliffe, 27, replaces Tottenham's Darren Anderton who has a recurring groin problem. 2777 !GCAT !GSPO England were 74 for no wicket in their second innings at the close of the fourth day of the third and final test at The Oval on Sunday. Scores: England 326 and 74-0; Pakistan 521-8 declared. 2778 !GCAT !GSPO Summary of an English premier league soccer match on Sunday: Manchester United 2 (Cruyff 39th minute, Solskjaer 70th) Blackburn 2 (Warhurst 34th, Bohinen 51st). Halftime 1-1. Attendance 54,178. 2779 !GCAT !GSPO Results of English league soccer matches on Sunday: Premier league Manchester United 2 Blackburn 2 Standings ((tabulated under played, won, drawn, lost, goals for, against, points): Sheffield Wednesday 3 3 0 0 6 2 9 Chelsea 3 2 1 0 3 0 7 Arsenal 3 2 0 1 4 2 6 Aston Villa 3 2 0 1 4 2 6 Manchester United 3 1 2 0 7 4 5 Sunderland 3 1 2 0 4 1 5 Liverpool 3 1 2 0 5 3 5 Everton 3 1 2 0 4 2 5 Tottenham 3 1 2 0 3 1 5 Nottingham Forest 3 1 1 1 5 5 4 West Ham 3 1 1 1 3 4 4 Leicester 3 1 1 1 2 3 4 Newcastle 3 1 0 2 3 4 3 Middlesbrough 3 0 2 1 4 5 2 Derby 3 0 2 1 4 6 2 Leeds 2 0 1 1 3 5 1 Southampton 3 0 1 2 2 4 1 Blackburn 3 0 1 2 2 5 1 Coventry 3 0 1 2 1 6 1 Wimbledon 2 0 0 2 0 5 0 Division one Barnsley 3 Huddersfield 1 Standings: Bolton 3 2 1 0 5 2 7 Barnsley 2 2 0 0 5 2 6 Wolverhampton 2 2 0 0 4 1 6 Queens Park Rangers 2 2 0 0 4 2 6 Stoke 2 2 0 0 4 2 6 Birmingham 2 1 1 0 5 4 4 Tranmere 2 1 1 0 4 3 4 Oxford 2 1 0 1 6 2 3 Ipswich 2 1 0 1 5 3 3 Bradford 2 1 0 1 3 2 3 Crystal Palace 2 1 0 1 3 2 3 Huddersfield 2 1 0 1 3 3 3 Norwich 2 1 0 1 3 3 3 Reading 2 1 0 1 3 5 3 Manchester City 3 1 0 2 2 3 3 Port Vale 2 0 2 0 2 2 2 Sheffield United 2 0 1 1 4 5 1 West Bromwich 2 0 1 1 2 3 1 Charlton 2 0 1 1 1 3 1 Swindon 2 0 1 1 1 3 1 Southend 2 0 1 1 1 6 1 Grimsby 2 0 0 2 3 6 0 Oldham 2 0 0 2 2 5 0 Portsmouth 2 0 0 2 2 5 0 2780 !GCAT !GSPO Scoreboard on the fourth day of the third and final test between England and Pakistan at The Oval on Sunday: England first innings 326 (J.Crawley 106, G.Thorpe 54; Waqar Younis 4-95) Pakistan first innings (overnight 339-4) Saeed Anwar c Croft b Cork 176 Aamir Sohail c Cork b Croft 46 Ijaz Ahmed c Stewart b Mullally 61 Inzamam-ul-Haq c Hussain b Mullally 35 Salim Malik not out 100 Asif Mujtaba run out 13 Wasim Akram st Stewart b Croft 40 Moin Khan b Salisbury 23 Mushtaq Ahmed c Crawley b Mullally 2 Waqar Younis not out 0 Extras (b-4 lb-5 nb-16) 25 Total (for eight wickets, declared) 521 Fall of wickets: 1-106 2-239 3-334 4-334 5-365 6-440 7-502 8-519 Did not bat: Mohammad Akam Bowling: Lewis 23-3-112-0, Mullally 37.1-7-97-3, Croft 47-10-116-2, Cork 23-5-71-1, Salisbury 29-3-116-1 England second innings M.Atherton not out 26 A.Stewart not out 40 Extras (nb-8) 8 Total (for no wicket) 74 Bowling (to date): Wasim Akram 7-0-35-0, Waqar Younis 7-1-24-0, Mushtaq Ahmed 7-2-11-0, Aamir Sohail 2-1-4-0 2781 !GCAT !GSPO Pakistan declared their first innings at 521-8 on the fourth day of the third and final test against England at The Oval on Sunday. Scores: England 326; Pakistan 521-8. 2782 !GCAT !GSPO Result of a Scottish premier division soccer match on Sunday: Aberdeen 4 Hearts 0 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Rangers 3 3 0 0 7 2 9 Celtic 3 2 1 0 9 4 7 Aberdeen 3 1 2 0 8 4 5 Motherwell 3 1 2 0 6 3 5 Hibernian 3 1 1 1 2 2 4 Hearts 2 1 0 1 3 6 3 Kilmarnock 3 1 0 2 5 7 3 Dundee United 3 0 1 2 1 3 1 Dunfermline 2 0 1 1 2 5 1 Raith 3 0 0 3 1 8 0 2783 !GCAT !GSPO Pakistan stretched their lead over England to 147 runs on Sunday as England did their best to mount a damage limitation exercise on the fourth day of the final test at the Oval. As officials spent their time explaining Chris Lewis's omission from the squad for the forthcoming one-day internationals, the home side stuck grimly to their task in conditions still heavily weighted in favour of the bat. By tea, following an afternoon session cut short by rain, the touring side had reached 473 for six, with former captain Salim Malik unbeaten on 63. The only two wickets to fall after Pakistan resumed at their overnight 339 for four were Asif Mujtaba and skipper Wasim Akram, the former for 13 to a superb piece of fielding by the out-of-favour Lewis. The Surrey all-rounder, dropped as a disciplinary measure after arriving late on the fourth morning sayin his car had suffered a puncture, swooped on the ball at third man and returned off-balance to county team mate Alec Stewart who whipped off the bails before the batsman could complete a second run. Lewis, though, could not make a similar impact with the ball conceding over 100 runs without taking a wicket. Wasim also seemed set for a half-century before he was stumped for 40 off Robert Croft with the score on 440, having shared a stand of 72 for the sixth wicket with Salim. 2784 !GCAT !GSPO Pakistan were 473-6 at tea on the fourth day of the third and final test at The Oval on Sunday in reply to England's 326. Scores: England 326; Pakistan 473-6. 2785 !GCAT !GSPO Chris Lewis did his best to forget his controversial omission from the England one-day squad on Sunday but could not prevent Pakistan reasserting their dominance in the final test at The Oval. A super piece of fielding by Lewis, dropped as a disciplinary measure after arriving only 35 minutes before the start on the fourth morning, provided the only bright spot for England as the touring team batted on to reach 413 for five at the interval, a lead of 87. The solitary wicket to fall was Asif Mujtaba, run out for 13 attempting a second run to third man where Lewis was lurking with a point to prove. There seemed scant danger until the Surrey player swooped on to the ball and returned off balance to county team mate Alec Stewart who whipped off the bails. Lewis, though, could not make similar waves with the ball as Salim Malik and Wasim Akram batted through the rest of the session with few alarms. Wasim rattled along to 30 not out, outscoring his partner who was unbeaten on 24 at the break, although the weather was again threatening to play the dominant role. Rain arrived just as the players left the field for lunch, forcing the ground-staff into action yet again. The weather delayed the resumption for over an hour, the umpires finally announcing play would start again at 1445 local time (1345 GMT). 2786 !GCAT !GSPO The England cricket squad was announced on Sunday for the one-day international series against Pakistan starting on Thursday. Squad: Michael Atherton (captain), Alec Stewart, Graham Thorpe, Nick Knight, Graham Lloyd, Matthew Maynard, Ronnie Irani, Adam Hollioake, Robert Croft, Darren Gough, Peter Martin, Dean Headley, Alan Mullally. 2787 !GCAT !GSPO Third-seeded Wayne Ferreira of South Africa won the 13th tournament of his career on Sunday, defeating unseeded Australian Todd Woodbridge 6-2 6-4 at the Canadian Open. Ferreira, who will move from 10th to 7th in the world rankings after the victory, took home a first-prize check worth $288,000. The 24-year-old South African has won his last six meetings with the 43rd-ranked Woodbridge and Sunday he had more power and more consistency than the 26-year-old Australian. On a bright sunny afternoon, both players had to battle windy conditions. "The wind really swirls around and it's difficult to get your game to the level you'd like," said Ferreira. "Normally, I'm pretty bad in the wind and I struggle a lot. But I decided to take a little off my first serve and use my backhand slice to keep the ball low and it worked." He faced only one break point, in the second game of the match, and saved it on a Woodbridge error. "This is the biggest tournament I've ever won," said Ferreira about the ATP Tour Super Nine event. Woodbridge was broken in the opening game of the match and was so upset that he hit a ball into the front of the courtside box seats and received a warning for ball abuse from the umpire. "I was frustrated because I missed a couple of shots by just a little bit," said Woodbridge, who admitted feeling "tight" at the outset. "It was a big game in a match when you're gunning for a guy who's ranked higher than you." Woodbridge lost his serve at 2-2 in the second set and Ferreira took control, winning the title on his first match point when Woodbridge hit a forehand wide. "I think what Wayne has improved is his court mobility and his speed," Woodbridge said. "Playing him is a little like playing (American) Michael Chang because you feel it's necessary to hit the ball better and harder. He can run down awkward shots and that's an area of his game that has gotten better." "I have a trainer that travels with me," said Ferreira, who goes for a 20-minute run right after his matches to loosen up. "He keeps me working hard and that really pays off on court." At the U.S. Open, which begins Monday, both Ferreira, the ninth seed, and Woodbridge will play qualifiers. Ferreira feels very confident going into Flushing Meadows. "If I'm going to lose at the (U.S.) Open, it'll have to be to someone playing exceptionally well," he said. 2788 !GCAT !GSPO Results from the Canadian Open tennis tournament on Sunday (prefix number denotes seeding): Final 3-Wayne Ferreira (South Africa) beat Todd Woodbridge (Australia) 6-2 6-4 2789 !GCAT !GSPO Third-seeded Wayne Ferreira of South Africa outduelled seventh-seeded Todd Martin of the United States 4-6 6-3 7-5 in the semifinals of the $2 million Canadian Open on Saturday. Ferreira will meet unseeded Todd Woodbridge of Australia in Sunday's final. The 43rd-ranked Aussie easily handled an uninspired Marcelo Rios of Chile, the fourth seed, 6-0 6-3 in Saturday's other semifinal. Ferreira, ranked 10th in the world, served for the match at 5-4 in the third set only to have the 13th-ranked Martin save a match point and then win the game when Ferreira hit a forehand long. But the 24-year-old South African immediately broke back and served out the final game at a loss of only one point. "I thought I played very solid on my serve and I made him play a lot of balls on his, especially when he missed his first serve," Ferreira said. Martin's aggressive hitting and net play dominated the early part of the match, but Ferreira's passing shots, particularly his forehand, picked up and clearly became intimidating for Martin. The tall American actually retreated to the baseline several times after hitting approach shots in the third set. "The reason I lost is that I probably hit a few too many times to his forehand in stead of his backhand," Martin said. "It's difficult when three quarters of the c ourt is open not to hit there, and then to still lose the point. "When I served for the match at 5-5 (in the third set) I didn't get enough first serves in." Rios, ranked 11th, didn't give Woodbridge much of a match. The Aussie won the first set in just 24 minutes and the second in 29. Rios did break Woodbridge's serve in the fifth game of the second set to take a 3 -2 lead. But when Woodbridge broke back in the next game, the Chilean seemed to lose heart. His listless effort was apparent and soon he was being jeered by the crowd which had been cheering for the flamboyant player earlier in match. "Some days you are losing and you don't feel like playing," Rios said. "When you feel bad on the court, the only thing you want to do is get off the court." Woodbridge was solid but not overpowering. His slice backhand shots seemed to unn erve the moody 20-year-old Rios. "I have beaten him before reasonably comfortabl, and it is pretty obvious he didn't like the ball down low," Woodbridge, 26, said. "Today, he didn't know what to do with it and that frustrated him to the point where he gave up." 2790 !GCAT !GSPO Results from the Canadian Open tennis tournament on Saturday (prefix numbers denotes seedings): Semifinals 3-Wayne Ferreira (South Africa) beat 7-Todd Martin (U.S.) 4-6 6-3 7-5 Todd Woodbridge (Australia) beat 4-Marcelo Rios (Chile) 6-0 6-3 2791 !GCAT !GSPO Togo beat Congo 1-0 (halftime 0-0) in their African Nations Cup preliminary round, second leg qualifying match on Sunday. Scorer: Salou Bachirou (53rd minute) Attendance: 18,000 Togo win 1-0 on aggregate. 2792 !GCAT !GSPO South African rugby manager Morne du Plessis has complained to the New Zealand management over the on-field behaviour of All Blacks' captain Sean Fitzpatrick during Saturday's second test in Pretoria. However, he said that the Springboks would not be citing Fitzpatrick over an incident where he was penalised for stiff-arming opposing captain Gary Teichmann while making a tackle. Du Plessis said that he had telephoned All Black coach John Hart to pass on his and the Springboks' "extreme displeasure" with the incident and had asked Hart to pass on the message to Fitzpatrick. "To cite Fitzpatrick at this stage would appear to be sour grapes as well as supporting a citing system with which we are not happy," said du Plessis. "In the past if a similar incident had taken place I have no doubt that members of our team would have been cited," he said. Two years ago, Springbok prop Johan le Roux was banned for 19 months after being cited for biting Fitzpatrick during a test match in Wellington. The South Africans believe an independent match commissioner should have responsibility for disciplinary matters. Currently each side can cite the other team's players for acts of violent conduct. New Zealand won Saturday's test 33-26 to take the three-test series 2-0. 2793 !GCAT !GSPO Ethiopia and Uganda drew 1-1 (halftime 1-0) in their African Nations Cup preliminary round, second leg match on Sunday. Attendance: 25,000 Aggregate 2-2. Ethiopia won 4-2 penalties. 2794 !GCAT !GSPO Results of Yugoslav league soccer matches played on Sunday: Division A Vojvodina 1 Partizan 1 Crvena zvezda 3 Proleter 1 Division B Zelesnik 0 Rudar 1 2795 !GCAT !GSPO Leading goalscorers in the Polish first division after the weekend's matches: 7 - Bogdan Prusek (Sokol Tychy) 5 - Slawomir Wojciechowski (GKS Katowice) 4 - Jacek Dembinski (Widzew Lodz), Marcin Mieciel (Legia Warsaw), Ryszard Wieczorek (Odra Wodzislaw) 3 - Jacek Berensztain (GKS Belchatow), Marek Citko (Widzew), Adam Fedoruk, Dariusz Jackiewicz (both Amica Wronki), Bartlomiej Jamroz (Hutnik Krakow), Tomasz Moskal (Slask Wroclaw), Krzysztof Piskula (Lech Poznan), Mariusz Srutwa (Ruch Chorzow), Emmanuel Tetteh (Polonia Warszawa), Krzysztof Zagorski (Odra) 2796 !GCAT !GSPO Results of first division soccer matches played over the weekend: A.S. Bacau 1 Ceahlaul Piatra Neamt 1 Otelul Galati 1 F.C. Arges Dacia Pitesti 0 F.C. Farul Constanta 3 Chindia Tirgoviste 1 Sportul Studentesc 4 Universitatea Craiova 2 F.C. Petrolul Ploiesti 4 Politehnica Timisoara 5 F.C. Brasov 1 F.C. National Bucharest 1 Jiul Petrosani 1 Dinamo Bucharest 0 Gloria Bistrita 0 Universitatea Cluj 1 Rapid Bucharest 0 Steaua Bucharest 2 Standings (tabulate under played, won, drawn, lost, goals for, against, points): Dinamo Bucharest 4 3 0 1 6 2 9 Jiul Petrosani 4 3 0 1 6 4 9 F.C. Farul Constanta 4 2 2 0 6 2 8 Universitatea Cluj 4 2 2 0 6 4 8 A.S. Bacau 4 2 1 1 7 3 7 Politehnica Timisoara 4 2 1 1 11 9 7 F.C. National Bucharest 4 2 1 1 7 6 7 Otelul Galati 4 2 0 2 4 3 6 F.C. Chindia Tirgoviste 4 2 0 2 3 4 6 Steaua Bucharest 4 2 0 2 5 7 6 F.C. Arges Dacia Pitesti 4 1 2 1 4 2 5 Universitatea Craiova 4 1 1 2 8 6 4 Sportul Studentesc 4 1 1 2 7 9 4 Ceahlaul Piatra Neamt 4 1 1 2 2 4 4 F.C. Brasov 4 1 1 2 6 10 4 Gloria Bistrita 4 1 0 3 3 9 3 F.C. Petrolul Ploiesti 4 0 2 2 5 7 2 Rapid Bucharest 4 0 1 3 4 9 1 2797 !GCAT !GSPO French Open champion Yevgeny Kafelnikov of Russia will miss the U.S. Open after pulling a muscle in his back while playing golf, his trainer said on Sunday. Anatoly Lepeshin told Itar-Tass news agency the world number four had returned to Moscow on his doctor's advice after a final training session in New York on Saturday. The championships begin on Monday. 2798 !GCAT !GSPO Results of Polish first division soccer matches played over the weekend: Amica Wronki 3 Hutnik Krakow 0 Sokol Tychy 5 Lech Poznan 3 Rakow Czestochowa 1 Stomil Olsztyn 4 Wisla Krakow 1 Gornik Zabrze 0 Slask Wroclaw 3 Odra Wodzislaw 1 GKS Katowice 1 Polonia Warsaw 0 Zaglebie Lubin 2 LKS Lodz 1 Legia Warsaw 3 GKS Belchatow 2 Widzew Lodz 3 Ruch Chorzow 0 Standings (tabulate under played, won, drawn, lost, goals for, against, points): Amica Wronki 7 5 1 1 13 8 16 Legia Warsaw 7 5 1 1 13 7 16 Lech Poznan 7 5 0 2 12 9 15 Widzew Lodz 7 4 2 1 13 3 14 GKS Katowice 7 4 2 1 12 9 14 Sokol Tychy 7 4 0 3 14 15 12 Odra Wodzislaw 7 3 1 3 13 10 10 Slask Wroclaw 7 3 1 3 8 7 10 Polonia Warsaw 7 3 1 3 7 9 10 GKS Belchatow 7 3 0 4 9 9 9 Stomil Olsztyn 7 2 3 2 9 9 9 Wisla Krakow 7 2 3 2 3 4 9 Hutnik Krakow 7 3 0 4 8 10 9 Rakow Czestochowa 7 2 1 4 6 10 7 Zaglebie Lubin 7 1 3 3 10 12 6 Ruch Chorzow 7 1 2 4 7 13 5 Gornik Zabrze 7 1 1 5 6 10 4 LKS Lodz 7 0 2 5 4 13 2 2799 !GCAT !GSPO Russian swimmer Alexander Popov, a double-gold medallist at the Atlanta Olympics, was in a serious condition in hospital on Sunday after being stabbed on a Moscow street, Itar-Tass news agency said. It quoted police as saying the 24-year-old, who has been the dominant force in sprint freestyle for the past five years, was stabbed in south-west Moscow around 11 p.m. (1900 GMT) on Saturday after an argument with a roadside watermelon seller. The head of the Russian swimming federation, Gennady Aleshin, told Tass Popov's lungs and kidneys were affected. Medical staff at the hospital said Popov underwent surgery overnight. Popov, who trains in Australia, retained his 50 and 100 metres Olympic freestyle titles in Atlanta last month, the first time a swimmer had successfully defended at two Olympic distances. He was the first swimmer since "Tarzan" star Johnny Weissmuller in 1928 to successfully defend the blue riband Olympic swimming event, the 100 metres. 2800 !GCAT !GSPO Results of Russian premier league matches played on Saturday: Alaniya Vladikavkaz 3 Zhemchuzhina Sochi 1 Baltika Kaliningrad 2 Zenit St Petersburg 0 Chernomorets Novorossiisk 2 Rostselmash Rostov 1 Lokomotiv Moscow 2 Torpedo Moscow 1 Rotor Volgograd 0 Dynamo Moscow 1 CSKA Moscow 4 Kamaz Naberezhnye Chelny 2 Lada Togliatti 1 Spartak Moscow 1 Tekstilshik Kamyshin 2 Krylya Sovetov Samara 1 Lokomotiv Nizhny Novgorod 2 Uralmash Yekaterinburg 2 Standings (tabulate under games played, won, drawn, lost, goals for, goals against, points). Note - if more than one team has the same number of points, precedence is given to the one with most wins. If more than one team has the same number of wins and points, precedence goes to the side with the most successful record against the others). Alaniya Vladikavkaz 24 16 5 3 48 25 53 Dynamo Moscow 25 15 7 3 43 21 52 Rotor Volgograd 23 15 5 3 42 17 50 Spartak Moscow 25 14 7 4 48 24 49 CSKA Moscow 25 13 6 6 40 27 45 Lokomotiv Nizhny Novgorod 25 11 4 10 27 35 37 Lokomotiv Moscow 25 9 9 7 30 24 36 Baltika Kaliningrad 25 8 10 7 29 26 34 Torpedo Moscow 25 8 9 8 31 33 33 Zenit St Petersburg 24 9 4 11 24 26 31 Krylya Sovetov Samara 25 8 7 10 19 29 31 Zhemchuzhina Sochi 25 8 4 13 26 38 28 Rostselmash Rostov 24 7 7 10 42 38 28 Chernomorets Novorossiisk 25 7 5 13 25 38 26 Kamaz Naberezhnye Chelny 24 5 4 15 25 42 19 Lada Togliatti 24 4 6 14 15 37 18 Tekstilshchik Kamyshin 25 3 9 13 15 30 18 Uralmash Yekaterinburg 24 3 8 13 24 43 16 2801 !GCAT !GSPO Two male players died and a teenage girl received spinal injuries in separate accidents in rugby league matches in suburban Sydney on Sunday, authorities said. Australian Rugby League (ARL) spokesman John Brady told reporters a 16-year-old was had died after being injured in a tackle while playing in a match in the inner Sydney suburb of Birchgrove. The teenager, whose name was not released, appeared to have suffered a fit shortly after being tackled and was treated by paramedics at the scene. He was taken to Royal Prince Alfred Hospital, where an ambulance spokesman said he died shortly after arrival. The second fatality came during a match at Harbord on Sydney's northern beaches. A 26-year-old man who was playing in his second match of the afternoon collapsed shortly after making a tackle. An ambulance spokesman said the man had apparently suffered a cardiac arrest and was treated at the ground but later died in hospital. His name was also not released. "Obviously anybody in the game regrets these deaths but this sort of thing is extremely rare," Brady said. "Until doctors complete their investigations, we cannot be sure they're even related to the game. All we can say is that it is a tragedy for two families," he said. An ambulance spokesman told reporters a 17-year girl suffered a spinal injury while playing in a women's rugby league match in Bankstown in Sydney's west. The teenager had apparently suffered bruising to the lower spinal column but appeared to have escaped serious injury, the spokesman said. 2802 !GCAT !GSPO Fullback Matthew Ridge equalled a club point-scoring record on Sunday as Australian Rugby League (ARL) premiership leaders Manly bounced back from their worst defeat of the year to thrash Western Suburbs 42-12. Manly, beaten by lowly Penrith a week ago, scored five tries against Western Suburbs to maintain their two-point lead at the head of the ARL standings with just one round of matches remaining before next month's play-offs. Brisbane maintained second place with a 38-10 win over Gold Coast while North Sydney trounced South Sydney to jump one place into third. Sydney City and Cronulla are fourth and fifth respectively and are due to play on Monday night. The top eight sides in the 20-team ARL premiership qualify for the play-offs. Canberra continued their steady improvement to take sixth place with a 30-6 victory against Auckland on Friday, ending the New Zealand side's hopes of progressing any further. St George were beaten 24-20 by fourth-last North Queensland on Sunday and dropped back to seventh place. Newcastle round out the top eight after coming from behind to beat Western Reds 24-20 on Saturday. Ridge went on a point-scoring spree for Manly, netting two tries and 11 goals in a personal haul of 30 points to equal a club scoring record for one match set by Ron Knowles in 1954. New Zealand international Ridge is leaving the club at the end of the season to play with Auckland next year, leaving coach Bob Fulton to lament the loss of one of his key players. "Ridge's record just speaks for itself," Fulton said. "He's got every ingredient it takes to make a champion and since I've been here the past four years I've never seen him play a bad game." Western Suburbs, who scored a last-minute, one-point win over North Sydney last Monday, were outclassed by Manly and are in ninth place with only a slim chance of making the play-offs. 2803 !GCAT !GSPO Results of Australian rugby league matches played at the weekend. Played Sunday: Sydney Bulldogs 17 South Queensland 16 Brisbane 38 Gold Coast 10 North Sydney 46 South Sydney 4 Illawarra 42 Penrith 2 St George 20 North Queensland 24 Manly 42 Western Suburbs 12 Played Saturday: Parramatta 14 Sydney Tigers 26 Newcastle 24 Western Reds 20 Played Friday: Canberra 30 Auckland 6 Premiership standings (tabulate under played, won, drawn, lost, points for, against, total points): Manly 21 17 0 4 501 181 34 Brisbane 21 16 0 5 569 257 32 North Sydney 21 14 2 5 560 317 30 Sydney City 20 14 1 5 487 293 29 Cronulla 20 12 2 6 359 258 26 Canberra 21 12 1 8 502 374 25 St George 21 12 1 8 421 344 25 Newcastle 21 11 1 9 416 366 23 Western Suburbs 21 11 1 9 382 426 23 Auckland 21 11 0 10 406 389 22 Sydney Tigers 21 11 0 10 309 435 22 Parramatta 21 10 1 10 388 391 21 Sydney Bulldogs 21 10 0 11 325 356 20 Illawarra 21 8 0 13 395 432 16 Western Reds 21 6 1 14 297 398 13 Penrith 21 6 1 14 339 448 13 North Queensland 21 6 0 15 266 593 12 Gold Coast 21 5 1 15 351 483 11 South Sydney 21 5 1 15 304 586 11 South Queensland 21 4 0 17 210 460 8 2804 !GCAT !GSPO Malaysia's Ong Ewe Hock overcame an erratic start on Sunday to clinch his first Grand Prix title in the men's singles at the Malaysian Open badminton championships. The 24-year-old Malaysian, seeded second in the $185,000 tournament after a spate of late withdrawals, was given an early fright by Indonesia's Indra Wijaya who streaked to a 15-1 win in the first game. But Ong, backed by a vociferous hometown crowd, turned the tables to win the next set 15-1 and cruised to a 15-7 victory in the final game for his first singles title since turning professional two years ago. "Although I was confident of winning, it did not come easily," Ong said. "Wijaya played a well-calculated game but he could not sustain the pace." The unseeded Wijaya said he was happy just to get to the finals and admitted he suffered from nerves. "I was under tremendous pressure, but Ong deserves the credit. He controlled the match in the second and third games. But I am happy with my play here," said Wijaya who will compete in the Indonesian open next week. In the women's final, second seed Zhang Ning of China defeated top seeded compatriot Wang Chen 11-7 11-8. The women's doubles final saw the most entertaining badminton of the night with Danish pair Marlene Thomsen and Lisbet Stuer-Lauridsen edging China's Qiang Hong and Liu Lu 10-15 17-14 17-16 in a 70-minute thriller. It was the Danish pair's first title on the Asian circuit since they became partners two years ago. "This win is fantastic," Stuer-Lauridsen said. "We were trailing all the time but finally managed to pull through. I guess our experience mattered most today." 2805 !GCAT !GSPO Results of finals in the Malaysian Open badminton tournament on Sunday (prefix numbers denote seedings): Men's singles 2-Ong Ewe Hock (Malaysia) beat Indra Wijaya (Indonesia) 1-15 15-1 15-7 Women's singles 2-Zhang Ning (China) beat 1-Wang Chen (China) 11-7 11-8 Women's doubles 3/4-Marlene Thomsen/Lisbet Stuer-Lauridsen (Denmark) beat 3/4-Qiang Hong/Liu Lu (China) 10-15 17-14 17-16 Men's doubles 1-Yap Kim Hock/Cheah Soon Kit (Malaysia) beat Lee Wan Wah/Chong Tan Fook (Malaysia) 15-5 15-3 2806 !GCAT !GSPO Results of South Korean pro-baseball games played on Saturday. Haitai 10 Hanwha 4 Hyundai 5 Samsung 4 Ssangbangwool 4 LG 1 OB 1 Lotte 1 Lotte 1 OB 0* *Note - OB and Lotte played two games. Standings after games played on Saturday (won, drawn, lost, winning percentage, games behind first place) W D L PCT GB Haitai 63 2 40 .610 - Ssangbangwool 57 2 47 .547 6 1/2 Hyundai 55 5 47 .537 7 1/2 Hanwha 55 1 48 .534 8 Samsung 47 5 54 .467 15 Lotte 44 6 52 .461 15 1/2 LG 44 5 57 .439 18 OB 40 6 60 .406 21 1/2 2807 !GCAT !GSPO Israeli coach Shlomo Scharf on Sunday named his squad for next week's World Cup soccer qualifier against Bulgaria, making few changes to the line-up he used for the European championship qualifying campaign. Scharf dropped Hapoel Haifa midfielder Reuven Atar from the squad which lost 2-0 to Romania in a friendly on August 14 and recalled Maccabi Tel Aviv defenders Amir Shelah and Alon Brumer. Forward Ronnie Rosenthal and midfielder Haim Revivo, who play in England and Spain respectively, were also included. Israel host the match on September 1. Squad: Goalkeepers - Bonnie Ginsburg, Rafi Cohen. Defenders: Felix Halfon, Gadi Brumer, Alon Brumer, Amir Shelah, Nir Klinger (captain), Yossi Abuksis, Alon Harazi, Alon Hazan, Tal Banin. Midfielders: Avi Nimni, Eyal Berkowitz, Itzik Zohar, Arik Bennado, David Amsalem. Forwards: Eli Driks, Ronnen Harazi, Haim Revivo, Ronnie Rosenthal. 2808 !GCAT !GSPO Dennis Springer tossed a five-hitter and Randy Velarde highlighted a seven-run fourth with a grand slam to power the California Angels to a 13-0 blanking of the Baltimore Orioles on Sunday. Springer walked two and struck out six for his first major-league complete game. "I threw strikes with the knuckleball and the rarity of the pitch ... they're not used to seeing it," Springer said. The Orioles have lost five of eight and were shut out for the second time in the three-game series. In Boston, Troy O'Leary hit a three-run homer and Jeff Frye added a two-run shot as the Boston Red Sox climbed above .500 for the first time this season with an 8-5 victory over the Seattle Mariners. Mike Maddux allowed one run over seven innings for the Red Sox, who have won six of seven games to move to 66-65. Boston began the season with a 6-19 slide. In Cleveland, Albert Belle celebrated his 30th birthday by delivering a two-run single in a five-run eighth inning as the Cleveland Indians rallied for an 8-5 victory over the Milwaukee Brewers, avoiding a three-game sweep. The Indians, who broke a three-game losing streak, trailed 5-3 entering the seventh. Belle hit .424 (14-for-33) with 10 RBI on Cleveland's nine-game homestand. In Kansas City, Todd Van Poppel won as a starter for the first time in nearly a year and Travis Fryman homered and drove in three runs, leading the Detroit Tigers to their fifth win in six games, 7-4 over the slumping Kansas City Royals. Van Poppel (2-6) allowed three runs and eight hits over six innings. At Minnesota, Rusty Greer and Dave Valle hit two-run homers and Kevin Elster added a three-run double in a seven-run first inning and Bobby Witt allowed six hits over eight innings as the Texas Rangers cooled off the Minnesota Twins 13-2. Elster homered and drove in five runs and Juan Gonzalez and Will Clark hit back-to-back homers for Texas, which won for the 12th time in 16 games. Minnesota dropped back to .500 (66-66) as it lost for just the sixth time in 19 games. In New York, Matt Stairs' leadoff homer snapped a ninth-inning tie and Mark McGwire homered and drove in four runs as the Oakland Athletics defeated the New York Yankees, 6-4. Stairs belted a 2-1 pitch off Jeff Nelson (4-4) over the centre-field fence for his seventh homer. Oakland won for just the third time in its last 13 road games and snapped a six-game losing streak to New York. In Chicago, former Blue Jay Pat Borders singled home Dave Martinez with one out in the bottom of the 10th inning as the Chicago White Sox snapped a five-game losing streak with a 10-9 victory over Toronto, who had their seven-game winning streak broken. Martinez began the bottom of the 10th with a double off Mike Timlin (1-5) and moved to third on a sacrifice by Domingo Cedeno, another former Blue Jay. After Tony Phillips was intentionally walked, Borders lined a 1-1 pitch to centre, scoring Martinez with the winning run. 2809 !GCAT !GSPO Results of Major League Baseball games played on Sunday (home team in CAPS): American League BOSTON 8 Seattle 5 CLEVELAND 8 Milwaukee 5 California 13 BALTIMORE 0 Oakland 6 NEW YORK 4 CHICAGO 10 Toronto 9 (10) Texas 13 MINNESOTA 2 Detroit 7 KANSAS CITY 4 2810 !GCAT !GSPO Major League Baseball standings after games played on Saturday (tabulate under won, lost, winning percentage and games behind): AMERICAN LEAGUE EASTERN DIVISION W L PCT GB NEW YORK 74 54 .578 - BALTIMORE 68 60 .531 6 BOSTON 65 65 .500 10 TORONTO 61 69 .469 14 DETROIT 46 83 .357 28 1/2 CENTRAL DIVISION CLEVELAND 76 53 .589 - CHICAGO 69 62 .527 8 MINNESOTA 65 64 .504 11 MILWAUKEE 62 68 .477 14 1/2 KANSAS CITY 59 72 .450 18 WESTERN DIVISION TEXAS 74 56 .569 - SEATTLE 66 62 .516 7 OAKLAND 62 70 .470 13 CALIFORNIA 60 69 .465 13 1/2 SUNDAY, AUGUST 25TH SCHEDULE SEATTLE AT BOSTON MILWAUKEE AT CLEVELAND CALIFORNIA AT BALTIMORE OAKLAND AT NEW YORK TORONTO AT CHICAGO TEXAS AT MINNESOTA DETROIT AT KANSAS CITY NATIONAL LEAGUE EASTERN DIVISION W L PCT GB ATLANTA 81 47 .633 - MONTREAL 70 58 .547 11 FLORIDA 60 70 .462 22 NEW YORK 59 71 .454 23 PHILADELPHIA 53 77 .408 29 CENTRAL DIVISION HOUSTON 69 61 .531 - ST LOUIS 68 61 .527 1/2 CINCINNATI 64 64 .500 4 CHICAGO 63 64 .496 4 1/2 PITTSBURGH 55 74 .426 13 1/2 WESTERN DIVISION SAN DIEGO 71 60 .542 - LOS ANGELES 69 60 .535 1 COLORADO 67 63 .515 3 1/2 SAN FRANCISCO 54 73 .425 15 SUNDAY, AUGUST 25TH SCHEDULE CHICAGO AT ATLANTA PITTSBURGH AT COLORADO NEW YORK AT LOS ANGELES PHILADELPHIA AT SAN DIEGO MONTREAL AT SAN FRANCISCO CINCINNATI AT FLORIDA ST LOUIS AT HOUSTON 2811 !GCAT !GSPO Rafael Palmeiro's two-out single in the sixth inning scored Roberto Alomar with the go-ahead run as the Baltimore Orioles rallied past the California Angels 5-4 and took over the American League's wild-card berth on Saturday. The Orioles trailed 4-3 when pinch-hitter Mike Devereaux led off the sixth with a triple against reliever Kyle Abbott (0-1) and scored the tying run on Alomar's single. After Brady Anderson sacrificed, Palmeiro hit the first pitch into right field for a single, scoring Alomar. In Boston, former Mariner Darren Bragg's first career grand slam in the sixth inning off reliever Randy Johnson lifted the Boston Red Sox to their fifth win in six games, a 9-5 victory over Seattle. "Just one of those things, I was just trying to make contact," said Bragg. "The bases were loaded and I had two strikes. I was just trying to put the ball in play. I got the good part of the bat on it and it carried out." In Cleveland, Kevin Seitzer's two-out single in the top of the 10th brought home David Hulse with the winning run as the Milwaukee Brewers sent the Cleveland Indians to their third straight extra-inning defeat 4-3. Bob Wickman (5-1), acquired from the New York Yankees on Friday, earned the win in his Milwaukee debut despite allowing the tying run in the eighth inning. At Minnesota, Marty Cordova and Matt Lawton hit solo homers and Frankie Rodriguez allowed six hits over seven innings to earn his first win as a starter in a month as the Minnesota Twins held on to beat the Texas Rangers 6-5. "Yeah, you know it's fun, it's always fun when you've got a chance to go to the ballpark and win a game that's important," said Rodriguez. "Every game should be important, but it's a little more important now." In New York, Wally Whitehurst allowed two runs over seven innings for his first win in more than two years and Paul O'Neill's three-run double snapped a sixth-inning tie as the New York Yankees held on for a 5-4 victory over the Oakland Athletics. Whitehurst, promoted from Triple-A Columbus on Wednesday, allowed seven hits and struck out one without a walk. It was his first win since defeating the St. Louis Cardinals on May 28th, 1994 when he was with the San Diego Padres. In Kansas City, Jose Rosado came within one out of his third complete game and Michael Tucker homered and drove in three runs as the Kansas City Royals broke a six-game losing streak with a 9-2 victory over the Detroit Tigers in a battle of cellar-dwellers. Rosado (5-3) allowed two runs -- one earned -- and seven hits over 8-2/3 innings with three walks and six strikeouts. In his last four starts, the 21-year-old left-hander has given up only four earned runs in 29-2/3 innings. 2812 !GCAT !GSPO Fred McGriff went 5-for-5 and homered twice, including a three-run blast with two out in the bottom of the ninth inning that lifted the Atlanta Braves to a 6-5 victory over the Chicago Cubs on Saturday. "I was just trying to hang in there and hit it up the middle," said McGriff about his homer in the ninth. "I was just looking for the ball, trying to stay on it. Brad Clontz (6-2) picked up the win in relief for Atlanta, which has won 11 of its last 13 games. In Colorado, Mark Thompson threw an eight-hitter for his third complete game and Ellis Burks homered and drove in three runs as the Colorado Rockies beat the Pittsburgh Pirates 9-3. Vinny Castilla and Dante Bichette each added two RBI for Colorado, which improved the major league's best home mark to 44-20. At Florida, Kevin Brown scattered seven hits over eight innings and Kurt Abbott snapped a sixth-inning tie with a two-run double as the Florida Marlins defeated the tired Cincinnati Reds 5-3. The Marlins won for just the third time in nine games, taking advantage of a Reds' team that has not had a day off since August 8th and was playing its fourth game in 43 hours. In Los Angeles, Tom Candiotti allowed two runs in seven innings and singled home the go-ahead run and Mike Piazza and Todd Hollandsworth drove in two runs apiece as the Los Angeles Dodgers defeated the New York Mets 7-5. Candiotti (8-9) walked one, allowed five hits and struck out a season-high eight batters for Los Angeles, which has won 10 of its last 14 games. In San Diego, Joey Hamilton allowed two hits over seven innings and Rickey Henderson hit his major league-record 69th leadoff homer as the San Diego Padres defeated the Philadelphia Phillies 7-1 for their fifth win in six games. Hamilton (12-7) won his second straight start, allowing just a sixth-inning run and a pair of singles. In San Francisco, Pedro Martinez allowed two hits in eight innings and David Segui drove in two runs as the Montreal Expos shut out the San Francisco Giants 3-0 for their third straight win. Martinez (11-7), who lasted just 1-1/3 innings in his last start against San Diego five days ago, pitched eight-plus innings, walking four and striking out 10. In Houston, Orlando Miller's two-run homer with one out in the bottom of the ninth off Todd Stottlemyre gave the Houston Astros a 3-1 win over the St. Louis Cardinals and left the teams in a virtual tie for the lead in the NL Central division. Shane Reynolds (16-6) fired a five-hitter, walking one and striking out six. 2813 !GCAT !GSPO Results of Major League Baseball games played on Saturday (home team in CAPS): National League ATLANTA 6 Chicago 5 HOUSTON 3 St Louis 1 LOS ANGELES 7 New York 5 Montreal 3 SAN FRANCISCO 0 FLORIDA 5 Cincinnati 3 COLORADO 9 Pittsburgh 3 SAN DIEGO 7 Philadelphia 1 American League BOSTON 9 Seattle 5 Milwaukee 4 CLEVELAND 3 (10 innings) BALTIMORE 5 California 4 Toronto 9 CHICAGO 2 NEW YORK 5 Oakland 4 KANSAS CITY 9 Detroit 2 MINNESOTA 6 Texas 5 2814 !GCAT !GSPO Portuguese champions Porto kicked off the season with a disappointing 2-2 home draw against Setubal and were lucky to squeeze in an equaliser in extra time. Porto, who are fighting to take their third consecutive title this season, were 2-0 down until the 86th minute when a header by Mario Jardel found the net after a string of missed opportunities, including a penalty taken by top league scorer Domingos Oliveira in the 60th minute. Domingos redeemed himself by netting the equaliser just into extra time. Setubal, who put on a skilful counter-attack throughout the game, opened the scoring 16 minutes into the match when an unmarked Chiquinho Conde shot around Porto's new Polish keeper Andrejez Wozniak. Conde scored his second in the 70th minute. Benfica, also playing their first game of the season at home, were held to a 1-1 draw by northern side Braga despite the fact that the visitors were reduced to 10 men in the 54th minute after Rodrigo Carneiro was sent off for a second bookable offence. Benfica dominated the game but their lack of a first-class striker was apparent throughout and in the 30th minute they lost key Brazilian midfielder Valdo who suffered a light knee injury. He was substituted by Paulao. Benfica finally opened the scoring in the 81st minute with a penalty taken by Helder after Luis Baltasar tripped up captain Joao Pinto under the referee's nose. Braga defender Idalecio gave his team their equaliser seven minutes from the final whistle with a header into the back of the net. 2815 !GCAT !GSPO Results of Portuguese first division soccer matches on Sunday: FC Porto 2 Setubal 2 Benfica 1 Braga 1 Guimaraes 4 Gil Vicente 2 2816 !GCAT !GSPO Argentine striker Gabriel Batistuta gave Fiorentina the perfect 70th birthday present on Sunday with two goals that gave the Italian Cup winners a 2-1 Supercup victory over serie A champions Milan. The victory, coming on the eve of the founding of the Florence club in 1926, also marked the first time since the pre-season trophy between the Cup winners and league champions was started in 1988 that the Cup winners had won. Batistuta gave Fiorentina the lead in the 11th minute. Sweden's Stefan Schwarz picked him out with a lob to the edge of the box and Batistuta did the rest, chipping veteran defender Franco Baresi and scoring at the near post. Montenegrin midfielder Dejan Savicevic equalised for the home team, weaving past a defender, checking and firing in a left-footed shot in the 21st minute that gave young Fiorentina goalkeeper Francesco Toldo little chance. The scored stayed level to the final minutes but with a penalty shoot out looming, Batistuta took charge. French international midfielder Marcel Desailly fouled the Argentine, whose coach at Boca Juniors before he joined Fiorentina in 1991 was new Milan coach Oscar Tabarez, and Batistuta rammed home the free kick from 30 metres out. The 83rd minute shot, curling over the defence and dipping in under the bar from the striker dubbed Batigol by adoring Fiorentina fans, was just reward for Fiorentina who looked a far more impressive team. Milan's player of the year George Weah missed a good first half opportunity but otherwise looked a little rusty while Italian team mate Roberto Baggio did not play due to injury. New Dutch signing Edgar Davids came on late in the second half as a Milan substitute but made little impact. The league season starts on September 8. 2817 !GCAT !GSPO Italian Cup winners Fiorentina beat league champions Milan 2-1 (halftime 1-1) in the pre-season Supercoppa (SuperCup) in Milan on Sunday: Scorers: Fiorentina - Gabriel Batistuta (11th, 83rd) Milan - Dejan Savicevic (21st) Attendance: 29,582 2818 !GCAT !GSPO Results of Norwegian elite division soccer matches at the weekend: Tromso 2 Kongsvinger 1 Valerenga 3 Skeid 0 Stabaek 4 Stromsgodset 0 Molde 1 Bodo/Glimt 2 Viking 1 Moss 0 Brann 7 Start 1 Rosenborg 7 Lillestrom 2 Standings after weekend matches (tabulate under played, won, drawn, lost, goals for, against, points): Rosenborg 20 14 4 2 68 21 46 Lillestrom 19 9 5 5 38 29 32 Skeid 19 10 2 7 29 30 32 Stabaek 20 7 8 5 41 34 29 Brann 19 8 5 6 40 37 29 Tromso 20 8 5 7 34 33 29 Viking 20 7 7 6 33 24 28 Molde 19 8 3 8 36 25 27 Bodo/Glimt 20 7 4 9 33 41 25 Kongsvinger 20 7 4 9 26 38 25 Stromsgodset 20 7 4 9 27 40 25 Valerenga 20 6 6 8 26 32 24 Moss 20 4 6 10 23 40 18 Start 20 3 3 14 26 56 12 2819 !GCAT !GSPO Summary of German first division match played on Sunday: MSV Duisberg 0 Bayern Munich 4 (Klinsmann 15th, Zieger 24th and 90th, Witechek 59th). Halftime 0-2. Attendance: 30,000. 2820 !GCAT !GSPO Result of German first division soccer match on Sunday: MSV Duisberg 0 Bayern Munich 4 Bundesliga standings after Sunday's game (tabulate under played, won, drawn, lost, goals for, goals against, points): Cologne 3 3 0 0 7 1 9 Bayern Munich 3 2 1 0 7 2 7 VfB Stuttgart 2 2 0 0 6 1 6 Borussia Dortmund 3 2 0 1 9 5 6 Hamburg 3 2 0 1 7 3 6 Bayer Leverkusen 3 2 0 1 7 4 6 VfL Bochum 3 1 2 0 3 2 5 Karlsruhe 2 1 1 0 5 3 4 St Pauli 3 1 1 1 7 7 4 1860 Munich 3 1 0 2 3 5 3 Freiburg 3 1 0 2 5 10 3 Fortuna Duesseldorf 3 1 0 2 1 7 3 Hansa Rostock 3 0 2 1 3 4 2 Arminia Bielefeld 3 0 2 1 2 3 2 Borussia Moenchengladbach 3 0 2 1 1 3 2 Schalke 3 0 2 1 4 8 2 Werder Bremen 3 0 1 2 4 6 1 MSV Duisburg 3 0 0 3 1 8 0 2821 !GCAT !GSPO Results of Swiss premier division matches played at the weekend: Aarau 1 Young Boys 0 Grasshopper 2 Lucerne 2 Lugano 1 Basle 1 Neuchatel 3 St Gallen 0 Sion 3 Servette 1 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Neuchatel 8 6 1 1 12 7 19 Grasshopper 9 4 4 1 17 11 16 St. Gallen 9 4 4 1 6 5 16 Lausanne 9 4 2 3 18 13 14 Aarau 8 4 1 3 9 4 13 Sion 9 3 4 2 13 11 13 Zurich 9 2 5 2 9 9 11 Basle 8 2 3 3 12 11 9 Servette 9 2 3 4 10 12 9 Lucerne 8 1 5 2 10 11 8 Lugano 9 1 4 4 6 15 7 Young Boys 9 1 0 8 6 19 3 2822 !GCAT !GSPO Leading prize money winners on the European Tour after Sunday's German Open (Britain unless stated): 1. Ian Woosnam 480,618 pounds sterling 2. Colin Montgomerie 429,449 3. Lee Westwood 301,972 4. Robert Allenby (Australia) 291,088 5. Mark McNulty (Zimbabwe) 254,247 6. Costantino Rocca (Italy) 253,337 7. Andrew Coltart 246,077 8. Wayne Riley (Australia) 233,713 9. Raymond Russell 229,360 10. Stephen Ames (Trinidad) 211,175 11. Frank Nobilo (New Zealand) 209,412 12. Paul McGinley (Ireland) 208,978 13. Paul Lawrie 207,990 14. Padraig Harrington (Ireland) 202,593 15. Retief Goosen (South Africa) 188,143 16. Jonathan Lomas 181,005 17. Paul Broadhurst 172,580 18. Peter Mitchell 170,952 19. Jim Payne 165,150 20. Russell Claydon 156,996 2823 !GCAT !GSPO Welshman Ian Woosnam won his fourth title of the season to take over from Scot Colin Montgomerie at the top of the European Order of Merit after rain washed out the last round of the German Open on Sunday. Woosnam was one of six players still to tee off on a day interrupted three times for thunderstorms and torrential rain when tournament director Andy McFee cancelled the fourth round and reduced the tournament to a 54-hole event. It left Woosnam, who has already won the Johnnie Walker Classic in Singapore, the Heineken Classic in Australia and the Scottish Open, on 20-under-par 193, six shots clear of Germany's Thomas Gogele, Spaniard Fernando Roca, Sweden's Robert Karlsson and Englishman Iain Pyman. Montgomerie did not compete here because his father is ill. Woosnam said he was disappointed with the outcome because he had been hoping to shoot 28 under par overall and set a PGA European Tour record. "It was a bit disappointing that I didn't have a chance to go for the record and it's disappointing for guys who shot good scores earlier today whose rounds have been scrapped," he said. New Zealander Frank Nobilo and Scotland's Andrew Coltart both shot 63, eight under par, to move up to joint second place, but both dropped back to joint 53rd after McFee's decision. "Obviously it's heart-breaking for them, but that is the weather and I'm just happy that I've won," said Woosnam. "Andy tried to let it go on as long as possible. He tried his hardest to play 72 holes and it was impossible. "Now my target is to be on top at the end of the year, so I will go out next week and try to make the gap a little bigger." 2824 !GCAT !GSPO Leading results in the 232-km Swiss Grand Prix World Cup cycling race on Sunday: 1. Andrea Ferrigato (Italy) 5 hours 51 minutes 52 seconds 2. Michele Bartoli (Italy) 3. Johan Museeuw (Belgium) 4. Lance Armstrong (U.S.) 5. Francesco Casagrande (Italy) 6. Alessandro Baronti (Italy) 7. Frank Vandenbroucke (Belgium) all same time 8. Fabio Baldato (Italy) 11 seconds behind 9. Maurizio Fondriest (Italy) 10. Laurent Jalabert (France) both same time Leading World Cup standings (after 8 of 11 rounds): 1. Museeuw 162 points 2. Ferrigato 112 3. Bartoli 108 4. Stefano Zanini (Italy) 88 5. Armstrong 81 6. Baldato 77 7. Alexandre Gontchenkov (Ukraine) 67 8. Gabriele Colombo (Italy) 58 9. Andrei Tchmil (Ukraine) 56 10. Max Sciandri (Britain) 55 2825 !GCAT !GSPO Andrea Ferrigato of Italy sprinted to his second cycling World Cup win in successive weekends with victory in the Swiss Grand Prix on Sunday. Ferrigato, winner of the Leeds Classic last Sunday with a one second win over Britain's Max Sciandri, posted a similarly narrow margin of victory again. The 26-year-old Italian surged past compatriot Michele Bartoli and last year's winner and defending World Cup champion Johan Museeuw of Belgium in the final few metres of the 237km race. All three clocked the same time of five hours 51 minutes, 52 seconds. Former world champion Lance Armstrong of the United States was in front as the leading pack of seven riders turned into the Oerlikon velodrome for the final one lap sprint but quickly faded and settled for fourth. The back-to-back wins vault Ferrigato from sixth to second in the overall World Cup rankings with 112 points but Museeuw continues to hold a commanding lead with 162 points after eight of the 11 rounds. 2826 !GCAT !GSPO Briton Ian Woosnam won the German Open golf championship on Sunday after the final round was abandoned because of torrential rain. Scores after three rounds (Britain unless stated): 193 Ian Woosnam 64 64 65. 199 Thomas Gogele (Germany) 67 65 67, Robert Karlsson (Sweden) 67 62 70, Ian Pyman 66 64 69, Fernando Roca (Spain) 66 64 69. 200 Diego Borrego (Spain) 69 63 68, Miguel Angel Martin (Spain) 66 66 68. 201 Stephen Ames (Trinidad) 68 65 68, Roger Chapman 72 62 67, Paul Broadhurst 62 70 69, Stephen Field 66 65 70, Carl Suneson (Spain) 65 66 70 202 Greg Turner (New Zealand) 70 67 65, Heinz-Peter Thul (Germany) 70 67 65, Ronan Rafferty 64 72 66, Barry Lane 68 67 67, David Carter 66 69 67, Michael Jonzon (Sweden) 67 67 68, David Williams 67 67 68 203 Lee Westwood 66 71 66, Gary Emerson 68 69 66, Peter Baker 70 66 67, Des Smyth (Ireland) 66 69 68, Paul Lawrie 66 69 68, Francisco Cea (Spain) 68 66 69, Pedro Linhart (Spain) 67 67 69, Jonathan Lomas 67 67 69, Paul Eales 67 68 68, Raymond Russell 63 69 71 2827 !GCAT !GSPO Belgian international Luc Nilis scored twice on Sunday as PSV Eindhoven came from behind to beat Groningen 4-1 in Eindhoven. PSV and Vitesse Arnhem are the only unbeaten teams after two rounds of the Dutch league. Defending champions Ajax Amsterdam were defeated 2-0 loss away to Heerenveen on Saturday. Groningen took the lead in the seventh minute when Dean Gorre intercepted a back pass from Ernest Faber to goalkeeper Ronald Waterreus and shot home. Faber made amends in the 32nd minute when he headed in a corner to score the equaliser. PSV took control in the second half but could not score until Groningen striker Romano Sion was sent off in the 58th minute. Five minutes after his dimissal, Nilis gave PSV the lead and in the final 15 minutes he added another as did Zeljko Petrovic. Vitesse Arnhem upstaged Utrecht 1-0 despite ending the match with only nine men following the dismissal of defenders Raymond Atteveld and Erwin van der Looi. Gaston Taument scored twice and newly signed Argentine Pablo Sanchez once in Feyenoord Rotterdam's 3-0 victory over Volendam. 2828 !GCAT !GSPO Results of Belgian first division soccer matches at the weekend: Genk 1 Club Brugge 1 Harelbeke 3 Mechelen 3 Standard Liege 3 Molenbeek 0 Anderlecht 2 Lokeren 2 Cercle Brugge 2 Mouscron 2 Antwerp 1 Lommel 4 Ghent 3 Aalst 2 Lierse 4 Charleroi 0 Sint Truiden 3 Ekeren 1 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Ghent 4 3 1 0 9 5 10 Standard Liege 4 3 0 1 7 3 9 Club Brugge 4 2 2 0 10 4 8 Mouscron 4 2 2 0 7 4 8 Anderlecht 4 1 3 0 9 3 6 Lierse 4 1 3 0 7 3 6 Antwerp 4 2 0 2 6 10 6 Genk 4 1 2 1 6 5 5 Molenbeek 4 1 2 1 4 5 5 Harelbeke 4 1 1 2 6 7 4 Aalst 4 1 1 2 5 6 4 Lokeren 4 1 1 2 4 5 4 Ekeren 4 1 1 2 6 8 4 Lommel 4 1 1 2 5 10 4 Mechelen 4 0 3 1 6 7 3 Cercle Brugge 4 0 3 1 4 5 3 Charleroi 4 1 0 3 4 8 3 Sint Truiden 4 1 0 3 4 11 3 2829 !GCAT !GSPO Summary of Dutch first division soccer played on Sunday: Feyenoord Rotterdam 3 (Sanchez 27th, Taument 44th, 57th) Volendam 0. Halftime 2-0. Attendance not given. NEC Nijmegen 0 AZ Alkmaar 0. Attendance not given. Vitesse Arnhem 1 (Van Wanrooy 58th) Utrecht 0. Halftime 0-0. Attendance 7,032. Twente Enschede 1 (Hoogma 30th) Roda JC Kerkrade 1 (Roelofsen 28th). Halftime 1-1. Attendance not given. PSV Eindhoven 4 (Faber 32nd, Nilis 63rd 79th, Petrovic 78th) Groningen 1 (Gorre 7th). Halftime 1-1. Attendance 27,500 Played on Saturday: Graafschap Doetinchem 3 (Ibrahim 20th 63rd, Godee 54th) RKC Waalwijk 2 (Dos Santos 38th, Van Arum 73th penalty). Halftime 1-1. Attendance 7,000 Willem II Tilburg 0 Fortuna Sittard 1 (Hamming 65th). Halftime 0-0. Attendance 7,250. NAC Breda 1 (Arnold 70th) Sparta Rotterdam 0. Haldtime 0-0. Attendance 11,500. Heerenveen 2 (Wouden 53rd, Dahl Tomasson 74th) Ajax Amsterdam 0. Halftime 0-0. Attendance 13,500. 2830 !GCAT !GSPO Result of Dutch first division soccer match played on Sunday: Feyenoord Rotterdam 3 Volendam 0 NEC Nijmegen 0 AZ Alkmaar 0 Vitesse Arnhem 1 Utrecht 0 Twente Enschede 1 Roda JC 1 PSV Eindhoven 4 Groningen 1 Played on Saturday: Graafschap Doetinchem 3 RKC Waalwijk 2 Willem II Tilburg 0 Fortuna Sittard 1 NAC Breda 1 Sparta Rotterdam 0 Heerenveen 2 Ajax Amsterdam 0 Standings (tabulate under played, won, drawn, lost, goals for, goals against, points): PSV Eindhoven 2 2 0 0 8 2 6 Vitesse Arnhem 2 2 0 0 3 0 6 Feyenoord Rotterdam 2 1 1 0 4 1 4 Graafschap Doetinchem 2 1 1 0 4 3 4 Twente Enschede 2 1 1 0 4 2 4 Fortuna Sittard 2 1 1 0 1 0 4 Heerenveen 2 1 0 1 3 3 3 NAC Breda 2 1 0 1 1 1 3 Ajax Amsterdam 2 1 0 1 1 2 3 Roda JC Kerkrade 2 0 2 0 2 2 2 Utrecht 2 0 1 1 2 3 1 RKC Waalwijk 2 0 1 1 4 5 1 Sparta Rotterdam 2 0 1 1 0 1 1 Willem II Tilburg 2 0 1 1 0 1 1 AZ Alkmaar 2 0 1 1 0 2 1 Volendam 2 0 1 1 1 4 1 Groningen 2 0 1 1 1 4 1 NEC Nijmegen 2 0 1 1 1 4 1 2831 !GCAT !GSPO Brazilian international Flavio Conceicao was set to join Spanish club Real Madrid in a deal worth five million dollars, the Marca sports daily said on Sunday. "I want to go to Real Madrid," the Palmeiras midfielder said. His Brazilian club was studying various offers for the 22-year-old, including one from Italy worth $500,000 more, Marca said. But trainer Fabio Capello was confident the deal would go through this week as the two clubs have had excellent relations since Palmeiras signed Colombian international Freddy Rincon from Real Madrid. 2832 !GCAT !GSPO Dutch soccer captain Danny Blind has decided to end his international career, Ajax spokesman David Endt said on Sunday. Endt told Dutch news agency ANP that Blind, 35, would no longer be available for selection for the national squad. The Ajax defender, who led the Netherlands into the quarter-finals at June's European championship finals in England, had decided to devote his attention to playing for his Amsterdam club, Endt said. Blind, who played in the 1990 World Cup and the 1992 European championship, was capped 42 times for the Netherlands. 2833 !GCAT !GSPO Indian opener Navjot Singh Sidhu was on Sunday given a 50-day ban from international cricket for quitting this year's tour of England, the Press Trust of India said. The right-handed batsman will have to forfeit half the money he was due to earn from the tour, the news agency said after a disciplinary committee set up by the Board of Control for Cricket in India met at Mohali, near the northern city of Chandigarh. Sidhu abandoned the Indian team after the third one-day international against England at Old Trafford in Manchester on May 26, before India began a three-test series, citing serious differences with captain Mohammed Azharuddin. Azharuddin was sacked after the tour and replaced by Sachin Tendulkar. Sidhu was not considered for the four-nation Singer Cup beginning in Sri Lanka this month and the Sahara Cup against Pakistan scheduled to be played in Canada next month. Sidhu, whose ban ends on October 14, will be free to play domestic cricket. He will not be considered for a test match against Australia starting on October 10 in New Delhi, the United News of India said. 2834 !C12 !CCAT !GCAT !GCRIM Brush Wellman Inc has become the target of some lawsuits concerning chronic beryllium disease (CBD), a potentially fatal lung ailment, according to the New York Times. The company disclosed the lawsuits in a recent annual filing with the U.S. Securities and Exchange Commission, the newspaper reported in its Sunday edition. Brush Wellman spokesman Timothy Reed told the paper that several of these actions, including one that sought class-action status, were recently dismissed. About 14 lawsuits, filed largely by employees of industrial customers, were still pending, Reed told the newspaper. The workplace disease occurs only in a small minority of people whose immune systems are susceptible to beryllium, apparently because of their genetic makeup, the paper said. Brush Wellman is the leading U.S. producer of beryllium in the United States. The company said it denies doing anything wrong and said it has been at the forefront of CBD research for decade, the paper said. Company executives were not immediatley available for comment on the New York Times report. 2835 !C31 !CCAT !GCAT !GENT "The Island of Dr. Moreau" overcame some of the worst reviews of the year to open at the top of the U.S. box office with an estimated gross of $9.0 million at the weekend. Marlon Brando and Val Kilmer star in the third big-screen adaptation of the H.G. Wells science-fiction novel, a troubled project that saw the firing of one director and the departure of one of the stars. The movie is released by New Line Cinema, a unit of Turner Broadcasting System Inc. Slipping to second place for the Friday to Sunday period was "Tin Cup" with $8.8 million, according to Exhibitor Relations Co. Inc. The Kevin Costner golfing comedy, released by Time Warner Inc's Warner Bros., has a 10-day gross of $23.9 million. It dipped 13 percent from last weekend. Opening in third with $7.4 million was "A Very Brady Sequel", the second movie based on the Brady Bunch television series. Warner Bros.' "A Time To Kill" was fourth with $6.2 million followed by Walt Disney Co's "Jack" with $5.9 million. The movie that earned the most per screen was the romantic comedy "She's The One", which opened in 10th with $2.2 million. The romantic comedy from News Corp's 20th Century Fox, averaged $4,793 per screen, the highest tally in the top-10. "Moreau" followed with a per-screen average of $4,423. According to a Variety poll of critics in New York, Los Angeles, Chicago and Washington DC, only two liked "Moreau", while 17 did not and 13 were mixed. The Los Angeles Times said it was "disastrous", while Variety said it was "an embarrassment for all concerned." Mitch Goldman, New Line's marketing and distriibution president, said the studio "didn't necessarily expect it to be number one this weekend." The PG-13 movie played to predominantly younger audiences, and New Line is going to fine-tune the marketing to appeal to adults by emphasizing the science-fiction nature over the horror. Goldman said Brando planned to appear on Larry King's CNN talk show this week to drum up support for the movie. "I think he feels that the critics were unjustifiably cruel, and I think he would like to help people get over them (the critics) and see this movie," Goldman said. John Frankenheimer directed the movie, replacing Richard Stanley who reportedly had differences with Kilmer. After his departure, actor Rob Morrow left and was replaced by David Thewlis. The Brady movie, released by Viacom Inc's Paramount Pictures, averaged a disappointing $3,447 per screen. The first instalment opened at the top of the box office with a four-day total of $14.82 million (average $8,138) during the President's Day holiday in February 1995. Following are the rest of the top 10 with last weekend's position in parenthesis. (* = new release) 6 (5) Independence Day .................. $4.9 million 7 (4) The Fan .......................... . $3.5 million 8(11) Emma ........... . ................ . $2.5 million 9 (*) Solo .............................. $2.3 million 10 (*) She's The One ..................... $2.2 million NOTE: "Independence Day" is released by 20th Century Fox. "The Fan" and "Solo" are released by Sony Corp.. "Emma" is released by Disney's Miramax Films. 2836 !GCAT !GDIS !GWEA Two storms threaten shipping in the western Pacific Ocean. Typhoon Orson is expected to track northeastward from near 25n/149e to near 27n/151e during the next 48 hours, over open waters. Top winds, now near 130 mph, are expected to increase to near 155 mph this period. Orson is a major threat to shipping. Tropical Storm Piper is weakening and will begin to lose tropical characteristics this period. The storm is expected to track northward from near 37n/159e to 44n/161e during the next 36 hours as winds drop from 70 mph to 45 mph. Dangerous Hurricane Edouard is a threat only to shipping at this time. The storm has top winds of 145 mph and is centerd 850 miles east of the Leeward Islands in the Atlantic Ocean, moving to the west northwest at 14 mph. This motion is expected to continue during the next 24-48 hours as the storm changes little in strength. The current longer range forecast track for the storm keeps it to the northeast of the Leeward Islands, but this will have to be watched closely. There are no further statements at this time. 2837 !C12 !C13 !C21 !CCAT !GCAT !GCRIM !GHEA Britain's health ministry won a court injunction on Sunday banning distribution of a commercial video that shows gory close-up details of more than 20 real operations such as eye surgery and removal of the bowel. Health Minister Gerry Malone said in a statement he would investigate whether the video -- which had been due to be released through video rental shops from Monday -- had breached patients' right to confidentiality. "On the information we have got, the acquisition and use of this material is in direct conflict with the guidance that was issued on patient confidentiality to the National Health Service in March of this year," Malone said. He said a full court hearing would be held on Wednesday. The British Medical Association (BMA) said patients could be put off having potentially life-saving operations after watching "Everyday Operations", a 53-minute collection of surgeons' training videos. "We urge people not to watch this video," said Dr Vivian Nathanson, head of the BMA's ethics committee. "It is deeply distasteful and very worrying. This is the first time we have heard of such a video." Eduvision, the company responsible, also sparked controversy earlier this year by releasing "Executions", a video showing a number of real executions. It was later withdrawn. Eduvision spokesman David Donughue denied the operations video would attract morbid audiences seeking voyeuristic excitement, saying it was an informative film which would enlighten the public about the real work of hospitals. Other operations featured in the film include shoulder, hip and knee replacements, gall bladder and appendix removals, brain surgery and varicose vein treatments. 2838 !GCAT Following are some of the major events to have occurred on September 1 in history. 1159 - Pope Adrian IV (Nicholas Breakspear), the only Englishman to be Pope, died. 1494 - Charles VIII of France invaded Italy in an attempt to claim the throne of Naples. 1715 - King Louis XIV of France died. Known as the "Sun King" he had ruled since the age of five. 1822 - Hiram Rhodes Revels born. He was a U.S. clergyman, politician and the first black member of congress. 1854 - Engelbert Humperdinck, German composer best known for his fairy-tale operas "Hansel and Gretel" and "Die Konigskinder", born. 1858 - The East India Company's government of India ended with the British Crown taking over its territories and duties. 1864 - The Charlottetown Conference began on Prince Edward Island, representing the first steps toward Canadian confederation. 1864 - Sir Roger David Casement born. An Irish nationalist, he was hanged as a traitor by the British in 1916. 1875 - Edgar Rice Burroughs born. He was an American novelist best known for his series of Tarzan books. 1878 - Emma Nutt became the first woman telephone operator. 1900 - South African Republic was annexed by Britain. 1916 - Bulgaria declared war on Romania in World War One. 1923 - An earthquake which measured 7.9 on the Richter scale struck Japan and completely destroyed Yokahama and nearly destroyed Tokyo. At least 142,000 people were killed and 2.5 million made homeless. 1928 - Albania was declared a kingdom, with Zog I as ruler. 1939 - Germany invaded Poland at daybreak, signalling the start of World War Two. Norway, Finland and Switzerland declared their neutrality and Italy said it was "non-belligerent". 1946 - Greeks voted to recall their King, George II, to the throne. He had been living in exile in England. 1960 - Julius Nyerere became Tanganyika's prime minister. 1961 - The Soviet Union carried out a threat to resume nuclear tests, exploding an atomic bomb in central Asia. 1967 - An Arab summit lifted the oil embargo on Western states imposed during the Six-Day war. 1969 - Military officers overthrew the Libyan government and the Libyan Arab Republic was proclaimed under Colonel Muammar Gaddafi. 1974 - Anastasio Somoza was elected President of Nicaragua. 1975 - Israel and Egypt reached an interim accord, brokered by Henry Kissinger, on Israeli withdrawal from Sinai. 1979 - The U.S. unmanned spacecraft Pioneer II, launched in 1973, transmitted data to Earth after coming within 12,560 miles of Saturn's clouds. 1981 - A bloodless coup ousted President David Dacko of the Central African Republic. 1982 - Former Polish leader Wladyslaw Gomulka died, aged 77. 1983 - A Soviet fighter plane shot down a Korean Air Lines Boeing 747 near Sakhalin island, killing all 269 on board. 1990 - Czechoslovakia and the Soviet Union signed the first agreement between Comecon countries to conduct their trade in convertible currencies and use world prices. 1993 - Russian President Boris Yeltsin said he was sacking vice-president Alexander Rutskoi and first deputy prime minister Vladimir Shumeiko. 1995 - Chief warlord Charles Taylor and other key militia leaders were installed in a new ruling council in Liberia. 2839 !GCAT !GPRO Buckingham Palace threatened action on Sunday against a British newspaper that published a photograph of heir-to-the-throne Prince Charles with his lover Camilla Parker Bowles. The picture prompted speculation that Charles or someone else in the royal family was testing the waters to see how the British public would react to a formal relationship between the pair -- whether marriage or just being seen together in public. Charles and his estranged wife Diana become officially divorced on August 28. The News of the World, claiming to have the first photos in 20 years of Charles, 48, in the company of his long-time love, published a picture of him strolling in a loose group with her, along with another man and woman near a country house in Wales. The weekly plastered the shot on its front page and said it had been given an anonymous tip-off that the two would be together. But Buckingham Palace denied it had connived at the photo opportunity. "We would not give approval to such intrusive photographs being taken of the Prince of Wales in his private time," a spokeswoman said. "Paparazzi shots do not amount to a conspiracy." "We deplore any intrusion of this nature on the royal family. Over the next few days we will be considering courses of action we might take." The spokeswoman would not speculate on legal action, but in the past the royal family has approached the self-regulatory Press Complaints Commission. A survey published in The Sunday Telegraph showed that bishops and clergy were strongly against against Charles, who is in line to become head of the Church of England, re-marrying. "I don't think, quite frankly, the public could tolerate a Queen Camilla," John Taylor, the retired Bishop of St Albans, told the newspaper. "What the bishops are saying is that it would extremely difficult for the king, as supreme governor of Church of England, to be remarried in church because that is contrary to church law," a Church of England spokesman said. The rules did not bar a civil marriage followed by a blessing in church, he said. Another option would be to remarry in Scotland where different rules applied. Queen Elizabeth's only daughter Princess Anne chose that route when she married naval commander Timothy Laurence after her divorce from captain Mark Phillips. Charles, who admitted adultery after he separated from Diana in 1992, has said he has no immediate intention of remarrying. He will be on holiday with his two sons in Scotland when the divorce becomes final. His soon-to-be ex-wife will keep an equally low profile and plans to have a quiet day at Kensington Palace when the marriage becomes one of Britain's latest divorce statistics. 2840 !C12 !C17 !CCAT !GCAT !GCRIM Lloyd's of London said on Sunday that 75 percent of its members had accepted its recovery plan as of midday Saturday. Lloyd's also said that its appeal against an injunction served against it in a crucial U.S. court case would be heard on Tuesday in Baltimore, Maryland. U.S. district judge Robert Payne ordered late on Friday night in Virginia that the insurance market make more information available to American Names by September 23. With just days to go before its Wednesday deadline for the 33,500 investors worldwide -- called Names -- to accept or reject the plan, Payne has not prevented U.S. Names from making this decision. However, those who elect to wait can pay funds into an escrow account no later than September 30 and have until October 30 to accede or not. There are 2,700 U.S. Names. Under the recovery proposals, Lloyd's aims to reinsure billions of pounds in liabilities into a new company called Equitas. The plan includes a 3.2 billion stg settlement offer to Names to soften the cost to them of this and end litigation. "I am confident that, by the deadline, the offer will have been accepted by the overwhelming majority of our members," chairman David Rowland said in a brief statement. Confirming that the appeal against the ruling will be heard on Tuesday in the U.S. appeals court in Baltimore, Maryland, Lloyd's said Names would be advised of any consequences arising from the case and the deadline for acceptances remained noon London time on Wednesday. -- London Newsroom, +44 171 542 7717 2841 !C13 !CCAT !GCAT !GHEA British medical official on Sunday condemned a commercial video which shows gory close-up details of more than 20 real operations such as eye surgery, removal of the bowel and penile implants. The British Medical Association (BMA) described "Everyday Operations" as deeply distasteful and said patients could be put off having potentially life-saving operations after watching it. "We urge people not to watch this video...It is deeply distasteful and very worrying. This is the first time we have heard of such a video," said Dr Vivian Nathanson, head of the BMA's ethics committee. Eduvision, the company responsible for the 53-minute collection of surgeons' training videos, also sparked controversy earlier this year by releasing a video showing a number of real executions. It was later withdrawn. Health Minister Gerry Malone said he would investigate whether "Everyday Operations" -- due to be released on Monday -- had breached the patients' right to confidentiality. Eduvision spokesman David Donughue denied the video would attract morbid audiences seeking voyeuristic excitement, saying it was an informative film which would enlighten the public about the real work of hospitals. Other operations featured in the film include shoulder, hip and knee replacements, gall bladder and appendix removals, brain surgery and varicose vein treatments. 2842 !GCAT These are some of the leading stories in two London-based Arabic-language newspapers on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. AL-HAYAT - Jordan tightens security around Iraqi embassy in Amman. - Saudi Defence Minister Prince Sultan to visit Yemen on Wednesday. - Savola Company of Saudi Arabia invests $266 million in industrial and agricultural fields. ASHARQ AL-AWSAT - Jordan intends to pull out ambassador from Iraq; security forces storm Baath party headquarters in Amman. - Managing director of the Saudi Cement Company Olayan urges the setting up of a new company to export Saudi cement. 2843 !GCAT !GSPO THE AUSTRALIAN Defending champion Greg Norman has slipped three strokes behind leader Phil Mickelson after the third round of the US$2.1 million World Series of golf. Norman will be paired with Nick Faldo for the final round - the first time the two have been paired sice Norman's final-round collapse at the US Masters four months ago. Page 25. -- At Winton in rural Victoria yesterday, Veteran Geoff Brabham won the opening 30-lap heat in a BMW and Steven Richards won the second race in a Honda Accord, breaking the dominance of Audi drivers Brad Jones and Greg Murphy, who have won seven of the eight races in the previous four rounds of this year's Australian two-litre super touring championship. Page 26. -- The Victoria Amateur Turf Club has opened an investigation into an incident at Caulfield yesterday where a racegoer threw an unidentified substance over the neck of racehorse Future Shock, an entrant for the Sir Richard Williams Handicap. Page 27. -- THE SYDNEY MORNING HERALD The Brisbane Broncos returned to their stunning form of old on the weekend to defeat the Gold Coast Chargers 38-10. Behind 10-6 at half time, the Broncos scored six tries in the second half, with winger Wendell Sailor leading the comeback. Page 23. -- Sydney City coach Phil Gould will be hoping Ivan Cleary and Tim Maddison can pass last-minute medicals today to boost an under-strength team for the clash with Cronulla at the Sydney Football Stadium tonight. Brad Fittler, Matt Sing and Darren Junee havealready pulled out through injury. Page 23. -- The Australian men's wheelchair basketball team beat Great Britain 78-63 last night, keeping the Australian medal tally in touch with the United States at the top of the table. The Australians took out the gold in front of a record crowd of 10,162 - the largest ever to see a wheelchair basketball match. Page 24. -- THE AGE Fitzroy players, officials and supporters attended their own funeral at the Melbourne Cricket Ground yesterday as the 100-year-old Australian Rules team played its last game in Melbourne. More than 48,000 people witnessed the final game, which saw the club thrashed by Richmond by 151 points. Page 1. -- After a hard, injury-plagued year the West Coast Eagles are happy to have a West Australian AFL semi-final secured, but coach Mick Malthouse says despite the Eagles' 73-point win over Melbourne yesterday, the team still has to face the second top side, the Swans, in Sydney next week. Page 6. -- A win in the Up And Coming Stakes at Randwick on Saturday has prompted Paint's owners to stick to the dry tracks, choosing to keep the brilliant three-year-old in Sydney for the next five weeks if Melbourne's tracks do not dry out. Page 19. -- HERALD SUN The Melbourne Tigers are favourites for the National Basketball League championship after two away victories on the weekend against Perth and Adelaide. The Tigers took their game record to 16-4 and 9-1 on the road with a 99-96 win over the Wildcats and a123-112 victory over the 36ers. Page 92. -- Pole vaulter Paul Burgess yesterday became the first Australian to win any pole vault medal at the junior level after beating Sweden's Patrik Kristiansson and Germany's Daniel Ecker on his 11th jump to take out gold at Sydney's world junior athletics championships. Page 94. -- Two of the 1996 AFL season's biggest stars will face the tribunal tonight after separate incidents on the weekend. Brownlow Medal favourite, Collingwood's Nathan Buckley, was reported for tripping during the Magpies' win against Adelaide and the Sydney Swans' Tony Lockett will make his 10th tribunal appearance on a striking charge against Essendon's Barry Young. Page 96. -- THE DAILY TELEGRAPH Sydney Flames guard Michelle Timms broke the all-time record of 958 assists on the weekend and helped secure her basketball team a home court semi-final, defeating Canberra 79-71. Timms needed only three assists to break the record, but came up with 10 and 19 points. Page 28. -- After scoring a million-dollar NBA contract with the Minnesota Timberwolves, the Sydney Kings' Shane Heal ended his week on a less glorious path. Immediately after the Kings' loss to Brisbane on Saturday night, Heal allegedly grabbed referee Graham Clark by the wrist and swore at him, risking a fine or a suspension. Page 28. -- Although X-rays have cleared him of a broken hand, Canberra Raiders front-rower John Lomax is still in a lot of pain and will receive a more detailed scan tomorrow. The news offers some hope to the Raiders, who were sure Lomax had broken his hand and would miss the finals after Canberra's crushing defeat of Auckland, 30-6, at Bruce Stadium. Page 30. -- Reuters Sydney Newsroom 61-2 9373-1800 2844 !GCAT !GSPO Australian rugby league premiership standings after matches played at the weekend (tabulate under played, won, drawn, lost, points for, against, total points): Manly 21 17 0 4 501 181 34 Brisbane 21 16 0 5 569 257 32 North Sydney 21 14 2 5 560 317 30 Sydney City 20 14 1 5 487 293 29 Cronulla 20 12 2 6 359 258 26 Canberra 21 12 1 8 502 374 25 St George 21 12 1 8 421 344 25 Newcastle 21 11 1 9 416 366 23 Western Suburbs 21 11 1 9 382 426 23 Auckland 21 11 0 10 406 389 22 Sydney Tigers 21 11 0 10 309 435 22 Parramatta 21 10 1 10 388 391 21 Sydney Bulldogs 21 10 0 11 325 356 20 Illawarra 21 8 0 13 395 432 16 Western Reds 21 6 1 14 297 398 13 Penrith 21 6 1 14 339 448 13 North Queensland 21 6 0 15 266 593 12 Gold Coast 21 5 1 15 351 483 11 South Sydney 21 5 1 15 304 586 11 South Queensland 21 4 0 17 210 460 8 -- Sydney Newsroom 61-2 9373-1800 2845 !GCAT !GSPO PRETORIA, Aug 25 - A medical scan has cleared fears of serious damage to Ian Jones' knee today, but he remains doubtful for the All Blacks third rugby test against South Africa next Saturday (Sunday NZ time). All Blacks coach John Hart said he was relieved with the result of the scan, which showed no damage to either Jones' ligaments or cartilage, and is hopeful the North Harbour lock will be available as New Zealand attempt an unprecedented cleansweep in the series. Jones was limping today after being forced out of yesterday's historic 33-26 second test victory at Loftus Versfeld when New Zealand secured a series victory on South African soil for the first time. He made the lineout his kingdom before retiring injured. Whilst he's in doubt, it's a strained knee, there is a possibility now that he might be right for Saturday, which would be great,'' Hart said. The prognosis for first five-eighth Simon Culhane was not as bright. An X-ray confirmed a broken bone in Culhane's wrist. Culhane has been ruled out of the final test, for which Andrew Mehrtens is likely to return following his knee injury and subsequent operation. The third test side will be named on Wednesday. Congratulatory messages were still pouring into the team hotel today as a tired but triumphant side packed up to leave for Kimberley to play their final midweek fixture before the last test. Prime Minister Jim Bolger rang the team and said they had done the country proud, Hart confirmed. The team had become the first All Blacks side to win a test series in South Africa, a feat that has been eluding the nation for 75 years. It also nudged New Zealand ahead 22-21 in 46 tests against South Africa, with three matches being drawn. 2846 !GCAT !GSPO PRETORIA, Aug 25 - Captain Sean Fitzpatrick and his All Blacks revisited the test venue today to relive some of the magic moments of yesterday's momentous rugby victory over South Africa, NZPA reported. Most of the test 15 who beat the Springboks 33-26 to secure New Zealand's first-ever rugby series in South Africa stood in the middle of the empty 50,000-seat Loftus Versfeld. Magnificent,'' said Fitzpatrick, New Zealand's most capped player and the world's most capped forward. The players relived the moves and tries, the tackles and what might have been as the emotions of victory continued. Zinzan Brooke, the only No 8 in test rugby to have scored a dropped goal when he kicked a three-pointer against England during last year's World Cup, added a second to his name yesterday. I was right here,'' he said standing at the spot where he had received the ball for the kick. The maul was there and I was going to go in but I thought I should hold off because we had the ball. When (halfback) Justin Marshall got the ball he was going to go on the openside where Jon Preston was so I emptied my lung at him to get the ball this way. I just hit through and I was punching the air before the ball got there. It cost me a few bucks at the bar.'' The decision to attempt a dropped goal was a spontaneous one, Brooke said. It was just like the World Cup, the ball came and the chance was there.'' Centre Frank Bunce said he had never felt so exhausted during a match. We were gutted and there was nowhere to hide, they just kept coming at you,'' he said. I was gone in the first 20 minutes, completely exhausted, but you had no choice. There was just so much riding on it. It's amazing just how big this ground was yesterday.'' Two-try winger Jeff Wilson said he was so tired that he kept asking Bunce where he should be while defending. He told me I'm buggered too so just hang in there','' Wilson recalled. About 4000 New Zealander supporters were partying into the early hours of today in the South African capital. Messages of goodwill continued to roll into the team hotel. All Blacks coach John Hart said Prime Minister Jim Bolger rang him today to offer his congratulations. He thanked us on behalf of the country, which is really nice for the team, and I understand we had tremendous support at home.'' 2847 !GCAT !GSPO Results of Australian Rules matches played at the weekend. Played Sunday: Adelaide 14.12 (96) Collingwood 24. 9 (153) West Coast 24. 7 (151) Melbourne 11.12 (78) Richmond 28.19 (187) Fitzroy 5. 6 (36) Played Saturday: Carlton 13.18 (96) Footscray 9.12 (66) Essendon 14.16 (100) Sydney 12.10 (82) St Kilda 9. 9 (63) Hawthorn 12. 8 (80) Brisbane 10.11 (71) Fremantle 10.10 (70) Played Friday: North Melbourne 14.12 (96) Geelong 16.13 (109) Standings (tabulate under played, won, drawn, lost, points for, against, percentage, total points): Brisbane 21 15 1 5 2123 1631 130.2 62 Sydney 21 15 1 5 2067 1687 122.5 62 West Coast 21 15 0 6 2151 1673 128.6 60 North Melbourne 21 15 0 6 2385 1873 127.3 60 Carlton 21 14 0 7 2009 1844 108.9 56 Geelong 21 13 1 7 2288 1940 117.9 54 Essendon 21 13 1 7 2130 1947 109.4 54 Richmond 21 11 0 10 2173 1803 120.5 44 Hawthorn 21 10 1 10 1791 1820 98.4 42 St Kilda 21 9 0 12 1909 1958 97.5 36 Collingwood 21 8 0 13 2103 2091 100.6 32 Adelaide 21 8 0 13 2158 2183 98.9 32 Melbourne 21 7 0 14 1642 2361 69.5 28 Fremantle 21 6 0 15 1673 1912 87.5 24 Footscray 21 5 1 15 1578 2060 76.6 22 Fitzroy 21 1 0 20 1381 2778 49.7 4 -- Sydney Newsroom 61-2 9373-1800 2848 !GCAT !GSPO Results of Australian rugby league matches played at the weekend. Played Sunday: Sydney Bulldogs 17 South Queensland 16 Brisbane 38 Gold Coast 10 North Sydney 46 South Sydney 4 Illawarra 42 Penrith 2 St George 20 North Queensland 24 Manly 42 Western Suburbs 12 Played Saturday: Parramatta 14 Sydney Tigers 26 Newcastle 24 Western Reds 20 Played Friday: Canberra 30 Auckland 6 -- Sydney Newsroom 61-2 9373-1800 2849 !GCAT !GPOL CONGO GOVERNMENT LIST (960825) *********************************************************** * 24 Aug 96 - Prime minister Yhombi-Opango presented the * * resignation of his government to the * * president. * *********************************************************** - - - - - - - President (sworn in 31 Aug 92)................ Pascal LISSOUBA - - - - - - - OUTGOING GOVERNMENT: (Formed 23 Jan 95) (SEE NOTE ABOVE) Prime Minister (apptd 23 June 93)........... Jacques Joachim YHOMBI-OPANGO - - - - - - - MINISTERS OF STATE: Administrative & Economic Decentralisation...... . Martin MBERI Interior, Security & Urban Development..................... . Philippe BIKINKITA - - - - - - - MINISTERS: Agriculture, Livestock, Water & Forestry & Fisheries.........................Prosper KOYO Communication & Government Spokeswoman........... . Albertine Lipou MASSALA Culture......................................Gabriel MATSIONA Defence.......................Maurice Stephane BONGHO-NOUARRA Development, Mines & Energy, Post & Telecommunications..............Jean ITADI Economy & Finance....................Nguila MOUNGOUNGA-NKOMBO Education & Scientific Research & Technology.............Martial de Paul IKOUNGA Equipment & Public Works....................Lambert NGALIBALI Foreign affairs.........................Arsene TSATY-MBOUNGOU Health & Social Affairs.......................... Jean MOUYABI Justice, Administrative Reform................ . Joseph OUABARI Labour, Civil Service, Social Security...... Anaclet TSOMAMBET Oil......................................... . Benoit KOUKEBENE Trade, Small & Medium-Sized Businesses...... Marius MOUAMBENGA Transport & Civil Aviation....................Seraphin GOMPET Women's Integration in Development......Marie-Therese AVEMEKA Youth & Sports...............General Claude Emmanuel ETA-ONKA - - - - - - - National Assembly Speaker.......................Andre MILONGO - - - - - - - Central Bank Governor....................Jean-Felix MAMALEPOT (Central bank of Central African States) Central Bank Director.......................... Gabriel BOKILO - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End Government List) 2850 !GCAT !GDIP !GPOL !GVIO Military leader Pierre Buyoya, his country under sanctions following a military coup last month, said on Sunday he had asked mediator Julius Nyerere to set up a regional summit with Burundi taking part. The announcement followed a meeting between Buyoya and former Tanzanian president Nyerere at Musoma, western Tanzania, held in defiance of a ban imposed by regional countries on foreign travel by officials of Buyoya's government. "We have asked that this (a regional summit with Burundi) could take place. Dialogue must continue so that there will be a better understanding of each other," Buyoya said at a news conference in Bujumbura after returning from Musoma. The meeting, which Buyoya said lasted three hours and was initiated by Nyerere, indicates a softening in the attitude of East African leaders towards Buyoya's regime since they imposed sanctions on July 31. East African states including Tanzania, Kenya, Uganda and Rwanda, imposed sanctions on Burundi after the July 25 military coup ousted Hutu president Sylvestre Ntibantunganya. They demanded a return to constitutional government and unconditional talks between all parties including the Tutsi-dominated army and Hutu rebels who are engaged in a vicious civil war. Buyoya also announced a three-year transitional period designed to revive the country's institutions -- an enlarged National Assembly to begin work in September and a national debate on the country's political future to take place in November. Ntibantunganya has remained holed up in the American ambassador's residence in the capital for more than a month, while other senior officials of the banned Fordebu Party have fled the country or taken refuge in foreign embassies. Buyoya said the meeting with Nyerere had brought about a better understanding between the two sides. "Nyerere promised to explain the content of our meeting to other regional heads of state," Buyoya said. But he added that there was no immediate prospect that sanctions would be lifted. The sanctions are hitting Burundi hard. Strict rationing of petrol is already in force and there is a growing shortage of many other imported goods. Around 150,000 people -- mostly civilians -- have died in Burundi since 1993, when the country's first democratically elected Hutu president was killed in an attempted army coup. London-based human rights group Amnesty International last week said 4,050 people had been killed by Burundi's army in the Giheta district of central Gitega region since the coup. The government has dismissed the report outrageous. "You cannot have this number of people killed in so short a time in Burundi without there being a civil outcry," presidential spokesman Jean-Luc Ndizeye said. Senior Burundian military officials have also denied that a major operation was mounted in Giheta district, but soldiers in Giheta this weekend said that operations against Hutu rebels were continuing at Giheta's Bukinga commune. Numerous houses were still smouldering in the area and terrified villagers said their houses had been set ablaze by soldiers conducting sweeps for Hutu rebels. 2851 !C42 !CCAT !E21 !E211 !E41 !ECAT !GCAT !GJOB !GPOL Bodies piled up in mortuaries around Zimbabwe on Sunday after the government dismissed public service workers who went on a weeklong strike for higher wages. President Robert Mugabe said he might use the strike to trim the civil service. The Public Service Commission said on Saturday it had fired thousands of the strikers -- including nurses, junior doctors, mortuary attendants, magistrates, customs officers and firefighters -- for defying an order to return to work. "We don't take kindly to illegal strikes. Already the civil service is too large and this might be an opportunity for us to reduce it," Mugabe told reporters on return from a summit of southern African leaders held in Lesotho at the weekend. The government has been under pressure from international donors backing its economic reforms to slash the civil service which economists say is bloated and accounts for about 40 percent of gross domestic product annually. A Public Service Association official said up to 90 percent of the government's estimated 180,000 workers took part in the strike, a rare challenge to Mugabe and his dominant ZANU-PF party, both in power since independence from Britain in 1980. It has divided senior government officials and MPs who normally rally behind official positions. Some urged the government to negotiate. Others were adamant that it could not afford to give in. Bereaved relatives said at the weekend they had been trying since Tuesday to get documents allowing them to bury their dead. "We are worried that the situation might deteriorate and of course we feel for people who are being denied access to their dead relatives," Godwin Gwisai, superintendent at United Bulawayo hospital in southwestern Zimbabwe, told reporters. The strike has disrupted international and domestic flights and forced many hospitals to handle emergencies only, under supervision from senior doctors aided by army medical personnel and the Red Cross. Asked if his government would reconsider the dismissal order, Mugabe said: "I have to be briefed by the minister (of public service, labour and social welfare, Florence Chitauro)". The workers demand wage rises of between 30 and 60 percent. They say their pay has not kept up with annual inflation of 22 percent, scoffing at eight percent rises awarded recently by the government. They earn Z$1,000 ($100) a month on average. 2852 !GCAT !GDIP !GPOL A group of Africans expelled by France after a police raid on a Paris church returned to Senegal, Mali and Zaire under military escort on Sunday, with some saying they had been separated from family or loved ones. Airport ground staff in the Senegalese capital Dakar dubbed the French plane carrying the more than 50 deportees a "flight of shame", refused to handle it and urged airport workers across the continent to boycott that and similar flights. Political parties and other groups in Mali held a rally in the capital Bamako and passed a motion denouncing France's treatment of the immigrants and what they called an "anti-immigrant crusade" by its conservative government. But reaction from African governments, particularly among France's former colonies in West and Central Africa, to the plight of illegal and other immigrants in Saint-Bernard church in Paris has been mute. "I have been in France for 16 years, I left my French wife there, my father, my mother and even my grandfather. I don't understand what's happening to me," one of 13 Senegalese deportees told reporters, declining to give his name. "The French authorities must understand that we are not criminals but economic refugees. We left our country because life is difficult. That's the reality," he added. More than 50 nationals from Senegal, Mali, Zaire and Gabon were put on an Airbus 310 at a military base west of Paris for the journey home to the world's poorest continent. Only four out of 210 Africans arrested in the church on Friday were on the plane, which left on Saturday evening. Witnesses said a French military supply plane accompanied the Airbus from Dakar to Mali, where 23 people, including four from the church, left the plane which travelled on to Zaire. "It took a lot of skill to persuade the deportees, who did not want to leave the plane, to disembark," Abdoulaye Tapo, Bamako deputy governor, told reporters after going on board. He said there were more soldiers than Africans on the plane. One of the deportees, who were aged 22 to 25 and who all looked exhausted, said he had had to leave his wife and child behind and had no news of them. In France, Prime Minister Alain Juppe sought to soften the crackdown on illegal immigrants with promises of more humanity. Legal appeals continued. Police scrapped expulsion orders against 45 Africans but it was unclear how many of the 210 seized by riot police on Friday in the church, including 10 on day 50 of a hunger strike, were still in detention. West African governments, vocal about the expulsion by Angola this month of illegal migrants from their region, have been mute in their reaction to events at the church. But ground workers in Dakar refused the handle the French plane, delaying it for several hours. "No worker from Air Afrique should take part in this base task by helping these flights of shame on the ground," the Francophone African multinational carrier's union said. No ground staff turned out in Bamako to handle the plane, which also carried 18 Zaireans and two Gabonese. In France, the church raid triggered protests against the centre-right government and clashes between stone-throwing protesters and riot police in Paris on Friday. Outside the military airbase more than 100 people scuffled with police. 2853 !GCAT !GCRIM Thousands of people detained in Nigerian prisons have not been tried and languish there for years before courts and tribunals hear their cases, a leading Nigerian human rights group said on Monday. "Nigerian prisons have a population numbering 65,000 with about 45,000 persons or (some) 65 percent awaiting prosecution in different courts nationwide. And persons have been detained indefinitely without charge and trial on the orders of the military authorities," the Constitutional Rights Project said. Its 55-page report released on Monday in Lagos said that the military government's setting up of tribunals to speed up trials had not worked. "Our statistics show that the use of tribunals has not improved the delays associated with justice in Nigeria. The Miscellaneous Offences Tribunals set up by the government have a backlog of cases dating to 1991," it said. Calling for reform, the CRP said: "The machinery of administration of justice is not moving justly and efficiently. "It has brought extensive delays in the prosecution of criminal suspects, and which has resulted in a logjam of cases in courts and confinement of several thousands of people in prison and police custody for long periods without trial." The CRP said it wrote the report based on research, on-the-spot visits to the courts, prisons and police stations, and interviews nationwide. The aim was to encourage and advocate reforms in institutions responsible for promotion of human rights and democratic norms in Nigeria, it said. It attributed delays in the prosecution system to: "inadequate manpower in the prosecution department, insufficient number of courtrooms and lack of investigation tools by the police." The human rights group said that military government decrees "infringe on fundamental human rights, create tribunals which, oust the jurisdiction of courts, negate due processes, preclude judicial appeals...leading to perversion of justice." Military-ruled Nigeria has been under fire from the local and international communities for human rights abuses and lack of democracy since the annulment of a presidential election in 1993 meant to have restored democracy. The West African nation was suspended from the Commonwealth, the club of Britain and its former colonies, for the hanging last November of author Ken Saro-Wiwa and eight other minority rights activists for murder, despite international pleas for clemency. Critics said their trial by a tribunal was flawed. But Nigeria insists the nine were gulity of the murder and the use of the tribunal was meant to treat such a criminal case with dispatch. Among those detained is businessman Moshood Abiola, presumed winner of the annulled poll, for proclaiming himself president in defiance of the military. In April, a United Nations team, which visited the country at the government's invitation, produced a report that called for a reform of draconian laws but backed the three-year transition plan to civilian rule of military ruler General Sani Abacha. A planned visit by Commonwealth ministers to Abuja on August 29-30 to continue discussions on Nigeria's suspension, collapsed because Nigeria set strict terms that the visit "should not be misconstrued as a Commonwealth fact-finding mission." The CRP suggested a review of the "detention without charge or trial" concept to eliminate delays in the prosecution system. "The number of judicial personnel should be increased, the police should be well-funded and given powers to prosecute suspects within a time limit, failing which suspects should be released on bail," it said. 2854 !GCAT !GPOL Gambia is to issue a new set of bank notes which over time will replace notes bearing the face of Sir Dawda Jawara, the elected president toppled by young military officers in 1994. Portraits including those of a Gambian man, a woman, a boy and a girl, along with birds and assorted scenes would replace Sir Dawda's face on the notes which would be issued from September 5, a central bank statement said. "The most noticeable modification to the design is the replacement of the portrait of the former head of state with generic images or portraits," the statement said. The existing notes would remain legal tender while being phased out over the next two years, it said. The new notes, with a face value of five, 10, 25 and 50 dalasis, would be of the same size, colour and general appearance as the old notes but would include additional security features, the statement said. Military leader Yahya Jammeh plans to contest a presidential election in the West African nation on September 26. Anyone who served as a minister under Sir Dawda has been banned from standing. ($1 = 9.9 dalasis) 2855 !GCAT !GVIO Houses smouldered in villages this weekend near the Gitega region of central Burundi, where a human rights group said 4,050 people had been killed by Burundian soldiers since a July 25 coup. Terrified villagers said their houses had been set ablaze by soldiers conducting sweeps for Hutu rebels. Senior Burundian army officials in the capital, Bujumbura, 80 km (50 miles) west of Gitega town, have poured scorn on the report by London-based Amnesty International and denied that a big military operation took place in the region after the coup. But frightened villagers at the weekend fled into surrounding fields at the approach of a passing vehicle. "We fled because we thought it was the soldiers who were coming. When they come they immediately start shooting at us," one Hutu peasant farmer, who asked not to be named, told Reuters. "There are no assailants (rebels) here, but they do live nearby and they are armed," another farmer at Kitongo commune said. Bukinga commune in nearby Giheta district was an active "combat zone" on Saturday, with a military operation to clear Hutu rebels still in progress, soldiers told Reuters. Amnesty International said on Thursday that 4,050 unarmed civilians were killed by Burundi's Tutsi-dominated army between July 27 and August 10 in Giheta district after the army came to obtain information about rebel movements. "This pattern is being repeated in other parts of the country," the report said. A spokesman for military strongman president Pierre Buyoya called the Amnesty report "outrageous". "Amnesty International is either completely misguided or is falling into propaganda," spokesman Jean-Luc Ndizeye told Reuters. About 150,000 people have been killed in Burundi since October 1993, when the country's first democratically elected Hutu president was assassinated in an attempted army coup. Burundi shares the same ethnic make-up as its northern neighbour Rwanda where an estimated one million people were massacred in 1994 -- a Tutsi minority, for centuries the feudal rulers, and a Hutu majority. Buyoya on Sunday flew to western Tanzania for a meeting with former Tanzanian president Julius Nyerere, according to a Buyoya aide. Nyerere is the international chief mediator on Burundi and the driving force behind East African sanctions designed to restore constitutional rule to the country. The aide gave no further details of the meeting. 2856 !GCAT !GDIP !GPOL !GVIO Burundi's President Pierre Buyoya, his country under sanctions following a military coup last month, flew on Sunday to Tanzania to meet former president Julius Nyerere, presidential officials said in Bujumbura. Nyerere is playing a leading role in mediation between Buyoya and other African leaders. The meeting was taking place at Butiama, Nyerere's home in western Tanzania, Buyoya's aides said. They gave no further details, but said Buyoya was expected to return to Bujumbura later on Sunday. Buyoya's meeting with Nyerere was the latest in a series of high-level contacts with leaders in Tanzania and Uganda since the East African states imposed sanctions on trade and communications with Burundi after the July 25 coup there. East African ministers meeting in Kampala, the Ugandan capital, this month agreed to ban travel to and from Burundi by members of the Buyoya government. Despite this declaration, there have been several high-level meetings between Buyoya ministers and representatives of other African governments, with Burundi apparently seeking a softening of the trade sanctions. The sanctions are hitting Burundi hard. Strict rationing of petrol is already in force and there is a growing shortage of many other imported goods. Burundi has no local oil supplies, and normally imports petrol througth Tanzania's Indian Ocean port, Dar es Salaam. Goods are normally carried by rail across Tanzania to the Lake Tanganyika port of Kigoma, and from there by ship to Bujumbura. But the movement of ships from Kigoma to Bujumbura has halted, and Tanzania and Zaire recently agreed to step up efforts to stop the smuggling of goods to Burundi in small boats on Lake Tanganyika. 2857 !GCAT !GCRIM !GVIO A South African court passes judgment from Monday on an old-guard policeman who says he was apartheid's most effective killer. Eugene de Kock, who commanded a ruthless hit-squad unit and squealed on his former operatives this year to save his own skin, faces 121 charges from murder to arms offences arising from three decades of trying to uphold white supremacy. A counter-insurgency colonel who also had a hand in doomed white fights to cling to power across southern Africa, de Kock, 48, will be the highest-ranking apartheid security official to hear a judge pronounce his fate. His trial began shortly after President Nelson Mandela's election in April 1994 and revealed the depth of the ousted government's dirty tactics against its black opponents. "It's a trial worthy of the very best crime or espionage novel, reminiscent of Rasputin, Idi Amin and all other horrors society can dredge up," South Africa's Star newspaper said. "For two years it has provided a litany of death and mayhem which formed part of the South Africa of yesteryear." The accusations included massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police. Even de Kock's own defence lawyers conceded last week that he would be found guilty of at least some of the 10 murders -- including those of two colleagues -- of which he is accused. The judge in Pretoria's Supreme Court is expected to spend much of the week announcing the verdicts. Asked by lawyers at another trial where he gave evidence if he agreed he was the security forces' "most effective assassin", de Kock answered: "Yes, I would say that would be correct." That testimony helped convict three former colleagues in June of a bloody 1989 car-bombing and won him indemnity in return in the case, but looks unlikely to help him in his own trial. He has now applied to Archbishop Desmond Tutu's Truth and Reconciliation Commission for the amnesty it has the power to grant to those who committed human rights abuses but came clean. Some police commanders who worked with de Kock have applied for amnesty too and could escape trial altogether. A policeman for 27 years, de Kock left South Africa in the 1960s to fight black liberation guerrillas in white-led Rhodesia, now Zimbabwe. Back home, he formed a security police unit that tried to thwart the South West African Peoples' Organisation (SWAPO) in its fight for Namibian independence from South Africa. In 1980 he joined the now notorius Vlakplaas unit, based on a farm near Pretoria, where senior officers plotted the dirty tricks aimed at killing and discrediting enemies of white rule and sowing division among them. On his arrest in early 1994 he possessed eight passports and millions of rands stashed in offshore banks. Before de Kock became commander, the unit was led by Dirk Coetzee, who later exposed the government's "third force" death squads and joined Mandela's African National Congress. Coetzee, who faces trial in December despite his amnesty application, has survived at least two attempts on his life -- one of which de Kock is accused of planning. Former defence minister Magnus Malan, accused of authorising a hit squad that killed 13 people, is the most senior apartheid figure to stand trial to date. His case continues. 2858 !GCAT !GDIP Drawn by glossy images of life in the West, tens of thousands of Africans leave the world's poorest continent every year dreaming of starting a new and better life abroad. The impact or the scale of the exodus may not match that of the boat people from Vietnam or Haiti -- it's more of a steady trickle than a spectacular torrent. But France's latest expulsion of illegal immigrants after a raid on a Paris church where they had taken refuge has again highlighted the dilemma faced by host and home governments alike in dealing with the problem of poverty. "The French authorities must understand that we are not criminals but economic refugees. We left our country because life is difficult. That's the reality," commented one of 13 Senegalese flown home on a French military charter. The deportee, who declined to give his name, said that he had had to leave a wife and family back in France, where he had lived for 16 years. African migrants target former colonial powers such as France, Britain, Spain or Portugal. Host countries say they are happy to take political refugees fleeing in fear of their lives. Economic refugees, they say, must make the best they can of life at home. Economic migrants reply that that is easier said than done. Life expectancy in many West Africa nations, where disease, drought or floods take their toll, rarely extends beyond the late 50s. World Bank figures give 49 for Mali, 40 for Sierra Leone, 38 for Guinea Bissau, the world's lowest. Things have since shown signs of improvement but per capita income in 1994 was just $160 in Sierra Leone. Elsewhere in Africa it was even lower -- $80 in Rwanda or $90 in Mozambique. In Ivory Coast, one of the wealthier countries, it was $610 compared to well over $20,000 in France and the United States. In many parts of Africa, as across poorer parts of Asia, whole families survive thanks to money sent home by children who have travelled abroad in search of work. "Once in France, they (Malian immigrants) set up associations through which they organise collections which they use to make admirable socio-economic contributions to their home regions," Moussa Coulibaly, deputy head of a migrants' support group, told French radio in Mali on Sunday. The exodus takes many forms. Some Africans, well-qualified and often educated abroad, take jobs in Europe or the United States with proper papers and residence permits. Others travel abroad to study legally, initially at least. Others, often the poorest, stow away on ships and planes or find other illegal ways to enter their country of choice. The lucky ones arrive alive -- stowaways sometimes die on the journey. Without proper papers, they pound the streets selling African trinkets, playing cat-and-mouse with police. Some work anonymously or clandestinely as maids or labourers, prey to abuse or exploitation. Some find happiness and a new life -- often marrying a national in the host country. But for those who sneaked in illegally, the threat of expulsion is ever present. Western governments have tightened immigration laws and thrown their weight behind efforts to revive Africa's struggling economies, partly as a way of discouraging emigration. Working with the World Bank and the International Monetary Fund, they preach economic liberalisation, forgive debt and provide a range of economic aid. African countries, particularly France's former colonies in West or Central Africa, have had little to say about events at the Roman Catholic church of Saint-Bernard in Paris. All are trying to revive their economies. France has made itself their spokesman at the tables of the rich, securing debt forgiveness and other benefits. Some, like Ivory Coast, Gabon or South Africa, have become a magnet for immigration from poorer African neighbours. Oil-rich Gabon and South Africa have both expelled illegal migrants. Mali's ruling ADEMA party called in a statement last week for dialogue and solutions "which respect both the rights of the host nations and humanitarian rights". "It is time (for Africans) to think of economic independence," Ivory Coast's government daily Fraternite Matin said in a commentary on Saturday. 2859 !GCAT !GDIS !GHEA Cholera has killed 46 people living in populous suburbs on the outskirts of Mauritania's capital Nouakchott, medical sources said on Sunday. Diplomats said at least 20 people had been killed in the outbreak, which followed the heaviest rain in the capital for three years. Medical sources said most of the dead were children or elderly people. 2860 !GCAT !GVIO Christian fundamentalist rebels fighting to overthrow Ugandan President Yoweri Museveni abducted 50 girl students in a raid on a school in northern Uganda, the state-owned Sunday Vision newspaper reported. Quoting army sources, it said the students were abducted by the Lord's Resistance Army (LRA) on Thursday night at Bungatira outside Gulu, the provincial capital 345 km (215 miles) north of Kampala. The rebels, who have fought a guerrilla war since 1987 saying they want to rule Uganda according to the Bible's Ten Commandments, had earlier battled government forces outside Gulu. Two rebels were killed, the paper said. The abduction followed reports that about 150 LRA rebels led by Joseph Kony crossed into Sudan earlier last week with about 300 people abducted from villages outside Gulu. The rebels entered Uganda from bases in Sudan on July 8, according to army reports last month. They killed 108 Sudanese refugees at a camp near Kitgum east of Gulu later in July and then moved towards Gulu, killing more than 500 people in raids on villages, army and police positions, and in landmine attacks. The insurgency by the LRA has disrupted life in northern Uganda, with a population of nearly four million. Schools, hospitals, and government offices outside Gulu have closed, politicians from the area say. Up to 180,000 civilians are huddled in Gulu after fleeing villages in fear of LRA attacks, reporters in the town said. Gulu is heavily guarded by the Uganda People's Defence Forces (UPDF). In raids earlier this month, rebels hit targets barely two km (one mile) from the main military barracks. 2861 !GCAT !GDIP !GVIO A South African Sunday newspaper said the old apartheid regime shipped chemicals and chemical weapons technology to Iran, and that the disclosure could damage relations with the United States. "Iran and possibly Iraq received chemical shipments from South Africa," the Sunday Independent said, quoting "a source who was privy to discussions about the exports". "Key personnel in the South African Defence Force's chemical weapons programme were confirmed visitors to Libya," it added. "These are some of the embarrassing facts Gen Georg Meiring, the S.A. National Defence Force chief, was hoping to keep from the public eye...at a parliamentary committee inquiry this week." Meiring balked again on Wednesday at revealing full details of a controversial project to make chemical weapons during the last days of apartheid. Despite intense pressure at parliament's public accounts committee, he and his top staff insisted that making public key details of "Project B" would be a "serious breach of security". But what they did reveal depicted a trail of intrigue and deception involving a foreign agent who disappeared with $1.6 million in state funds and the sale of state assets worth at least 50 million rand ($11 million) for 350,000 rand ($77,000). Although Meiring refused to name the foreign agent or say where he was, documents before the committee said the Office of Serious Economic Offences was investigating the deposit of the $1.6 million "into an account in Croatia". Meiring said the agent had been used to buy "very sensitive chemicals" from an Eastern European country for Project B, which was aimed at developing chemical and biological weapons. But the deal went sour and the agent disappeared with the money. ($=4.53 rand) 2862 !C33 !C331 !CCAT !GCAT !GDEF South Africa's state-owned arms manufacturer Denel is hoping to clinch its biggest deals to date with sales to Malaysia, Saudi Arabia and the United Arab Emirates, the Sunday Independent newspaper said. Denel managing director Johan Alberts told the Johannesburg weekly his corporation was on the verge of concluding the South African defence industry's biggest series of export deals, worth 36 billion rand ($7.95 billion), in the Middle East and Asia. He declined to say where but the newspaper, which gave no source, said Malaysia was believed to be interested in becoming the first foreign country to buy Rooivalk attack helicopters. Saudi Arabia and the UAE were other potential customers, it said. Alberts said new deals could create 15,000 new jobs. Denel is on South Africa's privatisation list but is not expected to be sold until the middle of next year at the very earliest. In the year to the end of March it raised its net profit to 379 million rand from 310 million the year before. ($1=4.53 rand) 2863 !GCAT !GCRIM !GDIP A first group of Africans expelled by France after a police raid on a Paris church landed in Senegal and Mali overnight. Airport staff dubbed a French plane carrying them a "flight of shame" and refused to handle it. More than 50 illegal immigrants from Senegal, Mali, Zaire and Gabon were put onto an Airbus 310 at a French military base for the journey home to the world's poorest continent after a long-running standoff at the Saint-Bernard church. On arrival, those who left the plane in Dakar remarked bitterly that they had fled poverty at home and had been forced to leave behind a new life and loved ones in France but official African reaction to the crisis has been muted. "I have been in France for 16 years, I left my French wife there, my father, my mother and even my grandfather. I don't understand what's happening to me," one of 13 Senegalese deportees told reporters, declining to give his name. "The French authorities must understand that we are not criminals but economic refugees. We left our country because life is difficult. That's the reality," he added. In France, Prime Minister Alain Juppe sought to soften the crackdown on illegal immigrants with promises of more humanity. Only four Africans out of 210 arrested in the church on Friday morning were deported on the charter plane with more than 50 other illegal immigrants bound for Mali, Senegal and Zaire on Saturday evening from a military airbase west of Paris. Witnesses said a French military supply plane accompanied the Airbus to Mali, where 23 people, including the four from the church, disembarked. The plane was due to leave for Zaire. Dozens of other immigrants, including 10 on the 50th day of a hunger strike when riot police smashed doors and windows to break into the church with batons and teargas, were in detention in France on Sunday. All children and most women were freed. The Interior Ministry said 40 of those seized in the church would be granted residence permits "due to family or health situations". The Africans had demanded residence rights for all. Defence lawyers said they would continue arguments in court on Sunday aimed at averting threatened new deportations. West African governments, vocal about the expulsion by Angola this month of illegal migrants from their region, have been muted in their reaction to events at the Paris church. But ground workers in Dakar refused the handle the French plane. "No worker from Air Afrique should take part in this base task by helping these flights of shame on the ground," the Francophone African multinational carrier's union said. It urged ground staff in fellow African countries to boycott all such deportation flights from former colonial power France. From Dakar, the plane, which also carried 18 Zaireans and two Gabonese, later landed in Mali, where once again there were no airport staff on hand to service the plane. Political parties in Mali, where torrential rain fell on Sunday, planned a protest rally. In France, the church raid triggered protests against the centre-right government and clashes between stone-throwing protesters and riot police in Paris on Friday. Outside Evreux military airbase more than 100 people scuffled with police. One civilian, hurt in a police charge, was taken away by ambulance. 2864 !E51 !E512 !ECAT !GCAT !GDIP Nigeria risks the imposition of further sanctions by Commonwealth countries after imposing restrictions on a planned ministerial visit, causing its cancellation, diplomats said on Sunday. Commonwealth ministers concerned about human rights had planned to visit the capital Abuja on August 29-30, but only if they could talk to private groups and individuals as well as government officials. "It is undoutedly a big setback, it seemed as though we were really getting somewhere and now it has been thrown back in our faces," one Commonwealth diplomat said in Lagos. "We are back where we came from, it is annoying and it's now the turn of the Nigerians to show a more realistic attitude." Commonwealth ministers will meet in London on Wednesday to consider new action. Some countries, including Canada, want tough measures to be taken. "A lot of members were counting on this (mission) being a great breakthrough. It doesn't look like it's going to be that way," Canadian Foreign Minister Lloyd Axworthy said. "So it may be that we'll have to now consider collective action." Officials have not said what action, if any, might be taken. In April a Commonwealth Ministerial Action Group (CMAG) recommended a series of sanctions, including a ban on arms exports to Nigeria and a ban on sporting links. But Nigeria's timely release of eight political prisoners and fresh promises to implement a return to civilian rule by 1998 defused the issue in June. Both the United States and European Union are also considering sanctions. But all threats have fallen short of an embargo on oil sales, the one measure that would really hurt OPEC member Nigeria. Nigeria was suspended from the group of Britain and its former colonies last November after the execution of author Ken-Saro Wiwa and eight other minority rights activists for murder, in defiance of international pleas for clemency. In the aftermath of Saro-Wiwa's hanging the Commonwealth, followed by the European Union and United States, imposed limited sanctions, including a ban on visas for government ministers and their families, the suspension of assistance programmes and the severing of military assistance. This month Nigeria invited CMAG to visit the capital Abuja for two days to continue discussions begun in London in June on the suspension. Then the foreign ministry spelled out strict terms for the visit: "That it should not be misconstrued as a Commonwealth fact-finding mission." Nigeria says there is no need for a fact-finding mission after a U.N. team, which visited in April at the government's invitation, produced a report that called for reform of draconian laws but backed the transition programme of military ruler General Sani Abacha. "I know there is pride, that Nigeria felt it was badly treated in being suspended, but some Commonwealth countries had done a lot to give Nigeria a chance. I can't think why they would shoot themselves in the foot," an African diplomat said. "We still want the Commonwealth to come, but only if they can meet us. Otherwise it would just be a farce," said Olawale Fapohunda of the Civil Liberties Organisation pressure group. 2865 !GCAT These are significant stories in the Nigerian press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. SUNDAY TIMES - Robbers terrorise Lagos homes. - Oil companies plan meeting over new operational directives announced last week by oil minister Dan Etete. - Banking sector regulator Nigeria Deposit Insurance Corporation cautions external auditors, who are accused of contributing to distress in banking sector. THE GUARDIAN ON SUNDAY - Major businesses consider operating only in Lagos following their accusation that double taxes are levied against them in other Nigerian states. - Newly appointed military governor of Lagos state shocked at condition of crumbling roads. SUNDAY CONCORD - Tyre makers Dunlop Nigeria record booming sales due to a restructuring of the company, chief executive Dayo Lawuyi says. - Twenty-seven men aged 60 and over await execution in eastern Enugu prison. --Lagos newsroom +234 1 2630317 2866 !C42 !CCAT !E41 !ECAT !GCAT !GCRIM !GJOB Zimbabwean police have freed two leaders of an unprecedented strike by civil servants whom they arrested at the weekend for inciting the work stoppage, a Public Service Association (PSA) official said on Sunday. He said PSA executive secretary John Makoni and his deputy Charles Chivuru were released on condition they stayed away from the strikers. "We understand the two are out now on condition they do not meet with the people who are on strike," said the PSA official who refused to be named. The government said on Saturday it had fired the workers -- who included nurses, junior doctors, mortuary attendants, customs officials and firefighters -- for defying an order to stop the weeklong strike which has partially paralysed key social services and disrupted international and internal flights. 2867 !GCAT !GCRIM !GDIP A first group of Africans expelled from France after a police raid on a Paris church arrived home in Senegal and Mali overnight, but airport staff refused to service the plane carrying them. More than 50 illegal immigrants from Senegal, Mali, Zaire and Gabon were put onto an Airbus 310 in Paris for the journey home to the world's poorest continent after a long-running standoff at the Saint-Bernard church. On arrival, those who left the plane in Dakar remarked bitterly that they had fled poverty at home and had been forced to leave behind a new life and loved ones in France. "I have been in France for 16 years, I left my French wife there, my father, my mother and even my grandfather. I don't understand what's happening to me," one of 13 Senegalese deportees told reporters, declining to give his name. "The French authorities must understand that we are not criminals but economic refugees. We left our country because life is difficult. That's the reality," he added. Back in Paris, Prime Minister Alain Juppe struggled to reconcile a crackdown on illegal immigrants with pledges of greater humanity. Only four Africans out of 210 arrested in the church on Friday morning were deported on the charter plane with more than 50 other illegal immigrants bound for Mali, Senegal and Zaire on Saturday evening from a military airbase west of Paris. A French military supply plane accompanied the Airbus. Several dozen other immigrants, including 10 on the 50th day of a hunger strike when riot police smashed doors and windows to break into the church with batons and teargas, were still in detention on Sunday. All children and most women were freed. Defence lawyers said they would continue arguments in court on Sunday aimed at averting threatened new deportations. The Interior Ministry said 40 of those seized in the church would be granted residence permits "due to family or health situations". The Africans had demanded residence rights for all. From Dakar, the plane, which also carried 24 Malians, 18 Zaireans and two Gabonese, later landed in Mali, where once again there were no airport staff on hand to service the plane. Political parties in Mali, where torrential rain fell on Sunday morning, planned a protest rally. In France, the church raid triggered protests against the centre-right government and clashes between stone-throwing protesters and riot police in Paris on Friday night. Outside Evreux military airbase more than 100 people scuffled with police. One civilian, hurt in a police charge, was taken away by ambulance. Officials at Juppe's office said the conservative prime minister was willing to soften implementation of tough 1993 immigration laws, long denounced by the left-wing opposition, human rights activists and immigrants as unworkable. They said Juppe, meeting President Jacques Chirac in the president's Riviera retreat for a weekend of talks, wanted to make the laws more "efficient" and more "humane". 2868 !GCAT !GPOL !GVIO South Africa's truth commission begins issuing subpoenas this week in a bid to dig beneath the political rationales and find the sinister figures who have the blood of the country's race war on their hands. Leaders of the major parties involved, from right-wing whites to radical blacks, appeared before Archbishop Desmond Tutu's Truth and Reconciliation Commission last week to paint the broad picture of their actions for or against apartheid. Most, including former president F.W. de Klerk and African National Congress Deputy President Thabo Mbeki, offered apologies for any mistakes they had made and accepted broad responsibility for the actions of their foot soldiers. But none named those guilty of ordering or carrying out any of the gross violations of human rights which Tutu is investigating. Human rights lawyer Brian Currin said the hearings last week were not intended as a form of confessional and that those who personally committed crimes during apartheid would testify only before a separate arm of the commission, the amnesty committee. "I don't think one should have expected more than what one got," he said. "That was not the amnesty committee where perpetrators are expected to open their hearts and souls and to tell it all." The commission, which has the power to grant amnesty to those who confess to abuses, has begun hearing the testimony from people already in jail for their deeds. But others, such as self-confessed secret police hit-squad leader Dirk Coetzee, have yet to testify. Tutu's deputy chairman, Alex Boraine, told reporters the commission would begin issuing subpoenas to suspects who refused to appear voluntarily some time this week. He added that former hardline apartheid president P.W. Botha could be among those called. But Currin, who is advising several people regarded as perpetrators, said this was not the best way to achieve the commission's aims. "A person can be forced to appear, but the only way one is going to get to the truth in its totality is if people feel it is a good idea to go to the amnesty committee. At the moment this is not the case." He cited Coetzee, who was charged with murder after confessing in media interviews to dirty tricks. His trial is due to start in December but the truth commission intends to decide on his amnesty application before that. Currin said the law had to be changed so all judicial prosecutions were automatically suspended for those who approached the truth commission. Last week's submissions to the commission by the ANC, de Klerk's National Party and the right-wing Freedom Front of General Constand Viljoen left many South Africans unsatisfied. Boraine said the picture was incomplete because officers of the apartheid-era security forces had yet to make their scheduled, separate submission, but one black caller to a radio talk show declared: "This whole thing is utterly useless, it doesn't help us at all. What the people expect is to have houses, to have jobs." Political scientist Jannie Gagiano said he doubted that the National Party, which implemented apartheid in 1948 and began dismantling it in 1990, felt it carried a burden of guilt and needed to be exculpated through the commission. "Therefore I have some doubts about achieving some form of reconciliation. One has to feel a bit guilty to feel the need for reconciling yourself to a historical adversary," he said. Professor Tom Lodge of the University of the Witwatersrand demurred, saying: "In the irritation, in the jokes, in the anger that white South Africans express about the commission, I think there's a moral uneasiness, and I think that's healthy. Responsibility is percolating downwards." 2869 !GCAT !GDIP Southern African states put the faith of one of the world's poorest regions in the hands of Nelson Mandela at the weekend by naming the South African president their titular head. Heads of state of the 12-member Southern African Development Community (SADC) on Saturday elected the South African president as the regional body's chairman for the next three years. "With humility I hand over the mantle of leadership of our region to my dear and trusted friend, president Mandela," outgoing SADC chairman and Botswana president Ketumile Masire told delegates to the annual SADC summit. SADC -- formed 16 years ago to lessen the region's dependence on then apartheid South Africa -- groups Namibia, Lesotho, Swaziland, Botswana, Malawi, Mozambique, Angola, Tanzania, Zambia, Zimbabwe, Mauritius and South Africa. The World Bank ranks Mozambique and Malawi among the poorest countries in the world while many of the region's inhabitants live in impoverished villages and squatter settlements. South Africa only joined SADC officially in 1994 after the country's historic all-race elections swept Mandela's African National Congress to power, although the ANC was given observer status at SADC summits during its fight against apartheid. Mandela, wearing one of his trademark colourful shirts, told hundreds of delegates in the Lesotho capital Maseru that it was an honour for South Africa to steer the region during his term. "It is a great honour to the people of South Africa and to me personally. "The offer comes at a time when South Africa requires this gesture from countries of the region because it will strengthen the efforts of South Africans to entrench democratic values in our country," Mandela said. Delegates said Mandela's status as an international statesman and his country's economic might made the SADC decision a logical one. Critics have accused the regional grouping of being little more than a expensive talkshop but delegates said this view could change with Pretoria at the helm. South Africa's economy dwarfs those of the rest of SADC. Mandela said he would have preferred a more experienced politician to lead SADC and jokingly told delegates: "I thought he (Masire) was handing over to me the presidency of Botswana". Delegates said even with Pretoria at SADC's helm, its trade policies have put relations with neigbours under strain. Zambian President Frederick Chiluba, pushing for similar treatment on trade as Zimbabwe, threatened South Africa with retaliatory trade measures last week. Zimbabwe and South Africa ended a four-year trade dispute this month when Mandela's government agreed to cut some tariffs on Zimbabwean goods. The SADC leaders signed a series of protocols during the summit, one of them on trade aimed at eventually establishing a regional free trade area. The protocol, still to be ratified and expected to be fully operational in eight to 10 years' time, provides for the liberalisation of trade in the region and the phased and eventual elimination of import duties. "It is a major breakthrough. Basically now, SADC is talking about some extremely important and serious economic issues," South African Trade and Industry Minister Alec Erwin told reporters. 2870 !GCAT !GDIP South African President Nelson Mandela has a guest to lunch on Monday that few world statesmen would dare to host - Taiwan's Vice Premier Hsu Li-teh. Their meeting, at the start of a nine-day visit by Hsu, is a sign of diplomatic support that should cheer Taiwan's isolated leaders after a rocky few weeks in a long fight with Beijing for recognition as the real China. They lost one of only 31 allies when Niger dumped them for Beijing. Then, countries seeking ties with both -- like South Africa -- saw in Beijing's wrath, after Ukraine secretly hosted Taiwan's Vice President Lien Chan, how unrealistic that is. Mandela, 78, has found himself as Taiwan's weightiest diplomatic ally, by a quirk of history through apartheid South Africa's closeness to a fellow international outcast. His government indicated earlier this year it was mulling a rethink that could mean switching ties to Beijing, which refuses relations with any country recognising its tiny rival Taiwan. But Mandela said last month it would be immoral to dump Taipei, so relations look set to stay for now. "The status quo remains at this stage but South Africa has expressed its wish to have ties with Beijing," Foreign Ministry spokesman Enrico Kemp said. "They say we have to break off ties with Taipei first. South Africa is not at this stage prepared to do that. It's a bit of a stalemate at this stage." The People's Republic of China insists that states seeking formal ties with it must first sever relations with what it sees as a renegade Republic of China government, which took refuge on the island after losing a civil war to the communists in 1949. South Africa still says it would like relations with "both Chinas" and says Hsu's visit should be seen "in the context of our express desire to improve and extend relations with the greater China region". Kemp said Pretoria had received no complaints from Beijing about the visit on which Hsu will also meet Foreign Minister Alfred Nzo and Mandela's deputy and heir apparent, Thabo Mbeki. It is the highest-level working visit by a Taiwanese leader since all-race elections in April 1994 ended white minority rule, though President Lee Teng-hui attended Mandela's inauguration. A business delegation will come with Hsu. "This visit will certainly further our business and trade relations, and bolster relations in general," Taiwanese embassy spokesman Charles Chen said. Taiwan described relations with South Africa last week as solid and stable and over their worst patch when Nzo visited Beijing in March. He has since visited Taipei too. South African trade ties with China have soared in recent years, fuelling pressure for formal recognition. But Taiwan has far greater investments in the country and has promised more. Last week Taipei and Beijing both called for a resumption of talks broken off more than a year ago, but China's anger at Taiwan's mission to Ukraine, at which it tried to improve unofficial relations, cooled hopes for any breakthrough. 2871 !GCAT !GDIS !GENV Ethiopia's Awash river has flooded a town southeast of Addis Ababa, forcing the evacuation of 20,000 people, Ethiopian radio reported on Saturday night. The radio said the river, swollen with water released from the Koka dam, a large hydro-electric installation, burst through three dykes to flood a large area including Wanji town. About 20,000 people -- 90 percent of the population of Wanji -- were evacuated, while others fled and sought shelter on a nearby hill. The radio said soldiers were trying to rescue those left in the town, and one body had already been recovered. Reports from the area on Friday said the river had burst its banks and flooded more than 2,000 hectares (4,942 acres) of cane fields and workers' homes on a large sugar plantation. The state-run Ethiopian News Agency said thousands of plantation workers' homes were flooded in the area about 100 km (62 miles) east of Addis Ababa and the workers were moved to the nearby town of Nazareth. Water Resources Minister Shiferaw Jarso said the flooding followed the release of 300 cubic metres of water per second into the river from nearby Koka Dam. A decision had been taken to release flood waters which had piled up to a dangerous level behind the dam, threatening to destroy the dam, he said. Shiferaw warned residents of the area to move to emergency shelters prepared by the government. Ethiopian authorities said shelters stocked with food, blankets and medicine for up to 150,000 in the area were ready. 2872 !GCAT !GPOL !GVIO Russian security supremo Alexander Lebed suddenly suspended talks with Chechen rebels on Sunday and returned to Moscow for further consultations on a deal to end the 20-month old conflict. The talks, due to take place in the village of Novye Atagi with Chechen chief-of-staff Aslan Maskhadov, were delayed amid charges by the Russian military that Chechen rebels had violated a ceasefire agreement by seizing arms from Russian troops. But Lebed, who hoped to return shortly to Chechnya, said the delay was caused by his need for legal advice and the authority of the Russian leadership before he could sign a political deal tackling the tricky issue of the future status of the region. "The Chechen side reacts to this with understanding," a rebel spokesman told Interfax news agency, saying the ceasefire agreed last week continued to hold with only a few exceptions. Russian troops began pulling out from southern Chechnya on Sunday under the ceasefire agreement made on Thursday by Lebed and Maskhadov after some of the worst fighting in over a year. But in the capital Grozny, the commander of Russian Interior Ministry forces in Chechnya, General Anatoly Shkirko, told Interfax news agency he was delaying a pullout of troops there because of the seizure of weapons from an armoured column. Lebed told reporters before leaving for Moscow from the Russian base of Khankala near Grozny that he would discuss suggestions put forward by the rebels on Saturday with President Boris Yeltsin and Prime Minister Viktor Chernomyrdin. "I hope that the president will approve of my activities. I will return to the Chechen republic to continue the negotiations with documents, impeccable from the legal point of view, in my hands," he said. Echoing Chechen fears of a mysterious "party of war" in Moscow that is out to thwart him, Lebed added: "There are many people in Moscow waiting for me to sign a document they can turn down and so wreck the peace process." Chechen rebel spokesman Movladi Udugov, speaking in Novye Atagi, 20 km (12 miles) south of Grozny, said Lebed agreed the issue of Chechnya's status would be resolved by a referendum. But it was not clear when it would take place or whether Lebed had, in fact, agreed to this. Russia's constitution would have to be altered to change Chechnya's status. "The question of status has been talked over a long time ago. It's a question of the principle of putting off the solution of the question," Udugov said. "The issue of status will be decided in a referendum, by the free will of the Chechen people," he added. Russian Prime Minister Viktor Chernomyrdin gave few clues to the nature of the deal in an interview recorded on Saturday and broadcast on Sunday. He told Russian Television that Lebed's proposals had been fully approved by the leadership in Moscow but did not make clear if they included a referendum on independence. Chechnya was part of Russia, Chernomyrdin insisted. But he added that "the people" would determine how to settle the conflict -- though only after the enormous work of restoring order in the region was complete. Lebed was earlier quoted by Itar-Tass news agency as saying that suggestions put forward by the separatists during talks on Saturday needed to be looked at by experts in international law. He did not give any details, the agency added. Lebed and Maskhadov have both said a compromise can be found between the rebels' demand for independence and Moscow's insistence the region remains within the Russian Federation. Sunday's meeting between Lebed and Maskhadov faced a last-minute hitch after the Russian military accused the rebels of seizing and disarming a Russian interior ministry armoured column in the Chechen capital, Grozny. The commander of Russian forces in Chechnya, Vyacheslav Tikhomirov, also later cancelled a meeting with Maskhadov, where the two men were due to sign the formal agreement on the ceasefire terms, Interfax said. He said he would not meet Maskhadov until all the weapons were returned. Interfax later quoted the rebel command as saying renegade Chechens had been responsible. They had been brought into line and the weapons would be handed over. "The Chechen side apologised officially to the Russian side and expressed the hope that provocations will not become a reason for the negotiations to be suspended," Udugov said. He was later quoted as saying Tikhomirov and Maskhadov talked the matter over in a radio conversation and would now meet at noon (0800 GMT) on Monday in Novye Atagi. 2873 !GCAT !GPOL !GVIO !GVOTE Thousands of Moslem refugees denounced Bosnia's elections as a farce on Sunday because Serb incomers would be able to vote in their old home town, cementing partition of the country. They said they were ready to force their way back across post-war ethnic lines to Serb-held Doboj, one of several towns where NATO troops fear violence involving refugees determined to vote where they once lived. The refugees, rallying in Matuzici on government territory two km from Doboj in northeast Bosnia, waved banners calling the polls a farce staged by the United Nations and the European Union. "We demand to vote in Doboj," other banners said. Bosnia's Moslem-led central government and many displaced Moslems are angered by a key provision of the Western-organised September 14 elections allowing people to vote in post-war "new places of residence." As a result, separatist Serb authorities have packed former Moslem majority towns with refugees of their own or registered other Serbs to vote there. Critics say that what was billed as an electoral process to reintegrate Bosnia as a single, multi-ethnic state is shaping up as a referendum on partition, de facto or de jure. "Only our physical presence in Doboj will mean that the Dayton peace treaty has truly been implemented," Edhem Efendija Camdzic, Doboj's Islamic imam-in-exile, told the refugees. "The main point of this rally is to highlight to the world powers what misfortune they brought upon us," said Reuf Mehemdagic, head of Doboj municipality-in-exile. "Eleven thousand Serbs who came from elsewhere to Doboj will vote there. How can we then expect the reintegration of Bosnia? But no one will stop us from returning to our homes." Mirhunisa Komarica, a government refugee official, said: "We want to vote where we were thrown out from. This is a protest of warning and the next step is entering our town using all means possible, so let them shoot." Bosnian Vice President Ejup Ganic, a Moslem, told the refugees: "We have a message for the Serbs who are now in our homes not to plan the future of their children there because there will be no good fortune in that." To loud applause, he added: "We will enter Doboj, untie the Doboj knot and ensure free movement for all. We have to enter Doboj to free the Serbs from their own (separatist) politics." The Dayton peace accords guaranteed refugees the right to return to their homes and ensured freedom of movement across ethnic lines. But local police, controlled by nationalist parties in Moslem, Serb and Croat sectors of Bosnia, and civilian mobs have turned ceasefire lines into virtually impassable borders. The majority of refugees from Bosnia's 1992-95 war are Moslems from the Serb-controlled north and east. NATO-led peace troops beefed up their presence in the Doboj area on Sunday to deter any sudden emotional attempt by the refugees to cross the Inter-Entity Boundary Line into Doboj. But the crowd dispersed without incident. Moslems and Serbs have scuffled several times along the line in the past when Moslem refugees tried to surge into the town. 2874 !GCAT !GVIO Russian security supremo Alexander Lebed suddenly suspended talks with Chechen rebels on Sunday and returned to Moscow for further consultations on a deal to end the 20-month old conflict. The talks, due to take place in the village of Novye Atagi with Chechen chief-of-staff Aslan Maskhadov, were delayed amid charges by the Russian military that Chechen rebels had violated a ceasefire agreement by seizing arms from Russian troops. But Lebed, who was reported to have arrived back in Moscow before 6 p.m. (1400 GMT) said the delay was due to the fact that he had to seek legal advice and the authority of the Russian leadership before he could sign a political deal tackling the tricky issue of the future status of the rebel region. Russian troops began pulling out from southern Chechnya on Sunday under the ceasefire agreement, agreed on Thursday by Lebed and Maskhadov after some of the heaviest fighting in more than a year. But in the capital Grozny, the commander of Russian Interior Ministry forces in Chechnya, General Anatoly Shkirko, told Interfax news agency he was delaying a pullout of troops there because of the seizure of weapons from an armoured column. Lebed told reporters before leaving for Moscow from the Russian base of Khankala near Grozny that he would discuss suggestions put forward by the rebels on Saturday with President Boris Yeltsin and Prime Minister Viktor Chernomyrdin. "I hope that the president will approve of my activities. I will return to the Chechen republic to continue the negotiations with documents, impeccable from the legal point of view, in my hands," he said. Chechen rebel spokesman Movladi Udugov, speaking in Novye Atagi, 20 km (12 miles) south of Grozny, said he was not too worried by Lebed's sudden departure. "Lebed told the Chechen side yesterday that he needed to check a few details so that the agreement would not be attacked by the "party of war"," Udugov said, referring to a mysterious group of unnamed hardliners blamed for the collapse of earlier peace efforts. He told reporters Lebed had told them he had the authority to sign a deal, but agreed legal problems could have come up. "Lebed's draft was not fully worked out yesterday. Some points need more correct legal formulations," he said. Udugov said the issue of Chechnya's status would be resolved by a referendum, but it was not clear when it would take place or whether Lebed had agreed to this. Russia's constitution would have to be altered to change Chechnya's status. "The question of status has been talked over a long time ago. It's a question of the principle of putting off the solution of the question," Udugov said. "The issue of status will be decided in a referendum, by the free will of the Chechen people," he added. Lebed was earlier quoted by Itar-Tass news agency as saying that suggestions put forward by the separatists during talks on Saturday needed to be looked at by experts in international law. He did not give any details, the agency added. Lebed and Maskhadov have both said a compromise can be found between the rebels' demand for independence and Moscow's insistence the region remains within the Russian Federation. Udugov said after talks on Saturday that the two sides were close to a deal. Sunday's meeting between Lebed and Maskhadov was due to have begun at 10 am (0600 gmt). It faced a last-minute hitch after the Russian military accused the rebels of seizing and disarming a Russian interior ministry armoured column in the Chechen capital, Grozny. Udugov said at first that the delay was because Lebed was getting advice by telephone from "the highest leadership" Moscow, implying that he had been talking to Yeltsin. But he later confirmed the seizure, saying it was carried out by a renegade group. "This group does not belong to the armed forces of the Chechen republic of Ichkeria," he said. The commander of Russian forces in Chechnya, Vyacheslav Tikhomirov, later cancelled a meeting with Maskhadov, where the two men were due to sign the formal agreement on the ceasefire terms, Interfax said. He said he would not meet Maskhadov until all the weapons were returned. Udugov earlier said all the weapons had been returned and that some members of the group which seized them had been arrested by the rebels. "The Chechen side apologised officially to the Russian side and expressed the hope that provocations will not become a reason for the negotiations to be suspended," he said. 2875 !GCAT !GPOL !GVIO Russian security supremo Alexander Lebed suddenly suspended talks with Chechen rebels on Sunday and returned to Moscow for further consultations on a deal to end the 20-month old conflict. Comments by Chechen spokesman Movladi Udugov suggested the two sides could be close to an agreement to bridge the gap between them on the key issue of Chechnya's status. The talks, due to take place in the village of Novye Atagi with Chechen chief-of-staff Aslan Maskhadov, were delayed amid charges by the Russian military that Chechen rebels had violated a ceasefire agreement by seizing arms from Russian troops. But Lebed said the delay was to allow him to seek legal advice and the authority of the Russian leadership before he could sign a political deal tackling the tricky issue of the future status of the rebel region. Russian troops began pulling out from southern Chechnya on Sunday under the ceasefire agreement, agreed on Thursday by Lebed and Maskhadov after some of the heaviest fighting in more than a year. But in the capital Grozny, the commander of Russian Interior Ministry forces in Chechnya, General Anatoly Shkirko, told Interfax news agency he was delaying a pullout of troops there because of the seizure of weapons from an armoured column. Lebed told reporters before leaving for Moscow from the Russian base of Khankala near Grozny that he would discuss suggestions put forward by the rebels on Saturday with President Boris Yeltsin and Prime Minister Viktor Chernomyrdin. "I hope that the president will approve of my activities. I will return to the Chechen republic to continue the negotiations with documents, impeccable from the legal point of view, in my hands," he said. Chechen spokesman Udugov, speaking in Novye Atagi, 20 km (12 miles) south of Grozny, said he was not too worried by Lebed's sudden departure. "Lebed told the Chechen side yesterday that he needed to check a few details so that the agreement would not be attacked by the "party of war"," Udugov said, referring to a mysterious group of unnamed hardliners blamed for the collapse of earlier peace efforts. He told reporters Lebed had told them he had the authority to sign a deal, but agreed legal problems could have come up. "Lebed's draft was not fully worked out yesterday. Some points need more correct legal formulations," he said. Udugov said the issue of Chechnya's status would be resolved by a referendum, but it was not clear when it would take place or whether Lebed had agreed to this. Russia's constitution would have to be altered to change Chechnya's status. "The question of status has been talked over a long time ago. It's a question of the principal of putting off the solution of the question," Udugov said. "The issue of status will be decided in a referendum, by the free will of the Chechen people," he added. Lebed was earlier quoted by Itar-Tass news agency as saying that suggestions put forward by the separatists during talks on Saturday needed to be looked at by experts in international law. He did not give any details, the agency added. Lebed and Maskhadov have both said a compromise can be found between the rebels' demand for independence and Moscow's insistence the region remains within the Russian Federation. Udugov said after talks on Saturday that the two sides were close to a deal. Sunday's meeting between Lebed and Maskhadov was due to have begun at 10 a.m. (0600 gmt). It faced a last-minute hitch after the Russian military accused the rebels of seizing and disarming a Russian interior ministry armoured column in the Chechen capital, Grozny. Udugov said at first that the delay was because Lebed was getting advice by telephone from "the highest leadership" Moscow, implying that he had been talking to Yeltsin. But he later confirmed the seizure, saying it was carried out by a renegade group. "This group does not belong to the armed forces of the Chechen republic of Ichkeria," he said. The commander of Russian forces in Chechnya, Vyacheslav Tikhomirov, demanded that the separatist leadership return the weapons without delay, Interfax news agency said. Ugudov later said all the weapons had been returned and that some members of the group which seized them had been arrested by the rebels. "The Chechen side apologised officially to the Russian side and expressed the hope that provocations will not become a reason for the negotiations to be suspended," he said. Interfax earlier quoted a representative of the federal forces as saying that the incident could upset the peace talks. "If the separatist leadership does not fulfil the demands for the return of the seized weapons by the end of the day, it could seriously complicate Security Council Secretary A. Lebed's mission to find peaceful resolution of the Chechen conflict." 2876 !GCAT !GVIO Three Bosnian Moslems were wounded by gunshots in two separate incidents in the Sarajevo suburb of Dobrinja early on Sunday morning, NATO said. Two of the victims, civilians, had been beaten and shot in the legs and were "gravely injured", said NATO spokesman Major Brett Boudreau. A policeman was wounded shortly afterwards. "Dobrinja is certainly heating up. We have sent additional forces into the area but now that it's daylight the situation seems calm," the NATO spokesman said. Dobrinja is a community of mid-rise flats built as housing for the 1984 winter Olympic games. It lies to the west of Sarajevo's city centre, near the airport. An administrative boundary line between Bosnia's Moslem- Croat federation and its Serb republic bisects the settlement. The exact location of the line is disputed between the parties and has been the occasion for a number of violent incidents in recent months. Both shooting incidents occurred at a corner across from the airport where Moslems and Serbs sometimes transact business in no-man's land and where taxis loiter to pick up fares. Reporters who saw one of the beaten, wounded civilians in the hospital, said his face could be barely recognized because of swelling and discoloration. He reeked of alcohol hours after the attack and doctors said he was severely intoxicated. The shooting of the policeman occurred when several men pulled up to the strategic corner in a Toyota and a Volkswagen van, a police officer told Reuters. "One of them shouted 'what are you doing here?' and pulled out a pistol and fired four shots. Three missed but one of them hit my partner in the leg," said the policeman's partner. "The men drove off and I took (my partner) to the hospital. The bone in his leg is shattered." Reporters observed stepped-up NATO patrols in Dobrinja. The area was quiet but traffic and pedestrian movement along the disputed boundary line seemed greatly reduced. 2877 !GCAT !GPOL !GVIO Talks on a political solution to the conflict in Chechnya, due to resume in the village of Novye Atagi on Sunday morning, have been delayed. Interfax news agency quoted sources in the federal command as saying Russian Security Chief Alexander Lebed had not arrived for the talks with Chechen rebel chief-of-staff Aslan Maskhadov because rebels had violated an earlier ceasefire agreement. It did not say how long the talks would be delayed but Itar-Tass news agency said they would not take place on Sunday. A group of rebels had disarmed an Interior Ministry armoured column in the Chechen capital Grozny on Saturday, seizing weapons, Interfax said. The commander of Russian forces in Chechnya, Vyacheslav Tikhomirov had demanded that the separatist leadership return the weapons without delay, Interfax said. Chechen rebel spokesman Movladi Udugov said at first that the delay was because Lebed was getting advice by telephone from "the highest leadership" Moscow. But he later confirmed the seizure, saying that it had been carried out by a renegade group and that the weapons would be given back. "This group does not belong to the armed forces of the Chechen republic of Ichkeria," he told reporters in Novye Atagi, 20 km (12 miles) south of Grozny, where Maskhadov was waiting for Lebed. The Chechen side had arrested some members of the group and found out where their commander was, he said. The weapons were being collected to give them up to the Russians. "The Chechen side apologised officially to the Russian side and expressed the hope that provocations will not become a reason for the negotiations to be suspended," Udugov said. He said the Russians had told them they expected a report from the commander of the troops whose weapons had been stolen that they had got them back. "As soon as they get the report, the negotiations will be continued," Udugov said. Interfax said earlier that the incident violated the agreement reached on Thursday to end military activities in Chechnya. "If the separatist leadership does not fulfil the demands for the return of the seized weapons by the end of the day, it could seriously complicate Security Council Secretary A. Lebed's mission to find peaceful resolution of the Chechen conflict," it quoted a representative of the federal forces as saying. The meeting between Lebed and Maskhadov was due to have begun at 10 a.m. (0600 GMT). But almost four hours later it had not started. Tass said earlier that Lebed had left Khankala for the talks. But it then said that its reporters had not seen his helicopter take off for the village. The two men were due to finalise a political deal to settle the 20-month-old conflict. Both have said they believe a compromise can be found between the rebels' demand for independence and Moscow's insistence the region remains within the Russian Federation. Udugov said after talks on Saturday that the two sides were close to a deal. 2878 !GCAT !GPOL Albania's Socialist Party, the successors to communists, dumped Marxist doctrine and officially condemned the former Stalinist dictatorship in the biggest push for reform since the fall of communism in 1990. About 600 delegates ended a two-day congress by voting unanimously on Sunday to back sweeping changes to a party once regarded as the most hardline among Eastern Europe's communist states. "We have dropped from our previous programme all references to Marxist philosophy as a theoretical source of the Socialist Party," said Ermelinda Meksi, a senior official of Albania's main opposition party. In an historic step, the congress backed a proposal which officially condemned the 45-year communist regime of Stalinist leader Enver Hoxha for denying democratic values and human rights and for carrying out political persecutions. "We propose the decisive and irrevocable detachment from the dictatorial regime of Enver Hoxha and its continuity under (last communist president) Ramiz Alia," Meksi said, reading out a recommendation later backed by delegates in a vote. The congress, shifting direction to a more Social Democratic vision, agreed that party reform was needed to keep in step with the social and economic changes in the Balkan state. Meksi said the party would help to stimulate the private sector, support legitimate private business and back private ownership of land. Delegates also voted to retain jailed Socialist leader Fatos Nano as party chairman and issued a fresh appeal for his release. Nano has three years left to serve of a prison sentence imposed for embezzlement. Nano, in an address read to delegates on Saturday, urged members to reform the party and criticised the current leadership for resisting change. Acting leader Servet Pellumbi resigned despite calls from the congress floor for him to stay. "I cannot remain any longer because my concept for building the party differs greatly from those of the chairman (Nano)," he said. Many in the party praised Pellumbi leading its campaign in disputed general elections in May, boycotted by most opposition parties which accused the ruling Democrats of President Sali Berisha of rigging the poll. The congress said the Socialists should maintain their stand against taking up the handful of parliamentary seats they won in the election. Most opposition parties have also threatened to boycott local polls on October 20, arguing that an electoral commission set up by Berisha is biased in favour of the ruling party. The United States urged the Democrats on Friday to give a bigger role to the opposition parties in preparing for the elections, to adopt a new constitution and to hold fresh general elections at the earliest opportunity. Despite the show of party unity, some Socialist delegates were critical of Nano, accusing him of being out of touch in an isolated prison in the southern town of Tepelena. One senior Socialist said that although Nano had attacked the current leadership for resisting change, he had also urged the congress to nominate officials who had served under the last communist regime to a top policy-making body. 2879 !GCAT !GVIO Sensitive peace negotiations between Russian and rebel leaders to end the war in Chechnya hit a snag when Kremlin envoy Alexander Lebed returned to Moscow empty-handed from the region. Lebed, who called off a meeting on Sunday with separatist chief-of-staff Aslan Maskhadov, said he would consult President Boris Yeltsin and other leaders to try to nail down the legal technicalities of Moscow's proposals for Chechnya's political future. A rebel spokesman said Moscow had accepted the separatists' demand for a referendum, though possibly not for some years. The rebels say a free vote would back their goal of independence. But Russian Prime Minister Viktor Chernomyrdin, while saying voters should, eventually, decide the future, stressed in a television interview that Moscow also believed Chechnya should forever remain an integral part of Russia. A rebel spokesman said Lebed and Maskhadov agreed at talks on Saturday on a face-saving political formula for both sides. He gave no details and Lebed apparently thought better of concluding a deal on Sunday. Apart from optimistic rebel comments and the hard-nosed confidence of Lebed, a political novice with a former general's knack of making things sound simple, it was hard to spot the compromise that would save the latest truce from the bloody fate of previous ceasefires in the 20-month war. But Maskhadov was due to meet Russian army commander General Vyacheslav Tikhomirov at noon (0800 GMT) on Monday in the village of Novye Atagi, south of the regional capital Grozny, to seal a final accord on keeping the peace. The meeting was postponed on Sunday after Tikhomirov angrily accused the rebels of breaking the ceasefire deal by disarming a unit of Russian troops in Grozny. "I'm not going to play cat and mouse," Interfax news agency. quoted him as saying. He was later reported to have talked to Maskhadov and agreed to Monday's talks. A Chechen spokesman blamed renegade guerrillas for the incident and said the seized weapons would be handed back. Despite this and other tense moments, the ceasefire arranged last week by Lebed and Maskhadov has broadly held. Russian troops began withdrawing from the rebel-dominated Caucasus foothills in the south and joint Russian-Chechen patrols to police the truce in Grozny got under way, albeit with a fair degree of scepticism among their members. More troubling for hundreds of thousands of Chechens forced from their homes by the war, including fierce battles in Grozny after the rebels seized much of the city on August 6, was the lack of clear-cut progress on a political solution. Chernomyrdin, apparently trying to counter speculation that Lebed was going out on a limb in seeking compromises with the Chechens, stressed that Lebed was acting in full cooperation with Yeltsin and government and military agencies. Asked to confirm that Moscow might offer a referendum on Chechnya's political status, Chernomyrdin told Russian Television: "The people must decide. As they decide, so it will be." But he did not explicitly say a referendum was on offer. He also said people would have to wait till the region recovered from the war before the political question could be settled. He also insisted: "Chechnya should be part of the Russian Federation. That's simple. But when, how and with what status? It is essential not to decide that now." 2880 !GCAT !GPOL Albania's opposition Socialists, successors to the former communist party, on Sunday scrapped Marxist doctrine and condemned the former Stalinist dictatorship for carrying out political persecution. In the most radical attempt at reform since the fall of the hardline communist regime in 1990, more than 600 delegates at a landmark congress unanimously approved sweeping changes to the party's programme. "We have dropped from our previous programme all references to Marxist philosophy as a theoretical source of the Socialist Party," senior leader Ermelinda Meksi said. The congress backed a proposal to officially condemn the 45-year communist dictatorship of Stalinist leader Enver Hoxha for denying democratic values and human rights, and persecuting political opponents. "We propose the decisive and irrevocable detachment from the dictatorial regime of Enver Hoxha and its continuity under (last communist president) Ramiz Alia," Meksi said, reading out a proposal later backed by delegates in a vote. The congress agreed that reform of the party was needed to keep in step with the social and economic changes in the Balkan state, shifting direction to a more Social Democratic vision. Delegates also voted to keep jailed Socialist leader Fatos Nano as party chairman with 434 votes in favour and 140 against. No other candidate stood against Nano. "The chairman is in jail. We chose not to put up any alternative candidate," said a senior Socialist member. An address by Nano, who has three years left to serve of a prison sentence imposed for embezzlement, was read to the congress on Saturday. He called on members to reform the party and criticised the current leadership for resisting change. Nano's first deputy and acting leader Servet Pellumbi, 60, resigned his post despite calls from the congress floor for him to remain in office. Pellumbi was praised by many in the party for leading a successful campaign in a disputed general election in May which most opposition parties boycotted after accusing the ruling Democrats of rigging the poll. "I cannot remain any longer because my concept for building the party differs greatly from those of the chairman (Nano)," Pellumbi said. Pellumbi's post as deputy leader was scrapped but delegates were due to elect a new ruling body which would choose a general secretary to serve as acting leader while Nano was in prison. 2881 !GCAT !GVIO Chechnya peace prospects faltered on Sunday when talks on vital political issues failed to take place, underscoring the fragility of the negotiating process and the enormity of the obstacles. But developments in the last few days have pointed to major changes in Moscow's approach to the crisis following a rebel offensive on the capital Grozny on August 6 in which the separatist fighters seized much of the city. Russian security chief Alexander Lebed and Chechen rebel chief-of-staff Aslan Maskhadov, who had been due to meet again on Sunday in the southern Chechen village of Novye Atagi, appear to have developed a personal rapport that could turn out to be more important than any formal accords. "If Lebed approaches the political problems in the same way as the military ones, then I think it is possible to reach an agreement," Maskhadov told reporters at a ceremony this weekend marking the formation of joint Russian-Chechen police patrols. The two men had been due to sign an agreement on political questions to do with Chechnya's relations with Russia and its degree of autonomy. But the talks were derailed by a incident in Grozny and Lebed returned to Moscow for consultations. Rebel spokesman Movladi Udugov said a renegade group of Chechen fighters had seized about 50 automatic rifles from Russian troops and the Russians were waiting for the weapons to be returned before resuming negotiations. The incident dampened any peace euphoria in the mainly Moslem North Caucasus region after a ceasefire on Friday and the creation of the temporary joint military units on Saturday. The Chechens viewed the decision to form these groups as a sign of recognition by the Russians of the legitimacy of the separatist forces, although Moscow insists that Chechnya must stay within the Russian Federation. Russian Major-General Vyacheslav Ovchinnikov even referred to the the rebels in a speech as "republican fighters", avoiding the usual army terms "armed gangs", "bandits" or "terrorists". Russian liberal parliamentarian Sergei Yushenkov told NTV television last week the conflict could not be settled unless Moscow gave up the idea it was waging war against armed gangs. But the joint units have still to take up position and prove their effectiveness in keeping the peace in Grozny, where hundreds of people have been killed in the past three weeks. Udugov said the peace process remained on track. "I don't see any serious differences that we cannot overcome," he said. But tensions remained high and Moscow's so-called "party of war", as those believed to benefit politically or financially from the conflict are known, seemed at work behind the scenes. Udugov said Lebed had to settle some legal problems in Moscow before signing the political agreements, which include a clause calling for a decision on Chechnya's status within Russia to be determined by a referendum at a some later date. The 20-month conflict in Chechnya is littered with broken promises. But Chechens see Lebed as a new breed of Russian politician capable of banging heads together to bring peace. President Boris Yeltsin has ordered the tough-talking ex-paratrooper to submit concrete peace proposals by Monday and to concentrate on implementing a decree calling for a partial troop withdrawal by the end of this month. Lebed is the standard-bearer of a new approach since the rebel offensive on Grozny forced the Kremlin to rethink its Chechen policy. But to avoid falling victim to the "party of war" he will have to keep hardliners on both sides at bay. He will also need to find a way of holding new elections to introduce a Chechen leadership with more authority than the present Moscow-backed administration of Doku Zavgayev, scorned as a puppet by the separatists and many Chechen civilians. 2882 !GCAT !GCRIM Eight people died on Sunday in a blaze at a Moscow casino which the fire service said might have been started deliberately, Interfax news agency said. The number of casinos has soared in Moscow since the collapse of communism. The mayor has said he wants to cut their number to five as part of a war against organised crime. President Boris Yeltsin signed a decree on fighting crime in July and handed wide-ranging powers to security chief Alexander Lebed, currently engaged in making peace in breakaway Chechnya. 2883 !GCAT !GPOL Albania's opposition Socialists were poised on Sunday to vote to jettison Marxist doctrine in the most radical attempt at reform since the fall of the 45-year communist dictatorship in 1990. In the final day of a landmark congress, some Socialist leaders called on more than 600 delegates to turn the party into a modern, Social Democratic force and not content themselves merely with a changing of the guard. Top officials responded to an appeal for change sent from the prison cell of their jailed leader Fatos Nano, who slammed the party's acting leadership for dragging its feet on reform. "We should truly believe in and carry out the reform so that we do not just end up getting rid of certain people," Ilir Meta, 27, a vice-chairman of the party, told the congress. But Nano, who has three years left to serve of a prison sentence imposed for embezzlement, was accused by some delegates of being out of touch and badly advised. One senior Socialist member said that although Nano had attacked the current leadership for resisting change, he had recommended that the congress nominate officials who had served under the last communist regime to a top policy-making body. "Nano is right in driving us to step up the reform process but I think he made a gross mistake in trying to include people who served under (last communist president) Ramiz Alia," the senior Socialist, who declined to be identified, told Reuters. Meta, who is also the party's youth leader, said older Socialists, barred from public office because of their involvement with the former communist regime, were trying to wrest control of the party. The Socialists, reformed heirs to the communists, will vote on resolutions which would scrap references to Marxist ideas from the party's programme and for the first time condemn half a century of Stalinist dictatorship under Enver Hoxha. Nano made his first public call for change in July, a month after the conservative Democratic Party of President Sali Berisha almost swept the board in a general election, criticised by foreign observers as failing to meet international standards. The Socialists pulled out of the race and now refuse to take up the handful of seats they won in parliament. Most opposition parties have threatened to boycott local elections on October 20, arguing that an electoral commission set up by Berisha is biased in favour of the ruling party. The United States urged the Democrats on Friday to give a bigger role to the opposition parties in preparing for the elections, to adopt a new constitution and hold a fresh general election at the earliest opportunity. Foreign governments have indicated they will watch the local polls closely as a test of Albania's commitment to democracy. Berisha sent a message to the Socialist congress, branding their attempt at reform as little more than a farce. "Greeting your decision to remove Marx from the program and to condemn the dictatorship of Enver (Hoxha) and Ramiz (Alia) ...I have to say with regret that this is not reform but just a farce," Berisha said. He said the Socialists should disband their party and set up a new political force espousing Social Democratic ideas. 2884 !GCAT !GVIO In the course of one breathtaking week, Russia has swung from peace to war in Chechnya and back again as the army threatened and then dropped plans to bomb Grozny and began pulling out of the separatist region. While President Boris Yeltsin kept a low profile, sparking new rumours of ill health, his security adviser Alexander Lebed emerged as the hero of the week, stopping the bombardment threatened by the military and agreeing an 11th-hour ceasefire. His peace mission, begun a fortnight ago but interrupted by the military threat, brings the North Caucasus region the closest it has come to real peace since the conflict began in December 1994. Both Moscow and the rebels now seem ready for at least some compromise on Chechnya's quest for autonomy. But the ambitious Lebed, who has already secured the sacking of a clutch of Kremlin hardliners and is now gunning for Interior Minister Anatoly Kulikov, has said his mission and his life are threatened by a mysterious "party of war" in Moscow. The rebels, who sparked the worst fighting in more than a year by seizing most of the Chechen capital Grozny on August 6, greeted Lebed's appearance with enthusiasm, seeing it as a sign that the Russian leadership was serious about peace. "The most important thing is that there is a firm decision to stop the war which makes it easy for us to discuss details," Maskhadov said after relaxed face-to-face talks with Russian troop commander Vyacheslav Tikhomirov on Friday. "It is difficult to talk to each other when you don't know if they want to end the war." Just two days before, Tikhomirov had appeared to back his deputy Konstantin Pulikovsky's threat to flatten Grozny, by saying the rebels would get no more warnings and that the "most decisive means" would be used against them. As the Thursday deadline approached, a string of western governments urged Moscow to reconsider, but the International Monetary Fund gave the Russian government a boost by paying up on the July tranche of its $10.2 billion three-year loan. The fund, which argues that its lending has no political link, said its concerns about Russia's budget had been overcome. Lebed, who flew to Chechnya on Wednesday as troops began pounding the capital with artillery and bombs, said Pulikovsky's threats had been a "bad joke". Lebed ally Defence Minister Igor Rodionov said Pulikovsky had been acting on his own and that he had been reprimanded. But Lebed began to look like the odd man out when Yeltsin returned from what aides said was a visit to the countryside to check out a holiday home. The president said on Thursday that he was not pleased with his envoy's progress in Chechnya. Just hours later Lebed agreed the ceasefire with Maskhadov, part of a military deal which included the withdrawal of Russian troops from the region and was expected to be followed by a political agreement at the weekend. Yeltsin waited until Friday evening before telephoning Lebed to give him the okay to negotiate a deal on the region's status -- the issue at the heart of the 20-month-old conflict and which has not been broached before. Some analysts explained Yeltsin's tardiness by speculating that the 65-year-old Kremlin leader, who overcame two heart attacks last year to stage an energetic and successful campaign for a second term, was ill and out of touch. But he managed to approve new ministers to the cabinet, including leftist Aman Tuleyev, who was appointed minister for links with other Commonwealth of Independent States in a nod to the communists and their allies who dominate parliament. Aides dismissed talk of ill health and other commentators argued that Yeltsin might simply have been waiting to see whether the hawks or the doves in his entourage came out on top. It is still not clear. On Saturday, Russian troops began withdrawing from Grozny and further south, some 500 troops and rebels lined up shoulder-to-shoulder in a surreal carnival atmosphere to form joint security teams to police the city. But while the two sides were said to be close to a compromise deal putting off a decision on Chechnya's status on Saturday, on Sunday the peace process hit a hitch. Instead of heading for new talks with Maskhadov in southern Chechnya, Lebed suddenly flew back to Moscow, saying he needed to consult Yeltsin further before signing a deal. Rebel spokesman Movladi Udugov said he was not too worried about Lebed's last-minute change of plans, but alleged ceasefire violations and an outburst of tough words from the military cast a shadow of doubt over future peace efforts. The main hurdle, selling a compromise deal to those on both sides still angry at the slaughter -- more than 30,000 people have been killed since the conflict began -- still lies ahead. 2885 !GCAT !GDIP !GPOL !GVOTE The status of 8,000 of 28,000 declared candidates in Bosnia's forthcoming elections is in doubt because international election supervisors cannot find their names on the country's last census list, OSCE said on Sunday. The announcement came just three weeks before Bosnians are due to go to the polls to elect municipal and cantonal assemblies, separate Moslem-Croat and Serb parliaments, a joint national House of Representatives and a three-man Presidency. Under rules laid down by the Organisation for Security and Cooperation in Europe (OSCE), which is supervising the election, all candidates must appear on a Provisional List of Voters based on the 1991 census for Bosnia Herzegovina. "In the ongoing process of the review of candidacies...we were unable to locate on the Provisional List of Voters the names of some 8,000 candidates out of the approximately 28,000 names received," OSCE said in a statement on Sunday. "Political parties have been advised of this and we are seeking their assistance in finalizing this last step in the verification process..." OSCE said only 12 out of 28,000 candidates had been disqualified so far -- two of them as indicted war criminals, some because they were running for more than one office and several others who asked that their names be dropped. The September 14 elections are under pressure on a number of procedural issues, but especially over alleged irregularities in the registration of Bosnian Serb refugees. The OSCE's Provisional Election Commission (PEC) in Sarajevo -- top rule-making body for the balloting -- is considering a number of options to respond to the voter registration issue. One possibility is to postpone elections in affected municipalities. A decision is expected when the PEC meets on Monday. The ruling Moslem nationalist SDA party was scheduled to meet in Sarajevo on Sunday to debate the registration issue. SDA has called for a postponement of all municipal elections and annullment of the rights of refugees to vote in locations other than their 1991 place of residence. Party leaders have hinted at a boycott if they do not get their way. Bosnian President Alija Izetbegovic, who heads the SDA, addressed a rally of refugees in Germany of Saturday and told them Serb registration problems would not be overlooked. "It will not pass," he told the audience. "I swear it will not pass." OSCE is also struggling, along with NATO and U.N. police officials, to prevent and contain potential violence in Bosnia on election day. NATO issued a list of 12 communities where, based on recent activities, it felt there was a potential for trouble on September 14. Eight of the municipalities were inside the Moslem-Croat federation and four were in the Serb republic. Problems are anticipated in those towns if refugees from one ethnic group try to cross de facto ethnic boundary lines to vote in a place controlled by another group. 2886 !GCAT !GPOL !GVOTE The Baltic state of Estonia holds presidential elections on Monday when arch-rivals President Lennart Meri and former senior communist Arnold Ruutel will battle to head the former Soviet republic. The national parliament, convening for an extraordinary session at 0800 GMT, will hold a secret ballot to decide whether to give the charismatic Meri a second term of five years or replace him with Ruutel, deputy parliamentary speaker. The duel is a repeat of the first presidential election in the former Soviet republic a year after independence in 1991 when Meri, a writer and film-maker, beat Ruutel, former head of an agricultural college, in a parliamentary vote. Although Meri is the favoured candidate for Monday's poll, the result was far from certain, with a successful candidate needing to win 68 votes from the 101-member parliament (Riigikogu) to secure the presidency. "Neither candidate has enough support to win 68 votes at the moment...as Meri does not have the support of the majority of the parliament and Ruutel has even weaker prospects," said an editorial in Estonian daily newspaper Eesti Paevaleht. Meri, 67, has been considered a successful president. He is an impressive speaker who represented Estonia well on the international stage, speaking up to eight languages, and played a key role when the government collapsed last October in a bugging scandal. But he has been accused by parliament of overstepping the mark and taking too much power. A major criticism against him is that he signed an agreement on the withdrawal of Russian troops in 1994 without consulting parliament. In recent weeks his reputation as corruption-free has also taken a battering from media allegations that he used his influence to persuade a local council to sell a piece of prime real estate. However a poll of politicians by Estonia's largest selling daily newspaper Postimees, published on Saturday, found 57 MPs publicly supported Meri, 30 backed Ruutel and the rest were undecided. "Meri is more popular, particularly in parliament, but it is hard to judge as the incumbent president is always more popular than the opponent," political scientist Rein Toomla of Tartu University told Reuters. "Ruutel is more popular in rural areas and it will be a very close thing. It looks as if neither will get 68 votes." If neither candidate secures enough support on Monday, voting will be held again on Tuesday, with the election reopened to new candidates. If no-one wins the necessary 68 votes in the second round, a third round will be held later in the day and if this fails, the parliamentary speaker will convene an electoral college of the 101 MPs and 273 local government representatives to vote again. "This would take some time to put together and would not be held until September, even as late as a month from now," Estonian Foreign Ministry spokeswoman Mari Ann Kellam told Reuters. But as well as a popuarity contest between the two men, the election is viewed by political analysts as an important test for the 10-party parliament to show it can overcome political wrangling and act as a single force. "This is the most sophisticated exam for parliament since its formation 18 months ago (at a general election)," said an editorial in Postimees. Toomla said parliament's ability to elect a president without an electoral college would be a show of strength and boost public confidence in the parliament that governs the 1.5 million people in the smallest of the three Baltic states. "A lot of people think that if the parliament cannot succeed in electing a president on its own, then what can it do," he said. 2887 !GCAT !GVIO Russian troops began to quit southern Chechnya on Sunday as part of a peace deal brokered by Russian security chief Alexander Lebed but hitches in the capital Grozny stalled the pullout there. To Moslem cries of "Allahu Akbar" (God is Greatest) from local Chechens, a column of around 40 Russian vehicles took the dusty road from the mountain village of Shatoi. The column included 10 tanks, eight armoured personnel carriers, six field guns and 15 trucks. The withdrawal was supposed to take place on Saturday but was delayed so the Russians could clear their mines. In Grozny, however, the commander of the Russian interior ministry forces in the region, General Anatoly Shkirko, told Interfax news agency he was delaying the pullout from the city after Chechens disarmed a column of interior ministry troops. He said the pullout, which started on Saturday, would be suspended until the weapons were returned. Interfax did not say how many Russian troops have already left Grozny. Chechen rebel spokesman Movladi Udugov confirmed the weapons had been seized but said it was a renegade band of Chechens. He later said that the rebels had handed over the weapons. The Russian troops from Shatoi were escorted by Chechen jeeps, flying their green, white and red flag, emblazoned with a black wolf emblem. The area is a wooded, mountainous region, dotted with deep ravines and full of villages ruined in earlier fighting. It was the scene of Russian bombing raids after President Boris Yeltsin was reelected for a second term in office on July 3. "I hope Lebed will be able to do his job. I see that all this has happened quickly," said one Chechen woman, watching the Russian vehicles rolling down the road. The talks on finding a political solution to the Chechen conflict were delayed on Sunday after Lebed flew to Moscow for consultations with the Russian leadership. In Grozny, an uneasy truce held sway on what was planned to be the first day of joint police patrols by Russian troops and Chechen fighters. Reuters photographer Ulli Michel said Chechen fighters at some checkpoints in Grozny were unaware of the plans for joint patrols and seemed unwilling to cooperate. "No Russian soldiers will come into our territory to patrol this block," one Chechen fighter said defiantly. At a rebel base in the centre of the city, Russian soldiers and Chechen fighters mingled uneasily amid mutual suspicion. A 15-second burst of fire nearby was enough to send each side back to waiting armoured personnel carriers. 2888 !GCAT !GVIO Russian troops began to pull out from southern Chechnya on Sunday under a ceasefire agreement between Russian security chief Alexander Lebed and rebel leaders. But in the capital Grozny, the commander of Russian Interior Ministry forces in Chechnya, General Anatoly Shkirko, told Interfax news agency he was delaying a pullout of troops there after a group of Chechens disarmed an armoured column. Reuters cameraman Liutauras Stremaitis said a column of around 40 vehicles, including tanks, armoured personnel carriers, artillery cannons and lorries, escorted by Chechen rebels, pulled out of the village of Shatoi towards the border, around 50 km (31 miles) to the north. In Grozny, Shkirko told Interfax he was suspending the pullout of troops from the capital until weapons seized by the Chechens were returned. Chechen rebel spokesman Movladi Udugov confirmed the weapons had been seized but that it was a maverick group of Chechens. He said later that the rebels had handed them over. The pullout of the Russian troops is a key element of the peace plan brokered by Lebed, which aims to end the 20-month Chechnya conflict. 2889 !GCAT !GPOL !GVIO Chechen rebel spokesman Movladi Udugov said on Sunday he was not too worried by a cancellation of peace talks and that the issue of Chechnya's future status would be decided by a referendum. Russian Security chief Alexander Lebed left for Moscow instead of attending talks on a political deal with the rebels. "Lebed told the Chechen side yesterday that he needed to check a few details so that the agreement would not be attacked by "party of war"," Udugov told reporters in Novye Atagi, 20 km (12 miles) south of Grozny. "The issue of status will be decided in a referendum, by the free will of the Chechen people," he said. "The question of status has been talked over a long time ago. In principle, it's a question of putting off the solution of the question," Udugov said. It was not clear whether the Russian side had agreed that the issue should be solved by a referendum. The separatists declared Chechnya independent from the Russian Federation in 1991, but Moscow, which sent in troops in December 1994 to crush moves towards seccession, insists the republic cannot split away. Lebed said before he left for Moscow earlier on Sunday that he needed to consult with lawyers and the Russian leadership before signing a political deal with the rebels. 2890 !GCAT !GPOL !GVIO !GVOTE Diplomats in the Balkans are warning that the Bosnian peace process which began in Dayton last year is at risk of stumbling badly by insisting on the form but not the content of democracy. They say the mere casting of ballots in Bosnia-wide elections on September 14, a key pillar of the Dayton agreement that ended 43 months of war, will not by itself solve the country's problems. "A lot of little lies have been told in Bosnia which are now culminating in the big lie of allegedly democratic elections," said a Western diplomat in Sarajevo who asked not to be named. "The scheming and mendacity of the Bosnian factions is no surprise. But the history of the West's involvement in Bosnia since the war began is also to say one thing and do another, to make a pledge and fail to deliver. Dayton is no exception." Many international observers feel that with key parts of the Dayton still unfulfilled, the basic reforms necessary to support democratic elections are not in place. What was billed as an electoral process to reintegrate Bosnia as a single, multi-ethnic state is seen by critics as a referendum on partition, de facto or de jure. Having suffered through Europe's worst war in half a century in which some 200,000 people died, Bosnia's Moslems, Croats and Serbs took heart from the internationally-sanctioned Dayton peace agreement signed in December 1995. Dayton guaranteed refugees the right to return to their homes, ensured freedom of movement and served notice that indicted war criminals would be brought to justice before a U.N. tribunal at the Hague. Substantial responsibility for this post-war programme was assigned to the former warring factions, but more than 50,000 NATO-led combat troops and 1,600 U.N. police were also despatched to Bosnia to seal the deal. Hordes of western bureaucrats also descended on the country to rebuild roads, bridges, housing and government institutions. The promise and the premise of the Dayton peace agreement were that justice and human rights, capped by democratic elections, were the balm for the Bosnian war and the basis for long-term peace and reconciliation. NATO quickly separated the formerly warring factions and got the armies back to barracks -- no mean feat. But then NATO troops began patrolling what was supposed to be an administrative and porous boundary line between Bosnia's two halves, its Moslem-Croat federation and its Serb republic. This helped to turn the boundary line into a border, which was exactly what the separatist Serbs wanted. Refusing to assume policing duties, NATO said it was up to U.N. police monitors and local Bosnian police to facilitate freedom of movement and the return of refugees across the "Inter-Entity Boundary Line." Unarmed U.N. police lacked the muscle. Local police, in the service of whichever nationalist party controlled their area, far from contributing to a new freedom of movement actually blocked it. The round-up of war criminals fared no better than freedom of movement or the return of refugees. NATO refused to engage in manhunts and seemed at times to go out of its way to avoid encountering indictees. Eight months after Dayton was signed, former Bosnian Serb president Radovan Karadzic and his army commander General Ratko Mladic -- both indicted for war crimes by the Hague tribunal -- remain at large in the midst of a massive NATO deployment. The Organisation for Security and Cooperation in Europe (OSCE) is the post-Cold War, trans-Atlantic combine charged with supervising Bosnian elections on September 14. OSCE recently concluded and publicly announced that conditions for free and fair elections in Bosnia do not exist, citing restrictions on freedom of movement, association and press and the inability of refugees to return to their homes. However the OSCE decided to proceed with elections nonetheless, saying there was a reasonable prospect they would be democratic. 2891 !GCAT !GPOL !GVIO Security chief Alexander Lebed left Chechnya on Sunday for Moscow to consult the Russian leadership after talks on a political solution to the conflict were delayed, Interfax news agency said on Sunday. Itar-Tass agency earlier quoted Lebed as saying Sunday's negotiations were cancelled over legal difficulties which arose while finalising a settlement document. Lebed spoke at a news conference at a Russian base near the Chechen capital. Interfax said Lebed considered that new suggestions put forward by the separatists during talks on Saturday needed to be looked at by experts in international law. Lebed said he would have to meet President Boris Yeltsin and Prime Minister Viktor Chernomyrdin to receive authority to sign an agreement with the rebels. "I hope that the president will approve of my activities. I will return to the Chechen republic to continue the negotiations with documents, impeccable from the legal point of view, in my hands," he told reporters. Tass later quoted Lebed's spokesman Alexander Barkhatov as saying that "work on political questions for the settlement of the Chechen conflict between the federal centre and the separatists has been suspended but there is hope that contacts will be continued". 2892 !GCAT !GDIP !GVIO When Yugoslavia signed a treaty on Friday normalising relations with Croatia it effectively abandoned nationalist dreams of a Greater Serb homeland. The accord, an historic step towards a durable peace in the Balkans, was welcomed by foreign diplomats but viewed as treason by Yugoslav ultra-nationalists and militants in Croatia who harbour resentments against Serbs after years of conflict "Recognition of Croatia's independance, sovereignty and territorial integrity in its Communist, i.e. non-ethnic borders, represents a great defeat and a catastrophe for the whole Serbian people," said Aleksandar Vucic, secretary-general of the Serbian Radical Party. "This is the biggest betrayal and capitulation that could happen to our country and our people." Diplomats said that there were subdued voices of dissent even in the government of Yugoslavia, which encompasses the territories of Serbia and Montenegro. "There are some who cannot comprehend that the war is over. Arguably, it is rather difficult to face what they see as pure Serbian capitulation," one diplomat said. But what seems to the militants a capitulation is set out in a declaration by the Yugoslav foreign ministry. "The Federal Republic of Yugoslavia and the Republic of Croatia have agreed to delineate their borders by mutual agreement, to resolve all disputes by peaceful means and to refrain from using threats or force in line with the U.N. Charter." Western diplomats said the wording meant Belgrade had relinquished claim to all lands in Croatia. "Nationalists in Serbia simply cannot comprehend that their dream of Greater Serbia is finally dead and buried," one diplomat said. Ironically the man to bury the dream is the one who stoked it in the first place -- Serbian President Slobodan Milosevic. Milosevic armed rebel minority Serbs in Croatia in 1991 and in Bosnia in 1992. The virulent nationalism and the six-month war in which thousands died and some half a million people were left homeless helped him and Croatian President Franjo Tudjman consolidate power. But in 1993 when international sanctions and pressure on Serbia became unbearable, Milosevic became conciliatory, urging recalcitrant kin in Croatia and Bosnia to opt for peace. Leaders of rebel Serbs in Croatia, complacent and fat on widespread war profiteering, refused and as a result lost their centuries-old homes in that country. Some 200,000 fled a stunning Croatian government army offensive to recover their lost territory in 1995. But Milosevic secured half of Bosnia for the Serbs and got to keep the mostly ethnic Albanian province of Kosovo, cradle of Serbian history and original source of the Yugoslav conflict. When Albanians rose up in 1981, just a year after the death of Yugoslav President Josip Broz Tito who kept the ethnically mixed country intact for decades with an iron fist, the Serbs cracked down brutally. The reaction fanned fear of their domination throughout the other republics. The Serbs lay claim to Kosovo, where they were a minority, as their historical heritage, just like the Croats claim their western and eastern Krajina regions where they were a minority. Now that Serbs have left Croatia, the most the Albanians can hope for is a form of autonomy. Croatian nationalists fear that Tudjman, who they accuse of being a Western puppet, will give a similar status to Serb refugees who opt to return to their homes which they are allowed to do in guaranteed safety under Friday's accord. In Croatia, Anto Djapic, leader of the extremist Croatian Party of Rights (HSP), said: "After all it has done to Croatia, Serbia should be the last country on earth to recognise. Bosnian Foreign Minister Jadranko Prlic, a Croat, said the accord "will certainly have a positive effect on the creation of a stable peace on the entire territory of the former Yugoslavia." 2893 !GCAT !GPOL !GVIO Security chief Alexander Lebed will soon return from Chechnya to Moscow for consultations with the Russian leadership after talks on a political solution to the conflict were delayed, Itar-Tass news agency said on Sunday. "Lebed said that the reason for the cancellation of today's negotiations was legal difficulties which arose while finalising the document," it said, adding that Lebed was speaking at a news conference at the Russian base near the Chechen capital. 2894 !GCAT !GPOL !GVIO Talks on a political solution to the conflict in Chechnya, due to resume in the village of Novye Atagi on Sunday morning, have been delayed. Interfax news agency said the delay was because rebels had violated a ceasefire agreement. But Chechen rebel spokesman Movladi Udugov said Russian Security chief Alexander Lebed was getting advice by telephone from Moscow. The meeting between Lebed and the Chechen rebel chief-of-staff was due to have begun at 10 am (0600 gmt). But almost three hours later it had not started. Rebel spokesman Movladi Udugov told reporters in Novye Atagi, 20 km (12 miles) south of Grozny, that Lebed, who spent the night at the Russian military base of Khakala near the Chechen capital, was on the telephone to Moscow. "Lebed is now getting advice from the highest leadership in Moscow," Udugov said, implying he was talking to President Boris Yeltsin. But Interfax later quoted federal military sources at Khankala as saying that the meeting had been postponed because rebels had disarmed an interior ministry armoured column in Grozny on Saturday, seizing weapons. 2895 !GCAT !GVIO Three Bosnian Moslems were wounded by gunshots in two separate incidents in the ethnically disputed Sarajevo suburb of Dobrinja early on Sunday, NATO said. Two of the victims, civilians, were beaten and shot in the legs, said NATO spokesman Major Brett Boudreau. They were taken to hospital, "gravely injured". A third victim, a policeman, was wounded later and also taken to hospital, Boudreau reported. "Dobrinja is certainly heating up. We have sent additional forces into the area but now that it's daylight the situation seems calm," the NATO spokesman said. Dobrinja is a community of mid-rise flats built as housing for the 1984 winter Olympic games. It lies west of Sarajevo's city centre, near the airport and an administrative boundary line between Bosnia's Moslem- Croat federation and its Serb republic bisects the settlement. The exact location of the line is disputed between the parties and has been the occasion for a number of violent incidents in recent months. 2896 !GCAT !GODD A six-year-old boy was mauled to death by a bear after climbing onto the roof of its enclosure in a Caucasus nature reserve, Itar-Tass news agency said on Sunday. Tass said the brown bear, which had been rescued by wardens as an orphaned cub, grabbed the child by one leg and pulled him into the enclosure. Police arrived within minutes and shot the bear, but the boy died of his injuries. 2897 !GCAT !GREL Black-coated rabbis, women in expensive frocks and children waving flags danced under a blazing sun to celebrate laying the foundation stone of Kazakhstan's first synagogue. But the new building in the Kazakh capital may not be enough to anchor Almaty's Jews, who are leaving to start new lives in Israel. Jews, mostly Tsarist officials, first settled in Almaty a century ago. Their numbers were augmented by Jews either exiled to the Kazakh steppe by dictator Josef Stalin or fleeing Nazi Germany. Soviet repression drove the community's prayers and festivals underground and Jewish leaders said Almaty had never had its own synagogue. Rabbi Moshe Kotlarsky, a New Yorker and a senior member of the orthodox Lubavitch movement, laid the foundation stone in a dusty plot on the outskirts of Almaty earlier this month. The stone, made from the tombstone of a rabbi banished from Ukraine by Stalin in 1939, marked the start of work on the synagogue and a ritual mikvah bath. "This is symbolic of what's happening throughout the former Soviet Union, there is a resurgence of Judaism here," said Kotlarsky. "Jews are not leaving." Chief Rabbi Yeshaya Cohen was equally enthusiastic. "This is history. We're building a Jewish community, we feel freedom," he said before leaping back into the throng gyrating to a band blaring out Jewish music beneath the peaks of the Tien Shan mountains. The stuffy international departure lounge at Almaty's airport told a different story. Marina Kavshova, 32, perspired in the hot summer night as she cast worried glances over a large pile of baggage and two energetic daughters, Olya and Katya. The trio was waiting to board a flight to Tel Aviv, one of several families emigrating to Israel that evening. "It will be my first time (in Israel), it's a big step," said Kavshova. "But I have to go for the children, they will have a better life there." She said the Israeli government paid for their air tickets and arranged housing in Israel, where many Jews from the former Soviet Union have already emigrated. Reliable figures for the size of Almaty's Jewish population, which after World War Two topped 50,000, are hard to come by. But Israel's Jewish Agency says 7,570 Jews have left Kazakhstan and settled in Israel since 1989. Economic uncertainty is the main reason for leaving. Miserly wages often go unpaid for months in Kazakhstan. "I want a normal salary," said Leonid Parkhomenko, a 47-year-old building worker, before checking in for the Tel Aviv flight with his wife and two daughters. Most of the Bukhara Jews in neighbouring Uzbekistan have also left, leaving the region they first settled as traders on the Silk Road in the 12th and 13th centuries. Jews had seven synagogues in Bukhara until the 1917 Bolshevik revolution. Jewish merchants once sent camels laden with Chinese silk across the region's harsh mountains and deserts as far as Moorish Spain. The Jewish Agency says 64,500 Jews have left Uzbekistan for Israel since 1989. The remaining Jewish community in the Uzbek capital Tashkent is building a school for 300 children at a cost of $100,000. "This will be the first full-time school for Jewish children in Central Asia," Roman Benzman, an aide to Tashkent's chief rabbi, said proudly, shouting above the noise of builders hammering and welding inside the new school. But like the synagogue in Almaty, it will not stop Uzbekistan's Jews from leaving. "Every week, Jews are leaving Samarkand," said Osher Karnowsky, a 21-year-old Londoner teaching Jewish scripture to a dwindling community of Jews in the city of blue-tiled mosques, south of Tashkent, and built by the Emperor Tamerlane. In Almaty to attend celebrations for the new synagogue, Karnowsky said: "In Uzbekistan, I don't think there will be a Jewish community, it will be the end of a long history." 2898 !GCAT !GSCI Four European space agencies have decided to install a radio telescope observatory in the mountains near Salta in northern Argentina, state news agency Telam reported on Sunday. The four include the Dutch Foundation for Astronomy Investigation and a French agency. Conditions in the northern regions of Chile and Argentina are considered well suited for observing space because of the dry climate and high altitude. 2899 !GCAT !GVIO Colombia's National Police chief on Sunday supported a regional commander who allowed his men to disguise a police vehicle as a Red Cross ambulance during riots in the southwest city of Florencia. "I understand the position of the Red Cross, but I also understand the commander's," Gen. Rosso Jose Serrano said in an interview with the NTC television news programme. Television pictures of police unloading tear gas cannisters from the back of a truck, clearly marked with the internationally-recognised symbol of the Red Cross, have been shown repeatedly in Colombia since Friday when riots erupted in Florencia, capital of jungle-covered Caqueta province. In the footage, police can also be seen bundling at least two rioters into the back of the vehicle. The incident has prompted a public outcry from Red Cross officials in Bogota and Geneva, who say the misuse of the organisation's symbol was strictly forbidden by international law. It has also led to calls by Interior Minister Horacio Serpa for a full investigation, since Colombia's own military code of conduct was violated. Deputy National Police director Luis Enrique Montenegro said on Saturday if the Red Cross symbol was misappropriated "it was well done," however, because police needed all the help they could get in Florencia. Serrano, on a more conciliatory note, said the actions of the Florencia commander were "exaggerated" and added, "I don't think it will happen again." Friday's riots, which police and other military officials have blamed on leftist guerrillas, capped a month of protests in Caqueta and two neighbouring provinces aimed at the government's drug crop eradication programme. 2900 !GCAT !GCRIM !GPOL Panama's former President Guillermo Endara criticised as "superficial" the nation's probe into how drug money entered the ruling party's 1994 campaign. "This rapid decision makes us think that the investigation was superficial and not deep enough," Endara told the daily newspaper El Panama America which was published on Sunday. "The investigations were too quick and did not comply with (President Ernesto) Perez Balladares' promise to investigate to the ultimate consequences," said Endara, a member of Panama's largest opposition party Arnulfista. Panama's police drug unit recently closed its investigation into how two checks for $51,000 were contributed to the ruling party's campaign by accused Colombian drug lord Jose Castrillon Henao, currently held in a Panama City jail. "Everything was analysed, such as how they received the checks, and we arrived at the conclusion that there wasn't any illicit behaviour," said Rosendo Miranda, head of Panama's Technical Police drug unit. The findings will be sent to a circuit court judge for a final ruling. 2901 !GCAT !GCRIM More than 85 percent of the population in Argentina feels unsafe, according to a poll reported on Sunday in the daily Clarin newspaper. Argentines have traditionally prided themselves on the safety of their country from the ills of drug abuse and violent crimes found elsewhere in Latin America. But the poll, carried out for Clarin by the Centre for Studies of Public Opinion (CEOP) in the capital, found that 85.3 percent of the respondents "felt unsafe". More than half of the respondents have had a crime committed against them. Some 26.8 percent were attacked on the streets while 14.8 percent had their houses robbed. The poll also found that despite rising crime, the public felt unprotected with 44.4 percent saying they did not have faith in the police. Crime has increased in Argentina in the last few years following a severe recession that resulted in record high unemployment. The jobless rate remains just under its historic high of 17.1 percent. Nearly half of the respondents said job creation would be a solution to crime. More attention has been given to crime recently, particularly due to a number of high profile crimes including an attack on the house of President Carlos Menem's brother. The poll's margin of error percentage was not available and the newspaper did not indicate how many people had been interviewed. 2902 !E12 !ECAT !GCAT !GPOL !GVOTE Mexican Finance Minister Guillermo Ortiz on Sunday pledged that Mexico would not attempt to promote short-term growth to give the ruling Institutional Revolutionary Party (PRI) a boost for 1997 congressional elections. The finance minister also said in a television interview that Mexico would end tax evasion by the wealthy and that a crackdown was under way. In an interview with the Multivision cable system, Ortiz acknowledged that PRI governments in the past have attempted to stimulate the economy during election years, only to pay serious consequences later. "There are no shortcuts," Ortiz said, mentioning politically motivated ideas of increasing the money supply or boosting government spending. "The only thing we would accomplish with that would be an emphemeral impulse that would bring us just the opposite results of what we're looking for." Mexico has gone through a series of economic crises over the past 20 years thay many analysts have attributed to election-year tinkering. "I think that experience that we have had in the past should serve as a lesson so that we don't repeat the same errors," Ortiz said. "The government is going to act with total responsibility and we are going to continue maintaining monetary and fiscal discipline." Ortiz said just that discipline has led to better-than-expected results in 1996 in terms of keeping inflation down while reactivating an economy thrown into crisis by the December 1994 peso devaluation. He said Mexico's needs are still outstripped by its resources, but rather than create new taxes, the government would crack down on tax evaders, particularly among the very wealthy. "We are acting, certainly, and there will be more," Ortiz said. "The Attorney General's Office is seeking arrest orders against dozens of people. ... We are going to end tax evasion among the wealthy." --Dan Trotta, Mexico City newsroom, (525) 728-9507 2903 !GCAT !GVIO The leftist Popular Revolutionary Army (EPR) in a published report on Sunday said it operated throughout Mexico, including the capital, and denied government assertions it was isolated to one state. Commanders "Vicente" and "Oscar", guarded by a dozen EPR gunmen, said in an interview with La Jornada outside Mexico City that the armed group was committed to overthrowing the government. "They (government officials) want to present us before public opinion as a local problem, as just being from Guerrero and as irrational radicals," Commander Oscar told La Jornada. They said the ERP, whose fighters first appeared wearing military fatigues and brandishing assault rifles in the southwestern state of Guerrero on June 28, had a 23,000-strong membership, but this could not be confirmed independently. La Jornada also reported on Sunday that the Mexican Army has discovered a 37-page, EPR manual detailing guerrilla tactics and strategies. It quoted the manual as saying: "The objective of the Basic Course on War is to provide for combatants of the EPR basic military knowledge for the armed conflict against the police and military apparatus of the bourgeoisie." It was the second time armed "commanders" of the EPR have granted interviews outside Guerrero state, an extremely poor and volatile region where leftist protesters often have clashed violently with authorities. Unlike the better known and unrelated Zapatista rebels in southeastern Chiapas state, the EPR has never taken on the army in direct combat, according to official reports. There have only been a few skirmishes in Guerrero in which a handful of police, soldiers and civilians have been killed or injured. 2904 !GCAT !GVIO Unidentified gunmen dragged 10 men out ot their homes in a rural area of Colombia's northwest province of Antioquia and shot them to death, authorities said on Sunday. Police said the killings occurred on Saturday morning in the municipality of Anza but news of the massacre only reached the provincial capital of Medellin early on Sunday. Anza is only 20 miles (30 km) west of Medellin, but there are no roads linking it directly to the city. Police initially said leftist Revolutionary Armed Forces of Colombia (FARC) rebels were prime suspects in the killings. But gunmen of the left and right have killed with impunity across Antioquia for years, and there were unconfirmed reports that the latest bloodshed was the work of a right-wing paramilitary group. 2905 !GCAT (Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW Schools, Vocational Education and Training Minister David Kemp said the Federal Government will be asking schools to take on greater responsibility for the job prospects of their graduates, and their activities may even be extended to become employment placement enterprises. Page 1. -- The Industry Commission has offered the automotive industry more influence over the agenda of the Commission's review of the industry's assistance arrangements after 2000 and has said the main subject for the review to look at would be productivity. Page 3. -- The ACTU is planning to launch a major campaign against superannuation changes announced in last week's Federal Budget, arguing the changes will allow employers to stop any payments to low-paid workers and undermine a universal superannuation system. Page 5. -- Opposition Leader Kim Beazley has claimed the new Charter of Budget Honesty will force the Opposition to delay detailed election promises until the second week of the next election campaign, and while he indicated his party's support for the government's new charter, he claimed it would "massively" constrain debate. Page 5. -- THE AUSTRALIAN Former Defence Minister and National Party Leader Ian Sinclair, has, in his role as chair of the joint parliamentary foreign affairs and defence committee, advised Prime Minister John Howard to meet Tibetan spiritual leader the Dalai Lama in defiance of warnings by the Chinese Government. Page 1. -- Controversy continued over the weekend after Brisbane's Courier Mail newspaper published an eight page spread alleging one of Australia's foremost historians, Manning Clark, was awarded the Order of Lenin, the Soviet Union's highest decoration. Clark's fmily admits he was awarded a medal in Moscow in 1970 after delivering a lecture on Captain Cook, but denies it was the Order of Lenin. Page 1. -- A study conducted for the Council for Aboriginal Reconciliation has found that three in four Australians support a formal reconciliation agreement with legal backing that acknowledges that aborigines lived here before European settlement. Page 1. -- New South Wales National Party leader Ian Armstrong last night made an embarrassing backdown from his threat to split from the Coalition after five hours of crisis talks. New South Wales Opposition Leader Peter Collins has confirmed the Liberals would run a candidate against the Nationals in Port Macquarie, a safe National party seat. Page 3. -- THE SYDNEY MORNING HERALD Commander Peter Sinclair, the captain of Australia's first commissioned Collins class submarine, is pushing for it to be fitted with Tomahawk cruise missiles. Concerns are held that this could see a regional race for such long-range attack weapons. Sinclair also admitted the submarines will be used for extensive intelligence gathering and communications intercepting operations. Page 1. -- The allegations by Brisbane's Courier Mail newspaper that Australian historian Manning Clark was a spy looked shaky last night, as Clark's cousin, former New South Wales Supreme Court judge Bob Hope called them baseless and disgusting. The Courier Mail caimed Clark was "indeed a communist" and an "agent of influence" for the Soviet Union during the cold war days. Page 1. -- Despite a backdown by the New South Wales National Party to allow the Liberal Party to contest the Port Macquarie by-election, the future of the New South Wales Coalition remained in limbo overnight. Page 1. -- New South Wales health and agricultural authorities are investigating claims that meats and meat products may be spreading a drug-resistant germ associated with one found in livestock fed the antibiotic avoparcin from livestock to humans, after the diagnois of four Australian patients with the bug. Page 3. -- THE AGE Prime Minister John Howard has questioned Australia's aboriginal leaders, wondering if they fully represent indigenous views. He believes they have failed to cooperate with the Coalition Government, and his comments will increase pressure on the relationhip between the Government and the Aboriginal community. Page 1. -- Fitzroy players, officials and supporters attended their own funeral at the Melbourne Cricket Ground yesterday as the 100-year-old Australian Rules team played its last game in Melbourne. More than 48,000 people witnessed the final game, which saw the clb thrashed by Richmond by 151 points. Page 1. -- Legislation to be tabled in the Victorian Parliament over the next few months will see the Law Institute of Victoria, the regulatory body for the State's legal profession, abolished, and the powers of a replacement body to be severely curtailed. Page 1. -- Under a Victorian Government review of redundant and unclear legislation, the 1959 Hire Purchase Act faces the axe, much to the disappointment of farmers, small business and consumer groups. According to the Victorian Farmers' Federation, farmers would suffer without the cheap alternative to an overdraft, which incurs no establishment fee and no stamp duty. Page 3. -- Reuters Sydney Newsroom 61-2 9373-1800 2906 !GCAT **BIRTHDAYS** French inventor and pioneer of the hot air balloon JOSEPH MICHEL MONTGOLFIER was born in 1740. Bavarian-born husband of Queen VICTORIA, Prince ALBERT, was born in 1819. American radio and television pioneer LEE DE FOREST was born in 1873. He was responsible for more than 300 items of sound equipment, and he made the first radio news broadcast in 1916. Australian politician Sir JOHN LATHAM, who became the Chief Justice, was born in 1877. Ace Australian airman HARRY COBBY was born in 1894. He made his reputation during World War I and became known as the "imp of mischief" when he shot-down 29 enemy aircraft. Australian historian Lady ALEXANDRA HASLUCK was born in 1908. Her works included "Of Ladies Dead" and "Unwilling Emigrants". Australian psephologist MALCOLM MACKERRAS was born in 1939. He is credited with inventing the "election pendulum", which shows the possible electoral swing in one diagram. British showjumper MALCOLM PYRAH was born in 1941. **EVENTS** 1346 : English longbowmen under EDWARD III defeated PHILIP VI's French forces at the Battle of Crecy. 1789 : The French Assembly adopted the Declaration of the Rights of Man. 1883 : A massive eruption of a volcano on the island of Krakatoa in the Sundra Strait between Java and Sumatra began. The two-day eruption and associated tidal waves killed some 36,000 people and destroyed two-thirds of the island. 1920 : American women obtained the right to vote. The Nineteenth Amendment to the Constitution was ratified after a bitter debate in the Senate. The two million strong National American Woman Suffrage Association had been campaigning for equality since 1869. 1936 : The first high-definition television programmes were seen in Britain. The BBC transmitted from its studios at Alexandra Palace in London. 1952 : The Soviets announced the first successful Intercontinental Ballistic Missile (IBM) tests had been conducted. 1966 : The 200 Aborigines employed on a Northern Territory cattle station went on strike for full award wages. The Wave Hill employees were seeking a wage increase to $50 a week. They were being paid at a rate of between $5 to $10 a week, plus some food and board. The Arbitration Commission had decided earlier in the year that Aborigines should receive a wage of $23 a week, plus keep. 1968 : A British Professor of Pharmacology announced that heroin addiction was a "major emergency". 1970 : In the United States, a national women's strike caused chaos in New York. 1977 : Anti-uranium protestors clashed with police in Sydney. Prime Minister MALCOLM FRASER had just announced the government's decision to allow full-scale uranium mining. 1987 : A sex-crazed elephant in "urgent search for a mate" flattened a Bangkok radio centre and killed two people. 1987 : Hundreds of Neo-Nazis flocked to a German cemetery for the burial of HITLER's deputy RUDOLF HESS. The burial in the family grave was cancelled, after around 200 young people tried to force their way into the Wunsiedel cemetery. The crowd clashed with police and 90 people were arrested. The 93-year-old HESS had died in Berlin's Spandau prison nine days earlier. The HESS family disputed the assertion that HESS committed suicide by hanging himself. He had been in captvity for 46 years and was Spandau's last prisoner. 1989 : The Mini car celebrated its 30th birthday. (Compiled from ABC ARCHIVES, ABC RADIO NATIONAL, "On This Day" published by REED INTERNATIONAL BOOKS LIMITED, "The Chronicle Of The 20th Century" published by PENGUIN BOOKS and "Rock And Pop (Day By Day)" published by BLANDFORD BOOKS) -- Reuters Sydney Newsroom 61-2 9373-1800 2907 !GCAT (Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW The Australian Securities Commission will consider disciplinary actions against people involved in the Yannon share transaction and possibly a special report on Yannon for Treasurer Peter Costello. The moves could see those involved in the Yannon share transaction unable to hold company positions. Page 1. -- The National Competition Council yesterday detailed a new phase in national competition reform, by releasing guidelines for governments and business which explain access procedures for major infrastructure facilities. Page 2. -- Federal Treasurer Peter Costello and Small Business Minister Geoff Prosser have targeted fringe benefits tax as the Federal Government's next mark for tax reform. Costello will look at the entertainment rules first, which he sees as a nightmare, while Prosser has stated that while considering tax reforms, there will be no introduction of a goods and services tax in the first term. Page 3. -- The Australian Bureau of Statistics is developing a new quarterly labour costs index which will replace the traditional average weekly earnings statistics as the pre-eminent source of economic data on movements in wages. The index is expected to be published for the December quarter this year. Page 5. -- Foster's Brewing Group chief executive Ted Kunkel will today face the media over claims the group made a A$91 million profit from the deal that was at the heart of the National Crime Authority's investigation into former Foster's boss John Elliot. Page 19 -- Coal Operations of Australia Ltd managing director Tony Haraldson said yesterday the group, which is 96.3 percent owned by The AMP Society, plans to list in November after appointing ABN Amro Hoare Govett and J B Were as joint underwriters in an expected A$300 million float. Page 19. -- THE AUSTRALIAN In a crackdown on breaches of the Trade Practices Act that will concentrate on competition policy rather than pricing surveillance issues, the Australian Competition and Consumer Commission is intending to raise A$15 million in corporate fines. Page 17. -- Coles Myer Ltd chairman Nobby Clark said yesterday the company had been under pressure to strike a commercial settlement by August 30 with the parties involved in the controversial Yannon affair because of a looming legal deadline. Page 17. -- Energy ministers from the APEC region will meet in Sydney this week in what could be the first step in freeing up the Asia-Pacific energy markets and lifting regional investment in power generation. Federal Resources and Energy Minister Warwick Parer will chair the meeting and he believes the big challenge for the region is to ensure an adequate supply of energy, particularly electricity. Page 19. -- Tax experts believe the Australian Tax Office may have to extend a major change to sales tax collection measures for the computer industry to other industries in the wake of last week's Federal Budget. Treasury said in the budget that it would move to end sales tax fraud in the computer industry, a move that will save A$295 million over four years. Page 19. -- A survey by Melbourne-based mining consulting group Surbiton Associates Pty Ltd has shown Australian gold production increased 11 percent to a record 275.8 tonnes in the 12 months to June 30, and will rise again this year and the next. Page 19. -- BHP Minerals' 65 percent stake in the Syama gold mine in Mali could be open for tender, with South African mining house Randgold director David Ashworth saying his company had been invited by BHP to review the Syama open-pit project two months ago with a view to tendering a formal expression of interest. Page 19. -- THE SYDNEY MORNING HERALD Australian financial markets face a trying week, as post-Budget developments are tracked, key domestic economic data is released, and the weekend fall in United States bond prices is digested. Page 31. -- Federal Court documents have revealed County NatWest Securities Australia head Rob Thomas told Cambridge Gulf exploration deputy chairman Brian Conway to destroy evidence of a "free shares" deal, after he feared intervention by the Australian Securities Commission or the Australian Stock Exchange. Page 31. -- Coles Myer chairman Nobby Clark told yesterday's Business Sunday programme that the company would further rationalise its operations in response to tough trading conditions, and that the board was not thinking about splitting up the group. Page 31. -- Forestry group Auspine managing director Adrian de Bruin, along with other major shareholders in the company, has requisitioned an extraordinary meeting to ask the company's chairman Rod Hartley to step down. Auspine's shares were suspended from trading n Friday pending a response to stock exchange inquiries over the recent resignation of director Ron Bassett. Page 33. -- Businessman John Elliott may go beyond taking revenge on the National Crime Authority and the Victorian Director of Public Prosecutions, with several companies, including Foster's Brewing Group, the ABC, former Victorian Labor Minister Steve Crabb and fromer Elders IXL directors Peter Bartels and Nobby Clark, in his firing line. Page 33. -- A supermarket price war in South Australia has left supermarket groups on red alert in the event the cost cutting exercise spreads to other states. National number three company Franklins has aggressively slashed prices in its South Australian stores yet its main competitors Woolworths and Coles Myer have said there has been little impact on their sales. Page 33. -- THE AGE South Korean car manufacturing giant Hyundai has signalled it will not invest in Australia because of the move to zero tariffs. Hyundai's International Business Division director Ki-Young Hong said Australia's move towards zero tariffs and its emphasis on free market policies was baffling. Page C1. -- Coles Myer retail group chairman Nobby Clark has indicated the KMart variety business is still 18 months away from showing any signs of improvement, and he warned of more rationalisation for Coles Myer divisions, with the group executive still to make a dEcision about World 4 Kids, one of its biggest problems. Page C1. -- Roger Dedman's art index, the most detailed account of art-market movements in Australia, has correctly predicted a boom in Australia's art market. Dedman is confident the boom, which began in April, will continue to gain momentum as more than 2000 paintngs went under the hammer last week. Page C1. -- According to documents lodged with the Federal Court, fears that the Australian Securities Commission or the Australian Stock Exchange were inquiring into a share deal prompted County NatWest Securities Australia head Rob Thomas to instruct Cambridge Gulf Exploration deputy chairman Brian Conway to destroy evidence of a "free shares" deal. Page C3. -- Paint group Wattyl claimed that consumers were the losers after the Australian Competition and Consumer Commission repeatedly rejected Wattyl as a suitor for Taubmans. Taubmans was sold to the South African-based Barlow group for less than Wattyl's original offer last week. Page C3. -- Battle Mountain Gold (Australia) director Keith McKay told the Gold Coast Gold Conference that the Vera-Nancy gold deposit in northern Queensland was ready to start full production within 12 months, producing 216,000 tonnes of ore a year and 92,000 ounces of gold a year. Page C3. -- Reuters Sydney newsroom 61-2 9373-1800 2908 !GCAT NEW ZEALAND HERALD Front Page - Prison on boil over filming - Old heroes cheer loudest as All Blacks win - Caltex feels lonely after petrol price rise Editorial - Students astir - again Business - Britain's economic path arrives at Crossroads - China becoming chief scourge of US trade - Lloyds renewal plan gets early US appeal date - Internet clutters phone system Sport - Brooke admits nearly blowing series victory - Ridge flair aids Warriors' chances THE DOMINION Front page - Army kills horses to save children' - Workload blamed for fall in principals - All Black veterans cry with joy at historic win Business - Brierley tipped as Coles Myer buyer - Tradenz helps form food industry group - Ceramco chief takes break - NZ light Leathers profit rises 274pc Sport - Jones the greatest, says Hart - Lavish praise for Preston - Thoughts turn to Ranfurly Shield defence THE PRESS Front page - All Blacks make history - Army kills 13 wild horses Editorial - Getting rid of gangs Business - London at record highs as European rates fall - Hawkins may escape fraud trial in Aust - Ceramco chief may go at year end Sport - Blood sweat and tears of joy for NZ - Jones and Culhane in doubt - Twose takes 12 months off - New NZ cricket coach Rixon arrives 2909 !C31 !CCAT !E51 !E512 !ECAT !G15 !G158 !GCAT Washington has agreed to join Canberra in protesting over European gluten dumping that has cut Australian exports and driven prices down, Australia said on Sunday. Australian Primary Industries Minister John Anderson said he had raised concerns over gluten dumping in the United States by European Union countries during weekend talks with U.S. Agriculture Secretary Dan Glickman in Washington. Glickman said Washington would join Australia in raising the issue with the union before a U.S.-EU meeting in Brussels next month, Anderson said in a statement. "I am delighted he agreed with our approach and he clearly recognises the problems being inflicted on Australian gluten exports by the EU's actions," Anderson said. "The U.S. and Australia will send a joint delegation to meet the EU before the U.S.-EU consultations in Brussels next month, which will present the strongest possible case for a change to the EU's starch-gluten regime." The dumping had seen Australian gluten export prices tumble to A$1,600 a tonne from A$2,400 over the past year, said Anderson, who is visiting the United States. "All Australian companies are being affected by the cut-price EU competition, but the Manildra Group is the hardest hit, and has been forced to close starch-gluten plants in Australia and the U.S.," he said. -- Canberra bureau 61-6 273-2730 2910 !GCAT !GCRIM !GPOL Australian opposition leader Kim Beazley said on Sunday he was not seeking legal action over the defection of a Labor senator that has muddied the balance of power in the upper house Senate. But Beazley told Nine Network television Senator Mal Colston's decision to quit the Labor party and serve out his term as an independent complicated parliament. "It's put a question mark, obviously, a new question mark over all legislative processes ... it's a most unlovely performance," he said. Melbourne's The Sunday Age newspaper reported on Sunday Labor was considering pushing for a police investigation into whether Colston had broken the law if he had quit Labor and pledged support for government legislation in return for a prestigious Senate post. Colston announced his resignation from the Labor Party last week, freeing him from voting in line with Labor policy in the Senate, where the Liberal-National government does not have a majority. Prime Minister John Howard's conservative government needs the support of at least two non-government senators and there has been strong speculation Colston agreed to back key government reforms in return for government backing for his successful bid for the Senate deputy presidency. Colston has not commented in detail on his likely voting pattern, saying only he would be guided by his Labor principles and by the government's mandate to implement certain policies. Asked about the possibility of legal action, Beazley said: "No, I think that's over the top." Beazley also said the government's planned charter of budget honesty, requiring updated Treasury economic and fiscal forcasts to be released ahead of an election, would delay detailed policy announcements until weeks before polling day. "What it will do in terms of debate is put opposition and government in a position whereby they'd be most foolish to announce their fully-costed and definite plans for the next three-year period until that final release of estimates is down," Beazley said. -- Canberra bureau 61-6 273-2730 2911 !GCAT NIHON KEIZAI SHIMBUN: The Construction Ministry and Post Ministry, in cooperation with Nippon Telegraph and Telephone Corp (NTT) and other firms, plan to test a new large-capacity optical fibre telecommunications network from September. ------- Fujitsu Ltd has decided to shut down part of a production line for static random access memory (SRAM) microchips at its plant in Iwate prefecture, northern Japan, within this fiscal year ending March 31. ------- Fuji Bank Ltd will start offering consulting services for pension fund management this fiscal year. Dai-Ichi Kangyo Bank Ltd (DKB) and Sanwa Bank Ltd are also considering launching similar services. 2912 !GCAT !GDIP !GPOL A Hong Kong pro-democracy politician on Sunday called for the establishment of an appeals body to deal with complaints over the selection of Hong Kong's first chief executive after the 1997 handover to China. A different group should administer, monitor and handle complaints related to the selection of the chief executive, Frederick Fung, chairman of the Association for Democracy and People's Livelihood, said on government radio. "There's an inclination to have a secretariat take care of the operational details," Fung said. "While we support the idea of having the board of directors to be the referee of the important event, we would like to see an independent body appointed by the Preparatory Committee to be their appeal committee," he said. After more than 150 years as a British colony, Hong Kong reverts to China at midnight on June 30, 1997. The territory's first post-handover chief executive is expected to be chosen in November. Fung is a member of the China-handpicked Preparatory Committee overseeing the formation of a 400-member selection committee which will choose the chief executive and form a provisional legislature that replaces the elected chamber. The crucial months ahead hold promise of drama, and some outspoken politicians have charged that Beijing has already decided who the future chief executive would be. Shipping magnate Tung Chee-hwa has been widely tipped as the favoured candidate, with even his colleages in the Preparatory Committee endorsing him publicly. But a senior China official denied that the matter had been already decided. "The chief executive must be selected by the Selection Committee, just like the make-up of the provisional legislature ...there is no possibility of it being internally decided," said Zhang Junsheng, vice-director of the Hong Kong branch of Xinhua, China's de facto embassy, at a public function. The nomination process for the Selection Committee, which will be formed in October, has thrown Hong Kong's pro-democracy camp into a quandary, especially after Beijing's unexpected gesture last week of inviting democrats on board. The populist Democratic Party has long rejected the idea of joining the committee as it would amount to recognising the provisional legislature which the party regards as illegal. The party argues China's plan to scrap the present elected legislature and appoint a new "provisional" one for the handover has no basis in law or in handover treaties with London. Pressure mounted when a poll conducted by the party revealed that more than half the respondents wanted the party to have representation on the transition body. The party's posture has drawn criticism from a rival party. "It is unacceptable for these people to want to continue to play the game of confrontation, which is to the detriment of Hong Kong," Allen Lee, leader of pro-business Liberal Party and member on the Preparatory Committee, said. 2913 !GCAT !GPOL !GVIO A peace pact ending a 24-year Moslem rebellion in the southern Philippines is expected to be signed in Jakarta on August 30 followed by a ceremonial signing in Manila on September 2, President Fidel Ramos said on Sunday. The presidential palace said Ramos had invited Hamid Algabid, secretary general of the Organisation of the Islamic Conference (OIC), to be a signatory to the accord. An OIC panel chaired by Indonesia is mediating the talks between Manila and the insurgent Moro National Liberation Front (MNLF). The signing of the agreement will take place after a final round of talks in the Indonesian capital, a palace statement said. The agreement calls for the setting up of an administrative council in 14 provinces in the southern Mindanao region as a precursor to a Moslem regional autonomous government the MNLF is demanding as a condition for ending the rebellion. Manila's recent announcement of its agreement to install a rebel-led council has sparked widespread protests among Christian residents of Mindanao. The country's six million Moslems regard the southern region as their ancestral homeland although they have become a minority in the area after decades of Christian migration. "We are confident that a smooth process of finalisation will ensue in Jakarta and our government panel looks forward to your Excellency's indspensable presence in the initialling ceremony (in Jakarta)," Ramos said in his letter to Algabid. "We look forward to your Excellency's kind acceptance of our invitation to the signing of the final peace agrement to be held at Malacanang (presidential) palace, Manila, on September 2," according to the letter, excerpts of which were released by the palace. Ramos thanked Algabid for his help in drawing up the peace agreement. More than 125,000 people, mostly civilians, have died in the rebellion which broke out in October 1972 after then president Ferdinand Marcos declared martial law. 2914 !GCAT !GCRIM The south Korean captain of a fishing boat and 11 other seamen have been killed in an apparent mutiny in the South Pacific by Chinese crewmembers, Korean police said on Sunday. A Korean maritime police officer said by telephone from the port of Pusan that the mutineers, ethnic Koreans from China, apparently revolted over harsh working conditions. He said all bodies were dumped overboard and the Honduras-registered vessel was found by a Japanese martime patrol craft drifing without fuel south of Japan early on Sunday morning. There had been no contact with the vessel since August 3. Citing Japanese maritime police, he said six Chinese-Korean sailors, six Indonesians and one Korean were on board the vessel when it was found. Captain Choi Ki-taek, six other Koreans, four Indonesians and one Chinese-Korean perished in the mutiny that occured as the tuna fishing vessel was sailing towards the South Pacific island of Samoa. He said there was no official explanation of how the killing occurred. Japanese maritime police were not immediately available for comment. South Korea's Yonhap news agency said the 254 gross tons Pescarmar No. 15 was operated by the Korean fishing company, Daehyun, for Omani owners. Korean employers around Asia have earned a reputation for tough, and at times brutal, management of their workers, leading to industrial disputes everywhere from Vietnam to China. South Korea's deep sea fishing fleet has been forced to employ increasing numbers of overseas crew as Koreans spurn low wage jobs as deck hands. The maritime police officer said the mutiny apparently broke out sometime after August 3 when the captain radioed to say he was heading for Samoa to replace rebellious crewmembers. "The captain of the boat reported fishing was not possible as ethnic Koreans refused to work and so he was sailing towards the Samoa base," he said. "Mutiny seems to have followed immediately because all communication was cut off after that." After the mutiny the boat headed for China, he added. An official of South Korea's Maritime Affairs Ministry said Japanese maritime police would investigate the incident because the boat was found in Japanese territorial waters. Seoul initially demanded the boat be sent to South Korea. The officer said a Japanese vessel on Saturday picked up a distress signal from the stricken boat. An official with South Korea's Jeyang Co Ltd, which recruited the crew for the ill-fated vessel, said the ship sailed from Pusan on June 7. 2915 !GCAT !GCRIM Hong Kong police on Sunday arrested a Portuguese man and are hunting for another European male in connection with the killing of a Filipina in the territory. The 24-year-old Hong Kong-born Portuguese, whom police declined to name, was seen by a patrolling officer stabbing the Filipina in a Central district lane early on Sunday morning and was arrested after a chase, a police spokesman said. The 25-year-old murder victim, whom police also refused to identify, suffered injuries to her neck and head. She was rushed to hospital but certified dead on arrival. 2916 !GCAT !GCRIM !GPOL !GVIO Two Thai border policemen were seriously wounded on Sunday when members of a Burmese rebel splinter faction ambushed their patrol in northwest Thailand, security officers said. The two were wounded in the early hours of Sunday when some 30 members of the Democratic Karen Buddhist Army (DKBA) ambushed their patrol on the Thai side of the border with Burma, to the north of the town of Mae Sot. The Thai army commander in the area, Col Suvit Maenmuan, told reporters the DKBA, which is allied with the Rangoon military government and based in southeast Burma, had recently stepped up cross-border infiltration. Suvit said the motive for their intrusions was not clear but he had ordered reinforcements to beef up security along the porous frontier. The DKBA was formed in late 1994 by hundreds of guerrillas who split from the anti-Rangoon Karen National Union (KNU) and allied themselves with Burmese government army, their former enemies. DKBA members have since launched intermittent cross-border attacks on Karen refugee camps in Thailand, where the majority of inhabitants are KNU supporters, and on Thai villages and police posts near the border. Bangkok has complained to Rangoon about the raids but Burmese military authorities say they have no contol over the faction. Thai army commanders reject the explanation, saying they have evidence the Burmese army supplies and directs the renegade ethnic minority splinter faction. 2917 !C13 !CCAT !GCAT !GHEA Asia, home to some of the world's heaviest smokers, is attempting to stamp out the habit by introducing new rules similar to those recently announced in the United States targeting young people. A ban on tobacco advertising is being sought in China by 2000, an Australian state is set to fight under-age smoking with new laws while Singapore occasionaly rounds up underage smokers. Japan is beginning to acknowledge non-smokers' rights but smokers in India continue to puff away. President Bill Clinton, expanding the federal role in fighting teen smoking, on Friday took on powerful U.S. tobacco interests and announced strict rules to control tobacco sales and advertising -- including proof of age to buy cigarettes. Under the new rules, vending machines that sell cigarettes would be banned from places teenagers can go, and billboards advertising cigarettes would be prohibited within 1,000 feet (300 metres) of schools and playgrounds. Sales or giveaways of products like caps or gym bags that carry cigarette or smokeless tobacco product brand names or logos would also be prohibited. China recently mounted a drive to curb the growth of its 300 million-strong army of smokers, estimated to be expanding by two percent a year, but health campaigners say the importance of tobacco tax revenues makes progress difficult. In January this year, health officials launched a campaign to ban tobacco advertising by 2000. A law launched in February 1995 banned tobacco advertising in many public places, including sports stadiums, but cigarette company sponsorship of sporting events has survived the advertising law. By May this year, 30 Chinese cities had banned smoking in public places such as hospitals, libraries and stadia, but so far the restrictions appear to have had little effect. In Beijing, the fine for people who violate the ban is just 10 yuan ($1.20) -- less than the price of a packet of foreign cigarettes -- and enforcement is the responsibility of volunteers and not the police. The environment is quite different in Singapore, however, which continues to strictly enforce some of the world's most Draconian anti-smoking legislation. The city-state launched its first anti-smoking measures in 1970 and since then has gradually toughened up the rules against the promotion and consumption of tobacco. Over the last few years it has barred smoking in government buildings, restaurants, department stores, public lifts, taxis, busses, air-conditioned offices on factory floors and even in its outdoor National Stadium. Offenders can face fines of Singapore $1,000 (US$709). Singapore bans smoking by those under 18 in public places and police have gone on several highly-publicised round-ups of teenagers smoking in parks and other youth hang-outs. Meanwhile Japan, fairly liberal in its attitude towards tobacco smoking, has only recently started to acknowledge the rights of non-smokers. About 36.3 percent of 11,256 Japanese surveyed in 1995 said they smoke. Offices, particularly in major business centres such as Tokyo, have designated separate places for smoking, and some railways have a separate smoking corner on the platforms. Australia has required health warnings on cigarette packets since 1972 and bans most forms of tobacco advertising -- print and broadcast media, cinemas, billboards and most sporting sponsorships. The minimum age varies between states from 16 to 18 but the most populus state, New South Wales, is set to introduce legislation requiring proof of age to be shown when buying tobacco from October 1. In India, tobacco advertisements are banned on state-run television and radio but not in independent media though several publications have voluntarily banned tobacco ads. Advertisers increasingly sponsor sporting events to indirectly gain more mileage in popular audio-visual media. India's biggest cigarette maker ITC Ltd sponsored this year's World Cup cricket in the subcontinent, but attracted protests. But there is no organised or commonplace social opposition to smoking in public, except often-ignored notices on railway coaches asking smokers to have concern for fellow passengers. 2918 !GCAT !GCRIM A senior Macau police officer and bomb expert denied on Sunday that he was behind a wave of bombings in the territory and claimed explosives found in his home were merely teaching materials. The officer, who was not named by police and declined to be identified, told reporters he was taken in by police on Friday and interrogated about the bombings but was later released. He said explosive devices found in his flat were only used as material for lectures to other officers. The officer, in his 30s, was arrested after several months of undercover investigations, police sources said. Macau, a Portuguese-administered territory near Hong Kong which reverts to Chinese rule in 1999, has been hit by 12 bomb attacks since December 1995, injuring eight people. The most recent, on August 9, blew up outside a karaoke bar and former Thai gigolo club, shattering nearby windows and damaging six parked cars. Police say the such blasts are favourite warning signals among criminal gangs in financial disputes. 2919 !GCAT !GPOL !GVIO King Norodom Sihanouk said he supported a proposed mass amnesty, a royal palace official said on Sunday, fuelling speculation that the notorious leader of a breakaway faction of the Khmer Rouge would be pardoned. An official at the royal palace said on Sunday that the king fully supported a suggestion to declare a mass pardon on his 74th birthday on October 31. "I have received a letter of request to grant amnesty on the occasion of my birthday," the palace official said, quoting a letter from the king to Cambodia's most senior Buddhist monk. "I would like to express my support 100 percent for this request," the letter said. Sihanouk did not say who might be included in the amnesty but there have been suggestions from government leaders that Ieng Sary, the former Khmer Rouge number two, be forgiven for his part in atrocities committed during the 1975-79 Khmer Rouge reign of terror. More than a million Cambodians died of starvation, disease or overwork on mass labour camps, or were executed as enemies of the Maoist-style revolution. Ieng Sary, sentenced to death in absentia for his role in the killings, now heads a dissident Khmer Rouge faction which earlier this month rejected what it called the hardline rulers under paramount chief Pol Pot and vowed to make peace with the government. The surprise split in the guerrilla group has led to hopes that more rebel units might opt for peace and Cambodia's long guerrilla war might draw to a close. But the peace talks with the Khmer Rouge dissidents have also given rise to a questions as to the fate of top Khmer Rouge leaders held responsible for the "killing files" atrocities, among them Ieng Sary. Co-premier Hun Sen announced soon after the split in the Khmer Rouge became known that Ieng Sary would be protected. First Prime Minister Prince Norodom Ranariddh later said that it was up to parliament to decide if Khmer Rouge leaders should be pardoned and last week Ranariddh said the government would ask the national assembly to scrap a 1994 law banning the guerrilla group. Sihanouk, Ranariddh and Hun Sen once worked with the Khmer Rouge and the king is said to have developed an intense dislike for Ieng Sary. A Cambodian government team travelled to a remote corner of the country on Sunday to discuss in detail the demands of the breakaway faction negotiating for peace. The government team, led by armed forces deputy chief of staff, General Nhek Bun Chhay, returned to the northwestern town of Poipet on the Thai border late on Sunday from several hours of talks in Phnom Malai, one of two key rebel base areas controlled by the dissidents. "It was an informal meeting," team member Long Sarin, a senior official based at the Cambodian embassy in Bangkok, told Reuters in Poipet. "We haven't reached an agreement but the meeting went well. We understood each other," he said. Long Sarin declined to go into details of the talks but said Ieng Sary's son, Ieng Savuth, represented his father. More talks would be held soon, he said. The Khmer Rouge dominated a guerrilla alliance which included royalist forces which battled a Vietnamsese army of occupation, and the Hanoi-backed government in Phnom Penh during the 1980s. All sides in the Cambodian war signed an international peace treaty in 1991 but the Khmer Rouge later pulled out of the peace process and rejected United Nations-run elections in 1993. 2920 !GCAT !GPRO !GREL Filipino Roman Catholic nuns offered a day of prayers on Sunday for the recovery of Mother Teresa, the Nobel peace laureate now fighting for her life in a Calcutta hospital. "We have asked all the houses of our congregation across the country to pray for her," said Sister Stephanos of the Philippine branch of the Missionaries of Charity, the religous order Mother Teresa founded 47 years ago to help the poor. The Philippine branch has about 150 nuns scattered in different parts of this predominantly Catholic country. Special prayers for Mother Teresa were also offered in masses around the capital Manila, said Sister Stephanos, who runs a charity house for the dying. Patients at the charity home, including those terminally ill with cancer, joined the nuns in praying for Mother Teresa at a Sunday morning mass, she said. Mother Teresa, 85, was admitted to a Calcutta hospital on Tuesday with malarial fever and severe vomiting. She is conscious but in grave condition, a hospital official said on Sunday. A problem with her heart is under control but the heart remains vulnerable, he said. The 85-year-old nun remained on a respirator in intensive care and was still being fed intravenously. 2921 !GCAT !GHEA An estimated 32,000 Singaporeans hopped, skipped and jumped in time to music on Sunday in a mass outdoor aerobic workout designed to encourage the nation to keep fit. Dressed in red and white clothing, the colours of the national flag, the participants, including Prime Minister Goh Chok Tong and several members of his cabinet, then took part in a 3.3 km (two-mile) walk. Officials said the "Great Singapore Workout", which has been held annually since 1993, attracted far more participants than in previous years. State television estimated the total attendance at around 32,000. A similar event in 1995 broke the World Guiness record for the largest aerobics/gymnastics display with 30,517 participants. Goh told reporters after the workout he had been pleased by the large number of young people taking part. "The youths are coming out. They are setting the lead and they (will) then acquire the habit of exercising, of coming into the open and enjoying the fresh air and sun," he said. "We want to encourage them." The director of the Ministry of Health's "Healthy Lifestyle Unit", K. Vijaya who organised the workout, said such events had helped improve the fitness of Singaporeans. She told Reuters the number of Singaporeans doing some sort of regular exercise had increased and the level of obesity in children had fallen since the annual workouts were first organised. 2922 !GCAT !GDIP Most Taiwanese support Vice-President Lien Chan's secretive visit to Ukraine last week even though the move infuriated neighbouring Beijing, a poll published on Sunday showed. The survey, carried out by the mass circulation China Times newspaper on August 23, said 60 percent of 848 people interviewed supported Lien's Kiev mission in a trip respondents saw as worth risking China's ire. Only 10.6 percent said they did not support the visit. Some 46 percent said Lien's visit had a positive impact on raising Taiwan's international status, against 5.4 percent who disagreed. Lien, who returned to Taiwan late on Thursday after his three-day trip to Ukraine, has said he spoke to people "of all levels" in the former Soviet bloc nation but declined to say if he met President Leonid Kuchma. Ukraine, bearing the brunt of China's anger, flatly denied Lien and Kuchma met, although Foreign Minister Hennady Udovenko told Reuters he found Beijing's furious reaction to Lien's visit "out of proportion". China, which regards Taiwan as a renegade province, delivered a note of protest to Ukraine's ambassador in Beijing and cancelled a visit by a high-level delegation. Beijing says Taiwan is not entitled to foreign ties and has growled at allies it sees as giving political or diplomatic support to the island's leaders. Lien surfaced in Kiev on Tuesday, two days after vanishing in New York after a state visit to the Dominican Republic, one of just 30 countries in the world which recognise the island instead of China. 2923 !GCAT !GPOL !GVOTE Singapore prime minister Goh Chok Tong on Sunday quashed speculation of an early general election in the city-state, saying there would be no polls before the end of October. "I am in no hurry," he told a news conference. Asked by journalists about comments he was reported to have made at a National Day dinner on Saturday evening, Goh confirmed saying he now only had four possible "windows" for the elections, all of them after October. "I was as clear as I could (be) last night. That is that you can go on leave in October. I mentioned there were four windows left, any one of them I think I would be happy with," he said. In July, Goh said there were five windows in which the election could be held: September, November, December, during the Chinese Lunar New Year in February 1997 and after the budget debate in March. There is no legal requirement to elect a new parliament until April 1997, but Goh's unbeaten People's Action Party (PAP) usually calls elections long before they are due. Goh hinted he may wait until the last possible moment to hold elections. "If you remember back in 1991, I said I would go the full term and people seem to have forgotten that -- and full-term means a good five years," he said, adding, "If I feel the time is right, then I will call the election." Speculation over the exact date of the election has been mounting since Goh's announcement on August 18 that the election would be "soon". But a recent spate of poor economic news has encouraged some economists to suggest the polls may be postponed. Two weeks ago, Singapore announced a sharp decline in its economic growth in the second quarter, to seven percent from 10.9 percent a year ago, which officials said was due to a slump in its key electronics market. As a result, most economists have cut their growth forecasts for the third quarter and many suggest a real turnaround may not occur until the beginning of 1997. Commenting on the economic slowdown, Goh said he was cautiously optimistic. "The downturn is felt in the electronics industry, which of course then would have some influence on maybe the financial sector," he said. "It is difficult to say how long it will last. The downturn has come very suddenly and more sharply than people expected. We are dealing with a very volatile industry. Three months, six months, that is possible." 2924 !GCAT !GCRIM !GPOL A Seoul court is expected to deliver a verdict and pass sentence on Monday on former South Korean presidents Chun Doo Hwan and Roh Tae-woo on charges of treason, mutiny and corruption. Prosecutors have demanded death for Chun and life in jail for Roh. Sentencing will be divided into three parts. First, for Chun, Roh and 14 former military associates on charges of mutiny and treason. Second, for Roh, nine business tycoons and five former top officials on charges of corruption. Third, for Chun and four former officials for corruption. The following is a chronology of major events leading up to what has been billed in South Korea the "trial of the century". Oct 19, 1995 - Opposition lawmaker Park Key-dong drops bombshell in parliament by saying Roh amassed 400 billion won ($492 million) while in office from 1988-93. Oct 27 - Roh tearful confesses he secretly amassed a slush fund totalling 500 billion won. Nov 1 - Prosecutors start grilling Roh, the first South Korean president serving or retired to face legal questioning. Nov 16 - Roh is arrested and held on charges of taking bribes from business tycoons. Nov 24 - President Kim Young-sam orders his ruling party to draft a special law to punish his two predecessors for abuses. Nov 30 - Prosecutors form team to reopen investigation into a 1979 coup and 1980 army massacre of pro-democracy protesters in the southern city of Kwangju. Dec 1 - Chun rejects prosecution summons to appear for questioning and the following day heads for his hometown after holding a defiant news conference to accuse President Kim of political witchhunt. Dec 3 - Chun is arrested on charges of masterminding the 1979 putsch and brought back to Seoul where he is detained in Anyang Prison. He begins a hunger strike. Dec 5 - Roh is charged with accepting bribes from business tycoons. Prosecutors also indict nine business tycoons but they are not detained. Dec 9 - Seoul prosecutors probe into Chun's slush fund. Dec 18 - Corruption trial starts for Roh, nine business moguls and five former top officials. Dec 21 - Chun and Roh are formally indicted on mutiny charges for their major roles in the 1979 coup. Dec 29 - Chun ends fasting. Jan 12, 1996 - Chun is charged with accepting bribes. Jan 22 - Prosecutors indict Chun and Roh on treason charges over the Kwangju massacre. Feb 26 - Chun appears in court to answer bribery charges. Feb 28 - Prosecutors wind up a three-month probe into the coup and the army massacre. March 11 - Hearing begins on mutiny and treason charges against Chun and Roh. June 29 - Prosecutors demand jail sentences for nine tycoons on trial with Roh for corruption, including chairmen of Samsung and Daewoo groups, and the five others. Aug 5 - Prosecutors ask court to sentence Chun to death and Roh to life in prison. Jail terms of between 10 years and life sought for the 14 former officers. 2925 !GCAT !GCRIM !GDEF China plans to make military trials more open as part of a reform of court procedures within the People's Liberation Army, the Liberation Army Daily said on Sunday. The newspaper said trials would be brought closer in line with criminal procedures in civilian courts, with more responsibility given to both the prosecution and defence in presenting evidence. Pilot reforms had already begun in army and air force units in Chengdu in southwest China and Shenyang in the northeast. The changes were set to be implemented nationally by the end of next year. The changes would ensure the fairness of trials, the newspaper said without elaborating. Military and civilian court procedures in China are secretive. Defendants are usually given little opportunity to prepare their cases and appeals rarely overturn preliminary decisions. 2926 !GCAT !GCRIM !GPOL !GVIO A Seoul court is expected to sentence former president's Chun Doo Hwan and Roh Tae-woo on Monday on charges of mutiny, treason and corruption. Following are brief profiles of Chun and Roh: CHUN DOO HWAN (Born January 18, 1931) More than 16 years after a military coup that ushered him into the presidential mansion, the former army general is best known for a regime tainted by brutality. Depite political repression, Chun's eight-year iron rule was also marked by economic prosperity. State prosecutors said Chun mastermined a 1979 coup and a 1980 army massacre of pro-democracy demonstrators in Kwangju, an event that still traumatises the nation. More than 200 people were killed by official count. The aloof, ramrod-straight Chun defended his actions as necessary to save the nation from a crisis, saying North Korea contemplated invading the South after the assassination of president Park Chung-hee in October 1979. "I am sure that I would take the same action, if the same situation arose," said Chun. He also denied sending troops into Kwangju, saying he was not in the chain of command. Chun has lived a beleaguered existence since 1988 when he was forced to make a public apology for his own and his family's misdeeds, give up his wealth and go into exile at a Buddhist temple, accompanied only by his wife. ROH TAE-WOO (Born on December 4, 1932) The son of a poor farmer, Roh rose to be an army general and the first democratically-elected president in three decades. But greed -- he tearfully confessed to amassing a 500 billion won (about $600 million) slush fund by twisting the arms of business tycoons -- proved his ultimate undoing. A hero of South Korean forces in the Vietnam War, the much decorated Roh backed Chun, his classmate in the Military Academy, in a 1979 coup. Roh rejected an offer to be rubber-stamped in office by Chun and announced in a dramatic 1987 address a popular vote for the presidency, calming student-led insurrection calling for an end to strongman rule. Publicly, Roh was a suave ambassador of Korea Inc, an Asian success story that rose from the ashes of World War Two and the Korean War to become the world's 11th largest economy. His moment of greatest glory came when he presided over the 1988 Seoul Olympics. Roh broke Seoul's Cold War diplomatic shackles by forging ties with the former Soviet Union, Eastern Bloc countries and China. But foreign success was undermined by domestic unrest that rocked his administration. Factory workers freed from authoritarian controls turned restless, and then violent. Labour disputes halted production of cars, ships and steel. South Koreans lost confidence in themselves, and in their president. Two weeks before he left office, Koreans rated Roh the worst politician in the country in an opinion poll. 2927 !E21 !E211 !ECAT !GCAT !GCRIM China is stepping up its struggle against tax cheats and fradulent expense accounts with new receipts that will make forgeries more difficult, official media said on Sunday. The State General Administration of Taxation would start requiring businesses to install computer equipment to issue value-added tax (VAT) receipts for transactions over 100,000 yuan, the Business Weekly said. The computer system has been used since January for receipts of more than one million yuan and this has made forgeries more difficult, the newspaper said. China had lost billions of yuan in tax revenue to forged receipts since a new tax code was adopted in 1994, the newspaper said. China's VAT is 17 percent. Tax authorities would also issue a new style of receipt for smaller transactions using anti-forgery markings. It has also ordered inspections of printing shops to try to crack down on counterfeiting of receipts, the Economic Information Daily said. The new receipts would be used nationwide from January next year, the newspaper said without giving further details. Many officials and businessmen inflate their expense accounts by buying forged receipts. ($1 = 8.3 yuan) 2928 !GCAT !GCRIM !GPOL After a trial that dug up the dirtiest secrets of South Korea's former military strongmen, a court on Monday is expected to sentence one-time president Chun Doo Hwan and his successor Roh Tae-woo. State prosecutors have demanded death for Chun and life in jail for Roh on charges of treason, mutiny and corruption. Few South Koreans, however, will be holding their breath for the outcome. Guilty verdicts are widely considered a foregone conclusion, but regardless of the sentencing the two former military generals are expected to be offered clemency by current president Kim Young-sam. Moon Chung-in, a professor of politics at Yonsei University, said there was "zero possibility" of any death sentence being carried out. "By carrying out the death sentence, nobody will gain," he said. "Kim Young-sam would be shown to have an iron fist and no human heart." Moon said it was more likely that Kim would grant clemency before he steps down next year. That would mollify the rightwing of his ruling party whose support he needs to help pick his presidential successor. Chun and Roh are expected to appeal any sentence by the Seoul District Criminal Court. A three-judge panel will also pass judgmnt on former military associates of Chun and Roh and senior officials who served during their administrations. Also in court will be a line-up of South Korea's top business tycoons, including the chairmen of the mighty Samsung and Daewoo groups, charged with buying business favours by showering Chun and Roh with cash. Most Koreans believe the tycoons will get off with the equivalent of a rap across the knuckles because of their key role in the economy. Cameras will be removed from the court during their sentencing in a move commentators say is to protect their overseas corporate image. The businessmen have admitted paying off the presidential Blue House, saying it was common practice at the time, but deny they received favours in return. Treason and mutiny charges stem from a 1979 coup that propelled then military general Chun to power and a massacre in 1980 in the southwestern city of Kwangju when troops crushed an uprising against martial law. Hundreds of civilians were killed, according to official accounts, although survivors say the death toll was higher. The lengthy trial first electrified, then bored South Koreans when it became clear that the evidence would not drag in President Kim, whose campaign to "right the wrongs of history" lay behind the prosecution and who denied ever taking tainted money. Koreans were gripped by initial images of the two ex-presidents stripped of their dignity in pale blue prison smocks and plastic slippers like common criminals. Roh, the suave former statesman who presided triumphantly over the 1988 Seoul Olympics, and the ramrod straight Chun gave little away under cross examination, frequently saying "I don't know" or "I can't remember". Prosecutors tried to prove that military action that launched Chun's political career was illegal and sought to piece together the events that led to the Kwangju tragedy, which still haunts the nation. Chun defended his seizure of power by saying it prevented turmoil that would have invited attack from North Korea after the assasination of president Park Chung Hee. He denied giving the order to open fire to crack paratroopers who stormed Kwangju. Prosecutors exposed breathtaking corruption as tycoons detailed how they toted sackloads of cash to the Blue House in deals brokered by presidential aides. Roh has confessed to amassing a 500 billion won (around $600 million) slush fund in his 1988-93 term in office, while prosecutors allege Chun built a hidden fortune of 700 billion won (about $850 million) during his 1980-88 tenure. 2929 !GCAT !GDIP !GPOL !GVIO North Korea said on Sunday the health of two South Korean students, on the fifth day of a hunger strike for the release of students detained in Seoul for supporting reunification, is deteriorating. The official Korean Central News Agency (KCNA), which has named the students as Ryu Se Hong and To Jong Hwa, said doctors were concerned about how the pair were coping without food. The students started their fast on Wednesday on the north side of the border town of Panmunjom where they were attending functions supporting reunification of communist North Korea and capitalist South Korea, divided since the end of World War Two. North and South Korea have been technically at war since their 1950-53 conflict ended with a truce. "Medical workers stationed at the Thongil House in Panmunjom today expressed deep concern over the health conditions of Ryu Se Hong and To Jong Hwa...," KCNA said in a report monitored in Tokyo. "Especially, Ryu Se Hong has become conspicuously lean and weak, a doctor said, expressing doubt about how long he can withstand in future," KCNA said. About 3,225 students were arrested in South Korea last week after riot police stormed Seoul's Yonsei University, smashing through burning barricades of desks and chairs and lobbing stun grenades to dislodge mostly female undergraduates. KCNA has said that prior to starting their hunger strike the two students vowed to risk their lives in protesting South Korea's action in breaking up the rally for reunification and press coverage of the incident. "They (the two students) noted they would start a hunger strike for an indefinite period, unable to repress their resentment and rancour at the attitude of the authorities and the reptile press," KCNA said last Wednesday. North Korea wants reunification of the peninsula under a co-federal system where both countries retain their political and economic systems, while South Korea wants a single government and economic system. North Korea-watchers in Tokyo have said Pyongyang is likely to milk as much propoganda value as possible from the South's student unrest to divert attention from its own woes caused by disastrous floods which have caused widespread famine. 2930 !GCAT !GVIO Indonesian kidnappers holding 12 forestry workers in remote Irian Jaya province are rebels following orders, the official Antara news agency said on Sunday. Antara quoted the head of the local military district Colonel Frans de Wanna as saying documents were found in a bag of one kidnapper killed last week by soldiers which showed he had been given task of robbing the workers. "We can make the confirmation based on documents in a bag carried by one of the abuductors who was killed in clash with troops," de Wanna was quoted as saying. The 12 workers from forest concessionaire PT Kamundan Raya, a subsidiary of the privately-owned agribusiness Djajanti Group, were part of a larger group kidnapped on August 14. They were taken after a raid by a group of lightly armed Irianese on their base camp 60 km (35 miles) east of the mining town of Timika, 4,000 km (2,500 miles) east of Jakarta. While a number of hostages have escaped or been released, the report said the military had not yet managed to free any captives. De Wanna said the captured documents showed that the dead man, identified as Tius Orop Yane Magae Yogi, aged in his 30s, was the leader of a "security disturbing group" (GPK). The military in Irian Jaya uses the term GPK to describe the Free Papua Movement (OPM) whose lightly armed bands of rebels have roamed the countryside in their campaign against Indonesian rule in the former Dutch colony since 1963. The military had earlier played down the links between the hostage takers and any political movement. Earlier this year, the OPM held 11 people, including five Europeans, in captivity for more than four months in what it said was an act aimed at publicising its fight for a free Irian Jaya. In May, four British, two Dutch and three Indonesian hostages held by the OPM escaped after an army operation for their rescue was launched. Two Indonesian hostages were killed by their captors. 2931 !GCAT !GDEF !GDIP !GPOL The second "Battle of Okinawa" opens this week when Japan's Supreme Court decides if local authorities can deny land to U.S. military bases followed by an historic referendum on whether Okinawans want the bases. Parliamentarians and political commentators say the events over the next two weeks could split Prime Minister Ryutaro Hashimoto's coalition and even trigger general elections, The row over U.S. forces' concentration on Okinawa also has the potential to threaten U.S. security arrangements in Asia. The bitter year-long controversy, which comes to a head first on Wednesday with the court ruling and 10 days later with the referendum, was triggered by the rape of an Okinawan schoolgirl by three U.S. servicemen last September. The servicemen were convicted and sentenced to up to 10 years in jail. A local court is expected to rule on September 12 on their appeal. Public outcry over the rape set off the present chain reaction. The first skirmish takes place in Tokyo at the Supreme Court when the Grand Bench of 15 judges, headed by Chief Justice Toru Miyoshi, rules whether local authorities must appropriate land for U.S. bases on the orders of Tokyo. The next round is a September 8 Okinawa referendum on a non-binding resolution demanding the central government scale down, but not immediately close, U.S. bases on the island. In both cases, the issue is the lopsided U.S. presence on the island, about 1,000 miles (1,600 km) south of Tokyo. The island's 1.2 million people are host to a vast array of marine camps and air force bases that make up 75 percent of U.S. military facilities in Japan. About two-thirds of the 47,000 U.S. troops in Japan are also based on the sub-tropical island which is a popular holiday resort for Japanese. Many Okinawans argue that with only one per cent of Japan's land and one per cent of its population, they carry an unfair burden. Strategically located in easy range of China, Taiwan, and North Korea, about half of the 100,000 U.S. forces in Asia are based in Japan and a significant realignment or cutback in their presence would be a military planner's nightmare. The U.S. presence is a legacy of the last great battle of World War Two, the Battle of Okinawa. A third of the islanders, about 140,000 people, were killed in the battle, many forced to commit mass suicide by fanatical Japanese soldiers in the last days of the war. After its defeat, Japan ceded Okinawa to U.S. military rule which lasted until 1972. In those years, the Okinawa economy never caught up with the rest of Japan, and the prefecture is now the poorest in Japan, with a per capita income half that of Tokyo. Okinawa Governor Masahide Ota, who wants all U.S. forces out by 2015, has brought the matter to a head by refusing to sign orders needed to extend leases of private land for U.S. bases. Ota has said an April agreement worked out by Hashimoto and President Bill Clinton at a Tokyo summit to reduce the amount of land occupied by U.S. bases by one-fifth does not go far enough. On Wednesday, the Supreme Court is expected to uphold lower court rulings in favour of the central government, because accepted international law gives treaties, such as the U.S.-Japan Security Treaty which forms the basis of land appropriations, precedence over domestic laws. But while the Supreme Court ruling will pass judgment on the legality of Ota's actions, the referendum's results could easily offset the political effects of the court action. No one expects Okinawans to return a "no" vote. The key figures will be the size of the "yes" vote and voter turnout. If Ota defies a court ruling for land appropriations, Hashimoto's Liberal Democratic Party (LDP) has floated the idea of a parliamentary law allowing the central government to overule local governments on land use for military bases. But both the Social Democratic Party and Sakigake, the LDP's coalition partners, baulk at such action. Some senior members have threatened to walk out of the coalition -- a move which would force Hashimoto to call elections. The rest of Japan is doing nothing to help the central government and Okinawa get out of the impasse. Efforts to find alternative sites for some U.S. forces on mainland Japan have been roundly rejected so far by other local authorities. 2932 !GCAT !GDEF !GDIP Taiwan on Sunday dismissed China's stern objections to the sale of 1,299 U.S.-made Stinger missiles to the island, saying the deal should present no problems. "These (the Stingers) are ordinary defensive weapons...there should be no problem in the deal," a military spokesman quoted the island's Defence Minister, Chiang Chung-ling, as saying. Rejecting a demand by China, the U.S. Defence Department notified Congress on Friday of plans to sell Stinger missiles, launchers and other equipment to Taiwan. "The sale of this equipment will not affect the basic military balance in the region," the Pentagon told Congress. The Pentagon said Taiwan wanted to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stinger missiles, 96 Humvee vehicles and 500 rounds of .50 calibre ammunition for an estimated $420 million. Taiwan newspapers quoted Jason Hu, Taiwan's representative in the United States, as saying the sale was "within our expectation". China had demanded on August 15 that the sale be cancelled, saying the United States had made a "solemn commitment to China on the question of selling weapons to Taiwan". China, which has regarded Taiwan as a renegade province after a civil war split them in 1949, strongly objects to military links between Taiwan and foreign countries. China threatens to recover Taiwan by force if it declares independence. Taiwan says it wants reunification instead of independence, but only after China becomes democratic. Earlier this year, Beijing carried out a series of war games in waters off Taiwan intended to intimidate voters in the run-up to Taiwan's first-ever presidential election. 2933 !GCAT !GVIO Rebel heroes in the 1980s, South Korea's student leaders are now being rounded up as communist stooges of North Korea in a new Red scare. Their radical organisation is being swept off Seoul's Yonsei University along with a mountain of rubble, smashed desks and empty tear gas shells after pitched battles with riot police there last week. Other elite campuses, too, are cracking down on what President Kim Young-sam has branded guerrilla warfare and what state prosecutors have condemned as terrorism. Indulgent university authorities have tolerated leftist agitation for years. So why the sudden panic? Government officials say student goals have changed, that leftist firebrands who battled for democracy in the late 1980s are now trying to smash it down under cover of a campaign for unification of capitalist South and communist North. Violence at Yonsei began when police moved against a Pyongyang-inspired festival in support of a single Korea. The festival marked the 51st anniversary of the division of the Korean peninsula following World War Two. Rallies were also staged in North Korea to mark the date. While South Korean students have long flirted with Pyongyang's quirky brand of communism, a hardened core now appears to be growing better organised and armed. Its pro-Pyongyang activities are becoming more brazen: two South Korean students who slipped into North Korea went on hunger strike in protest against the Yonsei crackdown. North and South Korea have been technically at war since their 1950-53 conflict ended with a truce. Critics believe President Kim is playing a political game. Nearing his final year in office, they say Kim is pandering to a public scared of Pyongyang and its military might to boost his standing and avoid becoming a lame duck. Kim also needs rightwing support as he selects a candidate to replace him in presidential elections next year. The massive assault on Yonsei last Tuesday appeared designed to achieve more than just dislodge several thousand students from their classroom strongholds. The raid involving helicopters and black-hooded combat troops was given blanket coverage on television networks. Although the students were armed with rocks, steel pipes and molotov cocktails -- and fought savagely enough to fatally wound a young riot policeman -- they were also exhausted and running out of food after a long siege. Students were rounded up, roped together and clubbed. Some of the worst beatings were meted out to women. Opposition figures complained of excessive force. After all, they noted, the unification festival has been a fixture of Yonsei campus life for years. But student-bashing has played well with the public. The government has released opinion polls showing ordinary Koreans were solidly behind the crackdown. Among the public there was a sense of anger, and dismay, at the sight of fist-waving students chanting slogans and singing songs penned by North Korean propagandists. Some of South Korea's brightest young people unquestioningly accept North Korea's blueprint for unification that would leave the governments of North and South intact. So far, 369 students have been formally arrested and police have issued wanted notices for top leaders of the Korean Federation of University Student Councils. Many rank and file students insist they are not communists, just exercising their democratic right to express an opinion on reunification -- a goal espoused by Seoul as well as Pyongyang. They are also demanding the withdrawal of 37,000 U.S. troops based in South Korea to deter a Northern attack. President Kim has ordered university boards to stop coddling student leaders by, for instance, offering them passing grades even if they skip classes. Among other moves being considered: withdrawing the federation's money-spinning campus franchises on soft drink vending machines. Some analysts say Kim is polishing his anti-Communist credentials as protection. If Pyongyang accepts a proposal for peace talks put forward by Seoul and Washington, he could find himself in the politically uncomfortable position of making compromises with the enemy. 2934 !GCAT !GCRIM Twelve seamen are dead after an apparent mutiny in the South Pacific on a Honduran-registered fishing boat, Korean police said on Sunday. The boat was found by a Japanese maritime police vessel drifting without fuel early on Sunday. Ethnic Koreans from China apparently staged a shipboard uprising after complaints of hard work, the spokesman said by telephone from the port of Pusan. Among the dead are the South Korean captain, six other South Koreans, four Indonesians and one Chinese-Korean. All the bodies had been thrown overboard, the spokesman said. Thirteen crewmembers remained on the vessel, including six alleged mutineers who were all ethnic Korean Chinese and were now under the control of six Indonesians and a South Korean, the spokesman said. "This is an obvious mutiny by Koreans from China who felt unhappy with their working conditions," he said. It was not immediately clear when the mutiny took place, but all contact with the ship, the Peskamar 15, was lost on August 3 as it sailed towards the South Pacific island of Samoa. The boat is managed by a South Korean fishing company, Daehyun, and was fishing for tuna. The spokesman said a Japanese vessel on Saturday picked up a distress signal from the stricken boat. The maritime vessel reached the scene early Sunday morning. South Korea's Yonhap news agency said the fishing boat left Pusan on July 14. Korean employers around Asia have earned a reputation for tough, and at times brutal, management of their workers. 2935 !GCAT !GDEF !GDIS A U.S. fighter plane, carrying an Israeli airforce official, blew a tyre and caught fire while landing on Sunday at Israel's Ben Gurion airport, an Israel army spokeswoman said. The pilot and Israeli passenger were unharmed. "An Israeli airforce commander Major-General Eitan Ben Eliahu was invited today by the commander of the American airforce carrier Enterprise to conduct an official tour on the carrier and view various air exercises," she said. "After he viewed air exercises he was flown back to Ben Gurion airport in an F-14 carrier piloted by an American. While the plane was landing the back right wheel blew and exploded." 2936 !GCAT !GPOL Israeli Prime Minister Benjamin Netanyahu will meet Palestinian President Yasser Arafat within two weeks, Israel Television said on Sunday. "As of now, President (Ezer) Weizman, Prime Minister Netanyahu and Defence Minister Yitzhak Mordechai will meet within two weeks with Yasser Arafat," Israel's state-run television said. It said that Netanyahu would most likely meet Arafat before the Israeli prime minister travels to the United States on September 10. The television said Netanyahu's meeting with Arafat would indicate to the Americans his readiness to pursue peace with the Palestinians. It said the meetings had been agreed during talks between PLO official Abu Mazen and Netanyahu adviser Dore Gold. Since his May election Netanyahu has refused to meet Arafat, saying he would do so only when he deemed it necessary for Israel's security. The television said that Defence Minister Mordechai would meet Arafat to discuss security issues, including a redeployment of Israeli troops from the West Bank city of Hebron. Israel was due to redeploy in Hebron, the last major West Bank city still under Israeli control, in late March but delayed for security reasons. Some 400 Jews live among more than 100,000 Palestinians in Hebron. The Israeli president earlier in the day said he would invite the Palestinian leader to his home but set no date. Weizman said Arafat had sent him a letter "in which he spelled out his troubles and problems and said 'I hope we will meet soon'." Weizman made the announcement at a hurriedly called news conference with Netanyahu only hours after a newspaper said the outspoken president had threatened to meet Arafat over the right-wing leader's objections. "After an exchange of opinions, we agreed that the meeting would be held -- no date was set -- in my house, which is the most appropriate place," Weizman said after consulting Netanyahu at the president's Jerusalem office. Israel Television said the talks between Weizman and Arafat would take place in the central Israeli village of Caesarea after the Netanyahu-Arafat meeting. Weizman said he met Netanyahu last Tuesday and showed him Arafat's letter. 2937 !GCAT !GPOL !GVOTE North Lebanon voted on Sunday in the second round of Lebanon's parliamentary elections and observers reported a sharp drop in electoral abuses after charges of widespread vote-rigging in the first round. Troops patrolled this Sunni Moslem port city during the voting but only minor incidents of violence were reported. Fears of a repeat of abuses which marred the first round, when the pro-Syrian government rolled out a powerful electoral machine to crush a challenge by nationalist Christians, failed to materialise. Some 580,000 voters were eligible to elect 28 deputies to the 128-member parliament. Mount Lebanon, the Christian heartland, elected 35 deputies last Sunday and Beirut, south Lebanon and the Bekaa valley vote on the next three Sundays. As the polls closed, officials said about 50 percent of voters cast their ballots in Tripoli and other towns compared with 31 percent in north Lebanon in 1992 when most Christians and many Moslems boycotted the election. "There are some violations but in general it is much calmer than Mount Lebanon," Paul Salem, head of the Lebanese Association for the Democracy of Elections (LADE), said. "I don't believe the violations are directed against anyone in particular, because none of the lists of candidates forms a clear front for or against the government," Salem told Reuters. LADE said police were illegally in some election booths and authorities had given candidates voter lists at the last minute, some of them flawed. Mikhail Daher, a Maronite Christian candidate opposed to Prime Minister Rafik al-Hariri, said many people found their names were not on voting lists and officials had summoned voters to tell them who to vote for. Daher said he telephoned Hariri to protest at the "scandalous" the way the vote was being run. Last week losing opposition candidates demanded the resignation of President Elias Hrawi and Interior Minister Michel al-Murr, who is organising the polls, charging widespread abuses after government supporters won 32 of 35 seats in Mount Lebanon. Newspapers dubbed the vote in the north, where four government ministers and 26 parliamentary deputies were seeking election, the most confusing round of the five-stage election. The five rival tickets based on local alliances and personal rivalries offered no clear choice between the government and opposition. Almost all candidates were friends of Syria, whose 35,000 troops give it a powerful say in Lebanese affairs and a close interest in the vote. Supporters of Hariri, who is trying to build a national political base and is running in Beirut next week, ran on several tickets, sometimes beside his political enemies. The most prominent list headed by two foes of Hariri -- Omar Karami, a former prime minister and Sunni Moslem, and Suleiman Franjieh, a Maronite Christian and former minister -- included three Hariri supporters. The main rival list, headed by Karami's cousin Ahmed Karami, also included three Hariri supporters beside three of the Sunni Moslem fundamentalist group Gama'a Islamiyeh which opposes him. The Gama'a is allied with the pro-Iranian Shi'ite Moslem Hizbollah which Hariri has denounced as "extremist" and vowed to crush in the election. 2938 !GCAT !GPOL Israeli President Ezer Weizman, answering a "distress" call from Yasser Arafat, said on Sunday he would invite the Palestinian leader to his home but set no date. Weizman made the announcement at a hurriedly called news conference with Prime Minister Benjamin Netanyahu only hours after a newspaper said the outspoken president had threatened to meet Arafat over the right-wing leader's objections. "After an exchange of opinions, we agreed that the meeting would be held -- no date was set -- in my house, which is the most appropriate place," Weizman said after consulting with Netanyahu at the president's Jerusalem office. Israel Radio reported the talks in the central Israeli village of Caesarea would take place within two weeks. "I see it as an important meeting," said Nabil Shaath, Palestinian planning and international cooperation minister. Weizman said Arafat had sent him a letter "in which he spelled out his troubles and problems and said 'I hope we will meet soon'". Palestinian Local Government Minister Saeb Erekat said Arafat had also sent the message to U.S. President Bill Clinton and the European Union to underline the "grave" state of Israel-PLO peace efforts. "The peace process before the (May 29) Israeli elections was like the movement of a turtle and Mr Netanyahu came and turned this turtle on its back," Erekat told reporters in Gaza. Weizman said he met Netanyahu last Tuesday and showed him Arafat's letter. "He read it carefully. Afterwards I told him, 'Look, I want to agree to his request and meet him and I propose I do so in (my private residence) in Caesarea," Weizman said. The Yedioth Ahronoth daily said the president had given Netanyahu until Sunday morning to agree either to meet Arafat himself or give Weizman the green light to issue an invitation. Netanyahu, who opposes exchanging occupied land for peace -- the bedrock of the former Labour government's peace deals with the Palestinians -- has said he is in no hurry to see Arafat. But Weizman, again putting Netanyahu on the spot, said he believed the prime minister would eventually talk to Arafat. "I suppose that as times go by and things develop, the prime minister will meet him...at the appropriate date," said Weizman, who as defence minister in the late Menachem Begin's right-wing government helped forge peace with Egypt. On Thursday Netanyahu telephoned Egyptian President Hosni Mubarak to tell him that peace talks with the PLO last held before the Israeli poll would resume "in the very near future". Netanyahu was apparently shaken by Mubarak's suggestion he might cancel a Middle East economic summit in November over Israel's stalling peace moves. Palestinians are still waiting for Israel to announce a date for a long-delayed troop redeployment in the West Bank town of Hebron. The PLO regards the partial pullout as a test of Netanyahu's peace intentions. Asked why he had agreed to meet Arafat, Weizman said: "Firstly because of (his) distress. But that is not the main thing: Arafat, whether we want it or not, is the first Palestinian leader in 100 years of confrontation to have attained a great political achievement." Weizman has met Arafat once, at the 1994 inauguration of South African President Nelson Mandela. "Today he has control over more than two million Palestinians. When a leader like that, who is my neighbour...asks to see me, I think I have to agree," Weizman said. Only months ago, Weizman -- who has never let his ceremonial post stop him venting his opinions -- publicly demanded the former Labour government suspend peace efforts with Arafat following suicide bombings in Israel by Moslem militants. 2939 !GCAT !GPOL Israeli President Ezer Weizman, answering a "distress" call from Yasser Arafat, said on Sunday he would invite the Palestinian leader to his home but set no date. Weizman made the announcement at a hurriedly called news conference with Prime Minister Benjamin Netanyahu only hours after a newspaper said the outspoken president had threatened to meet Arafat over the right-wing leader's objections. "After an exchange of opinions, we agreed that the meeting would be held -- no date was set -- in my house, which is the most appropriate place," Weizman said after consulting with Netanyahu at the president's Jerusalem office. Israel Radio reported the meeting in the central Israeli village of Caesarea would take place within two weeks. Weizman said Arafat had sent him a letter "in which he spelled out his troubles and problems and said 'I hope we will meet soon'". "After the letter was translated to Hebrew, I invited the prime minister to see me last Tuesday. I showed him the letter. He read it carefully. Afterwards I told him, 'Look, I want to agree to his request and meet him and I propose I do so in (my private residence) in Caesarea," Weizman said. The Yedioth Ahronoth daily said the president had given Netanyahu until Sunday morning to agree either to meet Arafat himself or give Weizman the green light to issue an invitation. Netanyahu, who opposes the principle of exchanging occupied land for peace -- the bedrock of the former Labour government's peace deals with the Palestinians -- has said he has no desire to see Arafat. But Weizman, again putting Netanyahu on the spot, said he believed the prime minister would eventually talk to Arafat. "I suppose that as times go by and things develop, the prime minister will meet him...at the appropriate date," said Weizman, who as defence minister in the late Menachem Begin's right-wing government helped forge peace with Egypt. On Thursday Netanyahu, elected on May 29, telephoned Egyptian President Hosni Mubarak to tell him that peace talks with the PLO last held before the Israeli poll would resume "in the very near future". Netanyahu was apparently shaken by Mubarak's suggestion earlier on Thursday that he might cancel a Middle East economic summit in November over Israel's stalling peace moves. Palestinians are still awaiting an Israeli announcement of a date for a long-delayed troop redeployment in the West Bank town of Hebron. The PLO regards the redeployment, to which Israel's previous government committed itself in an accord signed with the PLO last September, as a test of Netanyahu's peace intentions. Asked why he had agreed to meet Arafat, Weizman said: "Firstly because of (his) distress. But that is not the main thing: Arafat, whether we want it or not, is the first Palestinian leader in 100 years of contfrontation to have attained a great political achievement." Weizman has met Arafat once, at the 1994 inauguration of South African President Nelson Mandela. "Today he has control over more than two million Palestinians. When a leader like that, who is my neighbour...asks to see me, I think I have to agree," Weizman said. There was no immediate reaction from Arafat to Weizman's comments. Only months ago, Weizman -- who has never let his ceremonial post stop him venting his opinions -- publicly demanded the former Labour government suspend peace efforts with Arafat following suicide bombings in Israel by Moslem militants. 2940 !GCAT !GPOL !GVOTE Voting began on Sunday in north Lebanon in the second round of parliamentary elections with 580,000 voters eligible to choose 28 members of the 128-member parliament. Troops in armoured vehicles patrolled the streets of this predominantly Sunni Moslem port city as polling stations opened at seven a.m. (0400 GMT) and voters began casting their ballots for five rival lists of candidates. Troops also patrolled the streets of smaller towns as the voting got under way. The election in north Lebanon, which includes Sunni, Alawite, Greek Orthodox and Maronite communities, follows a first round of voting on August 18 in which supporters of the pro-Syrian government won 32 of 35 seats in Mount Lebanon, the Christian heartland. Beirut, south Lebanon and the eastern Bekaa Valley will vote on the next three Sundays until September 15. The Mount Lebanon vote raised a storm of opposition protests against alleged vote-rigging in favour of government supporters. Several defeated opposition nationalist candidates are preparing appeals to the Constitutional Council to cancel the vote and call a new vote in their districts. However, there are widespread fears of more violations in north Lebanon. Newspapers have dubbed the north the most confusing round of the five-stage election. Lebanon has no true national political parties and the five lists of candidates have been formed on the basis of local alliances and personal rivalries without offering a clear choice between the government and the opposition. Supporters of Prime Minister Rafik al-Hariri, who runs in Beirut next week, are running on different tickets in the north as he seeks to build a national political base. Almost all candidates are friends of Syria, whose 35,000 troops give it a powerful say in Lebanese affairs and a close interest in the vote. They include four government ministers and 26 parliamentary deputies seeking re-election. Even candidates who oppose the government are not against its pro-Syrian stance, unlike in the first round in Mount Lebanon when the opposition vowed to stop what they said was the whittling away of national sovereignty. Former prime minister Omar Karami, a Sunni Moslem, and Suleiman Franjieh, a Maronite Christian and former minister, are the most prominent anti-government candidates. Both are harsh critics of Hariri and close friends of Syria. Their list won 25 of the 28 seats in the last elections in 1992, but it could lose seats this time to a rival ticket headed by Karami's cousin Ahmed Karami. Ahmed's list, like the Karami-Franjieh ticket, includes three Hariri supporters. It also has three candidates of the Sunni Moslem fundamentalist group Gama'a Islamiyeh (Moslem Group) which opposes Hariri. The Gama'a is allied in parliament with the pro-Iranian Shi'ite Moslem Hizbollah (Party of God) which Hariri denounces as "extremist". 2941 !GCAT !GPOL Israeli President Ezer Weizman is considering inviting Yasser Arafat to meet him after receiving a letter from the Palestinian leader on advancing the peace process, a spokesman said on Sunday. Aryeh Shumer, director of the president's office, denied a report in Israel's Yedioth Ahronoth newspaper that Weizman had already invited Arafat to his private residence this coming week over the objections of Prime Minister Benjamin Netanyahu. But Shumer told Army Radio: "When a letter arrives from the head of the Palestinian Authority to the president of the state of Israel expressing his hopes and wishes for peace, it is only right that he talks about this with the president." Shumer said Weizman would consult with Netanyahu. Israel Radio reported that Weizman and Netanyahu would meet later on Sunday. "The president has no intention to hold any meeting (with Arafat) without full coordination with the prime minister," he said. Netanyahu, who opposes the principle of exchanging occupied land for peace -- the bedrock of the former Labour government's peace deals with the Palestinians -- has said he has no desire to meet Arafat. But Netanyahu has pledged his right-wing government would renew peace talks with the PLO. The Palestinian minister who will lead a PLO negotiating team said on Saturday Israel had informed Arafat it wanted to begin the talks before September 2. On Thursday Netanyahu, elected on May 29, telephoned Egyptian President Hosni Mubarak to tell him that peace talks with the PLO last held before the Israeli poll would resume "in the very near future". Netanyahu was apparently shaken by Mubarak's suggestion earlier on Thursday that he might cancel a Middle East economic summit in November over Israel's stalling peace moves. Palestinians are still awaiting an Israeli announcement of a date for a long-delayed troop redeployment in the West Bank town of Hebron. The PLO regards the redeployment, to which Israel's previous government committed itself in an accord signed with the PLO last September, as a test of Netanyahu's peace intentions. Yedioth Ahronoth said Weizman scheduled a meeting with Arafat at his private resident in the central Israeli village of Caesarea after the Palestinian leader sent him an emotional appeal "to save the peace process". A PLO official told Reuters that Arafat had yet to receive a response from Weizman. "Yasser Arafat wrote a letter to (U.S. President Bill) Clinton and also wrote one to the president of Israel...The president reported immediately to the prime minister and they decided to meet and decide," Shumer told Israel Radio. Shumer denied Yedioth Ahronoth's report that Weizman had issued an ultimatum to Netanyahu to meet Arafat himself within 10 days. "He (Weizman) did not say 'If you don't meet him, I will'," Shumer said. The office of Israeli president is largely ceremonial. But Weizman, a former defence minister and an architect of Israel's peace treaty with Egypt, has spoken out frequently on the peace process with the Palestinians -- at times urging the former Labour government to slow it down. Asked about Weizman's current position, Shumer said: "The president wants the peace process to continue." 2942 !GCAT !GPOL Israeli Prime Minister Benjamin Netanyahu said the peace process with the Palestinians was moving forward and Israeli television reported that he would meet Palestinian President Yasser Arafat soon. Israeli President Ezer Weizman, answering a "distress" call sent in the form of a letter from Arafat, said he would invite the Palestinian leader to his home but set no date. "As of now, President Weizman, Prime Minister Netanyahu and Defence Minister Yitzhak Mordechai will meet within two weeks with Yasser Arafat," Israel's state-run Channel One television reported on Sunday. Netanyahu has said he will hold talks with Arafat only when he deems it necessary for Israel's security, but the television report said a meeting would be held prior to his visit to the United States scheduled for September 10. Asked about the peace process with the Palestinians, Netanyahu told Israel television: "It is starting to move, it is simply moving differently. Not only are we giving, they are also giving. That is the way negotiations should be conducted." Netanyahu's senior political adviser Dore Gold told Reuters: "I think we are in the process of coming to a series of understandings between Israel and the Palestinian Authority. "I think we can be optimistic that both sides will be in the not to distant future fulfilling their obligations to the agreements they signed in a manner that is mutually satisfactory." Gold will meet his Egyptian counterpart, Osama el-Baz, and U.S. Middle East coordinator Dennis Ross in Paris on Monday to discuss a Middle East economic summit due to be held in Egypt in November, Israel radio said. Netanyahu, apparently shaken by Egyptian President Hosni Mubarak's suggestion that he might cancel the summit, phoned Mubark last week to tell him that peace talks with the Palestine Liberation Organisation would resume soon. Netanyahu, elected in May, is opposed to exchanging occupied Arab land for peace, the bedrock of the peace policy of the Labour government he replaced. Palestinians are still waiting for Israel to announce a date for a long-delayed troop redeployment in the West Bank town of Hebron. The PLO regards the partial pullout as a test of Netanyahu's peace intentions. Weizman, asked why he had agreed to meet Arafat, said: "Firstly because of (his) distress. But that is not the main thing. Arafat, whether we want it or not, is the first Palestinian leader in 100 years of confrontation to have attained a great political achievement. "He has control over more than two million Palestinians. When a leader like that, who is my neighbour...asks to see me, I think I have to agree." 2943 !GCAT !GVIO Suspected Moslem militants shot dead four people on Sunday when they stormed into the house of a community leader in southern Egypt, security sources said. They said gunmen burst into the house of the chief of a village in Mallawi town, about 260 km (160 miles) south of Cairo, and opened fire. The community leader was not in the house at the time. Police in Mallawi believe the gunmen belonged to the militant al-Gama'a al-Islamiya (Islamic Group), which has been fighting to overthrow the government and set up a strict Islamic state since 1992. Mallawi is in Minya province, which has been the centre of much militant violence over the past couple of years. About 1,000 people, mainly militants and policemen, have been killed in political violence in Egypt over the last four year. 2944 !GCAT !GDIP Japanese Foreign Minister Yukihiko Ikeda during a visit to Gaza on Sunday invited Palestinian President Yasser Arafat to travel to Japan. "I invited President Arafat to visit Japan on September 10 to September 13. It will be a good opportunity for him to meet Japanese leadership," Ikeda said after the meeting. Ikeda arrived in Gaza on Sunday on the fifth leg of a regional tour after Israel, Amman, Egypt and Syria to boost bilateral ties and discuss the stalled Middle East peace talks. Arafat said the two "discussed in detail the ways to push the peace process forward." Earlier on Sunday Ikeda met in Jerusalem with Israeli President Ezer Weizman. Ikeda is scheduled to meet with other Israeli officials on Monday before travelling to Saudi Arabia. Arabs have condemned Israeli Prime Minister Benjamin Netanyahu for refusing to exchange occupied Arab lands for peace, a principle endorsed by his predecessor Shimon Peres and the basis of the peace talks since 1991. While in Amman, a Japanese spokesman quoted Ikeda as saying Japan was committed to advancing Palestinian-Israeli talks. 2945 !GCAT !GCRIM An Israeli military court on Sunday sentenced a Palestinian to life in prison plus 20 years for his part in a 1994 attack in Jerusalem in which two people were killed. The court in the central Israeli town of Lod convicted Iman Sider, 30, on eight counts, including belonging to the Islamic militant group which carried out the shooting, an army ststement said. Hamas, an opponent of the Israel-PLO peace accords, claimed responsibility for the attack. "The Lod military court sentences Iman Sider to life plus 20 years," an Israel army statement said. In the October 1994 attack, two Hamas gunmen opened fire at midnight at a crowded Jerusalem pedestrian mall killing two people. The guerrillas were shot dead during the attack. The statement said Sider was involved "in the transer of the weapon and the transport of the terrorists". 2946 !GCAT !GPOL Israeli Prime Minister Benjamin Netanyahu will meet Palestinian President Yasser Arafat within two weeks, Israel radio said on Sunday. "As of now, President (Ezer) Weizman, Prime Minister Netanyahu and Defence Minister Yitzhak Mordechai will meet within two weeks with Yasser Arafat," Israel radio said. Israel's state-run television said that Netanyahu would most likely meet Arafat before travelling to the United States on September 10. It said the meeting had been agreed upon during talks between PLO official Abu Mazen and Netanyahu adviser Dore Gold. Since his May election Netanyahu has refused to meet Arafat, saying he will do so only when he deems it necessary for Israel's security. Weizman said earlier on Sunday that he would invite Arafat to his home but set no date. The Israeli president said Arafat had sent him a letter "in which he spelled out his troubles and problems and said 'I hope we will meet soon'". 2947 !GCAT !GDEF !GDIS A U.S. fighter plane blew a tyre and caught fire while landing on Sunday at Israel's Ben Gurion airport, an airport spokesman said. "A U.S. F-14 military plane while landing at Ben Gurion airport blew a wheel and a fire broke out," said spokesman Yehiel Amitai, adding that the two pilots on board were not injured. "Airport officials declared an emergency situation at the highest level and the fire brigade put out the flames while the plane was landing," he said. 2948 !GCAT !GENT !GSCI Archaeologists in Egypt have found pots used by ancient Egyptians in burial rites that they say may reveal the secrets of mummification. Mohammed Saleh, director of the Egyptian Museum, told Reuters television a U.S. team found the pots, some of which contain human intestines, in a tomb built into the rocks while digging in Dahshour, a village 40 km (25 miles) south of Cairo. Dahshour is the site of Egypt's second largest pyramid, built for the pharaoh Seneferu more than 4,500 years ago. Saleh said the team -- from New York's Metropolitan Museum -- found four Canopic jars and two unguent jars in the tomb, which belongs to an unidentifed person who lived during the 12th Dynasty (1991-1786 BC) in the Middle Kingdom. "This finding is important because one of the jars still contains substances and materials used in the conservation of mummies and the conservation of the intestines and all the things which were in the cavity of a person we have not identified yet," Saleh said. "We hope that the analysis of such substances and liquids will reveal some secrets of the mummification process and materials used in this process," he added. 2949 !GCAT !GDIP Jordan, which has blamed Iraq for domestic bread riots, will not let Jordanians study in Baghdad this year under an Iraqi university scholarship programme, officials said on Sunday. "We will not send any students on the Iraqi scholarship programme to study in Iraq this academic year," a senior official, who requested anonymity, told Reuters. "But those who want to go and study on their own means can do so," he added. The scholarships, part of decades-old bilateral cooperation, allowed between 300 and 400 Jordanian students a year to study at Iraqi universities. More than 4,000 Jordanians are currently studying in Iraq. King Hussein has said Jordanians who studied in Iraq or where sympathetic to Iraqi President Saddam Hussein were involved in this month's riots following a doubling of bread prices. However, government attempts to blame the riots on Iraq have been treated with scepticism by many politicians and ordinary people who say the protests were sparked by rising poverty and umeployment. The riots shook the southern town of Karak, once a bastion of pro-Iraqi ideology, on August 16 and spread to nearby towns before reaching a poor district of Amman. They were the most serious civil disturbances since 1989 riots that also followed price rises. Jordanian officials have accused Saddam's Baath Party of cultivating Jordanian and other Arab students over the years through scholarships. Information Minister Marwan Muasher said on Saturday Jordan had undisclosed proof of official Iraqi involvement in the riots and would put pro-Iraqi activists on trial soon. Amman also told three Iraqi embassy employees to leave. Iraqi state radio last week denied any role by Baghdad in the unrest. The Jordanian Arab Socialist Baath Party, a pro-Iraqi organisation with one deputy in the 80-seat lower house of parliament, also denied it was involved. 2950 !GCAT !GPOL Israel began moving caravans into the West Bank on Sunday in the first expansion of Jewish settlements under Prime Minister Benjamin Netanyahu. Israel radio said the caravans would be used as classrooms and not as living quarters. Palestinian Minister of Higher Education Hanan Ashrawi condemned the move as a "direct affront on the peace process". "These mobile units are not just temporary structures, they are preparation for further expansion for further settlement activities and as such they violate any possibility of a genuine peace in the future," Ashrawi told reporters in self-ruled Gaza. The first 11 of nearly 300 caravans were rolled into place in two West Bank settlements in accordance with Defence Minister Yitzhak Mordechai's decision earlier this month to approve their placement, Israel radio said. "The government took a decision and it will carry it out," Shlomo Dror, spokesman for Israel's coordinator of activities in the West Bank and Gaza, told Reuters. The move was the government's first action on settlements since Netanyahu in August lifted a freeze on settlement building in occupied lands imposed by the previous government which made peace deals with the Palestine Liberation Organisation (PLO). Peace Now, Israel's leading peace movement, said settlement expansion would only deepen a crisis with the Palestinians. "Moving mobile homes in the territories is incompatible with the peace process," it said in a statement. Palestinians say Netanyahu's expansion of settlements while stalling on peace moves raises doubts about the future of PLO-Israel peace accords. Palestinians, who hope to eventually establish an independent state in the West Bank and Gaza Strip, regard the 130,000 Jews living amidst nearly two million Palestinians in the West Bank and Gaza as an obstacle to peace. 2951 !GCAT !GDIP Palestinian leader Faisal al-Husseini will arrive Damascus on Sunday to discuss with Syrian and Palestinian officials recent developments in the Middle East peace process. A Palestinian official said Husseini, a PLO excutive committee member and responsible for Jerusalem affairs, would discuss with Syrian Foreign Minister Farouq al-Shara what the official termed Israel's "destruction and Judaisation measures of Jerusalem as a severe blow to the peace process." Anwar Abdul-Hadi, information consultant for PLO foreign affairs chief Farouk Kaddoumi, accused Israel of putting obstacles before the peace, saying that could destroy the whole process. He said Husseini's talks would cover the policy of Israel's ruling Likud party which he warned would lead to the "collapse of the whole peace process if (Israeli Prime Minister Benjamin) Netanyahu does not adhere to the land-for-peace principle, especially on the Syrian, Lebanese and Palestinian tracks." After winning elections in May, the Likud leader voiced opposition to handing back land seized from the Arabs in 1967, including Jerusalem, and vowed the city would be Israel's eternal capital. Palestinians want East Jerusalem as the capital of their future state. Israel earlier this month lifted a ban, imposed by the previous Labour government, on building settlements in the West Bank. The housing ministry later announced a plan to build 5,000 houses there. "Husseini will also exchange views with Khaled al-Fahoum, head of the Palestinian National Salvation Front, over the Palestinian situation following the election of Netanyahu's government which opposes the minimum conditions for peace," Abdul-Hadi said. Husseini would also discuss with Shara how to coordinate positions in preparation for the Jerusalem Committee meeting to be held in Morocco next month. 2952 !GCAT !GCRIM Saudi Arabia executed on Sunday a Pakistani man accused of belonging to an armed gang of robbers, Saudi television reported. It quoted an Interior Ministry statement as saying Shabir Ahmad Muhammad Jalil was executed in Mecca. He was the 26th person executed this year in the kingdom. Saudi Arabia beheads convicted drug smugglers, rapists, murderers and other criminals. 2953 !GCAT !GCRIM !GPOL !GVOTE North Lebanon voted on Sunday in the second round of Lebanon's parliamentary elections and observers reported a sharp drop in electoral abuses after charges of widespread vote-rigging in the first round. Troops in armoured vehicles patrolled this predominantly Sunni Moslem port city as voting began. Officials said rival campaign workers scuffled outside a polling station and a man was badly hurt in a fight in the far north region of Akkar, but there were no other reports of violence. Some 580,000 voters were eligible to elect 28 deputies to the 128-member parliament. Mount Lebanon, the Christian heartland, elected 35 deputies last Sunday and Beirut, south Lebanon and the Bekaa valley vote on the next four Sundays. Last week losing Christian opposition candidates demanded the resignation of President Elias Hrawi and Interior Minister Michel al-Murr, charging widespread abuses after supporters of the pro-Syrian government won 32 of 35 seats in Mount Lebanon. Officials said 20 percent of votes in North Lebanon were cast by 2 p.m. (1100 GMT) compared with a total 31 percent vote there in 1992 when most Christians and many Moslems boycotted the poll. Fears of a repeat of last week's electoral abuses failed to materialise. "There are some breaches but in general it is much calmer than Mount Lebanon," Paul Salem, secretary-general of the Lebanese Association for the Democracy of Elections (LADE), told Reuters in Tripoli. LADE said police were positioned illegally inside some election booths and authorities gave candidates voter lists at the last minute. Maronite Christian candidate Mikhail Daher said many people found their names were not on voting lists and officials were summoning voters and telling them who to vote for. Daher said he telephoned Prime Minister Rafik al-Hariri to protest at the "scandalous" the way the vote was being run. Newspapers have dubbed the vote in the north, where four government ministers and 26 parliamentary deputies are seeking election, the most confusing round of the five-stage election. Five rival tickets are based on local alliances and personal rivalries and offer no clear choice between the government and opposition. Almost all candidates are friends of Syria, whose 35,000 troops give it a powerful say in Lebanese affairs and a close interest in the vote. Supporters of Hariri, who is trying to build a national political base and is running in Beirut, were running on different tickets, sometimes side-by-side with his enemies. The most prominent list was headed by two foes of Hariri: Omar Karami, a former prime minister and Sunni Moslem, and Suleiman Franjieh, a Maronite Christian and former minister. But their list included three Hariri supporters. The main rival list of Karami's cousin Ahmed Karami also included three Hariri supporters beside three of the Sunni Moslem fundamentalist group Gama'a Islamiyeh which opposes him. The Gama'a is allied with the pro-Iranian Shi'ite Moslem Hizbollah which Hariri has denounced as "extremist" and vowed to crush in the election. 2954 !GCAT !GCRIM Some 600 inmates at Kuwait's central prison have begun a hunger strike to press for better living conditions and fewer restrictions at its visiting area, a deputy said on Sunday. "The strike started yesterday (Saturday) and is still going on. About 600 inmates are on strike," said Ali al-Baghli, spokesman for parliament's human rights committee. Baghli was commenting on remarks by an inmate who called anonymously to an international news organisation claiming that all 1,487 inmates at Kuwait's main prison were on hunger strike. All kinds of prisoners were involved, he said. Interior ministry officials declined comment. "They are demanding better living conditions and they want to be allowed to receive visitors without a barrier (grill)," said Baghli. "The barrier in the visiting area was installed after a Pakistani prisoner escaped from the visiting area." "Officials are trying to meet the strikers' demands," said Baghli, noting that prison officials were preparing enhanced monitoring measures that would allow for the removal of the metal grill within a month. In January jail inmates burned down a prison hospital in a pre-dawn riot before security forces quelled the disturbances. The riot was caused by anger among drug addicts in the prison over a narcotics crackdown. Baghli said the grill was installed to prevent drug smuggling to inmates by visitors. "The January events will be repeated if the authorities do not meet our demands. Our strike is peaceful so far," said the inmate, who said he represented fellow prisoners. The caller said they wanted better sanitary facilities, workshops, food and better treatment by prison staff. 2955 !GCAT !GDIP Japanese Foreign Minister Yukihiko Ikeda wants Israel's Likud government to adhere to the land-for-peace formula to advance Middle East peace talks, officials said on Sunday. "In Israel we will be underscoring what we have been saying about the need for further progress on implementing agreements reached so far on the principle of land-for-peace and relevant U.N. resolutions," a Japanese spokesman told reporters after talks between Ikeda and Prime Minister Abdul-Karim al-Kabariti. Arabs have condemned Israeli Prime Minister Benjamin Netanyahu for refusing to exchange occupied Arab lands for peace, a principle endorsed by his predecessor Shimon Peres and the basis of the peace talks since 1991. Ikeda arrived in Amman on Saturday on the third leg of a regional tour after Egypt and Syria to boost bilateral ties and discuss the stalled Middle East peace talks. He is due to visit Palestinian self-ruled areas and Israel to meet Palestinian President Yasser Arafat and Israeli officials before heading to Saudi Arabia. Japan was committed to advancing Palestinian-Israeli talks, suspended since the victory in May elections of the hardline Netanyahu, the Japanese spokesman quoted Ikeda as saying. Israel has given no date for a long-delayed troop redeployment in the West Bank city of Hebron. Palestinians see the move, agreed by Israel's previous government last September, as a test of Netanyahu's intentions. Netayahu has also lifted restrictions on more Jewish settlement of occupied land and has done little to ease a ban on Palestinians working in Israel. "We urge the Palestinian-Israeli track should be advanced and the redeployment of Israeli troops from Hebron and the resumption of final status talks as soon as possible and an immediate lifting of the closure and urge restraint by the Israelis on the issue of settlements," the spokesman said. Ikeda and Kabariti signed an accord for a $7 million grant for Jordan to modernise the northern border crossing with Israel to help trade. The Japanese spokesman said Ikeda told Kabariti that Jordan's request for extra balance of payments support could only be considered within the context of multilateral agreements with other donors. Japan's soft loans and grants to Jordan in the last year have totalled $340 million, including $215 million in balance of payment support and a $100 million loan to expand Jordan's largest power plant in Aqaba. 2956 !GCAT !GHEA !GREL An Egyptian human rights group on Sunday mourned the death of a 14-year-old girl after a circumcision operation and urged the government to ban the ancient but dangerous procedure. Amina Abdelhamid Mohammed died in a private hospital on Saturday after a doctor performed the operation, which involves the removal of some or all of the external genitalia. The government daily newspaper al-Ahram said she died from haemorrhage and that the surgeon had disappeared. According to research in 1995 by a national task force made up of women and human rights activists, doctors and religious scholars, 80 percent of Egyptian girls are subjected to the procedure every year. Some activists prefer to call the practice female genital mutilation (FGM) for the severe form it often takes. Side effects include haemorrhage, shock and sexual dysfunction. "We will hold a day of remembrance every year for girls who have died from genital mutilation to remind people that enough is enough," Maha Attiya Eweiss of the Egyptian Human Rights Organisation (EOHR) told Reuters. "One of our goals is to have the government pass a law banning and criminalising genital mutilation and punishing anyone who carries out the procedure, be it a doctor, nurse, barber or traditional midwife," she said. Eweiss is coordinator of the group's Campaign Against Female Genital Mutilation, launched in 1995 to educate the public about the dangers of female circumcision and eradicate the procedure. Amina's death was particularly shocking because it dispelled the notion that it is safer for parents to take their daughters to doctors for circumcision. In Egypt, a traditional midwife or barber usually performs the procedure using unsterilised equipment. Health Minister Ismail Sallam last month banned female circumcision operations at public hospitals. Eweiss said his ban also prohibits all doctors from carrying out the procedure. Eweiss said mothers she had interviewed during research told her they circumcised their daughters to ensure their chastity before marriage and for cleaniless. She said a group of doctors from southern Egypt wanted to challenge the minister's decree in court on the grounds that it was less dangerous for doctors to carry out the procedure. "A doctor killed Amina yesterday. It is horrible. He is supposed to be responsible and he acted with carelessness," Eweiss said. "There is a black market in genital mutilation now. People use back doors. Some doctors use it to make money and do what they want without respect to the medical oath," she added. Female circumcision is practised in many Middle Eastern and African countries. Some Egyptians say the procedure is based on Islamic teaching, but others say it has more traditional roots because Moslem and Christian girls are circumcised. Sheikh Mohammed Sayyed Tantawi, the head of the eminent Islamic institute al-Azhar, has said the practice is un-Islamic and has supported Sallam's decision. EOHR tried to sue his predecessor for advocating the practice but he died before the end of the case. 2957 !GCAT !GPOL The Palestinian Authority has closed two offices in Arab East Jerusalem whose activities Israel charged were in violation of its peace deals with the PLO, Israel Radio said on Sunday. The radio said the self-rule administration, which has no official role in the holy city, shut down the Geographic and Measurements Office and the Sports and Youth Office. A spokesman for Israeli Prime Minister Benjamin Netanyahu said his office had received information on the closures and was watching the issue but declined further comment. Senior Palestine Liberation Organisation official Mahmoud Abbas declined to confirm or deny the report. Netanyahu has said Palestinian Authority operations in Jerusalem violate interim peace deals restricting such activities to self-rule areas in the West Bank and Gaza. He has linked closure of the Jerusalem offices to implementation of an agreement signed by the previous government to redeploy Israeli troops in the West Bank town of Hebron. Palestinians view the Hebron withdrawal as a litmus test of Netanyahu's intentions on Middle East peace moves and reject renogatiation of the deal. Israel delayed its redeployment from Hebron, originally scheduled for March, after a spate of Moslem suicide bombings killed 59 people in Israel in February and March. Palestinians have argued that their institutions in Jerusalem are PLO offices predating the peace deals which created the Palestinian self-rule Authority (PA) and are unconnected to self-rule governmental activities. "The offices in Jerusalem that are operational are not PA offices. All offices that were functioning before 1993 will continue operating and the PA has no offices in East Jerusalem," said Saeb Erekat, Palestinian local government minister. The dovish Labour party government Netanyahu ousted in May elections also said PLO offices in Jerusalem violated peace deals but in effect turned a blind eye to their activities. Israel captured Arab East Jerusalem in the 1967 Middle East war and later annexed it in a move unrecognized by the international community. It has declared both halves of the city its eternal capital. Palestinians view East Jerusalem as the capital of a future state. The city's fate is up for negotiation at final peace talks which have yet to resume under Netanyahu. 2958 !C31 !C312 !CCAT !E51 !E512 !ECAT !GCAT !GDIP Turkish pharmaceutical firms displayed their products in Baghdad on Sunday in their first such exhibition since sanctions were clamped on Iraq in 1990. The fair is the latest bid by Turkey to win the largest portion of funds that will emanate from Iraq's partial oil sales deal with the U.N., expected to go into effect in September. "About 26 companies are taking part. All ready to strike deals to supply Iraq with medicines and medical supplies," said Sameh Hamdan, a Jordanian middleman supplying both Iraq and Jordan with Turkish drugs. Of the $2 billion worth of oil Iraq will be allowed to export in six months, $210 million will be earmarked for medicines and medical supplies. Since Iraq signed the oil deal with U.N. in June, Turkish officials and businessmen have been flocking to Baghdad in the hope of getting the lion's share of the $1.3 billion that will be available to Iraq after deducting 1991 Gulf War reparations and other U.N. costs. The official press reported that representatives of Canadian and Greek companies were also in Baghdad seeking deals. Latif Oguz Kester of Fako, a Turkish medicines manufacturer, said he used to export $30 million worth of drugs and medical supplies to Iraq before U.N. trade sanctions were imposed on Iraq for invading Kuwait in 1990. "We sacked 250 workers after sanctions. We are here to bring them back and even hire more," Kester said. Ismail Oncel of Bioforma said Iraq's health needs were enormous and his company joined the exhibition as part of an "Iraq trade rush" hitting Turkey . Soon after Iraq's June oil deal a Turkish trade delegation under Foreign Trade Undersecretary Nejat Eren visited Baghdad and signed protocols for the export of food supplies to Iraq. Turkey's Justice Minister Sevket Kazan and Education Minister Mehmet Saglam visited Iraq this month and agreed with Iraq officials to set up a gas pipeline and boost trade. Iraqi leader Saddam Hussein received the two Turkish ministers. A delegation of 27 more Turkish businessmen came to Iraq in mid-August, seeking food contracts for the $870 million Iraq has allocated for the purchase of foodstuffs under the oil deal. Iraq's Health Minister Umeed Madhat Mubarak opened the Turkish pharmaceutical exhibition in Baghdad. 2959 !GCAT !GDIP Iraq tried to establish contact with Israel two years ago but then-prime minister Yitzhak Rabin vetoed any relations with Baghdad, a former Israeli cabinet minister said on Sunday. "Two years ago, a European oil man came to Israel...and told me the Iraqi ambassador in Geneva, (Iraqi President) Saddam Hussein's brother, was interested in meeting me to discuss Israeli-Iraqi relations," former energy minister Moshe Shahal said. Shahal, who was born in Iraq, told Israel Radio: "This, of course, was a matter for the prime minister. I spoke to Yitzhak Rabin at the time and two days later we agreed to reject the offer. "The refusal stemmed from a very simple reason -- to avoid any damage to our relations with the United States, which would not have viewed this meeting favourably," he said. In August 1994, Rabin denied reports that Saddam had made peace overtures to him. "No message has reached me from Saddam Hussein. I didn't ask for mediation with him, and I'm not interested in it," Rabin said at the time, reacting to an Israel Television report that Iraq had expressed readiness to discuss peace. Iraq, which fired dozens of Scud missiles at Israel during the 1991 Gulf War, had called the television report unfounded. Shahal said two years ago that the government should explore the possibility of making peace with Baghdad as a counter-move against a future nuclear threat from Iran. On Sunday, he said: "I think the prime minister made the right decision in this matter." Rabin was assassinated last November by a religious Jew opposed to his peace moves with the Arabs. 2960 !GCAT These are some of the leading stories in the Jordanian press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. JORDAN TIMES - King: Jordan is entering a new era. No going back on democracy; attempts to tamper with security and stability will not be tolerated. Information Minister Marwan Muasher says there is evidence that "some official parties in Iraq" were behind the disturbances in the south. - King to visit Bahrain soon. - Government asks senior Iraqi "diplomat" to leave, reviews status of others. - Japanese foreign minister arrives for talks on peace process, bilateral ties. AL RAI - Prime Minister Abdul-Karim al-Kabariti says government commited to lifting ceiling of democracy. - Saudi Prince Sultan telephones prime minister. - Jordan releases 32 from southern town of Karak. - Jordan expresses anger at conduct of some Iraqi diplomats in Amman which are incompatible with diplomatic traditions. AD DUSTOUR - Kabariti and parliament speaker meet to discuss ways to reactivate parliament's legislative role. AL ASWAQ - State security court starts investigating suspects in unrest. 2961 !GCAT These are the leading stories in the Moroccan press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. LE MATIN DU SAHARA - U.N. Secretary-General Boutros-Ghali says in report that Polisario Front hampers peace process in Western Sahara. - King Hassan meets Burkina Faso President Compaore who is on private visit. L'OPINION - Fish stocks in alarming decline in southern coastal city of Agadir owing to over-exploitation. AL-MAGHRIB - Constitutional reform will consolidate devolution and democracy. AL-BAYANE - King Hassan to confer with political parties over law splitting parliament into two chambers. AL-ALAM - Boutros-Ghali says resumption of proceedings for referendum in Western Sahara unlikely. 2962 !GCAT !GDIP Washington's new ambassador to Saudi Arabia is due in Riyadh shortly to fill a vacuum in what has become one of the most sensitive U.S. diplomatic posts. There has been no U.S. ambassador in the kingdom since April when Raymond Mabus returned home. Before the arrival of Mabus, who was close to President Bill Clinton but lacked foreign policy experience, the Riyadh post had been empty between August 1992 and July 1994. His successor is another political appointee -- Wyche Fowler, formerly a Georgia Democrat in the Senate, who was appointed two weeks ago when Clinton invoked special powers because the Senate dallied in confirming his nomination. "He's due in the next few days," a U.S. embassy spokesman said by telephone from the Saudi capital. Saudi Arabia places much emphasis in its dealings with its main ally on close personal contact, especially the relationship between the representative in Riyadh and the White House. Time was when a posting to the world's richest oil power meant little more hardship than living in splendid isolation in a closed compound in the capital's Safarat diplomatic quarter. Now the American embassy and 5,000 U.S. armed forces personnel are potential targets of what the White House calls an international terrorist campaign against the United States. Two bomb attacks have killed 24 Americans and two Indians and wounded nearly 500 in Saudi Arabia since last November. More Americans have been killed in Saudi Arabia during the past year than in Bosnia, where U.S. troops were placed in a combat situation, noted Claiborne Pell, ranking Democrat on the Senate Foreign Relations Committee. The United States must be prepared for more and bigger attacks in the Gulf, Defence Secretary William Perry said after a recent visit to the region. "Future attacks could be with more powerful bombs, or standoff weapons, or even chemical weapons," he told the American Bar Association. Four Saudis opposed to the U.S. presence were beheaded after confessing on television to the first attack last November. But two months after a fuel truck bomb at a Saudi apartment block killed 19 U.S. airmen on June 25, no arrests have been announced despite the lure of $5 million in rewards. Poor intelligence and high personnel turnover -- American security staff in the kingdom were rotated every 90 days -- contributed to unpreparedness for the second bomb, according to a U.S. congressional report. It said much of the U.S. intelligence on Saudi Arabia came from Saudis who may not have passed on full information on the Saudi dissident threat. Federal Bureau of Investigation agents sent to Saudi Arabia were denied an opportunity to interrogate the four confessed bombers. FBI Director Louis Freeh twice visited the kingdom after the second attack to seek more cooperation. About 800 members of U.S. government employees' families in Saudi Arabia are being repatriated as a precaution and military personnel are on maximum threat alert. 2963 !GCAT !GPOL Palestinian officials say Israeli Prime Minister Benjamin Netanyahu's stalling on PLO-Israel peace deals is killing the accords and doubt a new round of negotiations would bear fruit. "The Oslo (peace) agreement is decaying. Even backers of the accord are grumbling and frustrated and soon it will be buried," a senior aide to Palestinian President Yasser Arafat said. Palestinians are worried that what they won from the previous Israeli government -- limited self-rule in parts of the West Bank and Gaza Strip -- will be all they will get. Netanyahu's delay in redeploying Israeli troops in the West Bank town of Hebron is only the tip of the iceberg, they say. According to agreements signed with the government Netanyahu ousted in May elections, further redeployments from the rest of the West Bank must begin on September 7 and end mid-July 1997. "Hebron is already negotiated and agreed. Israel has only to implement the accord," chief PLO peace negotiator Saeb Erekat said. "Staged further redeployments from the West Bank are more important." Netanyahu, apparently shaken by Egyptian President Hosni Mubarak's hint last week he might cancel a Middle East economic summit in November, promised on Thursday that peace talks with the PLO would start "in the very near future". The prime minister also gave the green light on Sunday to Israeli President Ezer Weizman to meet Arafat. Weizman will host Arafat at his private home in central Israel within two weeks, Israel Radio said. PLO officials on Saturday said Israel told them talks, which have been suspended since before Netanyahu's May election, would resume before September 2. But the officials were sceptical the talks would advance the process. They believed that Netanyahu was anxious for window dressing to shield his unravelling of accords on the ground. "One is wondering if this government has a plan to say good bye to peace. Its policy of expanding settlements and changing the nature of Jerusalem is planting bombs with each step," Erekat told Reuters. Final peace talks are to deal with Jerusalem, refugees, Jewish settlements on occupied Arab land, and borders. Netanyahu has said until interim issues like Hebron are cleared up he does not want to move to final status issues. Palestinians said Netanyahu's election removed the fig leaf concealing weakenesses in the 1993 PLO-Israel framework peace deal negotiated at talks in Oslo and signed in Washington. Some officials say they still are not sure if Netanyahu's stalling is because he is a pragmatist who is running into far-right opposition in his government or if it is a ploy by a right-wing idealogue bent on tearing apart the peace deals. Arafat aide Tayeb Abdul-Rahim said whether it was a tactic or not: "Netanyahu's inability to take decisions is a policy of a weak man, not a statesman." Another senior PLO official said: "Netanyahu clearly lacks leadership. He acts and gives us verbal promises only when he comes under Arab and international pressure, but nothing is implemented on the ground." 2964 !GCAT These are some of the leading stories in the Saudi Arabian press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. AL-RIYADH - Yemeni president says two security agreements signed with Saudi Arabia aim at maintaining stability in the two countries. - Saudi Industrial Development Fund extended 2.4 billion riyals in 1995 to investors to set up 82 new industrial projects and expand another 23 projects. - Agriculture minister to meet founders of the new Saudi Agricultural Marketing Company next month. Saudi investors will provide 60 percent of the paid in capital of the 500 million riyal firm and the rest will be offered to the public. ARAB NEWS - Saudi flag carrier Saudi Arabian Airlines to resume direct Dhahran-Cairo flights in the first week of December after a gap of more than 15 years. Officials said it would operate three flights a week on Mondays, Wednesdays and Fridays. - General Electric of the United States has been awarded a 5.14 billion riyal contract to build a 1,300-megawatt gas power station near Riyadh. 2965 !GCAT !GDIP !GVIO Iraq on Sunday lashed out at the United States for its protection of rebel Kurds in the north of the country and lambasted its eastern neighbour Iran for aiding a main faction in inter-Kurdish fighting there. "Time has come for the voices of our noble people in the autonomous area (Iraqi Kurdistan) to be raised against this criminal American ploy which has no aim other than inflicting harm on Iraq and its people," Deputy Prime Minister Tareq Aziz said in a statement to the official Iraqi News Agency (INA). He accused Iran of taking sides in the latest flare-up of fighting between rival Kurdish factions and described Tehran's action as "hostile, flagrant...and harbouring serious expansionist tendencies". The ruling Baath party newspaper al-Thawra said U.S. policy toward Iraq encouraged "Iranian rats to leave their holes". It warned Iran not to take the current situation in the area as a pretext to meddle in Iraq's affairs. Last month Iran sent a small force into northern Iraq in pursuit of the rebels of Kurdistan Democratic Party of Iran (KDPI). The thrust also drew condemnation from Iraq. The latest fighting in northern Iraq pit guerrillas of the Kurdish warlord Jalal Talabani of the Patriotic Union of Kurdistan (PUK) against rebels of Massoud Barzani, head of the Kurdistan Democratic Party (KDP). Washington brokered a ceasefire between them on Friday and persuaded them to attend peace talks next month. Britain on Saturday offered to host the talks. A similar ceasefire agreed under Washington's auspices last year failed to solve the differences between Talabani and Barzani on how to run their breakaway enclave which they have divided into two separate spheres of influence. A U.S.-led airforce in southern Turkey guards Iraqi rebel Kurds against any possible military attacks by Baghdad since the Gulf War in 1991. Aziz said the force was "illegitimate" and its presence in Turkey was "a matter of ridicule" since it has so far failed to provide stability to the Kurdish region. Both Barzani and Iraq accuse Talabani of liaising with Tehran in the latest fighting. Iraq's official press has been critical of Talabani and last week published overtures to lure Barzani to Baghdad's camp. Sunday's official newspapers published the full text of a statement Barzani's KDP issued last week, accusing Tehran of sending troops to back Talabani's guerrillas. Talabani's PUK also accused Baghdad of shelling areas under its control. Aziz said Iran's armed forces and Revolutionary Guards took part in the clashes, using rocket launchers and heavy artillery. "Those who provided the chance for this Iranian interference, particularly the opportunist agent Jalal Talabani, prove by this conduct their treason and treachery of both Iraqi and Kurdish citizens," Aziz said. 2966 !GCAT These are the leading stories in the Egyptian press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. AL-AHRAM - IMF tells Middle East News Agency in Washington that Egypt has succeeded in creating appropriate atmosphere to attract investors. - Finance minister tells conference in Alexandria that 120 international investment funds trade in Egyptian stock market and announces new tourism projects worth 13 billion pounds. - Writer Ahmed Bahaa el-Deen dies after long illness. - 51 percent of 11 housing companies to be sold to private sector. - Archaeologists find pharaonic pots that may reveal secrets of mummification. AL-AKHBAR - Agriculture Minister Youssef Wali tells youth conference that land set aside for graduates has produced harvest worth a billion pounds. - Thieves getaway with 560,000 pounds from exchange bureau. AL-GOMHURIA - Finance minister says land will be given free or rented for symbolic fee to companies in western desert to encourage investment. - Senior presidential adviser Osama el-Baz says Egypt plays important role in creating stability and balance in the Middle East. - Public enterprise minister says shares in 10 construction companies will be floated on stock market within the next year. AL-WAFD - IMF criticises inflation in Egypt's foreign reserves. 2967 !GCAT These are some of the leading stories in the Kuwaiti press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. AL-QABAS - Social affairs and labour minister says Kuwait could allow private sector to bring in more foreign workers after study of market needs. Kuwait places restrictions on the employment of foreign workers to curb the rise in its expatriate population. - Investment company study says volume at the Kuwait Stock Exchange rose 40 percent in second quarter of 1996. AL-SEYASSAH - Hunger strike at the central prison to demand better living conditions. - Parliament halts municipality budget over removal of farms established on state-owned land. AL-RAI AL-AAM - Ministry of commerce and industry to monitor prices of goods displayed in exhibitions. 2968 !GCAT These are some of the leading stories in the Bahraini press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. AL-AYAM - Government and United Nations Development Programme to carry out projects in Bahrain. AKHBAR AL-KHALEEJ - Algerian president sends message to Bahrain's emir on bilateral relations. - Awarding contract for new power and water plant expected later this year. GULF DAILY NEWS - Bahrain invited to attend conference of Islamic Chamber of Commerce and Industry. Meeting to be held in Jakarta in October to discuss role of private sector in Moslem states. 2969 !GCAT These are some of the leading stories in the United Arab Emirates press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. AL-ITTIHAD - Syrian President Hafez al-Assad says Netanyahu closes the door to negotiations. - Fujairah chamber of commerce in talks with French commerce representative. AL-KHALEEJ - Head of Saudi chamber of commerce and industry warns of piracy against Gulf ships in the South China Sea. GULF NEWS - New UAE insurance company Al Khazna expects total profits of up to 46 percent of its capital in first year of operation. - Rice merchants in Dubai feel the pinch as traditional re-export markets dry up. KHALEEJ TIMES - Illegal immigrants causing security problems, officials say, warning against violation of the new immigration law. - Number of Gulf manufacturing firms grow 4.2 percent in 1995, Gulf Organisation for Industrial Consulting report says. 2970 !GCAT !GPOL Israeli President Ezer Weizman said on Sunday he would meet Palestinian leader Yasser Arafat at his private residence in central Israel but no date had been set. "After an exchange of opinions, we agreed that the meeting would be held -- no date was set -- in my house, which is the most appropriate place," Weizman told reporters after holding talks with Prime Minister Benjamin Netanyahu. Weizman confirmed he had received a letter from Arafat "in which he spelled out his troubles and problems and said 'I hope we will meet soon'". "After the letter was translated to Hebrew, I invited the prime minister to see me last Tuesday. I showed him the letter. He read it carefully. Afterwards I told him, 'Look I want to agree to his request and meet him and I propose I do so in (my private residence in) Caesarea," Weizman said. Israel's biggest daily Yedioth Ahronoth reported that Netanyahu had opposed the idea and that Weizman had threatened to meet Arafat over the objections of the prime minister. "There was no ultimatum. I am not a child who tells the prime minister, either you meet him or I will," said Weizman, who has met Arafat once, at the 1994 inauguration of South African President Nelson Mandela. 2971 !GCAT These are some of the leading stories in the official Iraqi press on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. JUMHOURIYA - Greece shows desire to resume trade ties with Iraq. - Iraq's Aziz denounces Iran's meddling in Kurdish affairs in northern Iraq. - Kurdistan Democratic Party of warlord Massoud Barzani urges Iraqi people to stand against Iran's interference in Iraqi Kurdistan. - Turkish pharmaceutical firms hold exhibition in Iraq. - National Assembly reviews situation of Iraqi POWs in Iran. - Proposals to curb tax evasion and improve tax collection in Iraq. THAWRA - President Saddam Hussein chairs joint meeting of Revolutionary Command Council and leaders of the ruling Baath party. - Canadian parliamentary delegation tours Iraqi hospitals. QADISSIYA - Irrigation ministry draws plan to clean canals and water systems in southern Iraq. 2972 !GCAT !GPOL Israeli President Ezer Weizman, weighing a possible meeting with Yasser Arafat, consulted on Sunday with Prime Minister Benjamin Netanyahu, a spokesman said. Weizman and Netanyahu met at the president's official Jerusalem residence and planned to speak to the media at the end of their talks, the prime minister's spokesman said. Earlier, the director of the president's office denied a report in Israel's Yedioth Ahronoth newspaper that Weizman had already invited Arafat to his private home for talks in the coming week on the future of the Israel-PLO peace process. But the official, Aryeh Shumer, said it was only fitting that Weizman and Arafat should talk after the Palestinian leader sent the Israeli president a letter which Yedioth Ahronoth reported contained an emotional appeal to save the peace proces. The newspaper said Netanyahu, who is cool to meeting Arafat himself, opposed talks between Weizman and the Palestinian president. After Moslem suicide bombers killed 59 people in Israel in February and March, Weizman called for peace efforts with the PLO to be suspended. Shumer said his current position was that the peace process must continue. 2973 !GCAT These are some of the leading stories in Israeli newspapers on Sunday. Reuters has not verified these stories and does not vouch for their accuracy. HAARETZ - Palestinian President Arafat opens civilian struggle against Israel, calls on Palestinians to build in self-rule areas. - Seven ministers and governor of Bank of Israel will visit the United States at the end of September and in October. - Israel bans plane donated by the Netherlands to Arafat to land at Gaza airport. - Former prime minister Peres to Morocco today. YEDIOTH AHRONOTH - Israeli President Weizman invited Palestinian President Arafat to meet him at his private residence. - Netanyahu opposes transit camps for foreign workers facing expulsion. - Foreign Minister Levy to visit Egypt soon. MAARIV - Palestinian Authority has taken over education in East Jerusalem. - Syrian armoured columns on the move in Lebanon. - Shimon Peres to Morocco, will stay at king's private residence. JERUSALEM POST - Palestinian Minister Erekat says Israel-PLO talks will begin by September 2. - Prime minister names former general Avraham Tamir to staff after failing to establish national security council. - Cabinet puts off decision on foreign workers. - Internal Security Minister Kahalani warns cabinet of increase in organised crime. 2974 !GCAT !GODD For years cafes in Cairo meant thick scented hookah smoke and tinkling glasses of sugary mint tea. This year some coffehouses have shed their traditional image to become a Cairene sign of the times. There's no backgammon and Egyptian ballads here -- patrons at Cairo's two cybercafes surf, hang out and chill to the latest pop tunes on compact disc. The Internet, not the crowd, is the main attraction and coffee is not a mere shouted order but a perculator away. "What prompted us to open a cybercafe was the frequent questions of people as to where they can go to access the Internet," said Dr Mona el-Kaddah, vice president of Internet Egypt, the private firm which runs the cafes. "It's a place where people can use the Net, meet and share experiences, give each other ideas and of course socialise through the Internet scene," she added. Local and foreign students, academics and businessmen are among the many Web surfers who throng to the computer screens at the cybercafes, one in the city centre and one at a shopping mall in a posh suburb. "I can have an e-mail account or access from the house but I prefer to come here," said Mohammed Abdel Rahman, a university student who comes to the cafe regularly. "I can come here and have a coffee, meet my friends, play with the computer and not only get information but I can have fun too," he added. "For 10 pounds ($3) an hour, its cheaper than shooting pool." Young patrons crowd around downloaded Music Television (MTV) videos and sports news while others exchange greetings over the sound of Nirvana and the occassional Mozart. Others relax in the reading room overlooking the Nile. "I've been to cafes in the States and Holland, and the computing facilities in this place are definitely tops," said American Keith Brafford, who ran into the cybercafe while on holiday in Egypt. Three years ago the government, in association with the Foreign Relations Coordination Unit of the Supreme Council of Universities, put Egypt online and now estimates there are more than 200,000 Internet users among its 60 million people. Access via a leased line costs 15,000 to 20,000 pounds a year but users can surf the information superhighway for rates of around 1,000 pounds a year through a dial-up number. And unlike in other Middle East countries where governments restrict usage, anyone with a computer and an international phone line can access absolutely anything on the Internet -- a fact which has brought jitters to Egypt's conservative society. "Security and morality on the Internet are worldwide issues for discussion. We cannot ban such a major information source just because misuse happens everywhere," said Dr Tarek Kamel of the state's Regional Information Technology and Software Engineering Centre (RITSEC). Although the state is promoting the Internet as its latest tool for economic, tourist and social development, the media has capitalised on its smuttier side. Stories of teenagers downloading pornography and paedophilia in other countries and tampering with files of the defence and justice ministries make the front page of Egypt's newspapers. Local technology advances are buried deep inside. "What about the video and the satellite dish?" Kaddah tells the Internet's opponents. "We try hard to guide the young people towards constructive information resources at our cybercafes and we make them sign a code of ethics when they join us so that they are aware of what things are acceptable to our society and what things are not. Until now, we haven't had any problems," she added. Their buzzing cybercafes have prompted Internet Egypt, one of 14 firms selling Internet services in Egypt, to think of opening more sites in Cairo and nationwide. Other companies are also planning to jump on the bandwagon. But users tend to come from the upper to upper middle income bracket, a minority among Egypt's teeming population. Most Egyptians remain loyal to their waterpipes. "I've got my traditional cafe with its drinks and hookahs where I go to relax. Why would I ever go to a cybercafe, work on a computer and use my brain?" said cafe customer Gamal Gadd al-Karim. 2975 !GCAT !GPOL !GVOTE Voting began on Sunday in north Lebanon in the second round of parliamentary elections with 580,000 voters eligible to choose 28 members of the 128-member parliament. A thin trickle of voters began casting their ballots in this northern port city for the five rival lists of candidates as polling stations opened at 7 a.m. (0400 gmt). 2976 !GCAT !GPOL Israeli President Ezer Weizman has invited Yasser Arafat to meet him at his private home, Israel's biggest newspaper said on Sunday. The Yedioth Ahronoth daily reported that Prime Minister Benjamin Netanyahu, who has said he has no desire to hold talks with the Palestinian president, opposes the meeting due to be held this coming week. The newspaper said Weizman scheduled the meeting at his private residence in the central Israeli village of Caesarea after Arafat sent him an emotional appeal "to save the peace process". Netanyahu met Weizman last Tuesday and voiced his opposition, Yedioth said. "I am prepared to postpone the meeting under one condition -- that you give me a commitment right now to meet Arafat yourself within 10 days," the paper quoted Weizman as telling Netanyahu. It said Netanyahu had yet to give Weizman an answer. The office of Israeli president is largely ceremonial. But Weizman, a former defence minister and an architect of Israel's peace treaty with Egypt, has spoken out frequently on the peace process with the Palestinians -- at times urging the former Labour government to slow it down. 2977 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Corporate America is planning major changes in employee compensation in the next few years, according to a recent study. What it comes down to is this: If you're highly skilled, you'll benefit nicely. But if you're not and cannot contribute to your employer's goals, you'll be paid less. The survey, conducted in late 1995 and the early part of this year by management consulting firm Towers Perrin, showed that the focus will be on an employee's overall value to the company's bottom line -- rather than how well an employee performs a specific task. Presently, for example, if an accountant's job involves doing five specific tasks, he or she can expect a certain salary, said Sandra O'Neal, a Towers Perrin principal. In the future, the accountant will be evaluated solely on "knowledge, skill and abilities," she said. In addition to using accounting skills, the accountant will also have to be creative, work well in a team, be sensitive to customer needs and set productivity goals. "The good news is, if you're highly skilled and have many abilities, you'll be paid more," said O'Neal. "The bad news is, if you're not skilled and can't contribute to a team, to customer service and the organisation's goals, you'll be paid less." Of the 750 mid-to-large size corporations surveyed, 81 percent had undergone a major restructuring in the last three years, and more than two-thirds reported that productivity and profits were up as result. Next on the agenda for these firms is developing a new compensation structure, and 78 percent report that they are considering a new, skills-based plan for both management and non-management employees. This coming shift, O'Neal said, "is not just isolated or a fad. It's an inexorable change." After World War II, corporations adopted a "military model" creating hierarchical organisations where "the concept of defined tasks worked great," she said. But as the economy became global, customers were more demanding and problems became more complex. "Multi-layers kept management at a distance from its customers," O'Neal said. Now organisations must change to stay competitive. O'Neal says firms will place a greater emphasis on teams and team performance in giving raises. If your team does well, you'll do well. If it doesn't do well, don't expect a raise. Is this fair to an employee who can go the distance but is on a team that can't keep up? "That's an important question we used to ask a lot," said O'Neal. "It's not a question we ask any more. The more important question is -- 'Do we have results?'" To get those results, 27 percent of the companies surveyed plan to eliminate base pay increases in favour of cash bonuses and incentives, such as employee and team award programmes and education. Companies that can change their culture and view employees as business partners will do well, O'Neal said. For example, the survey rated some participants in the survey as "high-performing" companies, based on their return on equity above 16 percent. Those companies also said they already offer employees variable pay and business education, give their managers more control over pay decisions and celebrate employee and team success. "They respect employees more, they trust employees more and they value their employees more," O'Neal said. "The key to success at high-performance companies is engaging employees in a business partnership. It will improve a company's bottom line." 2978 !GCAT !GPOL !GVOTE Democrats gathered in this sparkling lakeside city on Sunday for a presidential convention designed to launch Bill Clinton towards a second term and banish shameful memories of their last, disastrous Chicago meeting. Everything seemed to be going their way on the eve of a four-day Democratic Party love-fest that will re-nominate Clinton on Wednesday: a festive atmosphere, a handsome lakeside city at its strutting, party-time best, some glorious weather and an oh-so-polite police force. There were even slight rises in Clinton's poll ratings to top things off. "I'm on my way to Chicago, and I'm going by train because I want to see people like you that I've been working for and fighting for ... and because I want America to know we are on the right track," Clinton told a cheering crowd at a railway station in Huntington, West Virginia at the start of a four-day "whistle stop" campaign trip to Chicago. Vice President Al Gore, who preceded Clinton into the city to warm up the festivities, let loose an unusually harsh personal attack on their resurgent Republican opponent, Bob Dole, and his political ally, House of Representatives Speaker Newt Gingrich. "With equal measures of ignorance and audacity this two headed monster of Dole and Gingrich has been launching an all out assault on decades of progress on behalf of working men and women," Gore said at a boistrous rally of labour union members. But he urged the unions not to get cocky, saying, "This is going to be a close race, a hard fought race. We need you." Clinton too is well aware he has serious work to do to stop Dole becoming America's 1996 "Comeback Kid," a role he himself invented four years ago when he upset then-President George Bush and broke a tight Republican grip on the White House. The prospect of an astonishing Dole rebound no longer seems as far-fetched as it did before the August 12-15 Republican convention in San Diego, which gave the 73-year-old former Senate leader a big boost. Polls still put Clinton from five to 12 points up on Dole with Reform Party challenger Ross Perot far behind. But that is a far cry from the 20-30 point lead Clinton enjoyed before Dole and running mate Jack Kemp took the limelight in San Diego. The Republican conclave demonstrated that conventions can still change the dynamics of a presidential race, even though they are now commonly derided as meaningless rituals. The Republicans can at least now dream of putting Dole into the White House next January, and he brought his challenge right into the Democrats' turf on Sunday with a campaign rally attacking Clinton's record in a town near Chicago. Clinton ironically has to start the job of blocking Dole's post convention momentum in Chicago -- a city which has long been a historic place of shame for Democrats. At their last Chicago convention in 1968, raucous anti-Vietnam war demonstrations were met with a brutal police crackdown. Scenes of flailing police billyclubs and wafting teargas were beamed to shocked tv audiences worldwide. Then-Vice President Hubert Humphrey won the nomination inside a bitterly divided convention hall, but he effectively lost all chance of defeating Richard Nixon in an election that began a long Republican domination of the presidency. Chicago hopes to wipe out that stain with a blend of sugar and spice. Its police force has been trained -- with films of the '68 debacle to hammer home the point -- to provide firm but restrained security in an era more worried by acts of terror than political protests. The city itself, filled with good restaurants, jazz clubs and nightlife of all sorts, is out to show fun-seeking convention delegates that, in the grammatically garbled words of the old Frank Sinatra tune, their kind of town Chicago is. Clinton aimed to start nailing down the lid on any Dole revival -- all along his train route through West Virginia, Kentucky, Ohio, Michigan and Indiana, and then at the convention itself -- by stressing a theme, the future versus the past. This allows him to underscore his rival's advanced age and identity with the World War II generation without seeming mean or disrespectful of a wounded war hero. 2979 !E21 !E211 !ECAT !GCAT !GPOL !GVOTE Riding the rails to Chicago, President Bill Clinton urged Americans on Sunday to reject Republican Bob Dole's proposed across-the-board tax cut, saying it sounds good but would "blow a hole" in the national budget deficit and trigger economic disaster. On the first day of a four-day whistle-stop train tour through middle America that will take him to the Democratic National Convention in Chicago, Clinton urged Americans to "stay on the right track" and give him a second four-year term. His "21st Century Express" chugged through rolling, coal-rich Appalachian hills from its starting point at Huntington, W.Va., and came to a stop on the banks of the Ohio River in Ashland, where hundreds of people waving "Clinton-Gore" signs greeted him under a blazing sun. There, he took dead aim at Dole's campaign pledge to give Americans a 15 percent, across-the-board tax cut that the Republican nominee says will help middle-class voters. "We can't afford it," said Clinton. Clinton said his own more modest tax-cut proposals are affordable and targeted toward education and first-time homebuyers and that Dole's would return America to the days of 1980s tax cuts under Republican President Ronald Reagan that led to skyrocketing annual budget deficits and a legacy of national debt. "You look at that train there," Clinton said. "If you were on that train going to your destination, which is the 21st century, the last thing in the wide world you want to do is to make a U-turn because you heard a pretty song somewhere along the way. That's a pretty song, that big ole tax cut." He said the tax cut would "blow a hole in the deficit" and trigger higher interest rates that would hit Americans with higher mortgage payments, credit card payments and bigger cuts in Medicare and Medicaid health insurance for the poor and elderly. With Clinton was Kentucky's Democratic Gov. Paul Patton, who said his tobacco-rich state largely supported the president except for his imposition last week of strict rules on tobacco aimed at keeping young people from smoking. "Mr. President, many of us disagree with you on tobacco, but we love you," he said. Kentucky native Billy Ray Cyrus, a country music singer, sang the national anthem, performed his hit song "Achy Breaky Heart" with pro-Clinton verses substituted, and delivered his own political speech: "The steel mills, the coal mines, the train tracks -- this is America." Clinton was to enter parts of five states on his ride to Chicago. After Ashland his next stop was Chillicothe, Ohio. Whistle-stop campaigning goes back over a century in America but in recent decades politicians have tried to emulate the legendary 1948 tour that Harry Truman rode to an improbable come-from-behind election. Clinton hopes the train tour will generate some excitement and momentum going into Chicago and help negate a rise in the polls by Dole on the strength of the Republican convention in San Diego. The president plans to make news with some policy initiatives almost every day -- anti-crime on Monday, education on Tuesday and the environment on Wednesday, to add to a string of major bill-signings last week that kept him in the public eye. On his departure from Huntington, the crowd spilled off the grounds of the train station and gave an enthusiastic welcome to Clinton, his wife Hillary and daughter Chelsea as they began their journey under a cloudless blue sky. The president and his immediate entourage were travelling in two vintage "office cars" at the tail end of the 13-car, three-engine train. Clinton's car is the Georgia 300, also named the General Polk. The luxury car frequently carried President Franklin Roosevelt to his summer vacation home in Warm Springs, Ga. 2980 !GCAT !GCRIM !GPOL Campaigning within shouting distance of Chicago on the eve of the Democratic convention, Republican presidential candidate Bob Dole on Sunday vowed an all-out war on illegal drugs which he decried as the "moral equivalent" of terrorism. Harshly attacking the White House for what he called a "Don't Worry, Be Happy" stance on drugs, Dole promised to deploy all resources necessary to fight drugs -- including the army, the navy, the Coast Guard, the Central Intelligence Agency and the National Guard. Citing the study released last week that showed that drug abuse has doubled since President Bill Clinton took office, Dole blasted what he characterised as a "Don't Worry, Be Happy" attitude of the Democratic administration. "This president has been known not for his eloquence but his silence," he said. "This administration replaced the unambiguous message of "Just say no" with this message: 'Just say nothing.'" "We will treat drugs for what they are -- the moral equivalent of terrorism," Dole said. "The terrorism of drugs destroys our young peole and hijacks America's future." Breaking with a tradition in which candidates do not venture close to their opponents' nominating conventions, Dole made the speech at a picnic and rally in a park in affluent suburbs southwest of Chicago, where the Democratic convention begins on Monday. Dole campaigns in Oregon later on Sunday, and starts a working vacation in Santa Barbara, California, on Monday. In a speech that dwelt far more on stopping drug traffic than on prevention and education, Dole noted the traditional reluctance to use the military to confront domestic problems but said drugs come from abroad and are thus not only a home-grown problem. He said that if elected he would call on his defence secretary and military leaders to draw up battle plans for the war on drugs, including contingency plans for interdiction along the southern U.S. border. "Now, one would hope that such interdiction by U.S. military forces would never need to take place. But just as U.S. combat readiness is a deterrent to those who would challenge us in a war, so will the knowledge that all the capabilities -- I said all the capabilities -- of our federal government will be used to reduce the flow of drugs across our border if necessary,"he said. In an oblique reference to recent reports that some White House staffers had used drugs in the past, he said his own stance would be "zero tolerance" from the White House on down to every workplace and school in America. "In the Dole administration we're going to return to what works -- a clear and forceful policy of zero tolerance. That's zero tolerance. Zero tolerance for drug sumugglers, zero tolerance for drug pushers. Zero tolerance for drugs in the workplace and zero tolerance for illegal drugs period. Zero. Zero. Zero." 2981 !GCAT !GDEF !GDIP U.S. intelligence officials have concluded that Pakistan was secretly building a factory to make a medium-range missile using blueprints and equipment supplied by China, the Washington Post reported on Sunday. U.S. government officials would not confirm the report, which quoted an intelligence report as concluding Pakistan may have developed nuclear warheads to be placed atop the M-11 missiles. Pakistan was not a declared nuclear power but U.S. experts believe it capable of producing nuclear weapons quickly. The existence of such a missile plant would add a new dimension to collaboration between the two states, including the military and nuclear fields. This has troubled Washington and was a factor in a souring of Sino-U.S. relations last year. A White House spokesman said he could not confirm the story but said the United States took such reports seriously. "We do not believe it is in the best interests of the United States or of any other country to supply Pakistan with the capacity to manufacture or deploy weapons of mass destruction," the spokesman said. The Washington Post said the partially completed factory in a suburb of the northern city of Rawalpindi was expected to be capable of producing most of the major components of a missile modelled on the Chinese-designed M-11 in a year or two. The same newspaper reported in June that U.S. intelligence agenices had "unanimously concluded" that Pakistan had already obtained complete M-11 missiles from China, but both China and Pakistan denied that report. The United States has twice imposed limited economic sanctions against China for selling M-11 missile launchers and missile components to Pakistan, but withdrew them after China promised to stop such deliveries. Washington recently settled another dispute with China over a sale to Pakistan of nuclear-related equipment. U.S. Vice President Al Gore said the United States had an "active, vigorous programme of monitoring all exchanges of technology from China or any other country that might violate" international agreements or treaties. "We expect that they will comply with the provisions of the laws and treaties involved," Gore said in an interview on ABC's "This Week with David Brinkley" programme. The Post quoted officials as saying the construction of the missile factory raised the possibility that broad economic sanctions eventually could be imposed on both countries. However, the White House spokesman suggested sanctions were not immediately in the offing. "We have not come to any conclusions that would warrant sanctions at this time with respect to Pakistan or China," he said. The Washington Post said the existence of the Pakistani factory had been known to U.S. intelligence officials since last year when construction evidently began. The White House has sought better relations with China after months of disputes over Taiwan, trade and human rights. Gore said a visit to Beijing by U.S. National Security Adviser Tony Lake last month resulted in a "much more productive and open" dialogue. Pakistan has depended increasingly on Chinese help to meet its defence needs because of virtual rupture in military ties with the United States since 1990 due to suspicions about Pakistan's nuclear programme. The sanctions were eased this year when the U.S. Congress approved delivery of some blocked equipment that was already paid for. 2982 !GCAT !GWEA Hurricane Edouard quickly developed into a potentially deadly storm with winds clocked at 140 mph (245 kmh) by Saturday evening as it swirled through the open Atlantic, the National Hurricane Center said. The rapid organization of the storm's eyewall and intensity of its winds made forecasters declare Edouard a Category 4 hurricane, a dangerous storm capable of massive destruction. Exactly four years ago on Aug. 24, another Category 4 storm, Hurricane Andrew, slammed into south Florida and caused more than $20 billion worth of damage and left a quarter of a million people homeless. At 11 p.m. EDT (0300 GMT Sunday), Edouard was located at latitude 15.3 north and longitude 46.4 west, or about 1,000 miles (1,600 km) east of the Lesser Antilles, forecasters said. They said Edouard remained far from the Caribbean or U.S. coastline, making it difficult to predict where it might eventually make landfall in mid-week. The hurricane changed its direction slightly, and was moving west-northwest at 14 mph (25 kmh). It had maximum sustained winds of 140 mph (245 kmh), and was a small, compact storm. A catastrophic Category 5 hurricane is declared when maximum winds top 155 mph (275 kmh). Early on Saturday, Edouard was classified as a minimal hurricane with maximum winds of 80 mph (140 kmh). The sixth tropical depression of the Atlantic hurricane season also emerged on Saturday. It carried maximum winds of 35 mph (62 kmh) and was located 500 miles (880 km) west of Cape Verde. 2983 !GCAT !GENT !GPRO Pop singer Madonna has paid $2.7 million for a 1920s home in Los Angeles, a property about half the size of the nearby residence she has been trying to sell, the Los Angeles Times reported on Sunday. "She's scaling down," the paper quoted a source as saying. Her new purchase boasts a 3,500-square-foot (325 square-metre) main house with five bedrooms and a two-bedroom guest house. The recently restored Mediterranean-style house is in the tree-lined suburb of Los Feliz, and had been listed at $3.2 million. Her current 7,800-square foot (650-square-metre) home that overlooks the HOLLYWOOD sign has been on the market for some time, most recently at $6.5 million, the paper said. Madonna reportedly spends most of the time in her Miami residence, and she also has a place in Manhattan. She is currently awaiting the birth of her first child and the December release of her new movie, "Evita." 2984 !GCAT !GPOL The aging, worn-out warriors whose anti-Vietnam War protests convulsed the Democratic convention in 1968 returned in triumph "to the scene of the crime" on Sunday and were welcomed by the mayor whose father set the police on them. It was a case of letting bygones be bygones on the eve of the first time in 28 years that the Democrats have dared to hold their national convention in the Midwest's largest city, so brutal was their reception the last time. Mayor Richard Daley welcomed Tom Hayden, Bobby Seale, David Dellinger and other surviving members of the group known as the Chicago Seven to a three-hour reconciliation rally and songfest where the hit tunes of the protest movement were played by Bonnie Raitt, Jackson Browne and two-thirds of Crosby, Stills and Nash. Moments after the fully clothed cast of "Hair" sang "This is the dawning of the age of Aquarius," the mayor stepped to a barely lit podium not to offer an apology, but a welcome -- something his tough, no-nonsense father would never have done. "You are welcome today. We can't bring back Martin Luther King Jr. or Bobby Kennedy. We can't change the past, but we can learn from it ... The challenges of today are too great to keep fighting the past," he said, referring to two heroes of the 1960s assassinated in that year, 1968. The rally was sponsored by the Nation Magazine and the mayor skipped out as quickly and as quietly as he could -- long before giant images of police beating demonstrators were shown, long before haughty pictures of his father and Judge Julius Hoffman were shown. The judge presided over a 5 1/2 month trial that bordered on farce when it did not actually cross that border. He ordered Seale, the rapid-speaking founder of the Black Panthers, bound and gagged because he wanted to defend himself and sentenced the other defendants and their lawyers to long prison terms for "contempt of court" because they broke into his comments from the bench and ridiculed him. The sentences were later overturned and an official commission accused the Chicago police of staging "a riot" against the protesters. Hayden, now a California state senator and establishment politician, joked, as did the other defendants who came back, that he was "returning to the scene of the crime." The defendants climbed the stage with their families as a crowd of almost 1,500 cheered what was called, "family values from the Chicago conspiracy." But Andrew Hoffman, 35, the son of Abbie Hoffman, the clown prince of Vietnam protests, refused to go on stage because, "my father would not have done it. It would be an establishment act. I am continuing in my father's business." Instead he stood outside the door, selling "Chicago police" t-shirts that said, "We kicked your father's ass in 1968. Wait 'til you see what we do to you." Abbie Hoffman and Jerry Rubin were the only two members of the group to have died. A third member, Lee Weiner, did not attend the rally because of long-standing disagreements with Hayden. But Paul Krassner, a co-founder of the Youth International Movement, was at the rally explaining to reporters that there were two words he created that have entered the English language. One was "Yippie" for the movement that combined practical jokes with political seriousness, and "soft-core pornography." Krassner had testified at the trial after taking a large dose of LSD. He said he took the drug because he hoped it would make him vomit in the dock. But it didn't. "Instead I gave very surreal testimony, like when I tried to remember the word Chicago," he said. 2985 !GCAT !GDEF The Citadel's class of 2000 -- including the first four women ever admitted -- spent Sunday gearing up for a pre-dawn wake up call that will launch "Hell Week", a brutal indoctrination into the rigours of the previously all-male military college. Joseph Trez, the commandant in charge of training, said on Sunday the four women and their 564 male classmates were getting ready with a programme of church, academic orientation, and exercise. "They're acting just as you'd expect fourth-classmen to act," he said. The state-funded Citadel changed its all-male policy this summer after the U.S. Supreme Court said a similar rule at Virginia Military Institution was unconstitutional. Last year, Shannon Faulkner was admitted to The Citadel under a federal court order, but dropped out after a week, citing stress. Four of the seven women accepted this year by The Citadel enrolled Saturday: Petra Lovetinska of Washington, D.C., Jeanie Mentavlos of Charlotte, N.C., Nancy Mace of Goose Creek, S.C., and Kim Messer of Clover, S.C. Bryant Butler, a senior who is the regimental commander, said on Sunday he had heard nothing but positive comments about the arrival of women on campus, and expects that to continue when the upperclassmen arrive next week. "You will always have that little 5 percent that will have a problem with it," he said. "I look at it as another step in my development at The Citadel." Monday morning, the students begin Cadre Week, known as "Hell Week." The cadre, the upperclassmen responsible for training, tear them down psychologically, stripping away their individuality so they can resurrect a tight, well-honed unit. "Some of those here now will be totally different a year from now," said Shaun King, a senior. Among the rules, Freshmen must walk in the gutters and square all corners. No fewer than 120 steps per minute is tolerated. "Smiling and laughing is not encouraged," said Charles Perreault, a senior. The freshman "knobs" -- called such because their shaved head resembles a knob -- can talk only in their rooms or in class, and must always look straight ahead. The spartan code means no televisions and no phones. On Monday, the day begins with 5:20 a.m. reveille, 6:10 a.m. breakfast and a 7 a.m. address from Trez and Butler. The schedule says lights out at 10:30 p.m. But anyone familiar with The Citadel knows that is a ruse. Hell Week means no sleep. At some point each night, the knobs will be roused from bed to paint floors, walk the quadrangle or some other duty. The attrition rate varies from year to year, Trez said. Last year, 101 left, most of them during the first two weeks. 2986 !C12 !CCAT !GCAT !GCRIM A lawyer for U.S. investors who blocked the reorganization plan of insurance market Lloyd's of London said on Sunday Lloyd's has asked an appeals court to overturn the lower court's ruling thwarting its financial recovery. The motion to stay was expected as Lloyd's was preparing to exhaust all measures to proceed with its scheduled Aug. 28 vote on the reorganization plan. Susan Cahoon, one of the lawyers representing investors, told Reuters that Lloyd's had filed a 52-page motion for a panel of appeals judges to consider on Tuesday, a day before the vote. "We just received by fax a motion asking the 4th Circuit Court of Appeals to stay the preliminary injunction -- don't make Lloyd's comply while the 4th Circuit takes up the issue," Cahoon said in a telephone interview from her Atlanta law firm. On Friday, a U.S. federal judge in Richmond, Va. issued a preliminary injunction rendering Lloyd's "reconstruction and renewal" plan doubtful. Shortly afterwards a lawyer for the venerable institution said an appeal had already been filed. The plan called for investors to fund a newly formed reinsurance company, Equitas. But, already near financial ruin from existing Lloyd's investments, they were sceptical, claiming Lloyd's had not supplied them with sufficient information about Equitas and thus breached U.S. securities laws. Judge Robert Payne of the U.S. District Court for Eastern Virginia concurred and ordered Lloyd's to comply within a month. He ruled the 93 U.S. investors in the case would suffer irreparable harm if the preliminary injunction was denied. He said the purpose of the order was to protect Americans, the Lloyd's offer and Aug. 28 deadline to vote on it. The request for an emergency stay, according to Cahoon, "recounts many of the same arguments that Lloyd's made to the lower court: an English choice of laws question on are these or aren't these securities? It cites the dire consequences for Lloyds, and says that the deadlines are fixed and immutable." She said a response would be filed to the judges on behalf of the plaintiffs, asking the appeals court to deny the motion. Lawyers for Lloyd's were not available for comment. In Friday's order, Judge Payne also ruled "requiring Lloyd's to comply with its obligations under the U.S. securities laws would serve the public interest in full disclosure." Investors, whom Lloyd's calls Names -- individuals who pledge their assets to back the insurance policies sold at Lloyd's -- were being asked to pay up to $150,000 each to help fund Equitas, which would take responsibility for $12.4 billion in losses from asbestos, pollution, and disaster claims between 1988-92. Lloyd's is known for exotic, if sometimes risky, insurance policies as well as paying them in a timely manner throughout its 308-year-old history. It reportedly insured the Titanic, paid out claims for the 1906 San Francisco earthquake, covered Hitler's private Junkers airplane, and underwrote the San Francisco-Oakland Bay Bridge before hitting hard times. The ruling effectively blocks creation of Equitas, and Lloyd's has been given until Sept. 23, 1996 to see that American Names receive information on Equitas. There are 2,700 U.S. Names and 33,500 worldwide. Moreover, investors already leaning toward supporting the recovery plan can pay into an escrow account (in lieu of Equitas) set up by the court by Sept. 30. They then have until Oct. 30 to review the information and tell Lloyd's whether they accept the offer. If they accept, their funds will be released from the escrow account to Lloyd's; but if they reject the offer, their funds stay in escrow until the recovery plan is finalised. A trial date has already been set for Nov. 4, and that may not be the last of Lloyd's U.S. legal woes. Colorado Attorney General Gale Norton has told Lloyd's he is working on a new claim against the market on behalf of Names in that state. 2987 !GCAT !GPOL !GVOTE Republican presidential candidate Bob Dole is holding on to gains against President Bill Clinton since the Republican convention and was just five percentage points behind among likely voters, according to an ABC news survey released on Sunday. The poll of 1,206 likely voters conducted from Thursday through Saturday showed Clinton with 47 percent, Dole 42 percent and Texas billionaire Ross Perot with 7 percent. The gap between Clinton and Dole was wider, at nine percentage points, if the survey was of "registered" rather than "likely" voters. Clinton had 47 percent of registered voters, Dole 38 percent and Perot 9 percent. The sample size was larger for registered voters was larger at 1,513. Likely voters are those who say they are certain to vote. ABC said the survey of likely voters may be more indicative of how the race would turn out because Republicans are more likely to vote on election day. "Election day exit polls almost always show the Republican share of the final vote to be higher than the distribution of Republicans in the general public," ABC said. ABC cautioned that history suggests Clinton will get some sort of "bounce" in the polls from the Democratic national convention in Chicago this week, when the spotlight will be on him. "But as the delegates gathered this weekend, no Clinton bounce has been spotted yet," it said. The survey, conducted by Chilton Research Services, had a margin of error of plus or minus three percentage points. 2988 !GCAT !GDIS !GWEA Packing 145 mph (235 kmph) winds, Hurricane Edouard pushed across the Atlantic on Sunday, but forecasters said it was still too far from land to predict where the dangerous storm might strike. At 11 a.m. EDT (1500 GMT), the centre of Edouard was located 850 miles (1,365 km) west of the Caribbean's Leeward Islands, or at latitude 16.1 north and longitude 41.0 west. "This is a dangerous hurricane," said National Hurricane Centre forecaster Mike Hopkins. "But it's still premature to speculate about where, or if, it will make landfall by mid-week." Edouard, a compact and powerful storm, was swirling west- northwest at 14 mph (23 kmh). Hurricane forecasters said computer models showed Edouard was likely to remain strong for at least the next three days, due to favourable conditions for hurricanes in the Atlantic. "On its current course, it could miss the Caribbean islands, but we just can't make any predictions yet," Hopkins said. Meanwhile, tropical depression number six began falling apart off the west coast of Africa and forecasters said it was unlikely to pose any danger. At 11 a.m. EDT (1500 GMT), the depression was located about 650 miles west (1,045 km) of the Cape Verde Islands with winds of 35 mph (55 kph). The rapid organisation of the storm's eyewall and intensity of its winds made forecasters declare Edouard a Category 4 hurricane -- a dangerous storm capable of massive destruction. Hurricane forecasters rank storms in five categories, according to wind speed. Four years ago on Aug. 24, another Category 4 storm, Hurricane Andrew, slammed into south Florida and caused more than $20 billion worth of damage and left 250,000 people homeless. 2989 !GCAT !GPOL !GVOTE Democrats streamed into this sparkling Midwestern capital on Sunday for a political jamboree designed to banish memories of a riotous, hate-filled 1968 convention and to launch President Bill Clinton towards a second term. Everything seemed to be going the president's way on the eve of a four-day Democratic Party love-fest that will re-nominate him on Wednesday: a festive atmosphere, a handsome lakeside city at its strutting, party-time best, some glorious weather and an oh-so-polite police force. There were even slight rises in Clinton's poll ratings to top things off. "I'm on my way to Chicago, and I'm going by train because I want to see people like you that I've been working for and fighting for ... and because I want America to know we are on the right track," Clinton told a cheering crowd at a railway station in Huntington, West Virginia at the start of a four-day "whistle stop" campaign trip to Chicago. Even so Clinton was well aware he had serious work to do. He has to stop Republican Bob Dole becoming America's 1996 "Comeback Kid," a role Clinton himself invented four years ago when he upset then-President George Bush and broke a Republican grip on the White House. The prospect of an astonishing Dole rebound no longer seems as far-fetched as it did before the August 12-15 Republican convention in San Diego, which gave the 73-year-old former Senate leader a big boost. Polls still put Clinton from five to 12 points up on Dole with Reform Party challenger Ross Perot far behind. But that is a far cry from the 20-30 point lead Clinton enjoyed before Dole and running mate Jack Kemp took the limelight in San Diego. The Republican conclave demonstrated that conventions can still change the dynamics of a presidential race, even though they are now commonly derided as meaningless rituals. Clinton ironically has to start the job of blocking Dole's post convention momentum in Chicago -- a city which has long been a historic place of shame for Democrats. At their last Chicago convention in 1968, raucous anti-Vietnam war demonstrations were met with a brutal police crackdown. Scenes of flailing police billyclubs and wafting teargas were beamed to shocked tv audiences worldwide. Then-Vice President Hubert Humphrey won the nomination inside a bitterly divided convention hall, but he effectively lost all chance of defeating Richard Nixon in an election that began a long Republican domination of the presidency. Chicago hopes to wipe out that stain with a blend of sugar and spice. Its police force has been trained -- with films of the '68 debacle to hammer home the point -- to provide firm but restrained security in an era more worried by acts of terror than political protests. The city itself, filled with good restaurants, jazz clubs and nightlife of all sorts, is out to show fun-seeking convention delegates that, in the grammatically garbled words of the old Frank Sinatra tune, their kind of town Chicago is. Clinton for his part aimed to start nailing down the lid on any Dole revival -- all along his train route through West Virginia, Kentucky, Ohio, Michigan and Indiana, and then at the convention itself -- by stressing a theme, the future versus the past. This allows him to underscore his rival's advanced age and identity with the World War II generation without seeming mean or disrespectful of a wounded war hero. The 50-year-old president spelled that out in an interview with the Chicago Tribune, saying, "We should revere the past ... but we've got to build a pathway to the future." "Our sole concern ought to be, what's this country going to look like when we start the 21st Century ... That is really what this election ought to be about." He will take specific aim at Dole's controversial campaign promise of sweeping tax cuts, portraying them as economically irresponsible next to his own more modest pledges, and will accuse the Republicans of harbouring secret plans to slash popular programmes like Social Security and Medicare health insurance. 2990 !GCAT !GENT !GPOL !GVOTE The entertainment industry has contributed at least $23.5 million to the major political parties, political action committees and national candidates since 1991, the Los Angeles Times reported on Sunday. Citing an analysis of federal election records, the paper found that Hollywood overwhelmingly supported Democrats, contributing nearly 10 times as much money to the Democratic National Committee than to its Republican counterpart and seven times more to President Bill Clinton's re-election bid than to that of Republican Bob Dole. Among the biggest givers were all three members of DreamWorks SKG -- Steven Spielberg, Jeffrey Katzenberg and David Geffen -- who gave a total of nearly $1.5 million to Democratic causes, along with such famous personalities as Barbra Streisand, Dustin Hoffman and rock musician Don Henley. Streisand contributed more than $142,000, Henley $107,685 and Hoffman $96,500. Other big givers included Paul Newman with $72,500, jazz musician Lionel Hampton, $84,034, and Sylvester Stallone, $50,200. Stallone contributed $29,000 to Republicans and $21,000 to Democrats, the paper said. Film producer Steven Tisch gave $283,500. Appearing high on the list of industry givers were some relatively unfamiliar names. Gail Zappa, widow of rock musician Frank Zappa, gave $218,000 in political contributions, largely to Democrats. The biggest beneficiaries of Hollywood's generosity were California's two Democratic senators, Dianne Feinstein and Barbara Boxer, followed by former Representative Mel Levine, a Democrat whose district included Los Angeles' Westside. Feinstein received $589,609, Boxer $442,777 and Levine $401,625. Clinton's primary campaign ranked fifth in donations from the entertainment industry with $381,390, while Bob Dole came in 27th with $55,250. Ranked sixth was Sen. Edward Kennedy. The Massachusetts Democrat received $247,371. 2991 !GCAT !GPOL !GVOTE Urging Americans to "stay on the right track," President Bill Clinton embarked on Sunday on a four-day whistle-stop train tour of middle America hoping to generate popular enthusiasm for his re-election bid. "I've come here to say to you, I'm on my way to Chicago (for the Democratic National Convention)," Clinton told a crowd of several thousand at the Old C&O Train Station in Huntington in West Virginia. "And I'm going on a train, because I want to see the people like you that I've been working for and fighting for, for four years." After shaking hands, Clinton boarded the "21st Century Express" and it chugged away on a slow winding route that will take him through parts of five states before depositing him within helicopter range of Chicago, where he will deliver his renomination acceptance speech on Thursday. His first stop was Ashland, Kentucky, then he was to proceed on into Ohio for the evening. Then it's on to Michigan and Indiana. Whistle-stop campaigning goes back over a century in America but in recent decades politicians have tried to emulate the legendary 1948 tour that Harry Truman rode to an improbable come-from-behind election. Clinton hopes the train tour will generate some excitement and momentum going into Chicago and help negate a rise in the polls by Republican Bob Dole on the strength of the Republican convention in San Diego. The president plans to make news with some policy initiatives almost every day -- anti-crime on Monday, education on Tuesday and the environment on Wednesday, to add to a string of major bill-signings last week that kept him in the public eye. Presidential aides said Clinton on Monday will propose to expand the reach of the Brady Bill handgun control law to prevent people convicted of domestic violence from buying guns. It now prevents fugitives, felons and stalkers from buying them. White House press secretary Mike McCurry estimated the total cost of the initiatives Clinton will unveil during the train trip at $8 billion. The crowd in this coal-mining region spilled off the grounds of the train station and gave an enthusiastic welcome to Clinton, his wife Hillary and daughter Chelsea as they began their journey under a cloudless blue sky. "All Aboard for Clinton-Gore," said one sign waved by a Clinton supporter. Clinton told them his economic policies have caused the national budget deficit to drop four years in a row for the first time since the 1840s, generated 10 million new jobs, helped 4.5 million people buy new homes and 10 million refinance their mortages at lower interest rates. He skewered Republicans for shutting the government down last winter in a budget fight and for trying to block his efforts to preserve spending for education and the environment. "Shall we keep going on the right track or turn around?" said Clinton, his voice confident and booming. "Would you take a U-turn if you were going in the right direction?" "No," yelled the crowd. With Clinton was Democratic Sen. Jay Rockefeller, a wealthy West Virginian who decried Dole's plans for a 15-percent, across-the-board tax cut he said would mainly help the rich. "I don't need it," he said to cheers. Clinton was wearing a red, white and blue tie with American flags and donkeys on it. He said it had been given to him by his barber Sunday morning. "Figured I should wear it," he said. The president and his immediate entourage were travelling in two vintage "office cars" at the tail end of the 13-car, three-engine train. Clinton's car is the Georgia 300, also named the General Polk. The luxury car frequently carried President Franklin Roosevelt to his summer vacation home in Warm Springs, Ga. The second office car is the Missouri-Kansas-Texas 403, used by Truman during his 1948 tour. 2992 !E21 !E211 !ECAT !GCAT !GPOL The United States is headed toward a balanced budget following four consecutive years of declining deficits during the administration of President Bill Clinton, Vice President Al Gore said Sunday. Speaking on ABC's "This Week With David Brinkley" show from Chicago, where the Democratic national convention starts Monday, Gore hailed the Clinton economic record. "We have had faster growth in the private sector of our economy than under (former President) Ronald Reagan. We have had much lower inflation. The deficits have come down four years in a row for the first time since before the Civil War in a president's term. The debt, which was just ballooning out of control under the previous two administrations, has now been cut by 60 pct. We are on our way to a balanced budget," Gore said. The U.S. budget deficit is forecast by both the White House and Congressional Budget Office to fall to only about $116 billion in fiscal 1996, down from about $144 billion forecast in May and half the deficit level of four years ago. The U.S. economy grew at a rate of 4.2 percent in the second quarter although most economists expect that to slow later in the year. Inflation is moderate at less than four percent. Clinton has promised to balance the federal budget by 2002 but has been unable to reach agreement with the Republican majority in Congress on how to do it. 2993 !CCAT !GCAT !GDIS !GVIO Traces of the flammable liquid nitroglycerin have been found in the wreckage of TWA Flight 800 bolstering the theory that an explosive device destroyed the plane, the New York Daily News said in its Sunday edition. The report by the Daily News comes just two days after the New York Times said traces of PETN, a chemical compound commonly found in both plastic explosives and surface-to-air missiles, was found on a piece of seat from the Boeing 747's passenger cabin. "We found nitro too," an unnamed senior federal official told the tabloid Daily News. "And the amazing thing about that is that nitroglycerin is water soluble. So to get a positive test result from a piece of wreckage that was under water is kind of amazing. We aren't sure what to think," the source said. The TWA jumbo jet, bound for Paris crashed off the New York coast shortly after taking off from Kennedy Airport on July 17, killing all 230 people on board. The nitroglycerin and traces of the plastic explosive PETN were found in the general area of the right wing and near the flooring over the fuel tank, the official told the tabloid. The official was quoted as saying someone could have carried PETN onto the plane. He also said "there could have been so much nitro on the plane that the water couldn't wash it away." A spokesman for the Federal Bureau of Investigation would not confirm or deny the nitroglycerin report. "The policy of the bureau is not to comment on evidence and it is not our practice to respond to news reports," he said. A spokeswoman for the National Transportation Safety Board also refused comment. "I can't confirm it," she said. The federal official told the tabloid that the nitro finding was "bizarre". While nitroglycerin can be used in the making of a bomb, it is also a drug that dilates blood vessels and is used extensively by millions of heart patients to prevent and treat angina. 2994 !GCAT !GPOL !GVOTE President Bill Clinton charged on Sunday that there is an organised unprecedented Republican campaign against his wife Hillary, but said she has held up well under attacks. In an interview in the Chicago Tribune, Clinton said he was not surprised by Republicans' indirect criticism at their convention. "Well, it didn't surprise me; they've been doing it for five years now," Clinton said. "It has been part of their political strategy for five years." "There is no precedent for it," Clinton said, adding, "She is pretty strong and she has held up right well, I think." Even Eleanor Roosevelt could not have been more personally attacked, said Clinton, saying the former first lady "didn't have the kind of organised, disciplined, long-term movement that she has (had)." Clinton also struck back at Republican presidential nominee Bob Dole who took a verbal swing in his acceptance speech at Mrs. Clinton over her book about children, "It Takes a Village" when Dole said it doesn't take a village but that it takes a family to raise children. The attacks on his wife were "incongruous with the facts," said Clinton. "Look at Sen. Dole, for example," he added, saying he had respect for Dole's Second World War service and fighting back from serious wounds but that "a village" helped him recover. "How many times has he told the story about the people caring for him in the hospital and how this country invested in his healthg care?" Clinton asked. How many times has he talked about how he went back home to Russell, Kansas, and everybody worked to make him whole again?" Clinton said about Dole, "I certainly think that the village helped him." 2995 !GCAT !GPOL !GVOTE The Democrats are coming together this week to formally back President Bill Clinton for a second term, but the united front masks deep differences over the future course of the party and the country. On one side are self-styled New Democrats, including lately Clinton himself, who favor smaller government, open trade and market-oriented solutions to America's ills. On the other are more traditional liberals, who back an increased role for the government and question the efficacy of free trade and unfettered markets. "The liberals in the party have by and large resigned themselves and are committed to electing Clinton," said Jeff Faux, president of the Economic Policy Institute, a liberal think tank. "But the debate is far from over." The coming ideological battle is of more than academic interest because it could shape the parameters of the second term of a president who even some supporters acknowledge seemed to govern as a liberal in his first two years in office and a New Democrat thereafter. "It hasn't always been a stright line," said Al From, president of the moderate Democratic Leadership Council (DLC). Recent opinion polls have put Clinton ahead of Republican challenger Bob Dole in the race for the presidency, although the gap has narrowed in the past two weeks. An inkling of what might be in store after the Nov. 5 election came last week when many of the party's members attacked Clinton for signing the welfare reform bill. The bill, which Clinton himself has said is flawed, fulfills the president's 1992 election-year pledge to "end welfare as we know it" by limiting eligibility for government help and ending direct federal aid for poor children. Patricia Ireland, president of the National Oragnization for Women, denounced Clinton and accused him of caving into religious and political extremists. "While some of us may hold our noses and vote for President Clinton, many of us will refuse to lift a finger or contribute a penny toward his re-election," she said. "We know he is at best our option this year, not our answer." The coming power struggle in the party rests on differing interpretations of the political revival of Clinton and the Democrats since the 1994 congressional election debacle, when they lost control of the House of Representatives for the first time in 40 years. New-style Democrats -- and Clinton's political guru Dick Morris -- have ascribed his revival to his decision to tack to the right, staking out a position between liberals in his own party and hard-line Republican conservatives in Congress. But liberals argue that it has been Clinton's staunch defense of traditional big government programs such as Medicare against Republican attacks that have led to his comeback in the polls. The divided loyalties within the Democratic Party have not been lost on Dole, who has tried to capitalize on them in his uphill campaign to oust the president from the White House. "Just imagine what he'll do if he were somehow to win a second term -- his liberalism unrestrained by the need to face the American people in another election," Dole said. The DLC's From argued that the steps that Clinton has taken away from old-style liberalism -- backing the North American Free Trade Agreement, a balanced budget and welfare reform -- are irrevocable and that it will not matter much if Democrats or Republicans win control of Congress in November. Democrats were in charge of Congress during Clinton's first two years in office, when he tried unsuccessfully to push through health care reform that Republicans branded a bureaucratic nightmare and a return of big government. "Whether Democrats regain control of Congress or the Republicans do ... probably isn't going to make a big difference because the balance of power is going to be very small," From said. He wants Clinton to use a second term to complete welfare reform by helping states cope with their increased roles under the new legislation. Also on From's wish list for a second term: modernization of the education system, measures to help the cities and reform of entitlement programs such as Medicare health benefits for the elderly. Not surprisingly, Democratic liberals see things differently and predict a struggle for power after Nov. 5. "There could be a ferocious fight," said Robert Borosage, co-director of Campaign for America's Future, a group formed this year by labor unions and others concerned about the party's drift to the right. Borosage has a different agenda than From: an end to the tight money policies of the Federal Reserve, laws and tax incentives to make corporations more accountable to their workers and stepped-up public investment. "There's a long-term struggle that we're involved in to help determine the direction of the Democratic Party and the country as a whole," said Steve Rosenthal, political director of the 13.1 million-member AFL-CIO labor group. 2996 !GCAT !GDEF !GDIP U.S. intelligence officials have concluded that Pakistan was secretly building a medium-range missile factory using blueprints and equipment supplied by China, the Washington Post reported on Sunday. Quoting unidentified U.S. officials, the newspaper said the development raised the prospect of a major new U.S. proliferation dispute with Beijing. A White House spokesman said he could not confirm the story but said the United States took such reports seriously. "We do not believe it is in the best interests of the United States or of any other country to supply Pakistan with the capacity to manufacture or deploy weapons of mass destruction," the spokesman said. The partially completed factory in a suburb of the northern city of Rawalpindi, near the capitol Islamabad, was expected to be capable of producing most of the major components of a missile modelled on the Chinese-designed M-11 in a year or two, according to the newspaper report. Some U.S. officials believed the factory would produce precise duplicates of the missile, the Post added. The United States has twice imposed limited economic sanctions against China for selling M-11 missile launchers and finished missile components to Pakistan, but withdrew them after China promised to stop such deliveries. Washington recently settled a dispute with China over a sale to Pakistan of nuclear-related equipment and the Post quoted officials as saying the construction of the missile factory raised the possibility that broad economic sanctions eventually could be imposed on both countries. However, the White House spokesman suggested sanctions were not in the offing. "We have not come to any conclusions that would warrant sanctions at this time with respect to Pakistan or China," he said. The existence of the Pakistani factory had been known to U.S. intelligence officials since last year when construction evidently began, the newspaper said. The White House has recently sought improved relations with China after months of disputes over Taiwan, trade and human rights. In one sign of the warming relations, U.S. National Security Adviser Tony Lake visited Beijing last month. One adminstration official, speaking on condition that he not be identified, suggested it would be a mistake to assume the United States would ignore nuclear proliferation in South Asia in the interests of a better relationship with China. "Those that seek to point out our alleged oversensitivity to our relationship with China do not understand how serious we are about these proliferation issues," said the official. "But we also will not come to a conclusion prematurely," he added. "We need to have the evidence, which is why we are monitoring the situation carefully." 2997 !GCAT !GPOL !GVOTE By Alan Elsner, U.S. Political Correspondent On the eve of the Democratic convention that will nominate him for a second term in the White House, President Bill Clinton remains in the driver's seat in the contest against Republican nominee Bob Dole. The campaign so far has gone almost exactly as envisaged by White House political strategists, who wanted to enter the convention holding a solid lead against Dole and end it with a healthy bounce for Clinton. White House political director Doug Sosnik laid out the scenario in an interview with Reuters in the spring. Clinton, he said, would use the months of May, June and July to build up as large a lead as possible over Dole. He would also attempt to define the main issues around which the campaign would be fought. Sosnik predicted that Dole would make a comeback in August as he chose a running mate and went through the Republican convention. But Clinton would stretch the lead again with the Democratic convention. Polls suggest Clinton is now leading by between five and 12 percentage points. More importantly, he appears to have control of most, though not all, of the dominant issues in the campaign. And the economy continues to be healthy, especially in the key Midwestern states and California. "With the economy doing as well as it is, most political models suggest this race may be close but Clinton will win," said John Geer, a political scientist at Vanderbilt University in Nashville, Tennessee. If Clinton receives even a five point boost in his ratings from his convention this week -- and he could well get more -- he will enter the fall campaign with a 10-17 point advantage. That would be a lot of ground for Dole to make up in the light of past history which shows that the candidate leading the race in early September generally wins. Al Tuchfarber, a pollster and political scientist at the University of Cincinnati, said Dole needed to be within 8 to 12 points of Clinton in early September to have a chance. Even so, he would have to run the campaign of his life against a president who is generally seen as a superior communicator and debater. A Reuters-Zogby poll last week revealed that Clinton had essentially held on to his base support through the Republican convention, when Dole's message dominated the air waves. Conversely, Dole has still not managed to fully win back the support of an important element of his natural constituency. For example, only 65 percent of those who said they had voted for former Republican president George Bush in 1992 intend to back Dole this time. Only nine percent of those who voted for Texas billionaire Ross Perot four years ago currently support Dole. Three quarters of Clinton's 1992 voters and 21 percent of Perot voters intend to vote for the president. Clinton has the support of 77 percent of Democrats, 10 percent of Republicans and 36 percent of independents. Dole has the backing of 72 percent of Republicans, eight percent of Democrats and only 28 percent of independents. One major problem for Dole, which refuses to go away, is his age of 73. Almost a quarter of voters who describe themselves as either very conservative or conservative said they strongly agreed with the proposition that Dole was too old to be president. A further 21 percent said they somewhat agreed. There are few things more tiring than the last eight weeks of a U.S. presidential campaign, which can make even young men look old. Dole is in superb physical shape for his age, but the big test still lies ahead. The Reuters poll surveyed respondents on their views about 10 issues, asking them to rank them as: most important, very important, somewhat important or not important. The most surprising fact to emerge was that taxes, which Dole has made the centrepiece of his campaign, came out in eighth place in terms of importance. That is bad news for Dole who is counting on the tax issue to dominate the election. But voters rated education most important, followed by jobs and the economy. Even the environment, widely seen as a Clinton strength and a Dole weakness, ranked more important than taxes in voters minds, according to this poll. 2998 !GCAT !GDIS A gas pipeline explosion killed two teenagers and forced 50 families to evacuate their homes in a small Texas town Saturday, police said. The two 17-year-old victims, a boy and a girl, smelled liquid butane gas leaking from a pipeline in the town of Lively and jumped into their truck to warn people but their vehicle exploded in flames, apparently because of an ignition spark. Police said the pipeline was shut off but gas was still burning and would continue to do so for several hours. One home was destroyed and 50 others were evacuated. The residents were put up in shelters in and around Lively, which lies about 40 miles (60 km) southeast of Dallas. 2999 !GCAT !GPOL !GVOTE Republican vice presidential candidate Jack Kemp set out on his own Saturday for the first time since his nomination this month, preaching a message of tax cuts and racial harmony. Kemp, the main draw at an annual political picnic on bucolic Vashon Island near Seattle, called for an end to racial strife and declared that he and running mate Bob Dole intended to run what he called an "inclusive campaign." "This country needs healing," he told thousands of party faithful. "It needs reconciliation within races of people and ethnic groups of people. We need a message that can bring Americans together." A former professional football player known for his garrulous personality, Kemp has a reputation for outspokenness and some Republicans feared he might have trouble playing second fiddle to Dole. Since the party convention ended in San Diego a week ago, the two men had campaigned together with Kemp deferring at every stop to the No 1 man on the Republican ticket. On Saturday, however, Kemp was the headliner among dozens of Republican candidates, including eight running for governor in a September primary, who were introduced to the nearly all-white crowd at the picnic. The free carnival-like event was held on a 167-acre farm owned by businessman Thomas Stewart, who is under criminal investigation after admitting he secretly funnelled $60,000 into a losing campaign for a Seattle city ballot measure. Kemp appeared on stage with his wife, Joanne, and his son Jeff and three grandchildren, who live in a Seattle suburb. Speaking under a red-white-and-blue banner that called for Republicans to unite, Kemp addressed the campaign's economic theme, saying Dole's proposed 15 percent tax cut was essential to "the future of our families." "We're going to take the U.S. tax code, and we're going to repeal the whole monstrosity," he said. Republican Party officials estimated 12,000 people attended the picnic, although that was the total number of people transported to the island by the Washington State Ferry system, officials said. The island, which can only be reached by boat and has a population of about 10,000, is a popular day trip for Puget Sound area residents. 3000 !GCAT !GCRIM Investigators arrested a senior police detective on Sunday in connection with their inquiries into Belgium's paedophile kidnap, killing and porn scandal, Public Prosecutor Michel Bourlet said. "Georges Zicot was arrested and will be charged with truck theft, insurance fraud and document forgery," Bourlet told a news conference. He said Zicot's connection was through a murdered accomplice of convicted child rapist Marc Dutroux -- the central figure in the scandal that has sent shockwaves across Europe and triggered a hunt for an international child porn ring. The prosecutor said there had been searches at three sites on Sunday, including one at the judicial police headquarters in the southern city of Charleroi where Zicot worked. Zicot, 45, is a specialist in tackling vehicle theft. Belgian media reported that he had been questioned twice in the past two years about thefts but released both times. He was promoted to chief detective earlier this year. Bourlet said two other people were also arrested. One was Gerard Pignon, the owner of a warehouse where stolen vehicles were allegedly stored. The other was insurer Thierry Dehaan. Bourlet said the investigation into the vehicle theft ring would be added to the inquiry into the paedophile sex scandal in which five other people have already been arrested. He said the connection was through Bernard Weinstein, an accomplice of Dutroux. Weinstein was found dead last weekend alongside the bodies of eight-year-olds Julie Lejeune and Melissa Russo in a house near Charleroi belonging to Detroux, who said they starved to death, nine months after being abducted in June 1995. Two other girls -- Laetitia Delhez and Sabine Dardenne -- were rescued from a dungeon in another of Dutroux' six houses 10 days ago, and police are hunting for at least two more -- An Marchal and Eefje Lambrecks -- who Dutroux has admitted kidnapping a year ago. "Dutroux has admitted killing Weinstein after a disagreement between the accomplices in an affair of truck theft," Bourlet told reporters. Another four people were also questioned at the weekend but had not been detained, he added. Anne Thily, public prosecutor in the eastern city of Liege where Julie and Melissa lived, told the news conference this was a major case involving some 50 investigators -- including two from the United States' Federal Bureau of Investigation. Earlier on Sunday police with mechanical diggers and dogs trained to find bodies moved into a scrapyard owned by a German connected with Dutroux but left again some hours later apparently empty-handed. Dutroux and associate Michel Lelievre have been charged with abduction and illegal imprisonment. Dutroux' second wife Michelle Martin has been charged as an accomplice. Three other people face charges of criminal association. Recriminations have steadily built up over how Dutroux managed to prey on children unhindered for so long -- with allegations of protection in high places. Sunday's arrest will fuel that speculation. Police documents leaked to the Belgian media catalogue a high degree of police bungling, incompetence and indifference. Bourlet has said Dutroux featured on some of the more than 300 paedophile porn video tapes that have been seized. Police are also trying to trace the origin of soporific drugs seized from Dutroux' houses. Prosecutor Thily said the fate of An and Eefje remained a mystery. But there has been speculation they were sold into prostitution in Slovakia or the Czech Republic where Dutroux was a frequent visitor. Belgian police have visited Bratislava and will visit Prague. 3001 !GCAT !GCRIM Investigators arrested a senior police detective on Sunday in connection with their inquiries into Belgium's child sex scandal, Public Prosecutor Michel Bourlet said. "Georges Zicot was arrested and will be charged with truck theft, insurance fraud and document forgery," Bourlet told a news conference. He said there had been searches at three sites on Sunday, including one at the Charleroi judicial police headquarters where Zicot worked. Zicot, 45, is a specialist in tackling vehicle theft. Belgian media reported that he had been questioned twice in the past two years about thefts but released both times. He was promoted to chief detective earlier this year. Bourlet said two other people had also been arrested. One was Gerard Pignon, the owner of a warehouse where stolen vehicles were allegedly stored. The other was insurer Thierry Dehaan. Bourlet said the investigation into the vehicle theft ring would be added to the inquiry into the paedophile sex scandal in which five other people have already been arrested. He said the connection was through Bernard Weinstein, an accomplice of convicted child rapist Marc Dutroux -- the central figure in the paedophile scandal that has sent shockwaves across Europe. Weinstein was found dead last weekend alongside the bodies of eight-year-olds Julie Lejeune and Melissa Russo in a house belonging to Detroux, who said they starved to death earlier this year, nine months after being abducted in June 1995. Two other girls have been rescued and police are hunting for at least two more who Dutroux has admitted kidnapping a year ago. "Dutroux has admitted killing Weinstein after a disagreement between the accomplices in an affair of truck theft," Bourlet said. Another four people were also questioned at the weekend but had not been detained, Bourlet added. Anne Thily, public prosecutor in the eastern city of Liege where Julie and Melissa lived, said this was a major case involving some 50 investigators -- including two from the U.S. Federal Bureau of Investigation. 3002 !GCAT !GPOL President Jacques Chirac pledged on Sunday to stick to France's strict immigration laws despite a furore over a police roundup of Africans in a Paris church. A group of 10 hunger strikers among the Africans seized in Friday's swoop on the Saint-Bernard church decided to call off a 52-day fast after they were released from detention with about 40 other people on Sunday, a spokeswoman said. Only a handful of the 210 Africans originally arrested in the church, where they were protesting against expulsion orders, are still in formal custody after a string of releases by police and court rulings in the Africans' favour. Most, however, still face expulsion orders being contested in courts by their lawyers. France deported four of the Africans, most of whom are from Mali, Senegal and Zaire, by plane on Saturday. Chirac, ending his silence since the raid that brought condemnation from left-wing opposition parties and human rights groups, said he wanted to send a "strong signal" to discourage potential immigrants from poor countries. But the conservative president also said France should review details of the implementation of controversial 1993 immigration laws, which outlawed some immigrants previously living legally in France, and promote aid to poor nations. "There's no question of the government changing policy but the government will have the heart to see how the practice of the laws must be adapted," he said after a weekend meeting with Prime Minister Alain Juppe in a Riviera fortress. He said French people, regardless of their politics, felt "a growing irritation over immigration". The hunger strikers were freed after police made an about-turn and decided not to seek to extend their custody. But police said only one of them would qualify for a residence permit and the rest would be expelled. "We're going to start feeding them again. They've stopped their hunger strike, that makes 52 days today," the Africans' spokeswoman Madjiguene Cisse said. "They are rejoining the group and will see how to pursue the struggle." Tired and drained by the fast, the hunger strikers smiled and were able to walk unaided as they left a detention centre in Vincennes on the eastern edge of Paris. The hunger strikers say they had been drinking only sugared tea and taking vitamins. Actress Emmanuelle Beart, star of the U.S. blockbuster "Mission Impossible" who has long supported the Africans, turned up at a celebration of the Africans' release in Vincennes. "They've given me a lesson of courage, of dignity," she said. About 200 protesters scuffled with police in Paris on the fringes of celebrations of the 52nd anniversary of the liberation of Paris from the Nazis on Sunday but there were no reports of injuries. LCI television said 61 were detained. Earlier on Sunday, another 40 Africans were freed after their lawyers embarrassed the centre-right government with a string of court victories over detention orders. A judge ruled that unauthorised officials had signed custody documents. The court that earlier freed the 40 other detainees agreed to extend the detention of 13 other Africans. A separate court sentenced three Africans to jail for up to three months, with another four people getting suspended prison terms. The government has said that about 30 or 40 percent of all the Africans originally arrested can expect residence permits and the rest would be expelled. The Interior Ministry has said that more than 40 will get residence permits this week. 3003 !GCAT !GOBIT !GPRO Veteran diplomat Erskine Childers, whose father was the fourth president of the Irish Republic, died on Sunday of a heart attack, associates said. Childers, Secretary-General of the World Federation of United Nations Associations (WFUNA), died during the federation's 50th anniversary congress in Luxembourg. "He was sitting in Congress after giving a speech when he suddenly had breathing difficulties and keeled over," Federation chairman Malcolm Harper said by telephone. "His sudden death is a bitter tragedy for WFUNA," a statement issued in Brussels said. Childers, 68, became Secretary General of WFUNA only five months ago after a career that began in academia and ended in 1989 after 22 years working at all levels in the United Nations. Between leaving the U.N. and taking up his post at the WFUNA, Childers toured extensively lecturing and writing on U.N. matters. A special session of the Congress was held to pay tribute to him, the Federation statement said. Childers came from a distinguised Irish family. His father, also Erskine Childers, who died on November 17, 1974 was only the second protestant to be president of the Irish Republic. Before him, his father -- also called Erskine Childers -- wrote the best-seller mystery book "The Riddle of the Sands" and was a distinguished naval flying officer in World War One before being executed by the British in 1922 for supporting the nationalist cause. 3004 !CCAT !GCAT !GDIS A stricken Japanese fishing vessel has restarted its motors after drifting for three days because of a gas leak in the engine room which killed five of its crew. Irish Defence officials said the Taisei Maru was under its own power on Sunday and was expected in the southern regional capital of Cork by Monday afternoon. The vessel's agents are in Cork. They are expected to send home the bodies of the five dead. Another crewman is suffering from gas inhalation. The vessel, with 16 crew, was among more than 30 Japanese trawlers fishing for tuna off Ireland's West coast last week. Two of the vessels were detained for fishing inside the Irish Box, the 200-mile international waters Ireland is policing for its own fishermen and licenced foreign fleets. The Taisei Maru has been without power since a leak of freon gas from its refrigerating unit killed five crew in the engine room and injured one other person. Crew from the Irish naval vessel the LE Aisling boarded the vessel on Saturday together with three Japanese engineers and managed to disperse the gas from the engine room and restart its motors. They established that the gas had not put the engines out of action and power was restored early on Sunday, defence officials said. Two Japanese captains have appeared in court in southern Ireland charged with illegal fishing and unauthorised entry into the Irish Box. Both were freed on bail and ordered to return or trial in November. The Japanese fleet has been using long baited lines to catch tuna in Irish water. The tackle is thrown overboard and allowed to drift until it is picked up later. 3005 !GCAT !GPOL !GVIO A bomb planted by suspected Corsican separatists damaged a town hall in the east of the Mediterranean island on Sunday, police said. The blast, the 13th since violence flared up 10 days ago, damaged offices in the Prunelli di Fiumorbu town hall shortly after midnight. No one was hurt. The bomb damaged the entrance hall, a telephone switchboard and another office. No one claimed responsibility for the attack, which bore the hallmarks of Corsican separatists battling for greater autonomy from Paris. 3006 !GCAT !GCRIM A child sex scandal which has shocked Belgium to the core took a new twist when investigators arrested a senior police detective in connection with the case. The arrest added weight to widespread speculation that a paedophile gang, suspected of being led by convicted rapist Marc Dutroux, must have received high-placed protection. The scandal, involving kidnapping, killing and paedophile pornography, had already sent waves of revulsion across Europe, triggered an international manhunt and prompted widespread recriminations. Two kidnapped eight-year-old girls have been found dead, two other girls have been rescued and police are hunting at least two more girls who have been missing for a year. Police have seized more than 300 paedophile video tapes -- some featuring Dutroux -- quantities of magazines, childrens' clothing and drugs used to pacify the young victims. Dutroux, convicted in 1989 for multiple child rape, and associate Michel Lelievre have been charged with abduction and illegal imprisonment. Michelle Martin, Dutroux' second wife, has been charged as an accomplice and three men are facing charges of criminal association. But the arrest on Sunday of Chief Detective Georges Zicot, a specialist in tackling vehicle theft in the southern city of Charleroi, added a new dimension to the scandal. "Georges Zicot was arrested and will be charged with truck theft, insurance fraud and document forgery," Public Prosecutor Michel Bourlet told a news conference. He said two other people were also arrested -- Gerard Pignon, owner of a warehouse where he alleged stolen vehicles were stored, and insurer Thierry Dehaan. Bourlet said Zicot's connection was through Bernard Weinstein, an accomplice of Dutroux. "Dutroux has admitted killing Weinstein after a disagreement between the accomplices in an affair of truck theft," he said. Weinstein was found dead last weekend with the bodies of eight-year-olds Julie Lejeune and Melissa Russo in a house near Charleroi belonging to Detroux, who said they starved to death nine months after being abducted in June 1995. Two girls, Laetitia Delhez and Sabine Dardenne, were rescued from a dungeon in another of Dutroux' six houses 10 days ago and police are hunting for at least two more, An Marchal and Eefje Lambrecks, whom Dutroux has admitted kidnapping a year ago. Bourlet said the investigation into the vehicle theft ring would be added to the inquiry into the paedophile sex scandal. Anne Thily, public prosecutor in the eastern city of Liege where Julie and Melissa lived, told the news conference this was a major case involving some 50 investigators, including two from the U.S. Federal Bureau of Investigation. Police in South Africa are cooperating with the FBI in investigations into a suspected child pornography trade spanning the United States, South Africa and Europe. Recriminations have steadily built up over how Dutroux managed to remain at liberty for so long -- with allegations of protection in high places. Leaked police documents catalogue a high degree of police bungling, incompetence and indifference. There is also widespread disbelief that no one appeared to question how Dutroux, an unemployed father of three with no visible means of support, managed to own so many houses. Justice Minister Stefaan De Clerck has admitted that mistakes were made and ordered an inquiry. Thily said the fate of An and Eefje remained a mystery. The media has speculated that they were sold into prostitution in Slovakia or the Czech Republic where Dutroux was a frequent visitor. Belgian police have been to Bratislava and will visit Prague. 3007 !GCAT !GPOL Angola's former rebel movement UNITA will accept the offer of a vice-presidency in a new unity government but will not appoint its leader Jonas Savimbi to the post, the Portuguese news agency Lusa reported on Sunday. "UNITA will accept an Angolan vice-presidency but will not designate its president Jonas Savimbi to take this position," Lusa quoted the movement's spokesman Marcial Dachala as saying. UNITA has been holding a congress in its northern stronghold of Bailundo since Tuesday to decide whether Savimbi should join the ruling MPLA to form a unity government of old foes and help cement a fragile two-year-old peace. On offer is one of two vice-presidencies which Savimbi, 63, has said his UNITA colleagues must accept or decline for him. Last Wednesday, the congress loudly rejected the vice-presidency, shouting "negative, negative" when the topic was raised. There was no official vote and Savimbi later warned delegates against making "extreme decisions." He also told the congress that war was no longer an option and that they would have to prepare for opposition politics. Some party officials have suggested UNITA's chief constitutional negotiator Abel Chivukuvuku could become vice-president instead. Political analysts and diplomats said that the 20-month peace could survive even if Savimbi declined the government job. Lusa said Savimbi would hold a news conference on Tuesday to present the congress's conclusions. UNITA and the once Marxist MPLA government, who fought for two decades after the colonial power Portugal pulled out, signed a peace pact in 1994. Since then Angola has remained largely divided into MPLA-controlled areas centred on the capital Luanda, and UNITA-held territory which includes northern diamond areas. 3008 !GCAT !GCRIM !GODD Michael Schumacher's victory in the Belgian Formula One Grand Prix at Spa-Francorchamps sparked a speeding epidemic on Belgian roads after the race was over. Belga news agency reported that police checked more than 3,000 drivers and booked 222 for speeding on their way home after the race. Some were clocked doing 180 kilometres an hour (112 miles per hour), Belga said. Schumacher, driving a Ferrari, won the race in 1 hour 28 minutes 15.125 seconds at an average speed of 208.442 km/hour (130 m.p.h.). 3009 !E21 !E211 !ECAT !GCAT !GPOL !GWELF Prime Minister Alain Juppe said on Sunday the draft 1997 budget and plans for funding the social security system would be pubished around September 10. "The texts are practically ready," he told reporters after a weekend of talks with President Jacques Chirac in a Riviera fortress. The budget had been widely expected a week or so later. -- Paris newsroom +331 4221 5452 3010 !C12 !CCAT !GCAT !GCRIM Two Britons working in the North Sea offshore oil industry have been detained on suspicion of corruption involving Norway's state-owned company Statoil, Norwegian police said on Sunday. Police said one suspect was a Statoil construction manager and the other a manager with offshore consultancy firm Idavoll. Neither was named, in keeping with the Norwegian practice of not identifying suspects until convicted. "We can confirm that on Friday morning we arrested two British citizens...on suspicion of irregularities in business dealings involving the state oil company Statoil," a police statement said. Stavanger assistant chief police Tore Soldal told reporters the Idavoll director was due to appear before magistrates in Stavanger on Monday, where he was expected to be remanded in custody while the investigation continued. The manager for Statoil, formally Den norske stats oljeselskap AS, had agreed at the weekend to be remanded in custody for up to 14 days, he said. Asked to confirm Stavanger press reports the Statoil man was suspected of accepting 750,000 Norwegian crowns ($115,000) from Idavoll, Soldal told a news conference: "It is in that region". The national news agency NTB quoted Statoil spokesman John Ove Lindoe as saying Statoil had used Idavoll's services since 1988 and had awarded it contracts worth 79 million Norwegian crowns ($12 million). Norway pumps three million barrels of oil per day and is the world's second largest oil exporter after Saudi Arabia. Norway is also a major player in offshore natural gas production. Soldal, who said the probe had been going on for nearly a year, said in response to questions a bank account into which alleged bribes were paid was in the Channel Island of Guernsey. The police statement said the manager with Idavoll, a firm at Sandnes near Stavanger, Norway's oil and gas capital, was "suspected of corrupt business practices". It said flats and office premises in the Stavanger area had been searched and that British police had cooperated with Stavanger police in the investigation. No details were given. It was the second such case to hit Statoil in the last few years. In 1995 a former Statoil engineer was sentenced to two years in prison by a Norwegian court after being found guilty of accepting bribes from German engineering firm Mannesmann Handel AG. ($1=6.440 Norwegian Crown) 3011 !GCAT !GPOL !GVIO Algerian authorities and opposition groups will hold a national conference, a milestone in President Liamine Zeroual's drive to reshape the country's future, in the "next few days", an official spokesman announced on Sunday. "The unfolding of this conference is expected in the next few days", said Amar Tou, a spokesman of a joint committee set up by the presidency and comprising over 20 opposition parties to prepare details of a "national conference of harmony". Algeria has been seeking a way out of civil strife which has racked the country since the authorities in 1992 cancelled a general election in which the fundamentalist Islamic Salvation Front (FIS) took a commanding lead. An estimated 50,000 people have been killed in the violence. Among the political parties represented in the committee are the former sole ruling party, the National Liberation Front (FLN), two legal Islamist groups, Hamas and Nahda, and the secular anti-Islamist Rally for Democracy and Culture (RCD). The FIS is outlawed and was not involved. "Political parties' representatives and (presidency) officials reached an accord over a proposal making the national conference of harmony the crowning of the dialogue process", said Tou, quoted by Algerian state-run radio and television. Zeroual started a dialogue with opposition parties, after an election last November confirmed him in power, to try to rally support for his plan to hold a referundum to amend the constitution this year and then hold general elections in 1997. The joint committee for the national conference was one of four bodies, grouping Zeroual's aides and party officials, set up in mid-August in the wake of a marathon dialogue. The three other committes have finalised draft new election and party laws and proposed changes to the constitution. The national conference will mainly adopt a kind of code of political conduct, banning the use of violence as a way to seek or hold power, said Tou, who is FLN's official. The secular opposition Socialist Forces Front (FFS) walked out early this month from Zeroual's talks alleging he intended mostly to build an "anti-Islamist front". Presidency officials and political parties, taking part in the talks, on Saturday drew up an election law to introduce proportional representation instead of the two round majority system that brought the FIS close to power. Earlier last week they also drafted a law governing political activities that would eventually ban Islamists parties. 3012 !C12 !C13 !C15 !C151 !C17 !CCAT !GCAT The Bank of Italy has discovered that loss-making southern bank Banco di Napoli significantly under-stated problem loans in its 1994 accounts, Milan financia daily Il Sole 24 Ore reported on Sunday. The report said that central bank director-general Bruno Bianchi had written to the finance committee of the lower house of parliament saying that Banco di Napoli had provided unreliable information. He also defended the Bank of Italy's supervisory role in the affair. Some 3.9 trillion lire of non-performing loans appeared to have been concealed while other problem loans did not show up in the 1994 balance sheet. Central bank inspectors had found 7.6 trillion lire in non-performing loans and 5.9 trillion lire in other problem loans, compared with 3.7 trillion lire and 1.8 trillion lire, respectively, that were declared by Banco di Napoli. The stricken southern bank has been kept afloat by finance extended by a consortium of major Italian banks while a new management team sells off non-core assets. The authorities, which have said they are taking legal action against some of Banco di Napoli's former top managers, want the bank recapitalised in the hope that a suitable buyer can be found. 3013 !GCAT !GCRIM !GPOL !GVIO About 50 Africans seized in a raid on a Paris church, including hunger strikers, were released on Sunday after a string of court victories over detention orders and a police about-turn. The releases meant only a fraction of the 210 people arrested in the Saint-Bernard church on Friday, when the 10 hunger strikers were in the 50th day of a fast against French expulsion orders and strict immigration laws, were still in detention. Despite the releases, many of the Africans still face the threat of expulsion. Most of the Africans are from Mali, Senegal and Zaire. Six hunger strikers, looking drawn and tired but smiling and able to walk unaided, were released from the Vincennes detention centre east of Paris on Sunday after police decided not to seek an extension of their custody in a change of policy. Supporters cheered as they walked free. Another three of the hunger strikers were released from hospital and a 10th had been quietly released on Saturday night, police said. Police said they planned to grant just one of the 10 a residence permit and expel the rest. Earlier, about 40 Africans were freed from the Vincennes detention centre on the eastern edge of Paris after a civil court ruled police had made errors in custody orders, including unauthorised signatures on documents. They embraced friends and relatives as they left, celebrating rulings that were an embarrassment to the centre-right government. The court that freed the 40 agreed to extend detention for only 13 other Africans. A separate court sentenced three people to jail for up to three months, with another four people getting suspended prison terms. Four of the Africans were deported on Saturday night on a plane that flew to Mali, Senegal and Zaire as Prime Minister Alain Juppe sought to balance a crackdown on illegal immigration with a promise of greater humanity. Airport staff in Mali dubbed the French military plane carrying the deportees, who included another 53 facing previous expulsion orders, a "flight of shame" and refused to handle it. Paris police headquarters said it would appeal against the freeing of the 40 on Sunday. Leon Schwartzenberg, a human rights activist and cancer specialist, hailed the decision to release the hunger strikers. "We are very pleased about the situation for the hunger strikers, who are very tired," he said. The Interior Ministry said on Saturday that more than 40 of those seized in the church would be granted residence permits in coming days "due to family or health situations". Defence lawyers said police headquarters had formally decided to scrap 45 expulsion orders on Sunday. The church raid triggered protests against the centre-right government and clashes between stone-throwing protesters and riot police in Paris on Friday night and again around a military airbase when the first Africans were deported. Prime Minister Alain Juppe was meeting President Jacques Chirac in the president's Riviera retreat on Sunday for a weekend of informal talks about government policy, ranging from immigration to unemployment. The 1993 immigration laws, named after former interior minister Charles Pasqua, are a tangle partly because some immigrants, such as parents of children born in France since 1993, can now neither be expelled nor obtain residence permits. 3014 !GCAT !GDIP !GPOL French President Jacques Chirac, breaking his silence about a controversial police roundup of Africans in a Paris church, said on Sunday that France would stick to strict immigration policies. Chirac, speaking after weekend talks with Prime Minister Alain Juppe in a Riviera retreat, said however that the implementation of 1993 immigration laws should be adapted. Chirac told reporters he wanted both "great firmness on immigration and a strong commitment to the development of the poorest countries". Police with batons and tear gas seized 210 Africans in a Paris church on Friday, including 10 who were on the 50th day of a hunger strike against expulsion orders. Four of the Africans were expelled on a plane to Mali, Senegal and Zaire on Saturday night. Almost all the others, including the hunger strikers, have been freed from custody but are still under threat of expulsion from France. 3015 !GCAT !GCRIM Police with mechanical diggers began excavating in another part of the southern city of Charleroi on Sunday in a search for clues to two missing, kidnapped girls, Belgian radio reported. It said 40 officers, with excavation equipment and dogs trained to find bodies, moved into the property of a German demolition expert known for close contacts with the chief suspect in a child sex-abuse scandal, Marc Dutroux, who has admitted kidnapping An Marchal and Eefje Lambrecks a year ago. The radio also said a police inspector had been arrested in connection with investigations into the scandal involving death, kidnapping and pornography. But there was no official confirmation and public prosecutor Michel Bourlet would only confirm that more people had been questioned. Besides the two missing girls, two have so far been found dead and two have been rescued from a secret dungeon. The radio said searchers at the demolition yard in the suburb of Courcelles were likely to work through the night and appeared hopeful of finding fresh clues to the whereabouts of An and Eefje. Dutroux and associate Michel Lelievre have been charged with abduction and illegal imprisonment. Dutroux' second wife Michelle Martin has been charged as an accomplice. Three other people face charges of criminal association. 3016 !GCAT !GPOL Prime Minister Romano Prodi marked his 100th day in office at the weekend amid signs it could face a difficult autumn of economic and political challenges. One hundred days is about a third of the average life span of Italian governments in past decades. They have lasted anywhere from nine days to three years. Prodi is determined to make his government, the first to include former communists since the end of World War Two, endure the full five years of the legislature elected at last April's national poll. "Certainly. I have never put this in doubt," Prodi told a private television interviewer who asked him if he hoped to stay for the duration. "I have always worked for this. The work I do here wouldn't make any sense if it were for the short term. I don't know when all this will bear fruit but I am convinced that I will be around to pick that fruit," he said. Prodi's problems may begin with a challenge to the very fabric of the country expected on September 15 when Umberto Bossi, the seperatist Northern League leader is due to make a symbolic "declaration of independence" for northern Italy. Prodi, who is from the north and has called himself more of a northerner than Bossi, has suggested the day will be a flop for the League and has warned Bossi the government will not tolerate anything illegal. Prodi's government, formed on May 17, has seen some economic success. Inflation has fallen, leading the central bank to cut the discount rate, a move industrialists had been clamouring for. Another success for the centre-left coalition was a deal with the opposition for a parliamentry commission to pave the way for much-needed constitutional reform. But unemployment has been a nagging problem and on Sunday deputy prime minister Walter Veltroni suggested that a recession in Europe would mean countries should consider the possibility of re-thinking the criteria for European Monetary Union (EMU). The government's brief vacation ends on Wednesday when the cabinet meets and is expected to start work on the budget, expected to cut 32.4 trillion lire ($21.34 billion) off next year's deficit. Commentators believe the resumption of political activity in the autumn could present snares for the government, particularly because of its reliance in the lower house on the hard-left Communist Refoundation party. Just before the government went on holiday, Communist Refoundation threatened to bring down the coalition if it pressed ahead with plans to privatise telecoms holding company Stet, which Refoundation strongly opposes. Refoundation lies outside the ruling centre-left Olive Tree government but has always voted with Prodi and ensured he won confidence debates. Refoundation leader Fausto Bertinotti has said the government would be taking a great risk if it looked to the centre-right opposition for parliamentary comfort on Stet. Besides Stet, Bertinotti said his party would also bring its influence to bear on the 1997 budget, saying he wanted to see a new tax introduced on personal wealth. The government has already said there will be no new taxes and has promised to put the emphasis on state spending cuts. Union leaders have threatened the government with mass strikes if their pay claims are not met in the coming round of large-scale wage negotiations. They are demanding compensation for higher-than-expected inflation over the past two years. ($1=1518 Lire) 3017 !GCAT !GPOL !GVOTE Greek socialist Prime Minister Costas Simitis is seen as favourite to win next month's snap poll against a disoriented conservative opposition which offers voters few policy alternatives, analysts said on Sunday. Simitis, 60, called the September 22 election last week while enjoying an approval rating of 70 percent, well ahead of his main opponent, New Democracy party leader Miltiadis Evert, who seems disputed even within the conservative camp. "Costas Simitis' PASOK party has all the prerequisites for a comfortable victory as his top rival (Evert) has not managed to convince even the most committed New Democracy voters," the independent Athens daily Eleftherotypia said in an editorial. Simitis has shown that his mild manner masks a strong political will since succeeding his political mentor and PASOK party founder, the late Andreas Papandreou, in January. He won the premiership in a close parliamentary vote and then went on to become PASOK's president at a party congress in June, dispelling fears that PASOK would split up after Papandreou's departure. Simitis tells Greeks their future lies firmly inside the European Union and that they must make sacrifices to catch up with the rest of the group. The snap vote comes two months before the presentation of next year's budget. Simitis wants to cut spending by $1.2 billion to trim the public debt and persistently high inflation. Finance Minister Alexandros Papadopoulos has sent out special commando groups to arrest tax evaders, who officials say account for 30 percent of the country's total workforce. He also wants curbs on state hirings and below-inflation pay rises. "Many things will change next year that will make many people angry," a senior PASOK official told Reuters. "We must admit that if the election was held as scheduled in October 1997 it would have been more difficult for us." Simitis has cleverly adopted most of the pro-EU policies of New Democracy, which led the country into the 15-member EU, leaving Evert with little new to tell the voters. "Evert agrees on the need for unpopular measures for the economy and generally adopts the government's foreign policy. He tells the voters I'll do it better but Simitis is more popular," a poll analyst said. Evert took over New Democracy's helm from former prime minister Constantine Mitsotakis who lost elections to Papandreou in 1993. The two men dislike each other and polls this summer showed the veteran Mitsotakis making a comeback and even being more popular than Evert among New Democracy voters. "Today New Democracy looks divided as the differences between Mr Evert and Mr Mitsotakis are deeper than the average Greek knows." Eleftherotypia said. Mitsotakis pledged on Saturday that he would fight for a New Democracy win and conservative newspapers had pictures of him shaking hands with Evert at a party meeting. But Mitsotakis' associates said the veteran leader has made clear that Evert will bear the full responsibility in the case of an election loss. Poll companies were caught off guard by Simitis' snap election decision and the first countrywide opinion surveys are expected around September 10. 3018 !GCAT !GCRIM Police searchers returned on Sunday for a third time to a house at the centre of Belgium's child sex-abuse scandal that has horrified Europe. In just over a week two young girls have been found dead, from starvation, two have been freed from a dungeon-like secret compartment and an international hunt has started for at least two others. Police sought clues on the two girls missing in a grim saga of death, kidnapping and pornography that has raised fears of a group of paedophiles operating in European cities. Police searched at the house in Sars-La-Bouissiere owned by chief suspect Marc Dutroux for the third time since the bodies of eight-year-old paedophile victims Julie Lejeune and Melissa Russo were found there a week ago. Julie's father, Jean-Denis Lejeune, went with them to see for himself where his daughter and her friend had died of starvation nine months after being abducted in June 1995. Recriminations have steadily built up over how convicted child rapist Dutroux managed to prey on children unhindered for so long -- with allegations of protection in high places. Dutroux and associate Michel Lelievre have been changed with abduction and illegal imprisonment. Dutroux' second wife Michelle Martin has been charged as an accomplice. Three other people face charges of criminal association. Dutch police are also holding a 74-year old Dutchman in connection with the disappearance of An and Eefje, although a spokesman said no direct link had yet been established. Dutroux was questioned through the night on Saturday, and Belgian RTL television said a police inspector had also been questioned. There was no immediate confirmation. Public prosecutor Michel Bourlet, who has said Dutroux featured on some of the more than 300 paedophile porn video tapes that have been seized, is due to hold a news conference later on Sunday (Eds 1900 GMT). Dutroux was charged a week ago after police rescued two young girls from a concrete dungeon in the basement of one of the six houses he owns in and around Charleroi. A day later Dutroux led police to the bodies of the two eight-year-old girls. He also admitted kidnapping two other girls, An Marchal and Eefje Lambrecks, a year ago. The fate of the girls is unknown, but there has been speculation they were sold into prostitution in Slovakia or the Czech Republic where Dutroux was a frequent visitor. Belgian police have visited Bratislava and will visit Prague. At least part of the speculation in the Belgian media of high-level protection for Dutroux and his accomplices is based on leaked documents cataloguing a high degree of police bungling, incompetence and indifference. Among the revelations are the that the gendarmerie was running a surveillance operation codenamed "Othello" against Dutroux in 1995 -- when both Julie and Melissa and An and Eefje were kidnapped. They show that the gendarmes were aware that Dutroux was building cells in some of his houses for holding children, yet this information was either not passed on to other police forces searching for the missing girls or was overlooked when it was. They also show that police investigating a theft visited Dutroux late last year at the house where Julie and Melissa were being held but accepted his word that the children's cries they could hear came from neighbours. Justice Minister Stefaan De Clerck has admitted that mistakes were made and ordered an inquiry at the same time as stressing there were no indications of a cover-up. There is also widespread disbelief that no one appeared to question how Dutroux, an unemployed father of three with no visible means of support, managed to own six houses. 3019 !GCAT !GPOL President Jacques Chirac and Prime Minister Alain Juppe avoided a public outing to worship on Sunday as they discussed policy amid criticism of a police roundup of African migrants from a Paris church. Chirac and Juppe met for a second day in a Riviera fortress on issues ranging from immigration to record unemployment and the 1997 budget. They did not accompany their wives Bernadette and Isabelle who attended mass at Le Lavandou. Last year, both couples attended a Sunday service during a similar weekend of talks by the conservative leaders at the presidential retreat by the Mediterranean. Sunday's mass was given by a Zairean priest. Chirac and Juppe skipped going to church after riot police smashed their way into the Saint Bernard church in Paris and arrested 210 African immigrants protesting against expulsion orders. The often staid Le Monde newspaper carried a front-page cartoon in its weekend edition of Chirac and Juppe by the seaside in Bregancon with Chirac asking "Shall we go to church on Sunday?" Juppe replies: "Ah, have you got your axe?" . Chirac and Juppe, due to end their talks on Sunday evening, were discussing issues including the 1998 budget, immigration and fiscal reform amid union threats of unrest. Aides said that no decisions would be announced after the informal talks, partly aimed at underlining cohesion between the two men before a first cabinet meeting after the traditional summer break on Wednesday. The government faces a tightrope over the budget with unions trying to talk up a wave of public resistance for the autumn to repeat a crippling string of strikes in late 1995. The government has to curb public deficits to qualify for a single European currency from 1999 while delivering on promises of income tax cuts for 1997. The government is due to be unveiled on September 18. The two men got some encouragement from an opinion poll on Sunday, showing that voters were slightly less dissatisfied with their performance. The IFOP survey, for the Journal du Dimanche weekly, showed 38 percent were satisfied with Chirac's performance against 50 percent dissatisfied. In July, the split was 35-53. Juppe's less favourable rating improved to 31-57 percent from 30-59. 3020 !GCAT !GDIP !GPOL Three Algerian children returning home to France with their parents were sent back to Algeria on Sunday by the authorities at southern Belgium's Charleroi airport, local media reported. After six hours of argument airport police put the children, the oldest of whom is 15, on a flight back to Algiers, where the family had just been on holiday. The police ruled that the parents' papers were in order but the childrens' French identity papers did not allow them to enter Belgium, Belgian news reports said. Air Algeria routes travellers to northern France through Charleroi since suspending flights to Paris in June. The Algerian family had intended to drive to their Paris home from the airport, Belgian media said. There was no immediate comment from the Algerian embassy or the airport police. 3021 !GCAT !GCRIM !GPOL Top Mob boss Giovanni Brusca's decision to collaborate with investigators may help the defence in the Mafia trial of Giulio Andreotti, the former Italian prime minister's lawyer said on Sunday. Brusca, one of the Mafia's most fearsome bosses before his arrest in May, has dominated the headlines of Italy's newspapers since Friday, when magistrates confirmed he had decided to join a growing list of Mafiosi to turn state's evidence. While Italians were still debating if Brusca could be trusted, Andreotti and his lawyers jumped on media reports that Brusca had told investigators that he knew nothing about the statesman's alleged ties to the Mafia. "This is the perfect truth," said Andreotti, who has denied charges against him as part of a plot by some lying Mafia turncoats to punish him for crackdown on crime by the seven governments he headed. "If a Mafia boss, who was effectively 'on duty' until three months ago, maintains that he never knew anything about Andreotti, this will have to be taken into consideration," his lawyer, Francesco Coppi, told Corriere della Sera newspaper. Coppi said he would ask that Brusca be called as a witness at the trial of Andreotti, who is accused of being the Mafia main political protector for years. But Luigi Li Gotti, the lawyer assisting the 36-year-old Brusca since he decided to collaborate, said he was not aware that Brusca had discussed Andreotti with investigators. The case against Andreotti is based in part on testimony from a turncoat who claims he saw the life senator meet secretly with Mafia boss Salvatore Riina in 1987 and exchange a kiss of respect in Palermo. Andreotti says it would have been impossible to him to evade his police escort. Riina was arrested in 1993 after nearly a quarter of a century on the run and Brusca was widely believed to have taken his place at the top of the Corleonese clan until his arrest. Magistrates said they would treat Brusca cautiously, aware his "repentance" may be an attempt to take advantage of a generous witness protection programme that includes reduced sentences, a salary and the chance to change identity. Italy has for years debated the trustworthiness of once-bloodthirsty mobsters who swore religious allegiance to an organisation committed to fighting the state. Brusca gave investigators proof he was telling at least part of the truth when he directed them to an elaborate underground bunker hideout he and other Mafiosi had used in the past. The reinforced concrete bunker was connected to a house via a 60-metre (yard) tunnel in the Sicilian countryside. Investigators told Italian television on Sunday the hideout may be where Brusca allegedly strangled and disposed of in a vat of acid the 12-year-old son of a boss who had talked to police. Brusca is accused of pushing the button detonating a bomb under anti-Mafia magistrate Giovanni Falcone's motorcade on a motorway near Palermo in 1992. Falcone, his wife and three bodyguards died in the explosion. He is also accused of involvement in planning 1993 Mafia bombings against cultural monuments in Rome, Milan, and against the Uffizi art gallery in Florence. 3022 !GCAT !GDIP !GPOL !GVIO !GVOTE Bosnia's President Alija Izetbegovic appealed at the weekend to Bosnian refugees living in Germany to return to their homeland as they were urgently needed to help rebuild the war-torn country. Izetbegovic addressed some 20,000 fellow country men and women at a stadium in Gelsenkirchen as part of an election campaign tour of Germany, where 320,000 Bosnians live, in the run up to Bosnia's first post-war elections on September 14. Germany has taken in more Bosnian refugees than any other country outside former Yugoslavia. Izetbegovic called on the international community to provide financial aid to help refugees return home and thanked Germany for providing them with a place of refuge from the war. "The world must give the refugees support to help them return home," he said in a speech on Saturday evening at a Bosnian cultural at Park Stadium in the western city of Gelsenkirchen. Izegbegovic was campaigning for his Democratic Action Party (SDA) and the event was organised by an Islamic cultural society for ex-Yugoslavia based in Duesseldorf. The Organisation for Security and Cooperation in Europe expects some 140,000 Bosnians to vote in Germany. 3023 !GCAT !GCRIM !GDIP Africans seized in a raid on a French church won legal battles on Sunday when police scrapped expulsion orders against 45 of them and a judge released more of the dwindling group of detainees, lawyers said. "Out of 80 cases presented to the administrative court, Paris police headquarters has decided to repeal 45 expulsion orders," lawyer Caroline Mecary told Reuters. Four of the Africans were deported on Saturday night on a plane that flew to Mali, Senegal and Zaire as Prime Minister Alain Juppe sought to balance a crackdown on illegal immigration with a promise of "humanity". It was unclear how many of the 210 Africans originally seized by riot police on Friday in Paris' Saint-Bernard church, including 10 on a 50-day hunger strike when police swooped, were still in detention. The church raid triggered protests against the centre-right government and clashes between stone-throwing protesters and riot police in Paris on Friday night and again around a military airbase when the first Africans were deported. All 68 children and almost all 54 women were freed on Friday and Saturday along with some of the 98 men. A Paris civil court released 39 of the Africans from detention on Sunday, ruling police had violated legal technicalities, notably because arrest documents were not signed by a sufficiently senior official. But the release from detention did not mean the 39 would get residence permits, nor that they were cleared of possible expulsion. Out of 53 cases presented, the court agreed to extend detention for 14 other people. "What's worrying and bothersome is that there are still 14 held and we have the greatest concern for them," the Africans' lawyer Francois Breteau told France Info radio. Lawyers have argued from the start that the use of riot police, using batons and tear gas, was illegal in a church peacefully occupied by the immigrants. Spokesmen for the group said the 10 hunger strikers, who are under medical supervision in detention, were keeping up their fast, protesting against expulsion. One man had started refusing to take liquids. Balancing the crackdown, the Interior Ministry said on Saturday that more than 40 of those seized in the church would be granted residence permits in coming days "due to family or health situations". It was not clear if the 45 scrapped expulsion orders corresponded to these cases. The Africans had demanded residence rights for all. Officials at Juppe's office said the conservative prime minister was willing to soften implementation of tough 1993 immigration laws, long slammed by the left-wing opposition, human rights activists and immigrants as unworkable. They said Juppe, meeting President Jacques Chirac in the president's Riviera retreat for a weekend of talks, wanted to make the laws more "efficient" and more "humane". Similar words were used by the government before Friday's raid. Saturday's plane was the 23rd charter plane since the government took office in May 1995. The 1993 immigration laws, named after former interior minister Charles Pasqua, are a tangle partly because some immigrants, such as parents of children born in France since 1993, can now neither be expelled nor obtain residence permits. 3024 !GCAT !GCRIM !GDIP An international conference on the commercial sexual exploitation of children begins in Sweden this week in a glare of attention raised by a horrific child-sex case unfolding in Belgium. United Nations Children Fund spokeswoman June Kane said the Belgian case, in which children were abducted and sexually abused and two were left to starve to death, emphasised the need for firm action to stop sexual exploitation of children globally -- not just in the Third World. "This horrific case just shows that this is happening worldwide, not just in Thailand, Sri Lanka and the Philippines where child sex tourism is rife," Kane told Reuters. "This has hit everyone with a bang." The conference will focus on child prostitution, pornography and the sale of children for sexual purposes. UNICEF estimates that more than one million children a year are forced into child prostitution, trafficked, or used in child pornography but most studies have centred on Asia. Organisers of the five-day conference, starting August 27, said the Belgian case has sparked more interest in the congress after triggering a Europe-wide alert for paedophile gangs. Over 1,000 government, inter-governmental and non-government delegates and over 200 journalists from 130 countries will attend the conference to discuss the scope of the problems, legal reform, and raising public awareness. Delegates include actor Roger Moore, a goodwill ambassador for UNICEF, about 50 ministers from different countries, and a youth panel with some teenagers who were victims themselves. Interest had already been high in the conference that was first mooted two years ago by the Swedish branch of the Save the Children Fund and supported by the Swedish government. "But we have had more people wanting to come since the Belgian affair," said head of the press centre, Lars Lonnback. UNICEF, End Child Prostitution in Asian Tourism (ECPAT) and the Non-Government Organisation Group on the Rights of the Child have helped to organise the congress which is being treated as a one-off event at present. The conference will be opened by Swedish Prime Minister Goran Persson and closed by Sweden's Queen Silvia, who in a rare outburst last month attacked Swedish politicians for not yet making the possession of child pornography illegal. "It's a shame that Sweden, as host country to the conference, has still not criminalised possession of child pornography," Madeleine Leijonhuvud, criminal law professor and congress committee member told Reuters. A 15-strong delegation from Belgium, including Foreign Affairs Minister Erik Derycke, will attend the conference. Belgium's ambassador to Sweden, Carlos De Wever, told Reuters the minister would speak to the congress about the recent case in his home country and the action being taken. The case that has shocked the world came to light this month when two kidnapped girls were rescued from a makeshift dungeon at the home of a convicted child rapist. Police then found the bodies of two other kidnapped girls who had died of starvation and are searching for two other missing girls. "Our population is in shock over this horrific case," De Wever told Reuters. "This is obviously a worldwide problem but that it has arisen in Belgium has stunned everybody. "The public is now so much more involved in this issue that we are glad there is a conference like this one to air this dreadful problem and formulate some action." 3025 !G15 !G154 !GCAT !M12 !MCAT The successful creation of an integrated European government bond market based on a single currency could make it rival that of the U.S. and Japan, the Bank for International Settlements (BIS) said. A single European currency would change Europe's bond markets profoundly, but this could bring advantages to both borrowers and investors and possibly boost the stature of the European bond market, BIS said in its latest quarterly report on banking and financial markets. "In an integrated Euroepean government bond market, investors might be more willing to buy large quantities of bonds if they could sell them without encountering reduced liquidity and any associated increase in volatility," BIS said. Prospective interest savings through higher liquidity could encourage cooperative debt management and governments could auction issues jointly with identical coupons and maturities. Governments could also match each others' coupons and maturities, in effect reopening each others' issues. "Were the similarities to prove sufficiently strong that the bonds were covered by a single set of exchange-traded futures contracts, then Europe's main bond market would join those of the United States and Japan in terms of size and liquidity," BIS said. While the exchange and inflation risks would not distinguish between government bonds within a single currency Europe, markets would still distinguish between the creditworthiness of various governments, much like markets price provincial or state debt in federal systems, BIS said. Another possibility is that the bonds of some or all of the governments participating in Europe's monetary union could trade interchangeably. Markets are already allocating very slight differences to the credit ratings, single market bond yield spreads and swap spreads between the countries that are seen as likely candidates for early entry to EMU in 1999, according to a poll of market participants taken in January 1996, BIS said. -- Peter Nielsen, Zurich Editorial +41 1 631 7340 3026 !GCAT These are the leading stories in the Algerian press on Sunday as reported by the official Algerian news agency APS. Reuters has not verified these stories and does not vouch for their accurarcy. LE MATIN - A national conference may take place in September and will be preceded by a new round of multilateral talks between political parties and the presidency. EL MOUDJAHID - Prime Minister Ahmed Ouyahia told a Economic and Social National Council (CNES) meeting that Algeria needs a national development plan after its victory over an attempt of destabilisation. LIBERTE - Democratic political forces scored a victory over conservative parties after a joint committee drafted a new proportional election law replacing a two round majority voting system. 3027 !GCAT !GCRIM The deaths by starvation of eight-year-old girls Julie Lejeune and Melissa Russo while in the hands of a paedophile gang have united Belgium in grief but threaten to divide it again in anger. Belgian police have arrested six people, including one woman, and seized some 400 paedophile porn video tapes and quantities of magazines in the inquiry so far. The tender age of the victims, graphic pictures of the makeshift dungeon in which they were kept and the probability that the affair was linked to an international paedophile ring have raised emotions to boiling point. The manner in which the two youngsters died -- starved to death nine months after being abducted in June last year -- has served to throw new light on a problem that knows no borders and has been around for a long time. Sexual abuse of children is a global issue. More than a million children around the world have been forced by economics or coersion into prostitution, according to child rights lawyer Michele Hirsch. Counting is difficult, solving the problem is much harder. At least three petitions are doing the rounds in Belgium following the discovery last weekend of the two dead girls, the rescue of two others and the admission by the key witness, Marc Dutroux, that he had kidnapped two more. One petition demands the reintroduction of the death penalty, another urged that there should be no parole for convicted child rapists, and there was also a blanket call for tougher penalties all round. Even people who would normally count themselves as liberal are now seriously considering demanding the death penalty for child abusers and killers. Many are not even aware that Belgium finally erased the death penalty -- by the guillotine -- from the statute books in June after it had lain dormant for many years. "These people should be killed," said 14-year-old Marie-Char as she waited with thousands of others of all ages and walks of life to pay homage at the funeral of Julie and Melissa in Liege last Thursday. "They deserve the death penalty," said mother-of-two Claudine. Most aree with the sentiment but not necessarily with the solution. "The death penalty has gone, but we still have to punish these people," said another woman at the memorial service for the two girls. Gino Russo, Melissa's father, who has acted as a spokesman for the two girls' parents, has also distanced them from the death penalty calls in a show of moderation that has been widely praised. Herman de Croo, leader of the main opposition party in Belgium, told Reuters the death penalty was gone for good but there would definitely be changes in the law to control the early release of child sex offenders. Dutroux, 39, was released for good behaviour in 1992 after serving only three years of a 13-year sentence for multiple child rape. But as far as Hirsch is concerned, simply locking up abusers and throwing away the key is no answer. "If you don't deal with the demand there is no solution," she told Reuters in an interview. "You have to treat the victims because every time you treat an abuser you find that the abuser was abused. It will take a long time -- 20 years at least -- but it is the only way of treating what is a global problem," she said. 3028 !GCAT !GODD The guardians of the Portuguese language are going on the offensive to halt the increasing use of foreign words. The Society of the Portuguese Language (SPL), a non-profit foundation with no formal authority, has set up a commission of volunteers to monitor what it sees as the growing abuse of Portuguese by foreign expressions, mainly English. The commission will monitor the media, state decrees and advertisements for the unjustified use of foreign words and plead with the authors to stick to Portuguese. "The aim of the commission is to make people write and speak their language well, and to love Portuguese," said SPL president Jose Antonio Camelo. "But it is not going to police the language," he added. He said Portuguese was in a chaotic state because grammar was taught inadequately in schools and teachers were not properly trained. Furthermore, the use of English in international business, films, rock music and computer technology was making inroads into Portuguese, spoken by an estimated 200 million people around the world. Camelo said he did not object to English usage where there were no Portuguese equivalents, such as "video clip" and "leasing". But he called for a language policy to invent Portuguese equivalents or give a Portuguese slant to foreign words, as in the present use of "blusa" for blouse and "clube" for club. In his works early this century, the celebrated Portuguese author and former president Manuel Teixeira Gomes gave a twist to foreign words such as French's "boulevard", which he called "bulevar". What Camelo objects to is the abuse of his language by foreign words that have a Portuguese equivalent. "Near Lisbon I know a garage with a 'car wash' sign in English. I think this is quite unreasonable, when in Portugal we say 'lavagem de carro'," Camelo told Reuters. "I have seen signs saying 'shop' in English, instead of using the Portuguese word 'loja' which is quite adequate." The SPL's six-strong commission, due to be launched formally in September, would write to the owner of the car wash business and ask him to refrain from using the English expression, Camelo said. The same approach would be made to "shop" owners. Camelo has asked a local lawyer to search Portuguese law to see if abusers of the language could be prosecuted, in which case the SPL would inform the authorities of any violations. Camelo said he objected to the use of English as the language of tuition in mathematics courses by foreign teachers at the universities of the Algarve in southern Portugal and Covilha in the northeast. Portugal's Academy of Sciences was drawing up a new dictionary of common Portuguese usage due for publication next year, estimated to contain at least 4,000 foreign words. A generation ago, the number of foreign words used in Portuguese was far less, Camelo said. He said he was worried about the declining use of Portuguese by descendants of Portuguese emigrants around the world and he hoped the new Commonwealth of Portuguese-Speaking Countries (CPLP) would defend the language. The CPLP, launched in Lisbon last month, aims to unite the interests of Portugal and its former colonies of Angola, Brazil, Cape Verde, Guinea-Bissau, Mozambique and Sao Tome and Principe, which have all felt the pressing influence of English. "We realise this is a problem not just for Portuguese, but for other languages as well," Camelo said. "But some one has to draw the line and take a stand." 3029 !GCAT !GPRO !GREL Mother Teresa, fighting for her life on a hospital respirator, showed faint signs of renewed strength on Sunday and blessed a group of nuns who visited her in the intensive care unit. "She blessed some of the sisters of Missionaries of Charity who were allowed to see her in the evening," Dr S.K. Sen, medical director of Woodlands Nursing Home, told reporters. "She blessed them by raising her hand gently." Sen said the nuns were allowed to visit the renowned founder of their 47-year-old Roman Catholic order after doctors had noticed a slight improvement in her condition. "Mother Teresa had no further cardio-vascular problems during the day, though her heart rate is still irregular," said the smiling doctor. The 85-year-old missionary was taken to hospital on Tuesday with a high fever and severe vomiting. Later she suffered heart failure and was diagnosed with malaria and a chest infection. On Sunday, after several days of antibiotics, her fever abated. But Mother Teresa, who marks her 86th birthday on Tuesday, continued to need the respirator. "She is still seriously ill. We cannot say she is out of danger unless respiratory support is switched off," Sen said. "We are very much encouraged by today's progress. By tomorrow we hope things will significantly improve." The doctor, part of a six-member team of specialists treating Mother Teresa, said the respirator amounted to a life support system which they were trying gradually to withdraw. Asked to what extent the respirator was breathing for Mother Teresa, Sen said: "It's fifty-fifty. She is not yet able to breathe on her own but we hope she will be able to breathe completely on her own tomorrow." Earlier thousands of people, including Moslems and Hindus, joined in prayer for the Albanian-born nun as she fought against a faltering heart in the hospital in Calcutta, one of the world's poorest and most overcrowded cities. Thousands of people joined in Catholic Sunday services at churches across India in a spontaneous outpouring of concern. Special prayers were held at the Mother House, the sprawling headquarters of the Missionaries of Charity, the order Mother Teresa founded in 1949 to help the poor and destitute. More than 100 nuns and volunteers gathered at mass to pray for Mother Teresa, also known as the Saint of the Gutters for devoting her life to the poor. "Even a maulvi (Moslem cleric) came and knelt in the chapel," said Sister Priscilla, a senior nun at the order. She said several Hindus and Moslems had also visited Mother House to inquire about Mother Teresa, adding: "She is a living saint for everybody here." Since 1989 when she was fitted with a heart pacemaker, Mother Teresa has been periodically admitted to hospital. In 1991, she was treated at a California hospital for heart disease and bacterial pneumonia. In 1993, she fell in Rome and broke three ribs. In August the same year, she developed malaria, complicated by her heart and lung problems. Last April she fractured her left collar bone. "She is greater than any mother in this world. I would have died of cold if I hadn't come here," said Nada, one of about 100 destitutes at Mother Teresa's Calcutta shelter for the homeless. 3030 !GCAT !GDIS A bus fell from a mountain road into a river in Pakistan-ruled Azad (free) Kashmir on Sunday, killing at least 19 people and injuring 11, police said. They said dead included five refugees from the Indian-ruled part of Kashmir, where Moslem militants have waged a separatist revolt since early 1990. The police said 14 of the 45 passengers on the bus died instantly when the vehicle fell into Kunar river from a narrow road leading from the state capital Muzaffarabad to the nearby Pakistani town of Garhi Habibullah northwest. Five people died later in hospital. 3031 !GCAT !GDIS !GREL Indian army helicopters plucked some 2,000 Hindu pilgrims stranded by icy rain and snow on Sunday from a rugged Himalayan trail where at least 121 have died, officials said. For the first time in four days the weather improved, allowing helicopters to reach pilgrims who included "sadhus", Hindu holy men who made the trek in Jammu and Kashmir state naked, their bodies smeared with ash. Up to 70,000 pilgrims, caught by a sudden onset of bad weather, were stranded for a fourth day at heights of up to 3,700 metres (12,136 ft), the officials said. Some 112,000 Hindus arrived in Kashmir this year to visit the holy Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu God Shiva. The Press Trust of India put the toll, resulting from high monsoon rains, snow and sub-zero temperatures, at 160. Officials in Srinagar, Jammu and Kashmir's summer capital, put the death toll at 121. State government spokesman K.B. Jandial said 2,000 people were flown to Srinagar and other Kashmiri towns by three military helicopters which carried out 50 sorties. One eyewitness said officials faced protests as army helicopters moved people to safety from one area. S. Tariq, a cameraman with the New Delhi-based Asian News International news agency, told Reuters: "There were 38 dead bodies laid out on the ground in a row." Tariq said some pilgrims complained that help had come slowly. He quoted a middle-aged woman, as saying: "If my parents are left behind the government would be held responsible." Some 650 people were still stranded around the high-altitude lake of Sheshnag, 60 km (38 miles) from Srinagar, and Panchtarni, nine km (six miles) beyond, only six km (four miles) from the holy cave of Amarnath, Jandial, the spokesman, said. Thousands had trekked down to the base camp at Pahalgam, some 100 km (62.5 miles) by road from Srinagar. The number of stranded there had risen by 5,000 to 60,000, Jandial said. Floods made impassable all roads leading to the town. Those stranded included people strung out along the 50-km (30-mile) route from Pahalgam to the 3,880 metre (12,725 ft)-high Amarnath cave, officials said. Between 300 and 400 soldiers were detailed to escort pilgrims trekking down the sides of the Kashmir valley, Jandial said. He said there were no pilgrims left at the cave. The helicopters also dropped food, medicine and blankets to help some 3,000 people on a thickly-forested part of the route near the frozen Sheshnag lake. "The priority was to bring back ailing pilgrims," added Jandial, who said helicopters also took oxygen cylinders to pilgrims near the lake. The lake is about 15 km (nine miles) south of Amarnath and is normally the third stage of a five-day trek to the cave. 3032 !GCAT !GDIS !GREL Indian troops with helicopters and relief supplies battled on Sunday to rescue thousands of Hindu pilgrims stranded along a rugged Himalayan trail after at least 116 died from cold, officials said. Up to 70,000 pilgrims were stranded for a fourth day at heights of up to 3,700 metres (12,136 ft) in Jammu and Kashmir state, the officials said. They were all reported to be safe. For the first time in four days the weather improved on Sunday, allowing stepped up efforts to rescue pilgrims who included naked "sadhus", or Hindu holy men smeared only in ash. "The weather is improving. That is a silver lining," state government spokesman K.B. Jandial told Reuters in Srinagar, Jammu and Kashmir's summer capital. "At least 116 yatris (pilgrims) have died so far," he said. The United News of India put the death toll, resulting from high monsoon rains, snow and sub-zero temperatures, at 133. Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the holy Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu God Shiva. Two army helicopters flew about 60 pilgrims suffering from breathing trouble and other cold-related ailments to a Srinagar hospital on Sunday, officials said. The helicopters also dropped food, medicine and blankets to help some 3,000 people on a thickly-forested part of the route near the frozen Sheshnag lake, 60 km (38 miles) from Srinagar. "The priority was to bring back ailing pilgrims," added Jandial, who said helicopters also took oxygen cylinders to pilgrims near the lake. The lake is about 15 km (nine miles) south of Amarnath and is normally the third stage of a five-day trek to the cave in some of the world's most scenic but rugged areas. Jandial said between 300 and 400 soldiers were detailed to escort pilgrims trekking down the sides of the Kashmir valley. Paramilitary troops also joined the rescue operations. He said there were no pilgrims left at the cave. Those stranded included 15,000 devotees strung along the 50-km (30-mile) route to the Amarnath cave, officials said. The cave is at 3,880 metres (12,725 ft). The officials said about 55,000 people were stranded at the trek's starting point, Pahalgam. All roads leading to the town were impassable because of flooding. Pahalgam is about 40 km (25 miles) east of Srinagar by air but more than double that by road. The Hindu nationalist Bharatiya Janata Party demanded an inquiry into the deaths, the Press Trust of India said. A doctor at a makeshift pilgrim camp said: "The main reason for the deaths is that the pilgrims had no warm clothing. Many were were old people. The holy men were trekking naked." The taxing trek across India's only Moslem majority state had to be halted soon after the unexpected weather. It had been scheduled to end this Wednesday. "We have moved almost 30,000 people out of the vicinity of the cave, removing them from the highest sector of the trek since yesterday," a spokesman told Reuters in New Delhi. Last year the pilgrimage was threatened by Moslem separatist guerrillas who staged two bomb attacks on the heavily guarded pilgrims. A civil servant was killed in one of the blasts. 3033 !GCAT !GPRO !GREL Thousands joined in prayer on Sunday for Mother Teresa, the Catholic nun whose devotion to the poor has inspired the world, as she fought for life against a weakening heart in a Calcutta hospital. Mother Teresa, admitted to hospital on Tuesday with malarial fever and severe vomiting, is conscious but in grave condition as her heart remains vulnerable, a hospital official said. The 85-year-old nun remained on a respirator in intensive care and was still being fed intravenously. "Mother Teresa's condition shows no appreciable change," Dr S.K. Sen, medical director of the Woodlands Nursing Home, told reporters. "Her cardiac irregularity is under control but she still needs respiratory support. She still has a low-grade fever." Thousands of people, including Moslems and Hindus, joined in Roman Catholic Sunday services at churches across India in a spontaneous outpouring of concern for the Nobel peace laureate. Special prayers were held at the Mother House, the sprawling headquarters of the Missionaries of Charity, the order Mother Teresa founded 47 years ago to help the poor and destitute. "Even a maulvi (Moslem cleric) came and knelt in the chapel," said Sister Priscilla, a senior nun. She said several Hindus and Moslems had also visited Mother House to inquire about Mother Teresa. "She is a living saint for everybody here," she added. More than 100 nuns and volunteers gathered at Sunday mass to pray for Mother Teresa, also known as the Saint of the Gutters for devoting her life to the poor. "Mother continues to struggle. I believe there are only certain things medicines can do," said Father Jeff Bayhy, who said the mass. "Mother is one of those people God has a plan for. God has a special plan for her." Bayhy, from Baton Rouge in Louisiana, has known Mother Teresa for 10 years and regularly visits her in Calcutta. "They love Mother and they don't want her to die but they don't fear her dying if that is what God has in store," he said. Mother Teresa was conscious, but had not spoken to anyone, Dr. Sen said. Anything could hapen, given her age, he said. "It might take days. At this age, anything could happen," Sen said in reply to a question about how long Mother Teresa would be on the respirator. Her doctors have forbidden visitors. A panel of six specialists have maintained a round-the-clock vigil over Mother Teresa, whose heart was fitted with a pacemaker in 1989. On Saturday, Mother Teresa's fever fell slightly and Sen had said she was showing surprising strength, though her weak heart complicated the picture. "She is showing enormous strength, given her age, which has surprised all of us," Sen told reporters. Mother Teresa's 86th birthday is next Tuesday. "She is greater than any mother in this world. I would have died of cold if I hadn't come here," said Nada, one of about 100 destitutes at Mother Teresa's Calcutta shelter for the homeless. Nada spent a year rummaging through rubbish heaps and begging for food in Calcutta's streets before he came to Mother Teresa's home. Now he, like others in the shelter, is praying for Mother Teresa to recover and resume her daily rounds. "All of them are praying to God for Mother's recovery," said Sister Dolores, one of six nuns who work in the home. "None of them has ever seen a bible, but they are praying because they know it could save Mother." 3034 !GCAT Following are some of the main stories in Sunday's Pakistani newspapers: DAWN - At least 23 people were killed in floods after rains in Lahore in central Pakistan. - Banks, leasing companies and mutual funds have some seven billion rupees ($197 million) stuck up in the stock market on account of shares they under-wrote in the past three years. - The government may not cut import duty on tea despite the growing demand from the Pakistan Tea Association. - Sugar-cane growers and sugar mills urged the government to restrict import of sugar after assessing the actual shortage. - Authorities in Khyber Agency burnt an abductor's houser in Bara sub-division and exacted a fine of 100,000 rupees. BUSINESS RECORDER - Weekend rains caused losses of 400 million rupees in five major markets in Lahore. - Several letters of credit for basmati rice exports to the Middle East expired for lack of shipping service between Karachi and the Gulf. FINANCIAL POST - Mobile phone companies are seriously considering suing the government for breach of contract due to the continuing ban on cellular services in their most lucrative market in Karachi. - A three-member World Bank Private Sector Assessment mission is in Islamabad for wide-ranging talks with government officials for revamping Pakistan's dormant private sector. - PTCL is likely to pay a 1.78 percent cash dividend for the year ended in June. THE NEWS - Pakistan will send a team of senior economic officials to Washington next month to negotiate with the International Monetary Fund and World Bank at their annual meetings. - Afghan Islamic Taleban militia overran Spina Shega, an important military base of Prime Minister Gulbuddin Hekmatyar's Hezb-i-Islami party in the eastern province of Paktiya. - Ex-finance minister Sartaj Aziz, secretary general of the main opposition Pakistan Muslim League, called the government's energy policy disastrous, saying privatisation of the Jamshoro power plant should be suspended and no more private sector thermal power project be approved for the next five years. - The vessel Malakand is due to arrive in Karachi in the first week of September with previously embargoed U.S. arms for the Pakistani army and navy. -- Islamabad newsroom 9251-274757 3035 !GCAT !GPRO Doctors battling to save the life of Mother Teresa, the Roman Catholic nun known as the Saint of the Gutters, said her condition showed signs of improvement but she remained on a respirator to assist her faltering heart. "She is improving," said an official at Calcutta's Woodlands Nursing Home where six doctors are keeping a round-the-clock vigil on Mother Teresa, 85, winner of the 1979 Nobel peace prize. Doctors said her heartbeats were less irregular and she was breathing easier than before. She even managed to raise her hand to bless a group of nuns from the missionary order which she founded to care for the destitute and dying in Calcutta. "She blessed some of the sisters of Missionaries of Charity who were allowed to see her in the evening," Dr S.K. Sen, the nursing home's medical director, told reporters late on Sunday. "Mother Teresa had no further cardio-vascular problems during the day, though her heart rate is still irregular," Sen said. "We are very much enouraged by today's progress. By tomorrow we hope things will significantly improve." Asked to what extent the respirator was breathing for Mother Teresa, who will be 86 on Tuesday, he said: "It's 50-50. She is not yet able to breathe on her own but we hope she will be able to breathe completely on her own tomorrow." She was admitted to the hospital last Tuesday with a high temperature and severe vomiting. Doctors said later she was suffering from irregular cardiac beats and a nagging fever caused by malaria. Roman Catholics churches held special prayers for her recovery and thousands of people in Calcutta, including Moslems and Hindus, joined in prayers for the Albanian-born nun. Special prayers were also held at Mother House, the sprawling headquarters of the Missionaries of Charity, the order which she founded in 1949 to relieve suffering among Calcutta's teeming millions. The order now has nearly 3,000 people working in the slums of 200 cities worldwide to minister to the needs of the homeless, AIDS patients, the mentally depressed and orphans. "She is a living saint for everybody," said Sister Priscilla, a senior nun of the order. "She is greater than any mother in this world. I would have died of cold if i hadn't come here," said Nada, one of about 100 destitutes who found a haven at her Calcutta shelter for the homeless. 3036 !C42 !CCAT !E21 !E211 !E41 !ECAT !GCAT !GJOB The Sri Lankan government on Sunday announced a 50 percent pay hike for state sector employees and military personnel spread over two years and costing eight billion rupees annually. A government statement said the pay hike, based on recommendations of a government commission which examined state sector salaries, would be accompanied by regular performance appraisals to raise productivity in the public service. The wage hike would be based on 1993 salary levels to restore a coherent public sector salary structure and eliminate distortions caused by ad hoc wage hikes after 1993, it said. It will be spread over two years, the first from January next year and the second from January 1998, because of financial constraints, the statement said. The statement did not make clear how much the first year's wage hike would be and government officials were not available for comment. Pensions of state employees will also be raised by 10 percent over the same period, the statement said. The government also plans to review state sector salaries every five years, it said. 3037 !GCAT !GVIO The planned reopening of Afghanistan's main northern Salang highway as a result of peace talks with an opposition alliance has been put off until Wednesday, official Kabul Radio said on Sunday. The embattled Afghan government said last week that the Kabul-Salang highway would be opened on Monday or Tuesday following talks with the Supreme Coordination Council alliance led by Jumbish-i-Milli movement of powerful opposition warlord General Abdul Rashid Dostum. The radio said on Sunday the postponement of the opening had been made due to "precautions". It did not elaborate. The Salang highway, Afghanistan's main route to Central Asia, has been controlled by Dostum since he began fighting President Burhanuddin Rabbani's government in Kabul in January 1994 in alliance with Hezb-i-Islami party leader Gulbuddin Hekmatyar, then prime minister but rival to the president. Hekmatyar rejoined the government as prime minister last June under a peace pact with Rabbani and has since been trying to persuade other opposition factions to follow suit. Earlier this month, Jumbish denied a Kabul government statement that the two sides had agreed to a ceasefire in the north. 3038 !GCAT !GPRO Mother Teresa, battling for her life on a hospital respirator, had no further heart problems on Sunday and blessed a group of nuns who visited her in the intensive care unit, a doctor said. "She blessed some of the sisters of Missionaries of Charity who were allowed to see her in the evening," Dr S.K. Sen, medical director of Woodlands Nursing Home, told reporters. "She blessed them by raising her hand gently." Sen said the nuns were allowed to visit the renowned Roman Catholic missionary after doctors had noticed a slight improvement in her condition. "Mother Teresa had no further cardio-vascular problems during the day, though her heart rate is still irregular," Sen said. The 85-year-old missionary, who was taken to hospital on Tuesday with a high fever and severe vomiting, no longer had a temperature but continued to need the respirator, he said. "She is still seriously ill. We cannot say she is out of danger unless respiratory support is switched off," he said. "We are very much encouraged by today's progress. By tomorrow we hope things will significantly improve." Sen was asked to what extent the respirator was breathing for Mother Teresa. "It's fifty-fifty," he said. "She is not yet able to breathe on her own but we hope she will be able to breathe completely on her own tomorrow." 3039 !GCAT !GPOL Students backed by opposition parties battled police and burned an effigy of Prime Minister Sheikh Hasina during a strike in the north Bangladeshi town of Bogra on Sunday. The strikers barricaded streets, attacked the local office of the ruling Awami League, fought running battles with police and set alight hundreds of copies of the popular "Janakantha" newspaper, alleging it was pro-government. Police used batons and teargas to try to disperse students who were throwing stones and home-made bombs, witnesses said. The strike, called by the main opposition Bangladesh Nationalist Party (BNP), to denounce the deaths of four students killed by police over the last few days, coincided with a visit to the area by Hasina. Local officials said one policeman was killed by gunshots during clashes with pro-opposition students on Thursday. Hasina told a cross section of people at the Bogra police headquarters on Sunday that the government had already suspended three police officers and ordered a judicial probe into the violent incidents. The prime minister offered financial grants to the families of those killed, ordered the best possible medical care for the injured and urged Bogra residents to call off the strike. Opposition legislators walked out of parliament in Dhaka on Sunday denouncing "unprecedented police barbarity" against opposition students and supporters. They renewed their call for the resignation of Home (Interior) Minister Rafiqul Islam. Hundreds of police raided the Dhaka university on Sunday, arresting nearly 30 outsiders who had been living in student dormitories and seizing weapons, university officials said. Police stormed ten residence halls on the campus, flushed out people at gunpoint and searched their baggage. They seized revolvers, sawn-off rifles, shotguns and knives. The students were later allowed to return. The swoop followed the resignation of the university's Vice-Chancellor Dr. Emajuddin Ahmed on Saturday over the deteriorating law and order situation on the campus. Authorities closed down the 28,000-student university on Wednedsay following gunbattles between students and police. Police said they fought armed activists from the BNP, headed by former prime minister Begum Khaleda Zia. Hasina told police the home ministry had already given a "blanket order" to arrest terrorists and possessors of illegal firearms irrespective of their political identities. Nearly 100 students have been injured in the clashes in Dhaka and Bogra, police told reporters. 3040 !GCAT !GDIS At least 16 people were killed and several injured on Sunday when a bus fell from a mountain road into a ravine on a river bank in Pakistan-ruled Azad (free) Kashmir, police said. They said 14 out of 45 passengers on the bus died instantly when the vehicle fell from the narrow road while on its way from the state capital Muzaffarabad to the nearby Pakistani town of Garhi Habibullah in the northwest. Two died later in hospital. 3041 !GCAT !GPRO The condition of 85-year-old Mother Teresa, the Nobel peace laureate whose devotion to the poor has inspired the world, improved slightly on Sunday, a spokeswoman for her Missionaries of Charity order said. "The doctors say her general condition has improved slightly although she is not out of danger," Sister Priscilla, a senior nun, told Reuters. She gave no further details. Thousands of people, including Moslems and Hindus, earlier joined in prayer for the Albanian-born nun as she fought against a weakening heart in a nursing home in Calcutta, one of the world's poorest and most overcrowded cities. Mother Teresa was admitted to the Woodlands Nursing Home on Tuesday with malarial fever and severe vomiting. A hospital official said earlier on Sunday she was conscious but in grave condition because her heart remained vulnerable. Mother Teresa, who marks her 86th birthday on Tuesday, remained on a respirator in intensive care and was still being fed intravenously. "Mother Teresa's condition shows no appreciable change," Dr S.K. Sen, medical director of the Woodlands Nursing Home, told reporters on Sunday morning. "Her cardiac irregularity is under control but she still needs respiratory support. She still has a low-grade fever." Thousands of people joined in Catholic Sunday services at churches across India in a spontaneous outpouring of concern. Special prayers were held at the Mother House, the sprawling headquarters of the Missionaries of Charity, the order Mother Teresa founded 47 years ago to help the poor and destitute. "Even a maulvi (Moslem cleric) came and knelt in the chapel," Sister Priscilla said. She said several Hindus and Moslems had also visited Mother House to inquire about Mother Teresa, adding: "She is a living saint for everybody here." More than 100 nuns and volunteers gathered at Sunday mass to pray for Mother Teresa, also known as the Saint of the Gutters for devoting her life to the poor. Mother Teresa was conscious but had not spoken to anyone, Sen, the doctor, had said. Anything could happen, given her age, he added. "It might take days. At this age, anything could happen," Sen said in reply to a question about how long Mother Teresa would be on the respirator. Her doctors have forbidden visitors. A panel of six specialists have kept a round-the-clock vigil over Mother Teresa, whose heart was fitted with a pacemaker in 1989 -- 10 years after she won the Nobel Peace Prize. On Saturday, Mother Teresa's fever fell slightly and Sen had said she was showing surprising strength, though her weak heart complicated the picture. "She is showing enormous strength, given her age, which has surprised all of us," Sen said. "She is greater than any mother in this world. I would have died of cold if I hadn't come here," said Nada, one of about 100 destitutes at Mother Teresa's Calcutta shelter for the homeless. Nada spent a year rummaging through rubbish heaps and begging for food in Calcutta's streets before he came to Mother Teresa's home. Now he, like others in the shelter, is praying for Mother Teresa to recover and resume her daily rounds. "All of them are praying to God for Mother's recovery," said Sister Dolores, one of six nuns who work in the home. "None of them has ever seen a bible, but they are praying because they know it could save Mother." 3042 !GCAT !GPRO Teresa Singha joined thousands of Indians in prayer on Sunday (corrects day from Saturday) for her 85-year-old namesake Mother Teresa, who gave her the chance five years ago to rebuild a life shattered by mental illness. Abandoned by her mother when she was just seven, life was difficult for Teresa Singha until 1991. She tried to commit suicide five times. Then she came to live at Shanti Daan (Gift of Peace), a home for the care of mentally ill women set up by Mother Teresa in India's eastern city of Calcutta. Now 25, she is one of several women gradually putting together the broken pieces of their lives within the serenity of Shanti Daan. On Sunday she sat down with scores of mentally ill girls to pray for the recovery of Mother Teresa, now battling for life against a weak heart and malarial fever. "I heard Mother is sick, that is sad," Teresa Singha said. "I was told that when she first met me she blessed me before I touched her feet." On Sunday a spokeswoman for Mother Teresa's missionary order said that the Nobel peace laureate's condition had improved slightly. Earlier, doctors had said her heart problem was under control but she had low-grade fever. Like the rest of the 180 women in the home, Teresa Singha's family abandoned her after her mental illness worsened. Some had even been jailed as "potential hazards to society". "Mother was the first person to open her hands when the West Bengal government said it did not know what to do with these women," said Sister Jovita, the nun in charge of Shanti Daan. Sister Jovita is a Missionary of Charity, the religious order Mother Teresa founded 47 years ago to look after the poor. It has run Shanti Daan since it was set up in 1988. Teresa is not very sure how she came to Shanti Daan, but Sister Jovita says she was a domestic helper in several homes before she "was abused". "She lost her normal self. She was handed over to us by another voluntary organisation," the nun said. Alo Ghosh, 40, was deserted by an alcoholic who married her after the death of her first husband. Her second husband ran off with all her money and jewellery. When she became mentally ill, neighbours paid off the police to put her in jail, she said. But today she is much better and is slowly regaining her memory. Alo and Teresa both prayed for Mother Teresa on the weekend. They plan to celebrate Mother Teresa's birthday on Monday, along with the Missionaries of Charity. Mother Teresa will turn 85 only on Tuesday but traditionally the Missionaries of Charity celebrate it a day earlier. Conditions in most Indian jails are bad with inmates complaining of torture, poor food and ill-treatment. Alo said some of the mentally ill used to be given electric shocks by jail officials. "Some girls used to be beaten too," she said. She misses her first husband but she likes staying at Shanti Daan, she said. After 20 minutes of conversation, she cried:"Mother will be allright, isn't it? .....How can she die, we are all praying," she said. 3043 !GCAT !GPRO The condition of Mother Teresa, in hospital with a weakening heart, has improved slightly, a spokeswoman for the 85-year-old Nobel peace laureate's Missionaries of Charity order said on Sunday. "The doctors say her general condition has improved slightly although she is not out of danger," Sister Priscilla told Reuters. Sister Priscilla gave no further details. Mother Teresa was taken to hospital on Tuesday with a high fever and severe vomiting. She later suffered heart failure before responding to treatment. Earlier on Sunday, a doctor at Woodlands Nursing Home, the hospital where Mother Teresa was being treated, said the missionary's condition had not changed appreciably. Her heart problem was under control but she still needed respiratory support, the doctor said. She had a low-grade fever and was not allowed visitors, he added. 3044 !GCAT !GPOL A two-chamber parliament in Pakistani-ruled Azad (free) Kashmir elected an 81-year-old politician as the state's figurehead president on Sunday amid an opposition boycott. Sardar Muhammad Ibrahim, nominated by a coalition led by Prime Minister Benazir Bhutto's Pakistan People's Party (PPP), was the sole candidate. All 39 members present in the 55-seat house voted for him. The main opposition All Jammu and Kashmir Muslim Conference (AJKMC) party of former state premier Abdul Qayyum Khan has boycotted the state legislature since it lost elections for a 48-seat Legislative Assembly (lower house) on June 30. It also objected to the removal of Ibrahim's predecessor, Sardar Sikandar Hayat, in a no-confidence vote on August 12. Ibrahim assumed the presidency for the fourth time since 1947, when he headed a fledgling administration after Kashmiri Moslems revolted against a Hindu princely ruler, Hari Singh, who later declared the Himalayan region's accession to India. Pakistan, which does not recognise Singh's accession, rules one-third and India the remaining two-thirds of Kashmir. The two countries have fought two of their three wars since their independence from Britain in 1947 over the Himalayan region. Ibrahim was last elected president in a direct vote in 1975, but was removed in 1977 by Pakistan's then military ruler General Mohammad Zia-ul-Haq. The state high court declared his removal illegal 10 years later, but did not reinstate him. Hayat, an AJKMC member, was ousted by 39 votes in a joint sitting of the state Council (upper house) and Legislative Assembly on August 12, but said the procedure had been illegal. The AJKMC accuses the Pakistani government of rigging the June 30 assembly elections. The PPP denies the charge. 3045 !GCAT !GPOL !GVIO Sri Lanka is considering outlawing Tamil Tiger rebels to strengthen its hand against the separatist group as Washington promises to curb rebel activity on U.S. soil, officials and analysts said on Sunday. Political analyst Paikiyasothi Saravanamuttu said banning the Liberation Tigers of Tamil Eelam (LTTE), who are fighting for an independent homeland for minority Tamils in the island's north and east, would close the door to peace talks. "This is talking tough," he said. President Chandrika Kumaratunga summoned a special cabinet meeting to discuss banning the LTTE last week but put off making a decision, government officials said without giving reasons. Political analysts said the government had not outlawed the LTTE because it wanted to leave open the option of resuming talks with the rebels to end the 13-year-old war in which the government says more than 50,000 people have died. The Tigers broke off peace talks in April last year, refusing to look at a government peace plan which offers Tamils extensive autonomy. "Consider also the international impact of the ban," Saravanamuttu said. "It would take care of foreign governments saying they can't take action against the LTTE in their countries because the LTTE is not banned in Sri Lanka." Western governments have told Sri Lanka that they cannot crack down on rebel fund raising and other activities on their soil as long as the LTTE does not break the law and remains a legal organisation in Sri Lanka. The plan to ban the LTTE comes as some Western governments take an increasingly critical view of the rebels. Sri Lanka said on Friday Washington had promised to stamp out illegal activities on U.S. soil directed against Colombo. The foreign ministry said the U.S. State Department's coordinator for counter terrorism, Philip Wilcox, had expressed Washington's support for the government when he held talks with Sri Lankan officials in Colombo last week. "The United States government sympathised with the current predicament Sri Lanka was facing and would do all within its prevailing legal framework to prevent the use of American soil to perpetrate violence against the democratic government of Sri Lanka," Wilcox was quoted as saying. U.S. diplomats confirmed Wilcox's remarks. The U.S. military said earlier this month that it did not intend to get involved in the ethnic war. The Hawaii-based U.S. Pacific Command said in a statement that a recent visit by a U.S. army team to train Sri Lankan soldiers was part of routine cooperation with the Sri Lankan army. Western diplomats said the current lull in the ethnic war meant the army had exhausted itself after a thrust against the rebels' Kilinochchi stronghold in the north last month. The army launched the assault soon after the LTTE overran the northeastern Mullaitivu army camp killing or capturing almost its entire garrison of 1,400 men. "I'm not surprised to see a lull in activity by government forces," said a Western diplomat. "The offensive was hastily planned." Government forces have remained on the outskirts of Kilinochchi for the past two weeks. Aid officials said more than 200,000 Tamils displaced by the offensive were still short of food and had no shelter. 3046 !GCAT !GCRIM Hundred of police raided Dhaka University on Sunday, arresting nearly 20 outsiders who had been living in student dormitories and seizing some weapons, university officials said. Policemen stormed ten residence halls on the campus early on Sunday, flushed out people at gunpoint and searched their baggage. Police seized revolvers, sawn-off rifles, shotguns and knives. The students were later allowed to return. "The raid is still continuing at 1 p.m. (0700 GMT)," one official said but he could not give further details. The swoop followed the resignation of the university's Vice-Chancellor Dr. Emajuddin Ahmed on Saturday over the deteriorating law and order situation on the campus. Authorities closed down the 28,000-student university on Wednedsay following gunbattles between students and police. Police said they fought armed activists from the main opposition Bangladesh Nationalist Party (BNP), headed by former prime minister Begum Khaleda Zia. A spate of student unrest in the northern town of Bogra has left at least four pro-opposition students and one policeman dead in last one week, police and local officials said. Nearly 100 students have been injured in the clashes in Dhaka and Bogra, police told reporters. The BNP blamed the deaths on "gangsters" of the ruling Bangladesh Awami League. The BNP's student front, Jatiyatabadi Chhatra Dal, called for an indefinite protest strike in Bogra from Sunday when Prime Minister Sheiklh Hasina was to visit the town. "The town is already in grip of strike," one local official said over telephone. He declined to give details. 3047 !E12 !E51 !E511 !ECAT !GCAT !GPOL The diverse interests in India's new centre-left coalition government have closed ranks in support of Finance Minister Palaniappan Chidambaram, allowing him a free hand to attract foreign investment, analysts said. Prime Minister H.D. Deve Gowda's 13-party United Front -- a textbook example of rainbow coalition politics -- includes diehard communists and socialists, but they have hardly disturbed Chidambaram's zeal for free-market policies. Chidambaram, who was commerce minister in the government of former prime minister P.V. Narasimha Rao which lost general elections ended in May, is pressing ahead with the economic reforms agenda Rao started in 1991. Amal Ganguli, a partner with consultants Price Waterhouse, said the Foreign Investment Promotion Board (FIPB), which screens all major foreign investments, had opened its arms to overseas firms since Deve Gowda took office on June 1. "It seems it (the FIPB) is anxious to welcome investments," Ganguli said. "We are approving foreign investment proposals faster," N. Mohanty, the Industry Ministry's civil servant in charge of promoting foreign investment, told Reuters last week. Among the numerous proposals the two-month-old government has approved is one by Coca-Cola Co for $700 million. That came despite the coalition's professed goal, pushed by the left wing, of discouraging foreign investment in the consumer goods sector. "Industry Minister Murasoli Maran deserves full support for his creative interpretation of the ruling in the United Front's common minimum programme," the Economic Times daily said in an editorial last week, referring to the coalition's platform. Last week the Power Ministry said some 145 private power projects languishing in the bureaucracy would get "fast-track" treatment. The government has already rolled out a red carpet for investors in key infrastructure areas like roads, telecommunications and ports. Chidambaram is looking for $10 billion every year in foreign direct investment, up from $1.98 billion in the 1995/96 fiscal year ended last March 31. It wants to increase India's share of world trade to one percent in 2000 from 0.64 percent last year. "Their (foreign investment) real surge is yet to come," central bank governor C. Rangarajan said last week, adding that India should aim for sustained 15 percent growth in inflows from exports and tourism. Some holy cows remain on the road to liberalisation. They include insurance, a sector in which trade unions are well organised, and the media, where a powerful domestic lobby and politicians fearing cultural invasion are blocking foreign investors. "Unfortunately the government is a bit confused. If insurance had been opened up, it would have been something good," Ganguli said. The government is reluctant to slash fertiliser subsidies, which peasant leader Deve Gowda believes helps poor farmers. Ganguli said corruption cases linked to the privatisation of telephone services and prolonged re-negotiations for a concluded power project deal involving Enron Corp of the United States could dissuade some foreign investors. But the government has already shown its liberal stripes, analysts say. "The fact this is a coalition and yet pro-business is very welcome," Ganguli said. 3048 !GCAT !GPRO !GREL Mother Teresa's condition showed no appreciable change on Sunday, but doctors treating the Nobel Peace Laureate said anything could happen given her age. Mother Teresa's heart problem was under control, said Dr S. K. Sen, the medical director of the Woodlands Nursing Home, where the 85-year-old nun was admitted on Tuesday with malarial fever and severe vomiting. "Mother Teresa's condition shows no appreciable change," Sen told reporters. "Her cardiac irregularity is under control but she still needs respiratory support. She still has a low-grade fever." Asked how long Mother Teresa would be on the respirator, Sen said: "It might take days. At this age, anything could happen." Though Mother Teresa was conscious, she had not spoken to anyone, Sen said. Her doctors had forbidden visitors. The Albanian-born Catholic nun has become known as the Saint of the Gutters for devoting her life to helping the sick, the poor and the destitute. 3049 !GCAT !GDIS !GREL Indian army and paramilitary forces battled on Sunday to rescue thousands of Hindu pilgrims stranded along a rugged Himalayan mountain path after at least 116 died from cold, officials said. The troops were close to 70,000 devotees strung along the 50-km (30-mile) route to the holy Amarnath cave, officials said. The cave is 3,880 metres (12,725 ft) high. "At least 116 yatris (pilgrims) have died so far," spokesman K.B. Jandial told Reuters. "Now there is no one left at the cave. The army helped to guide the pilgrims down to safety." Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu god Shiva. There were many naked "sadhus", or Hindu holy men smeared only in ash, among the dead, relief officials said. "The main reason for the deaths is that the pilgrims had no warm clothing. Many were were old people. The holy men were trekking naked," said a doctor at a pilgrim camp in Anantnag, 50 km (30 miles) south of Srinagar. The taxing trek across India's only-Moslem majority state had to be halted soon after unexpected heavy rain and snow falls last week. It had been scheduled to end this Wednesday. Indian troops based at Pahalgam, the base camp for the trek, had swung into action to guide pilgrims off the slopes and carry the ill and injured to safety, an army spokesman said. "We have moved almost 30,000 people out of the vicinity of the cave, removing them from the highest sector of the trek since yesterday," the spokesman told Reuters in New Delhi. The army has made arrangements to distribute food and fuel to the trekkers. It has also set up eight medical camps. Officials said prospects for a successful, full-scale relief operation had brightened with an improvement in the weather which had hampered rescue work on Saturday. "Today we will fly helicopter sorties and try to airlift ill and injured pilgrims from Sheshnag, Panchtarni and other places," a defence official in Srinagar said. Both points are more than 3,000 metres (9,840 ft) high, about a day's trek from the holy cave. Heavy rains had stranded the 30,000 trekkers who managed to struggle back to the base camp at Pahalgam, officials said. Approach roads in and out of the town were all flooded. Moslem villagers have also come forward to help the stranded pilgrims. They had taken them into their homes and given them food and warm clothing, officials said. In Jammu to the south, teams of paramilitary forces were busy clearing the 300-km (200-mile) highway to Srinagar, an operation which is expected to take another day or two. About 25,000 people had been stranded in Jammu, the state's winter capital, after floods and landslides caused by torrential rains blocked the highway, officials said. Last year the pilgrimage was threatened by Moslem separatist guerrillas who staged two bomb attacks on the heavily guarded pilgrims. A state civil servant was killed in one of the blasts. Some 20,000 people have died since a separatist revolt broke out in 1990 in Jammu and Kashmir, police and hospital sources say. This year guerrillas issued no ban on the pilgrimage. 3050 !GCAT !GPRO Mother Teresa's condition remained grave on Sunday, with her heart unstable as she remained on a respirator in a Calcutta hospital, an official said. "It (her condition) hasn't changed, she hasn't improved," the official at the Woodlands Nursing Home told Reuters. The 85-year-old Nobel peace laureate's heartbeat was still irregular, but she was conscious. The official refused to elaborate, saying Mother Teresa's doctors would announce the next health bulletin at 1130 hours (0600 GMT). Dr S.K. Sen, medical director of Woodlands, said late on Saturday that the Roman Catholic nun had suffered a brief heart failure which was "adequately treated". Specialist physicians are attending her round the clock. Known as the Saint of the Gutters for her devotion to the poor and homeless, Mother Teresa has been in hospital since Tuesday when she was admitted with high fever and vomiting. 3051 !GCAT !GDIS !GREL Some 116 pilgrims have died from exposure in the Himalayan mountains along a rugged route to a 3,880-metre (12,725-ft) high cave, officials said on Sunday. Nearly 70,000 pilgrims were stranded by heavy rain and snow and authorities in Kashmir have suspended the annual Hindu pilgrimage, a spokesman for Jammu and Kashmir state said. The trek through India's only Moslem majority state began last week. It had been scheduled to end on Wednesday. "At least 116 yatris (pilgrims) have died so far," spokesman K.B. Jandial told Reuters. "Now there is no one left at the cave." The winds and rain lashing the exposed 50-km (30-mile) route had dropped during the night, the spokesman said. "We may be able to step up rescue operations today," he said. Officials said some 112,000 Hindus had arrived in Kashmir this year to visit the Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu god Shiva. 3052 !GCAT !GVIO Thousands of Tamils demonstrated outside the United Nations' European headquarters in Geneva on Monday to appeal for U.N. recognition of their fight for independence from Sri Lanka. The demonstrators, said by police to number 6,000, also urged the release of Nadarajah Muralidaran, Swiss-based leader of the the Tamil Tiger guerrillas, who has been held in a Zurich jail since April on charges of extortion. The demonstrators delivered an appeal to the U.N. human rights centre demanding an immediate end to "state terrorism" against Tamils and the Liberation Tigers of Tamil Eelam (LTTE). 3053 !E11 !ECAT !GCAT !GPOL The French are returning from their holidays in a depressed mood, disappointed by economic weakness and continued budget austerity which could lead to a difficult autumn for the government. According to a poll published in the Le Parisien newspaper on Monday, 54 percent of the French are pessimistic about "La Rentree" - the big return to work, school and politics. Strikes, poverty and job losses topped voters' worries, the CSA survey of 1,005 people showed. The poll also found that 78 percent of those polled expected troubles for the centre-right government when the summer holidays end. Of the people surveyed, 52 percent feared strikes and social unrest the most. Unions have vowed to challenge plans to cut spending by around 60 billion francs in real terms next year in a budget due to be unveiled in September. Around 7,000 civil service jobs face the axe as part of government initiatives to close the gap between spending and revenues and qualify for a European single currency from 1999. President Jacques Chirac on Sunday said he did not know whether there would be unrest after the summer break as threatened by unions, who say conditions are right to revive unrest to match a crippling 24-day wave of strikes in late 1995. But financial markets are uncertain and the franc, bonds and shares remain fragile due to worries about the reaction to France's 1997 austerity budget, due to be unveiled in September. Communist Party leader Robert Hue warned on Monday the spirit of last year's strikes, which brought France to a virtual standstill, was "still alive in hearts and minds". Economists are sceptical the budget -- marrying spending restraint with tax cuts -- will be enough to reach government's goal of a budget deficit of three percent of gross domestic product (GDP), needed to qualify for European monetary union. "Deficit-busting has the highest government priority but still more needs to be done," Smith Barney economists Paul Horne and Steven Englander said in a note to investors on Monday. A series of key dates starts on Tuesday with a meeting of the main teachers' unions. Some teachers' unions have already announced strikes over perceived government plans to cut 2,300 posts in education. On Wednesday the government has its first cabinet meeting after the summer break and a ministerial seminar on the budget. Louis Viannet, head of the Communist-led CGT union will hold a news conference the same day in which he is expected to warn the government against any attacks on the welfare system. On Friday August 30, the July unemployment figures are due. Unemployment, at record levels, remains a major thorn in the side of the government. But the level is not expected to fall any time soon. Juppe said on Sunday that around September 10 he would present both the 1997 budget and the social security financing plan as well as plans for a tax reform. As soon as September 11, the government could present the cabinet with the 1997 budget. Activists have planned protest meetings and news conferences to follow hard on the heels of the budget presentation. 3054 !E21 !E212 !E51 !E512 !ECAT !GCAT !GDIP !GENV Japanese Prime Minister Ryutaro Hashimoto met Brazil's President Fernando Henrique Cardoso on Monday, bearing gifts in the form of $510 million for environmental projects, officials said. On a 10-day Latin American tour intended to show Japanese firms the region was again ripe for investment after the "Lost Decade" of the debt crises and 1980s hyperinflation, Hashimoto had been expected to focus on bilateral issues with Cardoso. Hashimoto's spokesman said on Sunday that multilateral issues, such as reform of the United Nations and progress on a Comprehensive Nuclear Test Ban Treaty, might also be raised. After their 1-1/2 hour talks on Monday, Cardoso and Hashimoto were to preside over the signing of $510 million in Japanese Overseas Economic Cooperation Fund (OECF) financing for four environmental projects in Brazil. They included programmes in the states of Parana and Santa Catarina, a project to clean the Bay of All Saints in Salvador in Brazil's northeast and a wind-powered energy project in the northern state of Ceara. Vera Machado, head of the Brazilian Foreign Ministry's Asia and Oceania Department, said Tokyo had also broached the possibility of financing small-scale community projects and the Brazilian government was considering its response. After lunch in Brasilia's futuristic Foreign Ministry, Hashimoto was to meet representatives of Brazil's 1.3 million-strong Japanese community, the largest outside Japan. On Sunday, he mingled with Japanese immigrants in Brazil's sprawling industrial heartland of Sao Paulo. For Brazilian officials, the first visit by a Japanese prime minister in almost 15 years reflected renewed confidence in Latin America's largest economy. Hashimoto's spokesman said it also reflected renewed faith in Brazil being able and willing to play an expanded role on the world stage. Hashimoto was also expected to touch on relations between Tokyo and the four-nation Mercosur customs union, of which Brazil is the powerhouse. "There is always the possibility that Mercosur could take steps that would be damaging to Japanese trade, though we think and hope not. But we believe it's worth reminding them that this should not be the case," his spokesman said. Among other issues, Japan was hoping to convince Brazil to lift a ban on Japanese fishing vessels entering Brazilian ports. The ban dates back to 1992 when Japanese and Spanish fishing vessels were caught trawling in Brazilian waters. Hashimoto's tour has already taken him to Mexico and Chile. He was to depart Brasilia for Lima on Monday afternoon. 3055 !C13 !C17 !CCAT !G15 !G152 !G157 !GCAT Battle lines hardened on Monday in the dispute betweeen Germany and the European Union over subsidies by the state of Saxony for auto maker Volkswagen AG. Germany and the EU each threatened to file fresh complaints in the case with the European Court of Justice in Luxembourg, after Saxony did so on Friday. The tussle began in June when the European Commission approved only 540 million marks ($365.5 million) of a proposed 780 million marks in subsidies for VW to build two plants in the formerly communist east German state. Saxony premier Kurt Biedenkopf decided to hand over all the money anyway, because he said 23,000 jobs depended on it. German economics minister Guenter Rexrodt said Bonn backed Volkswagen's claim to all the cash, despite Brussels' contention this could start a spiralling war of subsidies. "I believe VW has a right to this money, and that the two plants must be built in Mosel and Chemnitz," Rexrodt told German television. Initially, Rexrodt was less than pleased at Biedenkopf's action and had urged him to reach a compromise with Brussels, but he now appears to be digging in for a standoff. Compromise "will be difficult, but nothing should be left untried. We need Brussels, Brussels needs us," he said. Rexrodt said he would recommend to the cabinet on Tuesday that Germany file a complaint in Luxembourg to clarify what role Brussels should play in monitoring Bonn's support for the rebuilding of the east, which still depends on massive help six years after unification. In Brussels, a spokesman told reporters the commission planned no immediate action but would discuss the VW row at its September 4 meeting, and would prepare to launch its own action in Luxembourg if the matter was not fixed to its liking. "If legality is not re-established we are preparing everything so that if necessary the complaint on our side will be launched," he said. Rexrodt and EU Competition Commissioner Karel Van Miert failed to resolve differences in a meeting last Friday, the day Saxony filed its complaint. Biedenkopf on Monday defended the decision to go to court. "Putting a European Commission decision to the test in court is not the same as putting Europe in question," Biedenkopf told a gathering of VW managers. He said the Commission was not a government but a bureaucratic body. The relationship between Saxony and VW was one of cooperation, not blackmail as Van Miert suggested last week, he said, adding that Saxony was convinced the subsidies for VW were legal. Saxony was one of the most industrialised regions in Germany before World War Two, and suffered greatly under the communist east German government. Unemployment there is now over 15 percent. 3056 !GCAT !GCRIM !GVIO A South Korean court sentenced former president Chun Doo Hwan to death on Monday on charges relating to a 1979 coup that thrust him to power. His presidential successor, Roh Tae-woo, was sentenced to 22-1/2 years in prison on similar charges of masterminding the putsch and attempted murder of superior officers. At the time both men were army generals. However, Chun was cleared of a separate charge of murder in connection with an army massacre in 1980 of pro-democracy protesters in the southern city of Kwangju. Both were found guilty of taking bribes. Chun was fined 225.9 billion won ($276 million) and Roh 283.8 billion won, equal to the amount they were convicted of pocketing. Chun and Roh are expected to appeal the sentences handed down by a three-judge panel at the Seoul District Criminal Court after what was dubbed the "trial of the century". Many Koreans are convinced current President Kim Young-sam, whose campaign to "right the wrongs of history" prompted the legal action, will offer a pardon. The two have remained defiant, defending the coup as needed to prevent turmoil following the assassination of president Park Chung-hee. The court also passed judgment on 14 former military cronies of Chun and Roh. One was cleared of charges relating to Chun's grab for power while the other 13 were sentenced to jail terms of four to 10 years. Later on Monday nine business tycoons and nine former officials will be sentenced on bribery charges. Among the moguls are the chairmen of the mighty Samsung and Daewoo groups. After the sentencing, women relatives of the Kwangju victims attacked Roh's son, Jae-hun, as he left the court and shouted "Kill the murderer's son". Earlier, the women dressed in white mourning garb cheered when news of the death sentence reached them. Some burst into tears when they heard Roh had escaped capital punishment. "Hand over all the slaughterers to us and we will finish them off, as they killed our children," sobbed one old woman. Chun and Roh, former military academy classmates, arrived in court dressed in pale blue prison pyjamas. They briefly squeezed hands as they took their places in the defendants' box. Their administrations spanned 13 years from 1980-1993 during which South Korea traversed a path to democracy and built a world-class economy. Roh's refusal to be rubber-stamped in office by Chun led to popular elections for the presidency in 1987. In a Korean society where "face" is everything, their downfall has been spectacular. Part of a ruling elite of tough officers who emerged from the barracks to orchestrate the country's military-style economic charge, they are now despised. Enraged Koreans heard evidence that sackloads of cash were delivered to the presidential Blue House by tycoons. The trial is being closely watched by other young Asian democracies struggling to lay to rest the ghosts of past military excesses. Chun gained a measure of respect for his rigid defiance of court proceedings. A protest hunger strike in his detention cell brought him to the brink of death. But the public's thirst for vengeance waned as evidence mounted that not just the star defendants, but virtually every leading politician and tycoon, were tainted by corruption. Visceral anger against Chun and Roh is confined mainly to Kwangju and surrounding South Cholla province, kept alive by the enduring backwardness of the opposition stronghold. The two ex-presidents still enjoy widespread support in their home provinces, a factor president Kim must weigh as he seeks support for a candidate of his choice to contest presidential elections next year. (Conversion $1 = 818 won) 3057 !GCAT !GDIP !GPOL Israeli Prime Minister Benjamin Netanyahu said on Monday he expected progress in the stalled peace process with the Palestinians "in the coming weeks". Foreign Minister David Levy suggested Netanyahu should meet Palestinian President Yasser Arafat "soon". Netanyahu was speaking after meeting visiting Japanese Foreign Minister Yukihiko Ikeda, who urged Israel's right-wing government to revive Middle East peacemaking, dangling the prospect of closer economic ties with Tokyo as a reward. "We reiterated our commitment to pursue peace, both on the Palestinian track -- in which I expect progress in the coming weeks -- and on the Syrian track, in which we reissued our invitation to Syria to resume the talks," Netanyahu told a joint news conference. "I was...left with the impression that there will be concrete progress made in the context of the Palestinian track soon," Ikeda said. Neither man specified the nature of possible movement in Israeli-PLO talks, expected to resume early next month. Asked by Israel's Channel One television if thought a Netanyahu-Arafat meeting needed to be held soon, Levy said: "Certainly there is a need. What else? Did someone think that I, as foreign minister, a member of this government, went to meet Arafat as a one-time thing, or a personal matter, or without the prime minister's knowledge?" In recent days several figures in Netanyahu's Likud party have pressed the premier to make a decision over a personal meeting with Arafat, viewed by rightists as a "terrorist". Levy is the only member of Netanyahu's religious right coalition government to have met Arafat since Netanyahu defeated Nobel Peace Prize laureate Shimon Peres in May elections, Later on Monday a Japanese delegation headed by Foreign Ministry Director General Seii Chiro Noboro met Palestinian officials at PLO East Jerusalem headquarters at Orient House. Successive Israeli governments have opposed such visits, viewing Orient House as the spearhead of Arab efforts to establish sovereignty in East Jerusalem, claimed by both Israel and the Palestinians. But Netanyahu has taken a tougher line on Palestinian activities in Jerusalem than the government he ousted, which turned a blind eye to PLO offices in the eastern half of the city it captured in the 1967 Middle East war and later annexed. Palestinians view East Jerusalem as the capital of a future state. The city's fate is up for negotiation at final peace talks which have yet to resume under Netanyahu. Palestinians are closely watching Netanyahu for signs he will give green lights to a long-delayed army pullback from the still-occupied West Bank flashpoint of Hebron, and to a face-to-face meeting with Palestinian President Yasser Arafat. Netanyahu, noting that Japan is Israel's second biggest trading partner, said he expected a substantial increase in trade and joint ventures between the two nations. Japan is the main donor nation aiding Arafat's Palestinian Authority and a participant in multilateral Middle East talks. On Sunday in self-ruled Gaza, Ikeda said he had invited Arafat to visit Japan from September 10 to 13. 3058 !E21 !E212 !E51 !E512 !ECAT !GCAT !GDIP !GENV Japanese Prime Minister Ryutaro Hashimoto met Brazil's President Fernando Henrique Cardoso on Monday, bearing gifts in the form of $529 million for environmental projects, officials said. On a 10-day Latin American tour intended to show Japanese firms the region was again ripe for investment after the "Lost Decade" of the 1980s debt crises and hyperinflation, Hashimoto focused on bilateral issues in talks with Cardoso. The two leaders also found time to discuss reform of the United Nations and global environmental issues and agreed to push for a Comprehensive Test Ban Treaty at the next U.N. session, the Japanese premier's spokesman told reporters. But trade topped the agenda. Hashimoto expressed Tokyo's desire for Brazil to ensure its car import rules, which favour manufacturers with Brazilian factories, conformed with World Trade Organisation rules. Brazil's recent decision to set quotas for low-tariff car imports was a "first step towards improving market access," but Japan would press on with WTO consultations over the rules themselves, the spokesman said. "If a member of the WTO takes measures against its rules, then the WTO itself is challenged. Brazil is a responsible member of the WTO and has got to abide by its rules," he said. After 1-1/2 hours of talks, Cardoso and Hashimoto presided over the signing of $529 million in Japanese Overseas Economic Cooperation Fund (OECF) financing for four environmental projects in Brazil. They included programmes in the states of Parana and Santa Catarina, a project to clean the Bay of All Saints in Salvador in Brazil's northeast and a wind-powered energy project in the northern state of Ceara. After lunch in Brasilia's futuristic Foreign Ministry building, Hashimoto met representatives of Brazil's 1.3 million-strong Japanese community, the largest outside Japan. For Brazilian officials, the first visit by a Japanese prime minister in almost 15 years reflected renewed confidence in Latin America's largest economy. "It is politically eloquent that (you) have come to Brazil less than six months after my visit to Japan," Cardoso said at the luncheon. "Watching closely our relations, your excellency knows that Brazil has changed, and for the better." Hashimoto also broached ties between Tokyo and the four-nation Mercosur customs union, of which Brazil is the powerhouse, and voiced his concern at "economic regionalism." He proposed holding a high-level meeting in October to discuss ties, expressing Tokyo's desire that the bloc should not cut itself off from the outside world. Hashimoto's tour has already taken him to Mexico and Chile. He was due next in Peru where he will meet President Alberto Fujimori, himself the son of Japanese immigrants, on Tuesday. Fujimori rose from obscurity to defeat world renowned novelist Mario Vargas Llosa in 1990 presidential elections. Hashimoto will also visit members of the 100,000-strong Japanese community founded in Peru in 1899 by immigrants who came to work on sugar plantations. He was expected to announce in Peru an economic aid and cooperation package worth several hundred million dollars. Japan has been a key ally since Fujimori's election, pumping an estimated $900 million into a country where at least half of the 24 million inhabitants live in poverty. 3059 !E51 !E512 !ECAT !GCAT !GDIP A Yugoslav trade mission on Monday completed the first such visit to Sarajevo since the Bosnian war broke out in 1992. The Yugoslava mission, headed by Yugoslav Deputy Prime Minister Nikola Sainovic, was returning a similar one-day visit to Belgrade by Bosnian trade delegation on July 23. Sainovic said on departure from the Bosnian capital that "numerous forms of economic cooperation had been agreed with the government in Sarajevo". Among them, he was quoted by the Yugoslav news agency Tanjung as saying, was a decision for the Yugoslav airline JAT to begin a service to Sarajevo next week. Sarajevo aiport opened for civilian traffic earlier this month after being closed to all but military and relief flights for four years. Bosnian Prime Minister Hasan Muratovic, who met the trade delegation, said discussions had focused on setting up a "more intensive economic relationship". "We agreed concretely for experts to meet in the shortest possible time to define a (common) payment system and to define border crossings and procedures," Muratovic told reporters. Sainovic said his delegation's meetings with Bosnian government officials and private businessmen had furthered the cause of the Dayton peace agreement, which ended the 43-month Bosnian war last December. "Economic development needs to be the long-lasting cement of the peace agreement," Sainovic said. Bosnian Vice-President Ejup Ganic, who led the Bosnian trade mission to Belgrade in July, said Monday's talks represented a continuation of what began in the Yugoslav capital last month. "The main issue of today's talks was trade in order to create a new urgency for resolving other problems," Ganic said. Bosnian President Alija Izetbegovic met Sainovic, Bosnian radio reported. Yugoslavia lost four of its six republics in recent years as Slovenia, Croatia, Bosnia and Macedonia gained independence. Croatia and Bosnia fought protracted wars, in part against the republics of Serbia and Montenegro which remained behind and formed rump Yugoslavia. Yugoslavia and Croatia signed a mutual recognition accord on Friday, ending five years of hostility between them. Yugoslavia and Bosnia have not yet recognised one another, but the exchange of trade delegations is viewed by diplomats as a practical step in that direction and another sign that stability is returning to the Balkans. "We of course welcome this visit," U.S. Ambassador to Bosnia John Menzies said of the Yugoslav trip to Sarajevo. "We thought it was a major breakthrough when Mr. Ganic visited Belgrade. We are very glad to see the return visit." 3060 !E12 !E21 !E211 !ECAT !GCAT !GPOL Germany's opposition Social Democrats (SPD) on Monday rejected a large chunk of Bonn's austerity package in a meeting of an arbitration committee of both houses of parliament. But the government said it could, and would, override almost all the rejections next month in the lower house of parliament, using its so-called "Chancellor Majority." It said it was determined to implement its austerity package as soon as possible and accused the SPD of cheap delaying tactics. The SPD had signalled it would use its majority in the committee to reject proposed reductions in sick pay and workers' protection from firing and a raise in the pensionable age of women even though its objections could be overriden. SPD parliamentary whip Peter Struck said he hoped the government would not be able to get a majority in the lower house on September 13 because some of its own members were opposed to some of the austerity measures. Heribert Blens, chairman of the arbitration committee and a member of Chancellor Helmut Kohl's Christian Democrats (CDU), said there was no danger of this happening. In the run-up to the meeting, the government and SPD had disagreed over the austerity package. CDU General Secretary Peter Hintze said: "(SPD leader) Oskar Lafontaine should use his energies not in these delaying tactics but should work constructively with us." Kohl unveiled the austerity plan in April. He aims to slash public spending by 50 billion marks ($33.84 billion) and social security spending by 20 billion next year to ensure Germany meets the entry requirements for the single European currency. Of the 70 billion marks, well over half has been agreed on including the parts Bonn is currently pushing through despite SPD protest. Around 15 billion marks alone was saved through a moderate public sector wage deal. While the SPD-dominated upper house of parliament, or Bundesrat, must be consulted on much of the package, it can only in reality block the parts related to tax and welfare changes which affect federal states' budgets directly. SPD chief Lafontaine said just before the meeting: "We are against attacks on sick pay, on workers' protection from firing and on pensions." "We have the support of a majority of the population in this. The austerity package is an affront to employees and damages social cohesiveness," he said. He said the SPD would ensure a rise in child benefit would go ahead as planned in 1997. Kohl's government hopes to save three billion marks by delaying the hike by a year but the move requires upper house approval. The arbitration committee rejected the delay and one side or the other will now have to call the committee again in about a month's time. This coincides with the start of haggling over the 1997 tax bill which also requires upper house approval and where the SPD is determined to make a last stand against the austerity plans. The lower house of parliament, or Bundestag, will hold a special session this Thursday where it will reject the conclusions of the arbitration committee, Blens said. 3061 !C12 !C15 !C152 !CCAT !GCAT !GCRIM Tobacco stocks rallied Monday after an Indiana jury sided with tobacco companies on Friday in a case filed by the widow of a smoker who died of lung cancer. The stocks have taken a beating since early August after a jury in Florida found Brown & Williamson Tobacco Corp. liable for $750,000 in a separate case filed by the family of a smoker who had lung cancer. That verdict -- only the second time a jury had ever awarded damages against a cigarette maker -- sent shudders through the industry and across Wall Street. "This is a small victory for tobacco stocks," Peter Cardillo, research director at Westfalia Investments, said of the Indiana ruling. "The market is going to have a positive reaction." Shares of Philip Morris Cos. Inc., the world's largest cigarette maker, rose $2.875 to $90.875, RJR Nabisco, owner of R.J. Reynolds Tobacco, added $1.125 to $26.625, and Loews Corp., parent of Lorillard Tobacco, jumped $1.75 to $76.50, all on the New York Stock Exchange. UST, owner of United States Tobacco, the nation's biggest smokeless tobacco maker, added 37.5 cents to $31, also on the NYSE. While the victory in the Indiana case was welcomed by the industry, legal experts said the case was a tiny skirmish in a full-blown war. President Clinton on Friday announced strict new rules to control tobacco sales and advertising -- including requiring proof of age to buy cigarettes. Fourteen states as well as San Francisco and Los Angeles have sued the industry to recoup health care costs of smokers. In the Indiana case, a jury found for R.J. Reynolds Tobacco Co., Philip Morris, The American Tobacco Co., now owned by Brown & Williamson, and Liggett Group Inc., the smallest of the nation's major tobacco companies. The suit had been filed by the family of Richard Rogers, an Indianapolis lawyer who died aged 52 in 1987. They sought unspecified damages, contending that the tobacco industry peddled an addictive product that caused Rogers' cancer. Lawyers for the Rogers family said during the trial that he knew he was addicted and tried to quit, but the industry, by selling an addictive product, took that choice away from him. Tobacco industry lawyers countered that Rogers for at least 20 years was exposed to warning labels on cigarette packs and should have been fully aware of the risks. Tobacco stocks had fallen as much as 20 percent since the Aug. 9 verdict in the Florida case. Experts said there was a major difference between the Florida and Indiana cases: the Jacksonville, Fla., jury had seen inflammatory internal tobacco documents relating to the industry's knowledge of nicotine and addiction while the Indianapolis jury had not. 3062 !E51 !E512 !ECAT !GCAT !GDIP A Yugoslav trade mission wrapped up a one-day visit to Sarajevo on Monday, the first such trip to Bosnia's capital since war broke out here in 1992. Headed by Yugoslav Deputy Prime Minister Nikola Sainovic, the Yugoslav mission reciprocated a July 23 Bosnian trade delegation visit to Belgrade. Bosnian central government Prime Minister Hasan Muratovic, who met the trade delegation, said discussions had focused on setting up a "more intensive economic relationship". "We agreed concretely for experts to meet in the shortest possible time to define a (common) payment system and to define border crossings and procedures," Muratovic told reporters. Sainovic said his delegation's meetings with Bosnian government officials and private businessmen had furthered the cause of the Dayton peace agreement, which ended the 43-month Bosnian war in December of 1995. "Economic development needs to be the long-lasting cement of the peace agreement," the Yugoslav Deputy Prime Minister said. Bosnian Vice-President Ejup Ganic, who led the Bosnian trade mission to Belgrade in July, said Monday's talks were a continuation of what began in the Yugoslav capital last month. "The main issue of today's talks was trade in order to create a new urgency for resolving other problems," Ganic explained. Bosnian President Alija Izetbegovic met Sainovic, Bosnian radio reported. Yugoslavia lost four of its six republics in recent years as Slovenia, Croatia, Bosnia and Macedonia gained independence. Croatia and Bosnia fought protracted wars, in part against the republics of Serbia and Montenegro which remained behind and formed rump Yugoslavia. Yugoslavia and Croatia signed a mutual recognition accord on Friday, ending five years of hostility between those two countries. Yugoslavia and Bosnia have not yet recognized one another, but the exchange of trade delegations is viewed by diplomats as a practical step in that direction and a further sign that stability is returning to the Balkans. "We of course welcome this visit," U.S. Ambassador to Bosnia John Menzies said of the Yugoslav trip to Sarajevo. "We thought it was a major breakthrough when Mr. Ganic visited Belgrade. We are very glad to see the return visit." 3063 !C18 !C181 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The Teamsters union said Monday it has endorsed HFS Inc's purchase of Avis after securing agreements from Avis that all existing Teamster contracts will be honored by HFS. The union said Avis also offered assurances that no Teamster members will have to reapply for their jobs with HFS. HFS Inc signed a definitive agreement on Friday to buy Avis for about $800 million. It plans to sign a contract soon with General Motors Corp to acquire its stock of Avis. Teamsters and other Avis employees own 71 percent of the company through its employee stock option plan. 3064 !C21 !C23 !CCAT !GCAT !GHEA A single dose of a drug that uses monoclonal antibodies to prevent blood clots dramatically reduces deaths from heart attack after surgery to stretch open clogged arteries, doctors told a conference on Monday. Researchers at Duke University in Durham, North Carolina and Erasmus University in Rotterdam, Netherlands said the drug abciximab, known commercially as ReoPro, cut the need for additional surgery after angioplasty. Angioplasty is currently a popular treatment for patients with heart disease. It opens the arteries and restores blood flow without the need for risky bypass surgery. Angioplasty involves opening a clogged blood vessel with a tiny balloon. But the procedure can knock loose plaque build-up from inside the artery. ReoPro uses a new technology involving monoclonal antibodies -- proteins that can find and attach to specific cell targets -- to stop platelets in the blood from sticking together. The drug homes in on receptors on the cells that help them stick together. It blocks them so the cells cannot clump. The doctors described two trials involving a total of nearly 5,000 patients in the United States and Canada and a third trial involving 1,200 patients in the Netherlands. All three found that ReoPro greatly reduced complications from the surgery. The patients had also all been given standard drugs against blood clots such as aspirin and heparin. The trials were stopped last December when the strong effects of ReoPro became apparent. They showed a 60 percent reduction in deaths among patients who had suffered from acute heart attacks or angina (chest pain) when they had angioplasty. "One month after treatment, overall death, recurrent heart attacks and urgent repeat angioplasty or bypass surgery were reduced by up to 59 percent in all patients who were treated with...ReoPro," Duke University said in a statement. Dr Eric Topol, who helped coordinate the study, said the effects of just one dose of the drug were apparent three years later. "There was a more than 50 percent reduction in death after three years in acute cases," he told a news conference. Interim findings from the studies have been published in the New England Journal of Medicine and the Lancet medical journal, but the final results were being presented for the first time to 16,000 delegates at the European Society of Cardiology meeting in Birmingham. ReoPro, manufactured by Centocor Inc of Malvern, Pennsylvania, is marketed by Eli Lilly and Co. It is licenced across North America and most of Europe. One drawback to the drug is its cost. A single dose costs $1,350 in the United States. But Dr Robert Califf, director of Duke's Clinical Research Institute, said he thought the expense was worthwhile. "Obviously if you prevent these bad events (such as) heart attacks...from happening you save money on hospital care," he said. 3065 !E12 !ECAT !GCAT !GVIO Jordan announced measures to boost private investment in the economy and create jobs in the wake of bread riots, officials and businessmen said on Monday. Prime Minister Abdul Karim al-Kabariti told them late on Sunday the government's commitment to free market reforms was unaffected by riots that followed the doubling of bread prices, the worst unrest in Jordan since 1989. Kabariti pledged a two-pronged policy of encouraging private sector investment while strengthening a safety net to protect Jordan's poor, the majority of its 4.2 million people, during the transition period. Businessmen welcomed the package they believe meets long-standing demands, adding it showed the government's resolve to go ahead despite the political cost shown by the riots. Some remain sceptical the government will be able to proceed quickly to trim red tape and a stifling bureaucracy they blame for deterring private investment, seen as the real solution to Jordan's economic woes. Kabariti said the government had drafted key laws to boost export industries and attract foreign investment to create jobs. Unemployment and poverty were widely blamed for the bread riots this month. Jordanian officials say unemployment is 15 percent of a 900,000 labour force but economists believe it is at least 25 percent. "The economic package will include improving the investment climate by new economic legislation and amending existing laws ...and proceeding with privatisation," Kabariti said. He also announced the ending in September of tariffs on 492 items to boost industrial investment, and an end to inspection of certain imports for industry to cut red tape under a new customs law. Kabariti promised several new laws: a companies law that would ease taxation on companies raising capital, a securities law for the stock market, a law to prohibit dumping of imports by foreign countries, a law against monopolies and a law to create mutual funds to channel small savings. Kabariti defended the decision to double bread prices but acknowledged policies during a transition period may cause social upheaval. "We do not deny that we are passing through a difficult transitionary phase on the economic and social level and the battle is intensifying at the cross-roads," Kabariti said. But he vowed not to backtrack on reforms that harmed "vested interests and marginal producers" cushioned by what he termed structural distortions that harm ordinary citizens. The IMF-sanctioned plan to remove bread subsidies was needed before implementation of broader free market reforms which have been delayed by successive governments since Jordan embarked on monetary stabilisation reforms after a severe economic crisis in 1989. Officials say the World Bank and the IMF have pledged support to expand a safety net for Jordan's poor during the reforms to prevent social upheaval. Kabariti said the government would spend more to develop infrastructure in poor areas of the kingdom, enhance vocational training for unemployed youths and extend credit to small businesses. 3066 !C41 !CCAT !GCAT !GCRIM !GPOL !GPRO A South Korean court sentenced former president Chun Doo Hwan to death on Monday on charges of masterminding a 1979 coup and an army massacre of pro-democracy demonstrators the following year. His presidential successor, Roh Tae-woo, was sentenced to 22-1/2 years in prison for playing a supporting role. Both men were also convicted of massive corruption. Separately, nine business tycoons -- including the chairmen of the Samsung and Daewoo groups -- were sentenced for giving bribes to Roh. All were given jail terms but the sentence on Samsung's chairman was suspended, meaning he does not have to go to prison. A total of 13 former military colleagues of Chun and Roh were handed jail sentences of four to 10 years. Another was cleared of all charges. Nine one-time aides, cabinet ministers, bodyguards and other administration officials received jail terms on various charges of bribery, including acting as bagmen for their presidential bosses. The army massacre in the southern city of Kwangju killed about 200 civilians by official count and crushed democratic opposition to Chun's martial law rule. Chun and Roh, army generals during the putsch which thrust Chun to power, are expected to appeal the sentences handed down by the Seoul District Criminal Court after what was dubbed South Korea's "trial of the century". Many Koreans are convinced current President Kim Young-sam, whose campaign to "right the wrongs of history" prompted the legal action, will offer them pardons. Yonhap news agency quoted presidential aides as saying it would be absurd to comment on the possibility of amnesty before the cases were reviewed by higher courts. After the sentencing of the former heads of state, women relatives of the Kwangju victims attacked Roh's son, Jae-hun, as he left the court and shouted "Kill the murderer's son". Earlier the women, dressed in white mourning garb, cheered news of the death sentence. Some burst into tears when they heard Roh had escaped capital punishment. The three-judge panel said Roh was spared the death sentence in recognition of his role in gaining South Korea entry into the United Nations in 1991 and other diplomatic achievements. Chun was fined 225.9 billion won ($276 million) and Roh 283.8 billion won, equal to the amount they were convicted of illegally pocketing. Chun's rise to power came "through illegal means which inflicted enormous damage on the people", according to the judges' verdict. Referring to the massacre, they accused the defendants of "putting down popular resistance to clear the way for their rise to power". Chun and Roh remained defiant throughout the trial, defending the coup as necessary to prevent turmoil following the assassination of President Park Chung-hee. Samsung chairman Lee Kun-hee, who heads South Korea's largest industrial conglomerate, was sentenced to two years in jail suspended for three years. That will keep him out of jail. But chairman Kim Woo-choong of Daewoo, the third-ranking business group, was given a two-year jail term without suspension. Also jailed, for 2-1/2 years, was the head of Dong-Ah group, Choi Won-suk, whose company has massive construction projects in the Middle East and Libya. It was not clear whether the tycoons would be jailed immediately. "I believe the president will pardon the business leaders," said Rhee Namuh, head of research at Dongbang Peregrine Securities. "They represent too big a part of the economy." "There is an appeal process, and we expect most of them to get suspended sentences at that point," said a Hyundai Securities broker. (US$1 = 818 won) 3067 !GCAT !GCRIM !GPOL A South Korean court sentenced former president Chun Doo Hwan to death on Monday on charges of masterminding a 1979 coup and an army massacre of pro-democracy demonstrators the following year. His presidential successor, Roh Tae-woo, was sentenced to 22-1/2 years in prison for playing a supporting role. Both men were army generals during the putsch, which thrust Chun to power. The army massacre in the southern city of Kwangju killed about 200 civilians by official count and crushed democratic opposition to Chun's martial law rule. The three-judge panel said Roh was spared the death sentence in recognition of his role in gaining South Korea entry into the United Nations in 1991 and his other diplomatic achievements. Both were found guilty of taking bribes. Chun was fined 225.9 billion won ($276 million) and Roh 283.8 billion won, equal to the amount they were convicted of pocketing. Chun's rise to power "cannot be justified as it was obtained through illegal means which inflicted enormous damage on the people", according to the judges' verdict. Referring to the Kwangju massacre, it accused the defendants of "putting down popular resistance to clear the way for their rise to power". Chun and Roh are expected to appeal the sentences handed down by the Seoul District Criminal Court after what was dubbed South Korea's "trial of the century." Many Koreans are convinced that current President Kim Young-sam, whose campaign to "right the wrongs of history" prompted the legal action, will offer them pardons. The two have remained defiant, defending the coup as needed to prevent turmoil following the assassination of president Park Chung-hee. The court also passed judgment on 14 former military cronies of Chun and Roh. One was cleared of charges relating to Chun's grab for power while the other 13 were sentenced to jail terms of four to 10 years. Later on Monday, nine business tycoons and nine former officials were to be sentenced on bribery charges. Among the moguls are the chairmen of the mighty Samsung and Daewoo groups. After the sentencing, women relatives of the Kwangju victims attacked Roh's son, Jae-hun, as he left the court and shouted "Kill the murderer's son." Earlier the women, dressed in white mourning garb, cheered when news of the death sentence reached them. Some burst into tears when they heard Roh had escaped capital punishment. "Hand over all the slaughterers to us and we will finish them off, as they killed our children," sobbed one old woman. Chun and Roh, former military academy classmates, arrived in court dressed in pale blue prison pyjamas. They briefly squeezed hands as they took their places in the defendants' box. Their administrations spanned 13 years from 1980-1993 during which South Korea traversed a path to democracy and built a world-class economy. In a society where "face" is everything, their downfall has been spectacular. Part of a ruling elite of tough officers who emerged from the barracks to orchestrate the country's military-style economic charge, they are now despised. The trial is being closely watched by other young Asian democracies struggling to lay to rest the ghosts of past military excesses. Chun gained respect for his rigid defiance of court proceedings. A protest hunger strike in his detention cell brought him to the brink of death. But public thirst for vengence waned as evidence mounted that not just the star defendants but almost every leading politician and tycoon in the nation were tainted by corruption. Visceral anger against Chun and Roh is confined mainly to Kwangju and surrounding South Cholla province. The two former presidents still enjoy support in their home provinces, a factor President Kim must weigh as he seeks backing for a candidate of his choice to contest presidential elections next year. (Conversion $1 = 818 won) 3068 !GCAT !GCRIM !GPOL !GVIO A South Korean court sentenced former president Chun Doo Hwan to death on Monday on charges related to a 1979 coup and an army massacre of pro-democracy demonstrators the following year. His presidential successor, Roh Tae-woo, was sentenced to 22-1/2 years in prison on similar charges of masterminding the putsch that thrust Chun to power and of attempted murder of superior officers. At the time both men were army generals. Chun was cleared of murder in connection with the 1980 army assault on the southern city of Kwangju in which about 200 civilians were killed, by official count. But he was convicted of the lesser charges of plotting the crackdown and mobilising troops. Both were found guilty of taking bribes. Chun was fined 225.9 billion won ($276 million) and Roh 283.8 billion won, equal to the amount they were convicted of pocketing. Chun and Roh are expected to appeal the sentences handed down by a three-judge panel at the Seoul District Criminal Court after what was dubbed South Korea's "trial of the century." Many Koreans are convinced that current President Kim Young-sam, whose campaign to "right the wrongs of history" prompted the legal action, will offer them pardons. The two have remained defiant, defending the coup as needed to prevent turmoil following the assassination of president Park Chung-hee. The court also passed judgment on 14 former military cronies of Chun and Roh. One was cleared of charges relating to Chun's grab for power while the other 13 were sentenced to jail terms of four to 10 years. Later on Monday, nine business tycoons and nine former officials were to be sentenced on bribery charges. Among the moguls are the chairmen of the mighty Samsung and Daewoo groups. After the sentencing, women relatives of the Kwangju victims attacked Roh's son, Jae-hun, as he left the court and shouted "Kill the murderer's son." Earlier the women, dressed in white mourning garb, cheered when news of the death sentence reached them. Some burst into tears when they heard Roh had escaped capital punishment. "Hand over all the slaughterers to us and we will finish them off, as they killed our children," sobbed one old woman. Chun and Roh, former military academy classmates, arrived in court dressed in pale blue prison pyjamas. They briefly squeezed hands as they took their places in the defendants' box. Their administrations spanned 13 years from 1980-1993 during which South Korea traversed a path to democracy and built a world-class economy. Roh's refusal to be a rubber stamp for Chun while in office led to popular elections for the presidency in 1987. In a society where "face" is everything, their downfall has been spectacular. Part of a ruling elite of tough officers who emerged from the barracks to orchestrate the country's military-style economic charge, they are now despised. Enraged Koreans heard evidence that sackloads of cash were delivered to the presidential Blue House by tycoons. The trial also is being closely watched by other young Asian democracies struggling to lay to rest the ghosts of past military excesses. Chun gained a measure of respect for his rigid defiance of court proceedings. A protest hunger strike in his detention cell brought him to the brink of death. But the public's thirst for vengeance waned as evidence mounted that not just the star defendants but virtually every leading politician and tycoon in the country were tainted by corruption. Visceral anger against Chun and Roh is confined mainly to Kwangju and surrounding South Cholla province, kept alive by the enduring backwardness of the opposition stronghold. The two former presidents still enjoy widespread support in their home provinces, a factor President Kim must weigh as he seeks backing for a candidate of his choice to contest presidential elections next year. (Conversion $1 = 818 won) 3069 !C24 !CCAT !GCAT !GDIS !GENV Four shiny new green-and-yellow John Deere combines parked at this 1,750-hectare (4,325-acre) farm in the grain-growing regions south of Kiev don't fill its chief agronomist with enthusiasm. "They did a good job this year, but they need good diesel and good engine oil," said Ivan Odnosum. "God help us if there is a breakdown," he said of the machinery, loaned to the farm after the Ukrainian government bought it earlier this year. The country's grain harvest this year is forecast to fall by more than 23 percent to only 28 million tonnes and two harsh factors are to blame. A drought scoured the steppes in May and June, stunting the growing wheat. And the farming sector, making the painful transition from Soviet central planning to a market economy simply has no money. Ukraine's black soil is so fertile that a diplomat described it as "rich enough to grow rubber boots". But recently Ukraine has been losing its reputation as a breadbasket of Europe, earned in the years before brutal forced collectivisation under Soviet dictator Josef Stalin. "The wheat will not be of a good quality this year," said Hryhory Borsuk, a scientist at the Mironivka Wheat Institute, run by the Ukrainian Academy of Agrarian Sciences. "The temperature on the ground reached 62 decrees Celsius (143.60 Fahrenheit) this summer. We've never seen anything so bad," he said in an interview in his office, unlit since the government cut off electricity because of unpaid power bills. The harvest is gathered in the dry areas, but rainfall in Western Ukraine has delayed harvesting there. While Mironivka's scientists, some unpaid for months, carry on developing new strains of wheat resistant to Ukraine's extreme continental climate, Borsuk said the lack of cash in Ukraine's agricultural sector is as bad as the drought. Collective farms and Ukraine's nascent private farming sector have no money for fertiliser, no money for herbicides and pesticides, no money to repair old or buy new machinery, no money for fuel, and none to buy good seed. This year's harvest is down from last year's 36.5 million tonne harvest, which in turn compares with 50 million tonnes in 1990, the year before independence. The decline is all the worse for people who recall wasteful Soviet times, when the Kremlin imported grain but priced bread so cheaply that people bought it to feed their pigs. "Agriculture is very expensive, and there are no solutions to our problems on the horizon," said Odnosum. He said his farm, its 260 workers now readying the fields for winter wheat sowing, expected the land to yield 5.2 tonnes per hectare (2.5 acres) but ended up with 3.9 tonnes -- still better than the national average of 2.11 tonnes per hectare this year. "We did not have money for fertiliser, we're in debt for fuel, and we're borrowing diesel," Odnosum said. A few kilometres (miles) down the two-lane road which passes Odnosum's farm, where the occasional horse-drawn buggy passes by, is the 1,700-hectare (4,200-acre) Shevchenko collective farm, built next to a village still neat and tidy despite post-Soviet decay. Chief Accountant Natalya Sypron said the collective is strapped for cash, earlier this year bartering 220 tonnes of grain for diesel to fuel six rickety grain combines and tractors badly in need of repairs and basic maintenance. The average family earns 160-200 million karbovanets a year ($800-$1,000) -- but many have not been paid in months, Soprun said. "People are working out of their own dedication." Borsuk said the farm sector has two options: "We can sit down and cry, or we can do something." He said the government plans to increase the sowing of the winter wheat which will be harvested next year. Planted in late summer and early autumn, the grain is Ukraine's largest export item and traditionally grows better than summer wheat in Ukraine's soil. Further plans, he said, called for full provision of resources like fertiliser and herbicides for 25 percent of Ukraine's arable land next year, for 50 percent in 1998 and 100 percent of the land in 1999. "If we follow this we'll be able to sell 10 million tonnes of grain by the year 2000," Borkus said. The government has been trying to phase out huge subsidies to the farm sector, and in a move back to pre-Soviet days has given up to 50 hectares (124 acres) of land to some 36,000 private farmers willing to go it alone. Collective farms will last for the next few years, because most private farms now only produce enough to feed themselves with maybe a little extra to sell, said one private farmer: "In the future, maybe, but it's better not to hurry. "Collectivisation brought us a lot of pain. And it went too fast. Privatising too quickly can also have a negative outcome." 3070 !GCAT London's annual Notting Hill Carnival, the largest in Europe and second in the world only to Rio, ended peacefully on Sunday with an estimated 800,000 revellers singing and dancing the day away in high spirits. Police said they made 30 arrests and there were two stabbings. But there was no repeat of the ugly scenes that used to scar the street festival, and police praised the crowds over the two days of festivities as good-natured. Around 400 police were wounded in riots in 1976 when the carnival, now in its 31st year, acquired its darker reputation from which it is now only slowly recovering. Shopkeepers still board up their windows and many residents leave town for the weekend, but for four or five years there has been no disorder and relatively little crime. 3071 !E51 !E512 !ECAT !GCAT !GDIP A Yugoslav trade mission flew into Sarajevo on Monday, the first such group to travel to the Bosnian capital since war broke out here in 1992. Headed by Yugoslav Deputy Prime Minister Nikola Sainovic, the Yugoslav mission reciprocated a Bosnian trade delegation which visited Belgrade on July 23. According to the Yugoslav state news agency Tanjug, Sainovic was scheduled to discuss normalising relations, and economic ties in particular, with officials from Bosnia's Moslem-Croat Federation. Tanjug said the negotiations were a continuation of talks begun when Federation vice-President Ejup Ganic led Bosnia's July delegation. The officials were also expected to discuss establishing a regular air links to Bosnia, Tanjug quoted the Federal Information Ministry as saying. A group of 15 Yugoslav businessmen headed by President of the Serbian Chamber of Commerce is accompanying Sainovic on the trip which is scheduled to include a visit to the Serb- controlled city of Banja Luka later in the afternoon. Yugoslavia lost four of its six republics in recent years as Slovenia, Croatia, Bosnia and Macedonia gained independence. Croatia and Bosnia fought protracted wars, in part against the republics of Serbia and Montenegro which remained as the new rump Yugoslavia. Yugoslavia and Croatia signed a mutual recognition accord on Friday, ending five years of hostility between those two countries. Yugoslavia and Bosnia have not yet recognized one another, but the exchange of trade delegations is viewed by diplomats as a practical step in that direction and a further sign that stability is returning to the Balkans. 3072 !E51 !E512 !ECAT !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto was due to meet Brazilian President Fernando Henrique Cardoso in Brasilia on Monday for talks expected to focus on strengthening ties, officials said. Japanese officials said they would also preside over the signing of $550 million in Japanese economic development aid, aimed at four environmental projects in Brazil. Hashimoto's told reporters spokesman on Sunday the Japanese premier would also like to discuss some multilateral issues with Cardoso, including reform of the United Nations and progress on a Comprehensive Nuclear Test Ban Treaty. "But that depends on the time and how the talks on bilateral issues go," he said. After talks with Cardoso and lunch at Brasilia's futuristic Foreign Ministry building, the Japanese leader was expected to meet representatives of Brazil's Japanese community, at 1.3 million the largest outside Japan. On a Latin American tour that has already taken him to Mexico and Chile, Hashimoto arrived in the sprawling metropolis of Sao Paulo on Saturday and was due to depart Brasilia for Lima, Peru, on Monday afternoon. 3073 !C12 !CCAT !GCAT !GCRIM Foster's Brewing Group Ltd said on Monday its board had considered the company's civil case against the Bank of New Zealand Ltd, John Elliott and others and have decided to conduct a complete review of the case. However, Foster's said it had not withdrawn its civil action. The directors of Foster's said in a statement they had an obligation to act in what they believed and had been advised were the best interests of Foster's shareholders. "A complete review is being conducted in consultation with advisors. FBG has not withdrawn its civil action," the directors said of the case against Elliott, Peter Scanlon, Ken Biggins, Ken Jarratt. Last week the Victoria Supreme Court acquitted former corporate high flier John Elliott of defrauding his old Elders IXL business empire. Elliott's acquittal was ordered by Judge Frank Vincent after the prosecution withdrew its case, noting an earlier court ruling that much of its evidence was inadmissable. In 1994, the National Crime Authority charged Elliott and his co-accused, alleging they used sham currency deals to pay New Zealand businessman Allan Hawkins a A$66.5 million fee for helping Elders defend The Broken Hill Pty Co Ltd (BHP) against a takeover bid from the late Robert Holmes a Court in 1986. Elders owned 20 percent of BHP at the time and owned what is now Foster's Brewing Group. 3074 !C12 !CCAT !GCAT !GCRIM !GPOL Jail sentences handed down to several of South Korea's business leaders sent shockwaves through corporate boardooms on Monday, but analysts said the moguls were unlikely to spend time behind bars. Putting them in jail would be too great a blow for an economy dominated by family-owned conglomerates, some run almost single-handedly by ageing patriarchs, the analysts said. Samsung group chairman, Lee Kun-hee, was among nine businessmen found guilty by the Seoul District Criminal Court of bribing former president Roh Tae-woo. The court handed Lee a two year sentence suspended for three years, meaning he will avoid jail. But the chairman of the Daewoo group, Kim Woo-choong, the honorary chairman of the Hanbo Group, Chung Tae-soo, and the chairman of the Jinro group, Chang Jin-ho, were each sentenced to two years in jail. The chairman of the Dong-Ah group, Choi Won-suk, was sentenced to a 2-1/2 year term. "Kim Woo-choong pulled in all these Eastern European deals. There's really no one who could take his place," said Rhee. A Daewoo spokesman said Kim would appeal. Kim Su Mi said the court had little option but to hand out jail sentences. "This is more of a political issue than an economic one. Citizens, especially students, would have been outraged if they got less," she said. Senior judge Kim Young-il said he had not been swayed by the business power of the tycoons. "The heavy sentences are given despite the businessmen's contributions to the national economy and development of their groups, because it should not become a precedent to receive a light sentence because of contributions to the economy," he told a news conference. Prosecutors had demanded heavier jail sentences. The stock market slumped ahead of the sentencing, though brokers said weak fundamentals rather than the outcome of what has been dubbed the "trial of the century" were to blame. The composite stock index fell 15.24 points to 766.89, the lowest close since November 4, 1993, when it closed at 766.55. Yonhap news agency quoted unnamed finance ministry officials as saying they were concerned overseas investors would be scared away by the sentencing. All the businessmen have seven days to appeal their sentences. During that time they remain free. "There is an appeal process, and we expect most of them to get suspended sentences at that point," said a Hyundai Securities broker. The heads of Dongbu group, Daelim Group, the former head of Daewoo Corp and the head of the unlisted Daeho Construction were given suspended jail sentences. Former president Roh was sentenced to 22-1/2 years in jail and his predecessor Chun Doo Hwan to death for their roles in a 1979 coup and an army massacre the following year in the southern city of Kwangju. 3075 !C33 !C331 !CCAT !GCAT !GDEF Taiwan's military-controlled Aerospace Industrial Development Corp will seek British help to spruce up the island's ageing F-5E fighters for export, the China Times Express said on Monday. The project will upgrade 200 F-5E fighters at a cost of US$3 million to US$7 million each so they can be shipped to developing countries in the form of exports or aid, the paper quoted high-level military officials as saying. No British firms were identified by name and the report did not say what countries would receive the aircraft. The defence ministry declined to comment on the report. The disclosure came amid a new row between China and the United States over Washington's arms sales to Nationalist-ruled Taiwan, which Beijing regards as a renegade province. Beijing on Monday demanded Washington cancel plans to sell Stinger missiles, launchers and other weapons to Taiwan to prevent new damage to Sino-U.S. relations. The United States has reserved a right to arm Taiwan for defensive purposes since breaking diplomatic ties with the island and recognising the communist People's Republic in 1979. Taiwan has planned to export the refitted F-5E fighters since the early 1990s when it ordered 150 U.S.-made F-16s and 60 French-made Mirage 2000 fighters to replace them. Taiwan, estranged from the Chinese mainland since a civil war split them in 1949, has worked hard to keep its air force up to date in the face of China's military modernisation. The newspaper said a procurement mission would visit Britain and a cooperation agreement was expected to be signed, but gave no further details of the arrangements. The team is travelling with Vice-Premier Hsu Li-teh in South Africa and Britain would be its next stop, the report said. Hsu's mission ends on September 3. After Britain, the team would visit the Czech Republic to explore the possibility of jointly manufacturing nine-seat AE-270 commercial jets, the newspaper said. 3076 !E14 !E143 !ECAT !GCAT !GHEA The deadly O-157 bacteria outbreak which has killed 11 people in Japan this summer, has also caused a substantial drop in sales of fresh food and other goods thought to be linked to the epidemic. "The O-157 bacteria is affecting sales greatly, and there are no clear prospects of when this will subside," a spokesman for the Japan Chain Stores Association said on Monday. The O-157 colon bacillus has been found responsible for a widespread food poisoning epidemic this summer in Japan that has killed 11 people and made more than 9,500 people ill so far. The nationwide outbreak of food poisoning caused by the O-157 bacteria led to diminishing sales of fresh foods and leisure-related products, the association said. Department store sales in Japan fell 2.4 percent in July from a year earlier to 898.66 billion yen ($8.32 billion), the Japan Department Stores' Association said. Chain stores also reported a 2.5 percent drop in sales that month to 1.48 trillion yen ($13.7 billion). The bacillus causes severe diarrhoea, vomiting and fever that often leads to liver complications. Other reasons cited for a drop in sales were due to one less weekend that month, and a decline in seasonal gift-giving because of a weak economic recovery. "There is a shift in consumption from one type of food to another to avoid the bacteria, but this is not enough to cover for losses. It is also difficult to regain the trust of consumers when one type of food is put into question by hearsay," the association spokesman said. The bacteria outbreak has had a devastating impact on sales of fresh food. Since the start of the outbreak, raw fish, liver, chicken, noodles and a variety of sweets have all been blamed and then exonerated -- but not before causing sales of the items to plummet. Radish sprouts also joined the growing list of food items first blamed for causing the epidemic and then cleared of responsibility. Consumers kept away from fresh vegetables for salads, such as cucumber and lettuce. Watermelon sales, traditionally a very popular fruit during the hot summer season, were down. Meat sales also slipped as people avoided beef, ham and hamburgers. Even sales of traditional Japanese raw foods such as sashimi and sushi were sluggish. ($1=108 yen) 3077 !C24 !CCAT !GCAT !GODD China plans to auction train tickets made of pure gold to mark the opening of a line that eventually will link Beijing and Hong Kong, the China News Service said on Monday. Rail authorities issued the 42 tickets weighing three grams (0.1 oz) each for auction on August 31 in Shanghai and the central Chinese province of Jiangxi, it said. A train service will begin on September 1 to the southern city of Shenzhen bordering Hong Kong but will not continue to Hong Kong's Kowloon district until the British colony reverts to Beijing rule on July 1, 1997, state media have said. Winning bidders would be entitled to a one-way ride within a year. 3078 !C41 !CCAT !GCAT !GCRIM !GPRO A South Korean court on Monday sentenced the chairman of the Samsung group to a two year jail term suspended for three years after convicting him of bribery, Yonhap television reported. The sentence means that Lee Kun-hee will not have to spend time in jail. Yonhap television said the chairman of Daewoo group for bribing former president Roh Tae-woo. The chairman of the Dong-Ah group, Choi Won-suk, was sentenced to 2-1/2 years in prison, also for bribery. It was not immediately clear whether the Daewoo and Dong-Ah chairmen would be jailed immediately, according to Yonhap and other South Korean broadcasters. 3079 !C13 !C24 !CCAT !GCAT !GHEA Mongolia has banned the slaughter and sale of beef in two counties to try to contain an anthrax epidemic that has killed dozens of cows and threatens to infect thousands more, officials said on Monday. An emergency commission in the northern province of Hoevsgol would meet to discuss closing off the whole province following outbreaks of the disease in at least four counties in the past 10 days, commission head Ulambayar told Reuters. Authorities had quarantined herds suspected of carrying the contagious bacterium, Ulambayar said. "We are afraid this disease may spread from cows to sheep and even to people," he said. The anthrax bacterium is deadly to cows and sheep and can be transmitted to people. Half of Mongolia's 2.3 million people are nomadic herders. "At the moment cattle cannot be moved from the two isolated counties, where slaughtering and selling beef is also banned," Ulambayar said. The extremely contagious disease threatened at least 207,000 cattle in the four counties, he said, adding that the whole province had 388,000 cattle. "The bacteria ... lives deep in the grassland soil. It may live up to 50 to 70 years in the soil," said Batsuur, director of the State Cattle Hospital in the capital Ulan Bator. He said Ulan Bator had sent veterinarians armed with vaccines to infected areas to prevent the spread of the disease. Inspection of meat in markets in Ulan Bator had found no traces of the bacteria, he said. Officials have also been struggling to contain an outbreak of cholera in the north of Mongolia that has killed least 10 people and infected 134 in the last three weeks. 3080 !GCAT !GCRIM !GPOL !GVIO A South Korean court sentenced former president Chun Doo Hwan to death on Monday on charges relating to a 1979 coup, Yonhap television reported. Chun was found guilty of masterminding the putsch and of attempted murder of his then senior officers. At the time he was an army general. Chun's presidential successor, Roh Tae-woo, was sentenced to 22-1/2 years in jail on similar charges. Chun was cleared of a separate charge of murder in connection with a massacre in 1980 of pro-democracy protesters in the southern city of Kwangju. 3081 !C12 !CCAT !GCAT !GCRIM !GDEF Turkey's chief of staff has filed a case against the English-language Turkish Daily News for "publicly insulting" the military in a newspaper article, a source at the newspaper said on Monday. He said an Ankara court would hear the case against Daily News editor Ilnur Cevik and correspondent Hayri Birler. The source said the charges concerned an article about an alleged survey of public opinion by the army's general staff on how to solve a protracted government crisis in Turkey and how to handle a stand-off with Greece over an Aegean islet. He said military officials had called the newspaper and complained, saying the survey had been a private one commissioned by a couple of individual officers. The newspaper had printed the denial the next day, and thought the matter closed. But then charges were filed on July 30, the source said. Birler and Cevik face up to six years in jail if convicted. The first hearing takes place on October 8. Birler declined comment on the case until the first hearing and Cevik was unavailable. Turkey was effectively without a government between September last year and June, when a series of caretaker governments and an ill-fated conservative coalition presided while party leaders wrangled over what to do. The powerful military takes pains to distance itself publicly from the running of the state, although critics claim the armed forces are more influential than politicians. 3082 !E12 !ECAT !GCAT !GPOL !GVIO Jordan announced measures to boost private investment in the economy and create jobs in the wake of bread riots, officials and businessmen said on Monday. Prime Minister Abdul Karim al-Kabariti told them late on Sunday the government's commitment to free market reforms was unaffected by riots that followed doubling of bread prices, the worst unrest in Jordan since 1989. Kabariti pledged a two-pronged policy of encouraging private sector investment while strengthening a safety net for Jordan's poor -- a majority of its 4.2 million population -- during the transition period. Kabariti said the government had drafted key laws to boost export industries and attract foreign investment to create jobs. Unemployment and poverty were widely blamed for the bread riots this month. Jordanian officials say unemployment is 15 percent of a 900,000 labour force, but economists believe it is at least 25 percent. The prime minister also announced the removal in September of tariffs on 492 capital goods to boost industrial investment and an end to inspection of certain imports to cut red tape. Kabariti referred to a new companies law that would lift a capitalisation tax to help companies raise capital, a new securities law for the stock market and a move to create mutual funds to channel small savings. Kabariti defended the decision to double bread prices but acknowledged tough economic policies during a transition period might cause social upheaval. But he said he would not backtrack on reforms that harmed "vested interests and marginal producers" cushioned by what he termed structural distortions that harm ordinary citizens. The IMF-sanctioned plan to cut bread subsidies was needed to begin broader free market reforms put off by governments since Jordan embarked on monetary stabilisation reforms after a severe economic crisis in 1989. Officials say the World Bank and the IMF have pledged support for expanding a safety net for Jordan's poor during the reforms to prevent social upheaval. -- Amman Newsroom +9626-623776 3083 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The United Auto Workers union is discussing the possibility of an extended five- or six-year contract with the nation's largest automakers, UAW and company officials said Monday. The union is open to the idea of a contract longer than the typical three-year pact if it offers significant job security guarantees, officials said. "It has surfaced in the subcommittees," said Carl Dowell, president of UAW Local 862 in Louisville, Ky. "There was no problem with a longer-term agreement if it's fruitful for our people. Job security is the key." Contract talks with General Motors Corp., Ford Motor Co. and Chrysler Corp. resumed Monday after meetings late last week between UAW President Stephen Yokich and the automakers' chairmen. The UAW has not yet chosen which company it will negotiate a pattern agreement with. Yokich said last week that he delayed the union's traditional choice of a "strike target" to allow the negotiating progress to continue at all three companies. A UAW spokesman said no decision on a target company is expected this week. Traditionally, the target is threatened with a national strike on the contract expiration date if no agreement is reached by then. The current pact, covering about 400,000 U.S. hourly workers at the three automakers, expires September 14. Ford spokesman Jon Harmon said the automaker suggested to the UAW about three weeks ago that both sides should examine possibly negotiating a longer-term contract. He said a longer agreement would stabilise Ford's future costs, allowing it to evaluate future product and investment decisions more accurately. "It gives you more of a known quantity," he said. Yokich has said he would be open to a longer contract if the automakers "want to buy it." However, many UAW officials remain sceptical about a longer-term pact and say that removal of a strike threat every three years could invite abuses by the automakers. "The question is how can GM live up to a five-year agreement when they can't live up to a three-year agreement?" said Ed McNulty, president of UAW Local 14 at GM's Toledo, Ohio, truck transmission plant. Such an agreement would have to provide a mechanism for enforcement of the contract and for revisions to resolve local issues over sourcing and staffing levels that are sure to arise over the life of the contract, he said. GM has been hit by several strikes at individual plants over the current three-year contract over sourcing and jobs. "You're going to have to have some good job security and outsourcing provisions for the membership to go for it," McNulty said. 3084 !C12 !CCAT !GCAT !GCRIM Lloyd's of London will head back to court Tuesday in a desperate bid to overturn a U.S. court ruling that it claims threatens its reorganization plan. A federal judge on Friday granted a preliminary injunction blocking the plan and ordered Lloyd's to give U.S. investors additional information. Lloyd's appealed the ruling and plans to argue that any delay of the plan will push it into insolvency. A hearing on the appeal is scheduled for Tuesday morning. Lloyd's, which says investors must decide whether to accept or reject the plan by Wednesday, was hoping for a quick decision from the three-judge appeals panel. More than 75 percent of Lloyd's 34,000 investors worldwide, known as Names, have already accepted the offer. But Lloyd's has said the reorganization plan cannot proceed without the consent of its American investors. If it were to lose the appeal, a Lloyd's spokesman said it would be forced to reconsider its alternatives and consider contingency plans. The spokesman declined to provide details about the contingency plans, but said the injunction would have grave consequences for Lloyd's. But, a Names representative said overturning the injunction would be like throwing out the investors' lawsuit because investors would be faced with no alternative but to decide on the Lloyd's plan Wednesday. "Staying the execution of the injunction has the effect of saying the deadline is still Wednesday," said Kenneth Chiate, chairman of the litigation committee for the American Names Association, which represents 1,000 U.S. Names. In addition, he disputed Lloyd's contention that it faced grave consequences from the injunction. "Lloyd's is attempting to bully the court and judiciary into believing their decision is make or break for Lloyd's," he said. In a motion filed in the U.S. Court of Appeals for the Fourth Circuit in Baltimore, Lloyd's said "the injunction poses an imminent threat to the survival of a major international insurance marketplace on which hundreds of thousands of policyholders, including policyholders in the United States, depend for their financial security or solvency." The motion argues the investors will not suffer irreparable harm from a stay of the injunction. Lloyd's, however, must meet solvency tests with British regulators by the end of the month, with the New York insurance department by Sept. 1 and with the U.S. Treasury by Sept. 30, according to the motion. "Failure to satisfy the solvency tests would lead inexorably to 'run-off,' in which no new policies could be issued and the sole focus of the market would be the settlement of claims made on existing policies," it said. In run-off, administrative expenses would increase, syndicate assets would be frozen and policyholders would file lawsuits, Lloyd's said in the motion. The 300-year-old insurance market, known in the United States for insuring high-profile celebrities like Betty Grable, ran into trouble in the 1980s when it was hit with massive losses from natural disasters and claims on asbestos and environmental policies. Under its reorganization plan, Lloyd's plans to reinsure billions of dollars of liabilities into a new company called Equitas. It is asking the Names to help pay for Equitas and has offered to forgive some of their outstanding liabilities in return for an end to litigation and their association with Lloyd's. The Names had agreed when they joined Lloyd's to financially back it with all their personal assets in exchange for a share of the premiums. Many of the U.S. Names are now facing financial ruin because of Lloyd's losses. U.S. district judge Robert Payne ruled that Lloyd's sold securities to U.S. Names in violation of U.S. securities laws. Lloyd's disagreed and contended that the Names' lawsuit was an effort to gain a better bargaining position with Lloyd's. Lloyd's also is challenging the U.S. courts' jurisdiction in the case. It said in its motion that the British government, which regulates Lloyd's, has reviewed the reorganization plan and has concluded that it is critical to Lloyd's survival. It also said that excluding American Names, or even some of them, from reinsurance into Equitas was not possible. Lloyd's said it does not have the funding to pay the reinsurance premium to Equitas on behalf of the American Names and said it can not borrow a syndicated loan facility of 300 million pounds ($467 million) mentioned in the plan. 3085 !C12 !C13 !CCAT !GCAT !GCRIM !GENV A shipping company has sued the U.S. government seeking compensation for a requirement that its vessels have double-hulls, and industry officials said Monday that if successful, the case could cost taxpayers millions of dollars. The lawsuit was filed by Maritrans Inc., which is seeking $200 million under a clause in the Fifth Amendment of the Constitution, which prohibits the government from taking private property "without just compensation." The government must respond to the suit by Oct. 7. "(The case) has some very major policy implications if they are successful," said Sean Connaughton, an attorney with law firm Eckert, Seamans, Cherin and Mellott. "There are tens of thousands of barges and thousands of vessels that could potentially be affected by this," he said. Maritrans argued that the government devalued 37 of its oil-carrying barges when the Oil Pollution Act, passed in 1990 after the Exxon Valdez disaster, called for all tank vessels in U.S. waters to have double hulls by 2015. The requirements were phased in from 1995 according to the size and age of vessels. The company filed the lawsuit Aug. 7 but announced it only last week after the six-year statute of limitations expired for filing what is commonly known as a "takings" action, said Arthur Volkle, a lawyer for Maritrans. After the law came into force, the company chose not to repair several barges when they came up for maintenance "because their useful remaining lives were so limited that we didn't feel we'd get an adequate return," Volkle said. "We're not challenging the federal government's authority to enact the double hull provision," he said. "If they want to take our property in order to further their environmental protection goals, they have to pay us for it," he said. Industry officials said the Justice Department could raise several issues in response to the suit, including questions about whether the clock for damage claims had even begun ticking, how much value the vessels had lost and when they started losing value. Justice Department officials were unavailable for comment. Maritrans believes that its barges started losing value from the time the law was passed, and hence a "taking" prohibited by the Fifth Amendment occurred. "It's the first time maybe since Prohibition (in the 1920s) that the federal government has wiped out the capital base of a whole industry," said Volkle. If the court finds there was a "taking" and it began from the time the law was passed, other firms would be unable to sue for damages, since the six-year time limit for claims has passed. But if the court finds the "taking" begins from the date when a ship must be double-hulled, then other owners could start lining up for compensation. "It's really a question of whether the court thinks the Oil Pollution Act was a reasonable thing for Congress to do, and whether by having a graduated phase-out schedule, that was sufficient to allow owners and operators to recoup their costs," said Connaughton, the attorney for the shipping company. Officials at two major industry trade groups whose members were hit by the law -- the American Petroleum Institute and American Waterways Operators -- did not know about the lawsuit and said it had not been raised at their meetings. The Maritrans case is separate from one that Exxon subsidiary SeaRiver Maritime, Inc. brought against the government under the Oil Pollution Act for banning the use of its tanker Mediterranean, formerly the Exxon Valdez, from operating in Alaskan waters. That lawsuit, filed in March the U.S. District Court in Houston, with a related takings claim at the U.S. Court of Federal Claims, is still pending. 3086 !GCAT NEW YORK, Aug 26 - Actor Jim Carey is in serious talks to star in "The Secret Life of Walter Mitty," the remake of the 1947 Danny Kaye film, for New Line Cinema, a unit of Turner Broadcasting System, Daily Variety reported on Monday. Negotiations continued over the weekend to hammer out a deal, and sources said Carey could be in place by the beginning of September. Landing Carey would represent a major coup for New Line, reteaming a studio and a star whose upward growth is intertwined. The newspaper also reported: * New Line Cinema's remake of "The Island of Dr. Moreau" debuted at an estimated $9 million over the weekend, squeaking into the top spot just ahead of Warner Brothers' "Tin Cup." But despite four new wide releases and a number of narrower bows, the late summer box office remained tepid. At roughly $69 million for films grossing over $500,000, overall ticket sales for the three-day period were just about flat with the previous weekend and the comparable 1995 frame. * The fine line between politics and showbiz has been erased. Consider: Edward James Olmos, Christopher Reeve and the cast of "Rent" will appear at the Democratic convention Monday. Aretha Franklin and Bonnie Raitt performed at Demo-related concerts over the weekend, and President Bill Clinton will build anticipation for his arrival on Wednesday by beaming daily video appearances to the convention. * Marking another shakeup in top-level executive ranks, Universal president of production Hal Lieberman will leave his position to take a multiyear studio production deal, the studio said. Universal is a unit of Seagram Co Ltd. * News Corp's Fox Broadcasting Co is near a deal with Universal Television for a new period piece drama series from writer-producers Shaun Cassidy and Ron Koslow for next fall or possibly earlier, the studio said. * All American TV, a unit of All American Communications Inc, has signed former "Extra" anchor Arthel Neville to be the co-host of a daytime talk-variety strip for fall 1997. -- New York newsroom, (212) 859-1610 3087 !E41 !ECAT !GCAT !GJOB Twenty-five percent of U.S. employers say they plan to expand their work forces in the fourth quarter, The Wall Street Journal reported Monday. The survey by Manpower Inc shows the U.S. hiring outlook is brightening after a sluggish first half of the year. The finding "confirms what we would call a recovery from the first half of the year," said Mitchell Fromstein, chairman and chief executive of the Milwaukee-based temporary-staffing firm. The quarterly Employment Outlook Survey, to be released Monday, found that just nine percent of companies planned staff reductions in the final three months of the year. The survey said fourth-quarter hiring would also display less of a seasonal downturn than it had in the past five years. Normally, fourth-quarter hiring falls from the third quarter as the construction industry and others trim payrolls with the end of summer. But a hiring increase in the wholesale and retail industries has boosted job prospects this year. Manpower said the retail trades would see their "best holiday job scene in 13 years." Fromstein said he expected the strong hiring to continue into 1997, even though the survey does not officially forecast more than one quarter. 3088 !C11 !C12 !C13 !C17 !CCAT !GCAT !GCRIM Traver Smith, a 79-year-old retiree living in San Jose, Calif. with his wife Margaret, lost his life savings after investing in British insurance giant Lloyd's of London. And now he is on the brink of losing his $450,000 home, where he and his wife have lived for the last 45 years. But a U.S. court ruling late Friday gave Smith and other Americans who invested in Lloyd's new hope that they will not lose any more money to Lloyd's. Judge Robert Payne in Richmond, Va. issued a preliminary injunction delaying a Lloyd's reorganization plan that called for investors to pay up to $150,000 more to fund a newly formed reinsurance company, Equitas. In return, investors could end their association with Lloyd's. But investors who did not agree to the plan faced the threat of additional losses and litigation. The investors, known as Names, had agreed when they joined Lloyd's to financially back it with all their personal assets in exchange for a share of the premiums. But Payne on Friday ruled that Lloyd's had sold U.S. Names securities and had violated U.S. securities laws in doing so. Lloyd's has said it will immediately appeal the judge's decision. But the decision brings U.S. investors a step closer to getting their day in court, said John Head, spokesman for the Association of Lloyd's State Chairmen. "We want our day in court; iron-clad, total, legal and financial rescission from Lloyd's, with restitution," he said. For Smith, the San Jose retiree, the U.S. legal effort represents one of his last chances to save what little he has left. "We're hanging on to spider webs," he said in a telephone interview with Reuters on Friday. The investment didn't seem like such a bad idea back in 1984. Smith said he sold his interest in an engineering business in 1983 when he retired and began looking for a safe place for his $300,000 nest egg. He turned to a trusted financial adviser who suggested investing in Lloyd's, where he had put his own money two years earlier. The 300-year-old institution had a sterling reputation and impressive membership. Other Names included members of Parliament, the British aristocracy, the Royal Family, even the Queen, he was told. The impression was that "you get to be an investor along with the Queen." To Smith, a novice investor, it all sounded reputable enough. "I thought I was following good advice," he said. A members agent from Lloyd's arrived a short time later to advise him on the investment and asked him how much risk he was willing to take, Smith said. "I said, 'Well, this is our nest egg. This is our last chance. I'll never earn this again so please be careful with it, be conservative,'" Smith said. And then Smith and his wife decided that she should be the Name since she was younger and might live longer, he said. They took out a 60,000 sterling ($93,372) letter of credit against their house and then increased it to 240,000 sterling ($373,488) in subsequent years as they expanded their investment into more Lloyd's syndicates in an effort to decrease their risk. In that way, losses from one or two syndicates that had a bad year would be more than offset by the profits from the other syndicates. Even when they encountered some losses, they continued to increase their investment. "What happened was everyone had confidence in Lloyd's," he said. But the Smiths had been put into some of the biggest money-losing syndicates at Lloyd's, Gooda Walker and Devonshire. And by 1991, before they had a chance to make much money, they began to be hit with massive losses. First an oil rig fire in the North Sea, and then Hurricane Hugo and other catastrophes. "We ran smack out of money. I didn't have a thing at that point and still I went down to the bank and tried to borrow money on the house," he said. But he was told the house was fully mortgaged on the letter of credit. "We were in for everything," he said. By this time, he said, his members agent at Lloyd's had been removed and the new agent immediately place him and his wife into a group to protect hardship cases. Now, several years later, Lloyd's says he must decide whether to accept the recovery plan, under which he must pay 694 pounds ($1,080) plus of the letter of credit or face liabilities of about 590,000 sterling ($918,158). And Lloyd's has told him that it will immediately draw down on his letter of credit if he rejects the recovery plan. "Now we're down to facing this decision and well, if they draw down our letter of credit, they finish us," he said. He said he has hope that his separate negotiations with Lloyd's for severely distressed Names may prove fruitful. Or he said that Lloyd's will be unwilling to comply with the court's order to provide investors with additional information and will just leave them alone. "If Lloyd's chooses not to make all these revelations, it won't have anything to do but go away and leave the Americans alone," he told Reuters on Sunday. Otherwise, he said, they would be left with nothing more than about $18,000 a year in Social Security. "But, we have hope, we have hope," he said. 3089 !E41 !ECAT !GCAT !GJOB The United Auto Workers and Big Three auto makers are discussing adopting an extended national contract that would last longer than the traditional three-year agreement, The Wall Street Journal reported on Monday. AT the same time, the union and General Motors Corp have settled some contentious local issues at the national bargaining table, signalling efforts by both sides to avoid a confrontation this fall. "Issues are being resolved as fast as they're being brought up," a GM official said. The UAW and the auto makers - GM, Ford Motor Co and Chrysler Corp - are considering a five- or six-year agreement, according to union and company officials. Last Thursday, the UAW was to choose a lead company to frame a new contract. However, in an unexpected move, the union decided to delay choosing a target and instead held meetings with chief executives from GM, Ford and Chrysler. The current contract between the union and the auto makers expires on Sept 14. -- New York newsroom, (212) 859-1610 3090 !E51 !ECAT !GCAT !GDIP Nearly 80 prominent Taiwanese business leaders and politicians plan to travel to Beijing this week on a high-profile visit, despite reservations voiced by the island's leaders about depending too heavily on rival China. The delegation, scheduled to leave on Tuesday, would be the largest to visit China since strengthening ties across the Taiwan strait began to fray in mid-1995 over Taiwanese President Lee Teng-hui's private visit to the United States. Beijing sharply criticised that journey as a move by Lee toward Taiwan's independence and away from the ruling Nationalist Party's stand in favour of eventual reunification with the mainland. Taipei and Beijing have been rivals since China's civil war separated them in 1949. Both espouse Taiwan's reintegration with the mainland, but are ideologically divided on how to do this. The delegation, organised by Taipei's Chinese National Federation of Industries, would meet their Chinese counterparts during a 12-day tour of Beijing and Shandong province, a federation official said by telephone on Monday. Federation chairman Kao Ching-yuan would head the delegates, who include Kao Hsin-yang, secretary-general of the economics ministry, and 19 chairmen of major Taiwan industry associations. Local newspapers said Kao Ching-yuan would meet Chinese President Jiang Zemin and other senior officials. The organiser declined to comment on the reports. The visit has aroused attention because Kao Ching-yuan is both a senior Nationalist Party member and vice chairman of President Enterprises, the island's biggest investor in China. The visit comes less than two weeks after President Lee called for a review of economic policy toward China with the aim of avoiding over dependence on the mainland for investment. Since a political thaw began in the late 1980s, some 30,000 Taiwan businesses have poured more than US$20 billion into China -- a number that would rise if Taiwan eased a ban on direct mainland ties dating to 1949. Analysts say Taiwan's huge investments in China make it vulnerable to efforts by Beijing to undermine the island's exiled Republic of China government. This vulnerability is expected to increase in mid-1997 when Hong Kong, the conduit for most Taiwanese investment in the mainland, returns to Chinese sovereignty after 150 years as a British colony. The China Times Express said on Sunday that Taiwan's Council for Economic Planning and Development had drawn up measures -- including contingency plans to restrict Taiwanese investment in the mainland -- if Taiwan-China relations deteriorate. 3091 !GCAT !GENT When Michael Jackson descends on the Czech capital of Prague in September to kick off his HIStory world tour, promoters are planning a monumental start to his first concert in two years -- literally. Perched high above the "golden city" in a spot once occupied by a massive 12-metre high, 30-metre wide monument of Stalin and his workers, tour organisers are hoping to erect their own 10-metre tall statue of the "King of Pop". "It's the same statue used to promote his HIStory album. I've been told that its 10 metres high, filled with water and I want to put a flame on each side (that's what Stalin had)", Jackson's Prague promoter Serge Grimaux told Reuters. The Stalin monument, built to glorify the strongman and the "average" worker, was taken down and destroyed soon after his death in 1953. Grimaux, who arranged last year's Rolling Stones concert at Prague's Strahov stadium, added that he was still negotiating with city officials for permission to erect the statue. Many Praguers have voiced concerns that the Jackson statue would commercialise one of the city's historic sites, located on a cliff overlooking its historic Old Town from the north edge of the city centre. In 1989, hundreds of thousands of protestors crammed Letna Plain, where the statue and the September 7 concert are planned, in one of several demonstrations that helped overthrow the ruling Communist regime. But Grimaux said the statue was not intended to make any political statement. "I believe he (Jackson) is very sensitive to these kinds of things." Jackson is expected to draw a crowd of some 130,000 to the concert. In 1990, Pope John Paul II gave a sermon on Letna to an estimated half million people. Jackson himself is scheduled to arrive in Prague on September 3 and tour local hospitals, orphanages and many of the country's tourist attractions, including one its castles, which he is reportedly interested in buying. 3092 !G152 !G154 !G155 !GCAT The following are the main stories from Monday morning's German newspapers: FRANKFURTER ALLGEMEINE ZEITUNG - Parliamentary arbitration committee to deal with government savings package; opposition SPD continues to criticise measure - Germany and France get highest creditworthiness marks in BIS survey ahead of monetary union - Hans-Olaf Henkel, president of German Industry Federation BDI, to stand for office again despite allegations HANDELSBLATT - SPD state finance minister puts forward tax reform plan with no net relief for firms - German electrical industry unlikely to see upturn before next year, head of association says - Opposition SPD continues to reject government savings package as parliamentary arbitration committee prepares to discuss measure - Saxony state goes to European Court over EU commission's opposition to state subsidies for Volkswagen plant - DAG white-collar union sees possible breakthrough in retail industry pay talks - International syndicated credits reach new record level in second quarter, BIS says - SPD intelligence and security expert calls for Bonn to break off diplomatic relations with Tehran - Internet industry under pressure as Compuserve makes loss - Deutsche Bahn boosts profit and turnover in first half - Weekly Spiegel says German deliveries to Libya of equipment to manufacture chemical weapons were even more extensive than believed - VW says it was spied on for months - O&K purchase of majority of Fried. Krupp AG Hoesch Krupp is put on ice SUEDDEUTSCHE ZEITUNG - Little chance of compromises between government and opposition on savings package - President of Federal Criminal Office says corruption threatens public service - Education minister Ruettgers says there will be enough training places for school leavers this year - British Airways to complain to Federal Cartel Office about Lufthansa's pricing policy - Economics Minister Rexrodt sees possible compromise in Saxony's row with EU over subsidies for VW DIE WELT - Tussle over government savings package continues - DIHT Federation of Chambers of Commerce calls for radical tax cuts - Saxony state goes to European Court over EU commission's opposition to state subsidies for Volkswagen plant - Hans-Olaf Henkel, president of German Industry Federation BDI, to stand for office again despite allegations - Transrapid operator plans to go public - Health insurers complain of wasteful spending -- Bonn Newsroom +49 228 2609760 3093 !G152 !G154 !G155 !GCAT The following are the main stories from Monday morning's German newspapers: FRANKFURTER ALLGEMEINE ZEITUNG - Parliamentary arbitration committee to deal with government savings package; opposition SPD continues to criticise measure - Germany and France get highest creditworthiness marks in BIS survey ahead of monetary union - Hans-Olaf Henkel, president of German Industry Federation BDI, to stand for office again despite allegations HANDELSBLATT - SPD state finance minister puts forward tax reform plan with no net relief for firms - German electrical industry unlikely to see upturn before next year, head of association says - Opposition SPD continues to reject government savings package as parliamentary arbitration committee prepares to discuss measure - Saxony state goes to European Court over EU commission's opposition to state subsidies for Volkswagen plant - DAG white-collar union sees possible breakthrough in retail industry pay talks - International syndicated credits reach new record level in second quarter, BIS says - SPD intelligence and security expert calls for Bonn to break off diplomatic relations with Tehran - Internet industry under pressure as Compuserve makes loss - Deutsche Bahn boosts profit and turnover in first half - Weekly Spiegel says German deliveries to Libya of equipment to manufacture chemical weapons were even more extensive than believed - VW says it was spied on for months - O&K purchase of majority of Fried. Krupp AG Hoesch Krupp is put on ice SUEDDEUTSCHE ZEITUNG - Little chance of compromises between government and opposition on savings package - President of Federal Criminal Office says corruption threatens public service - Education minister Ruettgers says there will be enough training places for school leavers this year - British Airways to complain to Federal Cartel Office about Lufthansa's pricing policy - Economics Minister Rexrodt sees possible compromise in Saxony's row with EU over subsidies for VW DIE WELT - Tussle over government savings package continues - DIHT Federation of Chambers of Commerce calls for radical tax cuts - Saxony state goes to European Court over EU commission's opposition to state subsidies for Volkswagen plant - Hans-Olaf Henkel, president of German Industry Federation BDI, to stand for office again despite allegations - Transrapid operator plans to go public - Health insurers complain of wasteful spending -- Bonn Newsroom +49 228 2609760 3094 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * Call for tenders, open procedure, for 1 expert position in DG XIII (Official Journal of the European Communities No C 243, 22.8.1996, p. 5) (96/C 246/30) Maintenance of industrial and domestic-type refrigeration installations in the Commission buildings Open procedure (96/C 246/29) Health inspection services Open procedure (96/C 246/28) Advanced television services Invitation to tender concerning the provision of support for the implementation of the plan of action for the introduction of advanced television services in Europe (96/C 246/27) Tacis - production and trade licence, know-how, T.A. and models for manufacturing of agricultural equipment Notice of invitation to tender issued by the Commission of the European Communities on behalf of the Government of the Russian Federation financed in the framework of the Tacis Programme (96/C 246/26) Phare - laboratory equipment Call for tender Local advertisement (96/C 246/25) Phare - sewage treatment investment programme for selected cities Phare Water Management Programme 1995, Hungary Invitation for expressions of interest for prequalification (96/C 246/24) Phare - sewage treatment investment programme for selected cities Phare Water Management Programme 1995, Hungary Invitation for expressions of interest for prequalification (96/C 246/23) Furniture removals, transport and handling Open procedure (96/C 246/22) Study entitled 'A study of the technical means to provide number portability and its related costs' Open call for tenders (96/C 246/21) Study on issues related to accounting separation and interconnection pricing in the context of open network provision (ONP) Open call for tenders (96/C 246/20) Study entitled 'study on evolution of access networks for telecommunications and the regulatory consequences' Open call for tenders (96/C 246/19) Study entitled 'study on recommended practices for collocation and other facility sharing for telecommunications infrastructure' Open call for tenders (96/C 246/18) Service companies Contract award notice (96/C 246/17) Service company Contract award notice (96/C 246/16) Financial support for cooperatives, mutual societies, associations and foundations Call for proposals (96/C 246/15) EUROPEAN ECONOMIC INTEREST GROUPING Notices published pursuant to Council Regulation (EEC) No 2137/85 of 25 July 1985 (1) - Formation (96/C 246/14) Communication of Decisions under sundry tendering procedures in agriculture (milk and milk products) (96/C 246/13) Communication of Decisions under sundry tendering procedures in agriculture (milk and milk products) (96/C 246/12) Standing invitation to tender pursuant to Commission Regulation (EEC) No 570/88 of 16 February 1988 on the sale of butter at reduced prices and the granting of aid for butter and concentrated butter for use in the manufacture of pastry products, ice-cream and other foodstuffs (96/C 246/11) Publication of an application for registration pursuant to Article 6 (2) of Regulation (EEC) No 2081/92 on the protection of geographical indications and designations of origin (96/C 246/10) Publication of an application for registration pursuant to the second subparagraph of Article 8 (1) of Regulation (EEC) No 2082/92 on certificates of specific character (96/C 246/09) Publication of decisions by Member States to grant or revoke operating licenses pursuant to Article 13 (4) of Regulation (EEC) No 2407/92 on licensing of air carriers (1) (96/C 246/08) Publication of decisions by Member States to grant or revoke operating licences pursuant to Article 13 (4) of Regulation (EEC) No 2407/92 on licensing of air carriers (1) (96/C 246/07) Publication of decisions by Member States to grant or revoke operating licences pursuant to Article 13 (4) of Regulation (EEC) No 2407/92 on licensing of air carriers (1) (96/C 246/06) Publication of decisions by Member States to grant or revoke operating licences pursuant to Article 13 (4) of Regulation No 2407/92 on licensing of air carriers (1) (96/C 246/05) Publication of decisions by Member States to grant or revoke operating licences pursuant to Article 13 (4) of Regulation (EEC) No 2407/92 on licensing of air carriers (1) (96/C 246/04) Publication of decisions by Member States to grant or revoke operating licences pursuant to Article 13 (4) of Regulation (EEC) No 2407/92 on licensing of air carriers (1) (96/C 246/03) Communication of Decisions under sundry tendering procedures in agriculture (cereals) (96/C 246/02) Ecu (1) 23 August 1996 (96/C 246/01) END OF DOCUMENT. 3095 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * COMMISSION DECISION of 29 July 1996 in application, at the request of France, of Article 5 (4) of Council Directive 93/75/EEC concerning minimum requirements for vessels bound for or leaving Community ports and carrying dangerous or polluting goods (Only the French text is authentic) (Text with EEA relevance) (96/513/EC) COMMISSION REGULATION (EC) No 1679/96 of 23 August 1996 establishing the standard import values for determining the entry price of certain fruit and vegetables COMMISSION REGULATION (EC) No 1678/96 of 23 August 1996 on the issuing of export licences for products processed from fruit and vegetables COMMISSION REGULATION (EC) No 1677/96 of 23 August 1996 on the issuing of export licences for fruit and vegetables with advance fixing of the refund END OF DOCUMENT. 3096 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * Phare - European Expertise Service Notice of invitation to tender (96/C 245/07) Proposal for a Council Directive amending Directives 71/118/EEC, 72/462/EEC, 85/73/EEC, 91/67/EEC, 91/492/EEC, 91/493/EEC, 92/45/EEC and 92/118/EEC as regards the organization of veterinary checks on products entering the Community from third countries (96/C 245/06) COM(96) 170 final - 96/0110(CNS) Proposal for a Council Directive laying down the principles governing the organization of veterinary checks on products entering the Community from third countries (96/C 245/05) COM(96) 170 final - 96/0109(CNS) Economic outward processing arrangements for textiles (Regulation (EC) No 3017/95) (1) List of the national competent authorities (96/C 245/04) Commission Communication in the framework of the implementation of Council Directive 90/385/EEC of 20 June 1990 in relation to 'active implantable medical devices' (1) and Council Directive 93/42/EEC of 14 June 1993 in relation to 'Medical Devices' (2) (96/C 245/03) Commission Communication in the framework of the implementation of Council Directive 93/42/EEC of 14 June 1993 in relation to 'Medical Devices' (1) (96/C 245/02) Ecu (1) 22 August 1996 (96/C 245/01) END OF DOCUMENT. 3097 !GCAT !GSPO Wasim Akram acclaimed Pakistan as the world's best side and Mushtaq Ahmed as the game's leading spinner on Monday after his side crushed England by nine wickets in the third and final test. Superb wrist spin from Mushtaq, who took six for 78, and skipper Wasim's 300th test wicket helped earn the touring team a 2-0 series margin on a final day at The Oval which had looked set to yield a comfortable draw. "We can take any team in the world right now," said Wasim, reflecting on another England collapse which saw eight wickets fall for 76 runs to a potent mix of pace and spin. "I think we're getting better day by day. The best sides win consistently, and that's what we've done. We have just proved that if we stick together we can beat anyone." Mushtaq, who has now taken 45 wickets in his last six tests, was duly named man of the match as well as Pakistan's player of the series, and Wasim is convinced he deserves the ultimate accolade. "I think he's the best spinner in the world," said Wasim, happy to put his team mate ahead of Shane Warne in the pecking order. "He's getting more wickets, he's got more variety, what more can you ask?" Mushtaq, the architect of England's first test defeat at Lord's where he took five for 57, bowled his leg-spinners unchanged from the Vauxhall End to snare six for 67 in 30 challenging overs. With Wasim and Waqar charging in at the other end, the home side buckled helplessly under the strain and were dismissed soon after tea for 242, leaving Pakistan to rattle up their victory target of 48 in just 6.4 overs. Alec Stewart and Nasser Hussain both made fluent half- centuries, and Michael Atherton resisted for more than three hours for 43. But from the relative comfort of 166 for two, the slide began in remarkably similar fashion to the first test at Lord's. Graham Thorpe edged to Wasim at slip, Hussain was adjudged lbw playing no shot having made 51 off 96 balls and Nick Knight offered a return catch with England still in arrears. Chris Lewis battled it out with John Crawley for half an hour, only to fall lbw to the returning Waqar for four with England just 10 ahead. When Wasim persuaded Crawley to glove a catch to silly point, the lead was still only 25 and the Pakistan captain roared back in after tea to dismiss Robert Croft and Alan Mullally in successive balls, sinking to his knees with arms upraised in ecstacy when his 300th victim finally came. The England management put a brave face on defeat. "We would have expected to draw the two tests we have lost," said coach David Lloyd. "There's strength in the batting, but I'm disappointed we didn't play collectively as a team today." Atherton brushed aside questions about his continued enthusiasm for captaining a losing side and rightly paid tribute to the opposition. "They're a very good side with three match-winning bowlers and a top six who are unorthodox and explosive. "They're up there with anyone, although I think Australia are a little bit ahead. They beat them at home last season but it would be a very good series now." Atherton said it had been "a difficult test match" in the England dressing room, which witnessed Chris Lewis's removal from the one-day squad for disciplinary reasons and several other players learning of they had been dropped during an important test. Wasim said he was "shocked" by the selectors' approach, but also pointed an accusing finger at the English county programme. "They play too much cricket it's a very simple answer," he said. "No human being can bowl for 17 four-day games a season and still bowl quick. "I do feel bad for Michael. I wish him good luck for the Zimababwe tour, but not for the one-dayers." Five months ago angry supporters were calling for Wasim's head after Pakistan's failure to beat India in the World Cup, but he will now be a hero again after presiding over Pakistan's fifth successive series win over England at home and abroad. It is 14 years since England last beat their opponents in a series and, unless they unearth a new crop of test-class bowlers, they may have to wait until well into the next century to end the sequence. 3098 !GCAT !GSPO World champion Michael Schumacher, flush from victory over his Williams rivals in the Belgian Grand Prix, said on Monday he was not letting success go to his head before the Italian Grand Prix in two weeks' time. "We mustn't forget that Williams have almost always been superior this season," said the Ferrari driver. "We'll give it our all, it will be another great battle, but we can't think of going to Monza as absolute favourites," he told reporters at his team's base in northern Italy. The Italian Grand Prix takes place in Monza on September 8. Schumacher upset the odds and the expected duel between the Williams drivers at the Spa-Francorchamps track in Belgium on Sunday for his second victory of the season -- a win he said even he would not have staked money on. The German finished 5.6 seconds ahead of Williams rival Jacques Villeneuve of Canada. Williams' other driver, championship leader Damon Hill of Britain, managed only fifth. Schumacher's victory pushed him up to third in the title race with 39 points although he cannot top either of the Williams' drivers. Hill has 81 points and Villeneuve 68. Schumacher, champion in 1994 and 1995, has recently returned to form after a series of poor results earlier in the season. He is looking for his first victory in his team's home grand prix, where he will drive a more aerodynamic car. "Ferrari will work as hard as possible to win," he said. 3099 !GCAT !GSPO St Helens completed their first league and Challenge Cup double in 30 years on Monday when they thrashed Warrington 66-14 to clinch the inaugural Super League title. St Helens secured the two points they needed in the last game of the season at Knowsley Road to win their first championship since 1975 and their first double since 1966. In rain-soaked conditions, centre Alan Hunte grabbed a hat-trick of tries, while Tommy Martyn, Anthony Sullivan and Paul Newlove each scored two. Captain and goalkicker Bobbie Goulding scored 18 points. St Helens's triumph marked the end of Wigan's seven-year reign as British champions. St Helens needed to win on Monday to take the title -- a defeat or draw would have allowed Wigan their eighth consecutive championship. They were also the toast of London Broncos, who managed to scrape into the top four ahead of Warrington and qualify for the end-of-season play-offs. Bradford finished third. St Helens have now set their sights on taking the treble by winning the end-of-season premiership which begins with next Sunday's semifinal against London. 3100 !GCAT !GSPO Result of the 1,000 Lakes Rally which ended on Monday: 1. Tommi Makinen (Finland) Mitsubishi Lancer 4 hours 4 minutes 13 seconds 2. Juha Kankkunen (Finland) Toyota Celica 46 seconds behind 3. Jarmo Kytolehto (Finland) Ford Escort 2:37 4. Marcus Gronholm (Finland) Toyota Celica 2:42 5. Kenneth Eriksson (Sweden) Subaru Impreza 3:22 6. Thomas Radstrom (Sweden) Toyota Celica 4.09 7. Sebastian Lindholm (Finland) Ford Escort 5:17 8. Lasse Lampi (Finland) Mitsubishi Lancer 12:01 9. Rui Madeira (Portugal) Toyota Celica 16:34 10. Angelo Medeghini (Italy) Subaru Impreza 18:28 3101 !GCAT !GSPO Tommi Makinen took a significant step towards becoming world rally champion with a brilliant victory in the 1000 Lakes Rally on Monday. Mitsubishi driver Makinen stopped experienced fellow Finn Juha Kankkunen in his tracks on the final day of the 1,452-km rally, doubling his lead on the first two decisive stages. "This was the most difficult win - three days at 125 percent effort," said Makinen, whose success completed his 1,000 Lakes hat-trick. Kankkunen was runner-up in his Toyota as Finland's Jarmo Kytolehto produced a remarkable drive to finish third in his Ford. Swede Kenneth Eriksson kept Subaru in the hunt for the manufacturers' title with fifth place in spite of a gearbox problem that nearly forced him off the road close to the end of the event. Maakinen's and Mitsubishi's positions were strengthened by the late retirement of Spain's Carlos Sainz when his Ford gearbox failed. Makinen, with 95 points, now leads his nearest championship rival, Sainz, by 32 points. 3102 !GCAT !GSPO Tommi Makinen of Finland, driving a Mitsubishi, on Monday won the 1,000 Lakes Rally, sixth round of the world championship. 3103 !GCAT !GSPO Jacques Villeneuve flew out of the Spa-Francorchamps circuit by helicopter on Sunday night cursing a radio breakdown which he says cost him a vital victory in the Belgian Grand Prix. The 25-year-old French-Canadian, who was leading Sunday's race when a safety car was introduced after Dutchman Jos Verstappen crashed, could not understand his Williams team's instructions when they called him into the pits. "We lost the race by lack of communications at the moment when the flag came out," he complained later. "We didn't understand what we were saying to each other." As a result of the misunderstanding, Villeneuve stayed on the track behind the pace car while world champion Michael Schumacher drove into the Ferrari pits for a quick tyre and fuel stop which gave him a decisive tactical advantage. The German went on to clinch his third victory in five years at Spa-Francorchamps. Villeneuve finished second but said he was disappointed not to have collected the 10 points needed to cut more deeply into team mate Damon Hill's lead in the title race. Hill, who finished fifth, now leads by 13 points with three races remaining. "It was a good opportunity to put up a lot of points against Damon, so in that respect I am disappointed," Villeneuve said. He pointed out that beating Hill into second place in the last three Grands Prix would not be enough to secure him the drivers' title. "We need to beat Damon by more than that and it's going to have to be a six-point gain at one of the races. I am obviously very happy about today's race because the car was very strong and we only lost because of the pitstop. It's a disappointing way to lose but it's as fair as any other." Hill and Villeneuve may now find their private Williams duel for the crown could, ironically, be settled by a Ferrari revival at Monza in next month's Italian Grand Prix. Double world champion Schumacher, driving for Ferrari, hinted as much after Sunday's race, in which Mika Hakkinen of Finland finished a strong third for McLaren to prove his team will also play a part in the run-in. Asked if he felt Ferrari could win in Italy, Schumacher said: "Our car has always worked well (at Monza) in all our tests but it is difficult to predict our rivals' performance levels. "It would be nice to help Damon or Jacques win the title, too, and a bit unusual for me. I don't mind which of them wins it so long as Ferrari wins." If Schumacher maintains his and Ferrari's good form it would clearly help Hill clinch the championship, but the German jokingly told Villeneuve he was prepared to help him win the title at the right price. "How much would it cost?" the 27-year-old German asked. "Let's talk about that later," replied Villeneuve, somewhat flustered by the question, but aware that Schumacher could well dictate the outcome of the title race. Hill, disappointed at the outcome of what he described as "an interesting race" knows one big win over his team mate would virtually seal the championship title. "I was relieved to get some points," he admitted. "They could be crucial." 3104 !GCAT !GSPO A goal each from new signings Jordi Cruyff and Ole Gunnar Solskjaer allowed premier league champions Manchester United to come twice from behind and force a 2-2 draw with 1995 champions Blackburn Rovers at Old Trafford on Sunday. Blackburn, still smarting from the pre-season loss of England striker Alan Shearer to Newcastle United and the departure last week of director of football Kenny Dalglish, deserved their share of the points as they took the game to the champions. Paul Warhurst put Blackburn ahead after 34 minutes but a mistake by centre-back Colin Hendry five minutes later allowed Dutch international Cruyff to steal in for the equaliser as he scored his second goal of the season. After a penalty appeal was turned down, Blackburn reclaimed the lead six minutes into the second half through Norwegian Lars Bohinan. But Manchester United pressed forward and the Norwegian Solksjaer, in his first game for the club, squared the match seven minutes after coming on as a 63rd minute substitute. 251743 GMT aug 96 3105 !GCAT !GSPO Tiger Woods defeated Steve Scott on the second hole of a sudden-death playoff for a record third consecutive U.S. Amateur Golf Championship on Sunday. Woods never led until sinking a short par putt after Scott had missed a seven-footer on the 10th hole -- the 38th of the day and 164th of the week-long tournament. Woods trailed by as many as five holes in the 36-hole match-play final and by two holes with just three to play. Woods became the first golfer to win the U.S. Amateur title in three straight years. He also won U.S. Junior Amateurs in 1991, 1992 and 1993 and joined the legendary Bobby Jones as the only golfers to win USGA events in six straight years. Jones won the U.S. Amateur or U.S. Open in every year from 1923 to 1930. With nearly no margin for error, Woods birdied the 16th and 17th holes, rolling in a 30-foot putt on 17 to square the match. After both players parred the first playoff hole, Woods hit a six-iron on the 204-yard 10th hole within eight feet of the cup. Scott missed the green and rolled his chip attempt past the hole. Woods missed badly on his birdie, but Scott lipped his par putt. The 20-year-old Woods tapped in for the gut-wrenching win. Woods receives automatic entry into next year's Masters and U.S. Open, if he is still an amateur. The Stanford student intends to play in next week's Greater Milwaukee Open as an amateur and has said he will turn pro if he wins the event. Woods defeated Stanford University teammate Joel Kribel, 3 and 1, in Saturday's semifinals. Scott posted a 3 and 2 victory over Robert Floyd, the son of Senior PGA Tour mainstay Raymond Floyd, in a battle of University of Florida teammates. 3106 !GCAT !GSPO Winger Lee Sharpe hit a superb strike from the edge of the penalty area to give Leeds their first win of the season on Monday and leave hapless Wimbledon anchored at the bottom of the England premier league. Sharpe repaid a huge slice of the 4.5 million pound ($6.98 million) fee Leeds handed Manchester United for his services with a top-draw second-half goal to hand Wimbledon their third successive defeat. Ian Rush, the Welsh striker signed from Liverpool in the close season, set up the goal, feeding Sharpe as he galloped forward and the former England winger cut inside onto his unfavoured right foot to arc a shot into the right-hand corner of the net. The only goal of the match also brought some relief for under-fire Leeds manager Howard Wilkinson following the team's poor start to the season. Home fans frequently booed their own side until Sharpe turned the jeers to cheers. 3107 !GCAT !GSPO Summary of Monday's English premier league soccer match: Leeds 1 (Sharpe 58th minute) Wimbledon 0. Halftime 0-0. Attendance 25,860. 3108 !GCAT !GSPO Result of an English premier league soccer match on Monday: Leeds 1 Wimbledon 0 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Sheffield Wednesday 3 3 0 0 6 2 9 Chelsea 3 2 1 0 3 0 7 Arsenal 3 2 0 1 4 2 6 Aston Villa 3 2 0 1 4 2 6 Manchester United 3 1 2 0 7 4 5 Sunderland 3 1 2 0 4 1 5 Liverpool 3 1 2 0 5 3 5 Everton 3 1 2 0 4 2 5 Tottenham 3 1 2 0 3 1 5 Nottingham Forest 3 1 1 1 5 5 4 Leeds 3 1 1 1 4 5 4 West Ham 3 1 1 1 3 4 4 Leicester 3 1 1 1 2 3 4 Newcastle 3 1 0 2 3 4 3 Middlesbrough 3 0 2 1 4 5 2 Derby 3 0 2 1 4 6 2 Southampton 3 0 1 2 2 4 1 Blackburn 3 0 1 2 2 5 1 Coventry 3 0 1 2 1 6 1 Wimbledon 3 0 0 3 0 6 0 3109 !GCAT !GSPO Essex took over at the top of the English county championship table on Monday thanks to a comfortable win at Gloucestershire and bad weather that ensured all their rivals fell short of victory. Neil Williams wasted little time in clinching Essex's innings and 64-run success. The 34-year-old paceman took five for 43 to help dismiss Gloucestershire for 188 after they had resumed their second innings on 27 for four. Kent were forced to settle for second spot despite a declaration and double forfeiture that left Glamorgan a target for 324 runs for victory at rain-washed Cardiff. Glamorgan forfeited their first innings and Kent their second to leave the prospect of a result open. Glamorgan had reached 273 for five when play was stopped. Leicestershire would have overtaken them both at the top if they could have completed an unlikely victory over Hampshire at Grace Road. After the loss of a day-and-a-half's play Leicestershire needed to take 13 wickets to force victory. Starting the day at 81 for seven Hampshire were dismissed for 137 to follow on 216 behind. That left Leicestershire two sessions and 45 minutes to wrap up the second innings. But they were interrupted four times by the rain and those lost 23 overs finally denied them a return to the top as Hampshire held on to reach the close at 135 for nine. Surrey also had to settle for a draw at Trent Bridge, where their run chase against Nottinghamshire was washed out by heavy rain. After several interruptions, Surrey were set 319 for victory from a minimum of 59 overs when play eventually resumed in the early afternoon. Darren Bicknell hammered an unbeaten 30 as Surrey rattled along at more than four an over to underline their intentions. But after 12.5 overs and having reached 53 without loss, the rain arrived leaving the umpires with little alternative but to abandon play. Darren Gough responded to his England recall for the one-day series against Pakistan by producing his best county bowling figures for three years. But his match return of eight for 33 was not quite enough to give Yorkshire victory as rain allowed Lancashire to hang on for a draw. Only 13 overs were possible on the last day, during which Lancashire lost two more second innings wickets to stand at 231 for seven with a slim lead of 25 runs before play was abandoned. Warwickshire's chance of retaining the title were all but dashed after Worcestershire held on for a draw at New Road. Set to make 268 in 54 overs, Worcestershire lost 36 minutes because of rain and finished on 164 for four after a century opening stand by Tim Curtis (44) and Philip Weston (52). 3110 !GCAT !GSPO Wasim Akram's three-wicket haul for Pakistan in England's second innings at The Oval on Monday gave him his 300th test match wicket. Wasim becomes the 11th player to join the 300-club of bowlers and the second Pakistani, after Imran Khan, to achieve the feat. Other cricketers who have taken over 300 Test wickets: Kapil Dev (India) 434 wickets, 131 Tests Richard Hadlee (New Zealand) 431, 86 Ian Botham (England) 383, 102 Malcolm Marshall (West Indies) 376, 81 Imran Khan (Pakistan) 362, 88 Dennis Lillee (Australia) 355, 70 Bob Willis (England) 325, 90 Lance Gibbs (West Indies) 309, 79 Fred Trueman (England) 307, 67 Courtney Walsh (West Indies) 309, 82 Wasim Akram (Pakistan) 300, 70 3111 !GCAT !GSPO English County Championship cricket standings after Monday's matches (tabulated under played, won, lost, drawn, batting bonus points, bowling bonus points, total points): Essex 13 7 2 4 45 43 212 Kent 14 7 1 6 42 40 212 Derbyshire 13 7 2 4 41 43 208 Leicestershire 13 6 1 6 43 45 202 Surrey 13 6 1 6 37 48 199 Yorkshire 14 6 5 3 41 46 192 Warwickshire 13 6 4 3 32 43 180 Middlesex 13 5 5 3 26 45 160 Sussex 13 5 6 2 27 43 156 Somerset 13 4 5 4 27 49 152 Worcestershire 13 3 3 7 33 48 150 Glamorgan 13 4 5 4 36 32 144 Hampshire 13 3 5 5 28 46 137 Gloucestershire 14 3 6 5 19 47 129 Northamptonshire 13 2 6 5 30 43 120 Lancashire 13 1 4 8 38 37 115 Nottinghamshire 13 1 6 6 34 40 108 Durham 14 0 9 5 22 50 87 3112 !GCAT !GSPO World championship-leading Briton Damon Hill was again linked to a switch of teams from Williams to McLaren on Monday after the Mercedes-Benz-powered outfit announced a massive new sponsorship deal. McLaren said they would be severing their 23-year relationship with Marlboro at the end of the season and had agreed a five-year deal, said to be worth around 125 million pounds ($194.2 million), from the owners of the German cigarette brand West. Hill, who leads this year's drivers' championship by 13 points, is a free agent at the end of the season and is considering leaving Williams if he cannot reach a satisfactory agreement with the team. In the past, Williams have failed to keep several drivers who have won championships with them including Brazilian Nelson Piquet in 1987, Briton Nigel Mansell in 1992 and Frenchman Alain Prost in 1993. Hill was team mate to Prost, a four-times champion, in 1993 and the two worked well together and became friends. Prost, now with McLaren as a technical adviser, is known to be an admirer of Hill and believes he is underrated. McLaren boss Ron Dennis has refused to deny he is interested in Hill, but would say only that his driver line-up next season would be "David Coulthard and the best available driver in the opinion of McLaren and Mercedes-Benz". Hill is known to have met Dennis during a holiday in the south of France recently and it is believed he has also begun talks with at least two other teams. Hill could clinch his first drivers' championship at the Italian Grand Prix at Monza on September 8 should he win and team mate Jacques Villeneuve fail to finish. He could then negotiate his future from a position of strength. 3113 !GCAT !GSPO Results on the final day of four-day English County Championship cricket matches on Monday: At Colchester: Essex beat Gloucestershire by an innings and 64 runs. Gloucestershire 280 and 188 (J.Russell 57, M.Lynch 50; N.Williams 5-43). Essex 532-8 declared (G.Gooch 111, R.Irani 91, P.Prichard 88, D.Robinson 72; M.Alleyne 4-80). Essex 24 points, Gloucestershire 3. At Cardiff: Match drawn. Kent 323-5 declared (C.Hooper 77, D.Fulton 64, N.Llong 63, M.Walker 59) and second innings forfeited. Glamorgan first innings forfeited and 273-5 (H.Morris 118, A.Cottey 70). Glamorgan 5 points, Kent 6. At Northampton: Northamptonshire beat Sussex by 6 wickets. Sussex 389 and 112. Northamptonshire 361 and 142-4. Northamptonshire 24 points, Sussex 8. At Trent Bridge: Match abandoned as a draw - rain. Nottinghamshire 446-9 declared and 53-0. Surrey 128-4 declared (A.Brown 56 not out). Nottinghamshire 8 points, Surrey 7. At Worcester: Match drawn. Warwickshire 310 and 162-4 declared. Worcestershire 205-9 declared (K.Spiring 52; A.Giles 3-12) and 164-4 (P.Weston 52). Worcestershire 8 points, Warwickshire 10. At Headingley: Match drawn. Yorkshire 529-8 declared (C.White 181, R.Blakey 109 not out, M.Moxon 66, M.Vaughan 57). Lancashire 323 (N.Fairbrother 86, M.Watkinson 64; D.Gough 4-53) and 231-7 (N.Speak 77, N.Fairbrother 55; D.Gough 4-48). Yorkshire 11 points, Lancashire 8. At Leicester: Match drawn. Leicestershire 353. Hampshire 137 (G.Parsons 4-36) and 135-9. Leicestershire 11 points, Hampshire 7. 3114 !GCAT !GSPO One of Formula One motor racing's longest and most successful partnerships is to end with McLaren switching sponsors and cigarette brands at the end of the year. A statement by McLaren on Monday said they were ending their ties with Malboro and from 1997 would be backed by the West cigarette brand, owned by the German company Reemtsma. McLaren have been virtually synonymous with Marlboro since 1974, winning nine drivers' world titles and seven constructors' titles in that period, but the relationship will end with the last race of the season in Japan in October. McLaren are currently powered by Germany's Mercedes-Benz engines and the sponsorship switch is expected to be accompanied by a change in livery from the familiar red-and-white to something close to all-silver in what may be a reincarnation of the famous Mercedes-Benz 'silver arrows' of the 1950's. McLaren said they had agreed a five-year deal with Reemtsma and the team would be known as the West McLaren Mercedes Formula One team. Motor racing sources said the deal was agreed after Marlboro wanted to reduce their backing from a reported $40 million a year. Marlboro are expected to carry on sponsoring Ferrari as their chief marketing outlet in Formula One next season and to remain involved in the promotion of several Grands Prix. 3115 !GCAT !GSPO Mushtaq Ahmed and Wasim Akram confirmed their status as two of the world's great match-winning bowlers on Monday by hustling Pakistan to a convincing 2-0 series victory over England at The Oval. The home side buckled helplessly under the strain on the final afternoon as they were bowled out for 242, leaving Pakistan to score just 48 runs to complete a nine-wicket win with a possible 23.2 overs to spare. Mushtaq, the architect of England's first test defeat at Lord's, bowled his wrist spinners unchanged from the Vauxhall End to finish with figures of six for 78, with Wasim slicing through the tail to join one of test cricket's most exclusive clubs. His three for 67 made him only the 11th bowler in test history to reach 300 wickets, a fitting personal reward for a captain whose team have set impressive standards throughout their all-conquering tour. Five months ago angry supporters were besieging Wasim's home after Pakistan's quarter-final defeat to India in the World Cup. Now he is a hero again after presiding over Pakistan's fifth successive series win over England at home and abroad. England last beat their opponents in a series in 1982. Wasim paid tribute to Mushtaq, praising him as "the best spinner in the world". "Each individual really fought well today," he said. "The boys have really made me proud." The irrepressible Mushtaq was named man-of-the-match as well as Pakistan's man-of-the-series and England could claim that without him the margin would have been less pronounced. He took five for 57 as England spiralled to defeat at Lord's, losing their last nine wickets for 75, and repeated the trick on his return to London, taking six for 67 in an unbroken 30-over spell to delight any purist. England thought they had suffered enough against the leg- spin of Shane Warne, but Wasim claimed Mushtaq, who has now taken 45 wickets in his last six tests, was bowling even better than the Australian. "He's getting better day by day...I think he's the best spinner in the world," said Wasim. "He's got more variety than Shane Warne." Wasim suggested Pakistan's bowlers "have done the boys really proud" but there are few weak links in a team who have not always bonded so successfully. "We have just proved that if we stick together we can beat any team in the world," he said. Even when England were 166 for two in early afternoon, the Pakistanis still refused to settle for the easy option of a draw with victory in the series already assured. Their last eight wickets went down for 76 runs, the bubbling Mushtaq making the initial inroads before Waqar and Wasim Akram returned with the ageing ball. Despite losing Alec Stewart and Michael Atherton to bat-pad catches before lunch for 54 and 43 respectively, England must have felt they were out of serious bother as they moved within 30 runs of Pakistan with eight wickets in hand. But Thorpe edged a good ball to Wasim at slip, Hussain was adjudged lbw playing no shot having made 51 off 96 balls and Nick Knight offered a return catch with England still in arrears. At 187 for five, with a worn ball available for the Pakistan pace attack, it offered a real challenge for Chris Lewis, seeking to restore his reputation after being axed from his country's one-day squad for poor timekeeping. He battled it out with John Crawley for half an hour, only to fall lbw to the returning Waqar for four with England just 10 ahead. When Wasim persuaded John Crawley to glove a catch to silly point, the lead was still only 25 and the Pakistan captain roared back in after tea to dismiss Robert Croft and Alan Mullally in successive balls to spark a miniature pitch invasion. The Pakistani fans clearly thought it was all over and, after 6.4 overs, it duly was. 3116 !GCAT !GSPO Pakistan beat England by nine wickets on the fifth day of the third and final test at The Oval on Monday to win the series 2-0. Scores: England 326 and 242; Pakistan 521-8 declared and 48-1. 3117 !GCAT !GSPO Scoreboard on the last day of the third and final test between England and Pakistan at the Oval on Monday: England first innings 326 (J.Crawley 106, G.Thorpe 54; Waqar Younis 4-95) Pakistan first innings 521-8 declared (Saeed Anwar 176, Salim Malik 100 not out, Ijaz Ahmed 61) England second innings (overnight 74-0) M.Atherton c Inzamam-ul-Haq b Mushtaq Ahmed 43 A.Stewart c Asif Mujtaba b Mushtaq Ahmed 54 N.Hussain lbw b Mushtaq Ahmed 51 G.Thorpe c Wasim Akram b Mushtaq Ahmed 9 J.Crawley c Aamir Sohail b Wasim Akram 19 N.Knight c and b Mushtaq Ahmed 8 C.Lewis lbw b Waqar Younis 4 D.Cork b Mushtaq Ahmed 26 R.Croft c Ijaz Ahmed b Wasim Akram 6 I.Salisbury not out 0 A.Mullally b Wasim Akram 0 Extras (b-6 lb-2 w-1 nb-13) 22 Total 242 Fall of wickets: 1-96 2-136 3-166 4-179 5-187 6-205 7-220 8-238 9-242 Bowling: Wasim Akram 15.4-1-67-3, Waqar Younis 18-3-55-1, Mushtaq Ahmed 37-10-78-6, Aamir Sohail 2-1-4-0, Mohammad Akram 10-3-30-0 Pakistan second innings Saeed Anwar c Knight b Mullally 1 Aamir Sohail not out 29 Ijaz Ahmed not out 13 Extras (nb-5) 5 Total (for one wicket) 48 Fall of wicket: 1-7 Bowling: Cork 3-0-15-0, Mullally 3-0-24-1, Croft 0.4-0-9-0 Result: Pakistan won by 9 wickets First test: Lord's - Pakistan won by 164 runs Second test: Headingley - Drawn Pakistan win series 2-0 3118 !GCAT !GSPO England were dismissed for 242 in their second innings on the fifth day of the third and final test at The Oval on Monday leaving Pakistan requiring 48 runs to win. Pakistan lead the series 1-0. 3119 !GCAT !GSPO Result of a European Super League rugby league match on Monday: St Helens 66 Warrington 14 Final standings (tabulated under played, won, drawn, lost, points for, against, total points): St Helens 22 20 0 2 950 455 40 - champions Wigan 22 19 1 2 902 326 39 Bradford 22 17 0 5 767 409 34 London 22 12 1 9 611 462 25 Warrington 22 12 0 10 569 565 24 Halifax 22 10 1 11 667 576 21 Sheffield 22 10 0 12 599 730 20 Oldham 22 9 1 12 473 681 19 Castleford 22 9 0 13 548 599 18 Leeds 22 6 0 16 555 745 12 Paris 22 3 1 18 398 795 7 Workington 22 2 1 19 325 1021 5 3120 !GCAT !GSPO Mushtaq Ahmed masterminded a dramatic England collapse at The Oval on Monday as Pakistan refused to settle for the easy option of a draw on the final day of the third test. The bustling leg-spinner had collected five England wickets for 69 at tea as the home side stumbled to 227 for seven, a mere 32 ahead with one session to play. England, already 1-0 down and heading for defeat in the three-test series, lost five wickets for 54 runs in mid- afternoon as they scrambled to overhaul Pakistan's first innings lead of 195. The bubbling Mushtaq, bowling unchanged from the Vauxhall End, made the initial inroads, turning the ball a long way and appealing with all his customary zest, before Waqar Younis and Wasim Akram returned to grab a further wicket apiece before tea. Despite losing Alec Stewart and Michael Atherton to bat-pad catches before lunch for 54 and 43 respectively, England must have felt they were out of serious bother at 166 for two with Nasser Hussain in excellent form. They reckoned without Mushtaq's tenacity. Thorpe edged a good ball to Wasim at slip, Hussain was adjudged lbw playing no shot having made 51 off 96 balls and Nick Knight offered a return catch with England still in arrears. At 187 for five, with a worn ball available for the Pakistan pace attack, it offered a real challenge for Chris Lewis, seeking to restore his reputation after being axed from his country's one-day squad for poor timekeeping. He battled it out with John Crawley for half an hour, only to fall lbw to the returning Waqar Younis for four with England just 10 ahead. When Wasim persuaded John Crawley to glove a catch to silly point, the lead was still only 25 with a 2-0 winning margin still a Pakistan target. 3121 !GCAT !GSPO Mushtaq Ahmed kept alive Pakistan's hopes of a 2-0 series margin with two valuable English wickets on the final day of the third test at The Oval on Monday. The leg-spinner had both Alec Stewart and Michael Atherton caught off bat-and-pad in the morning session as England's second innings reached 158 for two at lunch, still 37 runs behind. It will still require a dramatic collapse on a flat pitch for Pakistan to end the series in style, but the removal of the home side's most durable batsmen ensured they could not relax totally at the interval. Stewart was well taken at short leg by a diving Asif Mujtaba for 54, including seven fours, and Atherton's resolute innings spanning over three hours ended on 43 when he was caught by Inzamam-ul-Haq fielding close on the off-side. The England captain had been very fortunate to escape an lbw shout from Waqar Younis on 28, but again dealt capably with the faster bowlers without setting the scoreboard alight. Nasser Hussain played with freedom to be 41 not out at the interval, his most awkward moment coming when Wasim Akram struck him on the upper body with a short ball on 13. Wasim again bowled with pace and cunning but could still not locate the three victims he needs to become only the 11th man to take 300 test wickets. 3122 !GCAT !GSPO Coach Gerard Gili again insisted his Marseille side will be nothing more than also-rans this season after they slumped to their first defeat since rejoining the French first division. "We're just a newly promoted side," he said, pouring cold water on the huge expectations surrounding the former European champions' return from the wilderness of division two. Marseille lost 2-1 at home to Metz on Saturday and face another test of their ability to shine when they meet defending champions Auxerre on Tuesday. "The first division is not the second division," stressed defender Jean-Philippe Marquet, who joined Marseille two years ago when they were first relegated for off-the-pitch problems. Recent arrivals Iordan Lechkov of Bulgaria, French international Reynald Pedros and Italians Alberto Malusci and Ivan Franceschini appear not to have settled yet. "We ended our recruiting very late and now we're paying the price," said Gili, determined his side should not be regarded among the favourites for the league title. Auxerre had to settle for a goalless draw at Bordeaux and lost touch with runaway leaders Lens, who won 1-0 at Nantes to ensure they travel to Montpellier on Wednesday with a perfect nine points out of nine. In Germany the only side with a comparable three wins from three are Cologne, who last won a championship in 1978 and spent most of last season staving off relegation. They now find themselves top of the first division for the first time since 1989, and have every chance of maintaining their 100 percent record when they entertain Hansa Rostock, with just one point in the bag so far, on Tuesday. Bayer Leverkusen's early high-scoring was cut short by Fortuna Duesseldorf, who clung onto a 1-0 lead by packing their defence, to the annoyance of Leverkusen trainer Christoph Daum, who takes his side to Bayern Munich on Wednesday. "Things will definitely be better in the Olympic Stadium," Daum said. "Unlike Duesseldorf, Bayern, with (Juergen) Klinsmann are interested in playing football, and that will give us chances of our own to make up for Saturday." Bayern president Franz Beckenbauer, whose side won 4-0 at Duisburg on Sunday, is not underestimating sixth-placed Bayer Leverkusen, the surprise team of the season. "This will be the first real test of the season of how the Bundesliga is going to go," he said. Further south, the Italians and Spaniards have yet to start. Serie A kicks off on September 8 with defending champions Milan at home to Verona and European champions Juventus away at Reggiana. In Spain, last season's league and cup double winners Atletico Madrid begin the defence of the championship at home to Celta of Vigo on September 1. 3123 !GCAT !GSPO Leading world golf rankings issued on Monday (U.S. unless stated): 1. Greg Norman (Australia) 10.21 points average 2. Colin Montgomerie (Britain) 8.85 3. Ernie Els (South Africa) 8.81 4. Nick Faldo (Britain) 8.73 5. Tom Lehman 8.69 6. Masashi Ozaki (Japan) 8.53 7. Fred Couples 8.19 8. Corey Pavin 8.04 9. Phil Mickelson 8.41 10. Mark O'Meara 7.09 11. Nick Price (Zimbabwe) 6.91 12. Bernhard Langer (Germany) 6.78 13. Steve Elkington (Australia) 6.57 14. Davis Love III 6.47 15. Scott Hoch 5.85 16. Mark McCumber 5.79 17. Vijay Singh (Fiji) 5.49 18. Loren Roberts 5.21 19. David Duval 5.15 20. Steve Stricker 5.12 3124 !GCAT !GSPO English and Scottish league soccer fixtures for August 30 to September 1: Friday, August 30: English division one - West Bromwich v Sheffield United. English division three - Swansea v Lincoln. Saturday, August 31: English division one - Birmingham v Barnsley, Bradford v Tranmere, Grimsby v Portsmouth, Huddersfield v Crystal Palace, Manchester City v Charlton, Norwich v Wolverhampton, Oldham v Ipswich, Port Vale v Oxford, Reading v Stoke, Southend v Swindon. English division two - Blackpool v Wycombe, Bournemouth v Peterborough, Bristol Rovers v Stockport, Bury v Bristol City, Crewe v Watford, Gillingham v Chesterfield, Luton v Rotherham, Millwall v Burnley, Notts County v York, Plymouth v Preston, Shrewsbury v Brentford, Walsall v Wrexham. English division three - Brighton v Scunthorpe, Cambridge v Cardiff, Colchester v Hereford, Doncaster v Darlington, Fulham v Carlisle, Hull v Barnet, Leyton Orient v Hartlepool, Mansfield v Rochdale, Scarborough v Northampton, Torquay v Exeter, Wigan v Chester. Scottish division one - East Fife v Clydebank, Greenock Morton v Falkir, Partick v St Mirren, St Johnstone v Airdrieonians, Stirling v Dundee. Scottish division two - Ayr v Berwick, Clyde v Queen of the South, Dumbarton v Brechin, Livingston v Hamilton, Stenhousemuir v Stranraer. Scottish division three - Albion v Cowdenbeath, Arbroath v East Stirling, Inverness v Alloa, Montrose v Ross County, Queen's Park v Forfar. Sunday, September 1: English division one - Queens Park Rangers v Bolton. 3125 !GCAT !GSPO South Africa recalled lock Steve Atherton to their squad on Monday for the third and final test against New Zealand at Ellis Park on Saturday. The Natal player replaces Hannes Strydom, who suffered medial knee ligament damage in Saturday's 33-26 defeat against the All Blacks in the second test in Pretoria. Hooker Henry Tromp, who injured a shoulder in that setback, remains in the squad although a replacement may be called up later in the week. South Africa have already lost the series -- they trail 2-0 -- and face a 1996 whitewash following two defeats by the New Zealanders in the earlier Tri-Nation series. Squad: Andre Joubert, Justin Swart, Andre Snyman, Danie van Schalkwyk, Pieter Hendriks, Joel Stransky, Joost van der Westhuizen, Gary Teichmann (captain), Andre Venter, Ruben Kruger, Steve Atherton, Mark Andrews, Marius Hurter, Henry Tromp, Os du Randt, Wayn Fyvie, Kobus Wiese, James Dalton, Dawie Theron, Henry Honiball, Johan Roux, Japie Mulder, Vlok Cilliers. 3126 !GCAT !GSPO Costa Rica and Chile drew 1-1 (halftime 1-0) in a friendly soccer international on Sunday. Scorers: Costa Rica - Ronaldo Gonzalez (10th minute, penalty Chile - Marcelo Salas (80th) Attendance: 8,000 3127 !GCAT !GSPO The tiny islands of the Seychelles failed to make soccer history at the weekend when they bowed out of the preliminary rounds of the African Nations Cup. Trailing fellow Indian Ocean islanders Mauritius 1-0 from the first leg, they were held to a 1-1 draw at home on Saturday despite playing against 10 men for most of the match. The 2-1 aggregate took Mauritius into the group phase of the qualifiers for the 1998 finals, and kept up the Seychelles' record of never having won an official match in their 10 years of FIFA membership. The Seychelles must have thought they were on course for a historic breakthrough when Mauritian midfielder Andre Caboche was sent off for a crude tackle in the 19th minute. But the visitors responded to the setback immediately -- veteran striker Ashley Mocude scoring a minute later to give them a two-goal aggregate lead. Although Danny Rose's 50th-minute equaliser gave the Seychellois renewed hope they could not find the net again and were eliminated. Mauritius now play in group seven of the qualifiers against Malawi, Mozambique and favourites Zambia. Namibia, who drew 0-0 with Botswana in their first leg, won the second leg in Windhoek 6-0 to stretch their unbeaten run to eight matches and continue their remarkable progress on the African soccer stage. They now play in group five with Cameroon, Gabon and Kenya. German-based striker Bachirou Salou returned home to Togo to score the decisive only goal of their tie against Congo. Salou, who plays for MSV Duisburg in the Bundesliga, scored in the 53rd minute of Sunday's match in Lome for a 1-0 aggregate win which takes his side into group six, where they will meet Liberia, Tanzania and Zaire. Ethiopia needed a penalty shoot-out in Addis Ababa to overcome Uganda after a 2-2 aggregate scoreline. Both legs ended 1-1 before Ethiopia won the spot kick decider 4-2. Uganda's elimination follows their humiliating 5-1 aggregate defeat by Angola in June's World Cup qualifying preliminaries. The other preliminary round second leg match, between Mauritania and Benin in Nouakchott, was postponed until Friday. Benin won the first leg 4-1. 3128 !GCAT !GSPO Collated results of African Nations Cup preliminary round, second leg matches played at the weekend: Ethiopia 1 Uganda 1 2-2 on aggregate. Ethiopia win 4-2 on penalties Mauritania v Benin postponed to Friday Benin lead 4-1 from the first leg Namibia 6 Botswana 0 Namibia win 6-0 on aggregate Seychelles 1 Mauritius 1 Mauritius win 2-1 on aggregate Togo 1 Congo 0 Togo win 1-0 on aggregaete Central African Republic walkover v Burundi Winners progress to qualifying groups to start in October. 3129 !GCAT !GSPO Results of Ukraine premier division matches played at the weekend: Dynamo Kiev 5 Kremin Kremenchuk 0 Vorskla Poltava 2 Nyva Ternopil 1 Torpedo Zaporizhya 2 Shakhtar Donetsk 1 Kryvbas Kryvy Rig 1 Karpaty Lviv 2 Prykarpattya Ivano-Frankivsk 0 Zirka-Nibas Kirovohrad 0 Chornomorets Odessa 2 Metalurg Zaporizhya 1 Dnipro Dnipropetrovsk 2 CSKA Kiev 1 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Dynamo 6 5 0 1 16 2 15 Vorskla 6 4 2 0 11 3 14 Dnipro 6 4 1 1 13 6 13 Chornomorets 6 4 1 1 11 7 13 Shakhtar 6 3 2 1 10 3 11 Metalurg 6 3 2 1 9 6 11 Karpaty 6 3 1 2 9 5 10 Zirka-Nibas 6 3 1 2 6 8 10 Torpedo 6 3 1 2 8 7 10 Tavria 5 2 0 3 3 7 6 Nyva Ternopil 6 2 0 4 4 11 6 CSKA 6 1 1 4 4 7 4 Kryvbas 6 1 1 4 5 9 4 Nyva Vinnytsya 5 0 2 3 1 7 2 Prykarpattya 6 0 2 4 4 13 2 Kremin 6 0 1 5 1 14 1 3130 !GCAT !GSPO Injury has ruled English-based forwards Valeriu Raducioiu and Ilie Dumitrescu out of Saturday's World Cup qualifier against Lithuania, Romania's national soccer trainer Anghel Iordanescu said. "The national team needed Raducioiu and Dumitrescu but they are recovering from injuries and are not in good health for an important game," Iordanescu told Reuters. Both men play for West Ham in the English premier league and are among 11 foreign-based players in the squad for Romania's first qualifying match for the 1998 World Cup in France. Steaua Bucharest veteran Marius Lacatus, whose team qualified for the European Cup Champions' League last week, is also injured and will miss the home game. Five other Steaua players, including rising star Adrian Ilie, who scored four of his team's five goals in their European Cup preliminary round defeat of Belgium's FC Bruges, have been called up. "Romania cannot allow themselves the tiniest wrong step versus any other team in the qualifying group," Iordanescu said. The other teams are Ireland, Iceland, Lithuania, Macedonia and Liechtenstein. Only one team goes through. Squad: Goalkeepers - Florin Prunea, Daniel Gherasim Defenders - Dan Petrescu, Iulian Filipescu, Daniel Prodan, Tiberiu Curt, Cornel Papura, Tibor Selymess Midfielders - Dorinel Munteanu, Gheorghe Hagi, Gheorghe Popescu, Ionut Lupescu, Costel Galca, Ovidiu Stanga, Gabriel Popescu Forwards - Viorel Moldovan, Adrian Ilie, Gheorghe Craioveanu, Radu Niculescu. 3131 !GCAT !GSPO Bulgaria's new coach Hristo Bonev said on Monday he would change his tactics rather than his team for the World Cup qualifier against Israel on September 1. "There is no time for any big changes but there will be changes in the way of playing," Bonev told a news conference, without giving details. Bonev, who brought the squad together for training earlier on Monday, said he was still expecting volatile Barcelona striker Hristo Stoichkov to join the squad, despite his vow to quit the national team in a dispute with officials. "After watching the Spanish Supercup game between Barcelona and Atletico last night I think that it will be a plus for Stoichkov if he joins the national team," Bonev said. Stoichkov, who played in Barcelona's 5-2 win over Atletico Madrid, has accused the soccer union's chiefs of cheating the players, and last month demanded their resignation. Bonev was named as manager last month after Dimitar Penev was sacked following Bulgaria's poor showing in the European championship in June. Most of the foreign-based players named in the squad are expected to arrive in Sofia on Tuesday and Wednesday, among them, Krasimir Balakov, who plays for VfB Stuttgart in Germany, and Yordan Lechkov from France's Marseille. The Bulgarian party is due to leave for Tel Aviv on Friday. 3132 !GCAT !GSPO Romania's national soccer trainer Anghel Iordanescu said injury had ruled West Ham forwards Valeriu Raducioiu and Ilie Dumitrescu out of Saturday's World Cup qualifier against Lithuania. "The national team needed Raducioiu and Dumitrescu but they are recovering from injuries and are not in good health for an important game," Iordanescu told Reuters on Sunday. Steaua Bucharest's veteran Marius Lacatus, who qualified with his team last week for the Champions League, is also injured and will miss the game. Five other Steaua players -- including rising star Adrian Ilie, who scored four out of five goals in the Champions League preliminary round defeat of FC Bruges -- were called up to face the Lithuanians. Iordanescu also named 11 Romanians playing abroad for the squad he hopes will give the Balkan country a good start in their campaign to reach the World Cup finals in 1998 in France. "Romania cannot allow itself the tiniest wrong step versus any other team in the qualifying group," he said. Romania's group for the World Cup qualifiers includes Ireland, Iceland, Lithuania, Macedonia and Liechtenstein. Only one team goes through. Romania's squad: Florin Prunea, Daniel Gherasim - goalkeepers; Dan Petrescu, Iulian Filipescu, Daniel Prodan, Tiberiu Curt, Cornel Papura, Tibor Selymess - defenders; Dorinel Munteanu, Gheorghe Hagi, Gheorghe Popescu, Ionut Lupescu, Costel Galca, Ovidiu Stanga, Gabriel Popescu - midfielders; Viorel Moldovan, Adrian Ilie, Gheorghe Craioveanu, Radu Niculescu - forwards. 3133 !GCAT !GSPO Russian double Olympic swimming champion Alexander Popov was in a serious condition on Monday after being stabbed on a Moscow street. A doctor said it was too early to say whether Popov, the only man to retain the Olympic 50 and 100 metres freestyle titles, would return to top-level sport. "His condition is serious," said Rimma Maslova, deputy chief doctor of Hospital No 31 in the Russian capital. "But he is conscious and is talking and smiling." Maslova told Reuters she was not an expert in sports medicine, but said it was too early to judge Popov's chances of returning to competitive swimming. Popov, who won gold in the 50 and 100 metres freestyle at the recent Atlanta Olympics, was stabbed in the abdomen late on Saturday after an argument with a group of roadside watermelon sellers in south-west Moscow. Maslova said the wound had affected a lung and a kidney. Doctors operated on Popov, 24, for three hours. Popov told NTV television on Sunday he was in no danger and promised he would be back in the pool shortly. "There's no need to worry. We're going to be walking soon -- and swimming," he insisted cheerfully from his bed in the intensive care unit. Interfax news agency said police had detained one of the attackers. It said the row started when Popov and a group of his friends were returning from a party. Vitaly Smirnov, president of the Russian National Olympic Committee, said President Boris Yeltsin had given the swimmer Russia's top award for his Olympic performance. "I am not a doctor but I think he is doing all right," said Smirnov. Smirnov said the Olympic Committee might ask the government to take measures to protect the country's best athletes, some of whom have already chosen to live abroad for fear of a surge in crime in post-Soviet Russia. 3134 !GCAT !GSPO Results of Slovak first division soccer matches at the weekend: Inter Bratislava 0 Slovan Bratislava 2 Chemlon Humenne 0 Tatran Presov 1 Artmedia Petrzalka 0 JAS Bardejov 0 DAC Dunajska Streda 1 Spartak Trnava 3 Dukla Banska Bystrica 3 FC Nitra 0 MSK Zilina 0 FC Kosice 2 Petrimex Prievidza 2 FC Rimavska Sobota 0 Lokomotiva Kosice 2 Kerametal Dubnica 0 Standings (tabulate under games played, won, drawn, lost, goals for, goals against, points): Tatran Presov 4 3 1 0 5 0 10 Dukla Banska Bystrica 4 3 0 1 7 2 9 Slovan Bratislava 4 3 0 1 7 2 9 Petrimex Prievidza 4 3 0 1 4 2 9 Spartak Trnava 4 2 2 0 10 5 8 FC Kosice 4 2 2 0 6 3 8 Artmedia Petrzalka 4 1 3 0 1 0 6 DAC Dunajska Streda 4 2 0 2 5 6 6 FC Rimavska Sobota 4 2 0 2 4 5 6 JAS Bardejov 4 1 2 1 2 2 5 Chemlon Humenne 4 1 1 2 1 2 4 Inter Bratislava 4 1 1 2 4 6 4 Lokomotiva Kosice 4 1 1 2 3 5 4 Kerametal Dubnica 4 0 1 3 3 9 1 FC Nitra 4 0 0 4 1 8 0 MSK Zilina 4 0 0 4 0 6 0 3135 !GCAT !GSPO Hungarian first division soccer results and standings from weekend and bank holiday: Stadler 0 Haladas 0 MTK 3 Ferencvaros 0 Bekescsaba 0 BVSC 1 Csepel 1 Videoton(*) 1 ZTE 1 Debrecen 5 Siofok 0 Ujpest 2 Vac 0 Vasas 1 Kispest 3 Pecs 1 Standings (tabulated under played, won, drawn, lost, goals for, goals against, points): 1. Ujpest TE 3 3 - - 10 2 9 2. MTK 3 3 - - 7 1 9 3. BVSC 3 2 1 - 6 2 7 4. Debrecen 3 2 - 1 10 4 6 5. Bekescsaba 3 2 - 1 6 2 6 6. FTC 3 2 - 1 8 7 6 7. Haladas 3 1 2 - 2 1 5 8. Videoton 3 1 1 1 7 5 4 9. Vasas 3 1 1 1 3 3 4 10. Kispest 3 1 1 1 6 7 4 11. Gyor 3 1 1 1 3 5 4 12. Csepel 3 - 3 - 3 3 3 13. Pecs 3 1 - 2 3 5 3 14. ZTE 3 1 - 2 3 10 3 15. Stadler FC 3 - 1 2 2 6 1 16. III. ker. TVE 3 - 1 2 2 7 1 17. Siofok 3 - - 3 2 7 0 18. Vac 3 - - 3 2 8 0 *Name of Parmalat/Fehervar FC has been changed to Videoton. -- Budapest newsroom, +361 266 2410 3136 !GCAT !GSPO Results of the Czech Republic's first division soccer matches at the weekend: Petra Drnovice 1 Slovan Liberec 3 SK Slavia Praha 3 SK Ceske Budejovice 0 FK Jablonec 3 Viktoria Zizkov 1 Banik Ostrava 3 FK Teplice 1 Boby Brno 1 Sigma Olomouc 0 FC Bohemians 0 FC Karvina 2 SK Hradec Kralove 0 Kaucuk Opava 0 Playing Monday: Viktoria Plzen v AC Sparta Praha Standings (tabulate under games played, won, drawn, lost, goals for, against, points): Boby Brno 3 3 0 0 5 2 9 Banik Ostrava 3 2 0 1 7 3 6 FK Jablonec 3 2 0 1 5 2 6 SK Slavia Praha 3 1 2 0 6 3 5 Kaucuk Opava 3 1 2 0 2 1 5 Sigma Olomouc 3 1 1 1 6 3 4 Petra Drnovice 3 1 1 1 7 5 4 Slovan Liberec 3 1 1 1 5 4 4 FK Teplice 3 1 1 1 3 4 4 FC Karvina 3 1 1 1 3 5 4 SK Ceske Budejovice 3 1 1 1 3 5 4 Viktoria Plzen 2 0 2 0 2 2 2 AC Sparta Praha 2 0 1 1 3 4 1 FC Bohemians 3 0 1 2 1 4 1 Viktoria Zizkov 3 0 1 2 3 8 1 SK Hradec Kralove 3 0 1 2 1 7 1 3137 !GCAT !GSPO Results of weekend matches in the Mexican soccer championship: Atlante 1 Atlas 1 Cruz Azul 2 Leon 2 Guadalajara 5 America 0 Monterrey 2 Veracruz 1 Pachuca 3 Toluca 0 Puebla 2 UNAM 1 Santos 2 Morelia 1 UAG 1 Neza 2 Standings (tabulated under played, won, drawn, lost, goals for, against, points) Group 1 Puebla 3 3 0 0 7 2 9 Cruz Azul 3 2 1 0 7 3 7 Atlante 3 2 1 0 6 2 7 Neza 3 1 0 2 2 7 3 Veracruz 3 0 1 2 2 6 1 Group 2 Necaxa 3 1 1 1 6 4 4 Pachuca 3 1 1 1 6 7 4 Leon 3 0 3 0 3 3 3 America 3 1 0 2 5 7 3 Morelia 3 0 1 2 3 8 1 Group 3 Atlas 3 2 1 0 7 2 7 Guadalajara 3 2 1 0 7 0 7 Toluca 3 1 0 2 6 5 3 UNAM 3 0 0 3 2 6 0 Group 4 Santos 3 3 0 0 4 1 9 Monterrey 4 1 1 2 2 5 4 Celaya 2 0 2 0 1 1 2 UAG 3 0 0 3 1 8 0 3138 !GCAT !GSPO Two key players left a Brazilian championship match early on Sunday because they had to catch a plane to Russia to play with the national team. Sao Paulo midfielder Andre and Santos defender Narciso were both substituted during their teams' game, taken to Sao Paulo airport and flown to Rio de Janeiro in a private jet chartered by the Brazilian Football Confederation (CBF). At Rio, they joined up with the national team squad for the journey to Moscow, where Brazil will face Russia in a friendly international on Wednesday. The problem arose because the Sao Paulo-Santos clash was selected as the day's televised live match, forcing it to be put back three hours from the usual kickoff time. Santos suffered more from their loss as Narciso's replacement Jean gave away a penalty from which Sao Paulo scored the decisive goal in a 2-1 win. Sao Paulo lead the first stage of the championship on goal difference from surprise package Juventude, who beat Internacional 2-1. Corinthians, who played in a tournament in Spain last week, also faced a plane marathon as they attempted to keep up with a hectic fixture list. They were due to leave Spain Monday night, arrive in Sao Paulo on Tuesday morning, catch another plane to the southern city of Curitiba one hour later and then play away to Atletico Paranaense in the Brazilian championship the same evening. Botafogo striker Tulio, who was overlooked by Zagalo for the tour which also features a game away to the Netherlands on Sunday, scored his third goal in three games as the defending champions beat Bahia 2-1 away. Tulio, who has been top-scorer in the competition for the last two seasons, has been struggling against injury for most of this year. 3139 !GCAT !GSPO Independiente, playing their first match under veteran coach Cesar Luis Menotti, began the Argentine Apertura championship with a 3-0 away win at Ferro Carril Oeste on Sunday. The chain-smoking coach, who was in charge of the Argentina team that won the World Cup in 1978, was given a rousing reception by Independiente fans on his return to soccer after two years working for a television station. Independiente won through second-half goals from Francisco Guerrero, Gustavo Arzona and Angel Morales but the real Independiente hero was Colombian goalkeeper Farid Mondragon, who kept the home team at bay at least half a dozen times. Menotti, whose last coaching job was at Boca Juniors, took over at Independiente last week. San Lorenzo's Hector Vieira experienced the other side of soccer coaching, resigning after his side's 1-0 defeat at home to Banfield. Boca Juniors, without Diego Maradona, whose future remains uncertain, began with a 3-2 win away to Estudiantes with a team boasting an array of new players. Coach Carlos Bilardo, who has said "coming second is no good for a club like Boca", saw his team go 3-0 ahead in 51 minutes after a performance masterminded by Diego Latorre. But Boca fans were made to suffer when Estudiantes pulled two goals back and poured forward looking for an equaliser. Even goalkeeper Carlos Bossio, who scored for his side last season, joined the attack in the closing minutes, but Boca held on to win. The Apertura championship, the first of two tournaments played in the Argentine season, marks the start of the 1996-97 season and began a week after the end of the 1995-96 Clausura tournament, won by Velez Sarsfield. Velez, who also won the 1995-96 Apertura to become the first team to complete the double, beat Newell's Old Boys 2-0 away. In the match between the two newly promoted sides, Josemir Lujambio scored a hat-trick but finished on the losing side as Huracan-Corrientes went down 6-3 at home to Union. Union's Jose Luis Marzo also scored a hat-trick. 3140 !GCAT !GSPO Results of matches on the opening weekend of the Argentine Apertura championship: Estudiantes 2 Boca Juniors 3 Ferro Carril Oeste 0 Independiente 3 Gimnasia-Jujuy 1 Platense 0 Huracan 0 Lanus 0 Huracan-Corrientes 3 Union 6 Newell's Old Boys 0 Velez Sarsfield 2 Racing Club 0 Rosario Central 2 River Plate 0 Gimnasia-La Plata 0 San Lorenzo 0 Banfield 1 Playing Monday: Deportivo Espanol v Colon Note: the Apertura is the first of two championships played in the Argentine season. The teams meet each other once in each tournament. There is no overall champion. 3141 !GCAT !GSPO Honduras beat Cuba 4-0 (halftime 3-0) in a friendly soccer international on Sunday. Scorers: Juan Castro (3rd minute), Enrique Centeno (33rd and 84th), Carlos Pavon (37th) 3142 !GCAT !GSPO Results of Brazilian soccer championship matches played at the weekend. Bahia 1 Botafogo 2 Bragantino 1 Vasco da Gama 2 Cricuma 4 Fluminense 1 Cruzeiro 2 Flamengo 1 Goias 0 Palmeiras 0 Gremio 2 Vitoria 2 Juventude 2 Internacional 1 Parana 3 Guarani 0 Portuguesa 3 Atletico Mineiro 1 Sao Paulo 2 Santos 1 Sport Recife 3 Coritiba 0 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Sao Paulo 4 3 1 0 10 5 10 Juventude 5 3 1 1 5 4 10 Portuguesa 4 3 0 1 8 3 9 Palmeiras 5 2 3 0 8 1 9 Goias 5 2 2 1 7 4 8 Gremio 3 2 1 0 11 4 7 Cruzeiro 3 2 1 0 4 2 7 Sport Recife 5 2 1 2 7 6 7 Parana 4 2 1 2 5 5 7 Flamengo 4 2 0 2 4 4 6 Atletico Mineiro 5 2 0 3 6 7 6 Vasco da Gama 4 2 0 2 6 7 6 Coritiba 5 2 0 3 3 9 6 Botafogo 3 1 2 0 4 3 5 Internacional 4 1 2 1 4 3 5 Criciuma 5 1 2 2 7 8 5 Vitoria 5 1 2 2 5 6 5 Santos 3 1 1 1 3 3 4 Corinthians 4 1 1 2 1 3 4 Bahia 5 1 1 3 5 8 4 Fluminense 4 1 1 2 3 6 4 Atletico Paranaense 3 1 0 2 4 6 3 Guarani 3 0 1 2 1 5 1 Bragantino 4 0 0 4 3 12 0 Note: Top eight teams qualify for the quarter-finals. If teams are level on points, positions are determined by the number of games won. 3143 !GCAT !GSPO Yuri Arbachakov of Russia retained his World Boxing Council (WBC) flyweight title on Monday by stopping Japan's Takato Toguchi in the ninth round. In his ninth successful title defence, 29-year-old Arbachakov knocked Toguchi to the canvas twice in the seventh round before referee Nobuaki Uratani ended the scheduled 12-round fight a minute and 29 seconds into the ninth. Japan-based Arbachakov extended his unbeaten professional record to 23 victories with 16 knockouts, while 26-year-old Taguchi, the WBC's eighth-ranked challenger, stands on 18 wins and three losses. 3144 !GCAT !GSPO Formula Shell reached the final of the Philippine Basketball Association second conference when Ken Redfield sank a three-pointer with 0.4 seconds left to give his team a 89-86 win over Ginebra San Miguel. "That was a prayer of a shot," Shell coach Chito Narvasa said after the American import made his running jump shot in a sudden death playoff on Sunday with crowd favourite Ginebra. Shell will meet early finalist Alaska Milk in a best of seven championship series starting on Tuesday. The score was tied at 86-all when American Henry James, the Ginebra import, tried a three-point shot with about five seconds remaining but Benjie Paras blocked the attempt. Shell seized possession and Redfield raced down the court to shoot the winning basket. 3145 !GCAT !GSPO Results of semi-final round games played on late Sunday in the Philippine Basketball Association second conference, which includes American players: Formula Shell beat Ginebra San Miguel 89-86 (45-46 half-time) 3146 !GCAT !GSPO Results of South Korean pro-soccer games played on Sunday. Puchon 3 Chonan 0 (halftime 1-0) Pohang 3 Chonbuk 2 (halftime 0-0) Standings after games played on Sunday (tabulate under - won, drawn, lost, goals for, goals against, points): W D L G/F G/A P Puchon 2 1 0 4 0 7 Chonan 2 0 1 9 9 6 Pohang 1 1 1 8 8 4 Ulsan 1 0 1 6 6 3 Anyang 0 3 0 5 5 3 Suwon 0 3 0 3 3 3 Pusan 0 2 0 3 3 2 Chonnam 0 2 1 4 5 2 Chonbuk 0 0 2 2 5 0 3147 !GCAT !GSPO Results of South Korean pro-baseball games played on Sunday. OB 2 Lotte 1 Hanwha 3 Haitai 2 Hyundai 8 Samsung 1 Ssangbangwool 3 LG 1 Standings after games played on Sunday (tabulate under won, drawn, lost, winning percentage, games behind first place) W D L PCT GB Haitai 63 2 41 .604 - Ssangbangwool 58 2 47 .551 5 1/2 Hyundai 56 5 47 .542 6 1/2 Hanwha 56 1 48 .538 7 Samsung 47 5 55 .463 15 Lotte 44 6 53 .456 15 1/2 LG 44 5 58 .435 18 OB 41 6 60 .411 20 1/2 3148 !GCAT !GSPO Results of Moroccan first division soccer matches played on Sunday: Widad Fes 3 Oujda 1 Raja Casablanca 4 Tetouan 0 Jeunesse Massira 0 Widad Casablanca 2 Sporting Sale 0 Meknes 1 Settat 1 Marrakesh 0 Khouribga 3 Mohammedia 0 Sidi Kacem 0 Royal Armed Forces 0 El Jadida 1 Hassania Agadir 0 3149 !GCAT !GSPO St. Louis Cardinals pitcher Donavan Osborne was jailed briefly Monday after he was wrestled to the grown and handcuffed for refusing to leave a Houston nightclub when it closed, a police official said. Houston Police Department Assistant Chief Jimmy Dotson told reporters that Osborne, 27, was charged with public intoxication and criminal trespass when he refused an order from three off-duty officers working as security guards to leave Roxy's nightclub, a popular singles bar. The officers were trying to break up a fight between two other people just at the 2 a.m. closing time and asked customers to clear the club, but Osborne "resisted and had to be subdued," Dotson said. Osborne was not involved in the fight. "He just didn't want to leave the club," Dotson said. The arresting officers said Osborne had slurred speech, bloodshot eyes and had a dishevelled appearance. Dotson said the officers had to wrestle Osborne to the ground to put the handcuffs on him, "but there were no licks thrown." Osborne, who won a 1-0 shutout of the Houston Astros here on Friday night, was taken to jail and released several hours later on $500 bail, Dotson said. Maximum punishment for the two offences is a total of $500 in fines, he said. In a statement issued Monday, Osborne apologised for the incident. "I assure everyone that I will make every effort to prevent anything like this from happening again," he said. 3150 !GCAT !GSPO The New York Mets fired manager Dallas Green and replaced him with Bobby Valentine on Monday. The Mets, who had been expected to contend for a wild-card berth in the playoffs but instead are 13 games under .500, just completed a 2-7 West Coast road trip and are a disappointing 59-72 this season. They are in fourth place in the National League East, 23 games behind first-place Atlanta. "We have not done as well as anticipated. The progress has been slower than expected," Mets general manager Joe McIlvaine said. Valentine, a native of nearby Connecticut, has been long-rumoured as Green's successor and was managing the Mets' Triple-A affiliate in Norfolk. Valentine, who will make his debut Tuesday night when the Mets host the San Diego Padres, managed the Texas Rangers from May 1985 until he was fired in July 1992. He also managed in Japan. "One thing I know about living and growing up in this area is that it's an emotional area," Valentine said. "And emotion drives many of the people in this area, yet, they know their sports. ... I'm confident that the decision will come back in my favour .... this is as great an honour as you can have." The Mets also fired bench coach Bobby Wine and pitching coach Greg Pavlick and named Bob Apodaca pitching coach. Apodaca is a former Met and the pitching coach for Valentine at Norfolk. The rest of the coaching staff is expected to complete the season. New York was expected to contend for a wild-card berth after a strong second-half finish in 1995, but the team suffered a series of injuries and several young players failed to live up to expectations. New York closed its most recent road trip with four straight losses, including a 6-5 defeat on Sunday in which it squandered a 4-0 lead. "The main thing we are looking for is a new approach, a new touch," McIlvaine said. "We feel these two people (Valentine and Apodaca) are the best two teachers in the organisation. Players come to the major leagues quicker. There is a need for more on-the-job training." The 62-year-old Green had a 229-283 record since taking over as Mets manager on May 19th, 1993. He also managed the Philadelphia Phillies from 1979-81, the Chicago Cubs from 1982 to 1987 and the New York Yankees in 1989. Green led the Phillies to the World Series championship in 1980 and the Cubs to the NL East Division crown in 1984, their first title of any kind in 39 years. He has an all-time managerial record of 454-478. The Mets become the fourth team to change managers this season. Rene Lachemann was fired by the Florida Marlins and brother Marcel Lachemann resigned as manager of the California Angels. Tommy Lasorda retired from the Los Angeles Dodgers due to health reasons. 3151 !GCAT !GSPO A message on television monitors all around the National Tennis Centre reads: "Due to hot weather please seek shade and drink plenty of fluids" -- sound advice until you check out the price of fluids. Perhaps the advisory was cut off before concluding: "...and bring plenty of money." A small bottle of a garishly-coloured sports drink at the sun-drenched U.S. Open is going for $3.75, while a litre of basic, life-sustaining water will set you back $4.00 -- for water? "At the Olympics water was only a dollar, and that was the Olympics," said one incredulous fan, noting that the Atlanta Games had been notorious for price gouging. U.S. Open officials managed to insult most of the male tennis players last week with their controversial handling of the seeding and draw. When the tournament began on Monday it was the fans' turn to be offended. "That baked lasagna better be good for $8.50," said New Yorker Rebecca Weinstein, a U.S. Open regular who was eating a sandwich she had brought from home. A trio of hungry fans at the food court who had already forked over the lasagna money pronounced it good, but Carol Perry chimed in, "The water is ridiculous, they want four dollars for the water, you might as well get a glass of wine." Indeed, a nice glass of chardonnay or white zinfandel was going for $4.75, while an imported beer was just a bit more than the water at $4.50. What's the message here? "Maybe they want us to be alcoholics," Perry joked before lifting her glass of wine. Fans will be shelling out $12.50 for a hamburger and a large french fries. And that little snack is guaranteed to make you thirsty. Make that $16.50. Even a sandwich as pedestrian as a ham and swiss cheese is going for a whopping $8.00. Of course, it is served on a tuscan roll. It must be the cost of flying those rolls over from Tuscany every day that drives up the price of the sandwich. 3152 !GCAT !GSPO MaliVai Washington enjoyed the highlight of his tennis career this summer by reaching the Wimbledon final, but, of course, he knows that doesn't mean anything at the U.S. Open. "It's a memory," the 11th-seeded Washington said of Wimbledon after beating Karim Alami on the opening day of the U.S. Open Monday. Last month, Washington became the first unseeded Wimbledon finalist since Boris Becker in 1985. But as he said, "That's in England, we're in the States. "That's grass, this is hardcourts. People there are normal, people here in New York are weird," he said after his 6-4 2-6 7- 6 6-1 victory. "Whatever the wierdness of your mind can conceive you can find it in New York," he said. "It's totally different. It's a totally new tournament," added Washington, who also began his Wimbledon campaign with a four-set victory. "I mean guys aren't all of a sudden going to roll over and die just because I made the finals of Wimbledon," said Washington, who hurried off the sun-baked National Tennis Centre stadium court for treatment of an upset stomach after the two and half hour struggle against the Moroccan. Washington has not played well this summer since losing the Wimbledon final to Dutchman Richard Krajicek. His best result was a quarter-final berth at the Olympics and last week he lost in the third round at the Canadian Open. However, Washington is confident about his prospects of having a good Open, which means at least sticking around for a projected fourth-round encounter with sixth-seeded countryman Andre Agassi. "Now, I know I can get to the finals of a Grand Slam. I think I expect bigger things," said the 27-year-old Washington. "Playing Andre, that would be a pretty nice meeting." 3153 !GCAT !GSPO Martina Hingis led a youthful charge and Australian Open finalist Anke Huber and Magdalena Maleeva were fallen seeds on Monday in a hot, sunny opening to the U.S. Open tennis championships. The 15-year-old Hingis, seeded 16th, was honoured to play the first match of the season's last Grand Slam on Stadium Court but happy to hurry off with a straight-sets victory over the 112th-ranked Angeles Montolio of Spain. "It was very hot and I didn't want to stay long on the court," said a cheery Hingis, who had no worries in racing to a 6-1 6-0 victory against the overmatched Spaniard. Hoping for a longer engagement on the cement at Flushing Meadows were the sixth-seeded Huber of Germany and 12th seed Maleeva of Bulgaria. Huber, who lost to Monica Seles in the Australian Open final, fell victim to an unfortunate draw in bowing to dangerous floater Amanda Coetzer of South Africa. Coetzer, ranked 17th, avenged her defeat to Huber in the Australian Open semifinals by winning 6-1 2-6 6-2. "I looked at it as not a first round match, just a great challenge for me," said Coetzer, 24. "I was really concentrating on keeping my own momentum and my own rhythm. "She is tough to play in that way because she plays very up and down. She played one great game and than a few errors. The challenge was just for me to keep playing my own game." Huber, who reached the final a week ago at Manhattan Beach, could only mourn her luck of the draw. "I wasn't happy when I saw the draw. She was the first non- seeded player," said the 21-year-old German. "It's always tough to play somebody like that in the first round in a Grand Slam. "I think I didn't play that bad today. It was maybe my best first round match in a Grand Slam I ever played." Monday brought the best out in U.S. Open rookie Aleksandra Olsza of Poland, ranked 110th. The 18-year-old Olsza, last year's Wimbledon junior champion, celebrated her debut in the main draw of the Open by removing Maleeva 6-4 6-2. The curtain-raising victories by Hingis and Olsza provided a ringing endorsement for the newest wave of women's players coming up from the junior ranks. The Swiss teenager, a twice French Open junior champion and a Wimbledon juniors winner, had already proven her main stage mettle by reaching the quarters at this year's Australian Open. "I hope I can get into the last 16," said Hingis, seeded to face third seed Arantxa Sanchez Vicario in the fourth round. Hingis has been working hard on conditioning and has lost eight pounds (3.5 kilos) in advance of the championships. "There will be tough matches but I hope I can get there," she said. "Then we'll see if Arantxa will be there, too." The fast-moving Olsza, 18, was cool in her opening match. "I wasn't scared when I heard that I was playing Maleeva," said Olsza. "I know that if I want to play professional tennis I have to do my best to try to beat her and I can't be scared." Olsza is undaunted by the level of competition in the pros. "In terms of tennis, I think the junior players are really good now. In a few years, it could change a lot among the top players." Two big-serving women's players made quick work of Japanese opponents. Brenda Schultz-McCarthy of the Netherlands, the 13th seed, was a 6-1 6-4 winner over Japan's Nana Miyaga, while Czech veteran Helena Sukova prevailed over Yone Kamio 6-2 6-3. Austrian Barbara Paulus, seeded 14th, also reached the second round with a 6-2 6-1 victory over Yi Jing-Qian of China. 3154 !GCAT !GSPO Michael Stich nearly pulled out of the U.S. Open in protest over the men's seeding fiasco but the former Wimbledon champion was glad he stayed after sweating out a four-set win on Monday over qualifier Tommy Haas. "I still feel it's embarrassing what happened and I was about to pull out yesterday and say, 'That's it,'" said Stich, one of a host of men who cried foul over seeding procedures that forced an unprecedented remaking of the men's draw last week. "But there are so many reasons to play, especially spectators and the kids who come out here and want to enjoy watching tennis, that I decided to stay." In a break from tradition, the Open did not seed in strict accordance with ATP rankings, instead taking into account other factors that raised objections of favourtism toward U.S. players. One prominent player that did not stay for the Open was French Open champion Yvegeny Kafelnikov, who after being dropped three spots from his ATP ranking to a seventh seeding, withdrew and returned home to Russia. Kafelnikov had pulled out of last week's tournament with a rib injury. At a news conference attended by approximately 50 players on Sunday, U.S. Davis Cup player Todd Martin expressed the players' outrage at the seedings. "The way the U.S. Open has seeded here, tampering with the ranking system, has tarnished the image and reputation of this U.S. Open in the players' mind, and we think that is damaging to our sport," Martin said. Stich said he felt the players ought to have organised an active protest. "I feel that we made it a little easy for the USTA. They didn't really get hurt as much as I think they should have," said Stich. "I feel that we should have maybe just cancelled out the Monday, not show up today and start the tournament tomorrow." But once the 27-year-old Stich got on the court, he focused his energies on trying to win the year's last Grand Slam. He took a positive first step with his 6-3 1-6 6-1 7-5 win over compatriot Haas on a sun-baked Grandstand court. Others advancing early on Monday included 11th-seeded American Malivai Washington, the Wimbledon runner-up, Sweden's Magnus Gustafsson, and two-time former French Open champion Sergi Bruguera of Spain, who will be Stich's next opponent. The suspicion, however, lingers in Stich's mind that U.S. Open officials did tamper with the seeding process in order to benefit homegrown players. "I get the feeling that everything is done here for the American players and they forget about all the other players," said Stich, who lost the 1994 Open final to Andre Agassi. It was Agassi who was at the centre of the controversy that engulfed the tournament since the original draw was completed on Wednesday. The flamboyant American star was bumped up two spots from his ATP ranking of eight to a seeding of six. "He (Agassi) should be seeded the way he is playing tennis right now," said Stich about the unfairness of moving up Agassi, who made early exits from the French Open and Wimbledon. Stich, not seeded here for the first time since 1990, might have benefitted from some fiddling with the seedings himself after Kafelnikov withdrew. Ranked 18th in the world, Stich might have been slipped into that spot ahead of Spain's Felix Mantilla, who is 16th but had never been played in the Open and had been left out of the seedings originally. But Stich didn't want to play that game. "I think he deserves to be seeded as everybody else who is in the top 16 deserves to be seeded," Stich said. 3155 !GCAT !GSPO Fifteen-year-old Martina Hingis of Switzerland beat the heat with a brisk victory on Monday in the opening Stadium Court match to launch the U.S. Open tennis championships. Hingis, the 16th seed, dismissed 112th-ranked Angeles Montolio of Spain 6-1 6-0 in precisely one hour to get the season's last Grand Slam fortnight underway on a brilliantly sunny day at the National Tennis Centre. "It was very hot and I didn't want to stay long on the court," said a cheery Hingis, who had no worries against the overmatched Spaniard. "To have the first match in the stadium and the first match at the U.S. Open was very nice." Even quicker than the precocious Swiss teenager was big Brenda Schultz-McCarthy, the 13th seed. The hard-serving Dutchwoman dispatched Japan's Nana Miyagi 6-1 6-4 in just 56 minutes. Not so fortunate was 12th-seed Magdalena Maleeva, who was forced into a quick getaway from Flushing Meadows by Poland's Aleksandra Olsza. Olsza, rated 110th in the world, notched the first upset of the tournament by beating the Bulgarian 6-4 6-2. Later on Stadium Court, second-seeded American Michael Chang was going against Brazilian Jaime Oncins. Featured night matches included former champions Andre Agassi and Gabriela Sabatini. The sixth-seeded Agassi, the newly crowned Olympic champion, will be meeting Mauricio Hadad of Colombia, while Sabatini, seeded 15, takes on Canada's Patricia Hy-Boulais. On the men's side, two former Grand Slam tournament winners -- Sergi Bruguera of Spain and Germany's Michael Stich -- posted early victories to set up a second-round showdown. Twice French Open champion Bruguera advanced with a 6-2 6-0 7-6 win over Belgian Kris Goossens, while 1991 Wimbledon champion Stich defeated compatriot Tommy Haas 6-3 1-6 6-1 7-5. The curtain-raising victories by Hingis and Olsza provided a ringing endorsement for the newest wave of women's players coming up from the junior ranks. The Swiss teenager, a twice French Open junior champion and a Wimbledon juniors winner, had already proven her main stage mettle by reaching the quarters at this year's Australian Open. "I hope I can get into the last 16," said Hingis, who is seeded to face third seed Arantxa Sanchez Vicario in the fourth round. Hingis has been working hard on her conditioning and has dropped nearly eight pounds (3.5 kg) in advance of the championships. "There will be tough matches but I hope I can get there," she said. "Then we'll see if Arantxa will be there, too." Olsza made her statement with victory against the seeded Maleeva in her first U.S. Open main draw match. "I wasn't scared when I heard that I was playing Maleeva," said the fast-moving, 18-year-old Olsza. "I know that if I want to play professional tennis I have to do my best to try to beat her and I can't be scared." Olsza is undaunted by the level of competition in the pros. "The money for sure is the big difference," she said. "As for the tennis, I think the junior players are really good now. In a few years, it could change a lot among the top players." Not that Olsza suffers from overconfidence. "I was just happy it was not Sanchez Vicario or (Lindsay) Davenport," she said about her opening-round draw. 3156 !GCAT !GSPO Results of first round matches on Monday in the U.S. Open tennis championships at the National Tennis Centre (prefix denotes seeding): Women's singles 16-Martina Hingis (Switzerland) beat Angeles Montolio (Spain) 6-1 6-0 Anne-Gaelle Sidot (France) beat Janette Husarova (Slovakia) 6-4 6-4 13-Brenda Schultz-McCarthy (Netherlands) beat Nana Miyagi (Japan) 6-1 6-4 Aleksandra Olsza (Poland) beat 12-Magdalena Maleeva (Bulgaria) 6-4 6-2 Men's singles Michael Stich (Germany) beat Tommy Haas (Germany) 6-3 1-6 6-1 7-5 Sergi Bruguera (Spain) beat Kris Goossens (Belgium) 6-2 6-0 7-6 (7-1) Frederic Vitoux (France) beat Ramon Delgado (Paraguay) 6-4 6-4 7-6 (7-3) Women's singles Henrietta Nagyova (Slovakia) beat Gala Leon Garcia (Spain) 6-1 4-6 6-3 Asa Carlsson (Sweden) beat Gloria Pizzichini (Italy) 3-6 6-1 7-5 Barbara Schett (Austria) beat Sabine Appelmans (Belgium) 1-6 6-4 6-4 Cristina Torrens-Valero (Spain) beat Sabine Hack (Germany) 2-6 6-4 6-2 Women's singles Helena Sukova (Czech Republic) beat Yone Kamio (Japan) 6-2 6-3 Irina Spirlea (Romania) beat Petra Begerow (Germany) 6-3 6-2 Maria Jose Gaidano (Argentina) beat Melanie Schnell (Austria) 6-4 6-0 Men's singles Carlos Moya (Spain) beat Scott Humphries (U.S.) 6-1 6-7 (3-7) 6-7 (1-7) 6-0 6-4 Kenneth Carlsen (Denmark) beat Patrick Rafter (Australia) 7-6 (9-7) 6-3 7-6 (8-6) Magnus Gustafsson (Sweden) beat Carlos Costa (Spain) 7-5 4-6 7-6 (7-4) 6-3 Jeff Tarango (U.S.) beat Alex Radulescu (Romania) 6-7 (5-7) 6-4 6-1 retired, heat exhaustion Men's singles 11-MaliVai Washington (U.S.) beat Karim Alami (Morocco) 6-4 2-6 7-6 (7-5) 6-1 Dirk Dier (Germany) beat Chuck Adams (U.S.) 6-4 2-6 6-4 6-4 Jason Stoltenberg (Australia) beat Stefano Pescosolido (Italy) 7-5 6-4 6-1 Arnaud Boetsch (France) beat Nicolas Pereira (Venezuela) 7-6 (7-4) 6-4 7-5 David Prinosil (Germany) beat Peter Tramacchi (Australia) 6-3 6-2 3-6 6-7 (5-7) 6-1 Women's singles Amanda Coetzer (South Africa) beat 6-Anke Huber (Germany) 6-1 2-6 6-2 Anna Kournikova (Russia) beat Ludmila Richterova (Czech Republic) 7-6 (7-4) 6-3 Debbie Graham (U.S.) beat Stephanie Deville (Belarus) 6-4 6-2 Barbara Rittner (Germany) beat Katarina Studenikova (Slovakia) 7-5 7-5 Kristina Brandi (U.S.) beat Andrea Glass (Germany) 6-2 6-3 Ines Gorrochategui (Argentina) beat Magdalena Grzybowska (Poland) 4-6 6-4 6-1 Men's singles Alberto Berasategui (Spain) beat Cecil Mamiit (U.S.) 6-1 6-4 6-0 Guillaume Raoux (France) beat Filip Dewulf (Belgium) 7-6 (7-5) 3-6 1-6 6-4 7-5 Alex O'Brien (U.S.) beat Nicolas Lapentti (Ecuador) 6-4 1-6 6-4 6-3 2-Michael Chang (U.S.) beat Jaime Oncins (Brazil) 3-6 6-1 6-0 7 -6 (8-6) Women's singles 14-Barbara Paulus (Austria) beat Yi Jing-Qian (China) 6-2 6-1 Wang Shi-Ting (Taiwan) beat Corina Morariu (U.S.) 6-4 6-7 (5-7) 6-2 Linda Wild (U.S.) beat Sung-Hee Park (South Korea) 6-2 6-3 Sarah Pitkowski (France) beat Meghann Shaughnessy (U.S.) 6-3 6- 3 Dally Randriantefy (Madagascar) beat Elena Makarova (Russia) 6- 3 1-6 7-5 Laurence Courtois (Belgium) beat Flora Perfetti (Italy) 6-4 3-6 6-2 Men's singles Leander Paes (India) beat Marcos Ondruska (South Africa) 7-6 (7-3) 6-2 7-5 Jan Siemerink (Netherlands) beat Carl-Uwe Steeb (Germany) 4-6 6 -1 7-6 (7-4) 6-4 Neville Godwin (South Africa) beat Tomas Carbonell (Spain) 6-4 6-2 3-6 6-1 Jim Grabb (U.S.) beat Sandon Stolle (Australia) 6-3 7-5 7-6 (7-4) Women's singles Alexandra Fusai (France) beat Jill Craybas (U.S.) 6-1 2-6 7-5 Naoko Kijimuta (Japan) beat Tatyana Jecmenica (Yugoslavia) 6-3 6-2 Nathalie Dechy (France) beat Christina Singer (Germany) 6-4 6-0 Jane Chi (U.S.) beat Maria Antonio Sanchez Lorenzo (Spain) 6-4 1-6 6-3 Els Callens (Belgium) beat Nicole Bradtke (Australia) 7-6 (7-1) 7-6 (9-7) Natalia Baudone (Italy) beat Jolene Watanabe (U.S.) 6-4 4-6 7-6 (8-6) Ai Sugiyama (Japan) beat Jana Kandarr (Germany) 6-2 6-1 3157 !GCAT !GSPO Matches on the featured courts in Monday's opening day at the U.S. Open tennis championships at the National Tennis Centre (prefix denotes seeding): Stadium (starting at 11 a.m., 1500 GMT) 16-Martina Hingis (Switzerland) v Angeles Montolio (Spain) 11-Malivai Washington (U.S.) v Karim Alami (Morocco) 2-Michael Chang (U.S.) v Jaime Oncins (Brazil) Grandstand Michael Stich (Germany) v Tommy Haas (Germany) 6-Anke Huber (Germany) v Amanda Coetzer (South Africa) Alex O'Brien (U.S.) v Nicolas Lapentti (Ecuador) Stadium evening session (starting 7:30 p.m., 2330 GMT) 15-Gabriela Sabatini (Argentina) v Patricia Hy-Boulais (Canada) 6-Andre Agassi (U.S.) v Mauricio Hadad (Colombia) Grandstand David Wheaton (U.S.) v Kevin Kim (U.S.) 3158 !GCAT !GSPO Brian McRae singled in Tyler Houston in the top of the ninth inning to snap a tie as the Chicago Cubs avoided a three-game sweep with 3-2 victory over the Atlanta Braves on Sunday. The Braves scored four runs in the ninth for a 6-5 victory on Saturday. Kevin Foster (5-2) won his second straight start, allowing two runs and six hits with two walks and three strikeouts over eight innings. "The biggest thing was my fastball, I was able to rotate it pretty good," Foster said. "Also, I was able to keep my changeup down." At Colorado, Vinny Castilla homered twice and drove in four runs and Larry Walker went 3-for-4 with a homer and three RBI as the Colorado Rockies outslugged the Pittsburgh Pirates 13-9 in the rubber game of a three-game series. Castilla's first homer of the game, a solo shot in the seventh off reliever Marc Wilkins (3-1) extended Colorado's lead to 9-7. He added a three-run homer in the eighth off John Ericks to make it 13-8. At Florida, Edgar Renteria's two-out single in the bottom of the ninth inning scored Jesus Tavarez with the winning run as the Florida Marlins edged the Cincinnati Reds 6-5. "Right after Edgar made contact, I knew I had to score," said Tavarez. "I knew I would score even if he fielded it cleanly, he couldn't throw me out." "Edgar is a tremendous player right now," said Florida manager John Boles. "But I can't wait to see how good he'll be when he grows up." In San Francisco, Osvaldo Fenandez fired a seven-hitter and Trenidad Hubbard belted a two-run homer as the San Francisco Giants ended a three-game losing streak by defeating the Montreal Expos, 7-2. Fernandez (6-13) allowed two runs, walked one and struck out eight for his second career complete game, both against Montreal. In Los Angeles, Greg Gagne had a run-scoring single and Chad Curtis drew a bases-loaded walk in the bottom of the eighth inning as the Los Angeles Dodgers rallied for a 6-5 victory and a three-game sweep of the New York Mets. "It was one of these games where you get three straight pinch-hits and a walk of a pinch-hitter, that's how you win pennants," Dodgers manager Bill Russell said. "Mike Piazza In San Diego, Steve Finley and Jody Reed drove in three runs apiece as the San Diego Padres built a six-run lead after three innings and cruised to an 11-2 victory over the Philadelphia Phillies. Ken Caminiti added two RBI for the Padres, who have won six of their last seven games and remained one game ahead of the Los Angeles Dodgers in the National League West. In Houston, Jeff Bagwell homered and Donne Wall allowed one run over seven innings as the Houston Astros defeated the St. Louis Cardinals 4-1. Wall (8-4) allowed three hits, walked two and struck out seven as the Astros moved 1-1/2 games ahead of the Cardinals for the lead in the National League Central. He left the game with a knot in his right shoulder. 3159 !GCAT !GSPO Major League Baseball standings after games played on Sunday (tabulate under won, lost, winning percentage and games behind): AMERICAN LEAGUE EASTERN DIVISION W L PCT GB NEW YORK 74 55 .574 - BALTIMORE 68 61 .527 6 BOSTON 66 65 .504 9 TORONTO 61 70 .466 14 DETROIT 47 83 .362 27 1/2 CENTRAL DIVISION CLEVELAND 77 53 .592 - CHICAGO 70 62 .530 8 MINNESOTA 65 65 .500 12 MILWAUKEE 62 69 .473 15 1/2 KANSAS CITY 59 73 .447 19 WESTERN DIVISION TEXAS 75 56 .573 - SEATTLE 66 63 .512 8 OAKLAND 63 70 .474 13 CALIFORNIA 61 69 .469 13 1/2 MONDAY, AUGUST 26TH SCHEDULE CLEVELAND AT DETROIT OAKLAND AT BALTIMORE MINNESOTA AT TORONTO MILWAUKEE AT CHICAGO BOSTON AT CALIFORNIA NEW YORK AT SEATTLE NATIONAL LEAGUE EASTERN DIVISION W L PCT GB ATLANTA 81 48 .628 - MONTREAL 70 59 .543 11 FLORIDA 61 70 .466 21 NEW YORK 59 72 .450 23 PHILADELPHIA 53 78 .405 29 CENTRAL DIVISION HOUSTON 70 61 .534 - ST LOUIS 68 62 .523 1 1/2 CHICAGO 64 64 .500 4 1/2 CINCINNATI 64 65 .496 5 PITTSBURGH 55 75 .423 14 1/2 WESTERN DIVISION SAN DIEGO 72 60 .545 - LOS ANGELES 70 60 .538 1 COLORADO 68 63 .519 3 1/2 SAN FRANCISCO 55 73 .430 15 MONDAY, AUGUST 26TH SCHEDULE PHILADELPHIA AT SAN FRANCISCO ST LOUIS AT HOUSTON CINCINNATI AT COLORADO 3160 !GCAT !GSPO San Francisco Giants All-Star left fielder Barry Bonds did not appear in Sunday's 7-2 victory over the Montreal Expos, ending his consecutive games streak. After appearing as a pinch-hitter in the previous two games, Bonds, who has been battling a hamstring injury, did not see any action today, ending his streak at 357 consecutive games. It was the second-longest streak by an active player in the the majors behind Baltimore's Cal Ripken, who appeared in his major-league record 2,282nd straight game today, a 13-0 loss to the California Angels. Bonds has been limited to a pinch-hitting role since an MRI Friday showed a mild strain of his left hamstring. Bonds came out of Wednesday's game against New York in the ninth inning after suffering a mild hamstring strain. He was back in the starting lineup Thursday night and went 1-for-2 before exiting in the third inning. The 32-year-old Bonds is hitting .307 with 35 homers and 107 RBI and has been one of the few bright spots for the last-place Giants. Chicago Cubs outfielder Sammy Sosa had the third-longest streak at 304 games, but that ended earlier this week when he suffered a broken bone in his right hand. Atlanta Braves first baseman Fred McGriff owns the second-longest streak at 295 games. 3161 !GCAT !GSPO Portuguese international Fernando Couto said on Monday he had signed a four-year contract with Spanish club Barcelona. Speaking on Portugal's TSF radio from Barcelona, Couto said he would leave Italian Serie A side Parma to join compatriots Luis Figo and keeper Vitor Baia at the Catalan club. Portuguese newspapers have speculated the defender's transfer was worth $3.3 million. 3162 !GCAT !GSPO Dutch coach Guus Hiddink on Monday recalled midfielder Wim Jonk after a 14-month absence for a friendly against World Cup holders Brazil in Amsterdam on Sunday. Feyenoord midfielder Jean-Paul van Gastel was also named to make his debut in the 18-man squad. Hiddink did not name a replacement captain for Danny Blind, who announced his retirement from international soccer on Sunday. Ronald de Boer and Dennis Bergkamp are the likely contenders to lead the team. The 35-year-old Blind, who won 42 caps for the Netherlands, said he wanted to concentrate on playing for his Dutch club Ajax Amsterdam. AC Milan midfielder Edgar Davids, who was sent home early from the European championship in England after a clash with the coach, was left out of the squad. Squad: Goalkeepers - Edwin van der Sar (Ajax), Ed de Goey (Feyenoord). Defenders - Frank de Boer (Ajax), John Veldman (Ajax), Jaap Stam (PSV), Arthur Numan (PSV), Michael Reiziger (AC Milan), Johan de Kock (Schalke '04). Midfielders - Richard Witschge (Ajax), Philip Cocu (PSV), Wim Jonk (PSV), Aron Winter (Internazionale), Jean-Paul van Gastel (Feyenoord), Clarence Seedorf (Real Madrid). Strikers - Ronald de Boer (Ajax), Gaston Taument (Feyenoord), Jordi Cruyff (Manchester United), Dennis Bergkamp (Arsenal). 3163 !GCAT !GSPO French manager Aime Jacquet, criticised after adopting defensive tactics in the European soccer championship, has selected France's two most promising strikers for a friendly against Mexico on Saturday. Olympic team members Florian Maurice and Robert Pires, both left out of Euro 96, were called up to give an attacking edge to the national side who prepare for the World Cup to be held at home in 1998. "We're starting a new two-year campaign aiming at the highest possible target in football," Jacquet said. "We can rely on the experience of Euro 96 and we want to go on with the work we have undergone there. But it is also our duty to improve, especially up front." With Maurice and Pires, who play for Lyon and Metz respectively, Jacquet has decided to bet on the future rather than to recall veterans Eric Cantona, David Ginola and Jean-Pierre Papin. "Nothing is at stake in the matches we are going to play from now on. We can thus deal freely and quietly with our attacking problems," he said. "Maurice and Pires are joining us to play and I wish to use them as much as I can." For the first time in the history of French soccer, none of the five defenders called up by Jacquet plays in the domestic league. Squad: Goalkeepers - Fabien Barthez (Monaco), Bernard Lama (Paris St Germain) Defenders - Laurent Blanc (Barcelona), Marcel Desailly (AC Milan), Franck Leboeuf (Chelsea), Bixente Lizarazu (Athletic Bilbao), Lilian Thuram (Parma). Midfielders - Didier Deschamps (Juventus), Vincent Guerin (Paris SG), Christian Karembeu (Sampdoria), Sabri Lamouchi (Auxerre), Reynald Pedros (Marseille), Zinedine Zidane (Juventus). Forwards - Youri Djorkaeff (Internazionale), Patrice Loko (Paris SG), Florian Maurice (Lyon), Nicolas Ouedec (Espanol), Robert Pires (Metz). 3164 !GCAT !GSPO Linford Christie may extend his Grand Prix career to run in a "dream team" relay with the world's fastest sprinters in Berlin on Friday, race organisers said on Monday. A special 4x100 metres relay in honour of Jesse Owens, who 60 years ago won four Berlin Olympic gold medals, will be led by Olympic champion Donovan Bailey of Canada and silver medallist Frankie Fredericks of Namibia. Race director Rudi Thiel told a news conference he was negotiating with Christie and hoped the 1992 Olympic champion would be in the line-up, even though the Briton said last week's race in Brussels was to be his final Grand Prix meeting. Carl Lewis, the 100 metres Olympic gold medallist in 1984 and 1988, was going to be part of the relay as well, but had to withdraw because of a leg injury, said Thiel. He hoped to announce a replacement early this week. "Never before has a relay team like this been put together," Thiel said. "It is a tribute to Jesse Owens who remains a role model for many track stars today. They wanted to underscore that with their participation in this race." Owens's memory is regularly evoked at the Berlin meeting. The black American's four gold medals at the 1936 Olympics shattered Nazi leader Adolf Hitler's hopes of showcasing the supposed superiority of the Aryan race. Thiel said if the dream team run a world record time in the relay, it will not be officially recognised by national athletic associations. "But you can add up on your fingers what this team will be capable of," he said. Bailey, who broke the world record in the Olympic final in Atlanta, dismissed any idea that the team would take it easy. "Of course we are going to take it seriously," he said. "If you don't take it seriously you might get hurt." Asked who he thought was the best sprinter ever, he flashed a wide smile and said: "Well, I think I ran the fastest time. But as far as athletics are considered, I think Jesse Owens was the best ever." A total of 21 Olympic gold medallists, 21 silver medallists and 18 bronze winners will take part in Friday's meeting. There are still six athletes in the Golden Four series with a chance of winning 20 one-kg gold bars. The prize, worth $250,000, is shared between athletes who clinch specific events at each of the meetings in Oslo, Zurich, Brussels and Berlin. The athletes still in the hunt are Fredericks (200 metres), Denmark's Wilson Kipketer (800), American Derrick Adkins (400 hurdles), Britain's Jonathan Edwards (triple jump), German Lars Riedel (discus) and Bulgarian high jumper Stefka Kostadinova. Double olympic champion Michael Johnson, who missed Oslo and Zurich because of injury, will run the 200 metres here. Johnson won the 400 metres in Brussels on Friday. "It's always a tough battle when I get together with Michael," said Fredericks, who must beat Johnson for a share of the gold. "I am in good shape and Michael wouldn't be here if he wasn't in good shape. It will be a good race that I think I can win." 3165 !GCAT !GSPO Barcelona beat Atletico Madrid 5-2 (halftime 2-1) in the Spanish Supercup on Sunday: Scorers: Barcelona - Ronaldo (5th and 89th minutes), Giovanni (31st), Pizzi (73rd), De la Pena (75th) Atletico Madrid - Esnaider (37th), Pantic (57th, penalty) Attendance 30,000 3166 !GCAT !GSPO Reinhard Libuda, known as the greatest winger ever seen in German football, died of a heart attack on Sunday aged 52. Libuda, whose mazy dribbling skills earned him the nickname Stan after England's great post-war forward Stanley Matthews, was capped 26 times for Germany and played in the team which reached the semifinals of the 1970 World Cup. He spent his German club career with Schalke and Borussia Dortmund, scoring the goal which won the 1966 European Cup Winners' Cup for Dortmund against Liverpool. Even today, older German fans remember a legendary piece of graffiti which came to symbolise their affection for Libuda. A poster in his home town of Gelsenkirchen advertised for recruits to a religious group with the slogan "Nobody gets around Jesus", to which the fans added the rider " -- except Libuda". Libuda's fortunes went into decline after 1972, when he received a lifetime ban from the German federation for involvement in a league bribery scandal. The ban was later lifted, but Libuda failed to establish a career for himself outside football, and turned to drink. The last two years of his life were marked by a struggle against cancer, and he died a lonely and impoverished figure. 3167 !GCAT !GSPO Results of soccer matches in the Danish super league over the weekend. AB 2 Silkeborg 3 Aarhus 3 FC Copenhagen 1 Brondby 2 Aalborg 0 Herfoelge 1 Hvidovre 0 Lyngby 2 Odense 1 Vejle 1 Viborg 1 Standings (tabulated under played, won, drawn, lost, goals for, against, points): Brondby 6 6 0 0 15 4 18 Aalborg 5 4 0 1 14 4 12 Aarhus 6 3 1 2 13 10 10 Lyngby 6 3 0 3 13 13 9 FC Copenhagen 6 2 2 2 9 9 8 Silkeborg 4 2 1 1 7 6 7 Odense 6 2 0 4 7 12 6 Herfoelge 6 2 0 4 3 10 6 Vejle 6 1 2 3 10 10 5 Hvidovre 5 1 2 2 4 5 5 AB 6 1 2 3 8 14 5 Viborg 6 1 2 3 6 12 5 3168 !GCAT !GSPO Result of an Austrian first division soccer match played on Sunday: SV Ried 0 SV Salzburg 4 Standings (tabulated under played, won, drawn, lost, goals for, against, points): FC Tirol Innsbruck 6 4 2 0 13 5 14 SV Salzburg 6 4 2 0 8 1 14 Austria Vienna 6 4 2 0 9 5 14 Sturm Graz 6 2 3 1 8 5 9 GAK 6 1 3 2 8 10 6 Rapid Wien 5 0 5 0 3 3 5 SV Ried 6 1 1 4 6 9 4 Linzer ASK 5 0 3 2 4 8 3 Admira/Wacker 6 0 3 3 5 10 3 FC Linz 6 0 2 4 1 9 2 3169 !GCAT !GSPO Australia totally outclassed an inexperienced Zimbabwe to win the opening match in the four-nation Singer World Series cricket tournament by 125 runs on Monday. Steve Waugh hit a rapid 82 as Australia scored 263 for seven off 50 overs and Zimbabwe were then dismissed for 138 in 41 overs with only four of their players reaching double figures. Only veteran opening batsman Ali Shah making any sort of impression for Zimbabwe with a top score of 41 off 78 balls. Australian off-spinner Mark Waugh wrapped up the Zimbabwe innings by claiming the last three wickets, including two off successive balls. However, it was twin brother Steve Waugh who took the man of the match award after he launched a late assault on the Zimbabwe bowlers which saw 144 runs coming from the last 20 overs. He hit three sixes and five fours in his 70-ball innings. The other main contributions came from Michael Slater, with 50 off 69 balls, and Ricky Ponting who hit 53 from 82 deliveries without once reaching the boundary. Medium-pacer Guy Whittall was the pick of the Zimbabwean bowlers taking three for 53 off his 10 overs. India and hosts Sri Lanka are the other teams in the tournament. 3170 !GCAT !GSPO Australia beat Zimbabwe by 125 runs in the first match of the Singer World Series one-day (50 overs) cricket tournament on Monday. Scores: Australia 263-7 in 50 overs, Zimbabwe 138 all out in 41 overs. 3171 !GCAT !GSPO Scoreboard in the Singer World Series one-day (50 overs) cricket match between Australia and Zimbabwe on Monday: Australia M.Slater c P.Strang b Whittall 50 M.Waugh b P.Strang 18 R.Ponting c and b Whittall 53 S.Waugh c Campbell b Whittall 82 S.Law b Streak 20 M.Bevan c Campbell b Brandes 9 I.Healy b Brandes 5 B.Hogg not out 11 Extras (b-1 lb-8 w-3 nb-3) 15 Total (for seven wickets - 50 overs) 263 Fall of wickets: 1-48 2-92 3-167 4-230 5-240 6-242 7-263 Did not bat: P.Reiffel, D.Flemming, G.McGrath Bowling: Streak 10-1-50-1 (2w, 2nb), Brandes 10-1-47-2 (1w), P.Strang 9-0-41-1, Flower 6-0-28-0, Whittall 10-0-53-3 (1nb), Decker 3-0-17-0, Shah 2-0-18-0 Zimbabwe A.Shah c M.Waugh b Hogg 41 G.Flower c Ponting b Flemming 7 A.Flower lbw b Flemming 0 A.Campbell lbw b McGrath 9 C.Wishart c Healy b Reiffel 0 G.Whittall b Reiffel 11 C.Evans c Healy b S.Waugh 15 M.Dekker not out 8 P.Strang b M.Waugh 9 H.Streak b M.Waugh 0 E.Brandes c Hogg b M.Waugh 17 Extras (lb-4 w-10 nb-7) 21 Total (all out - 41 overs) 138 Fall of wickets: 1-16 2-16 3-33 4-35 5-56 6-98 7-100 8-120 9-120 Bowling: McGrath 7-2-13-1 (2w), Flemming 7-0-24-2 (3w, 3nb), Reiffel 6-1-23-2 (2nb), S.Waugh 7-2-24-1 (1nb, 2w), Hogg 9-2-26-1 (1nb, 3w), M.Waugh 5-1-24-3 Result: Australia won by 125 runs. 3172 !GCAT !GSPO Australia scored 263-7 in their 50 overs against Zimbabwe in the first day-night limited overs match of the Singer World Series tournament on Monday. 3173 !GCAT !GSPO Australia won the toss and decided to bat against Zimbabwe in the first day-night limited overs match of the Singer World Series tournament on Monday. Teams: Australia - Mark Waugh, Michael Slater, Ricky Ponting, Steve Waugh, Stuart Law, Michael Bevan, Ian Healy (captain), Brad Hogg, Paul Reiffel, Damein Fleming, Glenn McGrath. Zimbabwe - Alistair Campbell (captain), Andy Flower, Grant Flower, Guy Whittall, Craig Evans, Eddo Brandes, Heath Streak, Paul Strang, Craig Wishart, Ali Shah, Mark Dekker. 3174 !GCAT These are the leading stories in the Malawi press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - DAILY TIMES - The government controlled radio, Malawi Broadcasting Corporation (MBC), has fired reporter Hastings Maloya and suspended editor Francis Chikunkhuzeni for running a story about a campaign rally held by the opposition Malawi Congress Party (MCP). The story contained no attack against the ruling United Democratic Front (UDF) government but called for unity among political parties. However, MBC management claim the rally did not take place. - - - - THE NATION - Malawi police are holding three men who testified to have poisoned a man and buried him before he died. The three told police that they buried the victim in a sitting position in a child's fresh grave saying the motive for the killing was to steal his pick-up vehicle which he brought from South Africa. - Malawi immigration authorities on Saturday deported two Asians for entering the country illegally. Immigration chief Martin Mononga said three more will be deported on Wednesday this week aboard the Ethiopian airline after failing to produce documents to allow them to live in Malawi. 3175 !GCAT !GCRIM Jails in all nine of South Africa's provinces are overcrowded, with those in Western Cape province crammed with 44 percent more inmates than they were designed to hold, prisons minister Sipo Mzimela said on Monday. Mzimela, in a written answer to a parliamentary question, said overcrowding stood at 40.5 percent in Northern Province and 33.3 percent in North West Province. Jails in Mpumalanga were the least overcrowded at 12.4 percent, he said. He gave no figures for the actual number of inmates. Police complain that they could arrest more criminals in their fight against the country's spiralling crime problem but there would be no room for them in jail. 3176 !GCAT !GCRIM !GPOL South Africa's ruling African National Congress said on Monday it would hold a high-level meeting to tackle spiralling crime that has scared off foreign investors and prompted some communities to take the law into their own hands. The party said in a statement the two-day meeting in Cape Town at the weekend would be attended by the national ministers of police, defence and justice. It said the aim was to facilitate "coordination and strategising" of security issues. Representatives of the prisons and intelligence services would also attend. Foreign investors have warned South Africa they will pull out of the country if nothing is done to halt violent crimes such as car hijackings and armed robbery in which business leaders and tourists are often targetted. Crime is cited one of the leading causes for an exodus of skilled South Africans to other countries. Many Moslem communities throughout South Africa have formed anti-crime organisations and staged marches on the homes of suspected criminals. During one such march in Cape Town earlier this month, a gang leader was shot and burned to death. 3177 !GCAT !GDIP President Nelson Mandela told Taiwan's visiting Vice Premier Hsu Li-teh on Monday that South Africa would stand by his country but wanted to improve relations with both it and China. But he showed no support for Taipei's renewed bid to be readmitted to the United Nations, which has recognised Beijing as the sole China for a quarter of a century. Mandela inherited diplomatic relations with Taipei from the old apartheid regime. Beijing refuses to recognise any country that has ties with the island it regards as a renegade province. "It would be a man who has no morality," Mandela said, who would take financial support from Taiwan as he had and then turn round once in power and say "we want nothing to do with you, we are going to cancel diplomatic relations with you". "I will not be guilty of that," he told reporters in Pretoria after hosting Hsu for lunch, a show of diplomatic support that many world leaders, anxious to keep in Beijing's good books, could not countenance. "He assured us that the relationship between South Africa and the Republic of China (Taiwan) is firm. He will support us whatever we are doing," Hsu, who arrived on Monday on a nine-day trip with a business delegation, told reporters. Mandela, 78, said he hoped his loyalty to Taiwan which helped fund his African National Congress so it could fight the 1994 elections, would not alienate its huge Communist rival. "We would like to improve our relations with both countries," he said. "We would like to establish diplomatic relations with the People's Republic of China (PRC)." Beijing has made clear that is impossible while Taipei enjoys diplomatic recognition. It has maintained hostility to Taipei since a 1949 civil war that split China into the Communist mainland and Nationalist Taiwan. "Nobody can ignore a country like the PRC which has a population of over one billion," Mandela said. "It was one of the greatest developments in international relations when the PRC was admitted to the United Nations and we welcome that," he added. Taiwan last week launched its latest drive for a U.N. seat, annoying China which is sure to veto it. "Our purpose is to seek the basic rights of 21.3 million people in the Taiwan region and an appropriate representation in the United Nations," the Taipei foreign ministry said. Beijing took China's U.N. seat from Taipei in 1971 and has intensified its drive to isolate Taiwan's government. South Africa is the biggest of Taiwan's diplomatic allies whose numbers dwindled to 30 this month when the West African state of Niger swapped sides. The United States recognises Beijing but has remained warm towards Taipei. China demanded on Monday that the United States cancel fresh plans to sell Stinger missiles, launchers and other weapons to Taiwan to prevent "new damage" to Sino-U.S. relations. 3178 !GCAT !GCRIM !GPOL A South African judge began to read out his verdict on Monday against an old-guard policeman who says he was apartheid's slickest killer. Eugene de Kock, who commanded a ruthless hit-squad unit and squealed on his former operatives this year to save his own skin, faces 121 charges from murder to arms offences arising from three decades of trying to uphold white supremacy. He has pleaded not guilty to all the charges, including eight of murder, but even his own lawyers -- before the trial is over -- said the evidence against him was strong. "De Kock's plea is not guilty but we conceded on the state's evidence that he might be guilty of at least five of the eight murder charges," defence attorney Schalk Hugo told Reuters. Judge Willem van der Merwe, who was aided throughout the two-year non-jury trial by two lay assessors, began the judgment in Pretoria's Supreme Court by reviewing evidence brought against de Kock on various fraud charges. Legal officials said the actual verdicts could come on Monday but could equally take several days. A counter-insurgency colonel who also had a hand in doomed white fights to cling to power across southern Africa, de Kock will be the highest-ranking apartheid security official to hear a judge pronounce his fate. His trial began shortly after President Nelson Mandela's election in April 1994 and revealed the depth of the ousted government's dirty tactics against its black opponents. Accusations against his unit include massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police. Asked by lawyers at another trial where he gave evidence if he agreed he was the security force's "most effective assassin", de Kock answered: "Yes, I would say that would be correct." 3179 !GCAT This is the leading story in the Mozambican press on Monday. Reuters has not verified this story and does not vouch for its accuracy. NOTICIAS - At least 20 people were killed when the two trucks in which they were travelling collided at Nhamavila about 160 km north of Maputo on Saturday, the Maputo daily Noticias said. 3180 !GCAT These are the leading stories in the South African press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - BUSINESS DAY - Management-level public servants have qualified for salary increases ranging between 14 and 42 percent from July, says the Public Service Commission. - Malbak has given the go-ahead for a full unbundling of its 6.5 billion rand empire. - Government signalled on Friday that it wanted to keep a lid on interest rates by reducing the ammount of Treasury bills on offer at the weekly tender by 300 million rand. - A government-backed study into the carbon steel industry has slated Iscor's domestic pricing policy and the steel firm's poor service to local buyers. - More than 180 people have been arrested following a shoot-out near Rustenburg on Friday which left five sacked Anglo American Platinum workers dead and more than 50 injured. - Primedia is in advanced talks to sell a stake in the media group to its radio venture consortium partners. - - - - BUSINESS REPORT - Industrial holding group Malbak will unbundle by distributing its underlying investments to shareholders. - A huge quantity of medicine stolen from state warehouses and hospitals was seized last week in a raid by a team of private investigators. - Disgruntled ferralloy producers will decide within the next few weeks whether to bypass Richards Bay and build a new terminal at Maputo harbour. - - - - THE STAR - Business Against Crime takes the fight against criminals to grassroots on Monday with the national launch of a new initiative aimed at helping the 100 most needy police stations in the country. - Springbok rugby coach Andre Markgraaff could be fired after the team's 2-0 series defeat by the All Blacks and a record of just two victories in the last eight Test matches. -- Johannesburg newsroom +27 11 482 1003 3181 !GCAT !GDIP !GPOL The Polish government sent Deputy Transport Minister Tadeusz Szozda on unpaid leave on Monday after he drove into the country from Russia without stopping at a passport checkpoint, PAP news agency reported. The agency quoted Deputy Prime Minister Roman Jagielinski as saying that Szozda would stay on leave pending the result of prosecutors' investigations into the incident on Friday. Szozda and several other top ministry officials were in two government cars which failed to stop at passport control on the border with Russia's Kaliningrad enclave and were only halted, deep inside Poland, after an hours-long police operation. Finally several police vehicles blocked the road and set up spiked barriers near the northern town of Nidzica, before halting the cars and taking them back to the border. Tests showed the drivers of the cars were sober. Szozda told a news conference that the cars had driven slowly through the border control but had not stopped because there did not seem to be any border officials present. PAP said Szozda denied newspaper reports quoting his companions as saying they had failed to notice the checkpoint. "We could see the checkpoint perfectly clearly, we were holding our passports, but there were no officials," he said. 3182 !E51 !E511 !E512 !ECAT !GCAT !GTOUR The Czech merchandise trade deficit jumped 16.4 billion crowns in July, the largest monthly increase in the country's history, but forecast tourism revenue and the structure of imports tempered analysts' concerns. The Czech Statistical Bureau (CSU) said on Monday that the July increase put the seven-month trade deficit at 85.3 billion crowns, after a 14 billion crown shortfall in June drove the half-year deficit to 68.87 billion crowns. "This shows that the trade gap is still widening, this is the bad news," said Radek Maly, economist at Citibank Prague. "But when you look at the actual composition of the deficit... a large part of this is stemming from the investment needs of Czech industry." Imports between January to July grew 15.9 percent over the same seven-month period last year, while exports, hampered especially by lower demand in Germany, were up only 7.2 percent, the CSU said. "Exports are lagging behind our expected growth rate," said Patria Finance economist Martin Kupka. "But the services balance will help improve the account." Machinery and transport equipment accounted for 52.5 billion crowns of the total seven-month deficit, while the balance for consumer goods actually showed an 857 million crown surplus, despite a sharp increase in domestic demand. Comments by the Czech National Bank Governor Josef Tosovsky on Friday ruling out a devaluation of the crown to boost exports convinced analysts that the central bank was not overly concerned with the overall Czech balance of payments picture. "There really isn't a strong convincing reason why (the crown) should be devalued at this point of development," Kupka said, adding that the country's capital account surplus still should comfortably cover the current account deficit. The services balance will be especially helped by the expected expansion of income from tourism, as strong first half revenues raised forecasts for total income from tourism in 1996 to $3.2 billion to $3.5 billion after $2.6 billion in 1995. "The overall balance of invisibles (services including toursim) for this year should be around $1.8 to $1.9 billion, which will decrease the current account deficit," Maly said. Economists are forecasting the 1996 current account deficit at between five to six percent of gross domestic product, compared with about four percent last year. The overall number of tourist visits in the country was up 9.3 percent in the first half, year-on-year, and airport arrivals were up 48.4 percent. Czech National Bank balance of payment figures for the first half of the year -- which will give clearer picture of the balance of services -- are expected to be released in the early weeks of September. The tourism component of the first quarter balance of payments showed a net income of $261 million, on total tourism revenue of $581 million. The overall current account however, posted a $505 million deficit in the first quarter. -- Prague Newsroom, 42-2-2423-0003 3183 !GCAT !GPOL Albania's Socialist Party, the successors to communists, dumped Marxist doctrine and officially condemned the former Stalinist dictatorship in the biggest push for reform since the fall of communism in 1990. About 600 delegates ended a two-day congress by voting unanimously on Sunday to back sweeping changes to a party once regarded as the most hardline among Eastern Europe's communist states. "We have dropped from our previous programme all references to Marxist philosophy as a theoretical source of the Socialist Party," said Ermelinda Meksi, a senior official of Albania's main opposition party. In an historic step, the congress backed a proposal which officially condemned the 45-year communist regime of Stalinist leader Enver Hoxha for denying democratic values and human rights and for carrying out political persecutions. "We propose the decisive and irrevocable detachment from the dictatorial regime of Enver Hoxha and its continuity under (last communist president) Ramiz Alia," Meksi said, reading out a recommendation later backed by delegates in a vote. The congress, shifting direction to a more Social Democratic vision, agreed that party reform was needed to keep in step with the social and economic changes in the Balkan state. Meksi said the party would help to stimulate the private sector, support legitimate private business and back private ownership of land. Delegates also voted to retain jailed Socialist leader Fatos Nano as party chairman and issued a fresh appeal for his release. Nano has three years left to serve of a prison sentence imposed for embezzlement. Nano, in an address read to delegates on Saturday, urged members to reform the party and criticised the current leadership for resisting change. Acting leader Servet Pellumbi resigned despite calls from the congress floor for him to stay. "I cannot remain any longer because my concept for building the party differs greatly from those of the chairman (Nano)," he said. Many in the party praised Pellumbi leading its campaign in disputed general elections in May, boycotted by most opposition parties which accused the ruling Democrats of President Sali Berisha of rigging the poll. The congress said the Socialists should maintain their stand against taking up the handful of parliamentary seats they won in the election. Most opposition parties have also threatened to boycott local polls on October 20, arguing that an electoral commission set up by Berisha is biased in favour of the ruling party. The United States urged the Democrats on Friday to give a bigger role to the opposition parties in preparing for the elections, to adopt a new constitution and to hold fresh general elections at the earliest opportunity. Despite the show of party unity, some Socialist delegates were critical of Nano, accusing him of being out of touch in an isolated prison in the southern town of Tepelena. One senior Socialist said that although Nano had attacked the current leadership for resisting change, he had also urged the congress to nominate officials who had served under the last communist regime to a top policy-making body. 3184 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Canadian Auto Workers union president Buzz Hargrove said on Monday he has no interest in discussing with the Big Three North American carmakers agreements that are longer than the traditional three years. Hargrove said the CAW is more likely to seek one-year agreements rather than long-term deals the Wall Street Journal reported the car makers are discussing with the United Auto Workers union in the U.S. "All I can tell you is that is not going to happen in Canada," Hargrove said in reaction to the report. "We're looking at a one-year agreement not a five-year." Hargrove cast doubts on the UAW's interest in such long-term deals with the auto companies. He said UAW president Stephen Yokich showed little interest in long-term contracts when Hargrove quizzed him on the subject during a visit to the CAW convention earlier this year. "I raised it with him when he was over at the convention and he certainly didn't seem that he was interested at that point," He said. Hargrove said the bargaining strategy for the CAW would not be affected this year or in future years even if the UAW did sign long-term agreements with the auto makers. "I don't see it as a problem at all," Hargrove said. "We're living in a different world here." Hargrove said cost advantages in Canada would likely prohibit the car companies from using long-term agreements in the U.S. to fight the Canadian union's demands over outsourcing. "They have a C$10 labor cost advantage in Canada and I'm not sure a long-term agreement offsets the major advantages they have in cost, productivity and quality in Canada," Hargrove said. On Wednesday, the CAW is expected to announce the company it has chosen as a strike target for bargaining. Traditionally, the CAW chooses one of the companies to seek a master agreement as a framework for its labor contracts with all three. Hargrove said he will press ahead with announcing his target despite a Thursday announcement from the UAW in the U.S. that it has not yet chosen its bargaining target. It would be the first time the CAW had chosen a strike target before the UAW and could rob the Canadian members of bargaining power if both chose the same target. On Sunday, the CAW said its members voted overwhelmingly to give union leadership the authority to call a strike to back contract demands. -- Paul Casciato (416) 941-8100, or e-mail: paul.casciato@reuters.com 3185 !C12 !CCAT !GCAT !GCRIM Caterpillar Inc said it filed a lawsuit on Monday against Deere & Co alleging infringement of Caterpillar's patent on a rubber-belted agricultural tractor. Caterpillar said it also alleged in the U.S. District Court for Northern Illinois unfair competition by Deere "by using the Caterpillar product configuration trademark." A Deere spokesman said the company had not seen the lawsuit and had no comment. Caterpillar said it won a patent in 1994 on its Challenger rubber-track agricultural tractor, which it said gets better traction and causes less soil compaction than other tractors. "It's ironic that after years of telling customers that tires are better than rubber track, Deere's designers have now decided to adopt the successful and patented rubber-track design," said Caterpillar vice president Dick Benson. The company said it seeks to stop Deere permanently from infringing on the patent, the trademark rights and seeks monetary damages. -- Chicago Newsdesk 312-408-8787 3186 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Micronics Computers Inc said on Monday that it cut 55 workers as part of a larger restructuring effort. Micronics, which supplies high performance system boards and multimedia peripherals for personal computers, said a large number of cuts involved assembly line positions. Micronics also said its vice president of sales, Larry Lummis, left the company. William Crouch, who joined Micronics in early August as the vice president of marketing, will now oversee all sales and marketing efforts for the company's product lines, the company said. -- New York Newsdesk 212-859-1610 3187 !C13 !C24 !CCAT !GCAT !GENV Homestake Mining Co said Monday the U.S. Environmental Protection Agency has removed Whitewood Creek in western South Dakota from its priority list of hazardous or potentially hazardous waste sites. In 1990, Homestake entered into a consent decree with the EPA under which the company agreed to take certain remedial actions in the area. "We are very pleased with this action by the EPA. It is the culmination of 13 years of cooperative effort by the EPA, South Dakota and Homestake, the cost of which was fully funded by Homestake," said Jack Thompson, chief executive. 3188 !C41 !CCAT !GCAT !GPRO Federal-Mogul Corp said Monday the August 20 coronary bypass surgery on Dennis Gormley, chairman and chief executive officer, was a success. It said Gormley is recuperating and expected to resume his corporate duties within a month. -- Chicago newsdesk 312 408-8787 3189 !C24 !CCAT !GCAT !GENV Tennessee Valley Authority (TVA) is seeking comments on what should be covered in an environmental study on the proposed construction of a 750 megawatt (MW) natural gas power plant, TVA said Monday. The utility will hold on September 5 a public meeting in Batesville, Miss., where the station would be built, it said. TVA said it expects to release the final environmental review on the project by May 1997, following public review of the draft. Public comments from the open forum will be considered in preparing the draft. A schedule for preparing and releasing the draft has yet to be determined. Earlier this year, TVA signed an option to buy electricity generated at the plant. The environmental study, TVA said, will be a critical part of its analysis in determining whether to exercise that option. --New York Power Desk +1 212 859 1622 3190 !C42 !CCAT !E41 !ECAT !GCAT !GJOB AMR Corp's American Airlines and its pilots moved into a crucial phase of labor negotiations on Monday with no agreement so far on the central issues of pay and work rules, officials from both sides said. The Allied Pilots Association (APA), which has threatened strike action if mediated negotiations fail to bring a new contract deal, rejected the airline's latest proposal over the weekend and came back with its own counterproposal. "I'd say this week is key," said APA spokesman Gregg Overman. "It is possible there will be some form of resolution, whether it is an impasse or a tentative agreement, as soon as this week," Overman said. If the National Mediation Board were to declare an impasse, both sides would begin a 30-day "cooling-off" period. Once that period ended, they would be free to engage in "self-help" moves such as a strike, although binding arbitration would begin if both sides agreed on it. Talks moved from Orlando to Washington this month and the two sides have since thrashed out agreements on pensions and a string of minor issues. American's negotiators have dropped their original demand for a two percent pay cut, but still want a four-year wage freeze and the right to pay 20 percent of its 9,400 pilots up to 30 percent less than currently and assign them to its small-aircraft unit. Airline officials say competitors have already taken similar measures and that it must follow suit to stay in the game. "Basically, we are just trying to be competitive," spokesman Al Comeaux said. "A competitive American is the best assurance of job security for everyone." APA negotiators have demanded pay increases of five percent a year, retroactive to August 31, 1994, and insist they will not back down on the "small-airplane proposal". "As I've said before, this is something I will not accept...This simply will not happen," APA president Jim Sovich said on Sunday in a recorded hotline message to members. He said the airline's latest proposal was little changed from its previous offers. The contract negotiations began in mid-1994, but moved at a snail's pace until mediators were brought in earlier this year. Another dispute revolves around American's marketing agreements with Reno Air Inc and Midway Airlines Inc, under which American allows those carriers to give American AAdvantage frequent-flier miles to their passengers. The APA, pointing to the "scope" clause of the existing labor contract, says American Airlines receives revenues from those flights and so wants them flown by its members. 3191 !C12 !CCAT !GCAT !GCRIM A class action lawsuit has been filed by a group of shareholders against Pepsi-Cola Puerto Rico Bottling Co, two law firms said Monday. The law firms, Vincente & Cuebas, and Nachman Santiago & Guillemard of San Juan, Puerto Rico, said the company violated federal securities laws by misrepresenting or making material omissions about its financial condition between September 19, 1995 and August 15, 1996. The lawsuit seeks to recover damages on behalf of all purchasers of the company's Class B common stock between those dates. 3192 !C12 !C13 !CCAT !GCAT !GCRIM !GENV If successful, the first-ever lawsuit filed by a company seeking compensation for double-hull requirements imposed by the Oil Pollution Act of 1990 could spawn a pile of similar cases, potentially costing the U.S. government millions, industry officials said Monday. The lawsuit was filed by Maritrans Inc, which sought $200 million under the fifth amendment of the U.S. Constitution, and the government must respond to it by Oct 7. The fifth amendment specifically prohibits the taking of private property for public use without just compensation. 3193 !C12 !CCAT !GCAT !GCRIM Identix Inc said a U.S. federal court in California has ruled that its TouchPrint-600 fingerprint-imaging machine does not infringe on a patent held by Digital Biometrics Inc. The ruling disposes of Digital Biometrics case against Identix, the company said in a statement. 3194 !C12 !C24 !CCAT !GCAT !GCRIM El Paso Electric Co said on Monday a judge found that the city of Las Cruces, N.M. did not meet the burden of proof to condemn a property that accounts for seven percent of the utility's revenues. However, U.S. Magistrate Leslie Smith decided seek a ruling from the New Mexico Supreme Court as to the city's authority to condemn the utility's property for use as a municipal electric utility when the site is devoted to a public use. El Paso spokesman Henry Quintana Jr. said the utility, which had 1995 revenues of $545 million, proved to the court that its operations to provide electricity to neighboring towns would be harmed if the property were condemned. The property contains electrical transmission systems and some substations, Quintana said. 3195 !C33 !C331 !CCAT !GCAT !GDEF Thermo Electron Corp said Monday a subisidiary has received a $5 million contract from the U.S. Army to develop a new generation of portable, hand-held mine detectors. Under the contract, Coleman Research Corp will deliver 10 mine-detection systems by spring 1998. Testing is to be conducted by the Army in a subsequent six-month period. Coleman also has received a $450,000 contract to provide prototypes of the hand-held mine detectors to the Army to be tested for use in Bosnia. The prototypes are to be delivered in three months, with testing in the following six weeks. 3196 !C12 !CCAT !GCAT !GCRIM Black & Decker Corp said Monday a federal court jury in Virginia ruled in its favor on August 23 and awarded it $3.7 million in a patent infringement suit brought against Coleman Co Inc. The patent dispute involved Black & Decker's "SnakeLight" flexible flashlight. Black & Decker claimed its product was infringed by a Coleman product imported from China. Reuters Chicago Newsdesk - 312-408-8787 3197 !C12 !C18 !C181 !CCAT !GCAT !GCRIM USA Waste Services Inc said on Monday it closed a $118 million deal to acquire Philip Environmental Inc's municipal and commercial non-hazardous solid-waste businesses in Quebec and Ontario, Canada, and in Michigan. However, Laidlaw Inc, which had right of first refusal to acquire the Quebec solid-waste business, has filed a lawsuit against USA Waste and Philip in connection with the deal, USA Waste said. USA Waste said it thought Laidlaw's action was without merit and that it would vigorously defend against it. Philip has agreed to indemnify USA Waste for all costs, expenses and damages related to the suit. Five landfills, six collection operations and six transfer stations have been acquired. The facilities have annualized revenues of about $50 million, the company said. On July 30, USA Waste said it offered to buy the businesses for $118 million in a combination of common stock and cash. 3198 !C12 !CCAT !GCAT !GCRIM Nutrition For Life International Inc said Monday a lawsuit has been filed against the company and its officers, accusing them of engaging in an illegal pyramid scheme. Also named as defendants are Kevin Trudeau, a key distributor of the company, and Trudeau Marketing Group Inc. The class action was filed in behalf of individuals who became "instant" executive distributors of the company and individuals who purchased the company's common stock between October 19, 1995, and April 24, 1996, the company said. 3199 !C13 !C23 !CCAT !GCAT !GHEA Helionetics Inc said its majority owned unit, Acculase, has won approval from the U.S. Food and Drug Administration to start human clinical tests of an excimer laser for transmyocardial revascularization (TMR) procedures. Helionetics also said AccuLase will start planning global marketing of the TMR system, which uses an AccuLase-patented short-pulse excimer laser technology. A total of 30 human trials will be conducted at New York Hospital-Cornell Medical Center in New York and at The Heart Institute of Good Samaritan Hospital in Los Angeles. The first trail should begin in September at New York Hospital. TMR treats patients afflicted with coronary heart disease by using a laser to create channels through the heart muscle. The channels allow oxygen-rich blood from the main pumping chambers to flow to oxygen-starved areas of the heart. Helionetics owns 75 percent of Laser Photonics, which in turn owns 75 percent of AccuLase, according to AccuLase General Manager Ray Hartman. 3200 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Union workers at Tosco Corp's shuttered Trainer, Pa., refinery will vote Friday whether to ratify a tentative six-year collective bargaining pact announced Monday by the company and union officials. Union leaders would not speculate on what decision workers will make, but noted the agreement is bittersweet in that many union jobs will be lost under the tentative deal. "This is not a joyous occasion, but some people will get back to work," said Denis Stephano, president of OCAW local 8-234. "Around 70-100 people will lose their jobs. For the start-up they want 216 people. Obviously, we want as many people and will continue to work for getting more people back," Stephano added. Exact union losses are confused due to retirements and workers moving to find new jobs after the refinery was idled. Tosco purchased the 172,000 barrels per day (bpd) refinery--formerly called Marcus Hook--from British Petroleum Co Plc for $60 million in February, along with BP's 500-station East Coast retail network. The plant has been mothballed since that time after union workers and Tosco failed to reach agreement on new work procedures and staffing levels. Stephano said under the previous owners there were 320 union positions, out of a total workforce of 520. Now, Tosco and the union have tentatively agreed to the 216 union slots out of total 360 workforce. Besides streamlining operations, Tosco has also won the right to hire any worker it wants from the union pool, defeating the OCAW demand that seniority take precendence. "There is no seniority unfortunately. Workers don't have that protection in this country. Tosco is the process of deciding who to hire, but to my knowledge no one has been given a job offer yet," Stephano said. Tosco moved to reopen the refinery after commissioning a study by Bechtel Corp, on whether it was possible to turn a profit at Trainer, something BP could not achieve. In July, the results of the Bechtel study showed the refinery could indeed make money, depending on union ratification of smaller staffing levels, and other operational improvements and adjustments. Tosco has said it would invest $110 million in the plant, $50 million of which would be used to modernize operations, and hopes to have Trainer back in operation by the summer of 1997, pending peace with the labor union. Stephano said money and benefit terms in the Tosco package will adhere to the national package. Around 300 union members were expected to vote Friday. Stephano said the vote will be by secret ballot and last until early evening. An announcement on the vote tally will be made late Friday night, he said. If the vote is for ratification, Stephano said meetings will be held with Tosco officials next week to determine timetables for getting people back to work. After 30 days, the company and union would meet to discuss the employment situation. -Patrick Connole, New York Energy Desk, + 1 212 859 1828 3201 !C12 !C13 !CCAT !GCAT !GCRIM !GHEA !GPOL A legislative proposal to give cigarette makers immunity from liability suits in return for partially reimbursing states for health costs received a cool reception Monday from both the tobacco industry and its opponents. The proposal, according to a report in Monday's Wall Street Journal, would give cigarette manufacturers immunity from liability suits for 15 years and exempt them from regulation by the Food and Drug Administration. President Clinton announced on Friday that the FDA would begin regulating tobacco as a drug. As outlined in the Journal, the tobacco industry would pay billions of dollars a year -- starting at $6 billion and rising to $10 billion -- to states as partial reimbursement for the cost of treating smoking-related illness. House Commerce Committee Chairman Thomas Bliley, a Virginia Republican, said more than a year ago the question of tobacco regulation was one for the courts, not Congress. Bliley aides said he continues to stand by his position and outlined a full committee schedule in the weeks before Congress adjourns in a month or so ahead of the November 5 election. Tobacco legislation was not on the list. Democrat Henry Waxman of California, a tobacco industry ciritic, who is also on the committee, said through a spokesman he strongly opposed the legislation. RJR Nabisco Holdings said in a statement that "The specifics included in The Wall Street Journal are completely unrealistic and do not merit discussion." More broadly, RJR said any law dealing with tobacco was "a very unlikely scenario." The tobacco company was also joined in its opposition by two anti-smoking groups. John Banzhaf, executive director of Action on Smoking and Health said the $10 billion annual payments by tobacco companies was "too little and too late" and charged that the cost of tobacco damage was closer to $100 billion annually. Scott Ballin, chairman of the Coalition on Smoking or Health, was equally opposed. Ballin said he had his own theory why the proposal was floated. He said Republican presidential nominee Bob Dole "has been taking a terribile beating on the issue ... I think there are a lot of Republicans who would like to see this thing go away." 3202 !C13 !C21 !CCAT !GCAT !GSCI A group of leading trademark specialists plans to release recommendations aimed at minimizing disputes over Internet address names. The International Trademark Association is working on a white paper that will be completed in the next few months, David Maher, co-chair of the association's Internet issues committee, said in a telephone interview. 3203 !C13 !C22 !CCAT !GCAT !GHEA Barr Laboratories Inc said Monday it received approval from the U.S. Food and Drug Administration (FDA) to market the 20 mg strength of Megestrol Acetate, the generic equivalent of Bristol-Myers' MEGACE cancer drug. Barr received approval for the 40 mg strength of the product last November. Megestrol Acetate is used for the palliative treatment of advanced breast and endometrial cancer. 3204 !C12 !C41 !C411 !CCAT !GCAT !GCRIM OfficeMax Inc said Monday that its vice president of human resources, Suzanne Forsythe, has withdrawn her sex-discrimination complaint against the company. OfficeMax said it did not pay a cash settlement to Forsythe. However, she will be permitted to exercise certain stock options with the termination of her employment, the company said. The complaint was filed last week, prompting an internal investigation into Forsythe's allegations against OfficeMax Chief Executive Michael Feuer. Forsythe left the company Monday by "consensual agreement," company spokesman Juris Pagrabs said. Forsythe had alleged the company routinely discriminates against blacks and women. The company said the internal probe into the sex-discrimination allegations did not reveal any violations of law. OfficeMax said it had been prepared to defend itself in court, but it preferred reaching a settlement to avoid the time and costs associated with litigation. "I regret the media coverage prompted by my press release and wish the company well," Forsythe said in a statement. 3205 !GCAT !GDIS !GWEA Typhoon Orson, with sustained winds of 115 mph, is currently located weel out ot sea near 26.2N/150.7E and is moving off to the north-northwest at 7 mph. This system is expected to increase in intensity over the next 48-72 hours and continue tracking away from land. This will only threaten shipping. Elsewhere, Tropical Storm Piper has winds of 63 mph and is located near 42.9N/160.0E and is weakening rapidly. The storm is moving off to the north-northeast at 36 mph and is expected to become extratropical within the next 6 hours. Hurricane Edouard continues to power its way through the tropical Atlantic with maximum sustained winds of 132 mph. It is centered near 17.7N/52.7W or 600 miles east of the Lesser Antilles and is moving off to the west at 15 mph. Edouard is expected to strengthen slightly and continue on its current track over the next 24-48 hours. Interests in the Leeward islands should monitor this system closely. There are no further statements at this time. 3206 !C23 !CCAT !GCAT !GHEA Atrix Laboratories Inc said Monday two Phase 3 clinical trials demonstrated that ATRIDOX, its drug delivery product for treating periodontal disease, equalled conventional mechanical scaling and root planing, but was less painful and required less treatment time. The company said it plans to submit a New Drug Application for this product in early 1997 and will file for European approval shortly thereafter. Scaling and root planing is now the most common treatment for periodontitis, a progressive disease of the gums that affects an estimated 45 million adults in the United States. The ATRIDOX product combines a biodegradable polymer with doxycycline, an antibiotic that kills bacteria associated with periodontal disease, the company said. The treatment is applied to the infected periodontal pocket as a fluid, where it molds to the shape of the problem area and solidifies, releasing the drug for a period of about seven days. The phase 3 trials were conducted at 20 dental centers across the country, and had 758 subjects who completed the nine-month study. The study design consisted of four parallel groups, ATRIDOX; placebo; scaling and root planing; and oral hygiene. These Phase 3 trials are the largest ever conducted in the area of subgingival anti-infective therapy, the company said. Analysis of trial results demonstrated three findings with respect to attachment level gain and pocket depth reduction, the two primary clinical parameters used to assess outcomes after treatment of periodontitis. First, ATRIDOX was statistically superior to placebo; second ATRIDOX was clinically equivalent to scaling and root planing; and third, both ATRIDOX and scaling and root planing were statistically superior to oral hygiene alone. 3207 !GCAT !GDEF !M14 !M142 !MCAT A government-industry committee called on the U.S. Defense National Stockpile Center to spend more time, energy and resources on enhancing its marketing and sales efforts. The goal should still be to generate revenues while minimizing undue market disruption, the government-industry advisory committee on modernization of the stockpile said in a report. The committee concluded that the single most important factor to a viable marketing methodology is the market's understanding of the Stockpile's sales procedures. "A large percentage of the existing policies and procedures should not be abandoned; rather, they should be clearly defined and their implementation consistently followed," the report said. Existing inventory needs to be categorized by quality and quantity as to its potential market value relative to commercial materials, it said. Commodities that raise environmental concerns and that have no commercial value should be segregated and discarded in a timely fashion, the report said. Marketing programs should establish a time line that includes targets and addresses both market opportunities and disruption possibilities, it said. The report also said that the the negotiated bid process was a commercially acceptable form of sale. The major elements of long-term contracts should be made public, it said. In a separate section of the report, the committee said the current Stockpile inventory was outdated and advocated a "lean and mean" Stockpile of the most modern materials and alloys. The materials should be at natural stocking points in the critical manufacturing processes in the producers' plants. "Using solutions such as rolling inventory, these critical manufacturers should be given the responsibility to maintain these materials," the report said. -- Washington Commodities Desk (202) 898-8489 3208 !C13 !C22 !CCAT !GCAT !GHEA Schering-Plough Corp said Monday it has been given marketing clearance from the Food and Drug Administration for a new once-a-day antihistamine and decongestant. The clearance was given for Claritin-D 24 Hour Extended Release Tablets. The company previously received clearance for anotehr another Claritin-D product, which is taken twice a day. Neither product contains a black-box warning. The once-a-day tablet contains 10 mg loratadine and 240 mg pseudoephedrine sulfate, while the twice-a-day version contains half of those same ingredients. 3209 !C12 !C13 !CCAT !GCAT !GCRIM E-data Corp said Monday it had narrowed the claims in its patent infringement suit against 13 companies, alleging violations of its highly controversial electronic commerce software patent. (Corrects headline and first paragraph to make clear that the suit was filed previously). The company said the suit was filed on August 23 in the U.S. District Court for the Southern District of New York before Judge Barbara Jones. Plaintiffs named in the suit include Broderbund Software Inc, CompuServe Corp, the Internet Shopping Network, a unit of Home Shopping Network Inc, Intuit Inc, and McGraw-Hill Cos Inc. 3210 !GCAT !GENT !GPRO Princess Diana on Monday denied a British newspaper report that she had agreed to be questioned by top U.S. television interviewer Barbara Walters. "The Princess of Wales has no plans at the moment to be interviewed by Barbara Walters," a statement issued by her office said. The Daily Express said Diana would take a fee of around 750,000 pounds ($1.1 million) for an interview with Walters on the ABC network's 20-20 programme to be shown in November. A spokesman for 20-20, Martin Blair, also denied that an interview was planned and said ABC would not pay for it in any case. "We don't pay anybody for interviews," Blair said from New York. The Daily Express said Walters has been trying to interview Diana for years. They have had lunch together and she has been to Diana's Kensington Palace home. Diana, who admitted infidelity during a ground-breaking interview with Britain's BBC television last year, has agreed to a confidentiality clause as part of her divorce settlement from Prince Charles. The divorce becomes final on Wednesday. ($1=.6436 Pound) 3211 !GCAT Following are some of the major events to have occurred on September 2 in history. 31BC - Mark Anthony's naval force, including a squadron of Cleopatra's, was defeated at Actium by Roman legions under Augustus Caesar. 1666 - The Great Fire of London began in a bakery in Pudding Lane. Raging for four days, it destroyed swathes of the city. 1752 - The last day of the Julian calendar in Britain and its colonies. It was replaced by the Gregorian calendar and parliament decided an 11-day discrepancy between the two would be rectified by making the following day September 14. 1778 - Louis Bonaparte, brother of Napoleon and King of the Netherlands 1806-10, born. 1838 - Hawaiian Queen Liliuokalani born. Reigning 1891-93, she was Hawaii's last sovereign before the Pacific territory was annexed by the U.S. in 1898. 1841 - Prince Hirobumi Ito, Japanese statesman and Prime Minister 1886-1901, born. 1864 - In the U.S. Civil War, Union forces under General William Tecumseh Sherman occupied Atlanta, Georgia. 1870 - Napoleon III capitulated to the Prussian forces at the Battle of Sedan, France. This led to the fall of the Second French Empire. 1898 - Lord Kitchener's Anglo-Egyptian forces decisively defeated the Dervishes at the Battle of Omdurman, Sudan. 1901 - U.S. President Theodore Roosevelt made a famous speech in which he said America should "Speak softly and carry a big stick". 1910 - Henri Rousseau, French painter, born in 1844, died in Paris. He was noted for his exotic landscapes and portraits of beasts and gypsy figures. 1923 - The first elections were held in the Irish Free State after independence from Britain. 1933 - Mathieu Kerekou, president of Benin from 1972 to March 1991, born. 1930 - Flying their plane "Point d'Interrogation", French aviators Dieudonne Coste and Maurice Bellonte completed the first non-stop flight from Europe to the United States. 1937 - Pierre de Coubertin, who was responsible for reviving the Olympic Games in 1896, died. 1945 - Aboard the U.S. battleship Missouri, Japanese leaders signed the unconditional surrender which ended World War Two. 1945 - The Democratic Republic of Vietnam was proclaimed, with Ho Chi-Minh as President. 1952 - Jimmy Connors, U.S. tennis player was born. He won many titles over a long career including being twice winner at Wimbledon in 1974 and 1982. 1963 - Alabama governor George Wallace stopped public school integration of blacks and whites by encircling Tuskegee High School with a cordon of state troopers. 1971 - The United Arab Republic reverted to its former name, Egypt. 1973 - J.R.R. Tolkien, South African-born English author, died in Bournemouth, Dorset. He was best known for his book "The Lord of the Rings". 1990 - Canadian soldiers seized control of an outpost of Mohawk Indians near Montreal, ending a 53-day armed standoff. 1993 - The Vatican accepted a Chinese invitation for a high level visit to Beijing, the first such meeting since the 1949 comunist takeover. 1994 - The Bulgarian government of Prime Minister Lyuben Berov resigned. 3212 !CCAT !GCAT !GDIS More than 100 people were safely evacuated on Monday from a ferry that caught fire soon after leaving Guernsey in Britain's Channel Islands, police said. Police said the 111 passengers and six crew on board the ferry Trident Seven, owned by France's Emeraud line, were rescued by a variety of private and commercial boats after fire broke out in the engine room soon after it left port. An 88-year-old woman was taken to hospital with leg injuries, according to a spokesman for Guernsey police. The ferry, which was towed into port, had been bound for Jersey, another in a cluster of small British-ruled islands off north-west France. 3213 !GCAT !GSPO THE AUSTRALIAN The AFL is in upheaval after a day of somewhat unlikely developments that saw the possible collapse of the Melbourne-Hawthorn merger through the emergence of two benefactors, including mining magnate Joseph Gutnick, and the shock resignation of the leagues chief investigator, Martin Amad. Page 16 -- Sydney City Roosters proved little more than shark-bait in another of the ARL's successful Monday night football matches. In front of a 23,000 strong crowd, the Roosters were somewhat static without their host of stars, including Brad Fittler, injured. Page 16 -- Canberra Raiders prop John Lomax may find himself back on the paddock as soon as next week, after it was initially feared that he would not play again this season due to a fractured bone in his hand. The fracture however is small enough to allow the kiwi to resume playing. Page 16 -- THE SYDNEY MORNING HERALD Australia seem certain to appear now before an English crowd at "Twickers", resulting in a grand slam Test series for the Wallabies at the end of the year, because of a proposed eight-day extenuation of the Wallaby tour. The Test against England may replace the traditional match against English Barbarians Club. Page 41 -- Australia made an aggressive start to their opening match against Zimbabwe in the Singer World Series tournament in Colombo, Sri Lanka, reaching 1-48 off 8 overs before a tropical storm interrupted play. Mark Waugh fell victim to Paul Strang's leg-spinner on 18 before the heavens opened. Page 41 -- Australia's disabled athletes will leave the Atlanta Paralympics having retained their status as world powers, finishing a close second to the strong-finishing USA. Australia won 42 gold medals, and 37 sliver and 37 bronze. Page 40 -- THE AGE The Big O, racing's powerhouse Octagonal, has been switched to Caulfield from Epsom in a surprise move to train for this Saturday's weight-for-age 1400 metre Memsie Stakes. Octagonal has raced only once at Caufield for a third behind Our Maizcay and Ravard. Page C6 -- Australian Olympic silver medalist Cathy Freeman has won the 200 metres at an international athletics grand prix in Sheffield, UK. The race was won in 22.53 seconds and followed the previous day's victory over arch-rival Marie-Jose Perec of France in the 400. Page C6 -- Champion Russian swimmer Alexander Popov who was stabbed yesterday in a brutal knife fight on a Moscow street, has revealed an application for Australian citizenship was to be prepared after a brief holiday in Moscow. It is now doubted that the Russian will ever return to the pool again. Page C6 -- HERALD SUN North Melbourne players looked like a beaten team before the whistle blew the end of their match against Geelong. North could not compete with an aggressive and fast-paced Cats outfit, with Leigh Colbert and Derek Hall asserting their dominance in the forwards. Page 68 -- Geelong ruckman John Barnes has agreed to a long-term contract with the Cats, ending weeks of speculation on his future. Football manager Paul Armstrong would not disclose the length of the contract, but it is believed to be three years. Page 69 -- Defending champion Greg Norman fell out of contention with two successful back nine bogeys as American Phil Mickelson jumped from the pack to win the World Golf Series by three strokes. Norman finished on 71, best of the Aussies, including Craig Parry (72 and Stewart Ginn (73). Page 66 -- THE DAILY TELEGRAPH Sydney Swans lynch-pin Tony "Plugger" Lockett has been cleared of a striking charge that was feared to cripple Sydney's AFL finals campaign. Speculation was rife that Lockett would receive a suspension for striking Essendon's Barry Young last round. Page 60 -- The relationship between the New South Wales Carr Government and the leaders of the State's A$4 billion-a-year racing industry has plummeted to an all-time low after revelations that the Government is expected to grant tax breaks for the casino and not the racing industry. Page 58. -- Australia completed a triathlon trifecta yesterday when teenagers Joanne King, Rebekah Keat and Jackie Gallagher won their respective world titles in Cleveland, USA. As a result Aussie female triathletes are now ranked as best in the world. Page 56 -- Reuters Sydney Newsroom 61-2 373-1800 3214 !GCAT !GSPO Third-seeded Wayne Ferreira of South Africa won the 13th tournament of his career on Sunday, defeating unseeded Australian Todd Woodbridge 6-2 6-4 at the Canadian Open. Ferreira, who will move from 10th to 7th in the world rankings after the victory, took home a first-prize check worth $288,000. The 24-year-old South African has won his last six meetings with the 43rd-ranked Woodbridge and Sunday he had more power and more consistency than the 26-year-old Australian. On a bright sunny afternoon, both players had to battle windy conditions. "The wind really swirls around and it's difficult to get your game to the level you'd like," said Ferreira. "Normally, I'm pretty bad in the wind and I struggle a lot. But I decided to take a little off my first serve and use my backhand slice to keep the ball low and it worked." He faced only one break point, in the second game of the match, and saved it on a Woodbridge error. "This is the biggest tournament I've ever won," said Ferreira about the ATP Tour Super Nine event. Woodbridge was broken in the opening game of the match and was so upset that he hit a ball into the front of the courtside box seats and received a warning for ball abuse from the umpire. "I was frustrated because I missed a couple of shots by just a little bit," said Woodbridge, who admitted feeling "tight" at the outset. "It was a big game in a match when you're gunning for a guy who's ranked higher than you." Woodbridge lost his serve at 2-2 in the second set and Ferreira took control, winning the title on his first match point when Woodbridge hit a forehand wide. "I think what Wayne has improved is his court mobility and his speed," Woodbridge said. "Playing him is a little like playing (American) Michael Chang because you feel it's necessary to hit the ball better and harder. He can run down awkward shots and that's an area of his game that has gotten better." "I have a trainer that travels with me," said Ferreira, who goes for a 20-minute run right after his matches to loosen up. "He keeps me working hard and that really pays off on court." At the U.S. Open, which begins Monday, both Ferreira, the ninth seed, and Woodbridge will play qualifiers. Ferreira feels very confident going into Flushing Meadows. "If I'm going to lose at the (U.S.) Open, it'll have to be to someone playing exceptionally well," he said. 3215 !GCAT !GSPO KIMBERLEY, South Africa, Aug 26 - All Blacks coach John Hart is surprised the South Africans have complained about New Zealand captain Sean Fitzpatrick allegedly stiff-arming one of their players in last Saturday's (Sunday NZ time) second rugby test, the New Zealand Press Association reported. Hart and his fellow selectors Ross Cooper and Gordon Hunter viewed the particular incident on video after Springboks' manager Morne du Plessis rang them to complain. I am very surprised it's even been raised with me,'' Hart said today. I have watched it in slow motion, I have listened to the commentary and I rang Morne back to tell him that I'm surprised in the context of the game,'' Hart said. I saw nothing wrong with the tackle at all. It was a heavy tackle in terms of (Springboks captain) Gary Teichmann coming in and ducking into the tackle and the tackle was made across the top of the shoulder and down across the arm. Du Plessis said that he had contacted Hart to pass on his and the Springboks' extreme displeasure'' with the incident, and had asked Hart to pass on the message to Fitzpatrick. However, du Plessis said the South Africans would not cite the All Blacks captain. To cite Fitzpatrick at this stage would appear to be sour grapes as well as supporting a citing system with which we are not happy,'' du Plessis said. In the past if a similar incident had taken place I have no doubt that members of our team would have been cited,'' he said. The South Africans believe an independent match commissioner should have responsibility for disciplinary matters. Currently each side can cite the other team's players for acts of violent conduct. New Zealand won yesterday's test 33-26 to take the three-test series 2-0. Hart said Fitzpatrick had not been penalised for tackling Teichmann. The statement in the papers this morning that Sean Fitzpatrick was penalised for a stiff-arm tackle is incorrect. He was penalised for being offside and the referee clearly in the video says no, only for offside''. The referee saw the incident. I'm really surprised it has been raised. I told Morne that I won't be speaking to Sean about the incident. I'm a strong disciplinarian and I've had strong standards on this tour. The team know where they stand on that.'' Hart said the South Africans complained about the All Blacks lineouts after their first test here, the scrums after the second, professional fouls after the third and Fitzpatrick's tackling after the fourth. I did say before the fourth test I wonder what it will be,' Hart said. It's obviously a smoke screen to probably confuse some of the other things that are going on.'' The incident did not cause the gash to Teichmann's forehead which required stitches. Du Plessis said the injury needed 10 stitches, but it was later revealed the wound required only five stitches. Most of Monday's daily newspapers highlighted du Plessis' complaint instead of the All Blacks' 33-26 win which clinched New Zealand's first ever series victory in South Africa. -- Wellington newsroom 64 4 473-4746 3216 !GCAT !GSPO Sumo wrestler Kyokushuzan will become the first Mongolian to compete in the top division of Japan's traditional sport in the autumn tournament, according to new rankings from the Japan Sumo Association on Monday. "It was my dream to fight with (Hawaii-born star) Konishiki," Kyokushuzan told the press at Oshima sumo stable in Tokyo where he belongs with two other Mongolian wrestlers. Kyokushuzan, born as Daba Badobayaru in Mongolia, was promoted to makuuchi, sumo's top division, after marking nine wins and six losses at the previous tournament in July. Kyokushuzan, whose Japanese ring name means "Rising Eagle Mountain" and contains symbols from traditional Mongolian wrestling, will be the fourth foreign-born wrestler to fight in sumo's top division. The other three are Hawaii-born wrestlers Akebono, Konishiki and Musashimaru, all of whom later took up Japanese citizenship. The Japan Sumo Association placed the 23-year-old Kyokushuzan as a 15th ranked maegashira, the traditional starting rank for newly promoted wrestlers. The Autumn Grand Sumo Tournament will start from September 8 at Ryogoku Kokugikan arena in Tokyo. 3217 !GCAT !GSPO It took Russian chess veteran Anatoly Karpov just 32 moves and four hours, 25 minutes on Monday to force the resignation of the outside world in the first live chess contest of its kind on the Internet. Karpov, international chess federation FIDE world champion, sat at a real chess board in a Helsinki hotel and his moves were transferred to a virtual board on surfers' screens. Contestants then had seven minutes to vote for the response they preferred and a computer calculated the most popular one. A Finn then carried out the world's chosen move on Karpov's board. Around 250 people from countries as far-flung as Brazil and South Korea played from start to finish and the game's organisers said the World Wide Web site had booked about 500,000 "hits' or around 250,000 actual visitors. "There was a forced variation so I knew what would happen in the last six moves," said Karpov, who played black, after the match. "This is SOOOO cool. Hey, let's beat Karpov! ! !" enthused one player on the site's electronic visitors' book before the match. By the game's final hour, the key question in the hotel was when the world would finally resign. In the end nearly half the 241 remaining players threw in the towel, with the next most popular move attracting only about 10 percent of votes. Karpov, who between moves chatted amiably with onlookers about games past and present, wanted to keep playing until more than half of his opponents had given up. "If it's less than 50 percent you should play the move," he told the judges. "That means most still want to play." Chess experts, who said Karpov played a Carocan opening, pointed out that the world was doomed from the start by being forced into the majority line. "There were no infantile mistakes but there was not the courage to make one critical move. That's why the defeat is obvious but slow," said Roni Klimscheffskij, the Finn who played for the world. The world's biggest mistake was to wait too long before moving bishop to E2, he said. But there was consolation from Karpov for the losers. "If you play a real game you suffer, but here nobody knows," he said. "They can just say they weren't playing me." 3218 !GCAT !GPOL UKRAINE GOVERNMENT LIST (960826) President (Sworn in 19 Jul 94)..................Leonid KUCHMA - - - - - - - CABINET: Prime Minister (Re-Apptd 10 Jul 96)........... Pavlo LAZARENKO - - - - - - - COUNCIL OF MINISTERS First Deputy Prime Minister...................Vasyl DURDYNETS Deputy Prime Minister..................................Vacant (i/c of Economy) Deputy Prime Minister.............................Roman SHPEK (i/c of Technical Assistance and Reconstruction) Deputy Prime Minister.........................Viktor PYNZENYK (i/c of Economic Reform) Deputy Prime Minister..................................Vacant (i/c of State Security and Emergency Situations) Deputy Prime Minister.........................Mykhailo ZUBETS (i/c of Agriculture) Deputy Prime Minister..............................Ivan KURAS (i/c of Humanitarian Issues) Deputy Prime Minister.......................Vasyl YEVTUKHOV** (i/c of Fuel & Energy) (** Dismissed 8 Jul 96) Deputy Prime Minister.......................... Anatoly KINAKH (i/c of Industrial Policy) Deputy Prime Minister.......................... . Ihor MITYUKOV (i/c of Ties with Financial Organisations & European Union) Deputy Prime Minister........................Olexander YEMETS (i/c of Legal Matters) - - - - - - - MINISTERS: Agriculture.................................Anatoly KHORISHKO Building & Architecture (Acting)..................Yuri SERBIN Cabinet Affairs .........................Valery PUSTOVOITENKO Chernobyl Aftermath........................Volodymyr KHOLOSHA Coal Industry.................................Sergei POLYAKOV Communications............................... . Dmytro KHUDOLIY Culture......................................Dmytro OSTAPENKO Defence...........................Lieut.-Gen Olexander KUZMUK Economics.......................................Vasyl HUREYEV Education..................................Mykhailo ZHUROVSKY Energy & Electrification..................... . Yuri BOCHKARYOV Environment & Nuclear Safety....................Yuri KOSTENKO Finance...................................Valentyn KORONEVSKY Fisheries.................................... Mykola SHVEDENKO Foreign Affairs..............................Hennady UDOVENKO Foreign Trade.................................... . Serhy OSYKA Forestry...................................Valery SAMOPLAVSKY Health.................................... . Yevhen KOROLENKO** (**Dismissed Jul 96) Industry......................................... Valery MAZUR Interior......................................Yuri KRAVCHENKO Justice........................................Serhi HOLOVATY Labour.................................... . Mykola BILOBLODSKY Machine Building & Military Complex........... . Valery MALEYEV Nationalities & Migration...................Volodymyr YEVTUKH Press & Information.......................Mykhailo ONUFRICHUK Social Affairs.................................Arkady YERSHOV State Property Fund Chairman..................Yuri YEKHANUROV Statistics...................................Mykola BORYSENKO Transport......................................Ivan DANKEVYCH Youth & Sport...................................Valery BORZOV - - - - - - - CHAIRMEN OF STATE COMMITTEES: Border control.................................Viktor BANNYKH Customs........................................Leonid DERKACH Material Resources.......................... . Anatoly KLESHNYA Medicine & Medical Industry....................Yuri SPIZHENKO Science, Technology & Industry........... . Volodymyr STORIZHKO Security service.......................... Volodymyr RADCHENKO State Nuclear Energy Committee (acting)...... . Nur NIGMATULLIN - - - - - - - Chairman of Parliament........................Olexander MOROZ - - - - - - - Central Bank Governor.......................Viktor YUSHCHENKO - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End Government List) 3219 !C21 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Most of Canada's Prairie crops should be swathed and safe from the risk of frost if warm overnight temperatures can hold until September 15, a Canadian Wheat Board weather analyst said. "If we can get as far as September 15, then frost will be a minor issue," CWB weather and crop surveillance director Paul Bullock told Reuters in a telephone interview. Most spring crops were sown one to two weeks late due to wet and cool weather conditions. Harvest is usually general on the Prairies by the end of August. -- Gilbert Le Gras 204 947 3548 3220 !GCAT !GWEA !M14 !M141 !MCAT Canada's Prairies on Monday were forecast to see mainly sunny skies with warm and dry weather through to Friday, Environment Canada said. "It looks fairly dry right across the Prairies to Friday," meteorologist Francois Choquet told Reuters. Southern Alberta was forecast to see clear skies with lows of 9.0 Celsius (48.2 Fahrenheit) or more and highs of 26 to 30 C (78.8 to 86.0 F) through to Friday. Northern Alberta was forecast to see 30 percent chance of rain Wednesday and a 40 percent chance of rain Friday. Lows should be 12 Celsius (53.6 F) or higher. Highs were forecast to range from 25 to 30 C (77.0 to 86.0 F), Choquet said. Saskatchewan was forecast to see clear skies with lows of 12 C (53.6 F) or more and highs of 30 Celsius (86.0 F). Manitoba was forecast to see clear skies with lows of 11 C (51.8 F) and highs of 30 C (86.0 F). -- Gilbert Le Gras 204 947 3548 3221 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GVIO Thousands of Zimbabwean civil servants ignored armed riot police, patrolling a tense Harare on Monday, to challenge their sacking by the government over a crippling strike. Some 5,000 to 7,000 strikers gathered in a central city park to hear their angry union leaders imploring President Robert Mugabe's goverment "to be man enough" to address their demands for wage increases of between 30 and 60 percent. "Intimidation is not the right approach. The manly thing to do is to face the problem right in the face, acknowledge our stance that we are not going to accept insults, and pay us," Givemore Masongorera, the president of the Public Service Association (PSA) union, said to wild cheers. Police -- some armed with pistols, semi-automatic rifles and teargas canisters -- who were deployed by the government kept a wary eye on the proceedings. Dozens more were on guard at the capital's University of Zimbabwe, normally a hotbed of opposition demonstrations. The strikers -- including state doctors, nurses, mortuary attendants and firefighters -- spent four days last week in Africa Unity Square park, singing, dancing and denouncing the government for refusing their pay demands. They say a rise of up to nine percent they were recently awarded was "an unacceptable insult" and that their salaries have failed to keep up with annual inflation which has averaged 22 percent over the last two years. The government said at the weekend it had fired all the striking workers, estimated by some PSA officials at between 70 and 80 percent of 180,000 civil servants. "We are all still government employees. We were not hired on TV and we will not be fired on TV," Masongerera said. Many political analysts see the strike as a rare challenge to Mugabe and his ZANU-PF party, both in power since 1980. On Sunday night, Mugabe told reporters when he returned from a honeymoon with his former presidential secretary Grace Marufu, that he knew nothing about the civil servants' grievances. "I got real angry yesterday when I heard him (Mugabe) saying he wasn't aware of our grievances because everyone else is aware," one visibly irate worker told Reuters. Mugabe married two weeks ago and the couple spent their honeymoon in Cape Town. Some senior civil servants told reporters there was confusion in government offices across the southern African state, on who had been fired and whether they should recruit. Only skeleton services were available all round, with state hospitals continuing to rely on help from personnel from the national army and from Red Cross medical departments. Zimbabwe state media reported the situation was getting desperate. Zimbabwe's financial markets shrugged off the chaos, but brokers on the local stock exchange said there was worry that if the industrial action was not resolved harmoniously it would hurt the national investment image. The strike has created unusual divisions in Mugabe's government, with some MPs and senior officials calling on the government to meet the strikers' demands and some cabinet ministers saying it was dangerous to back down to "mob rule". Mugabe himself has said he might use the strike -- which has been backed by many civic groups -- to slash the bloated service. 3222 !GCAT !GDIP !GPOL !GVIO An estimated 4,000 Rwandan Hutu refugees returned to Rwanda from Burundi on Monday, leaving only 6,000 in Rwanda's southern neighbour from more than 100,000 at the start of the year. Sixty-two trucks loaded with 4,000 people exiled from their homeland for two years left Rukuramigabo camp for Rwanda, most heading for the southern town of Butare, U.N. officials said. "That leaves 6,000 in the last camp in Burundi. We are looking to empty it of the last who want to go on Tuesday," said Paul Stromberg, spokesman for the U.N. High Commissioner for Refugees (UNHCR). "Because of the strong demand for places shown today we will try and bring in 100 to 120 trucks on Tuesday," said Stromberg, adding UNHCR would try to determine on Tuesday whether there were some refugees in the last camp who did want to go home. The international community spent millions of dollars in aid on Rwandan refugees in Burundi amid constant fears of their being dragged into conflict between Burundian Hutu rebels and the army. The U.N. World Food Programme said on Monday four trucks carrying high protein biscuits, medicine and rice for displaced and refugees in Burundi arrived on Sunday after regional states exempted them from nearly month-old sanctions on the country. "It would be a big relief to see the end of the Rwandan refugee problem in Burundi. The difficulty is however that the problem endures in Tanzania and Zaire," said an aid official. An operation to empty Magara, the largest Rwandan camp in Burundi, ended last Thursday when the last of 50,000 refugees reached Rwanda, leaving 223 who refused to go home voluntarily. The Hutu refugees leaving Burundi are part of more than two million who fled Rwanda in 1994 during civil war and in fear of reprisal attacks for the genocidal killing of up to one million Tutsis and Hutu moderates by Hutu troops, militiamen and mobs. Refugees began returning in large numbers after Burundi's Tutsi-dominated army seized power on July 25. They have accused troops of harassing them and three were killed by soldiers on August 18. Zairean Prime Minister Kengo wa Dondo said on Thursday Zaire and Rwanda had agreed an "organised, massive and unconditional" repatriation of 1.1 million Rwandan refugees in eastern Zaire. He said the repatriation would be "enormous and immediate" and Zaire would close all Rwandan refugee camps on its soil. UNHCR was not consulted in advance about the Zairean-Rwandan agreement, which prompted a Rwandan Hutu refugee lobby group to warn expulsions of refugees from Zaire could start within days. Romano Urasa, UNHCR head in Rwanda, told Reuters on Monday his agency always aimed at an orderly refugee return from Zaire and UNHCR was taking the Rwandan-Zairean statement seriously. Urasa said UNHCR's transit centres on the Zairean border would have a maximum capacity of 43,000 to 45,000 returnees per night as long as the repatriation from Zaire was orderly. He said Zairean authorities were separating Rwandan Hutu intimidators, hardliners strongly opposed to any voluntary return to Rwanda, from refugees in camps in eastern Zaire. A Rwandan army spokesman said 28 Rwandan Hutus from camps near Goma, Zaire, and 18 others from camps around Bukavu expelled by Zaire last week would arrive in Rwanda's capital on Monday. They were expelled as camp troublemakers by Zaire and arrested on arrival in Rwanda. Many were former members of the former Hutu army, which was closely involved in the genocide. 3223 !GCAT !GCRIM !GPOL A white South African policeman who boasted that he was apartheid's most ruthless killer was found guilty of five murders on Monday to become the most senior servant of white rule yet to face justice. Eugene de Kock, 48, a former police colonel who commanded a ruthless hit-squad unit that killed opponents of apartheid, was found guilty of killing five black men including Tiso Leballo, a driver of Winnie Mandela, in 1992. His trial began shortly after President Nelson Mandela's election in April 1994 and revealed the depth of the ousted government's "Third Force" dirty tricks operation. Pretoria Supreme Court Judge Willem van der Merwe, who was aided throughout the two-year trial by two lay assessors, began his judgment by outlining the state's evidence against de Kock before ruling: "There is no doubt...A guilty finding must follow." Van der Merwe said he would pronounce his verdict on three further murder charges and on numerous other counts of fraud, theft and attempted murder on Tuesday. South Africa abolished the death penalty in June 1995, and the former colonel faces life imprisonment -- commonly 25 years -- on each murder charge. No date has been set for sentencing. De Kock had earlier in the case admitted to involvement in the murders of four men in a vehicle ambush in March 26, 1992, and to ordering the murder of Leballo a few days later. He had pleaded not guilty but even his own lawyers -- before the trial was over -- said the evidence against him was strong. "De Kock's plea is not guilty but we conceded on the state's evidence that he might be guilty of at least five of the eight murder charges," defence attorney Schalk Hugo told Reuters. A neatly-suited de Kock was relaxed throughout the first day of the judgment, calmly taking copious notes of the judge's findings and laughing with his lawyers during the court breaks. The trial has been one of the country's longest, with 92 witnesses called, 12,000 pages of evidence and 3,000 exhibits. It has provided a litany of the death and mayhem which formed part of the "old" South Africa. The accusations included massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police. Asked by lawyers at another trial, where he gave evidence, if he agreed he was the security forces' "most effective assassin", de Kock answered: "Yes, I would say that would be correct." That testimony helped convict three former colleagues in June of a bloody 1989 car-bombing and won him indemnity from prosecution for that trial. He has now applied to Archbishop Desmond Tutu's Truth and Reconciliation Commission for his own trial, requesting the amnesty it has the power to grant to those who committed human rights abuses but came clean. A policeman for 27 years, de Kock left South Africa in the 1960s to fight black liberation guerrillas in former white-led Rhodesia, now Zimbabwe. Back home, he formed a security police unit that tried to thwart the South West African People's Organisation (SWAPO) in its fight for Namibian independence from South Africa. In 1980 he joined the now notorius Vlakplaas unit, based on a farm near Pretoria, where senior officers plotted the killing and discrediting of the enemies of white rule and sowing dissent among them. On his arrest in early 1994 he possessed eight passports and millions of rands stashed in offshore banks. Before de Kock became commander, the unit was led by Dirk Coetzee, who later exposed the government's "Third Force" death squads and joined Mandela's African National Congress. Coetzee, who faces a murder trial in December despite his amnesty application, has survived at least two attempts on his life -- one of which de Kock is accused of planning. 3224 !GCAT !GCRIM !GPOL A white South African policeman who said he was apartheid's most ruthless killer was found guilty on Monday of five murders. Eugene de Kock, the highest ranking apartheid-era official to be convicted for a dirty tricks campaign against the old regime's black opponents, was found guilty of killing five black men including Winnie Mandela's driver in 1992. Pretoria Supreme Court Judge Willem van der Merwe said he would pronounce his verdict on three further murder charges and more counts of fraud, theft and attempted murder on Tuesday. De Kock, 48, commanded a ruthless hit-squad unit that killed opponents of apartheid and plotted to sow divisions between the groups fighting for black majority rule. His trial began shortly after President Nelson Mandela's election in April 1994 and revealed the depth of the ousted government's "Third Force" dirty tricks operation. His unit was accused of massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police. Testifying in a trial of some of the unit's lower operatives this year, de Kock was asked by lawyers if he agreed he was the security force's "most effective assassin" "Yes, I would say that would be correct," he replied. He has applied to Archbishop Desmond Tutu's Truth and Reconciliation Commission for the amnesty it has the power to grant to those who committed human rights abuses but who admit them, give details and seek reconciliation. 3225 !GCAT !GREL !GVIO Rebels are holding six Roman Catholic missionaries including three Australian nuns in south Sudan accused of spying and spreading Islam, the church said on Monday. The Catholic Information Office in Nairobi said Sudan People's Liberation Army (SPLA) rebels were holding four in prison and two others in a mission compound at Mapourdit in the south. It said Australian Sisters Moira Lynch, 73, and Mary Batchelor, 68, American Father Michael Barton, 48, and Sudanese Father Raphael Riel, 48, were being held in prison by the SPLA. Australian Sister Maureen Carey, 52, and Italian Brother Raniero Iacomella, 28, were held in the mission compound. "Charges against the (first) four missionaries were stated as 'hindering SPLA recruitment, being found in possession of documents proving that they were spies from foreign countries, working for the spread of Islam under the guise of the Cross," the information office said in a statement. It said Carey and Iacomella were held in the mission for what the rebel group said was their own security, it added. SPLA officials were not immediately available for comment. But the Sudanese Catholic Information Office said the SPLA's Nairobi office atrributed the detentions to a local commander and said that the missionaries would be freed by August 23. "At a meeting with the local (SPLA) commander, it was learnt that...no instructions to release the prisoners had been received and that they would be held until investigations were completed," the statement said. The missionaries were detained on August 17, the church said. It said last Friday they were visited by Monsignor Caesar Mazzolari, apostolic administrator of the diocese of Rumbek in southern Sudan and an SPLA administrator and appeared in good condition. "On August 17 the mission was surrounded (by the SPLA) and sealed off. The evening of the same day the missionaries were put in prison or isolation. Later the mission was looted," it added. "Monsignor Mazzolari appeals to the SPLA leadership to guarantee the well-being of the missionaries while investigations take their course...certain that the missionaries will prove to be totally innocent," it said. The SPLA has been fighting Khartoum's government forces in the south since 1983 for greater autonomy or independence of the mainly Christian and animist region from the Moslem, Arabised north. The SPLA has been weakened by splits since 1991 and two splinter factions in April signed a peace pact with Khartoum. 3226 !GCAT !GDIP President Nelson Mandela told Taiwan's visiting Vice Premier Hsu Li-teh on Monday that South Africa would stand by his country but wanted to improve relations with both it and China. But he showed no support for Taipei's renewed bid to be readmitted to the United Nations, which has recognised Beijing as the sole China for a quarter of a century. Mandela inherited diplomatic relations with Taipei from the old apartheid regime. Beijing refuses to recognise any country that has ties with the island it regards as a renegade province. "It would be a man who has no morality," Mandela said, who would take financial support from Taiwan as he had and then turn round once in power and say "we want nothing to do with you, we are going to cancel diplomatic relations with you". "I will not be guilty of that," he told reporters in Pretoria after hosting Hsu for lunch, a show of diplomatic support that many world leaders, anxious to keep in Beijing's good books, could not countenance. "He assured us that the relationship between South Africa and the Republic of China (Taiwan) is firm. He will support us whatever we are doing," Hsu, who arrived on Monday on a nine-day trip with a business delegation, told reporters. Mandela, 78, said he hoped his loyalty to Taiwan which helped fund his African National Congress so it could fight the 1994 elections, would not alienate its huge Communist rival. "We would like to improve our relations with both countries," he said. "We would like to establish diplomatic relations with the People's Republic of China (PRC)." Beijing has made clear that is impossible while Taipei enjoys diplomatic recognition. It has maintained hostility to Taipei since a 1949 civil war that split China into the Communist mainland and Nationalist Taiwan. "Nobody can ignore a country like the PRC which has a population of over one billion," Mandela said. "It was one of the greatest developments in international relations when the PRC was admitted to the United Nations and we welcome that," he added. Taiwan last week launched its latest drive for a U.N. seat, annoying China which is sure to veto it. "Our purpose is to seek the basic rights of 21.3 million people in the Taiwan region and an appropriate representation in the United Nations," the Taipei foreign ministry said. Beijing took China's U.N. seat from Taipei in 1971 and has intensified its drive to isolate Taiwan's government. South Africa is the biggest of Taiwan's diplomatic allies whose numbers dwindled to 30 this month when the West African state of Niger swapped sides. The United States recognises Beijing but has remained warm towards Taipei. China demanded on Monday that the United States cancel fresh plans to sell Stinger missiles, launchers and other weapons to Taiwan to prevent "new damage" to Sino-U.S. relations. 3227 !GCAT !GPOL !GVIO Angola's former rebel movement UNITA ended a party congress on Monday without saying if it would fill one of two vice-presidency posts in a planned government of national unity, UNITA leader Jonas Savimbi failed to reveal any decisions made by the congress when he made a 90-minute speech to a packed hall in the movement's northern stronghold of Bailundo, following four days of talks behind closed doors. One of the main issues the congress had to decide was if Savimbi would fill one of two vice-presidency posts in a proposed national unity government with the MPLA-led government. UNITA fought a civil war against the MPLA for nearly two decades following Angola's independence from Portugal in 1975. Savimbi, 62, failed to mention if he, or anyone else in the organisation, would take up the vice-presidency. He has said he could combine that post with the leadership of UNITA. Last Wednesday, the congress loudly rejected the vice-presidency, shouting "negative, negative" when the topic was raised. There was no official vote and Savimbi later warned delegates against making "extreme decisions". Some party officials have suggested UNITA's chief constitutional negotiator Abel Chivukuvuku could become vice-president. Congress delegates said Savimbi would hold a news conference on Tuesday. A government delegation will travel to Bailundo on Thursday to meet Savimbi. They will discuss a date for a meeting between Savimbi and Angolan President Jose Eduardo dos Santos. The government has proposed that they would meet on September 15. Savimbi will discuss the outcome of the congress with the U.N. special envoy to Angola, Alioune Blondin Beye. The government and UNITA signed a peace pact in November 1994 and agreed to integrate their armies into a single national military force and proposed to form a unity government. About 6,500 U.N. troops have been helping to implement the peace plan, especially the disarming of UNITA's fighters at assembly camps. Some 60,000 UNITA troops have been disarmed and are awaiting demobilisation or integration into a single army. Savimbi said the international community was putting pressure on UNITA to comply with dates set in the peace plan to end the war. "The peace process is very good. It is healthy...Soldiers and weapons have been handed in...Why this pressure of dates? ," Savimbi asked. "The international community is ensuring that the war does not return." 3228 !GCAT !GCRIM !GPOL Self-confessed apartheid-era killer Eugene de Kock, convicted of five murders on Monday, faces another day of reckoning on Tuesday when a South African court decides on 116 charges still pending against him. The most senior servant of white rule to be convicted by a court, de Kock, 48, a former police colonel, was found guilty on Monday of planning and carrying out the ambush and murder of five black men. Pretoria Supreme Court Judge Willem van der Merwe began his judgment by outlining the state evidence against de Kock before ruling: "There is no doubt...A guilty finding must follow." Van der Merwe said he would hand down his verdict on three more murder charges and on numerous other lesser counts of fraud, theft and attempted murder on Tuesday. De Kock, dubbed "Prime Evil" by his colleagues, commanded a ruthless hit-squad unit based at Vlakplaas near Pretoria, which targeted opponents of apartheid. The 12,000 pages of evidence and 3,000 exhibits compiled over nearly two years for his trial have provided a litany of the death and mayhem in the "old" South Africa. The accusations included massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police officers. One of de Kock's former Vlakplaas colleagues, Christiaan Geldenhuys, testified that four of the five men involved in Monday's verdict were killed when about 200 rounds of ammunition were emptied into their minibus before it was set on fire. When de Kock learned that the fifth man, Winnie Mandela's driver Tiso Leballo, had escaped, he ordered his colleagues to "Buddha him" -- Vlakplaas slang for blowing up corpses. According to the charge sheet, Leballo was taken to a mine dump, where his body was blown up several times with dynamite. Chappies Klopper, another of the 92 witnesses -- 30 of whom were de Kock's colleagues -- testified last year the Buddha method meant blowing up the body "until there was nothing left to blow up". De Kock started his career as a killing machine 27 years ago as an ordinary policeman. He left South Africa in the 1960s to fight black guerrillas in former white-led Rhodesia, now Zimbabwe. Back home, he formed a security police unit that tried to thwart the South West African People's Organisation (SWAPO) in its fight for Namibian independence from South Africa. In 1980 he joined the now notorius Vlakplaas unit. By the time he was arrested early in 1994 he had eight passports and had deposited millions of rand (dollars) in offshore banks. Former president F.W. de Klerk's government contributed to de Kock's wealth when they bade him farewell in April 1993 with a golden handshake of 1.2 million rand (now about $265,000). The government also agreed to a watertight contract with de Kock for the taxpayer to pay all his legal costs, which so far total over four million rand ($885,000). South Africa abolished the death penalty in June 1995, and de Kock now faces up to life imprisonment -- commonly 25 years -- on each murder charge. But in return for evidence against his former cohorts, de Kock has applied to the country's Truth and Reconciliation Commission, requesting the amnesty it has the power to grant to those who committed human rights abuses but admitted them. No date has been set for either his court sentencing or his amnesty hearing. 3229 !GCAT !GDIP !GPOL Zairean Prime Minister Kengo wa Dondo has gone to Europe on holiday but he will meet President Mobutu Sese Seko during the trip to discuss a government reshuffle, Kengo's aides said on Monday. Kengo, who left on Sunday, and Mobutu will discuss the possibility of members of the opposition entering the transitional government, the aides added. Mobutu has been in Switzerland since August 15. The Swiss Foreign Ministry said at the time that he would undergo unspecified medical tests during a "short-term stay". Kengo said after talks in Rwanda last week that the one million Rwandan Hutu refugees in camps in Zaire would be sent home in the near future. An agreement between the two countries envisaged a return of the refugees before presidential and legislative elections which must be held by next July, the end of Zaire's much-delayed and repeatedly extended democratic transition. The Rwandans played down suggestions of a hasty repatriation of the refugees. Mobutu halted previous efforts to expel the refugees by force. The Hutus fled Rwanda in 1994 in fear of reprisals after Hutu hardliners massacred up one million people, mostly minority Tutsis, and Tutsi-led rebels seized power. 3230 !C21 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GVIO One miner was killed and six hurt in clashes between rival union members at the Gold Fields of South Africa Ltd's Leeudoorn mine late on Sunday, halting production for the sixth consecutive day, a mine official said on Monday. Mine manager Willem Delport told reporters he had decided not to allow work to resume at Leeudoorn, which produced 1,544 kg of gold in the quarter to end June, until the workers had resolved their differences. "I did it in the interests of safety and security, and that is to protect life and property," Delport said. The decision has, however, created conflict between mine management, which has insisted that "no work means no pay", and the powerful National Union of Mineworkers' (NUM). "Management should actually pay because it is them who stopped workers from going to work," said the NUM's Madoda Vilakazi. He added that his union's members had unanimously voted last week to return to work. On Monday, a conciliator was locked in a meeting between the NUM and its rival United Workers' Union of South Africa (Uwusa), as well as mine management. The meeting will continue this week. In the past three weeks, 17 miners have been killed in the union violence at Gold Fields' Kloof Gold Mining Co, of which Leeudoorn is a division, and Driefontein Consolidated. Gold Fields has attributed the violence to clashes between members of the 350,000-strong NUM, which has a largely Xhosa membership on the mine and is linked to the African National Congress (ANC), and the smaller Uwusa, which is aligned to the Zulu-based Inkatha Freedom Party. Gold Fields chief executive Alan Wright told reporters last week at a presentation of the group's year results that talks with both unions had yielded agreement on the urgent need to end the labour unrest. "We've had a number of tragedies at our mines in the past couple of weeks... All of us feel that there should be no more violence. No more tragedies," said Wright. There was no immediate information on what had sparked Sunday night's clash. 3231 !GCAT !GHEA Zimbabwe has recorded an unprecedented one million malaria cases and over 2,000 deaths from the disease this year, a health ministry official said on Monday. Samuel Tsoka, the principal health education officer, told the local official news agency ZIANA, it was "the worst (national) epidemic of malaria in living memory". He said 321 deaths were recorded last year from a couple of thousand cases, adding this year's record figures were a result of very wet weather immediately after a severe drought in 1995. 3232 !GCAT !GCRIM South African police said on Monday they had seized 10 kg (22 pounds) of pure cocaine with an estimated value of 2.5 million rand ($553,000) at Johannesburg's International Airport. Police Sergeant Mark Reynolds said in a statement that the cocaine was confiscated after detectives received a tip-off from an informer that the drug would be on board a flight from Rio de Janeiro. It was found in two suitcases left unclaimed on the baggage conveyor belt, wrapped in insulation tape and sewn into the lining of the bags, Reynolds added. Police said in July they had seized nearly 55 kg (120 pounds) of cocaine at the airport in the previous 45 days. Drug dealers are increasingly using South Africa as a transit point for narcotics from Southeast Asia and South America. ($=4.52 rand) 3233 !GCAT !GCRIM !GPOL South Africa's ruling African National Congress said on Monday that senior government ministers would meet next weekend to discuss spiralling crime that has worried foreign investors. The party said in a statement the two-day meeting in Cape Town would be attended by the ministers of police, defence and justice and representatives of the prisons and intelligence services. Foreign investors have warned South Africa they will pull out of the country if nothing is done to halt violent crimes such as car hijackings and armed robbery in which business leaders and tourists are often targeted. Crime is cited as one of the leading causes of an exodus of skilled South Africans to other countries. Many Moslem communities throughout South Africa have formed anti-crime organisations and staged marches on the homes of suspected criminals. During one such march in Cape Town earlier this month, a gang leader was shot and burned to death. 3234 !GCAT !GVIO The new commander of West African peacekeepers in Liberia pledged on Monday to crack down on the activities of rival factions in the capital Monrovia and to press ahead with arms searches. Major-General Sam Victor Malu, who took over this month as head of the Nigerian-led force, said it was redeploying to take effective control of every sector of the capital where rival factions ran amok killing hundred of people in April and May. "We will bring peace to this place by whatever means," he told his first news conference since taking command. Malu said that April's flare-up in the capital, during which ethnic Krahn gunmen fought supporters of faction leaders Charles Taylor and Alhadji Kromah, were in part caused by lax security by peacekeepers. Kidnappings and isolated killings continue. "They considered these faction leaders as VIPs and didn't care to search certain vehicles driven by faction supporters," he said. "We will redeploy and search everywhere to ensure that the city does not remain divided by faction fighters. No exceptions. Everybody means anybody in Liberia." Malu said that the deployment would run until the weekend and that after that the peacekeepers would extend their search for weapons beyond the capital. West African peacekeepers of the ECOMOG force have the task of overseeing implementation of the latest peace accord signed in Nigeria on August 17, which sets a timetable for disarmament by the end of January and elections on May 30, 1997. West African heads of state have threatened sanctions against individual faction leaders to ensure compliance. A ceasefire was supposed to come into force on August 20. Malu said his force was not yet in a position to say that the ceasefire had taken hold. Rival faction leaders have spoken of breaches in the west and the southeast. "We have no troops in those areas and so we have no independent confirmation on whether the ceasefire has taken hold." But Taylor and Kromah, both vice-chairmen on the ruling State Council, have ordered their fighters to pull back from front line positions and dismantle roadblocks. "For us the war is over and anyone who wants to fight will have ECOMOG to fight," Taylor said in a broadcast on his Kiss FM radio station on Friday. Both Taylor and Kromah have promised to complete disarmament of their fighters by September 30. Roosevelt Johnson, their main adversary in the Monrovia fighting, pledged on Friday to fight no more wars and to work with his rivals to unite the country. Freed American slaves founded Liberia in 1847. The Krahn broke the stranglehold on power of the slaves' descendents when Master Sergeant Samuel Doe seized power in 1980. Taylor and his forces launched the civil war in December 1989. The war has killed well over 150,000 people. Politicians said that the planned inauguration of the new State Council chairwoman Ruth Perry, nominated under the Nigeria peace deal, had been postponed to a date to be fixed. No official reason was given but politicians said Taylor and Kromah were travelling and unable to attend on Tuesday. 3235 !GCAT !GDIS !GENV One person was killed and 20,000 evacuated after a river burst its banks in central Ethiopia, the Ethiopian News Agency reported on Monday. The Awash river flooded on Friday, submerging the Wonji Sugar Estate. The agency said plantation workers whose homes were flooded, some 100 km (60 miles) east of Addis Ababa, were moved to nearby Nazareth town. Some 2,000-hectare (4,942-acre) of cane fields -- about half of the plantation -- and the vast building housing Wonji Sugar Factory were submerged in the waters, the agency reported. It said the Ethiopian military had to use helicopters and inflatable rubber boats on Sunday to rescue Wonji residents. Water Resources Minister Shiferaw Jarso said floods followed the release of 300 cubic metres of water per second into the river from nearby Koka Dam, which had reached dangerous levels. Shiferaw warned residents of the area to move to emergency shelters prepared by the government because staying could be hazardous. Ethiopian authorities say shelters are stocked with food, blankets and medicine for up to 150,000 in the area. 3236 !GCAT !GCRIM !GPOL A white South African policeman who said he was apartheid's most ruthless killer was found guilty on Monday of five murders. Eugene de Kock, the highest ranking apartheid-era official to be convicted for a dirty tricks campaign against the old regime's black opponents, was found guilty of killing five black men including Winnie Mandela's driver in 1992. Pretoria Supreme Court Judge Willem van der Merwe said he would pronounce his verdict on three further murder charges and on counts of fraud, theft and attempted murder on Tuesday. De Kock, 48, commanded a ruthless hit-squad unit that killed opponents of apartheid and plotted to sow divisions between the groups fighting for black majority rule. His trial began shortly after President Nelson Mandela's election in April 1994 and revealed the depth of the ousted government's "Third Force" dirty tricks operation. 3237 !GCAT !GPOL !GVIO Much of Burundi's capital was without mains electricity on Monday after Hutu rebels cut power lines to Bujumbura, stepping up pressure on the city already suffering from nearly a month of regional sanctions. Augustin Baruvura, director of Burundi's main power station, said "troublemakers" brought down four power lines near Bubanza town in northwestern Burundi on Saturday, cutting mains power to the capital. The Bubanza lines carry power from Rwegura dam in Burundi's northern Kayanza province and usually supply 18 megawatts of Bujumbura's needs of 25 megawatts, Baruvura told reporters. "It was troublemakers who cut the power lines at Bubanza, but we are in the process of repairing them," the director said. Hutu rebels last cut the power supply to Bujumbura in June before a July 25 coup by the Tutsi-dominated army that prompted regional states to impose sanctions against Burundi. New Tutsi military ruler Pierre Buyoya on Sunday met Julius Nyerere, the internationally-backed mediator on Burundi, and asked for a regional summit including Burundi to be convened. But on his return to Bujumbura from the meeting in Musoma, western Tanzania, Buyoya said there was no immediate prospect that sanctions would be lifted and the summit was to improve dialogue. Sanctions have hit the landlocked country hard, forcing the rationing of petrol and diesel and dramatically increasing prices of imported food and goods. The fuel shortage has pushed up the cost of food grown in the interior. Major businesses in Bujumbura normally rely on diesel generators during power failures but reserves are so low because of sanctions that only hospitals, schools and the university were supplied. Homes, offices and industries had no power, said Baruvura, who did not say how long repairs to the lines would take. Mains power was cut on Saturday but it was only on Monday that officials gave an explanation for the enduring blackout. The power cut increased the isolation of Bujumbura, the main centre of the Tutsi minority. Most Tutsis will not venture out into the hills where rebels roam. The airport has been closed to all foreign commercial flights since August 13. Hutu traders for several days stopped coming down from hills around the capital to sell food in the main market. Hutu rebel groups had urged them to keep away to starve out Tutsis. "We have managed to get food restored to the capital. People are coming down from the hills again to the market," said army spokesman Lieutenant-Colonel Longin Minani on Monday. Regional states demand a return to constitutional government and unconditional talks between all parties including the army and rebels. Both sides reject unconditional negotiations. Ousted Hutu President Sylvestre Ntibantunganya, who says he is still legal head of state, has remained holed up in the U.S. ambassador's residence in Bujumbura for more than a month. Most senior officials of the banned Hutu-dominated Frodebu party have fled abroad or taken refuge in foreign embassies. Around 150,000 people -- mostly civilians -- have died in Burundi since 1993, when the country's first democratically elected Hutu president was killed in an attempted army coup. The London-based human rights group Amnesty International said last week 4,050 people had been killed by Burundi's army in the Giheta district of central Gitega region since the coup. Buyoya dismissed the report as exaggerated and said his coup was to bring peace to Burundi but it would not come overnight. 3238 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Workers at De Beers Consolidated Mines Ltd's South African diamond mines will decide on strike action this week over wages and working conditions, the National Union of Mineworkers (NUM) said on Monday. The NUM said it expected almost 5,000 union members at De Beers mines to cast their ballots on Friday. The union said wage negotiations began in June with De Beers offering 9.25 percent against the NUM's demand of an 11 percent increase. "It seems De Beers will not take their workers' demands seriously and so we must stand our ground and show De Beers that we mean business...," NUM assistant general secretary Gwede Mantashe said in a statement. The union said it expected the results to be available early next week. -- Johannesburg newsroom, +27-11 482 1003 3239 !GCAT !GVIO Gunmen loyal to Somali faction leader Hussein Aideed killed a businessman allied to a south Mogadishu rival, raising fears of widespread conflict, residents said. Witnesses said 15 fighters and a "technical" four-wheel -drive battlewagon on Sunday ambushed and killed Mohamed Amir Awale, a prominent businessman allied with Aideed's rival Hassan Ali Osman Atto. They said another man was killed in the south Mogadishu ambush, which increased fears of imminent conflict between Aideed's forces and those of his rivals in the divided capital. Hussein Aideed, a 33-year-old former U.S. marine, was elected president of Somalia by supporters on August 4 to succeed his father Mohamed Farah Aideed, 62, who died three days earlier. A unilateral ceasefire proposed by an alliance of enemies of Mohamed Farah Aideed, the scourge of U.S. and U.N. peacekeeping troops in Somalia in 1993, broke down within a few days outside the capital. The Horn of Africa country has had no central government since the fall of late president Mohamed Siad Barre in 1991. Some members of Hussein Aideed's sub-clan said they expected fighting following his election as he would have to take revenge on forces which killed his father by shooting him on a south Mogadishu frontline. Hussein Aideed and his government said Mohamed Farah Aideed died of a heart attack and was not wounded in any violence. 3240 !GCAT !GDIP Several thousand Rwandan Hutu refugees were expected to leave a camp in Burundi and return to Rwanda on Monday, a U.N. official said. Paul Stromberg, spokesman for the U.N. High Commissioner for Refugees (UNHCR), said up to 1,500 Rwandan refugees had boarded trucks at Rukuramigabo camp to return to Rwanda. "There are a similar number waiting to board trucks. By the end of the day we could have at least 3,000 or more back in Rwanda," said Stromberg, adding before any had left on Monday the last Rwandan refugee camp in Burundi had 10,000 refugees. Stromberg said a total of 43 trucks and buses were involved in emptying Rukuramigabo camp and more might be on the way. An operation to empty the largest Rwandan camp in Burundi ended last Thursday when the last of 50,000 refugees crossed into Rwanda, leaving 223 who refused to go home voluntarily. The Hutu refugees leaving Burundi are part of more than two million who fled Rwanda in 1994 during civil war and in fear of reprisal attacks for the killing of up to one million Tutsis and Hutu moderates by Hutu troops, militiamen and mobs. Refugees began returning in large numbers after Burundi's Tutsi-dominated army seized power on July 25. They have accused troops of harassing them and three were killed by soldiers a week ago. Zairean Prime Minister Kengo wa Dondo said on Thursday Zaire and Rwanda agreed on an "organised, massive and unconditional" repatriation of 1.1 million Rwandan refugees in eastern Zaire. He said the repatriation would be "enormous and immediate" and Zaire would close all Rwandan refugee camps on its soil. UNHCR was not consulted in advance about the Zairean-Rwandan agreement, which prompted a Rwandan Hutu refugee lobby group to warn expulsions of refugees from Zaire could start within days. Romano Urasa, UNHCR head in Rwanda, told Reuters on Monday his agency always aimed at an orderly refugee return from Zaire and UNHCR was taking the Rwandan-Zairean statement seriously. Urasa said UNHCR's transit centres on the Zairean border would have a maximum capacity of 43,000 to 45,000 returnees per night as long as the repatriation from Zaire was orderly. He said Zairean authorities were separating Rwandan Hutu intimidators, hardliners strongly opposed to any voluntary return to Rwanda, from refugees in camps in eastern Zaire. A Rwandan army spokesman said 28 Rwandan Hutus from camps near Goma, Zaire, and another 18 from camps around Bukavu expelled by Zaire last week would arrive in Rwanda's capital on Monday. They were expelled as camp troublemakers by Zaire and arrested on arrival in Rwanda. Many were former members of the former Hutu army, which was closely involved in the genocide. Urasa said circumstances surrounding the Rwandan refugees in eastern Zaire were different from the previous two years as the country was facing presidential and parliamentary elections. He said two weeks ago tribal chiefs in Zaire's North Kivu province blamed their government for the presence of members of an exiled Rwandan Hutu extremist militia in their villages. "The local population is less and less pleased with the presence of the refugees," said Urasa. He said UNHCR's operation caring for 1.1 million refugees in eastern Zaire was costing $1 million per day and was the largest and most difficult of any such undertaking in the world. Rwandan authorities screen returning refugees and arrest any suspected of involvement in genocide. There are nearly 80,000 prisoners and detainees held in prisons and lockups in Rwanda. 3241 !C42 !CCAT !E41 !ECAT !GCAT !GCRIM !GJOB !GVIO Armed riot police deployed in the tense Zimbabwean capital Harare on Monday to keep watch over thousands of civil servants sacked at the weekend for defying orders to end a strike. In a show of force, the police -- some armed with pistols, semi-automatic rifles and teargas canisters -- patrolled the town centre and a squad watched a city park where some 1,000 people milled, waiting to be addressed by their union leaders. Dozens more were on guard at the capital's University of Zimbabwe, normally a hotbed of opposition demonstrations. Thousands of strikers -- including state doctors, nurses, mortuary attendants and firefighters -- spent four days last week in Africa Unity Square park, singing, dancing and denouncing the government for refusing to pay them salary increases of between 30 and 60 percent. They say their salaries have failed to keep up with annual inflation which has averaged 22 percent over the last two years. President Robert Mugabe's government said at the weekend it had fired all the striking workers, estimated by some Public Service Association (PSA) union officials at between 70 and 80 percent of 180,000 civil servants. Many political analysts see the strike as a rare challenge to Mugabe and his ZANU-PF party, both in power since 1980. On Sunday night, Mugabe told reporters when he returned from a honeymoon with his former presidential secretary Grace Marufu, that he knew nothing about the civil servants' grievances. "I got real angry yesterday when I heard him (Mugabe) saying he wasn't aware of our grievances because everyone else is aware," one visibly irate worker told Reuters. Mugabe married two weeks ago and the couple spent for their honeymoon in Cape Town. Some senior civil servants told reporters there was confusion in government offices across the southern African state, on who had been fired and whether new workers should be recruited. Only skeleton services were available all round, with state hospitals continuing to rely on help from personnel from the national army and from Red Cross medical departments. Zimbabwe state radio called on ordinary listeners to give regular weather reports from different areas in the absence of weather experts. Zimbabwe's financial markets shrugged off the civil servants strike, but brokers on the local stock exchange said there was worry that if the industrial action was not resolved harmoniously it would hurt the national investment image. The strike has created unusual divisions in Mugabe's government, with some MPs and senior officials calling on the government to meet the strikers' demands and some cabinet ministers saying it was dangerous to back down to "mob rule". Mugabe himself has said his government might use the strike to slash the bloated service. Many civic groups and private sector trade unions have expressed support for the public servants. 3242 !GCAT !GCRIM South Africa's parliament will soon study new legislation against money laundering that places the onus on banks and other institutions to report suspicious transactions, the ruling African National Congress said on Monday. Johnny de Lange, ANC chairman of a parliamentary justice committee, told reporters the measures could be controversial. "For example, if a person making a very humble salary suddenly deposits a million rand in his account, there will be an obligation on the bank to let the police know something fishy is going on," he said. The measure is among those in three bills -- the Proceeds of Crime Bill, the International Cooperation in Criminal Matters Bill and the Extradition Amendment Bill -- aimed at bringing South Africa into line with international efforts to stamp out drug trafficking. De Lange said the legislation aimed to close loopholes which currently allowed people to conceal or disguise the source of funds obtained through crime. Drafters of the bills said those who reported suspected money laundering would be protected from liability for breach of confidentiality. Those consulted in drafting the laws included the Council of South African Banks, the Afrikaanse Handelsinstituut, the South African Chamber of Business and the Johannesburg Stock Exchange. 3243 !GCAT These are significant stories in the Nigerian press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. DAILY TIMES - Managing director of Trade Bank says the floating of stabilisation securities on the inter bank market will boost liquidity and may lead to a reduction in interest rates. - Lagos state government to raise charges for water supply by 100 percent. - Chinese company contracted to rehabilitate the conveyor system at Port Harcourt ports. - Manager of Nigerian Ports Plc says movement of headquarters from Lagos to landlocked Abuja will not disrupt port operations. BUSINESS TIMES - Foreign shareholder in local Coca-Cola bottler, Nigerian Bottling Company, plans to increase stake from 38.5 percent to 50 percent. THE GUARDIAN - Police in Lagos review worrying crime situation. THISDAY - Dispute between Nigeria and Cameroon over Bakassi peninsula may have stalled a 3.8 billion naira project to dredge the port at the eastern city of Calabar. ($1=80 naira) --Lagos newsroom +234 1 2630317 3244 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The National Union of Mineworkers (NUM) said on Monday it had declared a dispute with Anglo American Platinum Corp (Amplats) after wage talks at Lebowa Platinum Mines Ltd collapsed last week. The NUM said in a statement that the third round of wage negotiations came to a halt at the end of last week. The company was offering a seven percent wage increase against the NUM's demand for a 15 percent increase. The union said a conciliation board should be established this week. Union members were also demanding parity with white workers in terms of standby allowances, retirement fund, annual leave and medical aid benefits. "Workers are also demanding an end to the company's practice of importing people with skills onto the mine instead of training and developing the present workforce," the NUM said. Amplats was not immediately available for comment. --Johannesburg newsroom, +27-11 482 1003 3245 !GCAT These are significant items in the Ivorian press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. FRATERNITE MATIN - An editorial on page two of the government daily denounces treatment of black Africans in France, particularly during Friday's police raid on the Paris church where African illegal immigrants had sought sanctuary. - The government daily reviews progress in the year since President Henri Konan Bedie's main pre-election policy speech; cites progress in economic development, regional integration and the fight against crime. - A back-page advertisement from Ivory Coast's privatisation committee urges Ivorians to become shareholders and explains what is involved. LA VOIE - Parliament to debate a draft law this week which will give security forces wider powers to enter private homes in search of evidence of a crime. It seeks to extend the right of entry to all members of the police and gendarmerie and to any time of the day or night. - Full-page colour advertisement from the privatisation committee urges individuals to buy shares in port cargo handling company SIVOM, the Societe Ivoirienne d'Operations Maritimes, from today Monday. LE JOUR - Ivorian journalists' union UNJCI urges amnesty for three colleagues jailed for insulting President Bedie. ($1=508 CFA) -- Abidjan newsroom +225 21 90 90 3246 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL The Zimbabwean government deployed armed police in a tense Harare on Monday to keep an eye on thousands of civil servants sacked at the weekend for defying orders to end a strike. The police patrolled the town and a squad watched a city park where some 1,000 people milled. Strikers -- including state doctors, nurses, mortuary attendants and firefighters -- spent four days last week in Africa Unity Square park , singing, dancing and denouncing the government for refusing to pay them salary increases of between 30 and 60 percent. President Mugabe's government said at the weekend it had fired all the striking workers, estimated by some Public Service Association (PSA) union officials at between 70 and 80 percent of 180,000 civil servants. The atmosphere was tense on Monday after the unprecedented strike, which many political analysts saw as a rare challenge to Mugabe and his ruling ZANU-PF party, both in power since 1980. Some senior civil servants told reporters there was confusion in government offices across the southern African state, on who had been fired and whether new workers should be recruited. Key social services, especially hospitals, were hit by the strike. 3247 !GCAT !GDIP Taiwan's Vice-Premier Hsu Li-teh arrived in South Africa on Monday for a nine-day visit, his embassy said. Hsu, the highest-ranking Taiwanese official to make a working visit to South Africa since President Nelson Mandela took office in 1994, will have lunch with Mandela in Pretoria. He is accompanied by a business delegation and will visit Taiwanese firms that have invested in South Africa. Taiwan has diplomatic relations with only 30 countries. The rest of the world recognises Beijing, which regards Taiwan as a renegade province and refuses relations with any country that has official ties with Taiwan. 3248 !C24 !CCAT !GCAT !GDIS Kloof Gold Mining Co Ltd said on Monday a fire 2,800 metres underground had been extinguished and production losses from the affected area were expected to be minimal. The fire was detected in the 21 Longwall on August 13 and contained. The area affected was served by the No 3 Sub-Vertical shaft and contributed about 10 percent of Kloof's underground ore production, the company said in a statement. "Further losses of production from this area are expected to be minimal," it said. Kloof produced 9,877.7 kg of gold in the three months to end-June. --Johannesburg newsroom, +27-11 482 1003 3249 !GCAT These are the leading stories in the Kenyan press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. DAILY NATION - The issue of "land grabbing" takes centre stage again with various religious and secular leaders condemning it and asking for intervention from the government to end it. - Molo member of parliament in Kenya's Rift Valley Province, Njenga Mungai, urges outgoing Nakuru Catholic bishop Ndingi Mwana a'Nzeki to facilitate true reconciliation between Kalenjins and Kikuyus in the constituency to enable those displaced in the ethnic clashes to return to their farms. EAST AFRICAN STANDARD - Lonrho East Africa chaiman Mark Too has clarified the sale of East African Tanning Extract farms in Uasin Gishu district and declared that all deals were perfectly and openly conducted. - President Daniel arap Moi reveals that drug barons had infiltrated the country and turned it into an international transit point of the illicit cargo. KENYA TIMES - A visiting Anglican priest from Australia, Reverend Pauline McCann, says the clamour for constitutional change, spearheaded by the Roman Catholic church was aimed at getting foreign funding. - About 10,000 people are in danger of being displaced following a move by a saltworks company to flood a large area, covering fresh water wells at Kimboni area in Kilifi district of Kenya's Coastal Province. THE EAST AFRICAN - Kenyan government succumbs to pressure from visiting mission of the International Monetary Fund and World Bank and sacks Donald Kimutai from his new job as chairman of the Industrial and Commercial Development Corporation. 3250 !C24 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Gold Fields Namibia Ltd said on Monday that severe disruptions had occurred at the three operations of its subsidiary Tsumeb Corp Ltd due to strike action by the Mineworkers Union of Namibia. "Reports indicate that strikers took control of certain key areas of the operations including the copper smelter and the entire Kombat property. Pumping at the Tsumeb, Kombat and Otjihase operations has been interrupted and water is currently flowing into the deeper levels of these mines," the company said. Gold Fields said damage to the copper smelter and flooding of the mines were "cause for very serious concern", but it added it was not possible top quantity the consequences at this stage. The company has obtained an urgent interim court order declaring the strike, in support of a wage demand, to be unlawful and restraining striking employees from obstructing the company's normal operations. However, the Namibian authorities have had only limited succeess in enforcing the order. -- Johannesburg newsroom +27 11 482 1003 3251 !GCAT !GPOL !GVIO Alexander Lebed tried to fix a meeting with Boris Yeltsin on Monday to discuss peace plans for Chechnya but the president left on holiday and Kremlin aides could not say if Yeltsin would meet his special envoy. Earlier in the day, Lebed met Prime Minister Viktor Chernomyrdin after returning to Moscow from Chechnya on Sunday saying he needed top-level support for his plans and to iron out legal technicalities for a political settlement in the region. Lebed's office said the Kremlin security chief could meet Yeltsin as soon as Tuesday. But Yeltsin's spokesman Sergei Yastrzhembsky was then quoted as saying Lebed had not sought any meeting with the president. In what sounded close to a snub, he said the president might meet "one state official or another" over the next few days. Yeltsin will continue to receive papers and remain in charge of policy, Yastrzhembsky said. But the 65-year-old leader needed to rest after the strain of last month's election. He was at a state residence 90 km (55 miles) from Moscow but might move at a later date, the spokesman said. Lebed had hoped to make peace with rebel leaders at the weekend after arranging a ceasefire last week which ended heavy fighting that started when the rebels seized Grozny on August 6. Russian television said the deputy commander of troops in Chechnya Konstantin Pulikovsky and other commanders would be questioned by prosecutors over the rebels' assault. It is not the first time Pulikovsky has been singled out over the latest crisis. Last week Defence Minister Igor Rodionov said he had been reprimanded for his threat to carpet bomb Grozny, where the rebels had cornered the troops. Lebed stopped the threatened bombardment at the last minute and agreed the ceasefire as part of a wider military deal with rebel chief-of-staff Aslan Maskhadov. Without a political settlement, however, it risks collapsing like every previous truce over the 20 months of the war. Yeltsin's back-seat approach to the the Chechen crisis has prompted speculation he is too tired or ill too take charge. But aides deny he is sick and many Russian analysts say Yeltsin may simply be keeping his distance in public to avoid taking the blame if Lebed's peacemaking efforts backfire. Lebed implied last week that he had not seen Yeltsin since he was appointed to deal with the conflict on August 10 although the two spoke by telephone on Friday, dampening speculation that Lebed was out on a limb in seeking compromise with the Chechens. Reuters correspondent Brian Killen reported from Grozny that ceasefire deal was holding and Russian troops were still pulling out of southern Chechnya. The rebels said they expected their chief-of-staff Maskhadov to meet Russian troop commander Vyacheslav Tikhomirov on Wednesday for a new talks on implementing the agreement, Interfax news agency said. But the meeting was not confirmed by the Russian side which appeared still angry over an incident in which Chechens disarmed a group of Russian soldiers in Grozny. The Chechens insist they have returned the weapons, but the Russians have said that they had not got them all back. Interfax quoted Lebed's office as saying that he and Chernomyrdin expressed satisfaction with the ceasefire. But the truce looked fragile in places and there was no sign of the joint Russian-Chechen patrols supposed to police the city. Lebed also presented his proposals for a political agreement, which is being scrutinised by Russian legal experts. A political settlement will be the trickiest part of Lebed's peace mission. He must reconcile rebel demands for independence with Moscow's insistence that the region stay part of Russia. 3252 !GCAT !GPOL !GVIO Alexander Lebed tried to fix a meeting with Boris Yeltsin on Monday to discuss peace plans for Chechnya but the president left on holiday and Kremlin aides could not say if Yeltsin would meet his special envoy. Earlier in the day, Lebed met Prime Minister Viktor Chernomyrdin after returning to Moscow from Chechnya on Sunday saying he needed top-level support for his plans and to iron out legal technicalities for a political settlement in the region. Lebed's office said the Kremlin security chief could meet Yeltsin as soon as Tuesday. But Yeltsin's spokesman Sergei Yastrzhembsky was then quoted as saying Lebed had not sought any meeting with the president. In what sounded close to a snub, he said the president might meet "one state official or another" over the next few days. Yeltsin will continue to receive papers and remain in charge of policy, Yastrzhembsky said. But the 65-year-old leader needed to rest after the strain of last month's election. He was at a state residence 90 km from Moscow but might move at a later date, the spokesman said. Lebed had hoped to make peace with rebel leaders at the weekend after arranging a ceasefire last week which ended heavy fighting that started when the rebels seized Grozny on August 6. Without a political settlement, however, it risks collapsing like every previous truce over the 20 months of the war. Yeltsin's back-seat approach to the the Chechen crisis has prompted speculation he is too tired or ill too take charge. But aides deny he is sick and many Russian analysts say Yeltsin may simply be keeping his distance in public to avoid taking the blame if Lebed's peacemaking efforts backfire. Lebed implied last week that he had not seen Yeltsin since he was appointed to deal with the conflict on August 10 although the two spoke by telephone on Friday, dampening speculation that Lebed was out on a limb in seeking compromise with the Chechens. Reuters correspondent Brian Killen reported from Grozny that ceasefire deal was holding and Russian troops were still pulling out of southern Chechnya. But the truce looked frail in places as commanders on both sides bickered over an incident in which Chechens disarmed a group of Russian soldiers in Grozny. And there was no sign of the joint Russian-Chechen patrols supposed to police the city. Interfax quoted Lebed's office as saying that he and Chernomyrdin expressed satisfaction with the ceasefire. Lebed also presented his proposals for a political agreement, which is being scrutinised by Russian legal experts. A political settlement will be the trickiest part of Lebed's peace mission. He must reconcile rebel demands for independence with Moscow's insistence that the region stay part of Russia. In Grozny, a group of rebels dropped in at a Russian checkpoint in the centre, shared out a watermelon and played with a kitten while a soldier sang songs. But both sides looked ill at ease in their strange new circumstances, introduced as part of the ceasefire brokered on Thursday by Lebed and rebel chief-of-staff Aslan Maskhadov. A few of the hundreds of thousands of refugees who have fled Grozny during this month's battles trickled back to see their ruined city, where the truce has largely held. The rebels still control much of the capital and they are determined not to give in. Amid the calm, Interfax said one Russian soldier was shot dead by a sniper and Russian positions came under fire 16 times. Interfax said that at least 450 Russian soldiers had been killed in the August fighting and many were still missing. Talks due between Maskhadov and Russian military commander Vyacheslav Tikhomirov were still stalled after separatists seized guns from Russian troops at the weekend. The Russian command has said talks will only be resumed once the weapons are handed over. The rebels said that could be soon. The pullout of Russian troops from the capital has also been suspended until the weapons are returned, Tass said. The rebels have said a renegade group seized the arms. But Interfax, quoting the separatist command, said almost all the weapons had been collected and would be handed over on Monday. 3253 !GCAT !GPOL Some two dozen Moslem men, tired of four years of living in exile, crossed the former confrontation line on Monday and returned to their abandoned village in northeast Bosnian territory under Serb control. "We had to come back here because we lived everywhere, in school buildings. I'm sick and tired of being a refugee," Salih Dugonjic, 63, told Reuters after the men reached Mahala, a small village near the Tuzla-Zvornik main road. The village is now deserted and most of the houses are half-burnt and covered with weeds. The men soon set about clearing debris, mowing the overgrown grass and burning garbage. "Now we have to create decent living conditions and then bring our families back," said Mustafa Kavazovic, 57, while helicopters of the NATO-led Bosnia peacekeepers (IFOR) flew overhead. Most Mahala residents, expelled when the Serb militia overran northeast Bosnia in Spring of 1992, were housed in the government-controlled towns of Kalesija and Tuzla. Under the Bosnia peace accord reached last December, the former warring parties pledged to guarantee freedom of movement for civilians and to allow free return of all refugees. The accord envisages a Bosnia comprising a Croat-Moslem federation and the Serb republic. But nationalists on all three sides, and especially the Serbs, have flouted the accord with impunity, making what were meant to be porous administrative lines into solid borders between ethnically pure statelets. Mahala villagers tried to go back to their homes in April but were blocked by 150 Serbs. In the ensuing clash there were two explosions and one Moslem was reported to have been slightly injured. This time around no one came to meet them except two former Serb neighbours who came around to pick plums, a common fruit in northern Bosnia, used to make home-brewed plum brandy. "The Serbs came to pick plums for brandy. One of them carried a gun but we didn't disarm him. They left after a short friendly conversation," said Mirsad Kuduzovic, 31. "They told us they expected us to come back," he said. An officer from the nearby U.S. Army base Alicia said it was up to the local Serb police to provide security for the returnees. "This is a job for (Serb) police to provide security for those people," Lieutenant-Colonel Anthony Harriman told Reuters. "What will I do if there is an incident? I'll go to the police. That's what I always do if there's civil disturbance." No members of the U.N. police (IPTF), monitoring law and order throughout post-war Bosnia, showed up to control the return. But Charles Hanes, commander of an IPTF station in Serb-held Zvornik, said he expected things to go fine. "We're planning for the worst and hoping for the best. We don't expect any problems here. We have excellent relations with the Serb and federation police," Hanes told Reuters. The villagers said they were determined to stay, although the village was controlled by the Serbs. "Let the Serb police come, let them fly their flag. We recognize this territory is the Serb Republic but they should recognize this is a Moslem village," said Orhan Aljic, 44. 3254 !GCAT !GPOL Albania's conservative President Sali Berisha on Monday dismissed steps by his Socialist rivals to modernise their party, saying reformers had been hijacked by former communists and secret police agents. Berisha said a key Socialist congress this weekend had shown that the party was riven by faction-fighting and incapable of embracing social democracy. "The (former communist) Party of Labour with a new name could not be reformed. So-called reform was simply a clan struggle," said Berisha, whose Democratic Party won nearly all parliamentary seats in a disputed general election in May. "In yesterday's congress, reforming elements were replaced by former ministers of (last communist president) Ramiz Alia, collaborators and persecutors of the Sigurimi secret police," Berisha added. The Socialists, heirs to the former communist party headed by Stalinist Enver Hoxha that ruled for four decades, on Sunday scrapped Marxist doctrine and officially condemned the Hoxha dictatorship in the ground-breaking congress. More than 600 delegates backed proposals to help stimulate the private sector, support legitimate private business and back private ownership of land in the biggest lurch away from the left since the fall of communism in 1990. Jailed Socialist leader Fatos Nano was re-elected party chief but drew criticism from some delegates for proposing that some ex-communist officials should sit on a new ruling body. "We condemned Ramiz Alia but then voted to the most important decision-making body some people who cooperated with him," said one young Socialist, who declined to be named. The new body, the 101-seat General Directive Committee, has yet to elect a secretary-general, who will effectively serve as acting Socialist leader while Nano remains in jail. Socialist in-fighting will hand Berisha more political ammunition following the bitter general election and ahead of nationwide local polls on October 20. Opposition parties boycotted the general election after complaining of voter intimidation and fraud. Foreign observers said the election did not meet international standards. The United States and the European Union, which expressed concern over the conduct of the election, have urged Tirana to hold a fresh general election at the earliest opportunity. Foreign governments have signalled that they will be watching local elections closely to ensure Albania is sticking to its commitment to democracy. 3255 !GCAT !GPOL !GVIO Russian security chief Alexander Lebed met Prime Minister Viktor Chernomyrdin to discuss peace plans for breakaway Chechnya on Monday as Russian troops and rebel fighters mixed uneasily in the Chechen capital. Few details were given of the talks between Chernomyrdin and Lebed, who returned to Moscow from Chechnya on Sunday saying he needed to seek top-level support for the plans and solve the legal technicalities of a political settlement for the region. Lebed's office said he was also ready to meet President Boris Yeltsin and that a meeting might take place on Tuesday. The president's office said it could not not immediately comment. Lebed implied last week that he had not seen Yeltsin since he was appointed to deal with the conflict on August 10 although the two men spoke on the telephone on Friday evening. Interfax news agency quoted Lebed's office as saying that he and Chernomyrdin expressed satisfaction over the ceasefire in Chechnya during a 90-minute meeting. Lebed also presented proposals for a political agreement for the region, which will be discussed with the rebels when Lebed returns to Chechnya, the agency quoted Lebed's office as adding. It said this agreement was already being scrutinised by legal experts. A political settlement for the rebel region will be the trickiest part of Lebed's peace mission as he has to reconcile rebel demands for total independence with an insistence by officials in Moscow that the region stay part of Russia. In the Chechen capital Grozny, a group of rebels dropped in at a Russian checkpoint in the centre, shared out a watermelon and played with a kitten while a soldier sang songs. But both sides looked ill at ease in their strange new circumstances, introduced as part of the ceasefire brokered on Thursday by Lebed and rebel chief-of-staff Aslan Maskhadov. Some of the hundreds of thousands of refugees who have fled Grozny trickled back to see their ruined city, where the truce has largely held. Grozny was the scene of fierce fighting earlier this month when the rebels, seeking to overshadow Yeltsin's inauguration for a second term of office on August 9, seized much of the capital city three days before. They still control much of the town and have said they are determined not to give in. Amid the general calm, Interfax news agency said one Russian soldier was shot dead by a sniper and Russian positions came under fire 16 times. A plume of black smoke still hung over the city's oil plant, set ablaze in earlier fighting. "This was, perhaps, the quietest night in the last year and a half," Tass quoted an interior ministry spokesman as saying. Interfax said that at least 450 Russian soldiers had been killed in the August fighting and many were still missing. Talks due between Maskhadov and Russian military commander Vyacheslav Tikhomirov were still stalled after separatists seized guns from a Russian interior ministry troops on Sunday. The Russian command has said talks will only be resumed once the weapons are handed over. The pullout of Russian troops from the capital has also been suspended until the weapons are returned, Itar-Tass said. The rebels have said a renegade group seized the arms. But Interfax, quoting the separatist command, said almost all the weapons had been collected and would be handed over on Monday. A rebel spokesman said Moscow had accepted the separatists' demand for a referendum on Chechnya's future status, although possibly not for some years. The rebels say a free vote would back their goal of independence. Chernomyrdin said voters might one day decide Chechnya's future but stressed in an interview on Sunday that the region should stay an integral part of Russia. "The people must decide. As they decide, so it will be," he told Russian television. But he added: "Chechnya should be part of the Russian Federation. That's simple. But when, how and with what status? It is essential not to decide that now." 3256 !GCAT !GPOL Albania's conservative President Sali Berisha on Monday dismissed steps by his Socialist rivals to modernise their party, saying reformers had been hijacked by former communists and secret police agents. Berisha said a key Socialist congress this weekend had shown that the party was riven by faction-fighting and incapable of embracing social democracy. "The (former communist) Party of Labour with a new name could not be reformed. So-called reform was simply a clan struggle," said Berisha, whose Democratic Party won nearly all parliamentary seats in a disputed general election in May. "In yesterday's congress, reforming elements were replaced by former ministers of (last communist president) Ramiz Alia, collaborators and persecutors of the Sigurimi secret police," Berisha added. The Socialists, heirs to the former communist party headed by Stalinist Enver Hoxha that ruled for four decades, on Sunday scrapped Marxist doctrine and officially condemned the Hoxha dictatorship in a ground-breaking weekend congress. More than 600 delegates backed proposals to help stimulate the private sector, support legitimate private business and back private ownership of land in the biggest lurch away from the left since the fall of communism in 1990. Jailed Socialist leader Fatos Nano was re-elected party chief but drew criticism from some delegates for proposing that some ex-communist officials should sit on a new ruling body. Berisha's comments will do little to help produce a climate for more open dialogue and cooperation between Albania's political parties following a bitter general election. Opposition parties boycotted the election half way through the May 26 vote after complaining of voter intimidation and fraud. Foreign observers said the election did not meet international standards. Tension rose further when riot police beat and arrested opposition leaders during a rally two days after the poll. The United States and the European Union, which expressed concern over the conduct of the election, have urged Tirana to hold a fresh general election at the earliest opportunity. Foreign governments have signalled that they will be watching nationwide local elections on October 20 closely to ensure Albania is sticking to its commitment to democracy. The U.S. State Department also called on the ruling Democrats on Friday to give a bigger role to the opposition parties in preparing for the local elections. But the Socialists, who refuse to take up the few seats they won in parliament, have warned Berisha that they will boycott the October vote because they say an electoral commission organising the poll is biased towards the ruling Democrats. 3257 !GCAT !GDIP !GPOL !GVIO !GVOTE Bosnia's election organisers will decide on Tuesday whether or not to postpone municipal elections scheduled as part of nationwide balloting, an OSCE spokeswoman said on Monday. Officials from the Organisation for Security and Cooperation in Europe (OSCE) are considering the postponement following allegations of serious irregularities in the registration of Serb refugees. International observers say the alleged irregularities could affect the outcome of voting for municipal assemblies. "Tomorrow...the Provisional Election Commission will consider the possible postponement of municipal elections only...the other elections will be held on September 14," OSCE spokeswoman Agota Kuperman told reporters in Sarajevo. "I think that it would be very difficult to select which municipal elections would have to be cancelled. I think probably if the decision (to cancell) were to be taken it would probably be all municipal elections..." Kuperman added that options other than postponement were also on the table, but she refused to specify what they were. The Dayton peace agreement gave the OSCE a mandate to organise Bosnian elections. The Provisional Election Commission is OSCE's top rule-making body for the poll. More than 600,000 refugees have registered to vote in 55 countries around the world, representing about 20 per cent of Bosnia's total electorate. They are due to begin voting on Wednesday, August 28, just one day after the PEC is supposed to make its decision. Balloting inside Bosnia is scheduled for September 14, when citizens are slated to elect municipal and cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency. A Sarajevo daily newspaper, Dnevi Avaz, which is close to Bosnia's Moslem nationalist SDA party, on Monday said the OSCE would postpone the municipal-level elections until the Spring of 1997 because of the refugee registration problems. SDA has a representative on the Provisional Election Commission. "I don't know what the source of the Dnevi Avaz report is, but it is consistent with what I have heard from western diplomats and from inside the OSCE," said an OSCE staff member in Sarajevo who asked not to be named. "The word is that Frowick has decided to postpone municipal elections but that he will wait for one more session of the PEC on Tuesday to take everyone's temperature on the issue." Ambassador Robert Frowick, an American, heads the OSCE mission in Bosnia. OSCE and independent monitors allege that Serb authorities have systematically discouraged refugees from registering to cast a ballot in the places they lived before the war. Instead, the refugees were said to have been directed by their authorities to vote from strategic towns which had Moslem majorities before the 43-month Bosnian war, but which are now underpopulated as a result of "ethnic cleansing". Diplomats explain the purpose of this electoral engineering is to secure Serb control over pivotal towns inside the 49 per cent of Bosnia known as the Serb republic, consolidating through the ballot box what was initially taken in war. The top U.N. refugee official in the Balkans highlighted the voter registration problem on Monday. "Results of the registration for September elections herald a dismal future for multi-ethnicity in Bosia-Hercegovina," warned Soren Jessen-Petersen, Special Envoy for the U.N. High Commissioner for Refugees in Former Yugoslavia. "In the run-up to elections, nationalistic political leaders are playing the ethnic/sectarian card, drumming up support within their constituencies by playing on bitter memories or fear." 3258 !GCAT !GPOL !GVIO Russian security chief Alexander Lebed met Prime Minister Viktor Chernomyrdin on Monday to seek top-level backing for his peace plans in the breakaway Chechen republic. A spokesman said Lebed was also ready to meet President Boris Yeltsin, but the president's office said it had no information about Yeltsin's plans for Monday. Itar-Tass news agency said Lebed and Chernomyrdin discussed the results of Lebed's trip to Chechnya, proposals put forward by separatist leaders and the political settlement of the conflict in a 90-minute meeting. Finding a political settlement for the 20-month-old Chechen conflict is the trickiest part of Lebed's peace mission to the rebel region. The rebels seek an independent state but Moscow officials say the region must stay part of Russia. Fighting flared earlier this month after the separatists, determined to make a political point before Yeltsin was inaugurated for a second term in office on August 9, seized much of the Chechen capital Grozny on August 6. They still control much of the town and have said they are determined not to give in. Grozny appeared calm on Monday, although Interfax news agency said one Russian soldier was shot dead by a sniper and Russian positions came under fire 16 times. A plume of black smoke still hung over the city's oil plant, set ablaze in earlier fighting. "This was, perhaps, the quietest night in the last year and a half," Tass quoted an Interior Ministry spokesman as saying. Interfax said that at least 450 Russian soldiers had been killed in the August fighting and many were still missing. Calm descended on Grozny last week after Lebed and Chechen chief-of-staff Aslan Maskhadov agreed a ceasefire, setting up joint patrols in Grozny and withdrawing Russian troops from some areas. Lebed, who returned to Moscow on Sunday after suspending talks with Maschadov, said then he would try to nail down the legal technicalities of proposals for Chechnya's political future during his Moscow visit. Both sides say the ceasefire has been broadly respected, although Russian military commanders say separatists seized guns and ammunition from a column of Russian soldiers on Saturday. They say talks with Maskhadov and Russian commander Vyacheslav Tikhomirov will only be resumed after the weapons are returned. The rebels have said a renegade group seized the arms. But Interfax, quoting the separatist command, said almost all the weapons had been collected and they would be handed over on Monday, paving the way for talks to resume in Chechnya. A rebel spokesman said Moscow had accepted the separatists' demand for a referendum, although possibly not for some years. The rebels say a free vote would back their goal of independence. Chernomyrdin said voters might one day decide Chechnya's future but stressed in a television interview on Sunday that Chechnya should stay an integral part of Russia. "The people must decide. As they decide, so it will be," he told Russian television. But he added: "Chechnya should be part of the Russian Federation. That's simple. But when, how and with what status? It is essential not to decide that now." 3259 !GCAT Here are highlights from Polish newspapers this morning. RZECZPOSPOLITA - The Polish Peasant Party (PSL) has kept its demand of a constructive no-confidence vote for the government in the coming cabinet reshuffle connected with the envisaged central government administration reform. The PSL's coalition partner, the ex-communist Democratic Left Alliance (SLD), is convinced that the PSL wants to disrupt the workings of the governmnent, SLD representatives said. - Former Prime Minister Tadeusz Mazowiecki, from the opposition centrist Union for Freedom (UW) party, said the UW's non-aggression pact with the Solidarity trade union will not guarantee the anti-communist opposition's success in next year's parliamentary elections. - Preparations of NFI prospectuses remain at various stages despite the November deadline. Some NFI funds such as E.Kwiatkowski are preparing their prospectus themselves while others such as Progress have hired independant consulting firms. - The Gdansk Port's net profit in 1996's first half reached 2.1 million zlotys, showing 1.2-million-growth compared with the same period last year, the port's management said. - According to Central Statistics Office (GUS) data, 25 thousand flats were completed in the first seven months of 1996, a 19 percent decline compared with last year's results. But July statistics showed that 560,300 flats were under construction, the largest number in many years. NOWA EUROPA - Over 200 companies including Lockheed Martin, McDonnell Douglas, Rockwell Defense Electronic, Saab, Ericsson and Euromissile will participate in the Fourth International Defence Industry Fair on September 12-15 in Kielce, central Poland. - The joint venture between trader Universal and South Korean Hyundai Corp started to assemble Hyundai carts last week. - GSM digital phone licence holder Polkomtel SA has officially approved the logo and trade name PLUS GSM for the firm. Final preparations to start a PLUS GSM network are now underway and will be completed in the next few weeks, Polkomtel board President Wladyslaw Bartoszewicz said. - The Bydgoszcz-based Jutrzenka confectionary maker will apply to the Warsaw bourse's board to shift its stock from the parallel market to the main floor in 1997's second quarter, Jutrzenka representatives said. - Poland's Interior Minister Zbigniew Siemiatkowski and the German chancellor's intelligence coordinator Bernd Schmidbauer have agreed to tighten cooperation between their intelligence services in fighting international organised crime, PAP agency said. GAZETA WYBORCZA - The First Polish-Russian Economic Forum will take place in Warsaw on September 28-29 this year. According to the Polish Chamber of Commerce, the Forum will provide an opportunity for trade promotion between Poland and the Russian Federation. - Nissan's new Primera model will be on sale in Poland in mid-October. The model, to be constructed in Britain, will be sold within this year's EU-made cars duty free quota. - The Northwestern Polish Zielin gas firm will start gas exploitation in October. The annual output of the plant should reach 70-100 million cubic metres, geologists say. - Poland's pork exports in the first five months this year reached 35,000 tonnes and exceeded last year's results for the same period last year by 27 thousand tonnes, a report by Farming Assistance Programmes Foundation said. ZYCIE WARSZAWY - According to a survey by the OBOP polling institute, 62 percent of Poles are convinced that high quality goods can be obtained at a good price in Poland while 30 percent say otherwise. - Six percent of imported food products and 14 percent of Polish-made goods stored by wholesalers are past the expiry date, and many firms do not have proper refrigeration equipment, a recent report by the PIH sanitary monitoring institute said. -- Warsaw Newsroom +48 22 653 9700 3260 !GCAT !GPOL !GVIO Russian envoy Alexander Lebed, seeking top-level approval for his Chechnya peace plans, met Prime Minister Viktor Chernomyrdin on Monday and is ready to meet President Boris Yeltsin, a spokesman said. But Yeltsin's office said they had no information about the president's plans for Monday. Yeltsin met new ministers in the Kremlin on Thursday but has not been seen in public since. Interfax news agency said Lebed and Chernomyrdin had discussed plans for a political and peaceful settlement in Chechnya, including proposals put forward by the separatists. Lebed said on Sunday he would try to nail down the legal technicalities of Moscow's proposals for Chechnya's political future during his Moscow visit. Russian news agencies said Chechnya was calm, although Interfax said one soldier was shot dead by a sniper and Russian positions came under fire 16 times. "This was, perhaps, the quietest night in the last year and a half," Tass quoted an Interior Ministry spokesman as saying. Separatist fighters, determined to make a political point before Yeltsin was inaugurated for a second term in office on August 9, seized much of the Chechen capital Grozny on August 6 in a raid which humiliated the Russian military. They still control much of the town and have said they are determined not to give in. Interfax said on Monday that at least 450 Russian soldiers had been killed in the fighting and many were still missing. Calm descended on Grozny last week after Lebed and rebel chief-of-staff Aslan Maskhadov agreed a ceasefire, setting up joint patrols in Grozny and withdrawing Russian troops from some areas. Both sides say the truce has been broadly respected, although Russian military commanders say separatists seized guns and ammunition from a column of Russian soldiers on Saturday. They say talks with Maskhadov will only be resumed after the weapons are returned. The rebels have said that renegade groups seized the arms. But Interfax, quoting the separatist command, said almost all the weapons had been collected and they would be handed over on Monday, paving the way for talks to resume in Chechnya. A rebel spokesman said Moscow had accepted the separatists' demand for a referendum, though possibly not for some years. The rebels say a free vote would back their goal of independence. Chernomyrdin said voters may one day decide Chechnya's future but stressed in a television interview on Sunday that Chechnya should stay an integral part of Russia. "The people must decide. As they decide, so it will be," he told Russian television. But he added: "Chechnya should be part of the Russian Federation. That's simple. But when, how and with what status? It is essential not to decide that now." 3261 !GCAT DELO - Slovenian president Milan Kucan and his Hungarian counterpart Arpad Goncz on Sunday opened 3.2 kilometres of new road from Hungary's Nemesnep to Slovenia's border. - Slovenian Foreign Minister Davorin Kracun met an Indian foreign ministry deputy in Ljubljana and said the two countries would like to extend their business and political ties. - Slovenian investment companies have already started buying shares of newly privatised firms that have not yet been listed on the Ljubljana bourse. But the Securities Market Agency said citizens should not hurry into selling as share prices were usually significantly lower before than after listing. - This weekend the number of tourists in Portoroz was just one percent lower than in the same period of last year. - Eight people committed suicide in Slovenia over the weekend, highlighting the fact that each year suicide accounts for more deaths than traffic accidents. - Defence Ministry said its artillery equipment was outdated and would have to be modernised in the future. - Slovenian electricity companies said they could face losses in 1996 due to low electricity prices that are controlled by the government. DNEVNIK - Slovenian pupils show very small interest in agricultural and manufacturing professions. - Slovenian Council of Environment said the proposal of a law on urban planning should be changed in order to provide better state control and protection of agricultural areas. REPUBLIKA - Due to slow privatisation process, the government is expected to extend the validity of privatisation vouchers, which are scheduled to expire at the end of September. - Experts said reform of the Slovenian pension system was necessary in order to keep pensions at current levels in the future. 3262 !GCAT These are some of the main stories in Sofia newspapers today. Reuters has not verified these stories and does not vouch for their accuracy. 24 CHASA -- The European Union has asked Bulgaria to cut its metal exports to the EU countries due to current stagnation of European metal markets, trade minister Atanas Paparizov said. -- Extension of the second tranche under the credit agreement between Bulgaria and the International Monetary Fund (IMF) will depend on the progress in the financial restructuring of loss-makers, IMF sources said. PARI -- A tender for oil and gas drilling concessions in Bulgaria will be held at the end of this week and the beginning of next week, Geology Committee general secretary Kolyo Tonev said. -- Bulgaria's internal debt has risen by 69 percent for the first seven months of the year and totalled 582.5 billion levs at the end of July, the Finance Ministry said. -- Bulgaria's national carrier Balkan Airlines expects some one milion dollars for the transportation of UN peacekeeping forces after winning a UN tender, company officials said. TRUD -- Foreign minister Georgi Pirinski left on a six-day working visit to the United States where he is expected to seek support for Bulgaria's full membership in the World Trade Organization. STANDART -- Ivo Nedyalkov, the president of Bulgaria's get-rich-quick fund East-West International Holding, has been arrested in France, Interpol officials in Paris said. -- The Bulgarian-Russian Investment Bank (BRIB) is expected to raise its capital to five billion levs from 1.25 billion levs to meet new central bank minimum capital requirements, the bank's executive director said. -- Sofia Newsroom, (++359-2) 981 8569 3263 !GCAT NARODNA OBRODA - Prime Minister Vladimir Meciar said Slovak banks were very interested in buying privatisation bonds which could improve their capital portfolios. He said the banks were asking for an increase in the limit of bonds they could buy. - No anonymous trades with privatisation bonds on the country's over-the-counter bourse, the RMS, have been concluded so far. - Sony launches trial production of TV components at its new plant in Trnava, western Slovakia, on Monday. SME - Interior Ministry sources say there are ongoing problems with leakage of confidential material from the ministry, the Slovak inteligence service (SIS) and the Ministry of Justice. - Meciar said he was not informed of any minister's intention to resign. Last week the media reported that at least interior minister Ludivit Hudek was planning to submit his resignation this week. -- Bratislava Newsroom, 42-7-210-3687 3264 !GCAT HOSPODARSKE NOVINY - The Czech Republic is expected to sign the second protocol of the Gerneral Agreement on the Trade of Financial Services this week in Geneva, the seat of the World Trade Organization. - Agriculture Minister Josef Lux stated that a yearly increase in food prices of 10 to 15 percent is realistic considering the inflation rate. - A significant decrease of dynamic mutual trade between the Czech Republic and Austria will be one of the themes of today's meeting between Trade and Industry Minister Vladimir Dlouhy and the new Austrian Economic Affairs Minister, J. Farnleitnerem. - Legal services have increased by up to 250 percent due to a new proclomation on legal services which went into effect July 1. This replaces regulations dating to 1990. - Some 61.2 percent of Czech citizens, or 6.319 million people, are at a productive age between 15 and 59 (or 54 for women). The entire population of The Czech Republic is listed at 10.317 million people. - Milko, a.s., once a leading dairy in North Bohemia, has been forced to restrict its production to one-tenth of its capacity of 150 thousand litres. - Grafo Ceske Budejovice, a.s., a manufacturer of writing utensils, and Koh-i-noor Hardmuth, a.s., the leading domestic firm in the area of school and office supplies, will merge as of January 1, 1997. PRAVO - Half of the shares of Chemapol Group a.s., one of the fastest developing Czech companies, belongs to banks, according to the general manager of Chemapol Group, a.s.. Komercni Banka, CSOB, Agrobanka, Ceska Sporitelna, Investicni a Postovni Banka and Union Banka Ostrava all hold Chempaol shares. - Ceska Pojistovna intends to increase its basic capital by 1.137 billion crowns to 3.412 billion crowns through a new emission of shares. A shareholders' meeting scheduled for September 5 will decide on the emission. - The Czech Republic and Norway are expected to sign a contract before the end of the year for the delivery of natural gas. The deliveries should begin in 1999. At first, one billion cubic metres of gas will be delivered, and will increase to two billion cubic metres at a later date. - The debt Russia owes the Czech Republic, mentioned as a major reason for the unbalanced budget, has remained constant at $3.4 billion. MLADA FRONTA DNES - Chemapol Group, which purchased a majority stake in the country's largest weapons company, Omnipol, last week, plans to return the Czech Republic to the top ten weapon-producing countries through an extensive recovery plan. - Defense Minister Miloslav Vyborny stated that NATO will make the decision to accept the membership of the Czech Republic next spring. -- Prague Newsroom, 42-2-2423-0003 3265 !GCAT !GPOL !GVIO Russian envoy Alexander Lebed, back in Moscow after talks with Chechen rebel leaders, will meet top officials on Monday to seek approval for plans to bring peace to the breakaway region, a spokesman said. The spokesman said Lebed, President Boris Yeltsin's special envoy to the rebel region, would meet Prime Minister Viktor Chernomyrdin on Monday. Lebed was also ready to meet Yeltsin, but the president's office has not yet confirmed that this would take place. Russian news agencies said Chechnya was calm, although Interfax said one soldier was shot dead by a sniper and Russian positions came under fire 16 times. "This was, perhaps, the quietest night in the last year and a half," Tass quoted an Interior Ministry spokesman as saying. Lebed, who called off a meeting on Sunday with separatist chief-of-staff Aslan Maskhadov, said on Sunday he would try to nail down the legal technicalities of Moscow's proposals for Chechnya's political future during his Moscow visit. A rebel spokesman said Moscow had accepted the separatists' demand for a referendum, though possibly not for some years. The rebels say a free vote would back their goal of independence. But Russian Prime Minister Viktor Chernomyrdin, while saying voters should, eventually, decide the future, stressed in a television interview on Sunday that Moscow also believed Chechnya should forever remain an integral part of Russia. "The people must decide. As they decide, so it will be," he told Russian television. But he did not explicitly say a referendum was on offer and said people would have to wait until the region recovered from the war before the political question could be settled. "Chechnya should be part of the Russian Federation. That's simple. But when, how and with what status? It is essential not to decide that now," he said. A rebel spokesman said Lebed and Maskhadov had agreed a face-saving political formula for both sides. He gave no details and Lebed apparently thought better of sealing a deal on Sunday. Maskhadov was due to meet Russian army commander General Vyacheslav Tikhomirov at noon (0800 GMT) on Monday in the village of Novye Atagi, south of the regional capital Grozny. The meeting was postponed on Sunday after Tikhomirov accused the rebels of breaking the ceasefire deal by seizing arms from a unit of Russian troops in Grozny. "I'm not going to play cat and mouse," Interfax news agency. quoted him as saying. Itar-Tass news agency said on Monday that the seized weapons had still not been handed over. But a ceasefire arranged last week by Lebed and Maskhadov has broadly held. Russian troops began withdrawing from the rebel-dominated Caucasus foothills in the south on Sunday and joint Russian-Chechen patrols to police the truce in Grozny got under way, albeit amid scepticism among their members. 3266 !GCAT !GCRIM !GVIO Prosecutors are to question Konstantin Pulikovsky, deputy commander of troops in Chechnya, about the seizure of the regional capital Grozny by rebels on August 6, Russian television said on Monday. Officials from the Russian Prosecutor-General's Office and the Main Military Prosecutor's Office would question Pulikovsky and other senior commanders, the television said. Pulikovsky was acting commander when the rebels attacked the city, sparking some of the worst fighting in more than a year. More than 400 Russian troops were killed in the battles which followed the rebels' assault, but the military was unable to dislodge the rebels, who took over most of the city. Russian security chief Alexander Lebed, who is leading a peace mission in Chechnya, has said the military knew about the assault in advance and asked why its leaders did not try to prevent it. Lebed blamed Interior Minister Anatoly Kulikov for the troops' failure to prevent the attack, the second on the Chechen capital this year. But Kulikov argued that he needed many more troops on the ground to hold the city and Interfax news agency has quoted Kremlin sources as saying that President Boris Yeltsin told Kulikov to stay in his job. Pulikovsky had already been singled out for criticism over recent events in Chechnya before Monday's announcement. With his troops surrounded in pockets in Grozny by the rebels, the commander threatened last week to unleash an all-out bombardment on the city, giving civilians 48 hours to escape. Lebed stopped the threatened bombardment at the last minute and Defence Minister Igor Rodionov said Pulikovsky had been given a dressing down over his ultimatum. Rodionov said Pulikovsky's actions had not been agreed with the Russian leadership, but that he was provoked by someone, without saying who that someone was. Vyacheslav Tikhomirov, the commander of troops who was on holiday when the crisis blew up, appeared to back Pulikovsky's threat when he returned, but he has not been given a public reprimand. 3267 !GCAT !GCRIM !GVIO Prosecutors are to question Konstantin Pulikovsky, deputy commander of troops in Chechnya, about the seizure of the regional capital Grozny by rebels on August 6, Russian television said on Monday. Officials from the Russian Prosecutor-General's Office and the Main Military Prosecutor's Office would question Pulikovsky and other senior commanders, the television said. Pulikovsky was acting commander of the troops when the rebels attacked the city, sparking some of the worst fighting in more than a year. More than 400 Russian troops were killed in the battles which followed the rebels' assault, but the military was unable to dislodge the rebels, who took over most of the city. Russian security chief Alexander Lebed, who is leading a peace mission in Chechnya, has said the military knew about the assault in advance and asked why it did not try to prevent it. With his troops surrounded in pockets in Grozny by the rebels, Pulikovsky threatened last week to unleash an all-out bombardment on the city, giving civilians 48 hours to escape. Lebed stopped the threatened bombardment at the last minute and Defence Minister Igor Rodionov said Pulikovsky had been given a dressing down over his ultimatum. 3268 !GCAT !GPOL Russian President Boris Yeltsin started a summer holiday on Monday but will remain in charge of affairs of state, his spokesman told Russian news agencies. "The head of state's holiday has only just begun," Sergei Yastrzhembsky was quoted as saying by Interfax. He did not say how long the president would stay on holiday. Yeltsin would be working on papers and might meet certain officials. But Yastrzhembsky added: "We must give B. Yeltsin a chance to rest and recover his health after the elections." Yeltsin has been taking things easy for some time. Aides say the 65-year-old leader, who had two heart attacks last year, needs to rest after his exhausting re-election campaign. They have denied rumours that Yeltsin, seen in public only once in the last two months, is ill and insist he is in full control of policy despite occasional apparent differences in approach to, among other things, the Chechen conflict. Spokesmen said Yeltsin took a two-day trip to Russia's northwestern Valdai lakeland last week to check out a holiday home. But he appears to have decided to at least start his holiday near Moscow. News agencies said the president was at a Kremlin residence called Rus, 90 km northeast of the capital. He may wish to be close to his wife, Naina who was said on Monday to have undergone "a planned operation" on her left kidney and be in a satisfactory condition in a Moscow hospital. Itar-Tass quoted the Kremlin press service as saying the operation took place on Saturday and that she would be released from hospital in a few days. Doctor Sergei Mironov told Tass Naina was "in permanent contact" with her husband and two daughters, Yelena and Tatyana. Interfax said Yeltsin had telephoned his wife several times. Yastrzhembsky did not rule out Yeltsin spending some time outside Moscow. But he insisted the president would remain in charge of affairs of state. "(Yeltsin) controls internal and international policy and daily receives a big packet of documents from Moscow, which demand his intervention," he said. "Many of those documents return to the president's administration the same day." A spokesman for Alexander Lebed, Yeltsin's envoy to Chechnya who arranged a ceasefire in the breakaway region last month, said Lebed could meet the president on Tuesday to discuss his latest attempts to find a political settlement to the conflict. Yastrzhembsky said, however, that president's office had received no request for a meeting or telephone conversation from Lebed, who is secretary of Yeltsin's Security Council. Nonetheless, Yastrzhembsky did not rule out that "during his holiday Boris Yeltsin will hold working meetings". 3269 !GCAT !GPOL Slovak Prime Minister Vladimir Meciar on Monday discussed imminent changes in his government with President Michal Kovac, the president's spokesman said. "The purpose of the premier's visit was to discuss changes to the current cabinet," Vladimir Stefko told Reuters. "The changes were proposed by Mr. Meciar, and the president responded positively." Details on the cabinet changes will be announced on Tuesday, Stefko added. It was not immediately clear why Meciar would want to restructure the cabinet, or which portfolios might be affected. The three parties represented in Meciar's coalition government were shaken in June by bitter squabbling over privatisation and control of the secret service, but managed to avoid a split during inter-party talks at the end of June. The meeting between Meciar and Kovac, who have been at political loggerheads for the past three years, was the first face-to-face encounter in more than a year. Kovac, handpicked by Meciar to become president, was instrumental in the premier's dismissal in March, 1994, calling on parliament to pass a no-confidence motion. Meciar and his Movement for a Democratic Slovakia bounced back that autumn, topping the vote in a snap election and patching together an unlikely coalition made up of nationalist and leftist parties. The cabinet has since whittled away the president's power and several times called for his resignation, but it lacks the necessary three-fifths parliamentary majority to vote Kovac out of office. According to the constitution the president appoints and recalls ministers on the recommendation of the prime minister. 3270 !GCAT !GCRIM An early morning bomb explosion in central Bratislava store on Monday killed an off-duty policeman, the interior ministry said. Spokesman Peter Ondera told Reuters a bomb exploded behind a small foreign currency exchange booth outside the Tesco K-Mart department store in the early hours, fatally injuring the policeman passing by. No extensive damage was reported in the area. The offical TASR news agency quoted the owner of the booth, Marian Lences, 43, as saying it was the second attack against it within three months in what he described as a campaign of intimidation against him. Monday's attack was the second bomb blast in Bratislava in as many days. On Sunday an unspecified explosive destroyed a parked car in the centre of Bratislava and a neighbouring car was burned down in the blast. 3271 !GCAT !GPOL !GVIO Russian soldiers at a checkpoint in central Grozny got a rare taste of Chechen hospitality on Monday when rebel fighters dropped by to share a watermelon during a ceasefire. A bearded Moslem guerrilla pulled out a menacingly long knife from his belt and cut several juicy slices for the weary troops in a scene unimaginable a few days ago, before the bitter enemies agreed to call a halt to some of the heaviest fighting in almost two years of war. The Chechen capital, much of which has been in rebel hands for three weeks, was calm as efforts to consolidate the peace continued. Hundreds of refugees returned to their homes, or at least to see if their homes were still intact and their belongings safe. There was no sign of the much-vaunted joint Chechen-Russian military patrols, but the two sides were co-existing, albeit reluctantly. Behind the checkpoint's huge slabs of concrete and piles of ammunition boxes the former foes made the most of the lull to relax, listen to music or play backgammon. Dmitry, 26, an Interior Ministry officer from St Petersburg, accepted his slice of watermelon gratefully and slung his Kalashnikov automatic rifle over a shoulder to free both hands. "We get on all right with the Chechens," he said, slurping. The rebels controlled the surrounding area, driving around in jeeps and cars letting loose the occasional cry "Allahu Akbar!" (God is Greatest). Russian soldiers looked on, waiting to be relieved by fresh trops who drew up in an armoured car under Chechen supervision. "I haven't seen any of those joint patrols yet," said Dmitry, wiping his sticky hands on a khaki waistcoat whose pockets were stuffed with ammunition. "And I don't expect to see them either. I just want to go home." The two sides agreed to set up the joint patrols at talks last week, and more than 500 Russian and Chechen fighters took an oath to serve in them on Saturday. "We are ready to cooperate," said the checkpoint commander Vladimir Rublyov, 46. "We took an oath to protect the peaceful population, houses and so on. We promised not to shoot and they did the same." Rublyov accepted that the Chechens were masters of Grozny and that the Russian troops who entered the North Caucasus region in December 1994 should leave. "They are on their land here and we are their guests," he said. Another Russian soldier, Alexander, played the guitar and sang Russian ballads with Chechen rebels in green headbands sitting beside him. "They are defending their land, so you can understand them," he said. Some of the Chechens said they would never patrol alongside the Russians. When asked why not, one said: "I am Chechen. He's Russian." In southwest Grozny, a steady trickle of refugees were returning home, some in cars and buses, others on foot. They crossed a half-destroyed bridge over the River Sundzha, patched up precariously with sheets of metal placed on top of pipes. "We left on August 7 when there was bombing all around our house," said Akhmed Gasayev, 56, who was returning with his family of six. "We will take a look and see if it is safe." Tamara Arsakhanova, 46, flashed her gold teeth and asked nervously if there had been any shooting. "We ran away when the fighting started," she said. "They just won't give us peace. We are still afraid." 3272 !GCAT !GPOL !GVIO Alexander Lebed may finally get to discuss his Chechen peace proposals with Boris Yeltsin on Tuesday after a lost weekend in the region when he was forced to abandon plans to sign a new political treaty with the separatist rebels. It could be a sobering experience for the Kremlin security chief who, just two months after being appointed by the president and two heady weeks after taking charge of the Chechen crisis, had promised to wrap up the 20-month war by the weekend. Despite a mood of compromise in the region after some of the worst fighting of the war, Lebed may be just finding out that concluding a long-term settlement, somewhere between rebel demands for independence and Moscow's insistence that Chechnya remain part of Russia, will be no easy matter. A chain-smoking former paratroop general with a sharp line in deadpan putdowns and a soldier's knack for making life sound simple, Lebed managed to arrange an ambitious ceasefire in the region last week, days after the Russian army threatened to bomb its way back into the rebel-held Chechen capital Grozny. He returned at the weekend, pledging to conclude a political settlement that would make this truce work where all others have failed. But then he apparently thought better of it. Saying he needed to tidy up legal loose ends on the deal -- and also cover his back against unnamed pro-war schemers in Moscow -- he flew back to the capital empty-handed on Sunday. He met Russian Prime Minister Viktor Chernomyrdin on Monday and, according to the press service of Lebed's Security Council, could meet Yeltsin on Tuesday. It was not clear if the start of Yeltsin's holiday, announced later, would affect plans to talk. Moscow's as yet undisclosed proposals on Chechnya's political future have, meanwhile, been sent back to do the rounds of various government departments. It is not known what caused the delay in the peace plan. Speculation mounted last week that Lebed was operating out on a limb in Chechnya as Yeltsin, hardly seen since his reelection last month, kept out of sight and then gave an interview criticising his envoy just as he clinched a truce. But Chernomyrdin took pains at the weekend to insist Lebed was playing for a united team and that the proposals he took to rebel chief-of-staff Aslan Maskhadov had been agreed by Yeltsin. If that were the case, it was unclear why Lebed suddenly found it necessary to have the deal verified in Moscow. Lebed himself said he was concerned that powerful interests in Moscow, who have profited from the war and want it to go on, would seize on any inadequacy in the deal to remove him. Maskhadov warned that Lebed risked the same fate as a former Russian army commander in the region who sought a compromise and was blown up last year by -- so the Chechens say -- Russian forces. Maskhadov may also have made new demands on Lebed, forcing him to check back with the Kremlin on what he could offer. A rebel spokesman said the two military men had come close to agreement on a face-saving formula acceptable to both sides and involving a referendum on independence at some future date. Chernomyrdin said voters should decide Chechnya's future but stressed there was no question of the government letting the region quit the Russian Federation -- something Moscow fears could encourage separatist tendencies in other ethnic regions, particularly in the strategic North Caucasus. Lebed may be be finding that closing that political gap between the two sides is more difficult than just ending a war. 3273 !GCAT !GPRO !GREL Albanian President Sali Berisha said on Monday the country was praying for Mother Teresa, an ethnic Albanian, in her battle against a faltering heart. "(Albanians) unite in prayer and hope for your quick recovery and full health so you may continue your humane and divine mission," Berisha said in a telegram, read out on Albanian television. Mother Teresa was born Agnes Gonxhe Bojaxhiu on August 27, 1910, to Albanian parents in the then Serbian town of Skopje, now capital of Macedonia. 3274 !GCAT !GPOL Russian President Boris Yeltsin began a new summer holiday on Monday but would remain in control of affairs of state, Interfax news agency said. "The head of state's holiday has only just begun," the agency quoted Sergei Yastrzhembsky as saying, adding that the president was currently in a Kremlin residence near Moscow. Interfax said Yastrezhembsky did not exclude that Yeltsin could spend some time in other places. He would continue working on various documents and might meet "one state offical or another". "One must give B. Yeltsin a chance to rest and recover his health after the elections," Interfax quoted Yastrezhembsky as saying. "(Yeltsin) controls internal and international policies, daily receives a big packet of documents from Moscow, which demand his intervention...Many of those documents return to the president's administration the same day," he said. Yeltsin went on a two-day trip outside Moscow last week to check out a holiday home. 3275 !GCAT !GPOL Polish President Aleksander Kwasniewski on Monday signed into law a sweeping government reform which aims to make the cabinet more efficient but has prompted a row between the two ruling parties over new posts. Kwasniewski approved seven of the 11 bills triggering the reform on Monday after signing the other four last week. "One can say the legislative process of creating a legal basis for the reform is now complete," presidential spokesman Antoni Styrczula told a news briefing. The reform, scrapping several ministries, creating new ones and merging others to streamline decision-making, has again divided the coalition of ex-communists and a peasant party who have shared power since 1993 despite repeated conflicts. The smaller Polish Peasant Party says implementation of the reform should involve the dismissal of the entire current cabinet and appointment of a new one, although the party's influential Agriculture Minister Roman Jagielinski has broken ranks and on Monday argued against this approach. Analysts say such a procedure would give the Peasants a stronger bargaining position during negotiations on appointments in the new ministries. The ex-communist Democratic Left Alliance of Prime Minister Wlodzimierz Cimoszewicz aims to replace ministers gradually from October, when the months-long process of creating new ministries is due to begin. The two parties plan to resume their so-far inconclusive negotiations this week. The hottest argument concerns appointments to the powerful new treasury and economy ministries as well as the finance portfolio, whose role, though diminished, will remain crucial. Newpapers have quoted unidentified coalition sources as saying that trade-offs inside the coalition could lead to the dismissal of Finance Minister Grzegorz Kolodko. Kolodko, a non-party technocrat linked to the ex-communists and the author of the government's economic policy, has won praise from international financial institutions for maintaining economic stablity and growth. 3276 !G15 !G158 !GCAT !GDIP Ethnic Hungarians from Romania said on Monday pressure from the U.S. and the European Union was behind a Hungarian-Romanian friendship treaty that they would like to see renegotiated. "Several signs point to the fact that the United States and the European Union have put pressure (on the two countries)," said Laszlo Tokes, president of the Democratic Alliance of Hungarians in Romania (DAHR). He was addressing a news conference following a meeting between Hungarian Prime Minister Gyula Horn and representatives of ethnic Hungarians from Romania. Horn was not present at the news conference, but a foreign ministry official who took part did not deny Tokes' assertion. "This is a typical case when expectations of the international community fall in line with Hungarians' best interests," said Ferenc Somogyi, state secretary with the Foreign Ministry. The DAHR leadership failed on Monday to convince Horn to renegotiate the treaty, which does not recognise ethnic-based territorial autonomy and collective rights for ethnic Hungarians living in Romania. Despite a request by Hungarian opposition parties for a special parliamentary session to discuss the treaty, the present Socialist-Free Democrat coalition's 72 percent majority means Hungary is likely to ratify the document once it has been signed. 3277 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Poland's Trilateral Commission, grouping representatives of the government, trade unions and employers, failed to agree over pay rises for the enterprise sector next year, PAP news agency reported on Monday. The government proposed to increase wages in state-owned enterprises by 16 percent in 1997, but unions wanted 18 percent. As a result, the unions set up a sub-committee to work out by next Friday an offer acceptable to all sides, PAP said. If negotiations on next year's wage rises are not concluded by the end of the month, the government will make the decision on its own. -- Warsaw Newsroom +48 22 653 9700 3278 !GCAT !GHEA !GPOL Romanian health workers on Monday blasted their government for relying on foreign help to care for thousands of neglected children suffering from AIDS. "Romania has 54 percent of Europe's juvenile AIDS cases, but the health ministry and government are totally indifferent and ignore these poor souls, who are running out of time," said Manuela Canepescu of International Children's Services. Thousands of Romanian children were infected with the HIV-virus that leads to AIDS (Acquired Immune Deficiency Syndrome) by contaminated blood and poor hospital hygiene during the last years of communism. "Romanian society bears responsibility for infecting 98 percent of more than 3,500 children with HIV through injections and transfusions between 1986 and 1989," said Canepescu, a Romanian official working for a British charity. "All that was done so far from the social point of view was done by foreign charities, with funds from abroad. It is time for Romanians to deal with the problem," Canepescu told a news conference. Some 1,250 children have died of AIDS already. Revolution and the execution of Stalinist dictator Nicolae Ceausecu in 1989 ended the taboo on discussing AIDS and lifted the lid on the horrendous state of Romanian healthcare. Harrowing television images of abandoned children slowly dying from AIDS in Romanian orphanages stunned the world and foreign medical charities rushed to provide care. Money poured in as charities like the "Romanian Angel Appeal" set up in 1990 by the wives of the Beatles and Elton John helped renovate squalid buildings housing AIDS children in Bucharest and the Black Sea port city of Constanta. Volunteers from abroad continue to help local Romanian charities provide rudimentary treatment for infected children. Health ministry assistance has never gone beyond promises, say careworkers, who blame poor management and not the country's poverty for their lack of funds. The leftist government has failed to initiate programmes to prevent the spread of HIV and AIDS or to set up adequate social services, they add. "In Constanta, where we have more than 1,000 cases of child AIDS and 70 adults, there is not one government care worker specialising in AIDS," Canepescu said. Those infected face ostracism from a society that still does not properly understand how the disease spreads. Doctor Rodica Matusa, head of the Constanta hospital, which has the largest childrens' AIDS clinic in Romania, urged the health authorities to change laws which she said "mocked those people who are not guilty of causing their disease." "To oblige a person with HIV or AIDS to renew their medical certificate every year to confirm the disease and get a ridiculous 20,000 lei ($6) a month for food is too much to ask of these poor people," Matusa said. Foreign charity workers backed the assessment of their Romanian counterparts. While local health workers no longer dismiss AIDS children as a lost cause the government has not yet abandoned that attitude, they say. The government last week sacked Health Minister Iulian Mincu, formerly the personal doctor of Ceausescu, who was heavily criticised by local doctors for slowing down reforms, squandering foreign aid and mismanagement of resources. 3279 !GCAT !GVIO A Ljubljana court said on Monday it had decided against prosecuting a former Yugoslav general who fought against Slovene troops in a brief war of independence from federal Yugoslavia in 1991. The court said it had dismissed charges that General Milan Aksentijevic had cooperated with enemy forces because he had joined the Yugoslav federal army before hostilities began. Aksentijevic arrived in Slovenia from Belgrade in July to visit his family, and was first brought before Ljubljana's district court on July 18. He was born in Kragujevac in Serbia in 1935 and used to be a member of the Slovenian parliament before independence was declared on June 25, 1991. He left the country with the Yugoslav army after the brief war but was not allowed to return until last year. His Slovenian wife and grown-up children live in Slovenia. Aksentijevic had applied for permission to remain in Slovenia but this was turned down by the Interior Ministry. His appeal will be considered by the end of October, the ministry said. 3280 !GCAT !GPOL Estonia's parliament delivered a rebuff to President Lennart Meri on Monday, giving him far less support than he expected in a secret ballot to elect a new president of the Baltic country. "This result was in some ways a vote of no confidence in what President Meri has done," former caretaker Prime Minister Andres Tarand told Reuters. Meri received only votes 45, although 57 MPs had said publicly they would support him. The secret ballot left him way short of the 68 votes needed for another five-year term, even though it was no surprise that neither of the two candidates had a clear mandate. Arnold Ruutel, 68, a deputy parliamentary speaker who was a senior communist before the former Soviet republic's independence in 1991, won 34 votes, a dozen or so more than expected. Of the 95 votes cast, two were invalid and the rest abstentions. Six of parliament's 101 members did not take part. A second round of voting will now be held at 0900 GMT on Tuesday with nominations to be registered between 0500 GMT and 0700 GMT. The candidates could include Meri, Ruutel and anyone else who gets the backing of 21 MPs. Parliamentary speaker Toomas Savi called a meeting of the leaders of the 10 parties and independent MPs in a bid to resolve the deadlock. He said he was confident the house could find a way to keep the election within its walls by producing a result from the second or even third round of voting on Tuesday. If these fail, the speaker has to convene an electoral college involving the 101 MPs and 273 local government representatives to elect the president which could take up to a month to organise. Supporters of Ruutel are keen for the vote to go to an electoral college as he has strong support in rural areas and it would give him a greater chance against Meri. "Today was like a vote of conscience, or even a vote of no confidence," Savi told Reuters. "But tomorrow I think a voice of reason will prevail and MPs will think like statesmen and produce a result." Although the charismatic Meri, 67, remains popular among Estonia's 1.5 million population since winning the country's first presidential election in 1992, his support in parliament has waned. Many politicians accuse him of overstepping his role and taking too much power, creating an unofficial upper house of parliament. In 1994 he angered MPs when he signed an agreement in Moscow for the withdrawal of Soviet troops from Estonia, which left some former Soviet military personnel in the country, without consulting parliament. Some politicians, led by Endel Lippmaa, have suggested Moscow has influence over Meri. Meri has had to contend with allegations during the campaign that he used to collaborate with the Soviet secret police when he travelled abroad as a documentary filmmaker before independence. Political analyst Rein Toomla from Tartu University said Meri's poor result could have been affected by a last-minute dirty tricks campaign by Lippmaa, who handed a file he alleged showed links between the former Soviet security police KGB and Meri and his father to all MPs as parliament convened on Monday. "These sorts of tricks are a little bit dirty but they do put questions in people's minds," Toomla told Reuters. 3281 !GCAT !GDIP !GPOL !GVOTE Bosnian refugees in Hungary have cast their ballots in national elections, opening the way for voting by hundreds of thousands of others still exiled from their homeland. The Organisation for Security and Cooperation in Europe (OSCE) said on Monday voting was complete in the 2,000-strong Bosnian community, just under half of whom are in camps. Most of these are Moslems. "The vote was on Sunday and went off very well," OSCE representative Zoltan Szilagyi told Reuters. "People voted in five refugee camps across the country." Under the Dayton agreement, Bosnian citizens living abroad can also vote for parliamentary and local council candidates prior to the Bosnian elections set for September 14. The vote in the camps took place three days ahead of the official start of proxy voting for practical reasons, Szilagyi said. "We had played with a number of dates in the run-up and had informed the camps that Sunday would be polling day. We recommended keeping that date and we received permission to go ahead from the OSCE's Sarajevo office." Szilagyi said first reports suggested a near 100 percent turnout among those eligible to vote and added that he believed there were no irregularities. "We got the impression that everything was in order," he said. "We had two OSCE observers and they reported no complaints." The OSCE in Sarajevo announced earlier that international monitors will decide on Tuesday whether to postpone municipal elections in Bosnia because of alleged irregularities in registering refugees abroad. Officials say irregularities in the registration of some of the 600,000-plus Bosnian refugees around the world, representing about 20 percent of the country's total electorate, have distorted the ethnic mix of key towns. Szilagyi said the registering of voters in Hungary had passed off smoothly. Voting inside Bosnia is scheduled for September 14, when Bosnians are supposed to elect municipal and cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency. Szilagyi said Sunday's elections in Hungary were for all categories, and added that more votes will be organised among other Bosnian communities, with the next poll on Saturday in the town of Harkany near the Croatian border. The ballot papers will be opened and counted in Bosnia. 3282 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Thousands of workers of Serbia's Zastava arms factory entered the second week of protests on Monday over unpaid wages and the lack of a programme to revive the plant's production. "We are stubborn, have strength and time to persist until our demands are met," said the factory's trade union secretary Dragutin Stanojlovic. "We are united and we are waiting for the government to decide what to do with us." Trade unions demanded payment of June and July wages and last year's holiday pay, and called on government to develop a revival programme for the plant. The former Yugoslav national army consumed 90 percent of Zastava's pre-war output, but like the rest of Yugoslavia's economy, the new army of Serbia and Montenegro is crippled by lack of funds. In Kragujevac where the plant is based, 9,000 to 10,000 people gathered in the central square to express their bitterness at what Stanojlovic called government indifference. The ruling Socialist Party last week accused Serbia's opposition of stirring up social unrest and using workers' already difficult social position for their own interests. "Late wages, no work and (the lack of a) production programme are the main reasons for their protests," a senior member of the local Socialist Party branch told Reuters. "But there is a significant influence of opposition parties that are collecting points ahead of coming elections." Federal Yugoslav elections are due on November 3. The party official said the union's figure on the number of protesters was exaggerated. "There were about 1,400 to 1,600 people at the protest today -- much less then last week. "But there were more observers and passers by," he said. -- Gordana Kukic, Belgrade Newsroom +381 11 222 4254 3283 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Bulgarian air traffic controllers will go on strike on September 3 demanding higher pay, the chief of the Bulgarian association of air traffic controllers (Bulatka) said on Monday. Stefan Raichev told a news conference the strike by more than half of the 1,380 traffic controllers and technicians would paralyse traffic which has increased by 10 percent since last year. More than 1,500 planes per day fly over Bulgaria, in a strategic location between Europe and the Middle and the Far East, Raichev said. The director general of the air traffic service Valentin Valkov said last Friday that a controllers' strike would be illegal. Valkov said he could not curb the summer charter flights of national carrier Balkan Airlines, which carries thousands of foreign tourists to the Bulgarian Black Sea resorts. But Raichev said it would be "discrimination" against the other airlines if only Balkan planes were guided in. "Under the law before launching the strike we have to sign an agreement with our employer for a minimal transport servicing of emergency flights," Raichev said. Raichev said a lock-out with military air controllers was impossible as they did not speak English. The controllers are demanding the monthly wage be increased to $1,000 per month from the current $230, as well as the resignation of the air traffic service's management. They also demand the financial separation of the 350 air controllers from the technical staff. -- Liliana Semerdjieva, Sofia Newsroom, 359-2-84561 3284 !GCAT !GPOL Estonian President Lennart Meri's hopes of re-election suffered a setback on Monday when he fell far short of securing enough votes in a secret ballot of members of parliament. Estonia's 101-member parliament gave neither Meri nor rival Arnold Ruutel, deputy parliamentary speaker, the necessary 68 votes to win the election in this small Baltic state which won independence from the Soviet Union in 1991. With 95 members of parliament taking part in the secret vote, Meri won 45 votes, Ruutel 34 and the rest abstained, leaving the incumbent 23 votes short of the majority he needs for a new five-year mandate. Meri had been forecast to win between 50 and 60 votes while Ruutel was tipped to win between 20 and 30. A second round of voting will now be held on Tuesday morning at 0900 GMT with the election open for new nominations, which can include Meri and Ruutel. The two candidates with the highest number of votes will then go to a third round of voting later on Tuesday. If this fails, the parliamentary speaker will convene an electoral college of 101 members of parliament and about 273 local government representatives for a new vote which could take about a month. Some politicians have accused Meri of overstepping his role in the past four years, for example in signing an agreement in Moscow in 1994 for the withdrawal of Soviet troops from Estonia without consulting parliament. The battle for the presidency was reminiscent of Estonia's first presidential election in 1992 when Meri and Ruutel were the leaders in a four-candidate race. The country's second largest daily, Eesti Paevaleht, praised Meri for his strong leadership over the past four years but said it was disappointing that he had never firmly dismissed allegations of collaboration with the Soviet KGB before independence first raised in 1992. In television interviews on Sunday night, Ruutel challenged Meri once and for all to deny he had any links with the KGB between 1960s and the 1980s, when he travelled extensively abroad in his role as a documentary film maker. Meri dismissed the accusations as groundless. 3285 !GCAT These are the main stories in Latvian newspapers on Monday. Prepared for Reuters by the Co-operation Fund. Reuters has not verified these reports and does not vouch for their accuracy: ALL NEWSPAPERS - President Guntis Ulmanis believes that replacing the commander of the National Armed Forces, Colonel Juris Dalbins, will not solve the problems in the armed force. - As of July 1 Latvia's foreign debt was 220 million lats and the domestic debt was 156 million lats, Finance Minister Aivars Kreituss announced at a news conference. DIENA - A joint military exercise of the Latvian and German navies will take place from August 29 to September 6 with a focus on detecting and neutralising mines. BIZNES & BALTIYA - Different sources say that the Russian Government has not approved the abolition of tariffs for cargoes transported by Russian railroads to harbours in Latvia and Estonia. The issue will be discussed at the meeting between Prime Minister Andris Shkele and Victor Chernomyrdin in Moscow. DIENAS BIZNESS - Latvian railway company ends the first half of 1996 with a net profit of 4.2 million lats. - A new oil terminal, Naftas parks, has opened in Ventspils. - The vacation season has boosted cash in circulation in Latvia to the record level of 246.32 million lats. -- Riga Newsroom +371 7226693 3286 !GCAT Lithuanian newspapers carried the following reports in their Monday editions. Reuters has not verified these stories and does not vouch for their accuracy: LIETUVOS RYTAS -The Lithuanian Christian Democratic party discussed its platform and list of candidates for October's parliamentary elections during the weekend. - An open auction on the National Stock Exchange today opens the second privatisation stage in Lithuania. - International audit company Arthur Andersen reported that Hermis Bank had 10.8 million litas net profit during the first six months of this year. The assets of the HB were put at 390.7 million litas. RESPUBLIKA - The unemployment rate was 2.8 percent less in July than in June and there were 118,600 unemployed people in Lithuania, a Labour Exchange report reveals. - The Lithuanian Democratic Party promises to pay major attention to agricultural reform, impose order in the tax system and to pay special attention to the fight against corruption in its election programm. -- Riga Newsroom +371 7226693 3287 !GCAT The following are the reports carried by Estonia's newspapers on Monday. Reuters has not verified these reports and does not vouch for their accuracy: SONUMILEHT - The SILMET metallurgy plant is prepared for privatisation, but there are fears about the nearby drying lake of waste products, which may spread radioactive dust. - Polish naval commander Ryszard Lukasik attended the opening of a memorial plaque to the Polish submarine Orzel, which was interned in Estonia in 1939. EESTI PAEVALEHT - General Gunter Desch of the German Army medical service will visit Estonia to discuss closer cooperation and accelerated transition to NATO standards. - Two police commissars, who were punished for an irresponsible shooting in Saaremaa, deny the accusations and claim to be victims of a plot. POSTIMEES - Representative of the Moscow patriarchate announced on Friday that the conflict with the Constantinopole patriarchy has been solved and a preliminary agreement has been reached. ARIPAEV - A number of businessmen expressed their support for presidential incumbent Lennart Meri, prefering him to challenger Arnold Ruutel. - The merger agreement of the Savings Bank and Industrial Bank was signed on Saturday. -- Riga Newsroom +371 7226693 3288 !GCAT !GDIP !GPOL !GVOTE Irregularities in preparing next month's Bosnian elections threaten chances of mending the country's communal divide, a top U.N. official said on Monday. "In the run-up to the elections, nationalistic leaders are playing the ethnic/sectarian card, drumming up support within their constituencies by playing on bitter memories of fear," said Soren Jessen-Petersen, UNHCR Special Envoy for Former Yugoslavia. Jessen-Petersen referred specifically to apparent electoral engineering in the voter registration of Serb refugees to give Serb separatists the edge in areas once dominated by Moslems. "UNHCR's growing concern is that the tactics used in the campaign will produce hard-line winners and xenophobic nationalists committed to the maintenance of hostile, homogenous statelets." International monitors allege that Serb officials have discouraged Serb refugees from registering to vote in places where they lived before the war. Instead, refugees have been directed to cast ballots in strategically important towns which once had a Moslem majority but which are now underpopulated because non-Serbs were killed or driven out during the 43-month Bosnian war. Diplomats say the Serb aim is to secure final control of municipal assemblies in targeted towns inside the 49 per cent of Bosnia known as the Serb Republic, confirming through the ballot box what they had seized during the war. "Unless all refugees and displaced people are allowed to vote freely on election day and unless the results of the elections are fully enforced, the winners again will be those who waged the war," Jessen-Petersen warned. 3289 !C12 !CCAT !GCAT !GCRIM !M12 !MCAT Russia's government bond markets will remain vulnerable to fraud until uncertainties about the treatment of bearer bonds are clarified, a senior Russian banker said on Monday. The legal authorities froze $24.22 million of stolen and missing MinFin bonds in June, hitting bond prices, and banking sources said on Friday the authorities are preparing an order to freeze up to another $7 million of stolen bonds. But bankers said this treatment of bearer bonds appears to contradict Russia's civil code. "The problem is how the prosecutor-general and other judicial bodies can think they have the right to bend the rules," a top official at Vneshtorgbank, who declined to be named, told Reuters. Vneshtorgbank is the main depository for the dollar-denominated MinFin bonds, which are bearer securities and are traded actively in Russia and abroad. Russia's civil code says bearer bonds cannot be seized in any way from people who bought them in good faith. Bankers said bonds from both the first batch of MinFins frozen in June and from those for which a freezing order is now being prepared had been bought in good faith in the market by operators who did not know they had been stolen. The finance ministry said it would not service the frozen bonds, but it was some weeks before it calmed the market by saying how many bonds were involved and listing their numbers. It is still not clear how it will react to any further freezing, although the market already has some idea of how many bonds could be affected. "For the financial community, it is quite understandable that some bonds may be stolen. What is not understandable is why they did not give any information about them," said Eurobank dealer Olivier Coursault. The Vneshtorgbank official said freezing bonds in this way actually allows dishonest market participants to make money. "The bond owner can give papers to a potential crook and the two make gains selling bonds. The crook disappears and the owner claims the "lost" bonds, saying he is a victim," he said. The civil code's formulation that a buyer in good faith cannot be held responsible if bonds turn out to be stolen implies the party which loses the bonds is responsible, the official said. "Somebody should first prove that somebody else has stolen papers and then demand compensation. Neither the police nor the prosecutor-general has the right to violate the rights of those who have bought and hold papers in good faith", the banker said. This problem affects not only MinFins but other bearer bonds such as veksel promissory notes and OGSZ savings bonds. This possibility of fraud and the related uncertainty could also put foreign investors off from buying Russia's planned Eurobonds, even though these are not bearer securities, he said. He added that Russia's central bank, with Vneshtorgbank, is developing an improved system for registering MinFins. A custody system based on a unified custodian depository could be created by agreements with all the market participants. "But no fine-tuning will resolve the problem until the basic matters of principal are resolved," he said. --Moscow newsroom (095) 941 8520 3290 !GCAT !GPOL !GVIO The chairman of the Crimean Peninsula's parliament was kidnapped over the weekend but escaped, his deputy said on Monday. Deputy chairman Anyshevan Danelyan told an emergency session of parliamentary leaders that chairman Yevhen Suprunyuk, held in a cellar, disarmed one of his captors and escaped but had suffered serious head injuries. Suprunyuk was seized on Saturday after he returned from Ukrainian Indepedence Day celebrations in Kiev, Danelyan said. Police are investigation the abduction, he added . Suprunyuk is more sympathetic to Kiev than his predecessors in the peninsula, which has a largely Russian population and where many seek closer ties to Moscow and looser ones to Kiev. The region, with a population of 2.7 million, was part of Russia for nearly two centuries until the Kremlin gave it to Ukraine, then a Soviet republic, as a "gift" in 1954. Some local politicians said the kidnapping could be linked to an emergency session of parliament, due to open on Wednesday and discuss a vote of confidence in the Crimean goverment. The statement said Suprunyuk had asked parliament to postpone the special session. Parliamentary leaders also called called for better protection for local officials. Crimea, whose beaches and mountain scenery draw millions of tourists each year, has also become a theatre for gangland murders and explosions in public places. Seventy five contract killings were recordered there last year. Official statistics show half of Ukraine's serious crimes are committed in Crimea and the two eastern industrial regions of Donetsk and Dnipropetrovsk. 3291 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Russian air traffic controllers called off a strike due to start on Tuesday, a union official said on Monday. The strike was called off after a deal was struck linking wages to inflation, social benefits and job guarantees. "The deal envisages new increased payments for 1996-1997 which will raise the wages of aviation workers to a minimum level," Gennady Borisov, deputy head of the Federation of Air Traffic Controller Unions, told Reuters. The deal affects the five major aviation unions, including air despatchers, flight crews, technicians and radar workers. --Robert Eksuzyan, Moscow Newsroom +7095 941 8520 3292 !GCAT !GPRO Naina Yeltsin, wife of the Russian president, has undergone "a planned operation" on her left kidney and is in a satisfactory condition, Itar-Tass news agency said on Monday. Tass quoted the Kremlin press service as saying the operation took place on Saturday in the Central Clinical Hospital which treats top officials. Mrs Yeltsin would be released from hospital in a few days. Doctor Sergei Mironov told Tass Naina was "in permanent contact" with her husband and two daughters, Yelena and Tatyana. The state of health of Boris Yeltsin, who had two heart attacks last year, has been the centre of media and market speculation after he won a second term in office in the July 3 election run-off and all but disappeared from the public eye. A presidential spokesman said on Monday Yeltsin was in Moscow but could give no details about his agenda or whether meetings were planned. Yeltsin is expected to go on holiday in the near future, but officials have not yet said where he will go or when. 3293 !GCAT !GPOL Estonia's parliament on Monday failed to elect the Baltic state's next president when the two competing candidates failed to secure enough votes. Neither incumbent president Lennart Meri nor rival Arnold Ruutel deputy parliamentary speaker won the necessary 68 votes from the 101 member parliament to win office. With 95 members of parliament taking part in the secret ballot, Meri won 45 votes, Ruutel 34 and the rest abstained. Politicial analysts said Ruutel won more votes than had been forecast, A second round of voting will now be held on Tuesday morning at 0900 GMT with the election open for new nominations, which can include Meri and Ruutel. The two candidates with the highest number of votes will then go to a third round of voting later on Tuesday. If this fails, the parliametary speaker will convene an electoral college of 101 members of parliament and about 273 local government representatives for a new vote which could take about a month. 3294 !GCAT !GPOL Arnold Ruutel, underdog candidate in this week's presidential election in Estonia, is a stark contrast to the incumbent President Lennart Meri, who speaks eight languages and mixes easily in international circles. Born into a farming family on the island of Saaremaa, Ruutel, 68, studied agriculture and eventually become chancellor of Estonia's leading agricultural college. He was a member of the communist party from 1964 to 1990, when he became head of the Supreme Council, Estonia's parliament during Russian rule which was answerable to the communist party's central committee in Moscow. He is currently deputy parliamentary speaker and is popular with rural communities and older Estonians. For despite Ruutel's communist past, political analysts said he was not seen as pro-Moscow and was one of the leaders of Estonia's independence drive. "The president must defend national interests," Ruutel said in an interview with daily newspaper Eesti Paevaleht when asked his views on the president's role. But many Estonians doubt his ability to impress the international community as he only speaks two languages -- Estonian and Russian -- and lacks the charm and wit of his rival. 3295 !GCAT !GPOL Estonian president Lennart Meri made his mark on the small Baltic state's history over the past four years, taking the most high profile role in the nation during its hesitant first steps as an independent nation. While the goverment's performance has been mixed since Estonia broke from the Soviet Union in 1991, the charismatic president has consistently steered the country towards Europe, spearheading a bid for entry to the European Union and NATO to safeguard against any future Russian expansion. Winning respect from Estonia's population of 1.5 million for his intellect and ability to hold his own on the world's political stage, his popularity has been marred by politicians' resentment of the way he has taken control. Meri has not always consulted parliament on his actions -- such as signing an agreement on the withdrawal of Russian troops in 1994 -- and has been accused of making the presidency into an unofficial upper house of parliament. It is this criticism that has hampered his chances in this week's presidential election in which he will compete against arch-rival, former senior communist Arnold Ruutel, in a secret parliamentary ballot. "Meri is still popular but the problem is that he is seen by some to have overstepped the mark," political scientist Rein Toomla from Tartu University told Reuters. Meri, 67, was well known in Estonia as a novelist and documentary film maker before entering the political arena in 1990 as foreign minister. But his leadership qualities did not emerge until after 1992 when he won the first presidential election in the smallest and most northerly of the three Baltic nations, beating three other candidates including Ruutel. Political commentators said the high point of Meri's years in office was his handling of the government's collapse in October last year in the midst of a bugging scandal. "Meri's reputation as free of corruption and a dignified politician has won him great admiration," said one political commentator. Meri has stressed the need for Estonia to stay clean of corruption which has become an increasing problem since the end of Russian rule. "We have a deficit of trust and lack of confidence in Estonia," Meri said in an interview with Estonia's largest daily newspaper Postimees last week. "If we can't stop corruption then we will make Estonia weaker and undermine our trustworthiness in the eyes of our partners." 3296 !GCAT !GPOL Estonia's parliament will hold a secret ballot on Monday to choose the next president for the smallest of the three Baltic states which declared independence from the Soviet Union in 1991. Incumbent president Lennart Meri and his arch-rival Arnold Ruutel, the deputy parliamentary speaker and former senior communist, will face each other in the contest to be elected head of state for the next five years. Although the charismatic Meri is the favoured candidate, it remained unclear just hours before the vote whether he had enough support to win the required 68 votes from the 101 member parliament (Riigikogu). Parliament convened for an extraordinary meeting at 0800 GMT with MPs. The candidates may be called to address the gathering before voting begins. Some politicians have accused Meri of overstepping his role in the past four years, such as the 1994 signing of an agreement in Moscow for the withdrawal of Soviet troops from Estonia without consulting parliament. "Today will probably not produce a president," the frontpage headline of the country's largest daily newspaper Postimees said on Monday. If neither candidate secures 68 votes, a second round of voting will be held on Tuesday morning with the list open to new candidates. The two with the highest number of votes will go before a third round later in the day. If this fails, the parliamentary speaker will convene an electoral college involving all MPs and about 273 local government representatives for a new vote. This could take about a month. But the editorial in the Postimees urged the parliament, elected 18 months ago, to try to make a decision without the need to go to an electoral college. "The parliament should prove it is capable of choosing the president as to do otherwise would show parliament's inability to fulfil the task," the editorial said. The battle for presidency was reminiscent of Estonia's first presidential election in 1992 when Meri and Ruutel were the forerunners in a four candidate race. The country's second largest daily, Eesti Paevaleht, praised Meri for his strong leadership over the past four years but said it was disappointing that he has never firmly dismissed allegations of pre-independence KGB collaboration which were first raised in 1992. In television interviews on Sunday night, Ruutel challenged Meri once and for all to deny he had any links with the KGB during the 1960s to the 1980s when he travelled extensively abroad in his role as a documentary film maker. Meri dismissed the accusations as groundless. 3297 !GCAT These are the leading stories in the Skopje press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. DNEVNIK - Macedonia and Yugoslavia are to redraw their border and create a Free Trade Zone. Negotiations start today with a meeting of diploamtic experts and ends with the visit of Yugoslav Prime Minister on September 4. - Macedonia will buy Russian arms under a defense agreement to be signed at the end of this year. - The ruling coalition parties - the Social-Democratic Union of Macedonia (SDMU) and the ethnic Albanian Party of Democratic Prosperity (PDP) are expected to agree today on several PDP requests for changes to the territorial division law which will satisfy the aspirations of Macedonia's Albanian minority for local and regional autonomy. Today's talks will end at the scheduled government session this afternoon. VECER - Macedonia's political parties are still dissatisfied with the government's proposed changes to the local elections law. -- Skopje newsroom 389 91 +201196 3298 !GCAT These are the leading stories in the Sarajevo press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. OSLOBODJENJE - Main Bosnian Moslem nationalist Party of Democratic Action (SDA) debates its participation in September elections during a special Sunday session. DNEVNI AVAZ - Main Bosnian Croat nationalist party marks its sixth anniversary with a rally in Sarajevo. About 1,000 supporters cheered as the Croat Democratic Union (HDZ) presented its main candidates for September's nation-wide Bosnian elections. --Sarajevo newsroom, +387-71-663-864. 3299 !GCAT These are the leading stories in the Belgrade press on Monday. Reuters has not verified them and does not vouch for their accuracy. POLITIKA - The association of banks of Yugoslavia plans to reintroduce certified checks in a bid to promote non-cash payments. - Sugar plants propose increasing the area under sugar beet to 110,000 from 100,000 hectares next year. - The head of the Belgrade Socialists Branislav Ivkovic said left-oriented parties with the same approach to political work would cooperate and help each other at the forthcoming elections. - Montenegrin President Momir Bulatovic expresses satisfaction with the Belgrade-Zagreb normalisation agreement. - Montenegro's Social Democratic Party joins the coalition of two strongest opposition parties, the People's party and the Liberal party, for the forthcoming elections. NASA BORBA - Former governor of the National Bank of Yugoslavia, Dragoslav Avramovic welcomes Yugoslav government's decision to normalise relations with the IMF but regrets that the move had been made with a delay of almost one year, since he first proposed it. - Artificial lowering of the discount rate increases pressure on the stability of the domestic currency, says professor of the Belgrade School of Economics Djordje Djukic. - Serbian Oil Industry NIS registered a loss of 433 million dinars in the first half of this year. POLITIKA EKPSRES - Zemun factory Zmaj says another agreement soon to be signed on the delivery of agricultual machines to the Chinese market to the value of $50 million. VECERNJE NOVOSTI - New Macedonian ambassador Slavko Milosavleski to arrive in Belgrade soon. - Situation in the Electronics industry Nis (EI Nis) is very concerning. Its production is now worth 200 million German marks, down from earlier levels worth 800 million, says director general Radisav Paunovic. BORBA - Some 100,000 refugees will cast their ballots in 60 polling stations in Yugoslavia from August 28 to September 3 for the first democratic elections in Bosnia, says Serbian commissioner for refugees Bratislava Morina. -- Belgrade newsroom, 381 11 +224305 3300 !GCAT !GVIO At least 450 Russian soldiers were killed and almost 1,300 were wounded in fighting for control of the Chechen capital Grozny since August 6, Interfax news agency said on Monday. Interfax, quoting sources at the Russian joint command, said the bodies of 451 soldiers had been flown out of the region since Chechen rebels seized much of Grozny on August 6. A total of 1,264 wounded soldiers had been evacuated. But the casualty figures were not final ones. Interfax said dozens of soldiers were still missing after the Chechen raid, which led to the heaviest fighting in the Caucasus region in more than a year. The situation calmed last week after rebel military leaders sealed a truce with Russia's Alexander Lebed, President Boris Yeltsin's special envoy to the region. Lebed, seeking official approval for a Chechnya peace deal, was in Moscow on Monday. Casualty figures have been notoriously unreliable throughout Russia's 20-month-old bid to crush Chechnya's independence drive and each side tends to exaggerate enemy losses and play down its own casualties. Tens of thousands of people, most of them civilians, have been killed since the conflict began. 3301 !GCAT Here are highlights of stories in Romania's press on Monday. Reuters has not verified these stories and does not vouch for their accuracy: Business: ADEVARUL - Government approved ordinance on creation of bank deposit insurance system. Deposits of up to 10 million lei are to be insured. - Distribution of shareholders' certificates under mass selloff scheme is scheduled to end early in September. - Postprivatisation fund was created to support privatised companies with credits. TINERETUL LIBER - Investors to suspended Credit Fond investment fund, which resumes activities on Monday, decided fund would continue to operate as open-ended fund administered by fund manager Certinvest SA. ZIUA - Price of four-wheel-drive ARO cars to go up 25 percent. LIBERTATEA - Private companies operating in oil sector plan to set up national oil and gas company Petrogas SA. - National Bank signed accord on $175 million syndicated loan with ABN AMRO Bank and Citibank. CURIERUL NATIONAL - U.S. oil company Amoco plans to open four petrol stations in Transylvanian city of Brasov. General: ROMANIA LIBERA - Opposition Democratic Convention (CDR) mayors said they would present in near future a report on their activity in the first 100 days since they were elected as part of the 200-day contract signed ahead of the June 1996 elections. - As many as 184 soldiers in a military unit in Ploiesti were hospitalised with food poisoning. - "Theft of the century" reads headline to one-page report on a recently adopted restitution law allowing tenants to buy houses of which former owners were thrown out after they were nationalised by former communists over the past 50 years. ADEVARUL - Charisma of President Ion Iliescu, running for new presidential term for ruling Party of Social Democracy (PDSR), could add some votes to PDSR, but might loose some percentage unless PDSR improves its image, said Iliescu's campaign manager Iosif Boda. - Romanian pop and popular music singers as well as children to be part of show on August 28 at the official launch of President Iliescu's campaign for a new term. EVENIMENTUL ZILEI - CDR presidential candidate Emil Constantinescu invited President Iliescu to a televised debate on latest scandal following an interview in a Romanian-language magazine in the U.S. alleging that Constantinescu would hand power to Romania's exiled king Michael after winning the November 3 polls. - Interior Minister Doru Ioan Taracila, accused in the media of alleged "bribes, traffick of influence and political implication of the police", says in interview he would resign immediatly should the allegations prove to be correct. - President Iliescu could hire a team of foreign experts in charge of creating a proper image in the electoral campaign for the November 3 presidential elections, said campaign manager Iosif Boda. CRONICA ROMANA - Draft treaty with neighbouring Hungary excludes any reference to collective rights and territorial authonomy on ethnic grounds, says Foreign Minister Teodor Melescanu in an interview. - Leading board of ruling PDSR to debate on Monday the results of its anti-corruption resolution adopted a month ago under which all PDSR members alleged to be involved in corruption scandals had to clear their situation. - Kiss Kalman, head of Free Democrat Hungarian Party in Romania (PLDMR) says treaty with Hungary must signed as quickly as possible. LIBERTATEA - Newspaper presents latest measures taken by the PDSR government ahead of the November 3 general elections, which the newspaper says are nothing but populist measures. - Romania risks to become a supplier for juvenile prostitution, says the newspaper alleging that dangerous paedophiles hide sometimes behind so-called aid organisations. CURIERUL NATIONAL - As many as 312 sentences for child rape were issued last year in Romania, says report on child sex abuse to be presented at the international conference in Stockholm. ($=3,158 lei) -- Bucharest Newsroom 40-1 3120264 3302 !GCAT Following are the main stories in Croatian newspapers on Monday. VJESNIK - Elections in Bosnia-Herzegovina: Croats must be guaranteed equality, says Bosnian HDZ party leader Bozo Rajic at an election rally. Mufti Dzemal Gardar calls for jihad at a Moslem party SDA rally in southern town of Capljina. - Ancillary bishop Marijan Srakic denied access to Lipovac parish in Serb-held Eastern Croatia. - Transport Minister Zeljko Luzavec vows better ferry links between northern and southern Adriatic coast for next summer. - Capital market: Share prices poised for a new rise in the autumn. VECERNJI LIST - More affordable loans for farmers: 95 million kuna to be allocated for homesteads. - State salaries have been rising despite a government clamp-down. Between January and June 1996 total salary payout in banks and other financial institutions has risen by 20 percent, while in institutions not funded by the state budget by 25 percent. - The first rally of the Croatian Democratic Union (HDZ) of Bosnia-Herzegovina held in Sarajevo: A historic day for the Sarajevo Croats. SLOBODNA DALMACIJA - A new political party to emerge on the Croatian political scene: DEHOS for Croatia headquartered in Germany and with branches in Zagreb, Split and Rijeka is to be made up of the Social-democratic union, Dalmatian action as well as a number of left-oriented people from the Croatian political scene (including former communist Stipe Suvar). -- Zagreb Newsroom, 385-1-455775 3303 !GCAT Here are highlights of stories reported by Hungary's press, based on information by Nepszabadsag's Hungary Around the Clock service. For further details on how to subscribe to Hungary Around the Clock, please contact Monica Kovacs at (361) 351 2440 or fax your request to (361) 351 7141. ALL PAPERS - The foreign advisory body of the Democratic Federation of Hungarians in Romania agreed that the grouping must continue to put forward its position regarding a Hungarian-Romanian basic treaty and will confirm its opinion at a meeting with Prime Minister Gyula Horn today. - Collection of the 78 signatures necessary for convening a special session of Parliament to debate the Hungarian-Romanian basic treaty could be completed today. - Responding to reports that Privatisation Minister Tamas Suchman stands the best chance of replacing outgoing minister of industry, Free Democrat President Ivan Peto said his party would not oppose privatisation being overseen by the minister of industry. - German Defence Minister Volker Ruhe predicts in an interview in Bild am Sonntag that NATO membership for Hungary, Poland and the Czech Republic will be granted in 1999. - A seven-kilometer stretch of road leading to a border crossing between Nemesnep in Hungary and Kobilje in Slovenia was inaugurated Sunday by Hungarian President Arpad Goncz and Slovenian President Milan Kucan. - The first half current account deficit of $934 million is a considerable improvement over the same period last year, representing a fall of $1.1 billion, reports the National Bank. - The National Bank has announced it will cut its prime rate by 1 per cent to 24.5 per cent as of September 1. - The government anouncement that the planned October energy price hike would be delayed saw shares in the Hungarian Oil and Gas Co (MOL) plunge Friday by more than 9 per cent and trading in shares was temporarily suspended on the Budapest Stock Exchange. NEPSZABADSAG - The government's decision to delay the expected October energy price hike until January, while it did not violate the terms of privatisation contracts, did diverge from the conditions it had earlier announced in tenders and will compel the privatised energy companies to put up with losses longer than they had anticipated, said representatives of the German energy concern RWE. (Sat.) - A new Border and Internal Supervisory Headquarters is to be established from October 1 under the aegis of the customs authorities to curb the black economy and corruption within the organisation. MAGYAR HIRLAP - President Bill Clinton has sent his greetings to the Hungarian people on the occasion of the millecentennial of the Magyar conquest. (Sat.) - The manufacturing sector is on the verge or a slight upswing and the construction industry faces a continuing, albeit diminishing decline, while an ongoing recession in the retail sector has discouraged small businesses from mark-ups, according to a report by the economic research firm Kopint-Datorg. VILAGGAZDASAG - Hungarian Credit Bank signed a contract on Friday with a syndicate under which it will be extended a $50 million mid-term loan to help extend the range of mid-term credit it offers its corporate clients. MAGYAR NEMZET - The Udvar border crossing has been declared clear of mines, implying that road traffic may now resume between Hungary and the Serb-occupied Croatian territory of Baranya after a five-year hiatus. -- Budapest newsroom (36-1) 266 2410 3304 !GCAT !GPOL !GVIO !GVOTE Large wooden crosses still stand on Bucharest's boulevards in honour of those killed in Romania's violent six-year-old revolution. They are a stark reminder of the era of political violence -- the years of brutal repression, the death by firing squad of dictator Nicolae Ceausescu and the bloody miners riots engineered by former communists. All that is behind us now, say Romania's politicians as they gear up for the November 3 presidential and parliamentary elections, the third of the post-communist era. But while they promise their aggression will only be verbal -- a pledge Western diplomats find credible, although there is no precedent for power changing hands peacefully -- most agree Romania has not yet turned its back on the past. For reformists the election is another chance to rescue the lost opportunity of the Christmas revolt of 1989, which former communists, including current President Ion Iliescu, used to reinvent themselves and gain power. The diehards hope the vote will slow Romania's already sluggardly reform of its Soviet-style command economy, help protect workers from the full shock of transition to a free market and cement the privileges of the ruling elite. "Romania is at a turning point again," said Dorel Sandor, of Bucharest's Centre for Political Studies. "We can continue in the old way, of fragmentation, undermining each other and blocking initiatives, or we can try to change something at last through working together." The stakes are high for this under-developed country of 23 million people, largely of Latin origin, hemmed into the eastern Balkans by Slavic nations and Hungary. If the elections deliver a stable centrist government, with no links to the extremists who keep afloat the ruling coalition of the leftist Party of Social Democracy (PDSR), it would boost Romania's hopes of NATO and European Union membership. If Romania finds itself with a rocky minority government or one unpalatable to the West it could become more isolated, starving the reform process of the foreign investment needed to prevent the economy's collapse. Iliescu launches his candidacy on August 28 and the parties are preparing for the campaign start on September 4. Amid the electoral rhetoric commentators agree on one thing that has changed since the 1992 poll. The PDSR, in power since 1989 and comorised largely of ex-communist functionaries, for the first time feels it could lose. "After the (June) local elections where they fared badly the PDSR feels vulnerable, which they never felt before," said one Western diplomat. Corruption scandals and voter weariness at economic mismanagment are at the root of PDSR unpopularity. Polls show no party winning an outright majority. With power in parliament dependent on coalition strength, the opposition Democratic Convention (CDR) and ex-premier Petre Roman's Social Democratic Union (USD) scent victory. "A new situation has been created in which it has become possible not only to dethrone but even to eliminate the PDSR from the game of setting up a coalition government," leading commentator Silviu Brucan wrote in the daily Adevarul. Unfortunately for presidential hopeful Roman and CDR candidate Emil Constantinescu, polls suggest Iliescu will retain his post, although it will take two rounds of voting. That raises the possibility of a split administration, with presidential losers taking key legislative positions. "The question is whether Iliescu and Constantinescu can live with each other," said Sandor. "They will need to have a larger vision of how to unite forces and Romania could then be a stable country with an efficient parliament." It is unclear if the good will for such a compromise will exist after what is expected to be a hard-fought, muck-raking campaign with graft, jobs and the woeful economy hot issues. Iliescu's message of stability and caution is expected to be welcome in the countryside, where the PDSR should also fare well, boosted by the fact state television, largely supportive of the government, is the only station available. In the cities and areas where Romania's large Hungarian minority predominate, anger at falling living standards and a relatively free media should boost the opposition, which largely supports quicker market reforms. The PDSR hopes Iliescu's popularity will drag it up in the polls, although some commentators suggest the President, realising the PDSR is unpopular, may be distancing himself. That might prompt the PDSR to desperate measures, some commentators say, rather than allow the opposition into power where it can unlock the files of the intelligence services and properly investigate the enrichment of leading party officials. Analysts predict expensive pre-election pledges from the government, which will further harm the already over-stretched state budget, and a feverish atmosphere of intrigue over the next few months as parties large and small jockey for position. "There is already so much political touching and feeling going on its like the back seat of a car at a drive-in movie" said one Western diplomat. 3305 !GCAT !GCRIM !GVIO Kidnappers have seized a Dutch couple who manage a farm in northern Costa Rica and have demanded a $1.5 million ransom, authorities said on Monday. Officials said Humberto Hueite Zyrecha and his wife Jetty Kors, both 50, were kidnapped late on Saturday or early Sunday. Col. Misael Valerio, head of border police at the Security Ministry, told reporters surveillance of the northern border with Nicaragua has been stepped up to keep the kidnappers from fleeing Costa Rica. Preliminary reports said the couple were kidnapped on the "Altamira" farm, owned by Dutchman Richard Wisinga, at Aguas Zarcas de San Carlos near the Costa Rica-Nicaragua border. Unconfirmed news reports said a vehicle belonging to them was found abandoned at Santa Maria de Pocosol, about 12 miles (20 km) north of the site of the abduction. The reports said authorities found a statement, supposedly from the kidnappers, in the vehicle, addressed to Wisinga and demanding a $1.5 million ransom. Wisinga was believed to be travelling in Europe, they said. A Swiss tourist guide and a German tourist were kidnapped in the same area on New Year's Day by a group of former Nicaraguan guerrillas. Regula Susana Siegfried, 50, and Nicola Fleuchaus, 25, were released after 71 days after a $200,000 ransom was paid. In a bizarre twist, Fleuchaus and the leader of the kidnappers, Julio Cesar Vega Rojas, developed a sentimental attachment during her captivity, according to photographs printed in Costa Rican newspapers and court documents including a love letter written by Vega. 3306 !C12 !C33 !CCAT !GCAT !GCRIM Chile will accept bids to operate the new personal telephone service in November after the Supreme Court dismissed a law suit that held the process in limbo for nearly six months, said officials. "The process has been interrupted since March 1...now we will receive offers which will happen in mid-November," an official at the Telecommunications Subsecretariat told Reuters. The official, who declined to be named, said the concessions will be awarded in March after the offers have been studied. Several companies, including BellSouth and VTR Telecomunicaciones, had appealed to the court as they were unhappy with the rules governing the new service. Firms will now have to compete for the three concessions, which will be awarded to operate the new service. Entel, which runs a cellular telephone system in the north and south of the country, said it will apply for a concession to extend its mobile services to Santiago. -- Margaret Orgill/Paulina Modiano, Santiago newsroom, 562-699-5595 x212 3307 !C24 !CCAT !GCAT !GENV Chilean industrial group Compania de Petroleos de Chile SA (Copec) said construction of a $1 billion wood pulp project near Valdivia has been delayed because of environmental concerns. The project, which was due to start early next year, has been delayed by "at least six months and more like a year," said Felipe Lamarca, president. Celulosa Arauco y Constitucion, Copec's pulp division, is studying changes to the plant's design that would carry waste water into the Pacific rather than dumping it in the Cruces River, which raised objections from environmentalists. 3308 !GCAT !GCRIM !GVIO Brazilian police on Monday were scouring a remote Amazon farm close to the site of a massacre of landless farmers earlier this year, where at least one person died in a new outbreak of violence, officials said. "So far we have found one body," said police inspector Vicente Costa in the town of Maraba, in Para state. The body appeared to be that of a private guard employed by the owners of the Sao Francisco estate near Maraba, which has been occupied by landless squatters, Costa said. He added police were investigating claims by one squatter who said he survived being shot in the head by armed men who killed three of his colleagues. Officers were scouring the woodlands where 20 year-old Gilvane Alves da Silva said the shootings took place. In April, 19 landless farmers were killed by police in a clash on a highway near Maraba. 3309 !GCAT !GPOL !GVOTE Surinam's ruling New Front coalition was dealt a harsh blow on Monday when one of the four coalition parties staged a walk-out just 10 days before a vote for president. The Party for National Unity and Solidarity (KTPI), which represents Javanese voters in the former Dutch colony, said it had left the New Front to form a separate political faction. The move followed the New Front's recent decision to ally with the Pendawalima party, which also represents the descendants of 19th century Javanese indentured labourers. The jockeying comes ahead of a Sept. 5 meeting of Surinam's United Peoples Assembly (VVV) to vote for a new president. The 869-member VVV, which includes regional and municipal councilors, will choose between incumbent President Ronald Venetiaan and Jules Wijdenbosch, candidate for the National Democratic Party. Officials of the defecting KTPI said they had not ruled out alliances with either the New Front or NDP for the vote. The NDP is closely associated with Surinam's former military strongman Desi Bouterse who ruled in the 1980s with Wijdenbosch as his right-hand-man. The South American country of 400,000 people has endured two military coups, seven years of dictatorship and widespread guerrilla activity in the last two decades. 3310 !GCAT !GCRIM !GVIO The government expressed "deep concern" on Monday over reports that Colombian police disguised one of their vehicles as a Red Cross ambulance during last week's riots in southern Colombia. "The national government ... views with deep concern events reported by the domestic news media regarding the supposed undue use of International Red Cross symbols by Colombian police," the foreign ministry said in a statement. It said the government fully respected the 1949 Geneva convention mandating world recognition of the Red Cross and its autonomy and said it hoped "investigations will allow for the facts and responsibilities to be established as soon as possible." Television pictures of police unloading tear gas cannisters from the back of a truck clearly marked with the internationally recognised Red Cross symbol have been shown repeatedly in Colombia since Friday when full-blown riots erupted in Florencia, capital of Caqueta province. In the footage, police can also be seen bundling at least two rioters into the back of the vehicle. The incident has prompted a public outcry from Red Cross officials in Bogota and Geneva, who note that the misuse of the organisation's symbol was strictly forbidden by international law. The foreign ministry said it was also forbidden under Colombian military law and the penal code used to enforce discipline in the National Police. Friday's riots, which police and other military officials have blamed on leftist guerrillas, capped a month of protests in Caqueta and two neighbouring provinces over the government's drug crop eradication programme. 3311 !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto left Brasilia on Monday for Lima, the penultimate stop on a 10-day Latin American tour, a Brazilian Foreign Ministry spokeswoman said. Hashimoto, who has already visited Mexico and Chile, spent three days in Brazil. After Peru, he was due to go to Costa Rica. 3312 !GCAT !GPOL !GPRO Nicaraguan President Violeta Chamorro underwent successful surgery in the United States on Monday to correct a compression in her lower spinal column, the government said. Doctors at Johns Hopkins Hospital in Baltimore found an inflamation in her spinal column that, once treated, will free her of chronic pain in her back and one leg that has limited her movement, a government statement said. "(Chamorro) is in good health and, according to her doctors, will be able to return to Nicaragua next week," it said. Chamorro, 66, had complained of lower back pain since a trip to Taiwan in May, when pain forced her to go to Taipei University Hospital for an examination. She suffers from osteoporosis, a disease that weakens the bones, and has repeatedly flown to Washington for treatment. She is scheduled to step down in January after a term of nearly seven years. 3313 !E21 !E212 !ECAT !GCAT !GPOL A Brazilian senator intends to present to the Senate Economic Affairs Committee on Tuesday a bill authorizing the Central Bank to engage in unlimited Brady bond buyback operations and debt swaps, an aide to the senator said. The aide to Senator Vilson Kleinubing, appointed by government leaders to draw up a more favourable alternative to a bill being drafted by Senator Roberto Requiao, said a vote was expected to take place some time after 1000 local/1300 GMT. "The sentaor's bill is quite liberal," the aide said. "It does not limit Brady buybacks or debt swaps and sets no minimum price. The prices and fees for managers will be set by the international market. It couldn't be any other way." The Central Bank asked the Senate some three months ago to allow it to restructure its foreign debt portfolio, in particular its $57 billion in outstanding Bradies. But Requiao, the senator originally appointed to draft a report, was not convinced of the merits of buyback and debt swap operations and has drawn up a bill that severely ties the Central Bank's hands. The only similarity between Requiao's and Kleinubing's versions is that the Central Bank will have to report to the Senate everytime its operations amount to $500 million. Requiao had also demanded the bank report every 30 days and he set a minimum price and barred lead managers who hold Brazilian debt from handling any of the operations. The aide to Kleinubing said it was as yet unclear if Kleinubing's or Requiao's draft bill would be voted first. -- Michael Christie, Brasilia newsroom 55-61-2230358 3314 !GCAT !GDIS Eight members of a family, five of them children aged between two and seven, drowned when their small boat sank on Lake Maracaibo in western Venezuela early on Monday, authorities said. The accident happened when the Sanchez Zarraga family took their boat out for a nighttime spin, Civil Defence and Coast Guard officials said. The cause of the sinking was not known but officials said the boat had a hole in the stern and no lifejackets. Three members of the party were rescued unhurt. 3315 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Miners at Salvador, the smallest of state copper company Codelco's four divisions, will vote Tuesday on the corporation's final pay offer in scheduled wage talks, said union officials. "Tomorrow miners will vote on whether to strike or accept Codelco's offer," Guillermo Donoso, treasurer of union number one told Reuters. Codelco has offered Salvador's 2,400 miners a three percent pay increase in real terms for a 36 month contract, he said. Although the offer is "economically acceptable," miners are unhappy with Codelco's plans to change the way the division's four schools are managed, he said. "The sticking point over the schools makes the situation uncertain," said Donoso. Codelco officials were not immediately available for comment. The result of the vote will be known Tuesday at around 2230 Tuesday (0230 GMT Weds) and a strike would start on September 1 when the existing contract expires, he said. The vote comes just four months after miners at Codelco's huge Chuquicamata pit went on strike for 10 days following a breakdown in wage talks. Salvador produced 42,901 tonnes of fine copper in the first six months of the year up from 41,574 tonnes in the same period 1995. -- Margaret Orgill, Santiago newsroom, 562-699-5595 x212 3316 !E41 !ECAT !GCAT !GJOB The unemployment rate in Sao Paulo city dropped to 15.7 percent in July, down from 16.2 percent in June, the Labor Union Statistics Institute (Dieese) reported. In a statement, Dieese said it was the first time since February that unemployment has shown a decrease. The number of unemployed workers fell to 1.335 million in July, down from 1.385 million in June, it said. July figures, however, rose against the same month last year when the share of unemployed workers hit 13.1 percent of the workforce, or 1.076 million workers, it added. -- Romina Nicaretta, Sao Paulo newsroom, 55-11-2324411. 3317 !GCAT !GVIO Suspected right-wing gunmen dragged three people out their homes in a rural area of northwestern Colombia on Monday and shot them to death, authorities said. It was the second such killing since Saturday morning in the violence-torn province, where gunmen have operated with impunity for years. Police initially blamed leftist guerrillas for Saturday's killings, in which 10 men were dragged screaming from their homes and killed in the rural municipality of Anza, but witnesses said the massacre had the hallmarks of a right-wing paramilitary group, even though rebels maintain a strong presence in and around Anza. Local government officials and police said the killings early on Monday in the municipality of Sonson also appeared to be the work of extreme rightists. Before fleeing, the gunmen, in olive-drab military uniforms and brandishing automatic rifles, spray-painted slogans alluding to so-called "autodefensas" or paramilitary groups operating in Antioquia and neighbouring Cordoba province. In other developments, military spokesmen said two civilian pilots held hostage by National Liberation Army (ELN) rebels in Antioquia were released unharmed on Monday when troops discovered the guerrilla encampment where they had been held since June. Enrique Arbelaez Piedrahita and Antonio Jose Restrepo Uribe were kidnapped after landing at a rural landstrip. They were told that the ELN was requisitioning their aircraft, the spokesmen said. The ELN, Colombia's second largest guerrilla group, specialises in kidnapping and economic sabotage. 3318 !C18 !C183 !CCAT !GCAT !GPOL !GVIO The Argentine government's plans to privatize the giant Yacryeta hydroelectric dam faced roadblocks Monday as opposition party protesters stormed the site and ruling party officials forecast delays in Congress. Led by their president Rodolfo Terragno, a group of 500 Radicals pushed aside truncheon-bearing but heavily outnumbered police and advanced into the $8 billion dam site on the northern Argentina border with Paraguay. While the privatization plan has aroused the antagonism of the Radicals -- Argentina's biggest opposition party -- it was also generating controversy among members of the governing Peronist Party in Congress. A group of about 20 Peronist deputies from northern Argentina were drawing up proposed modifications to the dam privatization bill. Party officials said they were pessimistic about the bill's chances for rapid passage. To help narrow the budget deficit, the government is hoping to garner over $1 billion from the Yacyreta sale. A bill to privatize the dam passed from the Senate to the Chamber of Deputies in mid-August, but it looks set to receive fiercer scrutiny in the lower house. "The feeling in the Chamber is that this isn't going to pass this year," said legislator Emilio Martinez, one of the group of northern Peronist deputies opposed to the current privatization plans. Martinez told Reuters that if the law is not passed this year then a protocol signed by Argentina and Paraguay for the privatization will expire, meaning still further delays. "We will have to start from scratch," he said. But he added, "It is more prudent to postpone the debate than discuss the bill as it is now." Martinez said he and his allies were concerned that private buyers of Yacyreta may opt to export energy, thus pushing up prices in Argentina's expanding domestic energy market. The northern congressmen also fear that the present form of the bill is too soft on Paraguay, which owns 50 percent of the dam. They oppose Argentina assuming $4 billion in Paraguayan debt incurred to build Yacyreta. An official at the office of Jorge Matzkin, the Peronist leader in the Chamber of Deputies, agreed that the prospects for a quick treatment of the bill are slim. "This is a pretty conflictive issue. The official lobbying still hasn't begun yet and there is already arguing," he said. The official warned that a legislative agenda weighed down by a major austerity package meant that the Yacyreta bill may not be debated for some time. "And if it isn't debated by the end of September I think it's unlikely to be passed this year." Yacyreta, whose first turbines began to generate power in late 1994, has always been controversial. Its construction costs ran vastly over budget and the dam has been blamed for the death of large numbers of fish in the Parana River. -- Buenos Aires Newsroom +541 318-0655 3319 !C12 !C18 !C181 !C183 !CCAT !GCAT !GCRIM A Venezuelan judge overturned an earlier decision to suspend the privatization of state-owned Banco de Venezuela Monday, allowing the auction to take place on Friday as planned, a top government officials said. "Let us hope that the investors have remained firm and that we really can carry out this process as planned on Friday," state Deposits Guarantee Fund President Esther de Margulis told reporters after she had been told of the judge's decision. Judge Irma Mansilla Olivio reversed her decision Friday that the bank's privatization be stopped because it was not being carried out in a transparent way. The judge overturned her ruling after receiving additional information from banking authorities, de Margulis said. The bank's sale will now go ahead as planned on Friday for a base price of $275 million. Five international groups from Colombia, Peru, Germany the United Kingdom and Spain have shown an interest in the bank. Peru's Banco de Credito and Spain's Banco Santander are thought to be among those interested. Colombia's Banco Bogota and Germany's Dresdner Bank AG are also tipped to be interested. Fogade became the sole owner of Banco de Venezuela in August 1994 when the bank fell victim to a massive financial sector crisis that swallowed over half the commercial sector. Fogade re-floated the bank which will be the first of four major banks slated for re-privatization to make it to auction. Banco de Venezuela is the country's oldest bank and currently the second largest in terms of deposits. At the end of 1995 the bank's total assets were valued at 382 billion bolivars ($1.3 billion at the exchange rate at that time). -- Ana Isabel Martinez, Caracas newsroom, 582 834405 3320 !C21 !C24 !CCAT !GCAT !GDIS !GWEA There was no immediate word Monday on possible damage to the coffee crop in Colombia's central Risaralda province, where torrential rains and gale-force winds battered a slum on the outskirts of the provincial capital over the weekend. Jaime Marulanda, assistant to the executive director of the Risaralda Coffee Growers Committee, said the storm of "unusual intensity" appeared to have been centered over the urban area of Pereira and the working-class district of Dosquebradas where at least four people were killed in flash floods Saturday night. But in terms of coffee, and the harvest that begins next month, Marulanda said no assessment of possible damages was likely before Tuesday. -- Bogota newsroom, 571 610 7944 3321 !C13 !C24 !CCAT !GCAT !GENV Chilean power company Empresa Nacional de Electricidad (Endesa) said it will go ahead with the controversial Ralco dam but will study the authorities' demands for changes to the project's environment impact study. Conama, Chile's counterpart of the EPA, rejected Saturday the report as incomplete and demanded details of plans to resettle hundreds of Indians who will be forced from their land. "Endesa is studying the terms of the letter from Conama as to the legality of the proposals it contains and will give an opportune reply," said the company in a statement. The dam, which will cost $463 million to build, will span the upper Bio Bio valley in wooded southern Chile with its lake flooding 3,500 hectares (8,650 acres) of land. Conama said Endesa's study did not include a complete description of the project, lacked an analysis of the impact of the dam on the whole Bio Bio basin and failed to provide plans to relocate 500 Pehuenche Indians whose land will be flooded. Submitting environmental impact reports is voluntary in Chile and Conama's demands for more information are not binding on Endesa, the country's largest power generator. Endesa said it plans to continue work on the dam which will have a 581 megawatt capacity and come on stream in 2002. "Endesa repeats its firm commitment to go ahead with the Ralco hydro-electric project and will continue with the activities which will allow it to come into operation in 2002 as planned," said the statement. The company has already built one dam, Pangue, further down stream on the Bio Bio. -- Margaret Orgill, Santiago newsroom, 562-699-5595x212 3322 !GCAT !GDIS At least four people were killed and scores left homeless over the weekend when torrential rains whipped by gale-force winds struck Colombia's central coffee-growing region, authorities said on Monday. A spokesman for the National Disaster Attention Office said the storm hit late on Saturday night, unleashing flash floods in the Dosquebradas district, a sprawling slum outside the city of Pereira that has long been known as one of the poorest areas in the coffee-growing region, the eje caferero. There was no immediate word on damage to the coffee crop in Risaralda, of which Pereira is the capital but 46 houses were destroyed or severely damaged by the floods. Witnesses quoted by the Caracol radio network said victims included a woman and her two young children whose house was swept off a slope and into a deep ravine. 3323 !E11 !ECAT !GCAT !GPOL The former Ecuadoran government manipulated data to show a sound economy, but it actually is in critical condition, the new Finance Minister Pablo Concha said. "The former government concealed and strategically manipulated the numbers to tell the country it was leaving behind a sound economy," he charged Sunday. "But it has left a sick country, in emergency." Concha said President Abdala Bucaram, who took office earlier this month, will deliver in the coming days a speech to the nation to inform about the "true" economic situation. He said cash deficit is running at about four percent of a Gross Domestic Product estimated at $17.9 billion. -- Gustavo Oviedo, Quito Newsroom, 5932 258433 3324 !C12 !C18 !C183 !CCAT !GCAT !GCRIM A final decision is expected Monday as to whether the slated sale of Banco de Venezuela will go ahead Friday after a Venezuelan judge ordered the process temporarily stopped late last week, leading local daily El Universal reported. On Friday Judge Irma Mansilla Olivio ordered state deposits guarantee fund (Fogade), the government entity in charge of the privatization, to halt the Bank's sale until charges the privatization process had not been transparent were cleared up. Fogade President Esther de Margulis has repeatedly said the process has been transparent. Fogade expects Judge Mansilla to deliver a final decision later today, El Universal said. 3325 !E41 !ECAT !GCAT !GJOB A survey by a leading private pollster indicated Monday that unemployment in Argentina is five percentage points below official figures, at 12 percent, but the firm warned the surveys' methodologies are not comparable. The study was conducted by pollster Mora y Araujo between July 19-29 among 800 people around the country and showed that 50 percent were employed, 38 percent were not employed but were not looking for work either, and 12 percent were unemployed. The pro-government IDEC think tank, which commissioned the poll, said the results show that a large proportion of the population is employed in the "informal sector". Mora y Araujo said its poll is not comparable with the government's twice-yearly survey that in May showed 17.1 percent unemployment, because of "different methodologies." But President Carlos Menem already used the poll's figures to express confidence that unemployment in Argentina was on its way down. Menem, in Malaysia where he spent three days on an official visit, said that unemployment was dropping and cited the poll, according to the daily El Cronista. -- Daniel Helft, Buenos Aires Newsroom + 541 318 0663 3326 !GCAT !GCRIM !GVIO A Dutch couple who manage a farm in northern Costa Rica have been kidnapped by an unidentified group demanding $1.5 million in ransom, authorities said on Monday. Officials said Humberto Hueite Zyrecha and his wife Jetty Kors, both 50, were kidnapped late Saturday or early Sunday. Col. Misael Valerio, head of border police at the Security Ministry, told reporters that surveillance of the country's northern border with Nicaragua has been stepped up to stop the kidnappers from fleeing Costa Rica. No other details were immediately available. 3327 !GCAT These are the highlights of the main Sao Paulo and Rio de Janeiro newspapers this morning. GAZETA MERCANTIL -- CAIXA FEDERAL, TREASURY DISPUTE FCVS DEBT A dispute between federal bank Caixa Economica and the National Treasury over who should claim 2.5 billion reais in old housing debt has slowed plans to securitize some 50 billion reais in mortgage debt in the FCVS fund. -- CARDOSO TO MEET WITH HASHIMOTO TODAY President Fernando Henrique Cardoso will meet with Japanese Prime Minister Ryutaro Hashimoto to discuss Brazil's controversial auto import regime. -- BANKS HAVE DIFFICULT FIRST HALF The release of first-half earnings for Brazilian banks shows it is difficult to generalize about the overall performance of the sector. - - - O GLOBO -- ECONOMIST KILLED BY STRAY BULLET IN SAO PAULO An economist was killed by a stray bullet that was fired through his 11th floor apartment in the upper middle-class Sao Paulo neighborhood of Brooklim. -- CESAR MAIA IS TARGET OF MAYORAL CANDIDATES Rio de Janeiro Mayor Cesar Maia's spending habits have become the chief target of candidates vying for the post in upcoming elections. - - - FOLHA DE SAO PAULO -- LOW SALARIES MAKE WOMEN ATTRACTIVE JOB CANDIDATES Businesses prefer hiring women over men in Sao Paulo because they earn on average 33 percent less than men. -- THREE SUSPECTS CONFESS TO KILLING WOMAN AT BAR Three of five suspects in the highly publicized murder of a 23-year-old college student in a Sao Paulo bar have confessed to the crime. -- John Miller, Sao Paulo newsroom, 5511 232-4411 3328 !GCAT !GCRIM !GPOL !GVIO Mexican President Ernesto Zedillo said late on Sunday he was not satisfied by setbacks to the investigation of the March 1994 assassination of presidential candidate Luis Donaldo Colosio. However, Zedillo, who took Colosio's place as candidate for the ruling Institutional Revolutionary Party (PRI) and was elected president months later, promised in a television interview not to meddle in the investigation. "I have not been satisfied that two weeks ago the attorney general (Antonio Lozano) made the decision to remove the (special) prosecutor from being in charge of this matter in hopes of naming another prosecutor," Zedillo told the Televisa network. But he ruled out a greater role for himself, saying: "I don't aspire to carry out any function not given to me by the law." The former special prosecutor, Pablo Chapa Bezanilla, was dismissed after spending 18 months building an unsuccessful case against an alleged second gunman. Chapa's theory unravelled on August 7 when a judge cleared the suspect, Othon Cortes Vazquez, for lack of evidence. A new special prosecutor will have to start from scratch. So far only one man, Mario Aburto Martinez, has been convicted of killing Colosio, who almost certainly would have become president, in Mexico's worst political assassination in 50 years. Zedillo refused to comment about what he thinks happened that day. "It would be improper for me to establish any hypothesis regarding this or any other criminal case," Zedillo said. Zedillo also condemned a new, leftist rebel group named the Popular Revolutionary Army (EPR), calling their violent attacks "pathologies." The EPR, a proponent of Marxist-style "class struggle," has launched a few ambushes on army targets, inflicting a handful of casualties, including some against civilians. "Mexicans by nature are not violent. We don't believe in violence," Zedillo said. "So these violent manifestations (by the EPR) are really pathologies. It's something that doesn't correspond to the nature of the country." Instead he praised as a "magnificent example" the current peace process between the Mexican government and the unrelated Zapatista rebels in the southeastern state of Chiapas." 3329 !GCAT !GENV !GHEA !GSCI Deep in the heart of a Central American jungle, botanists have spent almost a decade hunting for elusive plants that could provide a cure for AIDS and cancer. After nine years scouring the rainforests of Belize, they have collected 3,000 plants for research. Just 15 of those may possibly provide the vital clues needed to combat two of the biggest killers of the 20th century. Even though it is a medical race against time to save millions of lives, patience is needed as U.S. scientists back in Washington sift through the mountains of evidence collected by herbologist Rosita Arvigo and her team of seven plant detectives. "We sent in 3,000 plants. About 1,000 have been tested and 10 to 15 are showing hopeful promise in the early laboratory stages," said Arvigo who runs the unique Ix Chel Farm that is named after the Mayan goddess of healing. But this pioneer of alternative medicine steadfastly refuses to name the promising plants before the research is completed. Wary of raising false hopes for patients who might try them out of sheer desperation, she said: "Most of these plants are toxic. Take too much and you would die of liver damage." Arvigo came to Belize in 1976 from Chicago because she and her husband were "looking for medical freedom, racial harmony and a year-round growing season." They carved their farm out of hillside jungle near the Guatemalan border and set up the facility devoted to researching the healing powers of tropical plants. She spent 10 years apprenticed to a locally venerated medicine man, Don Elijio Panti, absorbing how he unlocked the secrets of the jungle to heal the sick. "I asked him to teach me. He said "No'. I spent a year gaining his confidence. He finally agreed to teach me if I promised not to leave," said this soft-spoken but fiercely determined woman as she spoke lovingly of her mentor who died in April aged 103. She has a simple message to the 10,000 people who visit the centre every year and take the "medicine trail" she has created in the forest to highlight the richness of its healing powers: "Stand up for your roots because the forests of the world are worth more standing than destroyed." Arvigo points out that less than one percent of the planet's 250,000 plants have been analysed and yet they have produced 25 percent of all prescription drugs from the quinine used to combat malaria to the periwinkle flower extract used in birth control. "Why should man reinvent the wheel? Nature has the molecules. We have to find them and put them together," she said. She made a perfect medical match when meeting researcher Dr Michael Balick from New York's Botanical Gardens. It was he that provided the National Cancer Institute funds for the massive nine-year plant hunt. Both as environmentalists and medical pathfinders, the team was racing against time becaus Mayan farmers traditionally use slash-and-burn techniques to clear rainforests to grow their crops. The funds from the U.S. Congress ran out too, leaving a bitterly disappointed Arvigo who believes another 2,000 plants could be collected in Belize for possible research. The 3,000 they did find were sent to Washington where the real detective work began. "They lay out on a lab plate 100 living cancer cells in human tissue and two different HIV viruses that cause AIDS. A drop of leaf extract is put on every single cell," Arvigo explained. "They are set aside for 24 hours. The whole shelf is put into a computer and flooded with light. If there is any change, that is considered a million to one hit," she said. Arvigo, who is now researching the plants of the indigenous Garinagu people and supplying medicinal extracts for American cosmetic companies, said of her grand project: "I just wish we had more time to finish." The work was tough. Arvigo said: "You had to climb to the top of mountains and clamber through anthills. But we kept saying each time this might just be the plant. That made us work all the harder. The weight of the world is on our shoulders. It is a great responsibility." But it is a 10-15 year process bringing the plant from the jungle through the laboratory tests to success and synthesis. Patience is vital and Arvigo constantly bears in the mind the words of her mentor Don Elijio Panti: "For every ailment on earth, the spirits have provided a cure. You just have to find it." 3330 !GCAT !GDIS Fifteen people were injured when a suburban passenger train and a truck collided at a street-level rail crossing in the Australian city of Melbourne on Monday, said rail and ambulance officials. The injured, which included a pregnant woman, were taken to hospital, but were not in a serious condition, an ambulance spokesman told Reuters. A Public Transport Corporation spokesman said the train, collided with the truck loaded with concrete pylons in the north Melbourne suburb of Preston just before 8.30 a.m.. The train was derailed when a corner of the driver's compartment caught the rear of the truck, the spokesman said. The truck was overturned, spilling its load onto the crossing, and careered into the nearby Bell St Station. "Remarkably both the train driver and the truck driver were not injured," the rail spokesman said. "It had the potential to be quite a nasty accident." -- Sydney Newsroom 61-2 373-1800 3331 !GCAT (Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW The Federal Government has been forced to reconsider a controversial Budget cost-saving measure to charge entry fees for nursing homes in a bid to stem adverse public reaction, especially from the growing numbers of the aged vote. Page 3. -- Federal Government agencies will be given access to cheaper telecommunications services under an unusual plan from the Commonwealth to become a Telstra "reseller". The resale plan forms part of a broader policy which will see all Government agencies sign telecommunications agreements with Telstra. Page 5. -- Federal Treasurer Peter Costello has signalled that reform of corporate governance is a government priority. Costello says it is critical to international competitiveness that business adopt internationally acceptable standards, and improve corporate accontability. Page 3. -- Maintenance workers from ACI Packaging's glass plant at Spotswood, Victoria, will offer their employer a peace-plan to settle a seven week-old industrial dispute over retrenchments. The Australian Manufacturing Workers Union said the decision was reached unanimously over the weekend. Page 4. -- THE AUSTRALIAN According to the latest Newspoll, voters have given the Costello Budget a positive reaction with 50 per cent of voters believing it to be good for the country. Support for the Coalition has also increased three per cent, up from 47 to 50, despite the view of one in three voters that they will be worse off as a result of the Budget. Page 1. -- A submission to Foreign Affairs Minister Alexander Downer from his department has recommended that nominees for departmental senior positions sign a declaration claiming they know of no "personal or professional" factors that could count against them being appointed. Page 1. -- The New South Wales National Party has declared its intention to introduce its own legislation into Parliament in a move which threatens the delicate relationship repaired with the Liberals just this week. State National Party leader Ian Armstrong has warned the National Party will not see it necessary to obtain Liberal Party approval to introduce any new Bills. Page 3. -- Microbiologists and immunologists have warned contaminated livestock may be the source of an outbreak of a deadly antibiotic-resistant bacteria which has killed two people and infected four in the eastern States. However the claims are not conclusive and speculation remains that Vancomycin-resistant enterococcus (VRE) could originate in a patient's bowel. Page 3. -- THE SYDNEY MORNING HERALD Universities in New South Wales claim they will be forced to slash more than 6,700 student places over the next two years following the Federal Government's decision to cut funding to higher education by nearly five per cent. The cuts will fall in the post-graduate study area as the Government has been told it, cannot change the number of undergraduate places. Page 1. -- The internationally renowned Australian Council on AIDS - the Federal Government's main advisory body on HIV/AIDS - is to be axed by the Department of Human Services and Health and re-established as a body set up to advise on HIV, sexually transmitted disases and hepatitis C. The move has been defended as a push to recognise HIV/AIDS as part of the mainstream health system. Page 1. -- The Federal Government's promise to provide more jobs for young people has been threatened by Democrats youth affairs spokeswoman Senator Natasha Stott Despoja, who is opposing the proposed "youth wage" as a part of the Coalition's Workplace Relations Bill which allows reduced rates of pay for young workers and apprentices. Page 2. -- New South Wales Premier Bob Carr has called for a meeting between rugby league administrators and the government following the death of two players in separate incidents during junior league games on the weekend. Carr said he would seek changes from officals to work harder to ensure safety in the game. Page 3. -- THE AGE The AFL is in upheaval after a day of somewhat unlikely developments that saw the possible collapse of the Melbourne-Hawthorn merger through the emergence of two benefactors, including mining magnate Joseph Gutnick, and the shock resignation of the leagues chief investigator, Martin Armad. Page 1. -- According to an Age poll, most voters believe the Howard Government's first Budget is fair, and while most admit it contains broken promises, few were ready to punish the Government so early. Page 1. -- Father Frank Brennan, one of the key players in the push for Aboriginal reconciliation, has accused Prime Minister John Howard of racism, because of scepticism on behalf of Howard in regard to whether present Aboriginal leaders and ATSIC representatives fully represented indigenous views. Page 1. -- Victorian Government MPs are poised to push strongly for tougher sentencing with one MP even raising the issue of chemical castration of child-sex offenders. A cross section of MPs interviewed by the Age believed a push from the Attorney-General will meet little resistance. Page 1. -- Reuters Sydney Newsroom 61-2 373-1800 3332 !GCAT (Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW At a meeting of Ansett executives last week, chairman Ken Cowley has ordered A$150 million to be carved from the airline's A$3 billion cost base and an increase in revenue by A$140 million to A$160 million by the end of the 1997-98 year. Page 1. -- Australia's leading metal producer Comalco Ltd's first half profit has dropped to A$59.5 million from A$157.1 million last year. Plummeting copper and aluminium prices have left Comalco venerable to a full year profit beating. Page 1. -- Figures released by the Australian Bureau of Statistics reveal the nation's manufacturers have been the hardest hit by the economic slowdown. Sales for manufacturers fell by 1.4 per cent in the June quarter while sales for wholesalers turned around marginally rising by 0.9 per cent for the same period. Page 2. -- US-based Caltex Petroleum Corp has been forced to cancel its planned A$213 million sale of a 24 per cent share in Caltex Australia Ltd due to little interest from both local and overseas investors. The back-down is the second time the market has failed Caltex USA in an attempt to offload its 75 per cent holding in the Australian group. Page 19. -- Despite being taken to the edge and back, pay-TV company Australis Media Ltd is confident of the success of its A$323 million refinancing deal, despite rumours that US-based bond holders were preparing to quash the deal. Australis feels consent of the package will be obtained over the next few days. Page 19. -- THE AUSTRALIAN Foster's Brewing Group yesterday posted a full year after tax profit of A$293.7 million, which was recorded as 16 per cent lower than the previous year's A$347.4 million. Foster's performance was somewhat tainted by the mounting losses of A$17 million fro the company's Chinese operations. Page 17. -- Ansett Australia will attempt to cut A$150 million from its costs of A$2.6 billion over the next two years, in an attempt to bring the airline back into profitability. The plan could also see Ansett pull out of some unprofitable domestic routes and contract out some group services. Page 17. -- New Zealand group Brierley Investments Ltd has increased its stake in Coles Myer Ltd to 6.8 per cent from 5 per cent, flaming rumours a break-up of the retailer may be forthcoming. On Sunday, Coles chairman Nobby Clark said the retailer would be further rationalised but a break-up wasn't currently being considered. Page 17. -- The economic recovery in Japan has lead to the AMP Society - Australia's largest investor - to increase its Japanese assets by 28 per cent. Paul Edmonson of AMP Asset Management said his company was increasingly confident about Japan's economic prospects. Page 18. -- Australia's regional and State Banks are planning a new industry association to be known as the Retail Banks Association. The new group which excludes the "big four" Australian banks, will be tailored to represent the distinct interests of smaller banks. age 19. -- The APEC Energy Week conference was told yesterday the energy requirements of the Asia-Pacific region over the next decade will provide immense economic opportunities, with an estimated A$2 trillion in development funds required to generate new electricity demand and provide infrastructure for the region. Page 19. -- THE SYDNEY MORNING HERALD After reporting a two per cent increase in annual net profit Foster's Brewing Group is looking to acquire interests in both the brewing and wine sectors. The slight increase in revenue to A$293.3 million was achieved despite the huge loss in revenues during the year, due to the sale of the Group's British brewing subsidiary, Courage. Page 27. -- Caltex Petroleum Corporation has shelved plans to sell a third of its 75 per cent stake in Caltex Australia after failing to attract sufficient investor interest. CPC sale placement was pitched at A$5.04 a share or just five per cent below the market price of A$5.30. Page 27. -- Australia's peak financial planning body, the Financial Planning Association, is reeling from the shock resignation of its chief executive Jock Rankin. It is understood Rankin was unhappy with some board members, prompting the resignation after a two-and-a-half year association with the FPA. Page 29. -- After suffering a second-half loss and forecasts of further flat conditions later on this year, Elders Australia Ltd, which is currently a takeover target, has chosen not to give a final dividend to shareholders. Yesterday also announced Futuris Corp's interest in Elders rising to 49 per cent. Page 29. -- With the average Australian fixed interest specialist fund recording a 13.5 per cent return for the year, Australian fixed interest and local share funds were seen to outperform overseas equity. Commonwealth bonds outperformed semi-Government and corporat bonds. Page 29. -- Earlier 1995-1996 month gains by Spicers Paper were removed by sharply lower international paper prices, causing the company yesterday to record a 35 per cent lower net profit of $16.02 million, from only minimally higher sales of $1.05 billion. Page 30. -- THE AGE Foster's Brewing Group chief executive Ted Kunkel has confirmed the group is considering investing into further areas of brewing and wine production. Fosters posted a two per cent increase in net profit from A$287.3 million to A$293.3 million for the year to 30 June. Page C1. -- The sudden resignation of Financial Planning Association chief executive Jock Rankin has left the way open for a challenge to the board. It is believed Rankin left Australia's peak financial body after two-and-a-half years on the board as he was unhappy wth the boards structure. Page C1. -- Comalco share prices dropped 38 cents yesterday after the metals producer released its June half profit decrease from A$155.1 million to A$43.9 million. Comalco is not expecting much improvement in the group's performance for the rest of the year, with poor international copper and aluminium prices mooted. Page C1. -- David Buckingham has been appointed the new chief of the Business Council of Australia. Buckingham takes the position following a two-year stint as executive director of the Minerals Council of Australia. Page C3. -- The Sydney Futures Exchange has moved on the Australian Securities Commission concern's that methods used to calculate and settle Share Price Index futures contracts is open for manipulation. The SFE will commission a report into the matter, despite remaiing confident that manipulation doesn't occur within the Australian futures market. Page C2. -- Regional broadcaster and Seven Network affiliate Prime Television is preparing to spend A$200 million on foreign media acquisitions following a net profit increase of 13 per cent to A$13.5 million for the year to 30 June. Page C3. -- Reuters Sydney Newsroom 61-2 9373-1800 3333 !GCAT NEW ZEALAND HERALD Front Page - School gunman flees - Gunman named as man charged with fraud - Job tests spell end of compo for some Page two - Safety issue as air controllers plan walkout - Cook Islands hotel sells for nearly $2m Business - Tauranga Port benefit from sale of Forest Corp - Construction boom tipped to confirm Fletcher Building as star - Aucklanders pessimistic on housing prospects - Weak NZ market pushes Designer Textiles lower THE DOMINION Front page - Crown well poised to sell Works Corporation - Horse shootings to stop - Support for raising age for driving Page two - Time may run out for change to surcharge - National candidate to push poverty question Business - Second-tier stocks rally as leading issues peak - Port of Tauranga shows 20pc increase in earnings - Designer Textiles trims 1997 profit forecasts - Reid expects more wool, better price - Wang NZ wins $1.5m contract THE PRESS Front page - Rising tide of youth violence in Chch - Police seek man after gun drama - Police raid Timaru gang properties Business - Log exports lift Tauranga port - July trade deficit first for the year - Comalco slides on result - Reid Farmers hurt by wool slump - Big spending ahead, says Mainpower engineer Sport - All Blacks bask in afterglow - Nash, softly softly on comeback trail 3334 !GCAT **BIRTHDAYS** Queensland Premier Sir CHARLES LILLEY was born in 1827. He was the member for Fortitude Valley and was nicknamed "Lilley of the Valley". Polish-born co-founder of MGM, SAM GOLDWYN, was born in 1882. His films included "Wuthering Heights", "Guys And Dolls" and "Porgy And Bess". The American President LYNDON BAINES JOHNSON was born in 1908. He took over the presidency after JOHN F.KENNEDY was assassinated. Australian cricketer Sir DONALD GEORGE BRADMAN was born in 1908 at Cootamundra in New South Wales. He is affectionately known as "The Don". He scored his first century when he was 12 at Bowral High School. BRADMAN is considered the greatest batsman ever, with a top first class score of 452 not out, 29 test centuries, 6,996 test runs and an overall 28,067 runs in his career. Mother TERESA of Calcutta was born in 1910. The Albanian-born missionary has dedicated her life to helping the poor and sick. She was awarded the Nobel Peace Prize in 1979. Australian author DAVID ROWBOTHAM was born in 1924. American musician and pop composer DARYL DRAGON was born in 1942. He was an accompanist with The Beach Boys but is best known as "The Captain" from The Captain and Tenille. British bass player GLENN MATLOCK was born in 1956. He played with the Sex Pistols until he was thrown out in 1977. He was replaced by SID VICIOUS. After that GLENN formed the Rich Kids and then the Spectators. German golfer BERNHARD LANGER was born in 1957. **EVENTS** 1859 : The world's first commercially productive oil well was drilled in Pennsylvania. 1883 : The Indonesian volcano of Krakatoa erupted with such intensity that the blast was heard 3,540 km away in Australia. Gigantic tidal waves devastated the coastal towns of Java and Sumatra killing an estimated 36,000 people. Debris was tossed 80 kilomtres into the atmosphere, blotting out the sun and plunging the area into darkness. The island volcano in the Sunda Straits collpased and sank below the sea. 1902 : The New South Wales Parliament passed legislation allowing women the right to vote. 1910 : Talking motion pictures, known as the "talkies", were demonstrated for the first time by THOMAS EDISON at his New Jersey laboratory. He used a device which was part camera and part phongraph, enabling the recording of sound and pictures simultaneously. 1919 : South Africa's first prime minister LOUIS BOTHA died. 1928 : The Kellogg-Briand pact was signed in Paris. The pact, named for U.S. Secretary of State Frank Kellogg and French Foreign Minister Aristide Briand, sought to outlaw war as an instrument of national policy. 1936 : Egypt and Britain signed a treaty providing for withdrawal of British forces except in the Suez Canal area. 1939 : The world's first jet-propelled aeroplane, the Heinkel 178, made its first flight at Marienehe, north Germany. 1962 : The U.S. spacecraft Mariner II was launched towards Venus. 1958 : A ticker-tape parade was held in New York for the crew of the nuclear submarine "Nautilus". The sub had completed its first epic undersea voyage across the North Pole, beneath the ice-cap. The polar voyage set a new maritime record and also raised the possibility of opening up the Arctic for the launching of guided missiles from submarines. The submarine began its historic trip from Pearl Harbour and headed north through the Bering Strait. It dived under the Polar ice-cap off Alaska and continued north under the pole. The trip across the pole took four days. 1967 : The man who brought the Beatles to prominence, BRIAN EPSTEIN, died of a drug overdose. He discovered the "Fab Four" in Liverpool's Cavern Club in 1961. 1979 : Lord LOUIS MOUNTBATTEN was murdered by the IRA. The 79-year-old former admiral and viceroy of India was killed when a bomb exploded on his fishing boat in Mullaghmore harbour in the Irish Republic. Lord MOUNTABTTEN's 14-year-old grandson NICHOLAS KNATCHBULL, local boy PAUL MAXWELL, 17, and Lady BRABOURNE were also killed in the blast. Later, the IRA killed 18 British soldiers at Warrenpoint in Northern Ireland. 1987 : An American jet pilot aborted a coast-to-coast flight because of the amorous acts of honeymooners on board the aircraft. 1995 : Peace between Israel and the PLO moved a step forward when the two sides signed an agreement in Cairo giving Palestinians more administrative powers in the West Bank. (Compiled from ABC ARCHIVES, ABC RADIO NATIONAL, "On This Day" published by REED INTERNATIONAL BOOKS LIMITED, "The Chronicle Of The 20th Century" published by PENGUIN BOOKS and "Rock And Pop (Day By Day)" published by BLANDFORD BOOKS) -- Reuters Sydney Newsroom 61-2 9373-1800 3335 !C21 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Australia's passenger and freight rail links will be hit by a 24 hour strike this week in a growing row between the Public Transport Union (PTU) and the federal government over the future of Australian National. PTU official John Crossing told Reuters on Monday the strike, on a day yet to be publicly announced, would affect freight operations across Australia, including private operations run by TNT and Specialised Container Traffic (SPT). It would also stop the operation of the Overland passenger service between Adelaide and Melbourne, and may disrupt services on the transcontinuental Sydney to Perth Indian Pacific and the Adelaide to Alice Springs Ghan lines, he said. Crossing said Canberra had failed continually to respond to workers' concerns about the future of AN, the troubled federal government-owned service in South Australia, Tasmania and the Northern Territory which has debts of A$800 million. The union has called on the government to release a report on AN and consult on overall rail industry and land transport matters, amid speculation parts of AN, including the Indian Pacific and the Ghan, could be privatised or closed down. The union also wants talks on the future of the National Rail Corp, which runs interstate freight services. "There has been absolutely not one iota of communique out of Canberra (in response to union concerns)," Crossing said. "(The stoppage) is really drawing a line in the sand and saying enough is enough, we want to be consulted," he said. "It will affect all of AN's operations: workshops, infrastructure and rail operations, have some effect on National Rail Corp and other freight forwarders, and (cause) some disruptions to interstate passenger operations," Crossing said. He said the stoppage would involve 2,600 South Australian employees of AN, with the union's Tasmanian branch expected to make a decision on action on Tuesday. AN's intrastate freight services primarily carry grain and coal in South Australia and bulk products, including chemicals and paper pulp, in Tasmania. -- Sydney Newsroom 61-2 373-1800 3336 !E21 !E211 !ECAT !GCAT !GPOL Most voters believed the Australian budget delivered last week would be good for the economy, a view which has boosted support for the Liberal-National coalition government, an opinion poll published in The Australian newspaper on Tuesday showed. The poll of 1,158 people taken last weekend found a total 59 percent believed the budget would be good for the economy while 22 percent believed it would be bad for the economy. A concurrent poll of voting intentions found that support for the coalition rose to 50 percent from 47 percent two weeks earlier and support for Labor was steady on 38 percent. The Australian said the poll results after the budget, which contained deficit cutting measures totalling A$3.9 billion, were the best since the Labor government budget of 1987. Then 61 percent believed the budget was good for the economy while 12 percent believed it would be bad. The poll taken last weekend found, however, that more people believed they would be worse off personally because of the budget. The poll found a total 38 percent said they would be worse off, while a total 17 percent said they would be better off and 35 percent said they would be neither better or worse off. The poll of political support, which surveyed primary voting intentions, also found support for the other parties like the Democrats and the Greens fell to 12 percent from 15 percent. The Democrats and Greens have said they oppose some of the budget cuts and may vote against them in the upper house, the senate. The measures in the budget cutting university funding, aboriginal funding and jobless programmes met widespread protest in the days and weeks before the budget as they were progressively revealed. The government said the budget cuts were crucial to long term hopes of lifting national savings, increasing economic growth and evenutally cutting unemployment and interest rates. The Newspoll in The Australian shows the budget also appeared to boost Prime Minister John Howard's personal ratings. Howard's rating as preferred prime minister rose to 53 percent from 51 percent two weeks earlier while Labor Opposition Leader Kim Beazley's rating fell to 24 percent from 26 percent. Those satisfied with Howard's performance rose to 51 percent from 48 percent while those satisfied with Beazley's performance fell to 42 percent from 46 percent. A similar poll taken by AGB McNair last weekend found 54 percent thought the budget was fair while 32 percent thought it was not fair. The poll of 2,057 people found 47 percent were either satisfied or very satisfied with the budget while 29 percent were either dissatisfied or very dissatisfied with the budget. The poll, published in The Sydney Morning Herald newspaper, also found that 50 percent said it would not influence their vote while 22 percent said it would make them more likely to vote Labor and 17 percent said it made them more likely to vote for the coalition. The AGB McNair poll also found 65 percent believed it broke election promises while 22 percent believed it did not break promises and 14 percent had no opinion. It also found that 56 percent approved the sharp cuts announced to Aboriginal funding while 34 percent did not approve. The next election is not scheduled until 1999, but there is a possibility the government could call an election before then, particularly if its legislation to sell a third of telecommunications company Telstra and reform the industrial relations laws are blocked again in the senate. -- Sydney Newsroom 61-2 373-1800 3337 !GCAT !GCRIM A gunman being hunted on Auckland's North Shore was captured by police just after 9 a.m. on Tuesday, New Zealand Press Association reported. Senior Sergeant Dave Pearson of Auckland police said John Grant Fagan was in police custody, but further details of his capture would not be released until a press conference later in the day. Fagan had earlier telephoned an Auckland radio station in a distraught state, saying he feared for his life. Police said he did not have a weapon when taken into custody and was now cooperating with them. Radio New Zealand reported earlier that an armed man on Monday entered the Northcote College swimming pool changing sheds and confronted a 16-year-old schoolgirl. A shot was fired, but onlookers managed to disarm the man. -- Wellington newsroom 64 4 473-4746 3338 !E21 !E211 !ECAT !GCAT !GPOL !GVOTE New Zealand First leader Winston Peters said legislation to raise the threshold for the the superannuation surcharge would not get through on Tuesday but denied his party was using delaying tactics. Today is the final day parliament is scheduled to sit before the general election on October 12, and the surtax bill is the final piece of legislation the government hopes to pass. The bill increases the thresholds for the surcharge from April 1, 1997 so the cut-in point occurs when a couple's gross income is about 10 percent above the average ordinary time wage. The new thresholds will be $15,444 a year of other income for couples ($6,825 previously) and $10,296 a year for single superannuitants ($4,550 previously). The government estimates the change will reduce the number paying the surcharge by more than 100,000 or from 25 percent to 14 percent of all superannuitants. The New Zealand First party started a series of procedural tactics last week to delay the process, and is threatening to continue to frustrate the government's attempts today to push the legislation through. Peters told Radio New Zealand that parliament was originally scheduled to sit for the rest of the week rather than rise today. "This house was scheduled to sit all of this week, excepting they thought they would shoot through, and betray the elderly one more time," he said. "They are trying to curtail the debate on this issue because they're embarrassed, and they should be...I don't think that a few MPs being put out compensates 530,000 superannuitants who have waited 11 years for a bit of justice." Peters denied suggestions his party was using delaying tactics. "It's not delaying tactics. There is a debate down and we are going to use the full ambit and time of that debate. "If those people who have claimed, and are claiming as we speak, around the hustings that they are against the surtax are forced to have their say, then it might go on for quite some time," he said. The surtax bill was tabled in parliament by Revenue Minister Peter Dunne. If passed in time, the new surcharge level could be law in time for next year's April 1 start date. The government has said it is confident the legislation will be passed before the election. "They will get it through but not today," Peters said. -- Wellington Newsroom (64 4) 4734746 3339 !GCAT !GCRIM Auckland police were seeking an escaped gunman on Tuesday after an incident in which he fired at a 16-year-old schoolgirl, Radio New Zealand said. The man entered the Northcote College swimming pool changing sheds on Monday and told the girl and a friend: "You're for it now." A shot was fired, but onlookers managed to seize the gun, the radio said. Police, who were unsuccessful in finding the man overnight, described him as disturbed and dangerous. -- Wellington newsroom 64 4 473-4746 3340 !GCAT NIHON KEIZAI SHIMBUN Two major semiconductor production equipment makers -- Tokyo Electron Ltd and Nikon Corp -- are expected to see their parent current profits fall by around 10 percent in the year ending next March 31. This is due to chip makers slashing capital spending. ---- Yasuda Fire & Marine Insurance Co Ltd plans to purchase within two years a majority stake in INA Life Insurance Co Ltd, a Japanese unit of the largest U.S. life insurance company, Cigna Corp. ---- Mitsubishi Motors Corp plans to manufacture engines and transmissions for passenger cars in China, in cooperation with Mitsubishi Corp, an investment company affiliated with the Malaysian government and Chinese companies. The joint firm will be owned 51 percent by Chinese companies, 25 percent by Mitsubishi, 14.7 percent by the Malaysian company and 9.3 percent by Mitsubishi Corp. ---- Japanese computer makers are targeting the U.S. market for personal computers servers. Fujitsu Ltd and Hitachi Ltd will start shipping servers to the U.S. market this year. NEC Corp plans to manufacture servers at its U.S. plant. ---- NTT Data Communications System Corp plans to start an information network service for banking on-line business in June next year. 3341 !GCAT !GCRIM !GPOL !GVIO The leader of a dissident Khmer Rouge faction, sentenced to death in absentia for his role in the death of more than a million Cambodians in the 1970s, has denied involvement in genocide, a newspaper reported on Monday. Ieng Sary, viewed as the former number two to the Khmer Rouge's paramount leader Pol Pot, told the Bangkok Post he was often in conflict with Pol Pot over the party line and was no mass murderer. More than a million Cambodians were executed or died of starvation, disease or overwork in camps during the Maoist organisation's "killing fields" reign of terror from 1975-79. Ieng Sary said he was implicated in the genocide only because Pol Pot had appointed him foreign minister. The newspaper said the interview was conducted at an unidentified village on the Thai-Cambodia border. He said his job kept him away from decision-making but had made him an unwitting public figure of the Khmer Rouge. "At this point, one is entitled to ask this question: 'Wasn't this a tactic by Pol Pot to make his most prominent critic take all the blame for the reign of terror?'" he said. "So it seems that the mass media have made a gross mistake by giving Ieng Sary the title of 'Brother Number Two' and 'Pol Pot's right hand'," he said in the first interview since he and a group of dissident Khmer Rouge split from Pol Pot this month. But Cambodian First Prime Minister Prince Norodom Ranariddh, speaking to reporters in Phnom Penh, was sceptical. "I think, if I am Ieng Sary I would have to say what he said," Ranriddh said. "It appears that Mr Pol Pot and Ieng Sary all together were responsible for the killings. Yes, this is well known." Despite his doubts, Ranariddh said he would support an amnesty for Ieng Sary and the members of his dissident faction if the national assembly decided to grant one. The faction has opened talks with the government since breaking away from Pol Pot. Since the split became known, there has been speculation about the fate of Ieng Sary if a peace deal with the government is struck. Ranariddh's co-premier, Hun Sen, said initially he would guarantee Ieng Sary's safety but later said the decision on a pardon should be made by parliament and King Norodom Sihanouk. King Sihanouk said at the weekend that he agreed with a proposal that he grant a mass amnesty on his 74th birthday on October 31, fuelling speculation that Ieng Sary may be pardoned. Last week Ranariddh said parliament had been asked to consider scrapping a 1994 law banning the Khmer Rouge. Some political sources in Phnom Penh said there might be some truth to Ieng Sary's claim that, as foreign minister, he was not directly involved in the running of Khmer Rouge labour camps. "It could be true. He was foreign minister and as foreign minister he could not go around and kill that many people," said one government official who declined to be identified. Others said the priority was peace and nothing should be done to discourage more Khmer Rouge fighters breaking away from their hardline leaders. The Khmer Rouge rejected 1993 elections run by the United Nations and has since waged a low-level guerrilla war from its remote forests and mountain bases. 3342 !C12 !CCAT !GCAT !GCRIM !GPOL A South Korean court sentenced former president Chun Doo Hwan to death on Monday on charges of masterminding a 1979 coup and an army massacre of pro-democracy demonstrators the following year. Under Korean law, execution is carried out by hanging. His presidential successor, Roh Tae-woo, was sentenced to 22-1/2 years in prison for playing a supporting role. Grim-faced and dressed in blue cotton prison pyjamas, both were also convicted of massive corruption during their tenures that spanned 13 years and ended in 1993. Many Koreans believe current President Kim Young-sam will offer the former generals a pardon. Separately, nine business tycoons -- including the chairmen of Samsung and Daewo -- were sentenced for bribing Roh. All got jail terms but the sentence on the Samsung chairman was suspended, meaning he will not serve time. In all 13 former military colleagues of Chun and Roh were handed jail sentences of four to 10 years in what was dubbed the "trial of the century" that dug up many of the dirtiest secrets from South Korea's era of strongman rule. Nine one-time aides bodyguards received jail terms on various charges of bribery, including acting as bagmen for their presidential bosses. The army massacre in the southern city of Kwangju killed about 200 civilians by official count and crushed democratic opposition to Chun's martial law rule. Chun and Roh are expected to appeal against the sentences handed down by the Seoul District Criminal Court. "I have a heavy heart," senior judge Kim Young-il told a news conference after the trial. Yonhap news agency quoted presidential aides as saying it would be absurd to comment on the possibility of amnesty before the cases were reviewed by higher courts. The investigation against Chun and Roh turned Korean business and politics upside down and was spurred by president Kim's campaign to "right the wrongs of history". Women relatives of the Kwangju victims, dressed in traditional mourning white, attacked Roh's son, Jae-hun, as he left the court and shouted "Kill the murderer's son". Earlier they cheered news of the death sentence, but some burst into tears when they heard Roh had escaped death. The three-judge panel said Roh was spared in recognition of his role in gaining South Korea entry into the United Nations in 1991 and other diplomatic achievements. Chun was fined 225.9 billion won ($276 million) and Roh 283.8 billion won, equal to the amount they were convicted of illegally pocketing. Roh had confessed to amassing a 500 billion won slush fund while in office. Chun was accused of building a secret 700 billion won fortune. Chun's rise to power came "through illegal means which inflicted enormous damage on the people", according to the judges' verdict. Referring to the massacre, they accused the defendants of "putting down popular resistance to clear the way for their rise to power". Chun and Roh remained defiant throughout the trial, defending the coup as necessary to prevent turmoil following the assassination of President Park Chung-hee. Samsung chairman Lee Kun-hee, who heads South Korea's largest industrial conglomerate, was sentenced to two years in jail suspended for three years. Chairman Kim Woo-choong of Daewoo, a top-four group, was given a two-year jail term without suspension. Also jailed, for 2-1/2 years, was the head of Dong-Ah group, Choi Won-suk, whose company has massive construction projects in the Middle East and Libya. All the businessmen have seven days to appeal during which time they will remain free. Their sentences sent shockwaves through Seoul's corporate boardooms, but analysts said the moguls were unlikely to spend time behind bars. Putting them in jail would be too great a blow for an economy dominated by family-owned conglomerates, some run almost single-handedly by ageing patriarchs, the analysts said. "I believe the president will pardon them," said Dongbang Peregrine's head of research Rhee Namuh. "They represent too big a part of the economy." Ordinary Koreans reacted to the former presidents' sentences a mixture of relief and anger. "I'm very ashamed to live in this country where a former president is sentenced to death and imprisoned," said Lee Jong-im, 37, a housewife and mother of two children. "I don't know how to teach our children in the future." 3343 !GCAT !GDEF !GDIP Taiwan on Monday played down a Japanese newspaper report that China's army would hold military drills involving 100,000 "rapid response" troops across southern China in October and November. "So far there has been no information saying mainland China's troops plan to move in large scale," state-funded radio quoted a policymaking official at the cabinet's Mainland Affairs Council as saying. It did not give the official's name. Japan's Yomiuri Shimbun said from Hong Kong on Sunday the war games would prepare crack People's Liberation Army units from five of China's seven military regions for emergencies in areas including, but not limited, to the Taiwan strait. China has considered Taiwan as a rebel province since a civil war separated them in 1949 and has vowed to invade if the island drops its reunification stance and seeks independence. The Taiwan official said experience showed the island's intelligence would receive sufficient notice of any threatening troop movements on the communist mainland. "We should not worry too much if the exercise does not aim at Taiwan," the official was quoted as saying. "It will take at least one or two weeks even for communist China's best troops to get to their (combat) position. The time period is enough for us to monitor their movements." Taiwan's hypersensitive stock market was indifferent to the report, edging slightly higher on Monday in calm trading. The Japanese daily said that unlike war games China held in March during Taiwan's presidential campaign, the autumn exercise would not include missile firings or mock attempts to capture Taiwanese-held islands. The report, citing "multiple Chinese military sources", said China's strategists believed exercises confined to the mainland would not draw international criticism or U.S. intervention. It said a conflict on the Korean peninsula was among the contingencies the Chinese exercises would prepare for. China's March war games in waters off Taiwan drew strong international rebuke and prompted the United States to assemble its largest armada in Asia since the Vietnam War. Beijing has acknowledged that a half-year series of war games leading up to those in March were mounted to intimidate Taiwan people who might be warming to proposals for the island's emergence as an independence country. China's many rounds of military manoeuvres were triggered in mid-1995 by President Lee Teng-hui's private visit to the United States, which was seen by Beijing as a move to promote Taiwan independence. 3344 !C12 !CCAT !GCAT !GCRIM !GDIP Five-nation wrangling over who should investigate an apparent mutiny on a fishing boat in the South Pacific on Monday delayed details of the deaths of the South Korean captain and 10 crewmen. The case involves Japan, which sent a coastguard vessel to the rescue, South Korea and Indonesia, whose seamen were killed, Honduras where the boat was registered, and interests in Oman which owned the ship. "We're still in the process of negotiating with related organisations, since our agency has no authority to investigate what apparently happened in international waters," said a spokesman for Japan's Maritime Safety Agency. A Foreign Ministry spokesman said that so far South Korea was the only one of the countries to formally ask to take over the investigation because most victims were its nationals. Police in South Korea say the 11 dead from the 250-gross ton Pescarmar No. 15 were killed in an apparent mutiny weeks ago by Chinese-Korean crewmen fed up with the ship's harsh conditions. The apparent mutiny happened between when radio contact with the ship was lost on August 3 and its rescue on Sunday. Korean police say the victims were thrown overboard but it was not known if they had already been killed, and if so how, before being pushed off the ship. A Japanese coastguard vessel, which went to the vessel's rescue after being alerted by another ship that it was drifting, found the Pescarmar No. 15 without fuel near Torishima island, about 550 km (340 miles) south of Tokyo, on Sunday. The coastguard delayed towing the ship to port until a decision on which country would exercise jurisdiction. "With someone apparently dead on the vessel, we can't tow the ship anywhere until someone first conducts an investigation," the agency spokesman told Reuters. Six Chinese-Koreans, six Indonesians and one Korean found on the vessel have been questioned by the coastguard since Sunday but they have given conflicting versions of the incident. They agree only that seven Koreans including Captain Choi Ki-taek, three Indonesians and one Chinese-Korean died as the tuna fishing vessel sailed towards the island of Samoa. The agency spokesman said one of four Indonesians earlier reported killed was found to have switched to another boat before the mutiny, making the total number of victims 11, contrary to earlier reports of 12 killed. Legal experts said as the incident occured in international waters, the authority to investigate would normally lie with the flag state, in this case Honduras. But the issue is complex as the ship is managed by South Korean fishing company, Daehyun, and owned by Omani interests. A South Korean diplomat visited Japan's Foreign Ministry on Monday to ask Japan to hand over the vessel and the remaining crew, a spokesman for the Foreign Ministry said. A South Korean Embassy spokesman told Reuters:"The negotiations are probably going to take some time, since so many countries are involved." The embassy spokesman said Oman would probably not be involved in talks as Omani ownership was purely a technical matter and actual operations were in the hands of South Koreans. The coastguard may have to rescue the ship if it starts to sink or one of the crew becomes sick, the Maritime Safety Agency spokesman said. "But as of now, we haven't received such reports and all we can do is provide the vessel with fuel," he said. 3345 !C12 !CCAT !GCAT !GCRIM !GPOL Disgraced former South Korean president Chun Doo Hwan and his successor, Roh Tae-woo, arrived in court on Monday to be sentenced for their roles in the 1979 coup and the army massacre the following year. A three-judge panel will also rule on charges they engaged in massive corruption. Enraged Koreans have heard evidence that sackloads of cash were delivered to the presidential Blue House by leading tycoons. Prosecutors have demanded death for Chun and life in jail for Roh as punishment for leading the coup and for the parts they played in the massacre in the southern city of Kwangju. Official accounts say several hundred Kwanju residents were shot and boyonetted to death by crack paratroopers who put down the uprising against martial law. The grim-faced former generals were wearing short-sleeved prison-issued shirts when they arrived at the Seoul District Criminal Court. They were greeted by television cameras and a mob of reporters as they stepped off jail buses in the latest drama in what has been dubbed South Korea's "trial of the century". Outside the court, several dozen women relatives of the Kwangju victims, dressed in traditional mourning white, staged a noisy demonstration in light rain to demand maximum punishment. "No mercy for the murderers," they screamed. The judges were expected to uphold the prosecution's sentencing demand, but most Koreans think Chun and Roh will be granted a pardon before current President Kim Young-sam leaves office at the end of next year. They are expected to appeal Monday's verdict. The two have remained defiant throughout their trial, defending the coup as needed to prevent turmoil and North Korean attack following the assassination of president Park Chung-hee. The lengthy trial that dug up many of the dirtiest secrets of South Korea's former military strongmen is part of President Kim's drive to "right the wrongs of history." Roh, the suave, former statesman who presided triumphantly over the 1988 Seoul Olympics, and Chun gave little away under cross examination, frequently saying "I don't know" or "I can't remember." Roh has confessed to amassing a 500-billion-won ($600-million) slush fund during his 1988-93 term of office, while prosecutors allege Chun built a hidden fortune of 700 billion won ($850 million) during his 1980-88 tenure. The judges also will sentence 14 former military cronies of Chun and Roh during a morning session. Later, nine top South Korean business moguls, including the chairmen of the Samsung and Daewoo groups, will be sentenced on charges of bribing the former presidents in return for business favours. They admit making payoffs, but insist they were not for business contracts. Most Koreans think the tycoons will get off lightly because of their key role in the economy. Cameras will be removed from the court during their sentencing in a move commentators say is to protect their overseas' corporate image. 3346 !C13 !CCAT !GCAT !GHEA Asia, home to some of the world's heaviest smokers, is attempting to stamp out the habit by introducing new rules similar to those recently announced in the United States targetting young people. A ban on tobacco advertising is being sought in China by 2000, an Australian state is set to fight under-age smoking with new laws while Singapore occasionaly rounds up underage smokers. Japan is beginning to acknowledge non-smokers' rights but smokers in Indian continue to puff away. President Bill Clinton, expanding the federal role in fighting teen smoking, on Friday took on powerful U.S. tobacco interests and announced strict rules to control tobacco sales and advertising -- including proof of age to buy cigarettes. Under the new rules, vending machines that sell cigarettes would be banned from places teenagers can go, and billboards advertising cigarettes would be prohibited within 1,000 feet (300 metres) of schools and playgrounds. Sales or giveaways of products like caps or gym bags that carry cigarette or smokeless tobacco product brand names or logos would also be prohibited. China recently mounted a drive to curb the growth of its 300 million-strong army of smokers, estimated to be expanding by two percent a year, but health campaigners say the importance of tobacco tax revenues makes progress difficult. In January this year, health officials launched a campaign to ban tobacco advertising by 2000. A law launched in February 1995 banned tobacco advertising in many public places, including sports stadiums, but cigarette company sponsorship of sporting events has survived the advertising law. By May this year, 30 Chinese cities had banned smoking in public places such as hospitals, libraries and stadia, but so far the restrictions appear to have had little effect. In Beijing, the fine for people who violate the ban is just 10 yuan ($1.20) -- less than the price of a packet of foreign cigarettes -- and enforcement is the responsibility of volunteers and not the police. The environment is quite different in Singapore, however, which continues to strictly enforce some of the world's most Draconian anti-smoking legislation. The city-state launched its first anti-smoking measures in 1970 and since then has gradually toughened up the rules against the promotion and consumption of tobacco. Over the last few years it has barred smoking in government buildings, restaurants, department stores, public lifts, taxis, busses, air-conditioned offices on factory floors and even in its outdoor National Stadium. Offenders can face fines of Singapore $1,000 (US$709). Singapore bans smoking by those under 18 in public places and police have gone on several highly-publicised round-ups of teenagers smoking in parks and other youth hang-outs. Meanwhile Japan, fairly liberal in its attitude towards tobacco smoking, has only recently started to acknowledge the rights of non-smokers. About 36.3 percent of 11,256 Japanese surveyed in 1995 said they smoke. Offices, particularly in major business centres such as Tokyo, have designated separate places for smoking, and some railways have a separate smoking corner on the platforms. Australia has required health warnings on cigarette packets since 1972 and bans most forms of tobacco advertising -- print and broadcast media, cinemas, billboards and most sporting sponsorships. The minimum age varies between states from 16 to 18 but the most populus state, New South Wales, is set to introduce legislation requiring proof of age to be shown when buying tobacco from October 1. In India, tobacco advertisements are banned on state-run television and radio but not in independent media though several publications have voluntarily banned tobacco ads. Advertisers increasingly sponsor sporting events to indirectly gain more mileage in popular audio-visual media. India's biggest cigarette maker ITC Ltd sponsored this year's World Cup cricket in the subcontinent, but attracted protests. But there is no organised or commonplace social opposition to smoking in public, except often-ignored notices on railway coaches asking smokers to have concern for fellow passengers. 3347 !GCAT !GCRIM A Chinese dissident in a labour camp in the eastern Chinese city of Hangzhou has been seriously injured in a three-storey fall which police have characterised as a suicide attempt, his sister said on Monday. Chen Longde was sentenced last month to three years re-education in a labour camp for "endangering national security" by sending a petition to the Chinese parliament in May demanding the release of political prisoners. "The police rang us today and said that he jumped from the third floor in a suicide attempt," his sister Chen Xiaoying told Reuters by telephone. "They said it happened on August 17 and they only contacted us today." Re-education through labour is an administrative punishment with a maximum of three years that can be imposed by police without recourse to prosecutors or the courts. Police told Chen Xiaoying her brother had suffered broken bones in his pelvis and broken teeth. "There is no way he attempted suicide," she said. "He wouldn't do that." She said in the phone call from the police the family had repeatedly demanded to know whether or not Chen had been beaten prior to the incident, and the police official had denied it. She said the family had been given permission to visit Chen at a hospital in Hangzhou on Tuesday. Chen, aged 39, had been jailed for three years for his role in student-led democracy demonstrations centred in Beijing's Tiananmen Square which were crushed by the army on June 4, 1989. Hangzhou police could not be immediately contacted for comment. 3348 !GCAT !GCRIM A 14-year-old boy in south China kidnapped and then strangled a young neighbour in a failed bid to raise ransom money to pay gambling debts, an official newspaper said. The killer, who had run up gambling debts of 9,300 yuan ($1,120), lured a 12-year-old neighbour to a cave on the pretext of looking for old coins and then demanded money, the Guangzhou-based Yangcheng Evening news said. The older boy strangled his neighbour when payment was refused. He then wrote a ransom note to the dead boy's parents, demanding money, the paper said in an edition seen on Monday. It said the younger boy was strangled with his Young Pioneer's red scarf. The Young Pioneers are a Communist-sponsored youth organisation and the red scarf symbolises the ruling party. It gave no further details. 3349 !GCAT !GCRIM !GVIO Chinese police have arrested a man suspected of planting a bomb in a busy train station powerful enough to destroy the building, the Xian Procuratorial Daily said in an edition seen in Beijing on Monday. It said two scavengers stumbled across the home-made bomb on August 5 and alerted the police to 7.95 kg (17.5 lb) of explosives outside the busy railway station in Xian city, home to the famed Qin Dynasty (221-206 BC) terracotta warriors. Police defused the bomb that could have caused serious damage and casualties within a radius of 100 m (328 ft), or an area of 3.0 hectares (7.4 acres), it said. 3350 !GCAT !GDIP China and Malaysia both want a peaceful resolution to the dispute over the Spratly Islands in the South China Sea, Malaysian Prime Minister Mahathir Mohamad said on Monday. Mahathir said that the Spratlys, a cluster of potentially oil and mineral-rich isles, were discussed in a meeting with Chinese Premier Li Peng. "Premier Li Peng made it very clear that he wants this problem to be settled through consultation and negotiation and not through confrontation," Mahathir told reporters. He also quoted Li as saying that the Spratlys could be jointly developed. The islands, which also straddle key shipping lanes, are claimed wholly or in part by Brunei, China, Malaysia, the Philippines, Taiwan and Vietnam. Mahathir said that the dispute could be resolved by a multilateral forum. Asked whether claimant Taiwan could participate, he said that it could not join as a state, though he left the door open to some other formula if it were acceptable to Beijing. China sees Taiwan as a rebel province and views all issues regarding the island as an internal matter. "We don't dispute such a stand," Mahathir said. Mahathir, who is accompanied by delegation of Malaysian businessmen, also had comforting words for China's bid to join the World Trade Organisation, saying that he did not want to see non-trade issues brought into the debate over Beijing's membership. Western countries are pushing China to open its domestic markets before it joins, though some critics say the West may be using political differences as an excuse to block Beijing's entry. The Malaysian prime minister also met Chinese President Jiang Zemin and attended a trade conference. 3351 !GCAT !GCRIM !GPOL South Koreans reacted with a mixture of anger and grief on Monday to a court ruling handing down heavy penalties on two former presidents but many were skeptical about whether the sentences would be carried out. "I think the court has done the right thing to put history to rights by giving such heavy penalties to Mr Chun and Mr Roh," Park Dae-han, a 47-year-old businessman, told Reuters. "But I believe President Kim Young-sam's clemency for them will follow after their penalties are confirmed by the Supreme Court." Chun Doo Hwan was sentenced by the Seoul District Criminal Court to death on charges of masterminding a 1979 coup and an army massacre of pro-democracy demonstrators in the city of Kwangju the following year. Chun's successor as president and military academy classmate Roh Tae-woo was sentenced to 22-1/2 years in prison for playing a supporting role, while 13 other former military cronies of the two ex-presidents were given jail terms of four to 10 years. Chun and Roh, both retired army generals, remained defiant throughout the trial, defending the coup as needed to prevent turmoil following the assassination of president Park Chung-hee in October 1979. "I watched Mr Chun on television this morning, who expressed no repentance. It made me very angry," Lee Jong-im, 37, a housewife and mother of two children, said. "I am very ashamed to live in this country where a former president is sentenced to death. I don't know how to teach our children in the future." The rage of people from Kwangju peaked following the court's verdict. "Hand over all the slaughterers to us and we will finish them off, as they killed our children," sobbed one old woman, who said her son was shot to death by the army troops during the May 1980 Kwangju massacre. Kim Gyong-chon, from a Kwangju-based committee of relatives of the victims of the incident, said the court ruling appeared to avoid a core issue when one of the former military leaders was cleared of charges relating to Chun's grab for power. "They are murderers. How could murderers be pardoned in this way," she asked, accusing the court of giving relatively less heavy penalties to Chun's former associates. "We cannot but doubt the truth behind the court ruling." Many ageing Seoul citizens, who have been educated under strict Confucianism, which lays great emphasis on loyalty to the head of state, expressed regrets over the verdict hoping Chun could escape the hangman's noose. "I agree that those who committed such grave crimes should be punished," Kim Ok-sun, in her 70s, said. "But how people of a country could execute those, whom they had set up as presidents for many years." Chun headed the country from 1980 to 1988 and Roh from 1988 to 1993. 3352 !GCAT !GDIP !GPOL A group of pro-democracy lawmakers in Hong Kong launched a formal alliance on Monday to fight for their beliefs in the countdown to the British colony's transfer to China in mid-1997. The five co-founders insisted the new group, Frontier, was not a new political party but an alliance and dismissed fears it would split the democracy movement in the British colony. Co-founder Emily Lau, a legislator and vocal proponent of greater representation in Hong Kong, told a news conference she saw the democratic movement coming under increasing pressure in the months ahead. "We believe human rights, democracy and the rule of law issues will come under stress in the months to come, but the voices speaking out on these matters are getting weaker," Lau said. "We believe in this historical moment someone needs to stand up to tell the British government, the Chinese government, and the local and the international communities that we, the Hong Kong people, will not be silenced on these issues," she said. Frontier's launch coincided with the Liberation Day holiday -- the last time Hong Kong's liberation from the Japanese occupation will be marked by a British garrison in Hong Kong. Hong Kong reverts to China at midnight on June 30 next year, ending a century and a half of colonial rule. Lau denied Frontier would split Hong Kong's democracy movement and argued it would further unify the movement. Frontier members said they would welcome into their ranks anyone who shared their objectives. They held out an invitation to members of Hong Kong's Democratic Party, the largest and oldest political party in the territory. One of Frontier's co-founders, labour activist Lau Chin-shek, is a member of the Democratic Party. The others, labour movement activists Lee Cheuk-yan and Leung Yiu-chung and former civil servant Elizabeth Wong, are independent members of the Legislative Council. "We will, of course, cooperate with the Democratic Party," Emily Lau said. "We have marched together in many democracy protests, we will certainly march with them in the future." The Democratic Party's chairman and vice-chairman, who both accepted invitations to the inauguration, also played down the idea of a possible split in the movement. "I don't believe there will be any fundamental differences particularly in the way we vote in the Legislative Council," party chairman Martin Lee said. "That's why Lau Chin-shek is both a member of our party and of Frontier," he said. The party's deputy chairman Yeung Sum was equally positive. "We welcome the setting up of Frontier, which can help mobilise more Hong Kong people to fight for democracy," Yeung told reporters. "We are not afraid the Frontier will erode our membership because we stand for the same principles." Earlier in the day, the Commander of British Forces in Hong Kong said he hoped the remembrance ceremony for those who fell in World War Two would continue after the handover. Major-General Bryan Dutton's sentiments were echoed by many of the veterans and former prisoners of war who attended the last parade by a British garrison at the Cenotaph in the heart of Hong Kong's business district. 3353 !C33 !C331 !CCAT !GCAT !GDEF !GDIP China demanded on Monday that the United States cancel plans to sell Stinger missiles, launchers and other weapons to Taiwan to prevent "new damage" to slowly recovering Sino-U.S. relations. "We ask the U.S. side...to cancel plans to sell missiles to Taiwan to prevent creating new damage to Sino-U.S. relations," a Foreign Ministry spokesman told Reuters. Beijing has regarded Taiwan as a renegade province since the end of the civil war in 1949. It opposes the sale of weapons to the island. The United States should take Sino-U.S. relations into account and live up to its promise regarding the sale of weapons to Taiwan, the spokesman said without elaborating. Washington has agreed to reduce weapons sales to Taiwan. Rejecting a similar demand by China on August 15, the U.S. Defence Department notified Congress last Friday of plans to sell Stinger missiles, launchers and other weapons to Taiwan. U.S. officials said the weapons were defensive and the sale would not affect the basic military balance in the region. The Pentagon said Taiwan wanted to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stinger missiles, 96 jeep-like Humvee vehicles and 500 rounds of .50 calibre ammunition for an estimated $420 million. The principal contractors are the Hughes Missile Systems Co., Boeing Missile and Space Systems Co. and AM General. Such sales must be made through the U.S. Defence Department, not directly by contractors, and Congress must be notified in case it wants to veto the sale. Sino-U.S. ties have see-sawed in recent years over disputes ranging from human rights abuses and widespread copyright piracy in China to alleged nuclear proliferation by Beijing. The ties plunged to new depths over the last year in a row over a landmark trip by Taiwan's President Lee Teng-hui to the United States in June 1995. Earlier this month, Beijing warned Washington that a U.S. stopover by Taiwan's Vice-President Lien Chan could cause new damage to slowly recovering ties. However, in a sign that China was eager to prevent Lien's visit from harming slowly warming relations, Beijing refrained from further comment while Lien was in the United States. Ties between Beijing and Washington were set on better footing after a visit to Beijing by U.S. National Security Adviser Anthony Lake in July. The trip laid the groundwork for an exchange of high-level visits later in the year, with U.S. Secretary of State Warren Christopher invited to China in November and Chinese Defence Minister Chi Haotian due to go to Washington before the end of December. An exchange of visits by Chinese President Jiang Zemin and U.S. President Bill Clinton could go ahead next year, if Clinton wins re-election in November. Chinese officials have said they expect Christopher's visit, his first since a 1994 trip that stumbled badly over human rights, to go smoothly with both sides keen to remove obstacles in their relations. In a separate development that could strain Sino-U.S. ties, the Washington Post reported on Sunday that U.S. intelligence officials had concluded that Pakistan was secretly building a medium-range missile factory near Islamabad using Chinese blueprints and equipment. Asked to comment on the report, Chinese Foreign Ministry spokesman Shen Guofang said: "The report is totally groundless." 3354 !C24 !CCAT !GCAT !GDIS An explosion of an oil pipeline in central China earlier this month killed more than 40 people and injured 40, officials said on Monday. The pipeline exploded in Neihuan county between Fuyang and Tangyin in Henan province on August 9, said the officials, contacted by telephone. They added that the site was still cordoned off. "The scene of the explosion is cordoned off, so we have no idea of the damage or whether oil supplies were disrupted," an official of Neihuan county told Reuters by telephone. Fuyang is the site of the big Zhongyuan oilfield. A local newspaper reported that the explosion may have been caused by thieves who apparently drilled a hole in the pipeline to syphon off oil. Officials said the explosion was still under investigation. 3355 !GCAT !GPOL A prominent Chinese educator has said China must promote Marxist teachings to counter the adverse effects of economic reforms, an official newspaper said on Monday. Wu Shuqing, the former head of prestigious Beijing University, was quoted by the Workers' Daily as saying that the reforms had led to an influx of alternative ideologies, including non-Marxist and anti-Marxist ideologies. "Hostile Western forces are spreading anti-Marxist opinions to subvert China's socialist system. "We must keep Marxism as the guiding principle," said Wu, an economist who is now retired. Wu was named president of the university in 1989 after student led-protests were crushed by the army. Beijing University was a centre of the 1989 student movement. During Wu's tenure, Beijing University students were sent on military training. Wu stepped down earlier this year and was replaced by vice-president Chen Jiaer. Wu said paramount leader Deng Xiaoping's policy of "socialism with Chinese characteristics" was in keeping with the principles of Marxism. China has used "socialism with Chinese characteristics" to endorse many non-Marxist economic ideas. Deng Xiaoping has been the key force behind the sweeping economic reforms, begun in 1979, which have dismantled much of China's centrally planned economy and have encouraged the establishment of private firms and promoted free market principles. The reforms have eroded China's state dogma of communism, leaving an ideological vacuum that state and party leaders have been struggling to fill. 3356 !GCAT !GCRIM !GPOL !GPRO A South Korean court sentenced former presidents Chun Doo Hwan and Roh Tae-woo on Monday for their roles in a 1979 coup and massacre the following year in the city of Kwangju. Former generals were also sentenced for their parts in the putsch and killings that followed. A line-up of business tycoons were convicted of bribing Roh. The following is a chronology of major events leading up to what has been dubbed in South Korea the "trial of the century". Oct 19, 1995 - Opposition lawmaker Park Key-dong drops bombshell in parliament by saying Roh amassed 400 billion won ($492 million) while in office from 1988-93. Oct 27 - Roh tearful confesses he secretly amassed a slush fund totalling 500 billion won. Nov 1 - Prosecutors start grilling Roh, the first South Korean president, serving or retired, to face legal questions. Nov 16 - Roh is arrested and held on charges of taking bribes from business tycoons. Nov 24 - President Kim Young-sam orders his ruling party to draft a special law to punish his two predecessors for abuses. Nov 30 - Prosecutors form team to reopen investigation into a 1979 coup and 1980 army massacre of pro-democracy protesters in the southern city of Kwangju. Dec 1 - Chun rejects prosecution summons to appear for questioning and the following day heads for his hometown after holding a defiant news conference to accuse President Kim of a political witchhunt. Dec 3 - Chun is arrested on charges of masterminding the 1979 putsch and brought back to Seoul where he is detained in Anyang Prison. He begins a hunger strike. Dec 5 - Roh is charged with accepting bribes from business tycoons. Prosecutors also indict nine business tycoons but they are not detained. Dec 9 - Seoul prosecutors probe Chun's slush fund. Dec 18 - Corruption trial starts for Roh, nine business moguls and five former top officials. Dec 21 - Chun and Roh are formally indicted on mutiny charges for their major roles in the 1979 coup. Dec 29 - Chun ends fasting. Jan 12, 1996 - Chun is charged with accepting bribes. Jan 22 - Prosecutors indict Chun and Roh on treason charges over the Kwangju massacre. Feb 26 - Chun appears in court to answer bribery charges. Feb 28 - Prosecutors wind up a three-month probe into the coup and the army massacre. March 11 - Hearing begins on mutiny and treason charges against Chun and Roh. June 29 - Prosecutors demand jail sentences for nine tycoons on trial with Roh for corruption, including chairmen of Samsung and Daewoo groups, and the five former top officials. Aug 5 - Prosecutors ask court to sentence Chun to death and Roh to life in prison. Jail terms of between 10 years and life sought for the 14 former officers. Aug 26 - Seoul District Criminal Court sentences Chun to death for masterminding the coup and massacre. Roh sentenced to 22-1/2 years in prison for playing secondary role. The nine tycoons are sentenced. Samsung chairman Lee Kun-hee gets two years suspended for three years, Daewoo chairman Kim Woo-choong is given two years in jail. Of the military cronies, 13 convicted and one acquitted. The nine one-time aides and bodyguards also sentenced to jail. 3357 !GCAT !GCRIM !GDEF !GDIP Japan's Supreme Court hands down a key ruling on Wednesday in a bitter row over U.S. military bases in Okinawa, a decision that could either aggravate the issue or pave the way for a settlement. Technically, the ruling will focus on whether Okinawa Governor Masahide Ota has the right to disregard central government orders and refuse to sign documents to continue leasing private land for use by the bases. At the heart of the issue is Okinawa's historical grievance against Tokyo for leaving a lopsided concentration of U.S. military bases even after the island reverted to Japan in 1972, following 27 years of U.S. military rule from the end of World War Two. If the Supreme Court throws out the Okinawa case, Ota still has the option of continuing his campaign of disobedience against the central government, his aides say. Most experts expect the Supreme Court to uphold a decision by the Fukuoka High Court last March which ruled against Ota, saying the U.S.-Japan Security Treaty takes precedence over his domestic policies. Wednesday's ruling is on an appeal by Ota. There is a slim chance that the Supreme Court may rule against the central government -- which would question the whole legality of U.S. bases on Japanese soil. The ruling is on leases on a batch of 11 plots of land inside minor U.S. bases on Okinawa set to expire this year. Contracts for a second batch of 3,000 plots of land expire next May, including land for the key U.S. Air Force base at Kadena. Wednesday's ruling sets the stage for another unprecedented event -- a prefectural referendum in Okinawa on September 8 over a non-binding resolution to scale down, but not immediately abolish, U.S. bases there. Ota has campaigned for the withdrawal of all U.S. forces in phases by 2015. No Japanese prefecture has ever held a referendum over any issue. What triggered the row was the rape of a 12-year-old Okinawan schoolgirl in September 1995 by three U.S. servicemen, who are now serving up to 10 years in jail. The crime triggered a public outcry over the U.S. military presence in Okinawa which in turn prompted Governor Ota to launch his campaign of disobedience against Tokyo. Although it represents only one percent of Japan's population and land, Okinawa is saddled with about 75 percent of all U.S. military facilities in the country. More than half of the 47,000 U.S. military personnel in Japan are stationed in Okinawa, which is home to an entire U.S. Marine Corps division and a regional hub U.S. Air Force base. Ota says Okinawa's prime land to develop industry has been taken up by U.S. bases, not to mention the noise and other nuisances that come with any modern military presence. In court proceedings, Ota argued that Tokyo's order for him to sign land lease extensions violated the constitutional right of citizens to a peaceful livelihood and right to own property. Ota also said the lopsided presence of U.S. bases in Okinawa violated the principle of equality before the law, and that Tokyo's order had no firm basis in a specific law. The central government told the court Ota had no right to refuse the orders since the state, and not the local government, was responsible for defending its land and people. 3358 !CCAT !GCAT !GDIS The 92,800-tonne deadweight Andaman Sea, slightly damaged last week in a collision off Singapore, has delivered a cargo of Bintulu condensate to Malacca, an official with the ship's owner said on Monday. The tanker was carrying 180,000 barrels of Bintulu condensate when it hit a submerged vessel off Singapore on August 19, a management official at owner Tanker Pacific Management said. The vessel, enroute from Sarawak, east Malaysia to the refining centre of Malacca, on the west coast of peninsular Malaysia, sustained only slight damage but there was no oil leak, the official said. Repairs were carried out in Singapore. The official said the Andaman Sea made "light contact" with the 14,114 tonne deadweight Herceg Novi, which sank off Singapore waters on August 18. "I think it was the Novi," the official said, when asked if the Andaman Sea had hit the Novi. The Novi sank about three miles east of Singapore's Raffles Lighthouse. --Singapore Newsroom (+65 870 3081) 3359 !E51 !E512 !ECAT !G15 !G153 !G158 !GCAT The Asean Chambers of Commerce and Industry (Asean-CCI) has urged the European Union to defer the implementation of a new tariff scheme for agricultural products which is to take effect next year, the chamber's executive committee chairman Jose Concepcion said on Monday. "Asean-CCI expresses its strong concern over the new EU GSP for agricultural products to be effective on January 1, 1997," Concepcion said in a statement. The European Union's new generalised system of preferences (GSP) will exclude major food products. "Asean-CCI urges the EU to defer the implementation of the scheme and to consider the possibility of setting up appropriate measures to minimise the adverse impact on agricultural sector in the Asean region," he added. Asean groups the Philippines, Singapore, Indonesia, Malaysia, Thailand, Brunei, and Vietnam. - Manila newsroom 63 2 8418938 Fax 8176267 3360 !C12 !C41 !CCAT !GCAT !GCRIM !GPOL Choi Won-suk, chairman of Dong-Ah Group, has not yet decided whether to appeal the 2-1/2 year jail sentence handed to him on Monday for bribing former president Roh Tae-woo, a group spokesman said. "We are all shocked after the chairman got a jail sentence. We had expected a suspended jail sentence for him at most," the spokesman said. State prosecutors had demanded Choi be sentenced to four years in jail. 3361 !C12 !C16 !C17 !CCAT !GCAT !GCRIM A South Korean court on Monday approved an application by debt-ridden Kun Young Construction Co Ltd to go into receivership, the Korea Stock Exchange said. "All assets and debts of Kun Young were frozen after the application was approved," said an exchange official. SEOULBANK, Kun Young's primary creditor, together with other debtholders, is now expected to take over the management of the firm until a buyer is found. The company filed an application for court receivership last Tuesday. It sought protection from its creditors after running into financial trouble stemming from a slump in housing construction. Last Monday, Kun Young defaulted on 1.26 billion won worth of promissory notes. It narrowly avoided bankruptcy by paying the debt the following day. Kun Young was near an agreement last Tuesday on a takeover by a consortium led by unlisted Dongsung Construction Co Ltd. But SEOULBANK rejected the deal, casting doubt on Dongsung's ability to write off Kun Young's debts. Kun Young's current liabilities amount to 550 billion won with assets of 800 billion won. 3362 !GCAT !GDEF !GDIP China on Monday demanded the United States cancel plans to sell Stinger missiles, launchers and other weapons to Taiwan to prevent "new damage" to Sino-U.S. relations. "We ask the U.S. side...to cancel plans to sell missiles to Taiwan," a Foreign Ministry spokesman told Reuters. Cancellation of the missile sale would "prevent creating new damage to Sino-U.S. relations", the spokesman said by telephone. Beijing has regarded Taiwan as a renegade province since the end of the civil war in 1949 and has been opposed to any country selling weapons to the island. Rejecting an earlier demand by China, the U.S. Defence Department notified Congress on Friday of plans to sell Stinger missiles, launchers and other weapons to Taiwan, saying the weapons were defensive and the sale would not affect the basic military balance in the region. The Pentagon said Taiwan wanted to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stinger missiles, 96 jeep-like Humvee vehicles and 500 rounds of .50 calibre ammunition for an estimated $420 million. 3363 !GCAT !GPOL For the last time, Hong Kong's British garrison on Monday marked the liberation of the colony from Japanese rule after World War Two in a ceremony remembering the many who fought and died during the brutal occupation. Under the eyes of local veterans, some 50 men from the 1st Battalion the Royal Gurkha Rifles paraded past the Cenotaph in Hong Kong island's Central district memorializing the dead, marching to the Band of the Corps of the Royal Engineers. Following a two minute silence, Commander British Forces Major General Bryan Dutton laid a wreath at the foot of the memorial, followed by representatives of veterans, former prisoners of war and service organizations. This time next year, the British garrison and the crown colony of Hong Kong will already have been consigned to history, as the territory lowers the Union Jack at midnight, June 30, 1997, and becomes a Special Administrative Region of China. Liberation Day itself will no longer be marked on the last Monday of August as it has been since the war. Rather, the Chinese committee preparing for the transfer of sovereignty has decreed that Sino-Japan War Victory Day will be observed on the third Monday of the month. How the future People's Liberation Army (PLA) garrison in Hong Kong may wish to mark the day is not known. "This should continue after 1997," said one Hong Kong Chinese veteran at the ceremony. "The dead, they died for Hong Kong, for China." Some veterans have vowed to continue remembrances for their fallen comrades even if they have to move to a private venue, but have voiced their faith that China would give its blessing. The arrival of the PLA in Hong Kong on July 1 next year is viewed with some trepidation in the territory, a British colony for more than a century and a half. Images of the PLA's 1989 crackdown on student democracy protestors around Tiananmen Square remains etched in Hong Kong's collective memory. The PLA has been working hard to burnish its image. In a campaign to win the territory's hearts and minds, it has emphasised the high professionalism and character of the soldiers who will be stationed here. China and Britain agreed last week to talks in September to hammer out laws governing the future Chinese garrison. The Japanese invaded Hong Kong from China, crossing the border on December 8, 1941, at about the same time as the attack on Pearl Harbour on the other side of the date line. The colony held out for more than two weeks despite overwhelming odds, defended by a tiny, lightly armed garrison aided by volunteers. It fell 17 days later on Christmas Day. Thousands of British and Commonwealth prisoners of war were interned in camps on Hong Kong. Others were transported to Japan and Taiwan to become virtual slave labourers. Chinese residents suffered harsh rule, economic collapse and shortages of food and resources. The population fell from 1.6 million before the invasion to just 600,000 at liberation. Hong Kong's liberation officially falls on August 30, when the British Navy under Rear-Admiral Cecil Harcourt sailed into Victoria Harbour to accept the Japanese surrender. But the Union Jack was raised nearly two weeks earlier, just days after Tokyo's capitulation, when the internees left the camps and set up a provisional government. 3364 !CCAT !GCAT !GCRIM !GVIO A hijacked Sudan Airways plane with 199 passengers and crew on board was flying early on Tuesday towards London where its armed hijackers intend to surrender and seek political asylum, police said in Cyprus where the plane refuelled. The Airbus 310 Flight 150 was hijacked on its way from Khartoum to the Jordanian capital Amman on Monday evening and landed at Larnaca airport in Cyprus after it ran low on fuel. One hijacker was apparently armed with grenades and TNT and had threatened to blow the plane up unless it was refuelled and they were taken to London where they wanted political asylum, police spokesman Glafcos Xenos said. "They will surrender the passengers there and surrender themselves," Xenos told reporters at Larnaca airport. He said the foreign minister of Cyprus had contacted the High Commission in Nicosia to inform British authorities that the plane would fly to London's Heathrow airport. The flight was expected to take about 4-1/2 hours with the plane due to reach London at around 03.15 GMT. Cypriot authorities tried to negotiate through the pilot with one of the hijackers, asking him to release all women and children on board before refuelling. But he refused and was quoted as saying: "I will blow the plane up." The police spokesman defended the decision by Cypriot authorities to refuel the plane and let it fly to London, saying they could not risk the lives of those on board. "They ordered us to refuel the plane otherwise they were going to blow it up...They had hand grenades," Xenos said. "All possible measures were taken but the hijackers refused to negotiate. We tried our best," Xenos said. The identity and number of the hijackers was not known. One of them negotiated through the pilot in English. The pilot said several hijackers appeared to be placed around the plane. Cyprus initially refused permission for the plane to land but allowed it to touch down when the pilot said he was running out of fuel. Egypt had earlier stopped it from landing, Cypriot officials said. They sent a message to Khartoum asking for a passenger list but got no reply, police said. The plane was believed to have 186 passengers and 13 crew on board. There were no reports of injuries, Xenos said. It was the second hijacking this year involving a Sudanese airliner. On March 24, a Sudan Airways Airbus A320 plane carrying 40 passengers and crew was hijacked to Eritrea. The two Sudanese hijackers who seized the plane on an internal flight sought political asylum in Eritrea. They surrendered to Eritrean authorities on reaching Asmara, the Eritrean capital. Sudan's Islamist military government has a broad array of political opponents and is waging a bitter war against separatist rebels in the mainly Christian and animist south. The United States accuses the Khartoum government of sponsoring "state terrorism". The Sudanese army on Saturday denied an opposition report that 11 military officers were executed on charges of taking part in a conspiracy to blow up government targets in Port Sudan. But army spokesman General Mohamed Sanousi Ahmed told the Sudan News Agency (SUNA) that up to 25 people had been arrested, including 17 military men, in connection with the plot to attack vital installations in the Red Sea port and disrupt Sudan's foreign trade. 3365 !GCAT !GVIO A Sudan Airways plane with 199 passengers and crew which was hijacked to Cyprus took off from Larnaca airport after refuelling and headed to Britain early on Tuesday, witnesses said. Cypriot police said an unknown number of hijackers were on board the Airbus 310 Flight 150 which was hijacked on its way from Khartoum to Amman in Jordan on Monday evening. One was apparently armed with grenades and explosives and had threatened to blow it up unless it was refuelled and they were taken to London where they intended to surrender and seek political asylum, police spokesman Glafcos Xenos said. He said the foreign minister of Cyprus had contacted the British High Commission in Nicosia to inform British authorities that the plane would be heading to London. Police said the plane was bound for London's Heathrow airport, but other airport sources said it would fly to Stansted airport in Essex. Cypriot authorities negotiated through the pilot with one of the hijackers for him to release all women and children on board before refuelling but he refused and was quoted as saying: "I will blow the plane up." The identity of the hijackers was not known. One of them negotiated through the pilot in English, police said. The pilot said several hijackers appeared to be scattered throughout the plane. Cyprus initially refused permission for the plane to land but allowed it to touch down when the pilot said he was running out of fuel, Cypriot officials said. It was the second hijacking this year involving a Sudanese airliner. On March 24, a Sudan Airways Airbus A320 plane carrying 40 passengers and crew was hijacked to Eritrea. The two Sudanese hijackers who seized the plane on an internal flight sought political asylum in Eritrea. They surrendered to Eritrean authorities immediately after reaching Asmara, the Eritrean capital. Sudan's Islamist military government has a broad array of political opponents and is waging a bitter war against separatist rebels in the mainly Christian and animist south 3366 !GCAT !GVIO A man believed armed with grenades and explosives hijacked a Sudan Airways Airbus 310 to Cyprus on Monday night where he threatened to blow it up unless it was refuelled to fly to London, a Cypriot police spokesman said. The hijacker was believed to be armed with grenades and TNT, police spokesman Glafcos Xenos told reporters at Larnaca airport where the plane landed with 186 passengers and 13 crew after being hijacked en route from Khartoum to Amman in Jordan. It was not known if there was more than one hijacker on board but air traffic control sources said the pilot, speaking by radio, had referred to the hijackers as "they". Xenos said their identity was not known but he or they had demanded to be flown to London in order to apply for political asylum. Cypriot authorities negotiated through the pilot with one of the hijackers for him to release all women and children on board before refuelling but he refused and was quoted as saying: "I will blow the plane up." He later said he would release all passengers on arrival in London, the police spokesman said. "We are making every effort to get the passengers free," Xenos told reporters. The Airbus 310 was parked at the western edge of Larnaca's coastal airport and was ringed by police. Anti-terrorist police were arriving. Cyprus initially refused permission for the plane to land but allowed it to touch down when the pilot said he was running out of fuel, Cypriot officials said. 3367 !CCAT !GCAT !GCRIM !GVIO A Sudan Airways Airbus 310 was hijacked between Khartoum and Amman on Monday evening and landed in Cyprus for refuelling, Cypriot air traffic control sources said early on Tuesday. The sources said the hijackers -- it was not clear how many they were -- wanted to fly to London "for humanitarian reasons" or to seek political asylum in Britain. The hijackers refused a Cypriot request to allow women and children off the plane before refuelling, one air trafic control source said. Refuelling had not yet begun, he added. Michael Herodotou, director of civil aviation authority in Cyprus, said the plane was initially refused permission to land at Larnaca but was allowed to touch down when it was learned it was running out of fuel. Contact with the hijackers was being made through the pilot. Hospitals in Cyprus were on stand-by and there was tight police security at Larnaca airport. Cairo airport sources said earlier the plane was hijacked about 20 minutes after it took off from Khartoum airport. It was the second hijacking this year involving a Sudanese airliner. On March 24, a Sudan Airways Airbus A320 plane carrying 40 passengers and crew was hijacked to Eritrea. The two Sudanese hijackers who seized the plane on an internal flight sought political asylum in Eritrea. They surrendered to Eritrean authorities immediately after reaching Asmara, the Eritrean capital. 3368 !CCAT !GCAT !GVIO A Sudan Airways Airbus 310 with 186 passengers and 13 crew members on board that was hijacked between Khartoum and Amman landed at Larnaca airport in Cyprus on Monday evening for refuelling, air traffic control sources said. The sources at Larnaca airport said they did not know where the plane would fly next. Cairo traffic control sources earlier said the hijacker, a man, had originally demanded that the pilot fly to Rome. Michael Herodotou, director of civil aviation authority in Cyprus, said they understood from the pilot that the hijacker or hijackers wanted political asylum in London. He said the plane was initially refused permission to land at Larnaca but was allowed to touch down when it was learned it was running out of fuel. It was the second hijacking this year involving a Sudanese airliner. On March 24, a Sudan Airways Airbus A320 plane carrying 40 passengers and crew was hijacked to Eritrea. The two Sudanese hijackers who seized the plane on an internal flight sought political asylum in Eritrea. They surrendered to Eritrean authorities immediately after reaching Asmara, the Eritrean capital. 3369 !CCAT !GCAT !GVIO A man hijacked a Sudan Airways Airbus 310 on a Khartoum-Amman flight on Monday and the plane was heading to Larnaca airport in Cyprus where it would be allowed to refuel, Cypriot police sources said. The plane left Khartoum airport on Monday evening and the hijacker revealed himself about 20 minutes later, Cairo traffic control sources said. The captain of the plane sent out the internationally recognised hijack signal and then told the Cairo control tower that the hijacker initially demanded to fly to Rome. He later decided to make for Larnaca, which is closer, and the pilot was complying with this demand, the sources said. Israel Radio said the man wanted to fly to London. The plane is carrying 186 passengers and 13 crew, police sources said. Cypriot police sources said permission to land at Larnaca was at first rejected but then the pilot was told he could land for one hour to refuel. Emergency measures were being taken at Larnaca airport and hospitals were on standby. The identity of the hijacker was not known. 3370 !CCAT !GCAT !GVIO A man hijacked a Sudan Airways Airbus 310 on a Khartoum-Amman flight on Monday and the plane should shortly land at Larnaca in Cyprus at the request of the hijacker, Cairo air traffic sources said. The plane left Khartoum airport on Monday evening and the hijacker revealed himself about 20 minutes later, they said. The captain of the plane sent out the internationally recognised hijack signal and then told the Cairo control tower that the hijacker initially demanded to fly to Rome. He later decided to make for Larnaca, which is closer, and the pilot was complying with this demand, the sources said. The plane is carrying 186 passengers and 13 crew, the sources said. They earlier said there were 185 passengers. 3371 !GCAT !GDIP !GPOL Israeli Prime Minister Benjamin Netanyahu said on Monday he expects progress in the stalled peace process with the Palestinians "in the coming weeks". Netanyahu spoke after meeting visiting Japanese Foreign Minister Yukihiko Ikeda, who urged Israel's right-wing government to re-energise Middle East peacemaking, dangling the prospect of closer economic ties with Tokyo as a reward. "We reiterated our commitment to pursue peace, both on the Palestinian track -- in which I expect progress in the coming weeks -- and on the Syrian track, in which we reissued our invitation to Syria to resume the talks," Netanyahu told a joint news conference after the Ikeda meeting. Ikeda, speaking through an interpreter, said he was "very happy" to hear of the determination of the Netanyahu government to make progress in Israeli-PLO talks, which have been put on hold since the Likud leader defeated Nobel Peace Prize laureate Shimon Peres in May elections. "I was also left with the impression that there will be concrete progress made in the context of the Palestinian track soon," Ikeda said. Neither men specified the nature of possible movement in Israeli-PLO talks, expected to resume early next month. But Palestinians are closely watching the guarded Netanyahu for signs he will give green lights to a long-delayed army pullback from the still-occupied West Bank flashpoint of Hebron, and to a face-to-face meeting with Palestinian President Yasser Arafat. Arabs have condemned Netanyahu for rejecting Peres' formula of exchanging occupied Arab lands for peace, a principle endorsed by Israel's patron ally Washington and the basis of peace talks since 1991. The stance has prompted a total shutdown on the Syrian track, already logjammed over the Israeli-held Golan Heights. In a meeting earlier on Monday with his Israeli counterpart David Levy, Ikeda called the current Israeli-PLO peace process the "only option we have", pointedly adding: "Advancing the peace process in the region will of course bring more development of the ties between (Israel and Japan) in the spheres of the economy and culture." Netanyahu, noting that Japan is Israel's second biggest trading partner, said he expected a substantial increase in trade and joint ventures between the two nations. "We spoke about Japan's contributions to peace, both in the diplomatic field...and (its) very important and much valued contributions in the economic development of the region, which I think is a great boost for peace," Netanyahu said. Japan is the main donor nation aiding Arafat's Palestinian Authority and a participant in multilateral Middle East talks. On Sunday in self-ruled Gaza, Ikeda said he had invited Arafat to visit Japan from September 10 to 13. Ikeda, who has visited Jordan, Egypt and Syria during his tour, also traded invitations with Netanyahu. "I invited the Japanese prime minister to visit Israel," Netanyahu said. "I received an invitation to go to Japan myself, and I welcome it very much, I intend to do so." 3372 !GCAT !GVIO More than 100 people have been killed in fighting between rival Kurdish factions in northern Iraq and hundreds of families have been made homeless, a U.N. official in the region said on Monday. Poul Dahl, chief of the U.N. guards contingent in northern Iraq, told Reuters in Baghdad by telephone that Iraqi Kurdistan was "very tense" and that the clashes were likely to disrupt distribution of food and medicines in that region under Iraq's oil-for-food deal with the United Nations. Fierce fighting broke out on August 15 between guerrillas loyal to Massoud Barzani of the Kurdistan Democratic Party (KDP) and his rival Jalal Talabani, head of the Patriotic Union of Kurdistan (PUK). The United States brokered a ceasefire on Friday and persuaded the warring PUK and KDP leaders to attend peace talks next month. Britain offered to host the talks. But on Monday the KDP accused its rivals of breaking the ceasefire by launching heavy attacks at midnight Sunday. In a statement in the Turkish capital Ankara, it said 29 PUK fighters had died in the fighting on Monday. It gave no figure for its own losses. The clashes have shattered a ceasefire the two sides reached last year under U.S. auspices. Dahl said hundreds of Kurdish families, close to the Iraq- Iran border, have been displaced by the fighting and have nowhere to go. "I saw tens of rebels from both parties killed in latest clashes. There were hundreds of casualties. At least more than 100 have died so far," Dahl said. "Security is the basis of our work. Under current circumstances I think we will not be able to implement 986 in accordance with the memorandum of understanding," Dahl said, speaking from his headquarters in the Kurdish stronghold of Arbil. "There is potential risk of the situation getting out of control if it continues like this," Dahl said. Iraq's partial oil sales deal with U.N. is based on Security Council resolution 986 issued in 1995. Under the agreement, which is expected to go ahead next month, Iraq can sell oil worth $2 billion every six months to raise funds to buy food and medicines and other humanitarian needs. Of the $1.3 billion left for Iraq from the sales, some $260 million has to be spent on Kurdish areas currently outside central government control. Distribution of supplies in the Kurdish region is the United Nations' responsibility. But Dahl said not all plans had been finalised. In New York U.N. spokeswoman Sylvana Foa said: "The fighting will not delay the report" which Secretary-General Boutros Boutros-Ghali intends to present shortly on implementing the oil-for-food deal. The deal can start when all the oil monitors are in place in Iraq. Diplomats in New York said they did not expect the situation in northern Iraq to delay implementation of the oil-for-food deal in the rest of Iraq, unless Iraq's oil pipeline to Turkey was damaged in the fighting. There was no fighting in the area of the pipeline, a U.N. source said. U.S., British and French planes have been patrolling the skies of northern Iraq since shortly after the 1991 Gulf War to shield Iraq's Kurds from any attack by Iraqi troops. Dahl, a Danish army officer, heads a contingent of 127 guards who accompany U.N. relief convoys and provide information on security matters in the region. Iran's Foreign Minister Ali Akhbar Velayati, in remarks published on Monday, said only his country could bring peace to northern Iraq. On Sunday Iraq accused both Washington and Tehran of meddling in the affairs of its Kurdish minority. Deputy Prime Minister Tareq Aziz said Iran was taking sides in the Kurdish disputes, ferrying troops to the region and using artillery and rocket launchers to shell targets in northern Iraq. The KDP has accused Iran of aiding the PUK in its attacks while the PUK has accused Iraqi government forces of shelling northern Iraq. 3373 !GCAT !GDIP !GVIO U.S. Senate Intelligence Committee chairman Arlen Specter, who has questioned whether Defence Secretary William Perry should resign over the latest bombing in Saudi Arabia, met Saudi officials on Monday during a brief visit to the kingdom. A U.S. embassy spokesman in Riyadh said Specter, who arrived from neighbouring Oman on Sunday and left on Monday, had talks with Saudi and American officials in Dhahran, where 19 U.S. airmen were killed by a fuel truck bomb on June 25, and Riyadh. Specter met Crown Prince Abdullah and Minister of Defence and Aviation Prince Sultan in Jeddah, Saudi state television and the official Saudi Press Agency reported. He had earlier visited Japan, South Korea and China. Specter said after the bombing there should be a shake-up at the Pentagon and questioned whether Perry should resign. He said he was not satisfied with some of Perry's answers to the committee's questions in closed testimony last month. The question of whether Perry should resign remained open, the Pennsylvania Republican said. FBI Director Louis Freeh, who has twice visited Saudi Arabia to seek improved cooperation with Saudi investigators, told the committee he was not entirely satisfied with Saudi cooperation on the Dhahran bomb and a previous bomb attack in Riyadh. "If we're to stay in Saudi Arabia, we need to have total cooperation," Specter said. The United States has 5,000 U.S. air force and other military personnel in Saudi Arabia. 3374 !GCAT !GVIO A Sudan Airways plane with 199 passengers and crew which was hijacked to Cyprus took off from Larnaca airport after refuelling and headed to Britain early on Tuesday, witnesses said. Police said an unknown number of hijackers were on board the Airbus 310 which was hijacked on its way from Khartoum to Amman in Jordan. One had threatened to blow it up unless it was refuelled and they were taken to London where they intended to surrender and seek political asylum. 3375 !GCAT !GVIO Cypriot authorities ordered the refuelling early on Tuesday of a hijacked Sudanese Airbus 310 parked at Larnaca airport after armed men threatened to blow it up unless they were flown to London, a police spokesman said. The Sudan Airways plane was hijcked on Monday night en route from Khartoum to Amman in Jordan with 186 passengers and 13 crew on board. Police said they believed there was more than one hijacker and at least one was armed with grenades and TNT. They wanted political asylum in Britain, police said. Cypriot authorities negotiated through the pilot with one of the hijackers for him to release all women and children on board before refuelling but he refused and was quoted as saying: "I will blow the plane up." He later said he would release all passengers on arrival in London, the police spokesman said. "We are making every effort to get the passengers free," Xenos told reporters. Refuelling began and was expected to take about 20 minutes. The plane would then leave for London, Xenos said. The identity of the hijackers was not known. One of them negotiated through the pilot in English, police said. The Airbus 310 was parked at the western edge of Larnaca's coastal airport and was ringed by police. Anti-terrorist police arrived. Cyprus initially refused permission for the plane to land but allowed it to touch down when the pilot said he was running out of fuel, Cypriot officials said. Cairo airport sources said earlier the plane was hijacked about 20 minutes after it took off from Khartoum airport. It was the second hijacking this year involving a Sudanese airliner. On March 24, a Sudan Airways Airbus A320 plane carrying 40 passengers and crew was hijacked to Eritrea. The two Sudanese hijackers who seized the plane on an internal flight sought political asylum in Eritrea. They surrendered to Eritrean authorities immediately after reaching Asmara, the Eritrean capital. Sudan's Islamist military government has a broad array of political opponents and is waging a bitter war against separatist rebels in the mainly Christian and animist south 3376 !GCAT !GPOL Foreign Minister David Levy suggested on Monday Israeli Prime Minister Benjamin Netanyahu should meet Palestinian President Yasser Arafat "soon". Asked by Israel's Channel One television if thought a Netanyahu-Arafat meeting needed to be held soon, Levy said: "Certainly there is a need. What else? Did someone think that I, as foreign minister, a member of this government, went to meet Arafat as a one-time thing, or a personal matter, or without the prime minister's knowledge?" In recent days a number of figures in Netanyahu's Likud party have pressed the prime minister to abandon fence-sitting over a personal meeting with Arafat, viewed by Israeli rightists as a "terrorist". Levy is the only member of Netanyahu's religious right coalition government to have met Arafat since Netanyahu defeated Nobel Peace Prize laureate Shimon Peres in May elections, Netanyahu has angered Palestinians and confounded many Israelis by refusing to spell out "certain conditions" he has said must be met before he would agree to meet Arafat. Washington, Israel's crucial ally and main sponsor of stalled Middle East peace talks, sees a Netanyahu-Arafat meeting as a means of jumpstarting stalled peace talks. Netanyahu dismayed U.S. officials and alarmed the Arab world by rejecting the bedrock land-for-peace formula which fueled historic peace agreements under the previous Labour government. Peres and slain Prime Minister Yitzhak Rabin held numerous meetings with Arafat. The state-run television said on Sunday Netanyahu would most likely meet Arafat before the prime minister travels to the United States on September 10. Israeli President Ezer Weizman sparked a furore over the issue this week, stepping out from his largely ceremonial role to announce he would invite the Palestinian leader to his home. Israel's Yedioth Ahronoth daily said Weizman had given Netanyahu until Sunday either to agree to meet Arafat himself or give Weizman a green light to issue the invitation. On Sunday an abashed-looking Netanyahu joined Weizman at a hurriedly called news conference at which the president said he thought the prime minister would eventually meet the PLO leader. Levy told the television the government was working to ensure that a Netanyahu-Arafat meeting would be "successful and businesslike, without leaving residues from unmet (promises) from their side or ours." Palestinians are also waiting for a long-deferred Netanyahu decision on Israel's promised troop pullback from the still-occupied West Bank town of Hebron. Peres froze the step early this year in response to a wave of Islamic suicide bombings that killed 59 people in Israel. Palestinians see the Hebron redeployment as a test of Netanyahu's intentions vis-a-vis the peace process. Netanyahu, for his part, counters that the PLO has yet to make good on promises to curb Islamic guerrillas in its midst and to cease political activities in Arab East Jerusalem, claimed as a capital by both sides. 3377 !GCAT !GDIP France has invited Israel's David Levy to Paris for his first official visit as foreign minister in Prime Minister Benjamin Netanyahu's new government, a foreign ministry spokesman said on Monday. Israel's army radio said the trip would take place in early September. It said Levy was expected to meet French President Jacques Chirac and Foreign Minister Herve de Charette. "I can confirm that there is certainly an invitation for an official visit. There are contacts going on to reach an appropriate date but a final date has not been set," spokesman Ygal Palmor told Reuters. Israeli, Egyptian and U.S. officials met in Paris on Monday to discuss reviving the Middle East peace process and a forthcoming economic conference, a U.S. embassy spokesman said. A French Foreign Ministry spokesman said U.S. Middle East peace envoy Dennis Ross met French foreign ministry Secretary-General Denis Bauchard earlier in the day to review the Middle East peace process and tighten coordination between the two countries. "As the peace process goes through a delicate period, it seems important that the Americans and the French, who are very active in the Middle East, may be able to exchange views regularly to help the quest for peace," ministry spokesman Jacques Rummmelhardt told reporters. 3378 !GCAT !GDIP !GVIO Three Afghan rebels of the militant Islamic Taleban movement will fly back to Afghanistan on Tuesday after they were forced to come to the United Arab Emirates by seven Russian airmen they had been holding hostage, officials said on Monday. "They will leave to Kandahar (Afghanistan) early on Tuesday," said one official. "They are leaving upon their own request and with coordination with the UNHCR (United Nations High Commissioner for Refugees)." After a year in captivity, the seven Russian airmen overpowered the three Taleban guards on August 16 and tied them up before flying to the UAE on board their own cargo aircraft. The Russians later left for Moscow. A Taleban MiG-19 warplane last August forced the cargo Ilyushin to land. The aircraft was carrying ammunition to Kabul from Albania. The Taleban charged that the incident was proof of Russian support for the government in Kabul which the militia is fighting to overthrow. 3379 !GCAT !GPOL !GVIO Israeli soldiers shoved and cursed Palestinian Council Speaker Ahmed Korei on Monday as the senior PLO official toured the West Bank town of Hebron, witnesses said. Soldiers shoved Korei, known as Abu Alaa, when he tried to cross an Israeli army checkpoint after completing a tour of the Tomb of the Patriarchs in the heart of the city, one witness said. He said a soldier cocked his rifle and others cursed at Abu Alaa, who was touring the city with Palestinian officials. The troops then allowed the speaker to pass, the witness said. "The Israelis always want to show us that they are the occupying power," Korei told Reuters. "They want to remind the Palestinians that they are under occupation," he said. The Israeli army said it was checking the report. In an apparently unrelated incident, the army said a soldier was lightly wounded in Hebron on Monday by glass fragments after a stone was thrown at his military vehicle. Hebron, a flashpoint of violence as the only Palestinian city with Jews living in it, has been in the spotlight as pressure has mounted on Israeli Prime Minister Benjamin Netanyahu to implement a long-delayed troop redeployment in the city. "The situation in Hebron is very difficult," Korei said. "It is complicated and they (Israel) have complicated it," he said. Israel committed to pull its troops back from Hebron under a peace deal reached between the PLO and the dovish Labour party government Netanyahu ousted in May elections. But the redeployment was delayed after a spate of Moslem suicide bombings killed 59 people in Israel in February and March. Netanyahu has said he was studying a revised redeployment plan submitted by Defence Minister Yitzhak Mordechai. Palestinians view the troop withdrawal as a litmus test for Netanyahu's intentions on Middle East peace moves and reject any renegotiation of the signed Hebron agreement. Israeli troops are to remain in part of the city to guard some 400 Jewish settlers living in heavily armed compounds amidst more than 100,000 Palestinians. 3380 !GCAT !GVIO Heavy fighting broke out between two rival Kurdish factions in northern Iraq at midnight Sunday and at least 29 people were killed, one of the groups said on Monday. The Kurdistan Democratic Party (KDP) said the Patriotic Union of Kurdistan (PUK) had broken the U.S.-brokered ceasefire agreed between the two parties last week. The factions reached a ceasefire on Friday after a week of fierce fighting which had put an end to a truce agreed a year earlier. "The PUK leadership who pledged to end fighting and cooperate with the latest U.S. initiative started a major military offensive against KDP positions," the KDP said in a statement. It said heavy fighting started at midnight in the region dividing the two warring factions, with the PUK aiming to break through to KDP's headquarters in Salahuddin. The KDP said 29 PUK fighters were killed in the attack. It did not provide details of KDP casualties and a PUK spokesman was not immediately available for comment. The statement said the PUK resumed its attack on Monday morning on KDP positions near Rawandouz and indiscriminately shelled the town of Dayana, killing a priest and injuring some civilians. The fighting has threatened a U.S.-led peace plan to unite the mountainous Kurdish region in northern Iraq against President Saddam Hussein. A U.S.-led air force has protected Iraqi Kurds against attack from Baghdad since shortly after the Gulf War in 1991. 3381 !GCAT !GPOL !GVIO Israeli security forces ransacked a Bedouin encampment in the West Bank on Monday to expel them from an area which Palestinians say had been earmarked for Jewish settlement expansion, residents said. They said soldiers demolished shacks and animal barns, overturned water containers and dumped their food on the ground. They also charged that soldiers stole a gold necklace, a pair of earrings and about $2,000 in Israeli currency from an elderly woman and her daughter-in-law while searching their luggage before knocking down their family shacks. "They rammed our shacks with jeeps and destroyed one shack over my baby," said 25-year-old Amina Muhammad, pointing to a pile of corrugated tin sheets. "He was saved only by a miracle." A Palestinian expert on settlements, Khalil al-Tafakji, said the raid was part of Israeli army efforts to clear Bedouins from wilderness close to Arab East Jerusalem to expand Jewish settlements in the area. But a spokesman for the Israeli civil administration, Peter Lerner, said the army wanted to move the Bedouins because they were camping in an area close to a firing range. Lerner said he knew nothing about soldiers stealing from the Palestinians. Israeli security forces have frequently pursued Bedouins living in the desolate wilderness between East Jerusalem and the Dead Sea, where several Jewish settlements have been established since the early 1980s. Israeli Prime Minister Benjamin Netanyahu recently overturned a four-year freeze on settlement expansion imposed by the government of Shimon Peres whom he ousted in May elections. Palestinians, who view settlements as an obstacle to peace, were enraged by the move. Hundreds of landless Bedouin families, many expelled from southern Palestine when the Jewish state was set up in 1948, live in tents or tin shacks in small encampments scattered across the barren wilderness. They survive by raising sheep or working in construction on Jewish settlements. Other Bedouins remained in Israel where they are now citizens. Many serve in Israel's army. Um Salem al-Hadhalin, surrounded by her frightened grandchildren, said the soldiers, armed with clubs and guns, surprised her while making tea for breakfast. She said they cut down tent ropes and knocked down animal barns either by ramming them with jeeps or by pulling them down with ropes tied to their vehicles. She said the soldiers confiscated two tents. Um Salem said the soldiers went through her family's luggage piece by piece, dumping everything on the dirt floor. "They kept telling us that we must move. We are not moving. We have nowhere to go. We have been here for more than 50 years," she said. 3382 !GCAT !GPOL !GVOTE Morocco, ahead of a referendum on constitutional reform, published on Monday the draft of a 108-article new constitution which includes the split of the 333-seat parliament into two chambers. The long-awaited constitutional reforms keep the paramount powers of King Hassan untouched. The referendum will be held on September 13, 1996. The official MAP news agency, which issued the full text of the draft constitution, said one of the main changes "is the setting up of paliamentary bicameral system, with a new higher house called Majlis al-Mustasharin." Majlis al-Mustasharin (Consultative Chamber), will be elected for nine years but renewing one third of its members every three year, MAP said. The parliament or Majlis Anuwab will be elected for five years against the present six years. The two chambers will be chosen respectively through indirect and direct universal suffrage. King Hassan last week urged the country's 12 million eligible Moroccans to cast 'yes' vote in the referendum to amend the 1992 constitution. "The draft constitution aims at setting up a bicameral parliament and new electoral laws. It also aims at the decentralisation, regionalisation and local democracy," the king said in a speech. King Hassan, 67, said local councils, professional and workers representatives would have the main say in the new higher house. "With a decision-making power, the new chamber will have the power to summon the government and pass a vote of no confidence against it," he said. He gave no details of the number of the deputies and structure of the future bicameral parliament. A series of laws aimed at determining the role and structure of both chambers will be presented before parliament for vote in October. The parliament is expected to be dissolved by the end of December in order to start the campaign for the general elections, he said. The king added six new articles to the draft constitution but made no changes in the chapter related to his own strong powers. The referendum on the constitution and general elections will also take place in the disputed Western Sahara regions under Moroccan administration since 1976. The desert territory, whose independence is sought by the Polisario Front, has a dozen deputies in the present paliament which was elected in 1993. 3383 !E51 !E512 !ECAT !GCAT !GDIP Egyptian President Hosni Mubarak's senior adviser Osama el-Baz flew to Paris on Monday for talks with Israeli and U.S. officials on the Middle East peace process and a forthcoming economic conference. Diplomatic sources in Paris said Baz would meet U.S. envoy Dennis Ross and Dore Gold, an adviser to Israeli Prime Minister Benjamin Netanyahu. An Israeli embassy spokeswoman in the French capital said the talks would cover reviving the peace process and preparing for the Middle East economic conference planned in Cairo next November to promote economic integration in the region. 3384 !GCAT !GDIP Egypt will tell Britain it is concerned about a meeting of Islamists to be held in London soon, Foreign Minister Amr Moussa said on Monday. "There is a question mark over this issue. We, and many other countries, don't understand this (Britain's) position," Moussa told reporters. "Egypt will contact the British government to find out the truth of the matter and to discuss the possible consequences of such an unfortunate step," he added. Egyptian government newspapers have criticised Britain for allowing Islamists, whom they brand as "terrorists", to hold their conference, saying the meeting will be a chance for dangerous Moslem militants to plot against their countries of origin. It is not clear when the conference will be held. About 1,000 people have been killed in Egypt since Islamic militants took up arms in 1992 in an attempt to overthrow the government and set up a strict Islamic state. Cairo says several Egyptian militants on the run from death sentences or convictions for violent attacks at home have taken shelter in Britain. 3385 !GCAT !GCRIM !GPOL !GREL Left-wing legislators rushed to the defence of Israel's top judge on Monday after he was branded in an ultra-orthodox newspaper a "dangerous enemy" of devout Jews. An article in the Yated Neeman newspaper said God would help religious Jews overcome Chief Justice Aharon Barak just as the Lord weakened other political foes in Israeli elections last May that returned right-wing and orthodox parties to power. The article blasted Barak over a High Court decision earlier this month to keep open on the Jewish sabbath a Jerusalem street that runs through an ultra-orthodox neighbourhood. "A simple look at the events that transpired here over the past weeks shows that the religious and orthodox public has a dangerous enemy...he is called Aharon Barak," the article said. Legislators from the left-wing Meretz party compared the article to the dubbing, by some nationalists, of Yitzhak Rabin as an enemy and traitor before the prime minister was assassinated last November by a religious Jew opposed to his peace policies. "As we learned, only a thin line divides festering incitement and the person who draws the obvious conclusions," Meretz member of parliament Dedi Zucker told Israel Radio. "It could lead to killing and murder." Former education minister Amnon Rubinstein of Meretz called on Prime Minister Benjamin Netanyahu to condemn the attack on Barak. After Rabin's assassination, his widow Leah accused Netanyahu of failing to curb right-wing protests against him. Moshe Negbi, a legal commentator for Israel Radio, said the article and anti-Barak posters put up in ultra-orthodox areas of Jerusalem "bore all the signs of the incitement and bloodlust...that appeared a year ago against Rabin". The author of the article, Haim Walder, told the radio he was justified in attacking Barak because the judge had no right to decide the Bar-Ilan street issue, a matter which the writer said should have been left to parliament. And, Walder insisted: "There is no such thing as an ultra-orthdox murderer. You can check the jails." 3386 !GCAT !GDIP Egyptian Foreign Minister Amr Moussa flew to Damascus on Monday for talks with Syrian President Hafez al-Assad on the future of the Middle East peace process. Moussa told reporters he would deliver a message from Egyptian President Hosni Mubarak to Assad on regional conctacts aimed at kickstarting the stalled process. Egypt and Syria have coordinated closely on peace moves in the region since the election last May of Israel's hardline Prime Minister Benjamin Netanyahu. The Israeli leader has dismayed Arabs with his rejection of the principle of trading occupied Arab land for peace. He has said that Israel will not return to Syria the Golan Heights it captured in the 1967 Middle East war. Moussa said he would discuss Israel's intentions towards its Arab neighbours when Israeli Foreign Minister David Levy visited Cairo on Sunday. The Egyptian minister said Israel should return to the negotiating table soon so that a Middle Eastern economic summit due to be held in Egypt in November could succeed. Egypt on Thursday said the summit, aimed at regional economic integration, would be pointless unless Israel made a serious effort to carry out peace agreements. 3387 !GCAT !GPOL !GVIO Israeli security forces ransacked a Bedouin encampment in the West Bank on Monday to expel them from an area which Palestinians say had been earmarked for Jewish settlement expansion, residents said. They said soldiers stole a gold necklace and about $2,000 in Israeli currency from an elderly woman and her daughter-in-law while rummaging through their luggage before destroying family shacks and animal barns. "They rammed our shacks with jeeps and destroyed the shack over my baby," said 25-year-old Amina Muhammad. "He was saved only by a miracle." A spokesman for Israel's civil administration in the West Bank said the Bedouins were moved because they were encamped on an Israeli army firing zone. The spokesman Peter Lerner said he knew nothing about soldiers having stolen anything from the Palestinians. Israeli security forces have been pursuing Bedouin Palestinians living in the desolate wilderness between East Jerusalem and the Dead Sea, where several Jewish settlements have been established. The Israeli army also uses the area for military training. 3388 !GCAT !GDEF !GDIP An Israeli cabinet minister proposed on Monday deploying a U.S.-Arab force in south Lebanon once Israel pulls out of its occupation zone. "I suggest that a force made up of Jordanian, Egyptian and American elements maintains security in southern Lebanon since U.N. forces there are not effective," Internal Security Minister Avigdor Kahalani told the Jerusalem-based Arab daily al-Nahar. "If the Syrians are interested in participating in this force, we don't mind," he said. Israel, he said, was willing to foot the bill for the force. Kahalani said the right-wing government's "Lebanon first" proposal -- settling with Syria the issue of south Lebanon before deciding the future of the Israeli-occupied Golan Heights -- was originally his idea. "I am certain of the success of this project (Lebanon first), that Israel pulls out immediately from Lebanon -- we have no reason to be there -- and when we do Hizbollah will not have any excuses to attack us," Kahalani told al-Nahar. Clashes erupt daily in south Lebanon between pro-Iranian Hizbollah guerrillas and Israeli occupying forces and their South Lebanon Army ally. Lebanon and Syria, which has an estimated 35,000 troops in Lebanon, have both rejected Israel's proposal. On peace with the Palestinians, Kahalani said: "I object to the establishment of a Palestinian state, but if it were linked with Jordan in a confederation, then the situation becomes completely different. I back such a confederation." Israel rejects the establishment of a Palestinian state. "The problem is that such a state would have the ability to have an army," Kahalani explained. "This is the only reason." 3389 !E51 !E512 !ECAT !GCAT !GDIP Japanese Foreign Minister Yukihiko Ikeda urged Israel's right-wing government on Monday to make progress towards Middle East peace, dangling the prospect of closer economic ties with Tokyo as a reward. "I expressed Japan's expectations that Israel will move the peace process forward," he told reporters after meeting Foreign Minister David Levy. Calling the current peace process the "only option we have", Ikeda said: "Advancing the peace process in the region will of course bring more development of the ties between (Israel and Japan) in the spheres of the economy and culture." Ikeda invited Levy to pay an official visit to Japan. Levy told reporters he had accepted the invitation, but no date was set. "With Japan, we want to continue to act to advance mutual interests and the peace process," Levy said. On Sunday in self-ruled Gaza, the Japanese foreign minister said he had invited Palestinian President Yasser Arafat to visit Japan from September 10 to 13. Ikeda, who has visited Jordan, Egypt and Syria during his tour, was scheduled to hold talks with Israeli Prime Minister Benjamin Netanyahu later on Monday before flying to Hong Kong. Arabs have condemned Netanyahu for refusing to exchange occupied Arab lands for peace, a principle endorsed by his predecessor Shimon Peres and the basis of the peace talks since 1991. "I will convey what I heard from President Yasser Arafat concerning the peace process, especially the difficulties the Palestinian people are facing and President Arafat's commitment to peace," Ikeda said on Sunday. Japan is the main donor nation aiding the Palestinian Authority and a participant in multilateral Middle East peace talks. Levy said Ikeda had passed on his "impressions" from his visit to Syria, but the Israeli foreign minister did not elaborate. 3390 !GCAT !GDEF !GDIP The U.N. envoy in charge of dismantling Iraq's weapons of mass destruction arrived in Baghdad on Monday for talks with Iraqi officials on the disputed issue of access and other disarmament topics, U.N. sources in the Iraqi capital said. One source said the envoy, Rolf Ekeus, would hold talks with Iraq's Deputy Prime Minister Tareq Aziz during his three day visit. Ekeus, head of the U.N. Special Commission (UNSCOM) on Iraq, is expected to raise the subject of the latest Iraqi obstruction of his arms inspectors and demand once again that Baghdad give them unrestricted access to any site they wish to inspect. The visit is the second by Ekeus in about two months. In June the two sides agreed to hold periodic meetings to accelerate implementation of the 1991 Gulf War ceasefire terms, requiring that Iraq rid itself of nuclear, chemical, and biological arms as well as its stocks of long-range missiles. The Security Council asked Iraq on Friday to stop blocking searches by Ekeus's inspectors for concealed weapons at any site they deemed necessary. In June, Aziz and Ekeus defused a crisis over access. Baghdad agreed to allow U.N. inspectors into all sites including those it regarded as crucial to national sovereignty provided the experts respected Iraqi national concerns during visits. But Iraq balked at several surprise inspections by UNSCOM teams later. The latest obstruction took place last week when the Iraqis barred a small group of U.N. monitors from entering a storage area they suspected of holding banned material. Ekeus was not available for comment as Iraqi officials took him to a government guest house immediately after his arrival. Another U.N. source said the envoy was accompanied by Nikita Smidovich, a Russian ballistic missile expert who led most of the inspection teams that ran into trouble with the Iraqis over access to sensitive sites. The removal of the curbs on Iraqi oil exports, other than limited amounts allowed under a deal Baghdad signed with U.N. last June, relies to a large extent on a report by Ekeus testifying full compliance by Baghdad. Ekeus said last week that Iraq still needed to come clean on its banned weapons and maintained that some materials were still missing. Iraq says it has done all that it is required to do to have the ban on its oil exports completely lifted. 3391 !GCAT !GPOL !GVOTE By Alan Elsner, Political Correspondent The U.S. Democratic Party began a four-day convention on Monday that will nominate President Bill Clinton for a second term and went straight on the offensive against Republican presidential nominee Bob Dole. The very first speaker on the podium lost no time in linking Dole with House of Representatives Speaker Newt Gingrich, self-styled leader of the "Republican revolution" whose poll ratings are among the lowest of any leading U.S. politician. "The Republican Party's leaders have been re-inventing the truth. They want to force the Gingrich-Dole agenda on our parents, our children, our families," said Bill Purcell, a Democratic state representative from Tennessee. Anne Mackenzie, co-chair of the Democratic Rules Committee, made the message even plainer. "Yo Newt, get a heart, get a soul, get another job in Georgia," she said. Texas representative Martin Frost also joined the assault, accusing Gingrich of trying to take school lunches out of the mouths of American children. The 50-year-old Clinton leads Dole, 73, in the polls by between five and 12 percentage points going into the convention. He hopes to stretch that lead over the next four days, which will climax with his speech on Thursday accepting his second presidential nomination. The president has dominated the headlines for the past week, overshadowing Dole. He aims to continue that with a barnstorming train trip across the American heartland that began on Sunday and has stirred memories of former President Harry Truman's "give 'em hell" campaign style. Day two of the trip found Clinton in full campaign mode, chugging across Ohio, addressing large enthusiastic crowds at every stop. Images of Clinton were beamed into the Chicago convention centre as proceedings got under way in an arena that is usually home to basketball superstar Michael Jordan and the Chicago Bulls. Clinton, looking for his own slam dunk against Dole, began the day by proposing a tightening of the Brady Bill, which requires a five-day waiting period for handgun purchases, to make it more difficult for perpetrators of domestic violence to acquire firearms. "Under the current law, thousands of people who are wife beaters or child abusers ... can still buy handguns with potentially deadly consequences," Clinton said. His speech neatly dovetailed with the theme of the convention on Monday, when it was to be addressed by Sarah Brady, whose husband Jim was badly wounded during an assassination attempt on President Ronald Reagan in 1981. Also scheduled on the opening day were a tribute to Ron Brown, the commerce secretary and former party chairman killed earlier this year in a Balkan plane crash, as well as an appearance by actor Christopher Reeve, star of the Superman movies, who is paralysed from a horse riding accident. The Democrats are unusually united behind Clinton, who most see as their only hope for defeating the Gingrich Republican brigades. Divisions over Clinton's controversial decision to sign a radical welfare reform bill last week are likely to be papered over. Democrats are also hoping the president's coat-tails are long enough for the party to recapture control of one or both houses of Congress from the Republicans. "There are members of the party with divergent views but they've decided they will do better to subordinate their beliefs to Clinton's in order to survive," said Robert Holsworth, a political scientist with Virginia Commonwealth University. Dole was resting at a cottage in Santa Barbara, California, where he planned to stay until the Democrats fold the tent on their Chicago show but his campaign released a tough commercial assailing Clinton's record in the battle to combat drug use. In coming days, Clinton plans to highlight other issues where he believes he has strong public support, with major announcements on education and the environment before arriving in Chicago on Wednesday. 3392 !GCAT !GDIS !GWEA Hurricane Edouard churned west-northwest through the Atlantic Ocean on Monday and forecasters were watching closely to see if the powerful storm would threaten the United States. Forecasters said the storm was likely to pass northeast of the Caribbean, but could hit Florida or further north along the East Coast. At 5 p.m. EDT (2100 GMT), the centre of Edouard was located near latitude 18.6 north, longitude 55.0 west, or 450 miles (725 km) east-northeast of the Leeward Islands of the eastern Caribbean and moving west-northwest at 14 mph (23 kmh). Maximum sustained winds had increased to 140 mph (225 kmh), making Edouard a potentially deadly Category 4 storm. Hurricane-force winds extended 35 miles (55 km) out from the centre. Tropical storm force winds extended out 175 miles (280 km). "At the moment it looks like it will pass to the north and probably be a bigger threat to the mainland United States. At its current course, it's possible it could hit Florida or the eastern seaboard," meteorologist Fiona Horsfall said. "It would have to make some odd turns at this point to end up in the Caribbean," she said. In Charlotte Amalie in the U.S. Virgin Islands, residents said they were relieved that Edouard was expected to pass to the north, but Gov. Roy Schneider told a news conference that preliminary precautions were under way. Residents headed for grocery stores to stocking up on supplies just in case. "I'd rather be safe than sorry," said Joe Smalls as he filled his cart. If it hit, Edouard would be the fourth hurricane to affect the U.S. Virgin Islands in less than a year. None of the three hurricanes that have formed during the current June-to-November Atlantic hurricane season has caused extensive damage, although Hurricane Bertha was blamed for nine deaths during in July. Forecasters said it was too early to say whether Edouard would threaten North America. If it were to move westward, the powerful storm would reach the southeastern United States in about five days, they said. If it turned more to the north, it would reach Bermuda in about four days. "At this time we don't have anything established as to what the track might be," Horsfall said. Separately, the National Hurricane Centre said Tropical Depression Six had formed in the eastern Atlantic on Monday. At 5 p.m. EDT (2100 GMT), the depression's centre was located near latitude 15.4 north, longitude 42.9 west, or about 1,200 miles (2,000 km) west of the Cape Verde Islands. The depression was moving west near 20 mph (30 kmh), and that motion was expected to continue for the next 24 hours. The depression will become Tropical Storm Fran if maximum sustained winds reach 39 mph (60 km). 3393 !CCAT !GCAT !GCRIM !GVIO By Gail Appleson, U.S. Law Correspondent A plot by three militant Moslems to bomb 12 U.S. passenger jets last year was very real and the defendants had the know-how and will to carry it out, a federal prosecutor said on Monday. In closing arguments at the trial of the three accused plotters, Assistant U.S. Attorney Dietrich Snell told a Manhattan federal jury that if a fire had not broken out in the Philippine apartment being used to make the bombs, the scheme would have been executed. "The defendants' plan was very real. They had the material, they had the know-how and they had the determination to carry out the plan with deadly precision," he said. The three have been on trial since May for their alleged plan to destroy the planes within a 48-hour period last year and kill about 4,000 passengers as they returned to the United States from the Far East. The government's presentation of evidence entered a crucial phase last month at about the same time as the fatal TWA explosion over Long Island, New York. All 230 passengers and crew on board were killed. Reports speculating that the defendants might have some connection to the explosion caused U.S. District Judge Kevin Duffy to question jurors as to whether their judgment had been affected by the disaster. The government's evidence included a laptop computer seized from a Manila apartment shared by two of the defendants that held files calling a scheme "Bojinka." It contained flight schedules and code names for the defendants who would carry out the bombings aboard Delta, Northwest and United planes bound for the United States from the Far East. The schedules were for flights with stopovers before they reached the United States. A letter in the computer said the purpose of the attacks was to punish the United States for its support of Israel. Snell said the word "Bojinka" should have become part of the jurors' vocabulary, "synonymous with one of the most hideous crimes ... ever conceived." The alleged ringleader of the airline bombing scheme was Ramzi Ahmed Yousef, who will be tried again this year on charges that he masterminded the 1993 World Trade Centre bombing that killed six people and injured more than 1,000. "He was the architect of the whole scheme. He was the chief recruiter," Snell said. Snell concluded about 4-1/2 hours of arguments on Monday and Yousef, who is representing himself with the aid of a legal advisor, will give his statements on Tuesday. Arguments on behalf of the other defendants, Abdul Hakim Murad and Wali Khan Amin Shah, are scheduled for Tuesday and Wednesday. The case is expected to go to the jury on Thursday. Yousef is also charged with placing a bomb on a Philippine Airlines flight from Manila to Tokyo on Dec. 11, 1994, as a trial run. The bomb exploded under the seat of a Japanese passenger, killing him and injuring 10 other people. The flight originated in Manila and Yousef allegedly left the plane during a stopover. Prosecutors alleged that he mixed the bomb in a restroom during the first leg of the flight and placed it under his seat with the timer set to detonate the bomb after the plane left for Toyko. The plot to bomb the airliners was uncovered on Jan. 6, 1995, when a fire broke out in a Manila apartment where Yousef and Murad were mixing chemicals. Snell said that when Philippine police searched the apartment "They found a terrorists' lair" that included bomb making instructions, timers, explosives and the computer. 3394 !GCAT !GCRIM !GPOL !GVOTE Republican presidential candidate Bob Dole picked one of the most chilling images in American political history on Monday to drive home his campaign theme that drug abuse is as great a threat as nuclear war. A stark new black-and-white Dole television campaign ad uses the famous image of a little girl picking a daisy -- first used in 1964 by Democrat Lyndon Johnson, who followed the girl's image with that of a nuclear mushroom cloud. "Thirty years ago, the biggest threat to her was nuclear war," the narration says. "Today the threat is drugs." The new commercial was released on Monday in Santa Barbara, where Dole is on a working vacation, and in Washington. Paid for by the Republican National Committee and authorised by Bob Dole's presidential campaign, it will appear starting on Tuesday in selected markets, including Chicago where the Democrats are having their nominating convention. Dole, campaigning near Chicago on Sunday, accused President Bill Clinton of "raising the white flag" in the war on drugs after a survey last week found that illegal drug use from 12-17 year-olds had doubled in the past four years. In that speech, Dole did not use the nuclear imagery but he did call drug trafficking the "moral equivalent of terrorism." The new ad, which dissolves from the "daisy girl" to harsh images of a crack pipe, a heroin spoon and a needle stuck in an arm, attacks Clinton's drug record and concludes "America deserves better." The ad will rotate with another one, released last week as part of a $3.5 million ad buy, on Dole's economic policy and his pledge to slash taxes and balance the budget. Dole was in a secluded cottage on the grounds of the luxurious Biltmore Hotel in Santa Barbara. He had some meetings with advisers, but no public events scheduled on Monday, and his aides said most of his day was devoted to relaxing and soaking up the sun in the nation's biggest state, with 54 electoral votes. He has a few campaign events scheduled for later this week, but the plan is to maintain a fairly low profile during the Chicago convention. Similarly, Clinton vacationed in Jackson, Wyoming while the Republicans convened in San Diego to nominate Dole. 3395 !GCAT !GCRIM !GPOL !GVOTE President Bill Clinton on Monday rolled out a proposal to deny handguns to "wife beaters and child abusers" as his flag-waving campaign train rolled toward Chicago where the Democratic Convention was opening for business. Energised by large, friendly crowds along a whistlestop route that took him across Ohio, a battleground in his Nov. 5 election fight with Republican Bob Dole that he carried in 1992, Clinton also boasted of a long litany of domestic accomplishments and hammered Dole's $548 billion tax cut plan. "It's a whole lot bigger than the tax cut I'm promising," he said at a rally in this small rural town. "There's a big difference between what I'm promising and what they are -- we can pay for mine." Clinton, who arrives in Chicago late on Wednesday to accept his party's nomination for a second term, said he would "not propose anything in my speech Thursday night to the American people, or in my campaign, that cannot be paid for as we balance the budget." The 50-year-old Democrat, his face sunburned and his shirt soaked with sweat, said his stance would pay off for voters in the form of lower home mortgage and credit card interest payments. Shaking outstretched hands after speaking, Clinton found 98-year-old Retta Lafaun Plott, who was celebrating her birthday and had almost fainted from the heat. Clinton escorted her gently to the podium and led the crowd in singing "Happy Birthday." "It's been a long time since I've made a girl faint," he told her. The main emphasis of the day came in Columbus, Ohio's capital, where Clinton started the second leg of his four-day trip earlier on Tuesday. Speaking at the Columbus Police Academy with lines of police as his backdrop, Clinton said public safety should not be a partisan issue but "an American issue," and proposed a tightening of the Brady Bill, which requires a five-day waiting period for handgun purchases. "Under the current law, thousands of people who are wife beaters or child abusers ... can still buy handguns with potentially deadly consequences," Clinton said. "I believe strongly in the right of Americans to own guns. I have used them as a hunter with great joy." "But make no mistake: those who threaten the safety of others do not deserve our trust," he said. A White House statement said there were 88,500 incidents of domestic violence in 1994 where a firearm was present. Over a 10-year period ending that year, it said 65 law enforcement officers were killed when responding to family quarrels. Clinton also recycled his oft-made call for the outlawing of powerful "cop killer" bullets, powerful bullets that can penetrate material that is otherwise bulletproof. "If a bullet can slice through a bulletproof vest like a hot knife through butter, it should be against the law," he said. Clinton, travelling with his daughter Chelsea, 16, while his wife Hillary conducted a separate schedule in her hometown of Chicago, planned to try to grab headlines with a new proposal every day of his train trip. Tuesday's will concern education; Wednesday's, the environment. White House spokesman Mike McCurry said the overall cost of Clinton's initiatives was about $8 billion, and that the campaign would spell out on Tuesday how they would be paid for. Clinton's 559-mile (894 km) trip will take him through five states with 64 of the 270 electoral votes needed to win the presidency. 3396 !GCAT !GDEF !GDIP The United States on Monday again rejected a demand by China that it scrap a planned sale of Stinger anti-aircraft missiles and other arms to Taiwan. Calling the hardware "purely defensive," the State Department said the sale was consistent with a 1982 U.S.-Chinese joint communique on arms sales to Taiwan and was proceeding. "We certainly don't expect that this will result in a marked further deterioration in our relations," said Glyn Davies, the department's acting chief spokesman. Earlier in the day in Beijing, the Chinese foreign ministry warned that the sale, notice of which was sent to Congress last week by the Pentagon, would cause "new damage" to slowly improving U.S.-Chinese relations. It involves 1,299 lightweight Stinger missiles, 74 trainer missiles, 74 launchers, 96 Humvee military vehicles and 500 rounds of .50 calibre ammunition valued at about $420 million. Separately, Davies said the United States was looking into reports that China is helping Pakistan build a factory for medium-range missiles in possible violation of international arms control pacts. The Washington Post, citing U.S. intelligence officials, said over the weekend that the factory in a Rawalpindi suburb was expected to be capable of producing most major components of a missile modelled after the Chinese-designed M-11. "We're looking into it, obviously, because it's an important matter," Davies told a regular news briefing. "But we're not at the stage where we can say anything definitive." China and Pakistan each denied any such missile factory was being built. If it is, China would be violating commitments it made to the United States not to deploy M-11s in Pakistan. The United States has twice imposed limited economic sanctions on China for sharing weapons technology with Pakistan, lifting them after China vowed to stop. Davies said he knew of no U.S. willingness to halt the planned sale of military hardware to Taiwan, which China considers a renegade province, in exchange for an end to Beijing's reported role in building the suspected missile factory in Pakistan. "I'm not aware of any linkage between the two," he said. "There shouldn't be." The U.S. Congress now has 30 days to either reject the sale or allow it to go through. Defence officials told Reuters they expected the sale to be completed. Beijing has regarded Taiwan as a renegade province since the end of China's civil war in 1949. 3397 !GCAT !GCRIM !GVIO The mother of Olympic bomb suspect Richard Jewell made a tearful plea on Monday to President Bill Clinton to clear her son's name as his lawyers vowed to file civil lawsuits over media reporting of the case. "He cannot work. He cannot know any type of normal life. He can only sit and wait for this nightmare to end," Barbara Jewell told a news conference. "I am asking the president for help. As the head of the Justice Department and the FBI, he has a moral duty to the citizens of this country," she said, breaking into tears. "If the FBI does not intend to charge my son, please tell us. Please tell the world." Jewell has maintained his innocence since he was first named by the Atlanta Journal as a suspect in the July 27 bombing at Centennial Olympic Park that killed two people and injured 111 others. "We obviously have some very real concerns in terms of looking closely at how this story was reported by the Atlanta Journal. We have some concerns about how certain members of the television media commented upon this story," attorney Lin Wood said at the same news conference. "At some point in the near future, some appropriate legal action will be instituted on behalf of Mr. Jewell in a civil proceeding," Wood said. He said the Journal's initial report contained false allegations and incorrectly claimed that the security guard sought publicity for himself after the bombing. "Richard was portrayed as a matter of fact as fitting a profile. He does not factually fit that profile," Wood said. "Richard Jewell, to our knowledge and from our investigation, at no time initiated any contact with the news media." His lawyers complained that the Federal Bureau of Investigation had had sufficient time to make a case against the former sheriff's deputy. "We're four weeks beyond their search of his home, his automobile, his cabin where he once lived," Wood said. "This is not the Olympic park bomber. Richard Jewell is an innocent man and he is a victim of some very, very cruel circumstances." Mrs. Jewell, an insurance claims coordinator, said her son "has been convicted in the court of public opinion." She said the FBI had turned her apartment upside down, taking rugs, clothing, books and childrens' video tapes and rifling through her personal papers, telephone directory and calendar. "They went through my undergarments. They searched every inch of my home and every item in my home," she said. "We wake up to photographers. We go to sleep to photographers. We cannot look out the windows. We cannot walk our dogs without being photographed and confronted," she said. Jewell's attorneys also said they would continue their efforts to unseal the search warrant that allowed the FBI to search his apartment and truck several days after the bombing. 3398 !GCAT !GCRIM !GPOL !GVOTE President Bill Clinton on Monday launched a Democratic Convention-linked barrage of policy initiatives by calling for a ban on the sale of handguns to people convicted of domestic violence. Clinton unveiled the anti-crime proposal, which was designed to widen the gender gap which gives him an edge over Republican Bob Dole among women voters, as he started the second leg of 559-mile train trip to Chicago, where party activists were gathered to renominate him. Speaking at the Columbus Police Academy, with lines of police as his backdrop, Clinton said public safety should not be a partisan issue but "an American issue." "Under the current law, thousands of people who are wife- beaters or child abusers ... can still buy handguns with potentially deadly consequences," Clinton said. "I believe strongly in the right of Americans to own guns. I have used them as a hunter with great joy." "But make no mistake: those who threaten the safety of others do not deserve our trust," he said. A White House statement said there were 88,500 incidents of domestic violence in 1994 where a firearm was present. Over a 10-year period ending that year, it said 65 law enforcement officers were killed when responding to family quarrels. Many spousal abusers are not now affected by a ban on the sale of firearms to convicted felons because many domestic violence cases are treated as misdemeanors. Clinton's proposal would expand the Brady Bill, which requires a five-day waiting period for handgun purchases to run background checks and which bans felons from buying guns. Clinton also called for banning cop-killer bullets, saying every law enforcement group backs it and Congress should too. "If a bullet can slice through a bulletproof vest like a hot knife through butter, it should be against the law," he said. Clinton, on an old-fashioned whistlestop train tour through the Midwest with his daughter Chelsea, 16, while his wife Hillary conducted a separate schedule in her hometown of Chicago, intended to grab headlines with a new proposal every day of his trip. Tuesday's will concern education; Wednesday's, the environment. His focus on crime was designed to tie into the opening session of the convention, which featured a speech by Sarah Brady, wife of former White House spokesman James Brady, whose wounding inspired the gun law. Brady is wheelchair-bound because of the gunshot wounds he suffered when John Hinckley Jr. tried to kill then-President Ronald Reagan in 1981. Clinton, campaigning through five states with 64 of the 270 electoral votes needed to win the presidency on his way to Chicago, is on the 559-mile trip to energise grassroots support for his re-election bid. In a USA Today/CNN poll released on Monday, Clinton held a 12 percentage point lead over Dole among registered voters, beating the Republican 50-38 with independent Ross Perot winning only 7 percent. Clinton boarded his "21st Century Express" for the four-day whistlestop in Huntington, West Virginia, on Sunday and rolled through parts of Kentucky before reaching Ohio. His train will also travel through Michigan and Indiana. As he has at every previous stop, Clinton slammed the tax cut proposal at the heart of Dole's campaign. "We cannot afford to blow a hole in the deficit again," he said. Clinton was heckled at the start of his speech by a small group of demonstrators, but he silenced them by saying they did not want the American people to know of his record. If the public learns the truth, Clinton said, his opponents "won't have a chance." 3399 !GCAT !GPOL !GVOTE Chastened by a landslide defeat to Republicans in 1994 congressional elections, Democrats said on Monday they have learned a hard lesson and have a shot at winning back a majority in Congress this November. Republicans swept to a majority in the House of Representatives for the first time in 40 years in 1994, picking up 52 seats in the 435-member chamber and leaving the Democrats demoralized and directionless. "It was a clear loss. We got thrashed," House Democratic Leader Richard Gephardt said. What a difference two years makes. Polls show the architect of the Republican revolution, Speaker Newt Gingrich, is one of the most unpopular politicians in America. The Republican Congress was blamed more than President Bill Clinton for shutting down the government last winter in a bitter battle over balancing the budget. And after licking their wounds for a while, Democrats went back to the drawing board. They took a page out of the winning Repubican "Contract With America" campaign playbook and launched a national campaign agenda for 1996 called "Families First". Democrats need to pick up a net 20 Republican seats in November to get to the magic majority of 218 in the House, but 19 seats would giving them working control if a socialist who usually votes with them is re-elected. "We are going to pick up the majority and we will do it with significantly more than 19 (seats)," Martin Frost, the Democratic Congressional Campaign Committee chairman, said on Monday. Democrats said opinion polls show their candidates leading Republican incumbents in 11 districts and not one Democrat incumbent is losing to a Republican. But the election may well be decided over 31 Democratic "open" seats where the incumbent is not running. Some 19 of these are in the South which has moved increasingly Republican and those will be tough to defend. Democrats say they can win Republican seats in the East, in Washington state, Oregon, California, Nevada, Wisconsin, Nebraska, Kansas and Iowa. Unlike Gingrich, who was virtually absent from the speakers podium at the Republican convention in San Diego, Gephardt and Senate Democratic Leader Tom Daschle have been given a prime time slot on the Chicago convention schedule on both Monday and Tuesday to set out their case for a new Democratic majority. Democrats also are using their convention to showcase some of their top challengers in the congressional elections -- 10 candidates paraded for the press at a news conference on Monday. A good example was hometown Chicago boy Rod Bagojevich, the Democrat running for the seat of Mike Flanagan, a freshman Republican who shocked the political world by unseating congressional powerbroker Dan Rostenkowski in 1994. Now Rostenkowski, the one-time chairman of the House Ways and Means committee, was serving a jail sentence after pleading guilty to fraud and Flanagan is fighting for his political life. "In 1994 I think America gave us a message ... They were rejecting the position Democrats were taking protecting every single program that had been in existence for decades," said Blagojevich. "The new approach has to be more mainstream and But the respected non-partisan Cook Report says it will be an uphill battle for a Democratic majority in the House and puts the chances no better than one-in-three. Cook political analyst Jennifer Duffy said recent polls show that after months of Republicans trailing badly, voter preferences are now about evenly split. And a raft of new legislation on health care, increasing the minimum wage and reforming welfare has made the Republican Congress look more moderate and activist. "The Democrats have about as much chance of retaking the House as the Chicago Cubs have of winning the World Series," Republican National Committee spokesman in Chicago John Czwartacki said, referring to the perennial Chicago baseball losers. 3400 !CCAT !GCAT !GDIS !GVIO The TWA jet that exploded in a deadly fireball last month was once used to transport U.S. troops, who could have been the origin of explosive chemical traces found in the plane's debris, officials said on Monday. Investigators said they still do not have enough evidence to determine whether a bomb, a missile or mechanical failure caused the Boeing 747 to crash off the coast of Long Island, New York, on July 17, killing all 230 people on board. They are trying to determine the source of chemical explosive traces on the debris, which the FBI will not name officially. But investigators said privately it was PETN, found on a piece of a passenger seat. James Kallstrom, the chief FBI investigator in the case, said at a media briefing that the jet was believed to have been used in recent years to transport U.S. military troops to the Middle East. "We don't know exactly when, what conditions, what outfits, where they went, who they were and all that stuff," he said after the briefing. "We'll pin that down." Asked about the explosive traces, he said "We really don't know how it came on board. That's part of the issue we're dealing with here." PETN is a chemical compound commonly found in both plastic explosives and surface-to-air missiles. A report over the weekend in New York's Daily News said traces of nitroglycerin also were found in the wreckage, but Kallstrom said investigators were considering the possibility that the chemical was carried on board by a passenger who took it to treat a heart condition. While nitroglycerin can be used in making a bomb, it also is widely used to treat angina. Robert Francis, vice chairman of the National Transportation Safety Board, said at the briefing that investigators studying two of the plane's fuel pumps, located near the centre fuel tank where the explosion is believed to have occurred, found "nothing exceptional" so far. However, he noted, experts have been unable to study probes that were used to measure fuel in the plane's centre tank because they are still missing, he said. More than 60 percent of the plane has been recovered, Francis said. Officials also said the search for debris from Flight 800 was narrowing to an area of just several hundred yards (meters) of the Atlantic Ocean floor. The wreckage once spread in a swath a mile and a half long (two and a half km). One of the two U.S. Navy salvage ships used in the search will be leaving the scene, probably on Tuesday, Francis said. The remaining area to be searched measures 400 yards (365 metres) by 400 yards (365 metres), he said. Of the wreckage, there seems to have been more recovered from the plane's right side than its left side, he added. Kallstrom said wreckage had been found more than 100 miles (160 km) away on the New Jersey shore. Of the 230 victims, the bodies of 210 have been recovered and Francis said there was a possiblity one more body also had been found. 3401 !GCAT !GDIP !GPOL Burma's democracy campaigner Aung San Suu Kyi was honoured by the U.S. Democratic Party on Monday as a standard bearer for human rights in the face of repression by the country's military government. Suu Kyi, who refuses to leave her country for fear that the military will not allow her back, was given the Averell Harriman Democracy Award of the National Democratic Institute at a lunch during the party's national convention. The institute gave the award jointly to Suu Kyi and to former U.S. Vice President Walter Mondale, now ambassador to Japan. Presenting the award to Suu Kyi's husband, Michael Aris, U.S. ambassador to the United Nations Madeleine Albright said the Asian state's government was "one of the most oppressive and intrusive on Earth" Albright said the "bravery and sacrifice" of Suu Kyi, a Nobel Peace Prize winner who was under house arrest for six years up to July last year, were part of a larger struggle for freedom across the world that was "never easy and never over." Suu Kyi, in a videotaped acceptance message played to the audience of Democrats and invited diplomats from around the world, said despite the persecution of her National Democratic Party, her fight would continue. "We remain strong in our resolve and we know that we shall reach the goal that we wish to reach, with the help of the people and the support of the international community," she said. Albright urged "our friends in Asia and elsewhere who advocate constructive engagement (with the Burmese authorities) to be sure that their engagement is, in fact, constructive." Washington has tried to persuade states in the region to adopt a tougher policy toward the Burmese military rulers. Mondale, a former chairman of the institute, was given the award for being "a leading voice in U.S. foreign policy to promote human rights." 3402 !C24 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Rains associated with Hurricane Dolly helped replenish soil mositure levels during the week ended Sunday, the state's agriculture statistics service said in its weekly crop progress report. "Rains could not have come at a better time in many central and southern regions as stock tanks had gone dry and pasture grasses were nonexistent," the report said. Meanwhile, harvest of the state's cotton crop was twelve percent complete, on par with last year and the average. Cotton condition was rated 48 percent good to excellent, 28 fair and 24 percent poor to very poor. Fifty-five percent of the sorghum was harvested, versus 62 last year and the average of 60 percent. Sorghum condition was rated at 52 percent good to excellent, 28 fair and 20 percent poor to very poor. Fifty-four percent of the state's corn was harvested, ahead of 50 last year and the average of 48 percent. The corn crop was rated 49 percent good to excellent, 14 percent fair and 37 percent poor to very poor. Range and pasture condition was rated 19 percent good to excellent, 36 fair and 45 poor to very poor. Livestock conditions remained good, the report said. --Greg Frost, 816 561-8671 3403 !GCAT !GSCI As her six-month mission to Russia's Mir space station neared its end, U.S. astronaut Shannon Lucid said on Monday she wished her husband was there to help with the packing. Lucid, who has worked aboard Mir since March, is getting ready to fly home aboard shuttle Atlantis in mid-September. Over 2,000 pounds (907 kg) of cargo, including the results of Lucid's research on Mir, will be returned to Earth by Atlantis. "I'm sort of wishing that my husband was here because whenever we go on a vacation he's always the one that packs up everything," Lucid said in a televised news conference from space. "I'm not all that good at packing up the suitcases." The 53-year-old mother of three said she was gathering her gear and had already packed some bags. Lucid, along with Yuri Onufrienko and Yuri Usachev, her Russian crewmates for the past five months, welcomed a new three-member crew to Mir on Aug 19. The arrival of Valery Korzun, Alexander Kalery and Frenchwoman Claudie Andre-Deshays made for crowded conditions aboard the 10-year-old space complex. "It's just like when your relatives come and visit," said Lucid. "Things have been really busy". On Sept. 2, Onufrienko, Usachev, and Andre-Deshays will return to Earth aboard a Russian Soyuz capsule, leaving Lucid, Korzun and Kalery to await the arrival of the shuttle. Atlantis, due for launch from Florida's Kennedy Space Centre no earlier than Sept. 12, also will carry John Blaha, Lucid's replacement on Mir. Blaha, a Vietnam veteran who celebrated his 54th birthday on Monday, will stay on Mir until January. Lucid told reporters she had this advice for Blaha: "Just go with the flow and enjoy all of the surprises that come along." 3404 !C12 !CCAT !GCAT !GCRIM !GDIS Families of the victims of the ValuJet crash in Florida last May and an aircraft maintenance contractor under criminal investigation have requested permission to inspect crash wreckage, lawyers said on Monday. SabreTech Inc, which along with ValuJet has been sued by the families of crash victims, filed a motion last week asking for court permission to see the crash wreckage. All 110 people aboard the DC-9 died when it went down in the muck of Florida's Everglades on May 11. Families of many victims have filed lawsuits against the airline and SabreTech, the maintenance contractor that handled oxygen canisters that may have started or fuelled a fire on board the plane. Atlanta-based ValuJet suspended its contract with SabreTech after the crash. After a brief hearing in U.S. magistrate's court on Monday, lawyers for the plaintiffs said they wanted to see the wreckage of Flight 592 to determine what happened to the victims in their final moments. "Knowing whether they died instantly or lived for two or three minutes ... that's important to the damages and it's important to the families," said Kevin Malone, attorney for several of the plaintiffs. He said any eventual settlement or jury award in the case would calculate payments to families based on several criteria, including how long the victims suffered. "What I think we'll find is people in the front of the plane had a different experience than people in the back of the plane," he said. U.S. magistrate Stephen Brown said he was not certain he had jurisdiction over the case and asked lawyers to provide additional information about similar cases within 10 days. In its motion, SabreTech said it had learned that the FBI wanted to inspect and possibly take wreckage for testing, and the company demanded to be allowed to inspect and photograph it. Lawyers for the families asked the court to allow them to see the wreckage as well. The National Transportation Safety Board, which probes airline crashes, told Brown in a letter that it did not generally allow access to wreckage in its custody. The NTSB normally returns wreckage to the airline when it is finished with it. However, the NTSB said it had received a subpoena for the wreckage from a federal grand jury and intended to comply with it. Federal agencies are conducting criminal probes into the ValuJet crash, according to several published reports. FBI agents raided SabreTech's Miami airport facility earlier this month. NTSB investigators sorted the wreckage -- about 75 percent of the plane -- and reassembled crucial sections in a hangar at a commuter airport near Miami. It is now in storage in shipping containers at a Fort Lauderdale, Florida warehouse. Federal investigators have not yet determined the cause of the crash, but they are focusing on more than 100 oxygen generators -- used to supply emergency masks -- loaded into the front cargo hold. 3405 !GCAT !GDIP The United States said on Monday that it saw no useful role for Iran to play in northern Iraq, where a shaky U.S.-brokered ceasefire has had some success in curbing inter-Kurdish fighting. "Iran, in our view, can play no useful role in northern Iraq in this conflict among the Kurdish factions," the State Department said. Iranian Foreign Minister Ali Akhbar Velayati, in remarks published earlier in the day, had claimed only Iran could bring peace to the area. Guerrillas of Kurdish warlord Jalal Talabani of the Patriotic Union of Kurdistan (PUK) have been fighting in northern Iraq against rebels of Massoud Barzani, head of the Kurdistan Democratic Party (KDP). Washington brokered a ceasefire on Friday and persuaded the two main factions in the north to attend peace talks at an unspecified date next month in London, hosted by Britain. But fighting between reportedly flared over the weekend. In its statement on Monday, the State Department called on both sides to fulfil their commitments to implement an immediate ceasefire and return their forces to positions held before Aug. 17. "In our view, continued fighting between the Kurds would only set back their interests," Glyn Davies, the department's acting chief spokesman said. He said such fighting also cleared the way for outside forces to pursue their own agendas. Iraq's Deputy Prime Minister Tareq Aziz Sunday accused Iran of taking sides in the latest flare-up and described Tehran's action as "hostile, flagrant ... and harbouring serious expansionist tendencies." The ruling Baath party newspaper al-Thawra in Baghdad said U.S. policy toward Iraq encouraged "Iranian rats to leave their holes." It warned Iran not to take the current situation in the area as a pretext to meddle in Iraq's affairs. Iran sent a small force into northern Iraq last month in pursuit of Kurdistan Democratic Party of Iran (KDPI) rebels. Both Barzani and Iraq accuse Talabani of liaising with Tehran in the latest fighting. Iraq's official press has been critical of Talabani and last week published overtures to lure Barzani to Baghdad's camp. 3406 !GCAT !GCRIM Nearly half of all eleventh grade students in California have experimented with drugs in recent months, a sharp increase over usage four years, according to a statewide survey released on Monday. "Over the past four years, we have witnessed a dramatic increase in drug use among students -- back to the levels that rival peaks 10 years ago," California Attorney General Dan Lungren said. His office co-sponsored the survey. More than one in four seventh graders have experimented with drugs in the last six months. More than 40 percent of ninth graders and almost half of eleventh graders have experimented with drugs in the past six months, Lungren said. "Those are shocking statistics," Lungren said. Nearly 43 percent of eleventh grade students said they used marijuana in the last six months, compared to 29.4 percent four years ago, according to the survey. Nearly 11 percent of ninth graders used amphetamines in recent months versus 3.3 percent four years ago. The use of heroin, LSD and cocaine also increased. Lungren, who held a news conference in Sacramento to announce the results of the survey, criticised companies that use "emaciated, pale models with dark circles under their eyes, known as the 'Heroin Chic' look, to sell clothing." He said the advertisements glamorized heroin. The California survey tracked a recent federal study that found that drug use among teenagers more than doubled from 1992 to 1995, prompting Republican charges that the Clinton administration was to blame. The California survey polled public school students in grades 7, 9 and 11. The survey, which began in 1985, was co-sponsored by the Office of the Attorney General, the state Department of Education, the Department of Alcohol and Drug Programmes and the Department of Health Services. 3407 !C24 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Iowa's corn and soybeans received beneficial moisture during the week ended Sunday, but warm weather was needed to speed development, said the state's agricultural statistics service. The crops were doing well other than lagging in development. Grasshopper infestations were reported in several districts and caused significant damage in a few locations. Grey leaf spot was reported in corn in the southwest. Corn was seven percent dented versus 18 a year ago and 24 average. Thirty-nine percent had reached dough stage versus 55 a year ago 56 percent average. Corn was rated 19 percent excellent, 52 good, 22 fair, six poor and one very poor. Ninety-four percent of the soybeans had set pods versus 96 a year ago and the 93 average. White mold was reported in the northwest, west central and central districts. The crop was rated 15 percent excellent, 53 good, 24 fair, seven poor and one very poor. The third cutting of alfalfa was 27 percent complete, slightly ahead of last year but less than the 33 average. Topsoil moisture was rated four percent surplus, 75 adequate, 18 short and three very short. Subsoil moisture was rated three percent surplus, 69 adequate, 24 short and four very short. Livestock in the east central district were stressed by high humidity. Pastures were rated six percent excellent, 41 good, 34 fair, 14 poor and five very poor. --Chicago newsdesk 312-408-8720-- 3408 !GCAT !GPOL !GVOTE The U.S. Democratic Party on Monday opened a four-day convention that will formally nominate President Bill Clinton for a second term. The convention was called to order shortly after 5 p.m. EDT (2100 GMT). It will culminate on Thursday when Clinton delivers a speech accepting re-nomination to face Republican nominee Bob Dole in the November 5 election. 3409 !C24 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Above normal temperatures and beneficial rains aided Missouri's corn crop and development was ahead of average, the Missouri Agricultural Statistics Service said in its weekly crop update. Ninety-two percent of the corn crop had reached the dough stage as of Sunday, one week ahead of the five-year average of 82 percent. Corn advanced to 69 percent in the dent stage, against 58 percent average. Corn was rated seven percent poor, 28 percent fair, 49 percent good and 16 percent excellent. Soybean development was also ahead of average, with 95 percent of the crop blooming, compared with 92 percent average. Soybeans were rated three percent very poor, 10 percent poor, 30 percent fair, 47 percent good and 10 percent excellent. Sorghum development was about nine days ahead of normal with 92 percent heading versus the five-year average of 88 percent. The crop was rated one percent very poor, six percent poor, 33 fair, 48 percent good and 12 percent excellent. Topsoil moisture was rated 11 percent very short, 28 percent short, 57 percent adequate and four percent surplus. 3410 !GCAT !GODD A 12-year-old Florida boy hanged himself in his backyard just hours before he was due to start at a new school on Monday, police said. Samuel Graham, who told his family earlier that he was nervous about starting at a new school because he feared teasing about his weight problem, had been due to spend his first day at Parkway Middle School Monday, police said. The boy was last seen alive Sunday night when he joined his two younger brothers and father in a bedtime prayer. Two younger brothers found him hanging from a tree early Monday morning. His father cut him down and tried to revive him but paramedics pronounced him dead when they arrived. The Broward County Sheriff's Office found a step stool and a flashlight under the tree where the boy was hanged. They said there was no sign of foul play and that investigators believed the death was a suicide. 3411 !C24 !CCAT !E21 !E211 !ECAT !GCAT !GPOL A state senator from Michigan has asked the state attorney general to review the constitutionality of using public funds to build a new stadium for the Detroit Lions football team in Detroit. In a memo to Attorney General Frank Kelley, State Sen. Michael Bouchard, R-Birmingham, questioned whether a state law allowing counties to seek voter approval of lodging and rental car taxes to help build baseball stadiums could be applied to football stadiums. The Wayne County Board voted last week to place a one percent hotel/motel tax and two percent car rental tax on the November ballot. Revenues from the tax would be used to pay off $80 million of bonds the county plans to issue for the football stadium. "Does this in any way constitute a violation of the legislative intent of the act by avoiding applicability?" Bouchard asked in the memo. Bouchard also questioned an apparent plan by Wayne County and the city of Detroit to use some of the tax revenues for the football stadium in an apparent swap for other funds that had been slated for a new ballpark for the Detroit Tigers baseball team. Those funds slated to be swapped to free up city money for the Lions stadium project were reportedly proceeds from a $40 million tax increment finance bond issue sold by the Detroit Downtown Development Authority earlier this year to cover some infrastructure and land acquisition costs for the new ballpark. Chris DeWitt, Kelley's spokesman, said Monday that Bouchard's request would be reviewed. A development authority official was not available to comment on Bouchard's memo. A comment from Wayne County officials was not immediately available. Under a plan unveiled last week, the county and city would form a stadium authority to oversee building a $225 million domed stadium for the Lions, as well as new baseball stadium planned for the Detroit Tigers that would form a sports complex in downtown Detroit. Meanwhile, Bouchard still has not said whether he would pursue passage of a bill this fall that would allow three Detroit area counties to yank their tax revenue support from $167 million of bonds sold to expand Detroit's Cobo Hall convention center, according to a legislative aide. L. Brooks Patterson, Oakland County Executive, said last week he would push to get the bill introduced this fall. The bonds, which were sold in 1985 and refinanced in 1993, would still be backed with revenues from a state-wide liquor tax should the bill become law. --Karen Pierog, 312-408-8647 3412 !GCAT !GDIP Deputy Secretary of State Strobe Talbott flew to Ottawa on Monday to meet his Russian counterpart and discuss a range of bilateral and European security issues, the State Department said. Talbott, the second-ranking State Department official, was to meet Russian Deputy Foreign Minister Georgy Mamedov as part of a regular pattern of consultations, the department said. "There is much to discuss on the fall calendar," acting chief spokesman Glyn Davies said. "There's a fairly intensive diplomatic calendar coming up in the fall." He said Talbott, who was scheduled to return on Tuesday, would also to meet his Canadian counterpart, Gordon Smith, in Ottawa for talks that would include the situation in Haiti. 3413 !GCAT !GPOL !GVOTE Two days after a poll showed Ross Perot's support faltering in Michigan, the Texas billionaire's name was approved to appear on the Michigan ballot as the Reform Party candidate for president this fall. The Michigan Bureau of Elections board of directors formally approved the party's certification Monday, according to Susan Esser, Reform Party interim state chair. That cleared the way for Perot's name to appear on the presidential ballot in November, said Esser, who is also Michigan director for the Perot presidential campaign. Michigan is the 44th state to give that approval. Last month, the party turned in almost 60,000 petition signatures, nearly double the 30,891 needed to be certified, Esser said in a statement. Perot's Michigan support appeared to be falling among voters. A poll by EPIC/MRI of Lansing published Aug. 24 in the Detroit Free Press showed Perot receiving nine percent of the vote, down from 19 percent from a survey in July. Republican presidential contender Bob Dole picked up much of what Perot lost, capturing 35 percent, with President Clinton receiving 46 percent. In the previous poll, Clinton had support from 48 percent compared to 29 percent for Dole. Perot received 19 percent of the vote in Michigan during the 1992 presidential election, compared to 43 percent for Clinton and 38 percent for then-President George Bush. 3414 !GCAT !GDIS !GENV Reinforcements were arriving on Monday in central Oregon to keep wildfires away from homes as crews across the Western United States fought to protect animal habitats and valuable timber from the flames. The National Interagency Fire Centre, based in Boise, Idaho, said 20 large fires were burning on about 238,000 acres (96,320 hectares). More than 17,650 firefighters were battling the blazes with support from 137 helicopters and 40 air tankers. "Resources are spread thin. There are only so many firefighters and so much equipment and we have so many fires," said Wendell Peacock, information officer for the fire centre. Authorities were on watch for dry lightning in the Washington Cascades, northeast California, north and central Nevada, southern Idaho and southwest Wyoming, fearing lightning strikes could spark several new fires. In Oregon, where 10 major wildfires were burning on nearly 140,000 acres (56,660 hectares), authorities said reinforcements were arriving to help protect homes and animal habitats. As many as 3,000 firefighters from other areas were expected to arrive in the central part of the state on Monday. Many of them would bolster weary crews battling the so-called Skeleton complex blaze, which has charred 20,200 acres (8,175 hectares) near Bend, Oregon. The Skeleton fire spread on Saturday into a subdivision near Bend, destroying 19 homes, 13 other structures and three travel trailers. Six other homes were damaged. Firefighters were able to save an estimated 225 homes in the area of the fire, authorities said. The fire, while still expanding, was no longer an immediate threat to homes. "There is no threat to homes or to the population at this time," said T.J. Johannsen, a fire information officer. An evacuation order for the Conastoga Hills subdivision near the Skeleton blaze was lifted late on Sunday, but the Sundance subdivision remained closed on Monday. To help those displaced by the fire, the Red Cross has set up an evacuation centre at a local high school. In northern Washington state, the Timberline complex fires had consumed 10,000 acres (4,000 hectares) of timber and brush. Fires were also reported scorching wilderness areas in Nevada, Idaho, Montana, Utah and Wyoming. In California, crews continued to battle a major fire burning within Yosemite National Park and the Stanislaus National Forest. The fire has scorched 37,200 acres (15,050 hectares) and was 45 percent contained on Monday. So far, $10.5 million has been spent fighting the blaze. "We're slowly getting the upper hand on this fire," David Witt, fire information officer with the U.S. Forest Service, said of the Yosemite fire. Late Sunday, authorities in northern California said nearly 3,000 firefighters had fully contained the so-called Fork fire about 100 miles (160 km) north of San Francisco. The Fork fire had charred almost 83,000 acres (33,590 hectares). 3415 !GCAT !GPOL !GVOTE Republican presidential candidate Bob Dole began a working vacation on Monday in Santa Barbara, relaxing in a secluded cottage on the grounds of the luxurious Biltmore hotel. Tentative plans call for him to remain here until late on Thursday -- the final day of the Democratic Convention, Campaigning on enemy turf, as Dole did in Chicago just before the opposing party's convention, defies political custom, while going on vacation during the other team's pep rally was much more in keeping with tradition. After a grueling cross-country campaign trip on Sunday that included a speech in suburban Chicago accusing President Bill Clinton of "putting up the white flag" in the war on drugs, the sun-worshipping Dole had no public events planned on Monday. Aides said he might may make a brief appearance later in the day with his wife Elizabeth but he may forego even the valued "photo op" and enjoy a peaceful day by a pool. He had some meetings scheduled with advisers this week and planned a few local appearances later during this working vacation. Dole has a condominium in sunny Bal Harbour, Florida, where he vacationed after wrapping up his party's nomination in the primaries last spring. But southern California also has plenty of sun and surf, and since recent polls showed the state may not be quite as "safe" in Clinton's column as previously thought, its 54 electoral votes were as alluring to Dole as its sparkling beaches. 3416 !GCAT !GPOL !GVOTE First lady Hillary Rodham Clinton stood her ground on Monday, defending both herself and her husband to rousing cheers during a string of high-profile appearances at the Democratic National Convention. "What a way to start the week," she told the Arkansas delegation which gave the first lady a standing ovation lasting several minutes. She began the day with an early morning appearance on CBS television during which she defended President Bill Clinton's decision to sign welfare reform legislation into law -- a subject she did not bring up again in subsequent speeches. At a women's caucus event she joked about her imaginary conversations with the late first lady Eleanor Roosevelt while speaking of Jane Addams, the pioneering Chicago social worker. Addams "was a Republican, but the kind we used to have more of -- a progressive Republican," Clinton said. "Eleanor Roosevelt liked her. I know that because I've had conversations about it." She praised her husband as a man with the courage to stand up to special interests. "Finally we have a president who stands up to the NRA (National Rifle Association). Finally we have a president who stands up to the tobacco lobby," she said. "Finally we have a president who just doesn't talk tough about crime but does something about it, putting 100,000 policeman on the the streets. Finally we have a president who insures that a woman's right to choose is her right," she said. She told the Arkansas delegation that the same qualities they saw in her husband as governor of that state for more than a decade are the ones that warrant his re-election to the White House. "Everyone is aware of what Bill Clinton has done and will do," she said. "Bill needs another four years to complete the plan for a stronger country and a better future." "You know why Bill Clinton should be re-elected," she said. "You know better than anyone else. There is nothing new at all. We see the same man with the same committments." At a meeting of the Connecticut delegation, Sen. Chris Dodd, who also serves as party chairman, introduced the first lady by referring obliquely to attacks made on her during the Republican convention in San Diego. Dodd referred to Republican presidential nominee Bob Dole's mocking of the first lady's book "It Takes a Village" by saying Dole should limit his comments to books he's actually read. "Hillary Rodham Clinton has more decency, more honour and more integrity than all of her self-appointed critics combined," he said. "People believe we are fighting on behalf of their interests and no one articulates this better than Hillary Rodham Clinton," Dodd said. 3417 !GCAT !GDEF !GDIP U.S. defense officials on Monday rejected China's request to cancel a planned sale of Stinger anti-aircraft missiles and other arms to Taiwan and insisted the deal would go through. "The sale will go ahead. We don't anticipate any problems from Congress," said an official who requested anonymity. The official was responding to a statement on Monday by a Chinese Foreign Ministry spokesman urging the United States to cancel the sale if it wished "to prevent creating new damage to Sino-U.S. relations." The Pentagon last week said Taiwan wanted to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stingers, 96 jeep-like Humvee vehicles and 500 rounds of .50 calibre ammunition for an estimated $420 million. The U.S. Congress now has 30 days to either reject the sale or allow it to go through. Defense officials told Reuters they expected the sale to be completed. The United States officially recognizes only one Chinese government, based in Beijing, and has agreed to reduce weapons sales to Taiwan. But Washington has continued to sell defensive arms to Taipei's military. Beijing has regarded Taiwan as a renegade province since the end of the civil war in 1949. It opposes the sale of weapons to the island by any country. 3418 !GCAT !GPOL !GVOTE No more mild-mannered and meek Al Gore, the vice president and likely heir apparent to President Bill Clinton, emerged on Monday as the new Democratic attack dog leading a front-line assault on Bob Dole and House Speaker Newt Gingrich. While Clinton takes a train trip to the Democratic Convention that will renominate him on Wednesday for a second term, Gore is the bright star in the convention city now. Crowds anxiously wait for his appearances, thrusting out hands for him to grip as they scream "12 more years" -- a wishful hope to eight years of Gore after a Clinton re-election. Over a 15-hour span from Sunday evening to Monday morning, so many people jammed Gore events that the fire marshal stopped members of Congress, reporters and others from entering a pro-Israel rally and a meeting of the New York delegation. In his appearances, the often stiff and wooden Gore seemed transformed into a new energetic, gesturing "pol" as he ripped into Republican presidential nominee Dole and Gingrich, who has emerged as the favorite right-wing foil of Democrats. Gore told a roaring labor rally of about 1,000 union workers that Dole and Gingrich were the virtual personifaction of evil, without even mentioning that former Housing Secretary Jack Kemp is Dole's running mate. "With equal measures of ignorance and audacity this two-headed monster of Dole and Gingrich has been launching an all out assault on decades of progress of behalf of working men and women," Gore said to whoops of "12 more years." "They want to drive you out of politics and they can't," he added. "They want to silence your voices in elections." At a downtown hotel Monday, the 48-year-old Gore gave Wisconsin delegates a taste again of the new Gore. "I want you to ask this question. What would Wisconsin face if the same extremist coalition, the Gingrich/Dole Congress, also controlled the executive branch?" Gore said. Noting the next presidential term will probably see two or three Supreme Court justice nominations, he warned, "Their extremist agenda would come out of the Gingrich Congress, into and through the Dole White House, down through the Supreme Court." He painted a scene of horrors he saw if Republicans controlled the White House and the Congress they hold now. "Our personal and religious liberties would be at risk. Medicare would be at risk of withering on the vine. Medicaid would be at risk of being taken away from poor children. Education would be at risk. The environment would be at risk from the polluters that control that coalition," he said. His new style mixed an assault on Republicans with what he sees as "productive opportunity, a vision for the future that lifts up working families, that builds Wisconsin stronger, that builds America stronger. With your help we can re-elect Bill Clinton." Dole's tax cut plans were called "deja-voodoo economics .... It's a warmed-over plan that failed and drove our economy into a ditch. We got burned once and we won't let that happen to our nation again." Gore ridiculed Dole's defense of the tobacco industry, praised Clinton for "courage" in advancing regulations of it. To the delegates of Wisconsin, a leading dairy state, Gore had the right audience in poking fun at Dole's comparison to addiction to tobacco to those who can't tolerate milk. "Some people say milk is bad for you," Gore said as Wisconsin delegates held aloft a plastic inflated cow. He praised Clinton for vetoing the Republican Congress' attempt to repeal parts of the Clean Air Act, and criticized Republicans for "slashing money to combat drugs in schools." "The choice has never been starker, the stakes today have never been higher," Gore said. "We're not going to let them get away with that." 3419 !GCAT !GDEF The first group of women at The Citadel started class on Monday and were off to a good start, officials at the military college said. The new cadets, who include four women, wore the standard physical training clothes of navy T-shirts and shorts but were breaking in their dress uniform patent leather shoes as they learned military posture and how to address upper classmen. "The women seem to be doing fine, and so do the men," Brig. Gen. Clifton Poole, acting president of the college, told reporters. The Citadel dropped its 153-year-old all-male policy this summer after the U.S. Supreme Court said a similar rule at Virginia Military Institution, the nation's only other state-funded all-male school, was unconstitutional. Last year, one woman, Shannon Faulkner, was admitted to The Citadel under a federal court order but dropped out after a week, citing stress and isolation. The four women and 581 men in The Citadel's first truly coeducational class started the day at 5:20 a.m. on Monday with reveille. "In the past we were single gender. I wish we were still single gender, but the law of the land is we cannot continue this path," Poole said. "What we're focusing on now is trying to focus our energy on making the new role successful." By noon the new cadets had been addressed by the commandant and regimental commander and visited the cadet store, tailor shop and barber shop. The women -- Petra Lovetinska, Nancy Mace, Jeanie Mentavlos and Kim Messer -- did not get the traditional cut given to knobs -- the new students so dubbed because of their shaved heads, nor was it a standard military cut. Instead, they got a haircut similar to a man's crew cut. "The basic standards of the hair cut is off the face, off the shoulders, off the collar," Poole said. The Citadel went through a "painstaking" procedure to assure that the female cadets receive female haircuts, designed with the assistance of a local hair salon, said Col. Joseph Trez, commandant of cadets. The media were prohibited from interviewing new cadets but some upperclassmen said they were surprised at how short the women had to cut their hair. 3420 !GCAT !GPOL !GPRO !GVOTE The highlights of the first day of the Democratic convention on Monday were expected to feature a mix of party leaders and people who have overcome adversity. Among the latter were gun control advocate Sarah Brady and actor Christopher Reeve and the politicians included Rep. Richard Gephardt and Sen. Thomas Daschle. Here are thumbnail profiles of the convention's key Monday speakers. Sarah Brady -- The nation's toughest gun control law is named after Ronald Reagan's press secretary James Brady but it was his wife who was the major force behind its passage. As head of Handgun Control Inc., Sarah Brady, 54, campaigned nonstop for tough gun control in the years following the shooting of her husband and then President Reagan in 1981. Her reward was the passage in 1993 of the "Brady Bill" which requires a mandatory five-day waiting period for purchase of handguns and also mandates background checks for would-be gun purchasers. Reagan recovered fully from his wounds but Brady, who was close to death after being shot by John Hinckley Jr., suffered serious brain damage. Sarah was Brady's second wife and they have a son, James Scott Brady Jr. Before the assassination attempt, she had worked for Republican congressmen and for the Republican Party. Christopher Reeve -- Reeve was best known for playing the comic book hero Superman in four movies but his greatest heroics came in real life. Reeve, an accomplished rider who owned several horses, suffered multiple injuries including two shattered neck vertebrae when he was thrown from his horse at an equestrian event in Culpepper, Virginia, on May 27, 1995. Almost entirely paralyzed, Reeve underwent extensive surgery to fuse the vertebrae to the base of the skull and prevent any further damage to his spine. That allowed him to be moved to a semi-upright position. Over time he regained the power of speech, so much so that he was asked to address the opening night of the Democratic National Convention. Reeve, 43, was classically trained as an actor but became the prototypical handsome leading man. He performed in summer stock and soap operas before being plucked as an almost unknown to play the lead in "Superman" and three sequels. Richard Gephardt -- Gephardt, House Democratic leader, is a politician with a "Mr Clean" reputation who sought the presidency eight years ago and is widely believed to still have ambitions for the job. Gephardt, 55, the son of a milkman from a working class district of St. Louis, is a consummate congressional insider, sufficiently skilled in compromise and the ways of the legislature to manage the often-unruly House Democrats. A former lawyer, he was in the front line of President Bill Clinton's battle with the Republican-led Congress over the budget but has opposed the president's decision to sign the Republican-written welfare reform bill. He advocated tough action against foreign countries to cut U.S. trade deficits but sometimes been out of step with the party's liberal wing. He was an opponent of abortion until 1986 and voted for President Ronald Reagan's big tax cut bill. Gephardt, a red-haired square-jawed man, is a less than fiery orator. His 1988 bid for the Democratic nomination only took off after he recreated himself as a firebreathing reformer of the establishment, standing up for blue collar workers and farmers. Tom Daschle -- Daschle, 48, was largely unknown outside Washington and his state of South Dakota when he surprisingly beat more prominent rivals to become Senate Democratic leader after the party lost its majority to the Republicans in 1994. A mild-mannered and youthful man who rose rapidly after entering the Senate in 1987, he presented himself as a Midwest moderate, as a Democratic winner in a Republican state able to unite Senate factions. Concern that he might be steamrollered by the vastly more experienced Republican leader Bob Dole was dispelled when he showed a tough edge, outmaneuvering Dole in a wrangle over scrapping a gas tax and raising the federal minimum wage. In his early Senate years he was seen as a "prairie populist", working on legislation protecting farmers' prices and also on compensating veterans sickened by Agent Orange defoliant spraying in the Vietnam War. Daschle was a key player in President Bill Clinton's failed attempt at sweeping healthcare changes but when he became minority leader he declared he would be no water-carrier for the White House. He has made clear he opposed Clinton's signing of the Republican-initiated welfare reform bill. He has spent his adult life in politics, coming to Congress as an aide in 1972 after three years in the Air Force and then being elected to the House of Representatives himself in 1978. 3421 !E41 !ECAT !GCAT !GJOB !GPOL !GVOTE !GWELF President Bill Clinton is set to unveil a major jobs programme this week to help move people from welfare to work, Housing and Urban Development Secretary Henry Cisneros said on Monday. "You're going to see within a few days ... a presidential announcement on a major jobs progam to focus on the jobs that will be needed as people come off of welfare," Cisneros told Reuters during the Democratic Party's national convention. He said the programme would include tax incentives and stepped-up government assistance to help ensure that the controversial welfare reform legislation that Clinton signed last week works. Many of Clinton's fellow Democrats and the party's traditional allies have attacked the president over the measure, charging that it will throw thousands of people off of welfare without giving them a chance to get work. The legislation, which Clinton himself said was flawed, fulfils the president's 1992 election-year pledge to "end welfare as we know it" by limiting eligibility for government help and ending direct federal aid for poor children. "When we subtitute jobs and work for the dependency associated with welfare, we change the underlying dynamics of our communities," Cisneros said. The new jobs programme, which Clinton will likely unveil on Thursday during his speech accepting his party's nomination as its presidential candidate in the Nov. 5 election, will include tax incentives to encourage companies to hire people leaving welfare. "It's going to be more than a tax incentive," Cisneros added. "It's also going to be ... actual dollars, pledging assistance to communities." He said the programme will initially focus on helping enterprise communities and empowerment zones in inner cities and depressed rural areas but then will be expanded. In an interview with CNN television on Sunday, Clinton signalled out measures to make welfare refrom work as one of his top priorities for a second term. "My first priority is education," he said. "My second priority is devising ways to move people from welfare to work ... and creating incentives to focus on the inner cities and the isolated rural areas which have been left behind." 3422 !GCAT !GDEF !GDIS !GENV Investigators at the Army's chemical weapons incinerator near Tooele, Utah, searched on Monday for the source of a small nerve gas leak that halted weapons destruction over the weekend, officials said. The facility, 50 miles (80 km) southwest of Salt Lake City, will remain closed until the problem is found and corrected, Army spokesman Jeff Lindblad said. A special Army evaluation team from Aberdeen Proving Ground in Maryland will arrive at Tooele on Monday and begin investigating on Tuesday, Lindblad said. Workers detected the leak on Saturday afternoon during a routine check of charcoal air filters attached to an entryway. Lindblad did not have an exact measurement of the nerve gas leak, but said it was only trace amounts -- small enough for a worker to be safe in the area without a mask. "You're talking about molecules," he said. The leak occurred during the process of draining the agent from the rockets and cutting them up for incineration. "Anytime you cut a rocket, you're going to have a little bit of vapor come out," Lindblad said, adding that Army planners had anticipated such a leak would occur during the three- to four-month testing period. He said the Army experienced similar problems at its pilot incinerator on Johnston Atoll in the Pacific Ocean and consequently installed the detection filters at Tooele. Lawyers for environmentalists who unsuccessfully opposed the Tooele incinerator in federal court had argued the Army's plans did not sufficiently correct the problems at Johnston Atoll. The Army and its subcontractor, E.G.& G. Inc.'s (EGG. N) E.G.&G. Defense Materials Inc., began trial burns of nerve gas-filled M-55 rockets on Thursday and had incinerated 205 rockets before Saturday's shutdown. About 44 percent of the nation's chemical weapons stockpile is housed at Tooele. Smaller caches of chemical weapons are stored at seven other locations around the country, and the Army plans similar incinerators at each. Congress has mandated all chemical weapons incineration be completed by the year 2004. 3423 !GCAT !GODD !GPOL Teresa Ruhl insists she isn't a fanatic. Fanatics think about only one thing, Ruhl says, but she thinks about two: Elvis Presley and Democratic politics. A Democratic convention delegate part-time but full-time Elvis fan, Ruhl is the Democratic Party collector queen who says her Elvis memorabilia is worth a cool million dollars at least. "I'm the biggest Elvis fan and collector at this convention," said Ruhl of Lancaster, Pennsylvania, a perky mother of three children and a 4-year-old grandson "who loves Elvis." The 54-year-old Ruhl frankly admits her heart is torn between President Bill Clinton and Elvis, someone she has adored since she was 13 and has not stopped loving since. "I come from an Italian family where girls weren't supposed to do anything," she said. "So as a teen, I stayed in my room with my Elvis records," she said dreamily, with Clinton jewelry glistening from her blouse adorned with a Hillary Rodham Clinton fan club pin. Ruhl is a walking encyclopaedia of lore about the singer, who died in 1977. Two of her three bedrooms in her home -- her children are now grown -- are devoted to her Elvis memorabilia. Four years ago when others in the Pennsylvania delegation were rooting for Sen. Tom Harkin of Iowa, as the Democratic presidential nominatee, Ruhl came out for Clinton. "Clinton is an Elvis fan," said Ruhl, a former seamstress who is now a labour union employee. She says her husband Richard is a labourer who puts up with her Elvis compulsion. Ruhl never misses an annual trek to the Elvis home -- Graceland -- in Memphis, Tennessee, for the anniveraries of his birth and death. She also regularly goes to his birth place in Tupelo, Mississippi, and attends lectures devoted to Elvis. Ruhl has locks of Elvis' hair "notarized by his barber," water she scooped from Presley's swimming pool, one of his shirts, a bread and butter dish he used himself, and one of his ashtrays among thousands of other bits of memorabilia. Ruhl, a member of the Democratic Platform Committee, has 192 computer pages cataloguing her collection. There are first-day Elvis stamp and letter collections mailed to her from every state and from around the world where other countries have also issued Elvis stamps. Her Elvis record collection alone numbers more than 400 albums; she has some 200 first hardback editions of books about her hero, fan magazines from 1954, when she first became enthralled with "The King." She admitted spending at least $75,000 of the family's income on her collection. "It never came from household money," she insisted. "It's worth a million easy." But Ruhl said her collection is priceless and she never sells anything. Her will states that if her children do not want the Elvis collection, it will go to various hospitals and charities, including one named for Presley. Unlike some Elvis fans, however, she no longer expects to see her idol in person. "Elvis is dead," she admitted. 3424 !GCAT !GENV !GPOL More than two million Hispanics live in Florida and their numbers were growing at a faster rate than the state's total population, according to a University of Florida study released on Monday. More than half of Florida's Hispanic population, about 1.1 million, live in Miami's Dade County, the study found. "If past trends continue, Florida's Hispanic population will grow well into the future at a rate faster than the state's total population," said June Nogle, a demographer with the university's Bureau of Economic and Business Research. "This may result in demands for social services that are different than in the past. For example, bilingual education, especially with Hispanics being younger and more likely to have children in school than some other groups," she said. Florida had a population of 14.1 million in 1995, 14 percent of which was Hispanic. In 1990, the state's Hispanic population was 12 percent. The vast majority of Hispanics living in the state were under age 65 and almost one-third were under of 20, the study found. "Because the Hispanic population is much younger than the rest of the state, this creates a strong supply of young people to fill jobs that otherwise might go unfilled," Nogle said. "That is good news for Florida, which, because of its large number of retirees, is traditionally thought to be fairly elderly compared to other states." The other Florida areas with the largest numbers of Hispanics include Fort Lauderdale, Tampa, Orlando and Palm Beach. California has the largest Hispanic population in the United States, followed by Texas, New York and Florida. 3425 !GCAT !GCRIM !GVIO By Gail Appleson, U.S. Law Correspondent A plot by three militant Moslems to bomb 12 U.S. passenger jets last year was very real and the defendants had the know-how and will to carry it out, a federal prosecutor said on Monday. In closing arguments at the trial of the three accused plotters, Assistant U.S. Attorney Dietrich Snell told a Manhattan federal jury that if a fire had not broken out in the Philippine apartment being used to make the bombs, the scheme would have been executed. "The defendants' plan was very real. They had the material, they had the knowhow and they had the determination to carry out the plan with deadly precision," he said. The three have been on trial since May for their alleged plan to destroy the planes within a 48-hour period last year and kill about 4,000 passengers as they returned to the United States from the Far East. The government's presentation of evidence entered a crucial phase last month at about the same time as the fatal TWA explosion over Long Island, New York. All 230 passengers and crew on board were killed. Reports speculating that the defendants might have some connection to the explosion caused U.S. District Judge Kevin Duffy to question jurors as to whether their judgment had been affected by the disaster. The government's evidence included a laptop computer seized from a Manila apartment shared by two of the defendants that held files calling the scheme "Bojinka." It contained flight schedules and code names for the defendants who would carry out the bombings aboard Delta, Northwest and United planes bound for the United States from the Far East. The schedules were for flights with stopovers before they reached the United States. A letter in the computer said the purpose of the attacks was to punish the United States for its support of Israel. Snell said the word "Bojinka" should have become part of the jurors' vocabulary, "synonymous with one of the most hideous crimes ... ever conceived." The alleged ringleader of the airline bombing scheme is Ramzi Ahmed Yousef, who will be tried again this year on charges that he masterminded the 1993 World Trade Centre bombing that killed six people and injured more than 1,000. "He was the architect of the whole scheme. He was the chief recruiter," Snell said. The other defendants are Abdul Hakim Murad and Wali Khan Amin Shah. Yousef is also charged with placing a bomb on a Philippine Airlines flight from Manila to Tokyo on Dec. 11, 1994, as a trial run. The bomb exploded under the seat of a Japanese passenger, killing him and injuring 10 other people. The flight originated in Manila and Yousef allegedly left the plane during a stopover. Prosecutors alleged that he mixed the bomb in a restroom during the first leg of the flight and placed it under his seat with the timer set to detonate the bomb after the plane left for Toyko. The plot to bomb the airliners was uncovered on Jan. 6, 1995, when a fire broke out in a Manila apartment where Yousef and Murad were mixing chemicals. Philippine police found the laptop computer during their search of the apartment. 3426 !GCAT !GHEA Low-tech solutions such as counselling and free condoms have a good chance of keeping the heterosexual partners of AIDS patients from getting infected, the National Institutes of Health reported on Monday. Citing a study of 475 Haitian couples in which one partner was infected with the AIDS virus and the other was not, the institutes found that nearly half of the sexually active couples who got counselling and condoms practised safe sex. In addition, the rate of new infections with HIV, the virus that causes AIDS, among couples who consistently used condoms was one-seventh as high as it was among those who did not, according to the National Institute of Allergy and Infectious Diseases, part of the NIH. 3427 !GCAT !GCRIM A 13-year-old Dallas boy has been charged with murdering his adoptive mother over the weekend, police said on Monday. Margaret McCullough, 55, was found dead in her home on Saturday with gunshot wounds to the head. Police, who at first thought her son had been kidnapped, found him on Sunday with a friend in his mother's car in Oklahoma and arrested him. A shotgun and a .357 handgun were found in the car. A police spokesman said the boy was being questioned. "They are talking to him now about the motive and everything else." McCullough had adopted the boy, who was the grandson of her late husband, shortly after his birth but neighbours said they often had loud arguments. 3428 !GCAT !GPOL !GVOTE Democrats began a four-day celebration on Monday aimed at grabbing the attention of middle ground voters and making Bill Clinton the party's first president to win re-election in more than half a century. The first convention session was scheduled to begin at 5 P.M. EDT (2100 GMT), and was to feature a tribute to Ron Brown, the commerce secretary and former party chairman killed earlier this year in a Balkan plane crash, and an appearance by actor Christopher Reeve, star of the Superman movies who was paralyzed in a horse riding accident. Also picked to speak were gun control advocate Sarah Brady, whose husband was shot during an assassination attempt on President Ronald Reagan in 1981. The convention ends on Thursday when the 50-year-old Clinton formally accepts the nomination to run against his Republican challenger, 73-year-old Bob Dole of Kansas. Throughout the week convention organizers planned to present a portrait of "real people" and fresh faces, highlighting the problems and worries of average citizens. Party leaders said it would be a message designed to connect solidly with middle class families, the largely white suburb dwellers most likely to vote and who may hold the key to who controls the White House for the rest of the century. Clinton chugged toward the convention city on a slow train stopping from town to town to campaign through the vote-rich Midwest. But he was on a fast track in some of the polls. A CNN poll of registered voters gave Clinton a 12-point lead over Dole -- a boost of seven points from a week ago when the Republicans presented a polished new face at their San Diego convention and hammered away at Clinton's trustworthiness while trumpeting their plan for a 15 percent income tax cut. An ABC poll of likely voters showed Clinton leading Dole 47 to 42 percent, with Texas billionaire Ross Perot's third party effort trailing at 7 percent. Dole was spending the convention week resting at Santa Barbara, California, but planned a number of announcements during the week to keep his name in the news. In Portland, Oregon, Sunday evening he rejoined running mate Jack Kemp and pressed his attack on Clinton, saying the president had engineered a "rapid response" to Dole's own speeches but lacked a rapid response on drug abuse or a host of other problems facing the country. Clinton's train trip took him on Monday to Ohio, a key swing state in the November election, where he called for a ban on selling handguns to people convicted of domestic violence. Saying he strongly believed in the right for most Americans to own guns, Clinton said "those who threaten the safety of others" like wife-beaters and child abusers "do not deserve our trust." In the coming days, Clinton planned to highlight other issues which he believed where he had strong public support. Before arriving in Chicago on Wednesday Clinton planned major announcements on education and the environment. On Sunday he criticized Dole's tax cut proposal, saying it would "blow a hole" in the budget and bankrupt social programs. In a CNN interview on Sunday evening he angrily blasted Republicans for hounding many of his staff and associates over the Whitewater affair. "I think it is outrageous that these middle class people have had their lives wrecked by pure, naked raw politics," Clinton said angrily. While Clinton rode the rails, the 4,329 convention delegates partied. State delegation parties and receptions were spread across the third largest U.S. city in museums, restaurants, railroad stations and historic sites. The Democrats have a hard act to follow after Republicans produced a slick, well-orchestrated display of unity and harmony at their San Diego convention -- and they are battling a last summer wave of weariness among television viewers who clicked their ways to other programs or found other pursuits in massive numbers during the Republican event. The Chicago gathering is the first held in the city by either major party in 28 years. When Democrats last met here in 1968 both the party and the city were ripped apart by dissent over the Vietnam War as police bashed the demonstrators. Hubert Humphrey left the city that year with a damaged nomination as a result and lost the election that year to Richard Nixon. But some of the anger persists. CNN on Monday morning interviewed peace activist David Dellinger, who was at the heart of the street protests in 1968, along with a former Chicago policeman, who told the network he would still rather not be standing anywhere near Dellinger 28 years later. 3429 !C12 !C34 !CCAT !GCAT !GCRIM Sequa Corp's Chromalloy subsidiary said on Monday its antitrust lawsuit against United Technologies Corp and its jet aircraft unit begins today in Bexar County District Court in Texas. Chromalloy contends that United Technologies's Pratt & Whitney has been engaged in a scheme to prevent Sequa from providing parts for Pratt & Whitney commercial jet engines, the company said. Chromalloy said United Technologies has caused hundreds of millions of dollars in damages. United Technologies was not immediately available for comment. Pratt & Whitney spokesman Larry Churchill said the claims have no merit and the company does not expect any adverse financial effects from the trial result. 3430 !C12 !C42 !CCAT !E41 !ECAT !GCAT !GCRIM !GJOB !GREL A Massachusetts official said he planned to file legislation on Monday to protect employees who refused to work over Christmas because of religious beliefs. State Attorney General Scott Harshbarger said he intended to file a bill with the legislature to "prevent working men and women in Massachusetts from being forced to choose between their deeply held religious beliefs and their job." His announcement came after the Massachusetts Supreme Judicial Court last Tuesday declared unconstitutional a 23-year old state law making it illegal for companies to require their employees to work on religious holidays. The court ruled the law protected members of established religions but ignored those who did not belong to any organised church. The decision dismissed a suit brought by two Roman Catholic women against the Raynham-Taunton Greyhound Racetrack, which fired the clerks for refusing to work on Christmas Day, 1992. On Dec. 18 1992 Kathleen Pielech and Patricia Reed were told they had to work the night of Dec. 25. They did not turn up and were fired. They sued, claiming their Catholic beliefs prevented them from working Christmas. The court found in favour of their employer. 3431 !GCAT !GCRIM !GDIP A Paris court on Monday barred the expulsion of three African immigrants who staged a 52-day hunger strike for the right to stay in France as immigrant leaders said they hoped their cause would become a national movement. Riot police ringed the administrative court as it considered appeals against expulsion orders for some 80 of the 210 immigrants forcibly ejected on Friday from a Paris church that they had occupied in protest at tough French immigration laws. Lawyer Anne Bremaud said the court ruled that the three men -- among a total of 10 Africans who had staged the hunger strike -- could not be deported in view of their health. Police said that only one of the 10 would qualify for residence, but the government has said it would not expel anyone who was seriously ill. The 10 hunger strikers, most of them from Mali, called off their fast on Sunday after police released them. "They have started taking mashed food as they are unable to eat any solid food. They are very tired," said their spokesman, Doro Traore. Supporters of the Africans' cause have scheduled a major demonstration in Paris on Wednesday. The Africans themselves are now calling for a second protest on September 18 in front of the headquarters of the Council of Europe in the eastern French city of Strasbourg. "We have the French people's support," said Ababakar Diop, who had acted as a spokesman for the protesting Africans when they were occupying the Saint-Bernard church in the capital's multi-ethnic Goutte d'Or district. "Much of French public opinion is today favourable to our cause. We say that this is a victory," added Madjiguene Cisse, a spokeswoman for the Africans. An IPSOS opinion poll for the daily Le Monde showed voters evenly divided in their views of the government's policy of strictly enforcing immigration laws while reviewing each protester's case on an individual basis on humanitarian grounds. But 46 percent said they sympathised with the protesting immigrants while 36 percent were hostile, according to the poll. Most of the protesters were resting after moving their headquarters to a disused ammunition factory in the eastern Vincennes suburb. Some were enjoying the sunshine in the Vincennes park after weeks holed up in the Saint-Bernard church. Lawyers managed to get most protesters released at the weekend in a legal battle to keep them in the country, prompting some media to accuse the government of confusion. "The Great Muddle," the left-wing daily Liberation said in a headline of the confusion about the legality of expulsion orders. Traore said all but 15 of the protesters were free and in the care of human rights groups. Four were deported to Senegal, Mali and Zaire on a French military plane at the weekend. Three others were jailed for two to three months, and a few were still in custody. Interior Minister Jean-Louis Debre had said 30 to 40 percent of the protesters would be allowed to stay in France. His adviser on immigration, Jean-Claude Barreau, later told Liberation that as many as two-thirds might end up with residency papers. 3432 !E51 !E512 !ECAT !GCAT !GDIP Israeli, Egyptian and U.S. officials met in Paris on Monday to discuss reviving the Middle East peace process and preparations for a forthcoming economic conference in Cairo, a United States embassy spokesman said. The spokesman said U.S. envoy Dennis Ross met officials of Israel and Egypt. However, an Israeli embassy spokeswoman said she had not been informed of any meeting. As far as she knew Israeli official Dore Gold, who was to represent Israel at the talks, had not yet arrived in France. Officials of all three embassies said the highly contacts were being arranged directly by their capitals, effectively bypassing the missions. According to the Israeli spokeswoman, Gold, an adviser to Israeli Prime Minister Benjamin Netanyahu, was to have participated in the talks with Ross along with Osama el-Baz, one of Egyptian President Hosni Mubarak's advisers. The U.S. spokesman said that another Israeli had apparently attended the talks in Gold's place. He said he had no information on which official or officials had represented Israel or Egypt at the talks or even where or precisely when they had taken place. Ross earlier in the day held long-planned consultations with French officials on the situation in the Middle East, the U.S. spokesman added. A French Foreign Ministry spokesman said Ross met the French ministry's Secretary-General Denis Bauchard to review the Middle East peace process and tighten coordination between the two countries. "As the peace process goes through a delicate period, it seems important that the Americans and the French, who are very active in the Middle East, may be able to exchange views regularly to help the quest for peace," ministry spokesman Jacques Rummmelhardt told reporters. President Mubarak showed signs of reluctance about the Cairo conference last week, saying many Middle East states would not attend unless Israel ensured the peace process moved forward. Netanyahu, apparently shaken by Mubarak's suggestion that he might cancel the summit, later phoned the Egyptian president to tell him that peace talks with the Palestine Liberation Organisation would resume soon. Netanyahu, elected in May, is opposed to exchanging occupied Arab land for peace, the bedrock of the peace policy of the Labour government he replaced. 3433 !GCAT !GDIP !GVIO Yemen said on Monday it was pulling out of French-led mediation efforts to resolve its dispute with Eritrea over a Red Sea island and vowed to force a withdrawal of Eritrean troops there. "There is a limit to our patience," vice-foreign minister Ghaleb Ali Jamil told RFI radio's Arabic service. "We have the right under Article 51 of the United Nations charter to use all means to defend ourselves and to defend our land." The article allows member states to defend themselves against armed attack. Yemen earlier this month threatened to take military action against Eritrea if mediation failed to defuse a crisis triggered by dispatch of Eritrean troops to the disputed Lesser Hanish island. Yemen said it sought a peaceful solution to the dispute over the islands near tanker routes at the Red Sea's southern entrance. The two countries fought briefly last December over the islands and then agreed in May to French arbitration. Jamil praised France's attempt to push negotiations but said they could be resumed only after Eritrea withdrew it troops. "(Yemen calls for) an embargo against Eritrea if this country does not withdraw today...as this behaviour represents a threat to shipping and security in the Red Sea," he said. Eritrea wrote to the United Nations saying Yemeni forces, travelling in boats, had fired at Eritrean troops last week. In its complaint, Eritrea said it had agreed to withdraw its units from the island "within a short time". But it said Yemen "reciprocated by irresponsible acts". Two fast boats had approached the island on August 19 and fired on Eritrean forces. "In the afternoon of the same day, more Yemeni troops using seven boats passed along the shores of the islands. In both instances our forces refrained from responding in similar manner," the letter from Eritrea's Foreign Ministry said. The president of the U.N. Security Council said earlier this month that Eritrea should withdraw immediately from the island. French mediator Francis Gutman, dispatched to Sanaa and Asmara with the blessing of U.N. Secretary-General Boutros Boutros-Ghali, said last weekend Eritrea had agreed to withdraw its forces so that arbitration procedures could take place. 3434 !E11 !E12 !E21 !E211 !ECAT !GCAT !GPOL The French are returning from their holidays in a depressed mood, disappointed by economic weakness and continued budget austerity which could lead to a difficult autumn for the government. According to a poll published in the Le Parisien newspaper on Monday, 54 percent of the French are pessimistic about "La Rentree" - the big return to work, school and politics. Strikes, poverty and job losses topped voters' worries, the CSA survey of 1,005 people showed. The poll also found that 78 percent of those polled expected troubles for the centre-right government when the summer holidays end. Of the people surveyed, 52 percent feared strikes and social unrest the most. Unions have vowed to challenge plans to cut spending by around 60 billion francs in real terms next year in a budget due to be unveiled in September. Around 7,000 civil service jobs face the axe as part of government initiatives to close the gap between spending and revenues and qualify for a European single currency from 1999. President Jacques Chirac on Sunday said he did not know whether there would be unrest after the summer break as threatened by unions, who say conditions are right to revive unrest to match a crippling 24-day wave of strikes in late 1995. But financial markets are uncertain and the franc, bonds and shares remain fragile due to worries about the reaction to France's 1997 austerity budget, due to be unveiled in September. Communist Party leader Robert Hue warned on Monday the spirit of last year's strikes, which brought France to a virtual standstill, was "still alive in hearts and minds". Economists are sceptical the budget -- marrying spending restraint with tax cuts -- will be enough to reach government's goal of a budget deficit of three percent of gross domestic product (GDP), needed to qualify for European monetary union. "Deficit-busting has the highest government priority but still more needs to be done," Smith Barney economists Paul Horne and Steven Englander said in a note to investors on Monday. A series of key dates starts on Tuesday with a meeting of the main teachers' unions. Some teachers' unions have already announced strikes over perceived government plans to cut 2,300 posts in education. On Wednesday the government has its first cabinet meeting after the summer break and a ministerial seminar on the budget. Louis Viannet, head of the Communist-led CGT union will hold a news conference the same day in which he is expected to warn the government against any attacks on the welfare system. On Friday August 30, the July unemployment figures are due. Unemployment, at record levels, remains a major thorn in the side of the government. But the level is not expected to fall any time soon. Juppe said on Sunday that around September 10 he would present both the 1997 budget and the social security financing plan as well as plans for a tax reform. As soon as September 11, the government could present the cabinet with the 1997 budget. Activists have planned protest meetings and news conferences to follow hard on the heels of the budget presentation. 3435 !GCAT !GDIP Chile introduced a Security Council resolution on Monday aimed at persuading Burundi factions to negotiate by threatening sanctions, and promising development aid if peace is achieved. Council members said there might be amendments to the Chilean plan, the first concrete steps offered in the Security Council, but that no one had objected to it outright. At the same time there has been no open support from the United States, whose special envoy to Burundi, Howard Wolpe, briefed council members individually on Monday on his efforts. The United States has been less critical than other council members of Major Pierre Buyoya, installed in a July 25 coup by the Tutsi-run army. The army overthrew the elected Hutu president, Sylvestre Ntibantunganya, who sought refuge in the U.S. ambassador's residence in Bujumbura and is still there. Parliament is suspended and political parties are banned. In a carrot and stick approach, the Chilean resolution, backed by Botswana, demands an immediate end to fighting and says all parties and factions should initiate negotiations with a view towards reaching a comprehensive agreement within 60 days after the resolution is adopted. The resolution would also impose an arms embargo as soon as it is adopted. Should the talks succeed, it says the United Nations would hold a conference to raise funds for reconstruction of the country, where more than 150,000 people have died in fighting over the past three years. But if the parties fail to make progress within 60 days, the draft resolution threatens "targeted measures" in the "political, military and diplomatic fields" aimed at the government and political leaders who encourage violence. The Security Council on Wednesday plans a public debate on the issue which will allow African leaders to speak. But no action will be taken then. The new rulers say they seized power to prevent genocide in Burundi between between minority Tutsis and ethnic Hutus, who make up around 85 percent of the population. East and Central African states agreed at a July 31 summit to impose sanctions on the landlocked country of about 5.6 million people and its immediate neighbours have done so. 3436 !GCAT !GCRIM Belgian detectives gained new support for their investigations into a widening child sex scandal when Justice Minister Stefaan De Clerck vowed nothing would stand in the way of a successful conclusion to the case. De Clerck on Monday tried to head off increasing public concern that the increasingly complex probe into the deaths of two eight-year-old girls, victims of a paedophile gang, might be cut short. "The investigation will continue with all possible means, without obstacles and without any intervention," De Clerck told a news conference. "I, like all the government, want us to get to the bottom of this case as quickly as possible." The two girls, Melissa Russo and Julie Lejeune, disappeared in June 1995 and were found dead just over a week ago. Chief suspect Marc Dutroux, 39, said they had starved to death and led police to their bodies buried in his garden. Two other girls, Laetitia Delhez, 14, and Sabine Dardenne, 12, were rescued from a dungeon in another of Dutroux' six houses. Dutroux, a convicted sex offender, has also admitted kidnapping two others -- An Marchal and Eefje Lambrecks, who were 19 and 17 respectively at the time of their disappearance a year ago. They are both still missing. Together with an associate Michel Lelievre, Dutroux has been charged with abduction and illegal imprisonment of children. Michelle Martin, Dutroux' second wife, has been charged as an accomplice and three men are facing charges of criminal association. One of these, Michael Diakostavrianos, is due to be formally charged on Tuesday. Investigators in the southern Belgian village of Neufchateau said on Monday they had made a 10th arrest in connection with their inquiries into the scandal which has horrified the nation and attracted international attention. Pierre Rochow, son of a scrap metal dealer, was arrested on charges of taking part in a criminal association concerning theft and receiving stolen goods. His arrest followed three others on Sunday related to a car and truck theft ring, including that of senior police detective, Georges Zicot. Dutroux has been linked with several people arrested for organised vehicle theft, and police now are investigating both this and the child sex scandal jointly. Police have seized more than 300 video tapes -- some featuring Dutroux -- magazines, childrens' clothing and drugs, alleged to have been used to pacify young victims. Searches resumed on Monday at Dutroux' house in the village of Sars-La-Buisierre where the bodies were found. They were led by Superintendent John Bennett, a British police officer who oversaw excavations in the so-called "House of Horrors" murder case in England two years ago, and involved the use of sophisticated radar imaging equipment. Meanwhile, the arrest of Chief Detective Zicot has added a new dimension to the scandal, fuelling speculation about how such activities escaped detection for so long. Newspapers and campaigners have questioned whether Dutroux might have enjoyed protection from high places. Justice Minister De Clerck has said he has no information to this effect. Belgian media have also expressed concern about possible political or judicial pressure being exerted in the investigation after comments made on Friday by the public prosecutor in charge, Michel Bourlet. Bourlet told Belgian television that he would successfully conclude the investigation "if I am allowed to". De Clerck insisted that "in this investigation he has not been hindered". The minister has however said that mistakes were indeed made during the investigation into the deaths of Russo and Lejeune, and he has promised a full "inquiry into the inquiry", including the possibility of disciplinary action. 3437 !E51 !E512 !ECAT !GCAT !GDIP Officials from the Iraqi State Oil Marketing Organization (SOMO) are expected to arrive in New York on Tuesday for talks this week on pricing mechanisms in the new oil-for-food deal. Diplomats said they would see the four overseers, independent experts from the United States, France, Russia and Norway, who will approve oil contracts on a day-to-day basis. The oil-for-food accord, signed on May 20 but not yet imlemented, requires a pricing formula to be used for term contract sales based on three regional benchmark crudes - North Sea Brent for Europe, West Texas Intermediate for the Americas and Dubai for the Middle and Far East. U.N. officials are still working to get monitors in place so the oil-for-food scheme can be implemented, presumably next month. The plan allows Iraq to sell $2 billion worth of crude over six months on a renewable basis to ease effects of sanctions imposed after Iraq invaded Kuwait in August 1990. Iraqi sources said that Riyadh al-Qaysi, an Iraqi deputy foreign minister, also would be in New York later this week, in advance of the Security Council's regular 60-day review of sanctions, scheduled for September 3. The sanctions will be not eased or lifted at the September 3 meeting. But council members will review Iraq's compliance with ridding itself of weapons of mass destruction, a key requirement for easing the embargoes. The oil-for-food plan is an exception to the blanket sanctions and will not be discussed on at that council meeting. 3438 !GCAT !GDIP !GPOL !GVIO U.N. Secretary-General Boutros Boutros-Ghali warned Liberian factions on Monday that the international community could easily pull out of the country if peace accords were not implemented. "I urge the faction leaders to remember the precedent of Somalia and hope they seize their opportunity to restore peace in their country," he said in a report to the Security Council. "For if they do not, the international community may have no choice but to disengage from Liberia." West African peacekeepers of the ECOMOG force have the task of overseeing implementation of the latest peace accord signed in Nigeria on Aug 17, which sets a timetable for disarmament by the end of January and elections on May 30. West African heads of state have threatened sanctions against individual faction leaders to ensure compliance. The United Nations deploys a small observer force, which recently was reduced from 93 to 10 military observers because of heavy fighting and looting in April and May. Boutros-Ghali said the operation, which expires on Aug 31, should be extended for another three months, adding that he would report to the council in mid-Oct on progress in the peace process. Meanwhile, he said he would send 24 more observers immediately, as well as experts on disarmament, elections, human rights and administration, not exceeding the current authorised strength of 160 U.N. personnel. He also urged Liberia's warring factions to return vehicles and other equipment they looted from the United Nations compound during the recent fighting. He said that only 11 of 489 vehicles stolen, and valued at about $8.3 million, have been recovered so far. 3439 !E12 !E21 !ECAT !G15 !G151 !G154 !GCAT !M13 !M132 !MCAT Bundesbank chief economist Otmar Issing on Monday warned that entry criteria for Europe's planned currency union must not be altered, speaking out in a smoldering debate on the issue among European leaders. "As we have said on many occasions, a softening of the convergence criteria is out of the question in our opinion," Issing told a group of bankers. In recent days Italian officials have stirred a long simmering debate on European Economic and Monetary Union (EMU) criteria by suggesting they should be renegotiated in light of Europe's sluggish economic growth and fiscal problems. Nations wishing to join the union at its planned starting date on January 1, 1999 must show their budget deficits are not exceeding three percent of gross domestic product while their total public debt does not exceed 60 percent of gross domestic product. But Issing rejected the calls for more lenient entry criteria suggesting instead that nations must go one step further and adopt another document to ensure lasting stability once the union is founded. Issing said it was also important to adopt a stability pact, currently being discussed by European leaders, which would impose automatic sanctions on members straying from the original targets. But commenting on speculation that countries may be let into EMU even if they exceed the prescribed targets, Issing said the stability pact could not be seen as a replacement for the original entry criteria. "We cannot get around implementing a stability pact but not as a replacement for the convergence criteria. The stability criteria must be observed," Issing said. A stability pact's sanctions were particularly important because the Maastricht Treaty, setting out the rules for the currency union, held no provisions to expel a nation for bad behaviour, Issing said. "Expulsion is not a planned option," Issing said, adding, "The economic cost of quitting EMU, disregarding the political ramifications, would be immense." He warned that Germany was currently in danger of missing both the debt and deficit criteria this year. "There is a danger that Germany will again clearly miss the three percent deficit criteria this year and recently it has also exceeded the 60 percent debt target," Issing said. --Frankfurt Newsroom, +49 69 756525 3440 !GCAT !GDIP !GVIO The United Nations on Monday said Eritrea had agreed to withdraw its troops soon from a small Red Sea island in an effort to resolve its dispute with Yemen. Ambassador Tono Eitel of Germany, this month's council president, said Eritrea had notified French mediators who are handling the dispute for the United Nations. Troop withdrawal is a precondition for arbitration. Both Eitel and U.N. chief spokeswoman Sylvana Foa said Eritrea promised to pull out in the "next two or three days." Foa said Yemen had been informed and was in agreement. The Security Council was expected to review the dispute over Lesser Hanish, an island near tanker routes in the Red Sea's southern entrance, again on Wednesday or Thursday, Eitel said, adding,"This is a welcome development." U.N. officials played down Yemen's comments, broadcast in Paris, earlier on Monday, in which its vice-foreign minister said his country was quitting mediation efforts and would use force if Eritrea did not withdraw its troops. "There is a limit to our patience," vice-foreign minister Ghaleb Ali Jamil told RFI radio's Arabic service. "We have the right under Article 51 of the United Nations charter to use all means to defend ourselves and to defend our land." The article allows member states to defend themselves against armed attack. The two countries fought briefly over the island last December and then asked the United Nations to mediate. Secretary-General Boutros Boutros-Ghali turned the negotiating process over to French diplomat Francis Gutman, who said this month that Eritrea had agreed to withdraw its forces so that arbitration could take place. Eritrea, in a letter to the United Nations written last week but released on Monday, said Yemeni forces, traveling in boats, had fired on Eritrean troops. It accused Yemen of conducting "irresponsible acts" on Aug. 19, contending two fast boats approached the island and fired on Eritrean forces. "In the afternoon of the same day, more Yemeni troops using seven boats passed along the shores of the islands. In both instances our forces refrained from responding in a similar manner," the letter from Eritrea's Foreign Ministry said. 3441 !GCAT !GCRIM Nothing will stop Belgian detectives plumbing the murky depths of a child sex scandal and bringing their investigation to a successful conclusion, Justice Minister Stefaan De Clerck vowed on Monday. De Clerck was heading off fears the increasingly complex investigation into the deaths of two eight-year-olds at the hands of a convicted sex offender might be cut short before the affair was completely unravelled. "The investigation will continue with all possible means, without obstacles and without any interventions," De Clerck told a news conference. "I, like all the government, want us to get to the bottom of this case as quickly as possible." Belgian media have expressed worries about possible political or judicial pressure being exerted in the investigation after comments made by the public prosecutor in charge, Michel Bourlet, last Friday. Bourlet told Belgian television that he would successfully conclude the investigation "if I am allowed to," and said he was talking from "past experience". "I can confirm that in this investigation he has not been hindered," De Clerck said. De Clerck has admitted however that mistakes were indeed made during the investigation into the deaths of young Melissa Russo and Julie Lejeune and has promised a full "inquiry into the inquiry" including the possibility of disciplinary action. Leaked police documents catalogue a high degree of police bungling, incompetence and indifference in the case. Vital information was either not passed on by investigators in one area to those in another, or if received, was not acted on. Lejeune and Russo, who disappeared in June 1995, were found dead just over a week ago. Chief suspect Marc Dutroux led police to their bodies buried in his garden. Dutroux has been charged with abducting two girls who were rescued from one of his houses and had been sexually abused. He has also admitted kidnapping two other girls -- An Marchal and Eefje Lambrecks -- who are still missing. Investigators have arrested nine other people since in connection with their inquiries into Dutroux. The media and campaigners have also questioned whether, given he remained undetected so long, Dutroux might have enjoyed protection from high places. De Clerck has said he has no information to this effect. The minister said a cabinet meeting on Friday was expected to adopt promised new measures on sex offenders. These include tougher rules on early release from jail, and a review of how offenders are followed while on conditional release. Dutroux, 39, was released for good behaviour in 1992 after serving only three years of a 13-year sentence for multiple child rape. 3442 !E12 !E21 !E211 !E212 !ECAT !G15 !G151 !G154 !GCAT Bundesbank chief economist Otmar Issing said on Monday that Germany was in danger of missing the debt and deficit criteria this year that are necessary to join Europe's planned monetary union. "There is a danger that Germany will again clearly miss the three percent deficit criteria this year and recently it has also exceeded the 60 percent debt target," Issing told a group of bankers. The Maastricht Treaty on European Economic and Monetary Union must not allow their budget deficits to exceed three percent of gross domestic product and total public debt must not exceed 60 percent of gross domestic product. -- Frankfurt Newsroom, +49 69 756525 3443 !E12 !ECAT !G15 !G151 !G154 !GCAT !M13 !M132 !MCAT Bundesbank chief economist Otmar Issing said on Monday that he was not in favour of any efforts to weaken the criteria for a single European currency as set out in the Maastricht Treaty. "As we have said on many occasions, a softening of the convergence criteria is out of the question in our opinion," Issing said. Issing said that it was important to adopt a stability pact that is under discussion by European leaders and the Bundesbank favoured automatic sanctions against EMU participants who strayed outside the Treaty's targets. But commenting on speculation that countries may be let into EMU even if they exceed the prescribed targets, Issing said the stability pact could not be seen as a replacement for the original entry criteria. "We cannot get around implementing a stability pact, but not as a replacement for the convergence criteria. The stability criteria must be observed," Issing said. Issing said the sanctions contained in a stability pact were important because there were no provisions in the Maastricht Treaty to expel a participant who was not meeting his obligations under the Treaty. "Expulsion is not a planned option," Issing told a group of bankers. "The economic cost of quitting EMU, disregarding the political ramifications, would be immense." --Frankfurt Newsroom, +49 69 756525 3444 !GCAT !GDIP !GVIO The United Nations said on Monday it expected Eritrea to withdraw its troops from a contested Red Sea island in the next two or three few days, thereby calming its dispute with Yemen. U.N. spokeswoman Sylvana Foa said Yemen had been notified and was in agreement. German Ambassador Tono Eitel, president of the Security Council, said Eritrea had made known its intention to withdraw shortly to French mediators who have been asked to handle the dispute for the United Nations. "This is a welcome development," Eitel said. Yemen said earlier it was pulling out of mediation efforts and would use force if Eritrea did not withdraw its troops from the disputed Lesser Hanish island near tanker routes at the Red Sea's southern entrance. The two countries fought briefly last December over the island and then asked the United Nations to mediate. French mediator Francis Gutman, who went to Sanaa and Asmara, said earlier this month that Eritrea had agreed to withdraw its forces so that arbitration procedures could take place. 3445 !GCAT !GCRIM French police have arrested a Bulgarian businessman suspected by Sofia of obtaining $6 million by fraud, police sources said on Monday. Ivo Nedialkov, aged 30 and former head of the East West International Holding Group which collapsed in 1994, was detained in the Riviera resort of Cannes on August 20. Nedialkov disappeared from Bulgaria in December 1994 after the collapse of his firm and arrived in Cannes in early 1996, where he rented a luxury villa. He had previously lived in Britain and Australia. The target of an international arrest warrant, he is suspected of selling fictitious shares to private banks and to individual investors. 3446 !GCAT !GDIS The bodies of five Japanese sailors killed by a gas leak aboard their trawler off Ireland were brought ashore at the southern port of Cork on Monday. Irish naval officers lined up at the dockside to observe a minutes' silence for the five men and place pink carnations on their bodies. The five died on Friday when freon gas from a refrigerating unit seeped into the engine room where they were working more than 200 miles off Ireland's western coast. Japan's ambassador to Ireland, Takanori Kazuhara, officers from the irish naval vessel the LE Aisling which shadowed and helped the vessel and a chaplain were present when the Taisei Maru docked in Cork's Hawlbowline Irish Naval base. The trawler had restarted its engines on Sunday after Japanese engineers were put aboard to ensure that the gas was gone and the engine room was safe for the remaining 16 crew. The bodies of the five were brought out of the ship on stretchers carried by crew from the Aisling in a brief ceremony on the Cork dockside. Some of the remains were likely to be repatriated and some cremated, officials said. A doctor was due to examine the remaining crew to ensure they were not harmed by the leak, Irish defence officials said. One man was injured by the leak but has recovered, they said. The vessel was among a fleet of more than 30 Japanese trawlers fishing for tuna, two of which were detained and their captain's charged with illegal fishing inside an area of Irish national waters known as the "Irish Box" at the weekend. The Japanese envoy tried to play down the controversy over an alleged standoff between the fishing fleet and Irish naval vessels shadowing its movements. "We are observing all the rules of law, and we respect any state's regulation as long as it is according with the norm of international agreement," he told state RTE radio. "In this case we do not yet know exactly what the facts are, so we will wait and see. That is our basic position on this." The fleet was using hooked lines which can be up to 80 km (50 miles) long to catch tuna feeding off the Irish coast. The lines can be dropped overboard and picked up later because of radio transmitters attached to them. Two sets of long-line tackle were recovered inside Irish waters last week. 3447 !G15 !G159 !GCAT !GOBIT !GPRO Emile Noel, a Frenchman who was the European Commission's top civil servant for almost 30 years, died on Saturday near Viareggio, Italy, officials said on Monday. Noel, who headed the Commission from 1958 to 1987, was 73. An official at the European University Institute in Florence, where Noel held a post until 1993, told Reuters that he had died at his summer house but she did not know the cause. "Europe is in mourning," Commission president Jacques Santer said in a telegram to Noel's wife that was distributed to reporters. Noel began as executive secretary of the Commission when it was the executive body for the just-established European Economic Community uniting Belgium, France, Germany, Italy, Luxembourg and the Netherlands. He was named secretary general in 1968 after the Commission's role was expanded to cover the activities of what was then known as the European Community -- now the European Union of 15 members. 3448 !GCAT !GCRIM A convicted murderer who claims he was wrongfully jailed plans to file a court case to force the Dutch state to grant him the right to die, his lawyer said on Monday. Jan Pieter van Vulpen said his client Fahti Gad, 35, was suffering intolerable mental pain because he was wrongfully imprisoned for eight years for the murder of a 28-year old woman in 1995. "Psychiatric evaluation should demonstrate "intolerable suffering' and that would grant him the right to a (lethal) injection," Van Vulpen said. Euthanasia is illegal under Dutch law, but under strict conditions doctors can end the life of patients suffering from intolerable physical or mental pain without being prosecuted. "Gad has tried to kill himself several times, but it proved rather difficult for someone in jail," his lawyer said. Van Vulpen said he would also demand a reopening of the police investigation into the murder case. 3449 !GCAT !GCRIM !GVIO Many of the German Nazi-hunters who let former SS captain Erich Priebke slip through their fingers in the 1970s were themselves former Nazis, according to a regional parliamentary document. Priebke was found guilty of murder four weeks ago by a military tribunal in Rome for his part in the massacre of 335 men and boys in the Ardeatine caves near Rome in 1944 -- the worst atrocity committed in Italy in World War Two. But he was spared prison as a 30-year statute of limitations had expired. He is now held pending possible extradition to Germany, which wants to try him on related murder charges. German prosecutors in the city of Dortmund have admitted they bungled a chance to indict Priebke more than 20 years ago. But a reply by the then justice minister of North Rhine-Westphalia to the state assembly last year shows that all three senior state prosecutors responsible for Priebke's file between 1947 and 1973 had been members of the Nazi party. For post-war senior justice officials to have been former Nazis is not in itself unusual. Most had been members of Hitler's party, either enthusiastically or simply to further their careers, and had to undergo post-war screening for serious transgressions before being allowed to serve again. But the minister, Rolf Krumsiek, conceded in his reply that "from today's point of view, their employment in (the office investigating Nazi war crimes) seems scarcely understandable". His reply was unearthed in a weekend edition of the regional Westfaelische Rundschau newspaper. One of the three senior prosecutors joined the Nazis before Hitler came to power in 1933, the other two shortly afterwards. All were active in the NSRB Nazi jurists' association, two even held office in Hitler's Sturmabteilung (SA) militia. Senior prosecutor Hermann Weissing, who is now in charge of the Dortmund war crimes unit, said last week that prosecutors had all the documents they needed to indict Priebke, but that the case was inexplicably bungled. In particular, they had evidence from the 1948 trial in Italy of Priebke's SS commander Herbert Kappler. The documents were shelved in 1971 without being translated or evaluated. Priebke lived in Argentina for decades after the war, not concealing his identity from the German consulate and even coming to Germany on visits. Germany finally issued an warrant for him last year after he had been tracked down by a journalist and admitted taking part in the massacre, a Nazi retaliation measure for a partisan bomb attack on German soldiers. 3450 !CCAT !GCAT !GCRIM A working group formed to develop an integrated plan to tackle crime in the airfreight sector at Schiphol airport will have completed a preliminary study by end-September. Hans Knuvers, secretary of the Air Transport Association of the Netherlands (ATAN), the Dutch airfreight industry association, who brought all interested parties together to discuss the problem, said initial talks have gone well. In a telephone interview with Reuters he said a series of meetings have taken place attended by representatives from Koninklijke Marechausee, the Dutch military police which is responsible for security at the airport, EVO, the transport and logistic employers organisation, Dutch customs' Hoofdorp branch and the Dutch Justice Ministry to invite officials to discuss criminal activity at Schiphol. The meetings came after a statement from ATAN which claimed there is evidence that certain parts of the transport cycle at the leading Dutch airport are vulnerable to acts of theft, sometimes carried out by well-organised criminals. Knuvers said initial meetings have gone well, and a preliminary study with an integrated action plan to tackle crime could be expected end September. "We have no firm plan of action as yet, but have a declaration of intent from all interested parties to come up with a plan in the near future," he told Reuters. 3451 !GCAT !GDIP Yemen said on Monday it was pulling out of French-led mediation efforts to resolve its dispute with Eritrea over a Red Sea island and vowed to force a withdrawal of Eritrean troops there. "There is a limit to our patience," vice-foreign minister Ghaleb Ali Jamil told RFI radio's Arabic service. "We have the right under Article 51 of the United Nations charter to use all means to defend ourselves and to defend our land." The article allows member states to defend themselves against armed attack. Yemen earlier this month threatened to take military action against Eritrea if mediation failed to defuse the crisis triggered by its sending troops to the island. Eritrea repeated it wanted to resolve the row peacefully. Jamil praised France's attempt to push negotiations but added that Yemen "will no longer take part in Paris arbitration meetings between the two countries as long as Eritrea does not withdraw from the Lesser Hanish Island," he said. "(Yemen calls for) an embargo against Eritrea if this country does not withdraw today from the Lesser Hanish as this behaviour represents a threat to shipping and security in the Red Sea," he said. Both states claim the islands, which lie near tanker routes at the Red Sea's southern entrance. They fought briefly last December over the islands and then agreed in Paris in May to settle the row through arbitration. The president of the U.N. Security Council said earlier this month that Eritrea should withdraw its troops immediately from the island as it had promised. French mediator Francis Gutman, despatched to Sanaa and Asmara with the blessing of U.N. Secretary-General Boutros Boutros-Ghali, said last weekend that Eritrea had agreed to withdraw its forces so that arbitration procedures could take place. At least 12 people were reported killed last December when the two countries fought over the Lesser Hanish and other disputed Red Sea islands. 3452 !GCAT !GPRO !GREL The health of Mother Teresa, who has been in hospital for six days suffering from malaria, a chest infection and a recurrence of heart trouble, was improving but she was not out of danger, doctors said on Monday. The 85-year-old nun, known as the "Saint of the Gutters" in Calcutta for her decades of work among the teeming city's poor and destitute, managed to scribble notes to doctors and well-wishers, they added. "Her condition has shown slow progress but she has reponded to treatment," one of the doctors attending her told Reuters. The doctor said they would try on Tuesday to take her off a respirator on which she has depended since she was taken to hospital on August 20 with a high fever and severe vomiting. "But she has to maintain the progress otherwise it will be difficult," the doctor said. Her chest infection had eased but her heartbeat was still irregular, he added. "She is still conscious," Dr S.K. Sen, medical director of Woodlands Nursing Home in Calcutta, said. "She is recognising the few visitors that had come in during the day". The Roman Catholic Archbishop of Calcutta, Henry D'Souza, said she held his hand and tried to say something when he visited her to convey good wishes from Pope John Paul II. Mother Teresa's 86th birthday is on Tuesday. Doctors and nuns at Mother House, headquarters of the Missionaries of Charity order founded by Mother Teresa in 1949, had to field scores of telephone calls earlier in the day as rumours of her death swept Calcutta. Authorities said a nun who had been a teacher at a local school had died, prompting the school to call off classes for the day and apparently triggering the rumour. Sister Judith, member of the Missionaries of Charity, said the improvement in Mother Teresa's condition was a "gift of our prayers". "Prayers can bring miracles," the nun told Reuters. After remaining in grave condition for much of last week, Mother Teresa showed signs of improvement on Sunday when she raised her hand to bless a visiting group of nuns. Ministers of the communist West Bengal government and people of various religions joined Roman Catholics to pray for her recovery at Mother House. "We joined the prayer to express our solidarity with her work for the cause of the poor and downtrodden," said Nanda Gopal Bhattacharya, a minister in the West Bengal state government and a member of the Communist Party of India. Several street children, some of them born to prostitutes, offered prayers on the street. "All of us know about her. She is like a Goddess," said Raju, aged eight. Children from Catholic schools sent flowers and colourful cards to Mother Teresa, an ethnic Albanian who was born in Skopje, now the capital of Macedonia. West Bengal Chief Minister Jyoti Basu sent a bouquet of red roses with a card saying, "I wish you a speedy recovery and a long life in the service of the people." Missionaries of Charity care for hundreds of destitute orphans and mentally impaired people in several homes scattered across the eastern Indian state of West Bengal. 3453 !GCAT !GPRO !GREL Mother Teresa scribbled short notes to doctors and well-wishers on Monday as she slowly gathered strength in her fight against malaria and a faltering heart, doctors said. "She is a shade better compared to yesterday," Dr S.K. Sen told reporters at Calcutta's Woodlands Nursing Home where the 85-year-old Roman Catholic nun has been under treatment since last Tuesday. Sen said Mother Teresa, who cannot speak because a tube has been inserted in her throat, was feeling well enough to scribble short letters and answer questions in writing. "Now she is scribbling notes and letters," he said. With a gentle wave of her hand on Sunday, Mother Teresa, winner of the Nobel Peace Prize in 1979, blessed a group of visiting nuns from her Missionaries of Charity. Her religious order denied a rumour which swept through Calcutta on Monday that the Nobel Peace Prize winner had died. "At the moment Mother Teresa is improving slightly," Sister Prasanna of the Missionaries of Charity told Reuters when asked about the rumour. "We want you to keep on praying for her." Authorities said a nun who had been a teacher at a local school had died, prompting the school to call off classes for the day -- apparently sparking the rumour. Both houses of the Indian parliament passed resolutions wishing the Albanian-born nun a happy birthday and speedy recovery, the Press Trust of India said. She turns 86 on Tuesday. Known as the Saint of the Gutters for her devotion to the poor and destitute, Mother Teresa was admitted to the hospital last Tuesday with a high fever and severe vomiting. The fever has abated and the vomiting stopped but doctors said her heart continued to beat irregularly. She remained on an artificial respirator and was still being drip-fed. "Mother Teresa is fully conscious today," said Dr J.C. Ghosh, the chief cardiologist treating her. He said doctors had intermittently removed the respirator on Monday in an effort to wean her from its support. Ghosh said Mother Teresa was no longer running a temperature. Her heart rate was still irregular, but her heart failure, which began shortly after she entered hospital, was under control, he said. "The heart problem is an extension of her old heart disease. The fever and chest infection have precipitated it," Ghosh said. Asked when the respirator would be removed, Ghosh said: "It is still a million-dollar question. She is still under close observation. We cannot give you any time-frame." Officials said she was able to breathe for about two minutes without the respirator. Sister Judith, a member of the Missionaries of Charity, the order founded by Mother Teresa in 1949, said on Monday her improvement was "a gift of our prayers". "Prayers can bring miracles," the nun told Reuters. Mother Teresa's 86th birthday falls on Tuesday. Members of her religious order began the birthday celebration on Monday. "Mother does not believe in celebrating birthdays but we like to make it an event. We celebrate it a day before," said Sister Jovita, in charge of Shanti Daan (Gift of Peace), Mother Teresa's home for mentally ill women. Children from Roman Catholic schools sent flowers and colourful cards to Mother Teresa ahead of her birthday. 3454 !GCAT !GDIS !GREL Rows of ill and distraught Hindus, survivors of a harrowing pilgrimage during which at least 128 died, lay exhausted on Monday in tents clustered around the Himalayan foothill town of Pahalgam. More than 60,000 pilgrims gathered in Pahalgam after spending up to four days on an exposed mountainside at the mercy of bitter wind, rain and snow. Authorities said 128 people trekking to a holy cave 3,880 metres (12,725 feet) high in the Himalayas died last week in below-freezing temperatures that followed unusually heavy rains. The Press Trust of India put the toll at 160. Some 112,000 Hindus came to Kashmir for this year's pilgrimage to the holy Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu God Shiva. Among the dead were naked "sadhus", or Hindu holy men who smear their bodies with ash. The pilgrims were marooned at Pahalgam, the base camp for the five-day, 50-km (30-mile) trek, because all roads to the town were cut off after last week's torrential rains. "There were lines of 3,000 to 4,000 people queued up outside the food tents," said Fayyaz Kabli, a local photographer who visited the town on Sunday. "They were many women and children crying. Sadhus were sitting silently by the roadside and not saying anything." Many of the pilgrims were angry at what they described as poor arrangements by the government for the pilgrimage. "'We were sent here to die,'" Kabli quoted one of them as saying. "' The government has not helped us. When we were dying they did not help us. Now what is the point of sending helicopters?'" Opposition deputies criticised Prime Minister H.D. Deve Gowda's United Front government for what they said was its failure to take adequate action to prevent the deaths. "It is a grim human tragedy of unprecedented dimensions," said Jaswant Singh of the Hindu nationalist Bharatiya Janata Party said in parliament. "Over 150,000 people have been abandoned to their fate." "After this tragedy, the government was callous, and it should be charged for dereliction of duty," said former Prime Minister Chandrashekhar. "If any lapse has taken place, action will be taken," Gowda assured parliament. Military helicopters plucked 2,000 pilgrims from the mountainside on Sunday after the weather cleared for the first time in four days. Between 300 and 400 soldiers escorted several thousand more, who had climbed above the base camp, to safety. Kabli travelled along the pilgrimage route, interviewing returning pilgrims. Many were frantic with grief or worry over the fate of family members, he said. "At the police station in Pahalgam, we met a man whose brother had died," said Kabli. "He was crying, shouting: 'I am ready to pay three million rupees ($85,000) to anybody who can help me transport my brother's body to New Delhi'." Further along the pilgrims' route at Chandanwadi, 12 km (eight miles) beyond Pahalgam, Kabli said he saw rows of corpses laid out beside the road. At Pissu Top, about 12 km (eight miles) from the Amarnath cave, Kabli said he saw army and paramilitary troops leading corpse-laden ponies down the steep slope. 3455 !GCAT !GPRO !GREL Mother Teresa scribbled short notes to doctors and well-wishers on Monday as she slowly gathered strength in her fight against malaria and a faltering heart, doctors said. "She is a shade better compared to yesterday," Dr S.K. Sen told reporters at Calcutta's Woodlands Nursing Home where the 85-year-old Roman Catholic nun has been under treatment since last Tuesday. Sen said Mother Teresa, who cannot speak because a tube has been inserted in her throat, was feeling well enough to scribble short letters and answer questions in writing. "Now she is scribbling notes and letters," he said. With a gentle wave of her hand on Sunday, Mother Teresa blessed a group of visiting nuns from her Missionaries of Charity. Her religious order denied a rumour which swept through Calcutta on Monday that the Nobel Peace Prize winner had died. "At the moment Mother Teresa is improving slightly," Sister Prasanna of the Missionaries of Charity told Reuters when asked about the rumour. "We want you to keep on praying for her." Authorities said a nun who had been a teacher at a local school had died, prompting the school to call off classes for the day -- apparently sparking the rumour. Known as the Saint of the Gutters for her devotion to the poor and destitute, Mother Teresa was admitted to the hospital last Tuesday with a high fever and severe vomiting. The fever has abated and the vomiting stopped but doctors said her heart continued to beat irregularly. She remained on an artificial respirator and was still being drip-fed. "Mother Teresa is fully conscious today," said Dr J.C. Ghosh, the chief cardiologist treating the renowned missionary. He said doctors had intermittently removed the respirator on Monday in an effort to wean her from its support. Ghosh said Mother Teresa was no longer running a temperature. Her heart rate was still irregular, but her heart failure, which began shortly after she entered hospital, was under control, he said. "The heart problem is an extension of her old heart disease. The fever and chest infection have precipitated it," Ghosh said. Mother Teresa, who won the Nobel Peace Prize in 1979, was fitted with a heart pacemaker one decade later. Asked when the respirator would be removed, Ghosh said: "It is still a million-dollar question. She is still under close observation. We cannot give you any time-frame." Officials said she was able to breathe for about two minutes without the respirator. Sister Judith, a member of the Missionaries of Charity, the order founded by Mother Teresa in 1949, said on Monday her improvement was "a gift of our prayers". "Prayers can bring miracles," the nun told Reuters. Mother Teresa's 86th birthday falls on Tuesday. Members of her religious order began the birthday celebration on Monday. "Mother does not believe in celebrating birthdays but we like to make it an event. We celebrate it a day before," said Sister Jovita, in charge of Shanti Daan (Gift of Peace), Mother Teresa's home for mentally ill women. Children from Roman Catholic schools sent flowers and colourful cards to Mother Teresa ahead of her birthday. 3456 !GCAT !GDIS !GREL Rows of ill and distraught Hindus, survivors of a harrowing pilgrimage during which at least 127 died, lay exhausted on Monday in tents clustered around the Himalayan foothill town of Pahalgam. More than 60,000 pilgrims gathered in Pahalgam after spending up to four days on an exposed mountainside at the mercy of bitter wind, rain and snow. Authorities said 127 people trekking to a holy cave 3,880 metres (12,725 feet) high in the Himalayas died last week in below-freezing temperatures that followed unusually heavy rains. The Press Trust of India put the toll at 160. Some 112,000 Hindus came to Kashmir for this year's pilgrimage to the holy Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu God Shiva. Among the dead were naked "sadhus", or Hindu holy men who smear their bodies with ash. The pilgrims were marooned at Pahalgam, the base camp for the five-day, 50-km (30-mile) trek, because all roads to the town were cut off after last week's torrential rains. "There were long lines of 3,000 to 4,000 people queued up outside the food tents," said Fayyaz Kabli, a local photographer who visited the town on Sunday. "They were many women and children crying. Sadhus were sitting silent by the roadside and not saying anything." Many of the pilgrims were angry at what they described as poor arrangements by the government for the pilgrims. "'We were sent here to die,'" Kabli quoted one of them as saying. "' The government has not helped us. When we were dying they did not help us. Now what is the point of sending helicopters?'" Military helicopters plucked 2,000 pilgrims from the mountainside on Sunday after the weather cleared for the first time in four days. Between 300 and 400 soldiers escorted several thousand more, who had climbed above the base camp, to safety. Kabli travelled along the pilgrimage route, interviewing returning pilgrims. Many were frantic with grief or worry over the fate of family members, he said. "At the police station in Pahalgam, we met a man whose brother had died," said Kabli. "He was crying, shouting: 'I am ready to pay three million rupees ($85,000) to anybody who can help me transport my brother's body to New Delhi.'" Further along the pilgrims' route at Chandanwadi, 12 km (eight miles) beyond Pahalgam, Kabli said he saw rows of corpses laid out beside the road. "There were lots of dead bodies in terrible condition," Kabli told Reuters. "Many had no clothes. Occasionally there was the corpse of a dead pony or two. Army troops came, loaded the bodies into trucks and took them away to be cremated." At Pissu Top, about 12 km (eight miles) from the Amarnath cave, Kabli said he saw army and paramilitary troops leading corpse-laden ponies down the steep slope. "Rakesh, a 30-year-old man from Hyderabad, said he had seen a group of about 100 people walking along a glacier when the glacier suddenly collapsed, burying them all alive," Kabli said. "'Nobody is talking about all those deaths. I saw them with my own eyes,'" he quoted Rakesh as saying. The spokesman for the Jammu and Kashmir state government, K.B. Jandial, said numerous unclaimed bodies had been cremated by the authorities. 3457 !GCAT !GPRO !GREL Mother Teresa scribbled short notes to doctors and well-wishers on Monday as the renowned missionary slowly gathered strength in her fight against malaria and a faltering heart, doctors said. "She is a shade better compared to yesterday," Dr S.K. Sen told reporters at Calcutta's Woodlands Nursing Home where the 85-year-old Roman Catholic nun has been under treatment since last Tuesday. Sen said Mother Teresa, who cannot speak because a tube has been inserted in her throat, was feeling well enough to scribble short letters and answer questions in writing. "Now she is scribbling notes and letters," he said. With a gentle wave of her hand on Sunday, Mother Teresa blessed a group of visiting nuns from her Missionaries of Charity. Known as the Saint of the Gutters for her devotion to the poor and destitute, Mother Teresa was admitted to the hospital last Tuesday with a high fever and severe vomiting. The fever has abated and the vomiting stopped but doctors said her heart continued to beat irregularly. She remained on an artificial respirator and was still being drip-fed. "Mother Teresa is fully conscious today," said Dr J.C. Ghosh, the chief cardiologist treating the missionary. He said doctors had intermittently removed the respirator on Monday in an effort to wean her from its support. Ghosh said Mother Teresa was no longer running a temperature. Her heart rate was still irregular, but her heart failure, which began shortly after she entered hospital, was under control, he said. "The heart problem is an extension of her old heart disease. The fever and chest infection have precipitated it," Ghosh said. Mother Teresa, who won the Nobel Peace Prize in 1979, was fitted with a heart pacemaker one decade later. Asked when the respirator would be removed, Ghosh said: "It is still a million-dollar question. She is still under close observation. We cannot give you any time-frame." Officials said she was able to breathe for about two minutes without the respirator. Sister Judith, a member of the Missionaries of Charity, the order founded by Mother Teresa in 1949, said on Monday her improvement was "a gift of our prayers". "Prayers can bring miracles," the nun told Reuters. Mother Teresa's 86th birthday falls on Tuesday. Members of her religious order began the birthday celebration on Monday. "Mother does not believe in celebrating birthdays but we like to make it an event. We celebrate it a day before," said Sister Jovita, in charge of Shanti Daan (Gift of Peace), Mother Teresa's home for mentally ill women. Children from Roman Catholic schools sent flowers and colourful cards to Mother Teresa ahead of her birthday. The communist chief minister of West Bengal state, Jyoti Basu, sent her a bouquet of red roses with a card saying, "I wish you a speedy recovery and a long life in the service of the people." The Missionaries of Charity care for hundreds of destitute orphans and mentally impaired people in several homes scattered across the eastern Indian state of West Bengal. 3458 !GCAT VEERAKESARI Tamil refugees suffering in Wanni jungles without food or shelter. --- THINAKARAN Government announces 50 percent pay hike for state sector employees and military personnel. --- DAILY NEWS Lanken Plantations Holdings buys 51 percent stake in Agarapatana Group. --- THE ISLAND Prime Minister Sirima Bandaranaike tells Deputy Defence Minister Anuruddha Ratwatte not to defame her family. --- LANKADEEPA Three Tamil Tiger rebels killed while trying to plant mine in Amparai. --- DIVAINA MEP stages demonstration at Kataragama in campaign to protect Sri Lanka's unity. --- DINAMINA Another victim of UNP's terror campaign exhumed at Ja-ela. --Colombo newsroom tel 941-434319 3459 !GCAT !GPRO Mother Teresa's condition improved on Monday as she fought against a faltering heart but doctors said the Nobel peace laureate was stll in danger as long as she depended on a respirator. "She is slightly better than last night. There are signs of improvement," an official at Calcutta's Woodlands Nursing Home, where the Albanian-born Roman Catholic nun is being treated, told Reuters. Mother Teresa, known as the Saint of the Gutters for her devotion to the poor and destitute, was admitted to the hospital last Tuesday with a high fever and severe vomiting. The fever has abated and the vomiting stopped but doctors said her heart continued to beat irregularly. She remained on an artificial respirator and was still being drip fed. Doctors said they wanted to wean her off the respirator, which amounted to a life-support system for the missionary, who marks her 86th birthday on Tuesday. Mother Teresa blessed a group of nuns on Sunday evening by gently raising her hand. Sister Judith, a member of the Missionaries of Charity, the order founded by Mother Teresa in 1949, said on Monday her improvement was "a gift of our prayers". "Prayers can bring miracles," the sister told Reuters. Members of the order celebrated Mother Teresa's birthday on Monday. They traditionally mark the event a day early. "Mother does not believe in celebrating birthdays but we like to make it an event. We celebrate it a day before," said Sister Jovita, in charge of Shanti Dan (Gift of peace), Mother Teresa's home for mentally ill women. A banner reading "Long live Mother Teresa" and "Happy birthday Mother Teresa" was placed above the entrance to the Woodlands Nursing Home. Father Jeff Bayhi, a U.S.-based friend of Mother Teresa, read out a "birthday poem" from Pope John Paul during a morning service at the Mother House, headquarters of the Missionaries of Charity. Dr S.K. Sen, medical director at Woodlands, said Mother Teresa was still unable to speak. "Mother Teresa had no further cardio-vascular problems during the day, though her heart rate is still irregular," Sen said on Sunday evening. Doctors said her heartbeat was less irregular and she was breathing easier than before. But Sen said Mother Teresa, who won the Nobel Peace Prize in 1979, was not out of danger. "We are very much encouraged by today's (Sunday) progress. By tomorrow we hope things will significantly improve," he said. Roman Catholic churches continued their prayers on Monday for Mother Teresa's recovery. Calcutta's Archbishop Henry D'Souza, who prayed by her bedside for most of Sunday, appealed to the people of Calcutta to continue praying for her. Earlier, thousands of people, including Moslems and Hindus, joined in prayers for the nun. Several foreigners, including a group of touring Japanese, visited the Mother House and knelt down to pray for her. "She is a living saint for everybody," said Sister Priscilla, a senior nun at the order. 3460 !GCAT Following are some of the main stories in Monday's Pakistani newspapers. DAWN - Floods destroyed rice fields near Sialkot town in Punjab province and washed away many houses. The army was called out in the Multan and Muzaffargarh districts in view of high flood due to pass in the next 24 hours. - The government may allow an increase of up to 12 percent in medicine prices from September 1. - All the opposition deputies and senators from the North West Frontier Province presented their resignations from both houses of parliament to opposition leader Nawaz Sharif. - At least 20 people were killed and 17 injured when a passenger bus tumbled from a mountain road into a river in Pakistan-ruled Azad (free) Kashmir. - The second review of the 1996/97 (July-June) budget by the International Monetary Fund (IMF) is expected to take place in October following which the second and third tranches of $80 million each out of the $600 million standby loan agreement are expected to be released, government sources said. - The Central Board of Revenue has waived customs and regulatory duty on import of most edible oil seeds, including soyabean, colza, rape, sunflower, canola and salicornia. BUSINESS RECORDER - The government assured cotton traders that it would impose no restriction on the free export of raw cotton. - Traders said 1,000 tonnes of refined sugar worth 21 million rupees stocked in Lahore were damaged by rain. THE NATION - The state-run First Women Bank has suffered a loss of 700 million rupees ($20 million) in forward trading of U.S. dollars. - The state-run Habib Bank Limited has announced a $300 million credit line to finance exports. -- Islamabad newsroom 9251-274757 3461 !GCAT Following is a summary of major Indian business and political stories in leading newspapers prepared for Reuters by Business News and Information Services Pvt Ltd, New Delhi. Telephone: 11-3324842, 11-3761233; Fax: 91-11-3351006 Internet : biznis. news@forums. sprintrpg. sprint. com -------oo0oo------- TOP STORIES Hindustan Times OVER 8,000 AIR LIFTED; PILGRIM DEATH TOLL 160 A massive rescue operation was launched to save more than 8,000 pilgrims stranded in Sheshnar and Panjtarni in Jammu and Kashmir state. Air Force helicopters airlifted nearly 9,000 pilgrims as the death toll caused by heavy snow rose to 160. There were still 150 pilgrims stuck at the 3,657 metre high Panjtarni camp in the Himalayas, six km from the holy Amarnath shrine and 500 others at the 3,718 metre high Sheshnag camp. A total of 60,000 pilgrims have been stranded at Pahalgam. ---- Times Of India DEVE GOWDA, ON SCAMS, SAYS LAW WILL TAKE OWN COURSE Prime Minister Deve Gowda has promised to continue an investigation into scams that have hit India in recent months. On pending corruption cases, Deve Gowda said the law would take its own course. His statement was on the eve of parliament reopening on Monday. ---- Economic Times CAPITAL ADEQUACY NORMS MAY BE RELAXED The Reserve Bank of India (RBI), the central bank, may relax some provisions to help banks meet stipulated minimum capital adequacy ratio (CAR) requirements. This could include changing the existing provisioning weightages for non-performing assets and easing the upper limit on tier-II capital. THREE TELECOMMUNICATION FIRMS CONSIDER ADRS Three telecommunication companies -- BPL Cellular, Bharati Televenture and Hutchison Max -- plan to make public offerings through the sale of American Depository Receipts (ADR). Two of them have already approached the finance ministry seeking clearance in principle. BPL and Hutchison plan to float $200 million ADRs each. Bharati plans to go for a relatively smaller issue of about $100 to $125 million. Morgan Stanley is believed to have won the mandate to handle the ADRs of BPL and Bharati, while Goldman Sachs won the mandate for Hutchison Max. ---- Financial Express MODI PLANS NEW JOINT VENTURE WITH CONTINENTAL German-based tyre giant Continental, BK and VK Modi are tying up to set up a new joint venture for a radial tyre project. Earlier plans for setting up a plant under Modi Rubber Limited have been shelved. Continental and the two Modi brothers are likely to have equal stakes in the new company. Modi group sources said the formal agreements were likely to be signed within the next two months. FORWARD COVER NORMS FOR FOREIGN EXCHANGE LOANS EASED The Reserve Bank of India (RBI) has allowed the booking of forward cover on interim dividends declared by corporates. RBI has also allowed authorised dealers to offer forward cover on foreign currency loans and global depository receipts on the settlement of issue prices. Central bank sources said authorised dealers could now offer a forward cover on interim dividends once the final accounts have been settled and the corporate has decided on interim dividend rate. INFLATION RISES TO 5.41 PCT India's annual rate of inflation jumped 0.37 percentage points to 5.41 percent during the week ended August 10. Inflation was 8.5 percent during the corresponding period of the previous year. The official wholesale price index for all commodities (base 1981/82=100) for the week under review stood at 311.9 (provisional) against 311.1 (provisional) for the previous week. SIEMENS-TELECOM TO SET UP TELEPHONE MANUFACTURING FACILITY Siemens-Telecom Ltd, the joint venture between Siemens of Germany and Bharti Telecom, plans to set up a manufacturing facility for terminals within the next year. The facility would make over two million telephone sets a year. A company source said the four billion rupee manufacturing facility would probabily be set up in Gurgaon or Okhla near Delhi. ---- Business Standard PHILIPS MAY RETAIN 10 PCT STAKE IN TELECOMMUNICATION ARM As Philips India prepares to hive off its wholly-owned telecommunication subsidiary, it has indicated it would still retain a stake of at least 10 percent in the new venture. Philips has already decided to sell off its private mobile radio division to Simoco International. Simoco International would have an international structure comprising Simoco Europe, Simoco Asia Pacific and Simco India. Headquartered in Cambridge, England, it would focus on the wireless communications business. ---- The Observer FOODGRAIN OUTPUT MAY FALL SHORT OF TARGET Foodgrain production may slide this year despite a good monsoon. Reasons include slippage in fertiliser consumption and the diversion of one million hectares to cash crops. Oil seed production, however, is likely to rise due to early rains in the groundnut growing areas of Gujarat and Maharashtra. The agriculture ministry has yet to declare its estimates for the 1996 kharif (winter) crops. Given the current outlook, the target of 210 million tonnes of foodgrains was less likely to be achieved this year, sources said. US INFORMATION TECHNOLOGY FIRM PLANS BASE IN INDIA The U.S. information technology firm SDRC plans to use India as a base to develop various existing software packages to suit conditions and need of other Asian countries. SDRC country manager Narendar Reddy said the firm would be signing a strategic agreement with Tata Technologies. He said SDRC was also in the process of signing an agreement with a multinational with a strong presence in India. Both agreements would be signed by the first week of September, he said. GDR INDEX IMPROVES BY 9.53 PCT The Skindia Global Depository Receipts (GDR) Index looked up after a downward slide in the last four weeks. Buying support from traders and long-term investors pushed the index up by 9.53 percent towards the end of last week. During the week, 32 GDRs gained, 14 lost and 15 remained unchanged, compared with 22 gainers and 38 losers the previous week. POWER FINANCE CORP MAY STEP UP DISBURSEMENTS The Power Finance Corp (PFC) is engaged in a feasibility study on the need for external commercial borrowings to meet its financial requirements. It also plans to approach the Asian Development Bank (ADB) and the World Bank for additional credit finance for various power projects in the country. PFC, as part of its Vision 2000 plan, is considering whether to step up its disbursements from the present 10 billion rupees to 50 billion rupees in the next four years. 3462 !GCAT !GPRO Mother Teresa marked her 86th birthday on Tuesday, but she remained in a Calcutta hospital fighting a life-threatening recurrence of malaria and heart trouble. Hospital officials said her condition had improved over the past two days but doctors said she would be be in danger until she could be taken off the respirator on which she has depended for a week. "Her breathing is still irregular, she is conscious," a hospital official said. "Today will be crucial". Mother Teresa, an ethnic Albanian known as "Saint of the Gutters" for her devotion to thousands of poor and destitutes, was admitted to Calcutta's Woodlands Nursing Home on August 20 with high temperature and severe vomiting. Her condition improved on Monday when a chest infection eased and her malarial fever dropped. She was unable to speak but scribbled notes and gestured in the presence of visitors, including blessing some nuns by gently raising a hand. "She is a shade better than yesterday," Dr S.K. Sen, medical director at Woodlands, said on Monday night. "Her condition has shown slow progress but she has reponded to treatment," one of the doctors attending her told Reuters. The doctor said they would try to take the Nobel peace laureate off the respirator on Tuesday. "But she has to maintain the progress otherwise it will be difficult. Her heartbeat was still irregular," he added. Thousands in Calcutta, where she founded her order, the Missionaries of Charity, prayed for her recovery. Ministers of the communist West Bengal government and people of various religions joined Roman Catholics to pray for Mother Teresa's recovery at Mother House, headquarters of the order which she founded in 1949. "We joined the prayer to express our solidarity with her work for the cause of the poor and downtrodden," said Nanda Gopal Bhattacharya, a minister in the West Bengal state government and a member of the Communist Party of India. Several street children, some of them born to prostitutes, held prayers on the street. "All of us know about her, she is like a Goddess," said Raju, aged eight. 3463 !GCAT !GVIO At least 25 rockets smashed into Kabul on Monday, wounding eight people, as government forces battled Taleban rebels to the southeast, official sources said. Government-controlled Kabul radio said several residential areas came under rocket fire from positions held by the opposition Taleban militia just south of the capital. A source close to Prime Minister Gulbuddin Hekmatyar's Hezb-i-Islami party said heavy fighting was raging between the Taleban and Hezb-i-Islami fighters in the Azra area, 60 km (37 miles) southeast of Kabul, on the edge of Nangarhar province. "There is intense fighting in Azra," the source said. "We want to halt the Taleban advance. Their aim is to get control of Sarobi to tighten their siege of Kabul." The latest fighting followed the capture on Friday of Hezb-i-Islami's strategic Spina Shega base on the Pakistani border in the eastern province of Paktiya by the Taleban. The base had been used to supply Hezb-i-Islami forces in their stronghold of Sarobi, a town 60 km (37 miles) east of the Afghan capital astride the main Kabul to Jalalabad highway. A government delegation led by Deputy Prime Minister Qutbuddin Hilal and Abdullah (one name), a senior aide to military commander Ahmad Shah Masood went to Jalalabad on Monday to meet neutral faction leaders based there, officials said. Afghan sources in the Pakistani city of Peshawar said the delegation had offered military support to the Jalalabad-based Nangarhar shura (council) of neutral factions against a possible threat from the Taleban. Its response was not immediately known. Hekmatyar rejoined President Burhanuddin Rabbani's government in June after a reconciliation with his former foe. He had previously tried to persuade the Taleban to join an anti-Rabbani alliance, but had been repeatedly rebuffed. The Taleban and Hezb-i-Islami both draw most of their support from Afghanistan's traditionally dominant ethnic Pashtun community. Fired by Islamic zeal, Taleban have sworn to sweep away the Mujahideen guerrilla factions which have fought for power since the fall of a communist government in April 1992 and install a strict Islamic order throughout Afghanistan. 3464 !GCAT !GDEF !GDIP Pakistan on Monday denied a U.S. newspaper report that said it was building a missile plant in Rawalpindi, near Islamabad, with Chinese help. "This is a figment of the unlimited imagination of the Washington Post, which is in the habit of breaking such stories in the past which have proved incorrect, false and malicious," Foreign Minister Assef Ahmad Ali told reporters. "This is another false and malicious story," he said. "No such factory is working and we are not replicating any missiles with the help of any other country," he said. However, the foreign minister said Pakistan would do whatever it felt necessary to defend itself. "Let me clearly put it on record that Pakistan reserves the right to develop anything for its defence with its own resources," he said. The Washington Post reported on Sunday that U.S. intelligence officials had concluded that Pakistan was secretly building a medium-range missile factory in a suburb of the northern city of Rawalpindi. China has denied any role in the reported project. "The U.S. newspaper report is entirely groundless," a Foreign Ministry spokeswoman said in Beijing on Monday. The Washington Post said that the development raised the prospect of a new Sino-U.S. dispute over arms proliferation. It said the partially completed plant was expected to be capable of producing most of the major components of a missile modeled on the Chinese-designed M-11 in a year or two. Some U.S. officials believed the factory would produce precise duplicates of the missile, the paper said. A White House spokesman said he could not confirm the story but said the United States took such reports seriously. "We do not believe it is in the best interests of the United States or of any other country to supply Pakistan with the capacity to manufacture or deploy weapons of mass destruction," the spokesman said. The United States has twice imposed limited economic sanctions against China for selling M-11 missile launchers and finished missile components to Pakistan, but withdrew the curbs after Beijing promised to stop such deliveries. Washington halted aid to Pakistan in 1990 over suspicion of its nuclear programme. It eased sanctions this year, deciding to deliver $368 million worth of blocked military equipment, but not 28 F-16 fighter planes Islamabad had paid for. The first shipment of the released equipment arrived in Karachi port earlier on Monday. "This event is not only a harbinger of a new phase of strengthening Pakistani-U.S. relations but also a vindication of the present government's successful foreign policy", Defence Minister Aftab Shaaban Meerani said in Karachi. 3465 !GCAT !GVIO Two of four Westerners held hostage in Kashmir for more than a year were reported on Monday to have been seen recently, but government officials and diplomats said the sighting had not been confirmed. United News of India (UNI) quoted unnamed official sources as saying forest guards and nomads saw the two hostages and 16 gunmen last week at Bajpathari village in the northern state of Jammu and Kashmir. The hostages had long beards and sunburnt faces but could not be identified, UNI said. American Donald Hutchings, German Dirk Hasert and Britons Keith Mangan and Paul Wells were kidnapped by shadowy Al-Faran guerrillas in July 1995 while trekking in the Himalayas. A fifth hostage, Norwegian Hans Christian Ostroe, was found beheaded in a Kashmiri forest last August. Al-Faran cut off contact with government authorities last November. Since then locals have periodically reported seeing the hostages and their abductors moving in remote areas of the state. A captured militant recently said he thought the hostages had been killed, but a search of the area where he said they were believed to have been buried turned up no evidence. UNI said the two hostages were reported to have been sighted in Doda district, south of the Kashmir valley, at an altitude of about 12,000 feet (3,660 metres). "There is no corroboration for this report," a state government official said. A diplomat said the foreign governments whose nationals were being held hostage had received no evidence that the hostages were in the region, only anecdotal reports which could not be confirmed. 3466 !GCAT !GDEF !GDIP A ship carrying U.S. military equipment released by Washington after a six-year delay began unloading in Karachi port on Monday. "This event is not only a harbinger of a new phase of strengthening Pakistani-U.S. relations but also a vindication of the present government's successful foreign policy", Defence Minister Aftab Shaaban Meerani said. The United States halted aid to Pakistan in 1990 over suspicions about its nuclear programme, blocking $1.4 billion of military equipment Islamabad had paid for. President Bill Clinton signed legislation in January which authorised him to release $368 million of the equipment, but not 28 F-16 fighters. Washington is trying to sell the F-16s to third parties to reimburse Pakistan with the proceeds. The official APP news agency said the cargo of the Pakistani-flagged MV Chitral included parts for M-48A5 tanks, M-88 armoured recovery vehicles, M-109 self-propelled guns, M-110 howitzers and M-113 armoured personnel carriers. Meerani said the next consignment of airforce equipment would be flown to Rawalpindi, near the capital Islamabad, and all the previously-embargoed gear, except the F-16s, would arrive by December. The remainder of the equipment to be delivered includes howitzers, anti-tank missiles, spares, radar equipment, night-sight equipment, tank/armoured personnel carrier rebuild facilities and three P-3C Orion maritime patrol aircraft. A U.S.-Pakistani consultative group, set up to discuss defence issues, is due to meet in Rawalpindi on October 20. Meerani said Pakistan would take delivery in February of the first three of 40 used Mirage-III fighters it has bought from France for $118 million. 3467 !GCAT !GCRIM !GDIP Afghanistan's militant Islamic Taleban movement has launched a drive to stop drug smuggling across the Iranian border, a Taleban leader said on Monday. Mullah Yar Muhammad, governor of the western province of Herat, told the Pakistan-based Afghan Islamic Press agency that 150 Taleban fighters under the command of Mullah Abdul Wali had been assigned to patrol the Afghan-Iranian border. He said the initiative followed talks with an Iranian delegation two weeks ago in which the two sides agreed to make joint efforts to combat narcotics trafficking. Muhammad said the agreement was a sign of better relations between the Taleban and Iran, which has been deeply suspicious of the Islamic rebels since their emergence in 1994. The Herat governor described opium, of which Afghanistan is a leading world producer, as a curse and said no heroin factories were operating in Taleban-controlled territory. The Taleban captured Herat and other western provinces from pro-government forces a year ago. The main opium-growing areas in Afghanistan are the Taleban-held provinces of Helmand, Kandahar and Uruzgan, as well as Nangarhar province, controlled by neutral factions. Smaller amounts are grown in the government-held northern provinces of Badakhshan and Kunar and the Taleban-ruled western provinces of Farah and Nimroz, U.N. officials say. Afghanistan produced an estimated 2,200 to 2,400 tonnes of dry opium gum in the 1994/95 crop year, a drop of about 32 percent on the previous year, according to a survey by the U.N. International Drug Control Programme (UNDCP). The survey attributed the decrease to enforced large-scale eradication in Nangarhar, and to higher wheat prices and fear of Taleban reprisals in Helmand, Uruzgan and Kandahar. It said lower prices, high labour costs, higher wheat prices and increased Iranian law enforcement efforts had depressed production in Nimruz. Only Badakhshan increased its output. The Vienna-based UNDCP has not released the results of its survey for 1995/96. 3468 !GCAT !GPRO !GREL Mother Teresa's health continued to improve on Monday, and doctors said the renowned Roman Catholic missionary was feeling strong enough to write short notes to well-wishers. "Now she is scribbling notes and letters," Dr S.K. Sen told reporters at Calcutta's Woodlands Nursing Home where the 85-year-old nun has been under treatment since last Tuesday. A doctor at the hospital said Mother Teresa, breathing with the help of a respirator in the intensive care unit, had requested and received holy communion on Sunday. "Mother Teresa is fully conscious today," said Dr J.C. Ghosh, the chief cardiologist treating the missionary. He said doctors had intermittently removed the respirator on Monday in an effort to wean her from its support. Ghosh said Mother Teresa, who entered hospital with a high fever, was no longer was running a temperature. Her heart rate was still irregular, but her heart failure, which began shortly after she entered hospital, was under control, he said. "The heart problem is an extension of her old heart disease. The fever and chest infection have precipitated it," Ghosh said. Mother Teresa was fitted with a heart pacemaker in 1989. 3469 !GCAT !GDIS !GREL Some 65,000 dishevelled Hindu pilgrims huddled under tents in a sunlit valley in India's Jammu and Kashmir state on Monday after snow and heavy rain had marooned them in the Himalayas for four days. Officials in Srinagar, the state's summer capital, said at least 121 people had died of exposure at heights of up to 3,700 metres (12,140 feet). The Press Trust of India and other sources put the death toll as high as 160. Some 112,000 Hindus had arrived in Kashmir for this year's pilgrimage to the holy Amarnath cave, where devotees worship an ice stalagmite believed to be a manifestation of the "lingam", or phallus, of the Hindu God Shiva. Naked "sadhus" or Hindu holy men who had smeared their bodies only with ash were among those who died, officials said. Military helicopters plucked 2,000 pilgrims from the mountainside on Sunday after the weather cleared for the first time in four days. The helicopters also dropped food, medicine and blankets to help some 300 people in a thickly forested part of the route near the frozen Sheshnag lake. The lake is about 15 km (nine miles) south of Amarnath and normally the third stage of a five-day trek to the cave. On Monday, thousands of bedraggled pilgrims milled around the muddy streets of Pahalgam, base camp for the 50-km (30-mile) trek to the cave, 3,880 metres (12,725 feet) above sea level. "At least 30,000 pilgrims have reached Pahalgam town," A.K. Suri, a senior police official, told Reuters. Roughly the same number had already been stranded there for several days. Most of them had trekked down the difficult slopes to Pahalgam, 100 km (60 miles) by road from Srinagar, he said. But floods had made nearly all roads to the town impassable. The pilgrims were escorted by between 300 and 400 soldiers. State government spokesman K.B. Jandial said 2,000 people were flown to Srinagar and other Kashmiri towns on Sunday by three military helicopters which flew 50 sorties during the day. Suri said authorities feared the death toll might climb. He said: "121 people have died so far but the number of deaths may increase as we are searching for bodies buried under the snow along the pony tracks." Only a few hundred people remained stranded around Sheshnag lake, 60 km (40 miles) from Srinagar, and Panchtarni, nine km (six miles) beyond and close to the Amarnath cave, spokesman Jandial said. More than 70 people died near the lake, about 15 km (nine miles) south of the cave. The trek began last week but was suspended on Saturday because of incessant rain and snow. The weather delayed the traditional march of the "charri mubarak", or maces, which symbolise Lord Shiva and his consort. Authorities said they planned to fly the maces to Panchtarni later on Monday. Deependra Giri, an ascetic who traditionally carries the maces on the trek, refused to be deterred by the tragedy. "It is a big tragedy, but we will not stop the yatra (journey)," Giri told reporters. "I will prefer to trek." Last year the pilgrims were threatened by Moslem separatist guerrillas, who staged two bomb attacks on the heavily guarded pilgrims. A state civil servant was killed in one of the blasts. This year the guerrillas issued no ban on the pilgrimage. Instead, bad weather has endangered the pilgrims' lives. 3470 !GCAT !GPRO Mother Teresa's condition improved on Monday as she continued her battle against a faltering heart but doctors said she was stll in danger as long as she depended on a respirator. "She is slightly better than last night. There are signs of improvement," an official at Calcutta's Woodlands Nursing Home, where the 85-year old Roman Catholic nun has been treated since last Tuesday, told Reuters. Doctors said they wanted gradually to withdraw the respirator, which they said amounted to a life support system for the missionary and Nobel Peace Prize winner, who turns 86 on Tuesday. With a gentle wave of her hand, Mother Teresa blessed a group of nuns who visited her on Sunday evening after her condition improved slightly. Dr S.K. Sen, medical director of Woodlands Nursing Home, said Mother Teresa, known for her devotion to the poor and destitute, was still not able to speak. "Mother Teresa had no further cardio-vascular problems during the day, though her heart rate is still irregular," Sen said on Sunday evening. The hospital said the next official update on Mother Teresa's health was expected at 12 noon (0630 GMT). Mother Teresa was admitted to the hospital with a high fever and severe vomiting. Her fever has abated and the vomiting stopped, but her heart continued to beat irregularly, doctors said. 3471 !GCAT !GPOL !GVOTE Conservative New Democracy party leader Miltiadis Evert has asked for three televised debates with socialist Prime Minister Costas Simitis, New Democracy said in a statement. "The reason for proposing three debates is that Greek people must be informed on our respective positions on three crucial areas," New Democracy said. It proposed a first debate on national issues and foreign policy, a second one on social and economic policy and a third debate on institutional changes, necessary for modernisation. "It is reminded that Mr. Evert's proposal is for a series of televised dialogues and not monologues," New Democracy said. --George Georgiopoulos, Athens Newsroom +301 3311812-4 3472 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The Confederation of Greek Workers union will convene on Wednesday to pick a new president to succeed Christos Protopapas who resigned, it said in a statement. --George Georgiopoulos, Athens Newsroom +301 3311812-4 3473 !E12 !ECAT !GCAT !GPOL !GVOTE Greek Prime Minister Costas Simitis will outline his government's plans on the economy at the openning of the international trade fair in Salonika on September 7, Economy Minister Yannos Papandoniou said. "It will be a speech on the government's work in the economy and giving the perspective for the future," Papandoniou said a meeting with Simitis and Finance Minister Alexandros Papadopoulos. Papandoniou has said the economy "is the government's strong card," for the September 22 snap vote. --Costas Paris, Athens Newsroom +301 3311812-4 3474 !GCAT !GPRO British heir to the throne Prince Charles found himself under attack on Monday as speculation mounted that he might try to win over a hostile public and marry his long-term mistress. Just two days before his divorce from Princess Diana becomes final, Charles was criticised by church leaders and parliamentarians as it became clear he had no intention of ending his 26-year love affair with Camilla Parker Bowles. Publication on Sunday of a picture of him spending the weekend with Parker Bowles and two other friends re-kindled speculation that he may try to persuade Britons to accept his mistress. "It is safe to say that for the time being, and perhaps for several years ahead, such a marriage would not be acceptable," said constitutional expert Lord Blake "The real difficulty is that the concept of Queen Camilla will take a long time to seem right or proper to a large part of the nation which is still very sharply divided in its attitude to Princess Diana," Blake added. Charles said last year when Parker Bowles herself was divorced that he had no intention of marrying again. But on Monday bookmakers William Hill slashed the odds on re-marriage before the year 2000 to 2/1 from 5/1. Charles's relationship with Parker Bowles, 49, has dismayed many Britons who cannot understand how he could prefer the older, frumpy blonde to the glamorous, fashion-conscious Diana. His standing as future king slumped in 1993 after publication of an phone conversation allegedly between the lovers in which Charles declared a wish to live inside Parker Bowles' trouser and be reincarnated as a tampon. Charles, 47, first met Parker Bowles in 1970 and according to tabloid press reports has thrown himself back into the relationship since starting divorce proceedings from Diana. He is recently said to have bought her a diamond ring, a horse and sent her daily bunches of red roses. Despite the obstacle of replacing Diana with Camilla, Charles as king would also be supreme governor of the Church of England, which frowns upon the re-marriage of divorcees. A Sunday Telegraph survey showed bishops were strongly against against Charles re-marrying, believing it would be difficult for Christians to tolerate. "Many Christians feel that a marriage once made cannot be ended, so remarriage is not possible. It would cause considerable unhappiness and bring tensions to the surface," said Bishop of Manchester Christopher Mayfield. The Sun newspaper on Monday said Camilla's loyalty and discretion -- she has turned down huge offers for her story -- had earned her the right to be queen. But the newspaper said it was too soon for Charles to "flaunt" Camilla. "Britain is not ready for Camilla stepping out on Charles's arm. In five years, maybe 10, it may be a different story. Meanwhile Diana on Monday denied reports that she had agreed to give an interview to top U.S. chat show host Barbara Walters. "The Princess of Wales has no plans at the moment to be interviewed by Barbara Walters," said a statement issued by her office. A report in the Daily Express said Diana would take a fee of around 750,000 pounds ($1.1 million) for an interview with Walters which would be shown in November. Diana, who admitted infidelity during a ground-breaking interview with Britain's BBC television last year, has agreed to a confidentiality clause as part of her divorce settlement. 3475 !GCAT !GHEA !GSCI Digitalis, a popular heart drug derived from a common garden flower, still stands up pretty well against sophisticated modern pharmaceuticals, doctors said on Monday. Heart specialists attending the European Congress of Cardiology in Birmingham debated just what aspects of heart disease digitalis was good for -- but they agreed the old-fashioned treatment still had its uses. The artist Vincent van Gogh was prescribed digitalis and painted his doctor holding the foxglove plant from which it is extracted. But the drug has been subjected to few clinical trials, perhaps because of its venerable reputation. Richard Gorlin of the Mount Sinai Medical Centre in New York headed a study of 8,000 patients given a drug derived from digitalis, called digoxin, for congestive heart failure -- when the heart does not pump effectively and blood backs up in the system. He said digoxin had little effect on deaths. "There was no impact on mortality," he told a news conference. But, he said, 25 to 30 percent fewer patients had to be hospitalised for congestive heart failure -- indicating that the drug was doing some good. Patients were, however, hospitalised for other problems at the same rate as heart patients not given digoxin. William Littler, chief of cardiology at the Queen Elizabeth Hospital in Birmingham, said digoxin made patients feel better even if it did not lengthen their lives. "Digoxin clearly improves symptoms," he said. He said the nature of heart disease had changed in the 200 years since digitalis was first prescribed by an English doctor intrigued by the success of an old woman herbalist. There were fewer cases of rheumatic heart disease arising from fevers and more cases of coronary heart disease, which is often related to a high-fat diet. He said digoxin was still one of the best drugs for heart arrhythmias, or irregular heart-beat rhythms, which affect 15 percent of westerners over the age of 70. Thomas Smith from Brigham and Women's Hospital at Harvard University in Massachusetts said multiple drugs were now used to treat heart disease, including angiotensin-converting enzyme (ACE) inhibitors, beta-blockers and even aspirin and diuretics. Their effects on one another were not yet clear. He said those same drugs allowed doctors to prescribe digoxin in lower, less toxic doses, making it more useful. Smith said doctors were still not sure how digitalis works. It was clear, he said, that it strengthened heart contractions and it might affect hormones important to heart function. 3476 !C23 !CCAT !GCAT !GHEA !GSCI Brazilian researchers said on Monday they had found more evidence that red wine can reduce the risk of heart disease. Tests on rabbits showed that both red wine and alcohol-free red wine stopped fats in the blood from clogging up the arteries. Carlos Vicente Serrano and colleagues at the Instituto de Coracao do Hospital das Clinicas da FMUSP in Sao Paulo took 30 rabbits and gave them a special high-fat diet. One group also got red wine, 10 got alcohol-free red wine and 10 got no extra tipple. After 12 weeks the rabbits were killed and their arteries inspected. The researchers told the European Congress of Cardiology meeting in Birmingham, England that the results showed red wine seems to have some sort of "magic ingredient" that protects against heart disease. "The results showed that animals treated with diet alone had 60 percent of the surface of their aortas (the main artery leading from the heart) covered by atherosclerotic plaques, while in the wine-treated animals only 38 percent of the aorta was covered by plaques," they said in a statement. Rabbits who got the non-alcoholic red wine came in-between, with about 48 percent of their arteries clogged up with fat. All the rabbits had extremely high blood cholesterol levels, which indicated that the red wine was stopping the blood fat from turning into the gummy plaque that typifies atherosclerosis. Serrano's group said this could be because something in the red wine stops the fat from oxidising -- a chemical reaction similar to rusting that turns the fat into plaque. "Probably flavonoids, such as apigen and luteonin -- substances that are present in fruits and vegetable of the so- called Mediterranean diet, and that are also present in red wine, may be responsible for some of these effects," they said. "It is noteworthy that both red wine and non-alcoholic products of red wine were benefeicial, but wine by itself a little more so," they concluded. Last year British researchers said a moderate intake of any kind of alcohol seemed to protect against heart disease. They said they found no particular benefit in red wine and said any more than about two drinks a day erased the benefits. 3477 !GCAT !GENT !GPRO Princess Diana on Monday denied reports that she had agreed to give an interview to top U.S. chat show host Barbara Walters. "The Princess of Wales has no plans at the moment to be interviewed by Barbara Walters," said a statement issued by her office. A report in the Daily Express said Diana would take a fee of around 750,000 pounds ($1.1 million) for an interview with Walters which would be shown in November. Walters has been trying to interview Diana for years. They have had lunch together and she has been to Diana's Kensington Palace home. Diana, who admitted infidelity during a ground-breaking interview with Britain's BBC television last year, has agreed to a confidentiality clause as part of her divorce settlement from Prince Charles. The divorce becomes final on August 28. ($1=.6436 Pound) 3478 !C21 !C24 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Canada's Prairies saw no frost on Monday morning and none was expected anywhere on the grainbelt until late in the Labour Day long weekend, Environment Canada said. "Apparently, we're home free for the rest of the week. We're not calling for any frost until after the weekend when it starts to cool off in northwestern Alberta after the weekend probably Monday or Tuesday," meteorologist Gerald Machnee told Reuters. Sprague, Manitoba, on the Minnesota border was the cold spot of the Prairies Monday morning at 4.0 Celsius (39.2 F). Temperatures at ground level can be 2.0 to 5.0 Celsius lower than at chest level depending on windspeed, sky conditions and ground surface moisture. Freezing occurs at 0 Celsius (32.0 F). North Battleford, Sask., reported a low of 5.0 Celsius (41.0 F) and Grande Prairie, Alta., in the Peace River Valley reported 7.0 Celsius (44.6 F). Machnee dismissed talk of frost Wednesday by proponents of the "full moon, frost soon" school of thought. Lows on August 28 across the Prairies should range from 8.0 to 12.0 Celsius with highs around 30.0 Celsius. -- Gilbert Le Gras 204 947 3548 3479 !GCAT The following are top headlines from selected Canadian newspapers. Reuters has not verified these stories and does not vouch for their accuracy. THE GLOBE AND MAIL: - Conservative leader Jean Charest gathers election planks: Tories' formula for rebuilding includes tax cuts, plenty of room to manoeuvre. The federal Progressive Conservatives have proclaimed their own resurrection and are now intent on winning Canadians' endorsement of their rebirth in the next election. - Let courts be last resort, study says: Bar task force backs alternatives. Courtroom trials should be the last resort instead of the first opportunity for people to resolve their civil disputes, says a major study of the choked and costly Canadian civil-justice system. - Wilderness pushes teams to extreme: In the remote Pemberton Valley of British Columbia's coastal-range mountains, a 500-kilometre, eight-to-10 day expedition-style race, the Eco-Challenge has begun. Half the 375 competitors will not finish. - S. Korean coup leaders guilty of treason: Ex-president Chun sentenced to death, Roh to 22-1/2 years in prison. - Niagara wine country uncorks a feud: Vintners want a tourist mecca; hard-pressed fruit farmers want the right to sell to developers. Report on Business Section: - Bank profits levelling, analysts say. Third-quarter earnings expected to show weaker growth as Big Six set to deliver results. - U.K. sale reveals pitfalls of privatization: Experience an example for Canadian governments considering Crown selloffs. - On-line news on the rise: While many believe newspapers will survive, some readers are turning to electronic services. - Investors urgest to re-examine forest sector: After a period of disenchantment, forest products analysts are urging their clients to move selectively back into the sector. THE FINANCIAL POST: - Did Canada Deposit Insurance Corp do its job in trust sale? Doubts persist over price paid for North American Trust's property assets. - Entertainment giant Polygram NV vows to invest if Ottawa eases film policy. - U.S. freezes Friedland's Inco shares over cleanup. The U.S. Environmental Protection Agency, in connection with a toxic spill in Colorado, has won a court order freezing US$152-million worth of Inco Ltd stock held by promoter Robert Friedland. -- Reuters Toronto Bureau 416 941-8100 3480 !C12 !CCAT !GCAT !GCRIM Brush Wellman Inc said Monday that 10 of 24 lawsuits involving chronic beryllium disease have been dismissed since July 1. The leading U.S. beryllium producer said in a conference call it has traditionally been pro-active regarding the workplace disease, a lung ailment which can affects a small percent of people whose immune systems are susceptible. Of the 14 remaining suits, 10 were filed by employees of industrial Brush Wellman customers and Brush Wellman liability in such suits is typically covered by insurance, Timothy Reid, vice president of corporate communications, said on the call. The company was responding to an article in Sunday's New York Times. He said the article largely reiterated information about the suits and the disease which had previously been made public via Securities and Exchange Commission filings and annual reports. "Brush Wellman has been a leader in dealing with health and safety issues (related to chronic Beryllium disease) for nearly 50 years," he said. "We have a record of going beyond regulatory requirements ... and we consistently share the most current information available ... with customers and employees." The customer employee suits were filed in 1990-95, he said. A class action filed by a former Brush Wellman employee in April 1996 was dismissed in July, he said. The company is "vigorously defending" the remaining four suits filed by former and current Brush Wellman employees, he said. After a delayed opening, the stock was off 1-1/2 to 18-7/8. --Cleveland Newsdesk 216-579-0077 3481 !GCAT !GDIS !GWEA Hurricane Edouard, the most powerful hurricane of the 1996 Atlantic season, is likely to bypass the Caribbean and head straight up the Atlantic to Florida and the Eastern Seaboard, the National Hurricane Service said Monday. Edouard, an "extensive" Category 3 hurricane packing 130 mile-per-hour (210 kph) winds, was situated in the mid-Atlantic about 600 miles (960 km) east of the Leeward Islands at 5 am EDT (0900 GMT) Monday, said Fiona Horsfall of the hurricane center. "It's a good strong hurricane so we are concerned," she said, adding it is more likely to remain in the Atlantic on its northbound course rather than head west into the Caribbean. "At the moment it looks like it will pass to the north and probably be a bigger threat to the mainland United States. At its current course, it's possible it could hit Florida or the eastern seaboard," Horsfall said. "It would have to make some odd turns at this point to end up in the Caribbean," she said. "Our 72-hour forecast has it north of the Dominican Republic and east of the Bahamas, still in the Atlantic," she said, cautioning, "it's an atmospheric phenomenon so it can change direction at any time." She said Edouard was moving west-northwest at about 15 mph (24 kph) and was situated at 17.7 degrees north and 52.7 degrees west. Horsfall noted Edouard was "slightly downgraded" Monday morning from an "Extreme" Category 4 hurricane to an "Extensive" Category 3 after its winds abated slightly from 140 mph (225 kph) to 130 mph (210 kph). But she added, "It's an insignificant difference because it can fluctuate up and down between Category 3 and Category 4." Hurricanes are given a Category 3 label when their winds range between 111 and 130 mph. Category 4 storms brandish winds of 131-155 mph, with gusts often far stronger. Four years ago on August 24 another Category 4 storm, Hurricane Andrew, slammed into south Florida. He left 250,000 people homeless and gained infamy as the most expensive catastrophe on record, with $15.5 billion in property damage. Horsfall noted that 1996 has been a "fairly quiet" season so far, with only three Atlantic tropical storms garnering the 75 mph (120 kph) winds necessary to become full-fledged hurricanes: Bertha, Cesar and Dolly. None caused extensive damage, although Bertha killed nine people on her mid-July sweep through the Caribbean and onto the shores of North Carolina. -- New York Energy Desk 212 859-1620 3482 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Tegal Corp said it would reduce its global workforce by 12 percent. The company said that the semiconductor capital equipment industry experienced a slowdown of orders due to excess capacity. As a result, Tegal agreed to adjust its employment to its current level of business. The company expects quarter to quarter revenues and earnings to decline below current analyst estimates, beginning this quarter, and that these declines will be commensurate with what is happening in the industry as a whole. -- New York Newsdesk 212-859-1610. 3483 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Tosco Corp said Monday it had a tentative agreement with the union representing workers at the mothballed Trainer Refinery, located south of Philadelphia. The company announced plans to reopen the refinery at Marcus Hook, Pa., July 30, saying the proposal was contingent on having a satisfactory agreement with organized labor. Tosco said a written agreement has been reached with the Oil, Chemical & Atomic Workers Union Local and International. This agreement, if ratified by the local workers, would provide the labor certainty the company requires. The ratification vote is expected to be completed this week, the company said. The refinery would employ a workforce of about 360, of which 215 would be union jobs. The company statement had no details on the agreement. It quoted chief executive Thomas D. O'Malley as saying "We are pleased that constructive, cooperative discussions have led to an agreement that should allow this idled facility to be a productive and profitable contributor to Tosco's refining business." Tosco purchased the refinery from British Petroleum Co Plc for $60 million early this year and plans a $50 million modernization. BP acquired the refinery from Sinclair in 1969 when that company merged with Atlantic Richfield Co, which already had a South Philadelphia refinery. -- Jim Brumm 212-859-1710. 3484 !C13 !C24 !CCAT !GCAT !GENV The New York Power Authority's 965 megawatt (MW) Indian Point 3 nuclear power plant in Buchanan, New York, reduced power to 61 percent over the weekend due to a leak, the Nuclear Regulatory Commission (NRC) said Monday The unit was operating at 61 percent power as of early Monday morning, according to the NRC's daily plant status report. Power was "reduced to check RCS leakage increase," the report said. The company was not immediately available for comment. --New York Power Desk 212-859-1624 3485 !C13 !C23 !CCAT !GCAT !GHEA Neurogen Corp said on Monday that in a Phase I clinical trial, its obesity drug NGD 95-1 has proved safe and well tolerated across a broad dose range. The drug is being co-developed with Pfizer Inc. Neurogen is conducting Phase I clinical trials under Pfizer's auspices under a collaborative agreement concluded in November 1995, the company said. Neurogen said it plans to initiate a follow on Phase I multiple dosing safety study early in 1997 and expects Pfizer to start Phase II studies to determine the drug's efficacy sometime in mid-1997. NGD 95-1 is an orally active small molecule antagonist of NPY receptors, which are strongly linked to appetite. It is used for the treatment of eating disorders, including obesity and binge eating disorders, the company said. The Phase I trial was conducted on over 75 overweight but otherwise healthy volunteers, the company said. 3486 !C11 !C12 !C13 !C17 !CCAT !GCAT !GCRIM Lloyd's of London said 75 percent of its worldwide membership had accepted the terms of its 3.2-billion-pound ($4.7 billion) settlement offer by midday Saturday, The Wall Street Journal reported on Monday. The announcement followed an appeal launched on Saturday to overturn a federal ruling against the insurance giant's rescue plan. On Friday, U.S. District Judge Robert Payne blocked Lloyd's from imposing its rescue plan on dissident U.S. investors and ordered a trial on charges the insurer withheld critical financial information on the planned restructuring of the insurance market. However, the judget did not block U.S. investors from accepting the deal if they chose to do so. Payne issued an injunction extending the deadline for U.S. members to accept or reject the settlement offer to October 30 from August 28. He also found Lloyd's in violation of U.S. securities laws, because the firm used the mail to recruit U.S. investors' support for the restructuring plan. About 2,700 of Lloyd's 34,000 worldwide members are American, a Lloyd's spokesman told the newspaper. He said some U.S. members had accepted the terms, but would not specify how many of the approximately 25,500 members who have accepted the terms are U.S. members. Lloyd's investors, or "names," must pledge their entire net worth to make good on the insurance policies they agree to underwrite. Lloyd's chairman David Rowland said, "At 75 percent valid acceptances with four days to go before the deadline of 12 noon, Wednesday, August 28, I'm confident that, by the deadline, the offer will have been accepted by the overwhelming majority of members." -- New York newsroom, (212) 859-1610 3487 !GCAT !GWEA Two storms threaten shipping in the western Pacific Ocean. Typhoon Orson is expected to track northeastward from near 25n/150e to near 28n/152e during the next 48 hours, over open waters. Top winds, now near 130 mph, are expected to increase to near 150-155 mph this period. Orson is a major threat to shipping. Tropical Storm Piper is weakening and transitioning into an extratropical weather system. The storm is currently near 41.2n/159.0e and will likely become extratropical within 12-24 hours. Piper will not be as dangerous to shipping as Orson but will continue to be a moderate risk at least for the next 24 hours. Dangerous Hurricane Edouard is a threat only to shipping at this time. The storm has top winds of 140 mph and is centerd 650 miles east of the Leeward Islands in the Atlantic Ocean, moving to the west northwest at 15 mph. This motion is expected to continue during the next 24-36 hours as the storm changes little in strength. The current longer range forecast track for the storm keeps it to the northeast of the Leeward Islands, but this will have to be watched closely but all interests in the Leeward Islands should monitor this situation closely. There are no further statements at this time. 3488 !C12 !C24 !CCAT !GCAT !GCRIM Avatar Holdings Inc said its utilities subsidiary Florida Cities Water Co had been fined $309,710 for minor technical violations of the federal Clean Water Act. In a statement on Friday, the company said the fine was part of a judgement by the U.S. District Court for the Middle District of Florida. The ruling found Avatar not liable in a 1993 civil suit under the Clean Water Act by the U.S. Department of Justice on behalf of the Environmental Protection Agency. The government had sought $4.8 million from Avatar for violations of the act. The court noted that the government said no environmental harm had resulted from the violations. -- New York newsroom (212) 859-1610 3489 !GCAT !GPOL PLO officials said on Monday Israel had no right to demand closure of three Palestinian offices in Arab East Jerusalem but it had shut two to deprive Israel's prime minister of any excuse to slow peace moves. They rejected Israel's charge the offices were carrying out activities of the Palestinian Authority, which according to an interim peace accord is restricted to working in self-rule enclaves set up under the deal in Gaza and the West Bank. "When these offices, which they claim are Palestinian Authority offices, are closed, we will strip Israel of any false excuses to continue freezing the peace process," one official of the Palestine Liberation Organisation (PLO) said. "We expect Israel now to reopen talks and to fulfil its commitments," he said. Israeli Prime Minister Benjamin Netanyahu's office meanwhile denied a report by Israel's state-run Channel One that said he would meet Palestinian President Yasser Arafat in two weeks. Netanyahu has said he will hold talks with Arafat only when he deems it necessary for Israel's security. Israeli President Ezer Weizman, answering a "distress" call from Arafat, said on Sunday he would invite the Palestinian leader to his home but set no date. Weizman made the announcement at a hurriedly called news conference with Netanyahu hours after a newspaper said he had threatened to meet Arafat over Netanyahu's objections. PLO officials said Israel demanded the Authority shut the Jerusalem offices at a meeting between Netanyahu envoys and Palestinian officials in Gaza last week. They said the envoys pledged in return to resume peace talks and implement a redeployment of Israeli troops in the West Bank town of Hebron agreed by Israel's previous government in a signed accord. Palestinians view the Hebron withdrawal as a litmus test of Netanyahu's intentions on Middle East peace moves. The Israeli envoys said peace talks, stalled since Netanyahu's election in May, would resume before September 2. The offices closed were the Maps and Survey Department and the Sports and Youth Office. The head of a third institution Israel had demanded be closed, a vocational school, is continuing to refuse to close his organisation. PLO officials said all the offices which Israel wanted closed were licensed by previous Israeli governments and were set up before the 1993 PLO-Israel peace deal. A Palestinian lawmaker who angered Israel at the start of August when he opened an office in his home in East Jerusalem said on Monday city taxmen seized his furniture. He said the move came despite his having a payment plan for the taxes. A Jerusalem city spokeswoman said there was no payment plan and rejected Hatem Abdel-Qader's charge of harassment. Israel captured East Jerusalem in the 1967 Middle East war and later annexed it against international opposition. It has declared both halves of the city its eternal capital. Palestinians view East Jerusalem as the capital of a future state. The city's fate is up for negotiation at final peace talks which have yet to resume under Netanyahu. 3490 !GCAT !GCRIM !GPOL A Turkish court has indicted top members of a Kurdish party for forming an armed separatist gang in a case reminiscent of an earlier trial of Kurdish MPs that badly damaged Ankara's shaky rights record. "They have brought charges. The allegations are extremely serious," Sedat Aslantas, a lawyer of the People's Democracy Party (HADEP), told Reuters on Monday. HADEP lawyers said 41 people had been indicted, including party leader Murat Bozlak and other executives, many of whom are to be tried under article 168 of the penal code, which has a maximum jail sentence of 22-1/2 years. The trial could bring further problems for Ankara abroad over its human rights credentials and undermine promises by Islamist Prime Minister Necmettin Erbakan to improve justice and tackle a 12-year Kurdish insurgency in the spirit of "brotherly love". "The hawks are still in control in Turkey," said political analyst Mehmet Altan. Erbakan, two months into his premiership, did not look like he could combat the hardline military thinking that dominates Turkish state affairs, Altan said. Sirri Sakik, a prominent Kurdish politician, is to be tried under Article 8 of the anti-terror law -- against separatist propaganda -- which has a maximum three-year jail sentence and is often used to limit discussion of the Kurdish issue. Sakik was tried and sentenced alongside six other MPs of the pro-Kurdish Democracy Party (DEP) in 1994 in a trial that sparked widespread condemnation from Turkey's Western allies and hindered Ankara's efforts for closer ties with Europe. Four of the six, including Nobel-prize nominee Leyla Zana, are still in jail on 15-year sentences under article 168, which punishes leading an armed group formed to divide the country. "It looks like this could go the way of DEP," Aslantas said. "The charges are similar. The prosecutor has turned his political views into an indictment. There is no proof." He said the prosecution's evidence was largely based on speeches by HADEP members. DEP lawyers had charged the same. After the DEP trial, Turkey was pressed by Europe to improve its rights record as a condition for signing a customs union deal. It changed its 1992 military-era constitution and slightly eased Article 8, allowing the deal to go into effect in January. But rights activists and lawyers say the changes were cosmetic and failed to address the core of the problem. "The mentality at the time of DEP has not changed a jot. I can see HADEP going to the constitutional court," Aslantas said. HADEP was formed after DEP was closed down by Turkey's constitutional court in 1994 and its 13 MPs thrown out of parliament for alleged links with the Kurdish separatists. Twenty-eight of the defendants have been in jail since June after masked youths tore down a Turkish flag at a party congress and replaced it with the banner of the rebel Kurdistan Workers Party (PKK) and a poster of its leader, Abdullah Ocalan. More than 20,000 people have been killed since 1984 in the PKK's fight with the army for control of the southeast. "In the indictment we say HADEP worked as a recruitment office for the PKK," prosecutor Nuh Mete Yuksel said. He said HADEP gave pro-PKK training and that it was clear from Ocalan's speeches on pro-Kurdish television and speeches by HADEP members that the party was trying to legitimise the PKK. "And the latest lowering of the Turkish flag in public is an example of this," Yuksel told Reuters. A man was arrested on Monday by Ankara state security court over the flag incident, Anatolian news agency said. Faysal Akcan faces the capital charge of treason. Turkey's sensivity towards its red-and-white national flag was demonstrated earlier this month when a Greek Cypriot protester was killed trying to tear down a Turkish flag on land controlled by Turkish Cypriots. "There will be little reaction to the trial at home as this is hidden behind the flag business," said Altan. "But DEP was a legal scandal...And Europe will be looking more closely to see what this new trial is all about." 3491 !GCAT !GVIO Suspected Moslem militants killed six people - including three Christians -- and wounded two others in two separate incidents in southern Egypt, security sources said on Monday. They said four people were killed and one wounded in the first incident when gunmen burst into the house of a community leader in a village in Abu Qurqas, about 240 km (150 miles) south of Cairo, on Sunday and opened fire. The community leader was not in the house at the time. The Interior Ministry said in a statement that three of the people killed in the attack were Christians. Security sources said the gunmen then escaped to the province of Beni Suef, further north, where they killed a police guard when he apprehended them in a house they were using as a hideout. The gunmen threw a fishing net over him and shot him dead, the ministry said. It said the gunmen killed a man and wounded another while they were making their getaway. Police in southern Egypt believe the gunmen belonged to the militant Gama'a al-Islamiya (Islamic Group), which has been fighting to overthrow the government and set up a strict Islamic state since 1992. Militants have targeted senior government officials, policemen, Christians and sometimes tourists in their anti-government campaign. About 1,000 people, mainly militants and policemen, have been killed in political violence in Egypt over the last four years. 3492 !GCAT !GVIO A Turkish court has indicted leading members of a Kurdish party for allegedly forming an armed separatist group, lawyers and court officials said on Monday. "Forty-one people have been indicted. (Party leader) Murat Bozlak and other executives are to be tried under article 168, and Sirri Sakik under article 8 of the anti-terrorism law," a lawyer of the People's Democracy Party (HADEP) told Reuters. Sakik, a prominent Kurdish politician, was tried and sentenced alongside six other MPs of the pro-Kurdish Democracy Party (DEP) in 1994 in a trial that brought on wide-spread condemnation from Turkey's Western allies and hindered Ankara's efforts for closer ties with Europe. Four of the six, including Nobel-prize nominee Leyla Zana, are still in jail, serving out their 15-year sentences under article 168, which punishes leadership of an armed group formed to divide the country. Twenty-eight of the HADEP members have been in jail since June after masked youths tore down a Turkish flag at a rowdy HADEP congress and replaced it with the banner of the guerrilla Kurdistan Workers Party (PKK). The court on Monday brought capital charges against a man accused of insulting the Turkish flag during the HADEP congress, the state-run Anatolian news agency reported. "Faysal Akcan admits his guilt," prosector Nuh Mete Yuksel was quoted as telling Anatolian. Akcan faces charges of "treason and crimes against sovereignty and the nation state," which carry a maximum sentence of death. More than 20,000 people have been killed in the 12-year fight between the PKK -- seeking autonomy or independence in southeast Turkey -- and the army. "In the indictment we said that HADEP worked as a recruitment office for the PKK," Yuksel said. HADEP was formed after DEP was closed down by Turkey's constitutional court in 1994 and its 13 MPs thrown out of parliament for alleged links with the PKK. Turkey's sensivity towards its red-and-white national flag was demonstrated earlier this month in Cyprus during Greek Cypriot protests against the division of the island. A Greek Cypriot was shot dead by Turkish security forces as he tried to tear down a Turkish flag in the divided island's U.N.-patrolled buffer zone. Following the killing, Turkish Foreign Minister Tansu Ciller vowed that Turkey would "break the hands" of anyone insulting the flag. Subsequent criticism of the incident by U.S. State Department spokesman Nicholas Burns, who said the flag is only a "piece of cloth" worth less than human life, outraged public opinion in Turkey. 3493 !GCAT !GCRIM A 17-year-old Egyptian got more than he bargained for when a woman he had spread rumours about bit off his tongue on Monday, security sources said. They said Alaa Hassan met his fate when the woman, Bothaina Ahmed, 39, persuaded him to help her in the fields in their village near Zefta town in the central Nile Delta. She began kissing him but then bit off his tongue. Ahmed told police Hassan had been spreading rumours about her alleged immoral behaviour in the village. Police charged her with assault. Hassan was taken to hospital. It is not clear if he was able to make a statement. 3494 !GCAT !GVIO A Maoist rebel group has killed three of its own members in Turkey's eastern province of Tunceli after charging them with spying for the state, a local offical said on Monday. "The Turkish Workers and Peasants Liberation Army killed its three members on Sunday, accusing them of being the state's spies," the mayor of Tunceli province's Ovacik district, Musa Yerlikaya told Reuters. He said the group left notes by the bodies saying "these peoples were executed due to their collaboration with the state." The hardline Maoist group has been targeting soldiers, policemen and village chiefs in the province since the 1970s but its attacks have been limited in recent years. Tunceli is a stronghold of the rebel Kurdistan Workers Party (PKK), which is fighting for control of southeast Turkey. More than 20,000 people have been killed in the fight between the PKK and the army. 3495 !GCAT !GDIP !GVIO Israel gave a muted response on Monday to reports of a Syrian troop redeployment in central Lebanon, saying there was no reason for panic. The Beirut newspaper an-Nahar said Syrian vehicles, including tanks, were seen on Saturday night moving from the mountainous Metn region northeast of Beirut and other areas towards the Beirut-Damascus highway. Lebanese security sources described the redeployment as a defensive move against feared Israeli air attacks. Asked about the newspaper report, Israeli Foreign Minister David Levy warned against misinterpreting "training exercises" and said: "As for manoeuvres, we are used to this, following it and we must not get into any panic here." Syria has an estimated 35,000 troops stationed in two-thirds of Lebanon helping the Beirut government maintain security. They face Israeli troops at a distance of five-10 km (three to six miles) at the southern end of the eastern Bekaa valley. Unexpected Arab troop movements have sounded alarm bells in Israel since it was surprised by Syrian and Egyptian attacks that started the 1973 Middle East war. Syria's fears have grown of an Israeli attack on its forces in Lebanon since Prime Minister Benjamin Netanyahu took office in May saying he would not return the Golan Heights to Syria. Netanyahu appeared to threaten Syria last week when he visited a south Lebanon border strip held by Israeli troops. He said attacks on the Israelis and their local militia allies by Hizbollah guerrillas, who are supplied through Syria, would cause an escalation of the situation. Israel's Yedioth Ahronoth newspaper reported last week that tensions with Syria arose largely from "irregular" movements by Syrian army units from the Bekaa valley to Syria itself. 3496 !E41 !ECAT !GCAT !GJOB !GPOL !GWELF Turkey's parliament will hold an emergency session this week to discuss the abolition of a widely-criticised state savings scheme, government officials said on Monday. The plan, the latest in a series of populist moves by the Islamist-led coalition, has prompted debate on ways of repaying funds paid in to the scheme and how to replace it with a more productive savings method. "The idea was to raise money for investments but the funds were not used sensibly and the scheme has failed," said Global securities strategist Volkan Sari. He said the fund had met opposition from unions because the money was not invested sensibly and the returns were below market levels. Analysts said the abolition of the scheme is likely to be welcomed by workers who will see an immediate benefit to their wage packets and employers, whose wage costs will fall. Since the scheme was set up in 1988, workers have paid two percent of their salaries and employers contributed a further three percent. The question of fund repayment on Monday brought Employment and Social Security Minister Necati Celik together with union leaders ahead of a meeting in parliament at 3 p.m. (1200 GMT) on Tuesday. "There will be discussion of how the remaining 428 trillion (lira) will be paid back," said Osman Arolat, columnist with the financial daily Dunya. The government has not provided figures on the size of the fund. Analysts said Celik will try not to alienate unions after populist measures since the government came to power late in June. "We don't want to be involved in any actions which will upset workers, employers associations or the people in general," Celik was quoted as saying by the state-run Anatolian news agency. Civil servants have been given a larger-than-expected wage rise and the minimum wage was doubled, raising concerns about the government's commitment to rein in Turkey's gaping deficits. Annual inflation in Turkey is running at over 80 percent and the 1996 budget deficit is expected to total 1,300 trillion lira. Global's Sari said the fund abolition will not be of any positive benefit to the economy as the government still has to make payments to workers and will have to consider alternative savings measures. The government will be reluctant to pay out the funds rapidly at a time when it is intrdocing measures aimed at raising revenues, analysts said. Minister Celik on Monday trumpeted the immediate financial benefit of the abolition to employers, whose wage bills will fall by three percent. "In this way the national economy and industrialists will acquire more power against competition," Celik said. 3497 !GCAT !GENT Egypt has finished 10 months of renovation and ventilation work inside the Pyramid of Chephren, the second of the three Giza pyarmids, and will reopen it to the public on Wednesday, officials said on Monday. The state's Supreme Council for Antiquities closed the pyramid last October after a block of stone broke off the wall of Chephren's burial chamber and it has spent about one million pounds ($300,000) on the works, they said. The council took the opportunity to install a ventilation system to reduce the humidity generated by the hundreds of people who went inside the pyramid. As in other pyramids, the high humidity was damaging the limestone walls of the interior. The water condenses on the walls and draws out the salts in the stone. The nearby Great Pyramid of Cheops had a similar ventilation system installed in 1990/1. The chairman of the council, Abdelhalim Noureddin, told Reuters that the third pyramid, that of the pharaoh Mycerinus, would soon receive the same treatment. The council will also open to visitors one of the three small pyramids Cheops had built for his wives, he said. Chephren, the fourth pharaoh of the fourth dynasty, ruled Egypt in the 26th century BC. His pyramid is slightly smaller than that of Cheops, who was his father. 3498 !GCAT !GCRIM !GPOL Israel's Jerusalem municipality on Monday seized the furniture of a Palestinian lawmaker who had irked the Israeli government by opening an office in his home in the Arab half of the city, the legislator said. Hatem Abdel-Qader said police who carried out the raid told him they were acting on orders from Israeli Mayor Ehud Olmert because Abdel-Qader owed the city property taxes. Abdel-Qader said a combined force of police, paramilitary border police and city officials hauled away his living room and dining room furniture as well as electrical appliances. "This seems like an attempt to settle accounts with me. They want to put finanical and psychological constraints on me. But I will stay even if I have to sleep on the bare floor," he said. Abdel-Qader said the move came despite his having worked out an agreement earlier to pay the tax by installments. A city spokeswoman said: "It was a decision made by the courts some time ago. This is not a decision made by the mayor specifically...the tax people know of no agreement to pay by installments." Abdel-Qader angered Israel at the beginning of August when he announced he had opened an office in Arab East Jerusalem. The Palestinian Authority, according to an interim peace accord, is restricted to working in self-rule enclaves set up under the deal in the Gaza Strip and the West Bank. Israel demanded the lawmaker close the office. In the end a deal was reached allowing the office to remain as long as it was used for private purposes. Israel's previous government turned a blind eye to Palestinian offices in the city as it encouraged massive building of housing for Jews in Arab East Jerusalem. Prime Minister Benjamin Netanyahu's government has not stopped the building in East Jerusalem for Jews but it is insisting Palestinian offices it claims carry out Authority work be shut. Israel captured East Jerusalem in the 1967 Middle East war and later annexed it. It has declared both halves of the city its eternal capital. Palestinians want East Jerusalem as the capital of a future state. The city's fate is up for negotiation at final peace talks which have yet to resume under Netanyahu. 3499 !GCAT !GDIP !GVIO Iran dismissed as baseless Berlin court testimony by former Iranian president Abolhassan Banisadr that Tehran ordered the deaths of dissidents in Germany. But a Tehran newspaper warned of damage to relations between Iran and Germany, the Islamic republic's largest trade partner in Europe. Banisadr, who fled Iran in 1981, told a German court trying five men for the 1992 restaurant murder of three Iranian Kurds and their translator that orders for the killings came from top Iranian officials. He said the Islamic republic's spiritual leader Ayatollah Ali Khamenei and top government ministers ordered the deaths with President Akbar Hashemi Rafsanjani's blessing. Tehran has consistently denied all involvement in the killings. German Foreign Minister Klaus Kinkel, who faces opposition demands to break ties with Iran, said on Saturday he would study the evidence before acting. Iranian Foreign Minister Ali Akbar Velayati, in remarks to Tehran newspapers published on Monday, said "Banisadr's discredibility is known to all." He called Banisadr's testimony baseless and added: "He lost his credit even among his own clique of anti-revolutionaries and nobody listens to him." Iran News, meanwhile, said the case would harm relations between Bonn and Tehran. It said the German judiciary had continued to create a poisonous atmosphere against the Islamic republic "and by inviting a fugitive and terrorist to Berlin and providing him with security, publicity and political facilities, offered food for propaganda to the mass media and opponents of constructive ties between Iran and Germany. "This will serve as a principal barrier in the way of promotion of the two countries' ties," the English language daily said. 3500 !GCAT !GDEF !GDIP Syrian forces in central Lebanon are re-deploying into defensive positions in case of Israeli air attacks, Lebanese security sources said on Monday. The sources were commenting on a report in the Beirut newspaper an-Nahar that Syrian vehicles, including tanks, were seen on Saturday night moving from the mountainous Metn region north-east of Beirut and other areas towards the Beirut-Damascus highway. "The change of positions of the Syrian army in the mountains and on the Syrian-Lebanese borders follows fears of an Israeli operation against these forces," an-Nahar quoted informed sources as saying. Syria has an estimated 35,000 troops stationed in two-thirds of Lebanon helping the Beirut government maintain security. They face Israeli troops at a distance of 5-10 km (three to six miles) at the southern end of the eastern Bekaa valley. Fears of an Israeli attack followed recent Israeli statements and "the attempt of (Israeli Prime Minister Benjamin) Netanyahu to change the equation and refer to the Syrian forces as just another military group in Lebanon, in order to embarrass Syria," an-Nahar said. It quoted the sources as saying any Israeli air attack would be against Syrian troops stationed deep inside Lebanon rather than on the Syrian-Lebanese border. Lebanese security sources told Reuters Syrian troops appeared to be carrying out a routine rotation of forces as well as a re-deployment in which they were vacating some exposed positions they have held for years in central Lebanon. The Syrians had left a strategic mountain crossroads at Bhamdoun on the Beirut-Damascus highway about 30 km (19 miles) south-east of Beirut, the security sources said. They also left a number of other positions including Dahr al-Beidar, the 1,550 metres (5,000 foot) pass which the Beirut-Damascus highway crosses to reach the eastern Bekaa valley. Troops of Lebanon's 63,000-strong army took over the Bhamdoun position, the sources said. They did not say where the Syrian troops re-deployed. Fears have grown of an Israeli attack on Syrian forces in Lebanon since Netanyahu took office in May saying he would not return the Golan Heights to Syria or pursue the land-or-peace formula in stalled Arab-Israeli peace talks. Netanyahu appeared to threaten Syria last week when he visited a south Lebanon border strip held by Israeli troops. He said attacks on the Israelis and their local militia allies by Hizbollah guerrillas, who are supplied through Syria, would cause an escalation of the situation. "It is not good for Syria, Lebanon, Hizbollah or Israel," Netanyahu said. Syria last week accused Israel of launching an hysterical campaign against it after Israeli television said Damascus recently test fired a missile able to hit Israeli cities. Israel's Yedioth Ahronoth newspaper reported that tensions with Syria largely arose from "irregular" movements by Syrian army units from the Bekaa valley to Syria itself. 3501 !GCAT These are some of the leading stories in the Saudi Arabian press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AL-RIYADH - A Saudi-American joint venture, Al-Jubail Petrochemical Company, plans to build a 200,000-tonne polyethylene plant and studies plans for a new ethylene plant. AL-YAUM - Agriculture and Water minister signs 14.8 million riyal deal with a local firm to operate and maintain a water project. - Shares of Riyad Bank and Saudi Cement Company lead trading in the Saudi stock market. ARAB NEWS - IBM price cuts upset computer market in Saudi Arabia. - Agricultural marketing firm to be established in Saudi next month. 3502 !GCAT !GDIP !GVIO Only Iran can bring peace to northern Iraq where a U.S.-brokered ceasefire has halted inter-Kurdish fighting, Iranian Foreign Minister Ali Akhbar Velayati said in remarks published on Monday. "Iran is the only country which can bring peace to the region," he told reporters at Tehran's Mehrabad airport on Sunday where he had gone to see off his visiting Bangladesh counterpart Abdos Samad Azad. Guerrillas of Kurdish warlord Jalal Talabani of the Patriotic Union of Kurdistan (PUK) have been fighting in northern Iraq against rebels of Massoud Barzani, head of the Kurdistan Democratic Party (KDP). Washington brokered a ceasefire on Friday and persuaded them to attend peace talks next month. Britain offered to host the talks. A similar ceasefire agreed under Washington's auspices last year failed to resolve differences between Talabani and Barzani on how to run their breakaway enclave which they have divided into two separate spheres of influence. Iranian newspapers, reporting Velayati's remarks, quoted him as saying Iran "has tried and is trying to minimise the tension in northern Iraq in the best possible way". Iran was in the best position to bring the warring parties to the negotiating table for peace, he said. "In the past we have played such a role with success. I don't think that the United States and Britain would be able to bring peace in north Iraq," Velayati said. Iraq's Deputy Prime Minister Tareq Aziz on Sunday accused Iran of taking sides in the latest flare-up and described Tehran's action as "hostile, flagrant...and harbouring serious expansionist tendencies". The ruling Baath party newspaper al-Thawra in Baghdad said U.S. policy towards Iraq encouraged "Iranian rats to leave their holes". It warned Iran not to take the current situation in the area as a pretext to meddle in Iraq's affairs. Iran sent a small force into northern Iraq last month in pursuit of Kurdistan Democratic Party of Iran (KDPI) rebels. Both Barzani and Iraq accuse Talabani of liaising with Tehran in the latest fighting. Iraq's official press has been critical of Talabani and last week published overtures to lure Barzani to Baghdad's camp. 3503 !GCAT !GCRIM !GPOL !GVIO A Turkish court has indicted leading members of a Kurdish party for allegedly forming an armed separatist group, lawyers and court officials said on Monday. "Forty-one people have been indicted. (Party leader) Murat Bozlak and other executives are to be tried under article 168, and Sirri Sakik under article 8 of the anti-terrorism law," a lawyer of the People's Democracy Party (HADEP) told Reuters. Sakik, a prominent Kurdish politician, was tried and sentenced alongside six other MPs of the pro-Kurdish Democracy Party (DEP) in 1994 in a trial that brought on wide-spread condemnation from Turkey's Western allies and hindered Ankara's efforts for closer ties with Europe. Four of the six, including Nobel-prize nominee Leyla Zana, are still in jail, serving out their 15-year sentences under article 168, which punishes leadership of an armed group formed to divide the country. Article 168 has a maximum jail sentence of 22-1/2 years. Article 8 has a maximum sentence of three years. Twenty-eight of the HADEP members have been in jail since June after masked youths tore down a Turkish flag at a rowdy HADEP congress and replaced it with the banner of the guerrilla Kurdistan Workers Party (PKK). More than 20,000 people have been killed in the 12-year fight between the PKK -- seeking autonomy or independence in southeast Turkey -- and the army. "In the indictment we said that HADEP worked as a recruitment office for the PKK," Ankara state security court prosecutor Nuh Mete Yuksel said. HADEP was formed after DEP was closed down by Turkey's constitutional court in 1994 and its 13 MPs thrown out of parliament for alleged links with the PKK. Court prosecutors would not comment on whether HADEP would face a similar fate as that of its predecessor. "It is now up to the court and the appeals court to decide what its fate will be," Yuksel said. 3504 !GCAT !GCRIM !GVIO A Kuwait interior ministry official said on Monday a hunger strike at the Gulf state's central prison has been "contained". "The strike has been contained and everything is back to normal," Lieutenant Colonel Adel al-Ibrahim, spokesman of the interior ministry said by telephone. The strike by about 600 prisoners, which began on Saturday, was triggered when a grill was erected at the jail's visiting area after the escape of an inmate and to crackdown on drugs smuggling by visiting relatives, deputies said. Asked if the demands of the strikers were met, Ibrahim said: "We provide all means of care to prisoners." The strikers were pressing for better living conditions and fewer restrictions at its visiting area, deputy Ali al-Baghli, spokesman of parliament's human rights committee, had said. "Officials are trying to meet the strikers' demands," Baghli said on Sunday, noting that prison officials were preparing enhanced monitoring measures that would allow for the removal of the metal grill within a month. In January jail inmates burned down a prison hospital in a pre-dawn riot before security forces quelled the disturbances. The riot was caused by anger among drug addicts in the prison over a narcotics crackdown. 3505 !GCAT !GPOL !GVOTE Riding the rails to Chicago, President Bill Clinton urged Americans on Sunday to reject Republican Bob Dole's proposed across-the-board tax cut, saying it sounds good but would "blow a hole" in the budget deficit and trigger economic chaos. On the first day of a four-day whistle-stop train tour through middle America that will take him to the Democratic National Convention in Chicago on Wednesday, Clinton urged Americans to "stay on the right track" and give him a second four-year term. His "21st Century Express" chugged through coal-rich Appalachian hills, past cornfields, cow pastures, dilapidated barns and mobile homes, and people waving flags. It travelled from Huntington, West Virginia, through Ashland, Kentucky, on the Ohio River and came to a stop for a sunset rally before several thousand people in Chillicothe, Ohio. The town was one of the first places he visited after taking office in January 1993. "Welcome Back, Bill," said a number of signs. In his speeches, Clinton took dead aim at Dole's campaign pledge to give Americans a 15 percent, across-the-board tax cut that the Republican nominee says will help middle-class voters. "We can't afford it," he said. Clinton said his own more modest tax-cut proposals are affordable and targeted toward education and first-time home buyers, and that Dole's would return America to the days of 1980s tax cuts under Republican President Ronald Reagan that led to skyrocketing annual budget deficits and a legacy of national debt. "You look at that train there," Clinton said in Ashland. "If you were on that train going to your destination, which is the 21st Century, the last thing in the wide world you want to do is to make a U-turn because you heard a pretty song somewhere along the way. That's a pretty song, that big ole tax cut." He said the tax cut would "blow a hole in the deficit" and trigger higher interest rates that would hit Americans with higher mortgage payments, credit card payments and bigger cuts in Medicare and Medicaid health insurance for the poor and elderly. In Chillicothe, as thousands of bugs fluttered in the television lights, Clinton said a tax cut of Dole's magnitude would be like someone going to the bank and borrowing money to "give yourselves a tax cut." In Ashland with Clinton was Kentucky's Democratic Gov. Paul Patton, who said his tobacco-rich state largely supported the president except for his imposition last week of strict rules on tobacco aimed at keeping young people from smoking. "Mr. President, many of us disagree with you on tobacco, but we love you," he said. Kentucky native Billy Ray Cyrus, a country music singer, sang the national anthem, performed his hit song "Achy Breaky Heart" with pro-Clinton verses substituted, and delivered his own political speech: "The steel mills, the coal mines, the train tracks -- this is America." Clinton was to enter parts of five states on his ride to Chicago. After Chillicothe he was to stop in Columbus, Ohio, for the night. Whistle-stop campaigning goes back more than a century in America, but in recent decades politicians have tried to emulate the legendary 1948 tour that Harry Truman rode to an improbable come-from-behind election. Clinton hopes the train tour will generate some excitement and momentum going into Chicago and help negate a rise in the polls by Dole on the strength of the Republican convention in San Diego. The president plans to make news with some policy initiatives almost every day -- anti-crime on Monday, education on Tuesday and the environment on Wednesday, to add to a string of major bill-signings last week that kept him in the public eye. The president and his immediate entourage were travelling in two vintage "office cars" at the tail end of the 13-car, three-engine train. Clinton's car is the Georgia 300, also named the General Polk. The luxury car frequently carried President Franklin Roosevelt to his summer vacation home in Warm Springs, Georgia. 3506 !E41 !E411 !ECAT !GCAT !GJOB Americans can expect better job prospects in the fourth quarter, particularly if they work in durable goods manufacturing and the wholesale and retail trades, according to a recent survey by Manpower Inc. Growth in hiring is "steady" and not in danger of becoming overheated, Mitchell Fromstein, Manpower's chief executive officer, said in a telephone interview. "We don't see heavy pressures for wage increases," he said, referring to the observations of Manpower staff and not to the quarterly survey, which did not examine wages. "Part of that comes from having inflation controlled." In a quarterly telephone survey, Manpower asked employers at more than 16,000 U.S. firms if they intended to add or reduce staff during the fourth quarter. One out of four firms said they planned to increase their workforce in the fourth quarter, the same percentage as last year. But only 9 percent said they would cut staff, compared with 10 percent in the 1995 period. That means a net hiring figure of 16 for the fourth quarter, down from 15 in the year-ago period. "There's a slowdown in downsizing that appears in between the lines here -- a steady drop in the number of companies saying they're going to reduce their workforce," Fromstein said. The best hiring forecasts were reported by the wholesale and retail trade sector, followed by durable goods manufacturing. This is significant, as it indicates strength in both capital goods and retail products, Fromstein noted. Thirty-six percent of wholesale and retail trades said they planned to add staff, compared with just 7 percent who said they would use fewer workers, the best holiday forecast in 13 years, the survey reported. Similarly, the durable goods sector reported a net hiring figure of 19, well above the overall figure of 16. Twenty-eight percent of companies said they would add staff, compared with 9 percent which planned to downsize. Sectors expected to fare less well are public administration, construction, and transportation and public utilities, although all three show growth. The public administration sector shows a net hiring figure of just three, as 15 percent of companies planned to add staff while 12 percent planned to make cuts. This may indicate a trend among government agencies to do most of their hiring in the summer, the report said. The construction and transportation and public utilities sectors also showed growth below the overall figure, with net hiring strengths of five and seven, respectively. Construction was the only sector to show a decline compared with the fourth quarter of 1995. In the Northeast, net hiring strength is "substantially" below levels seen in the fourth quarters of the previous four years, the survey stated. However, it noted that the figures follow the busiest overall spring-summer employment period since 1988. Also significant is the fact that the overall drop from the third to fourth quarters will be lower than was expected for this year -- a drop from a net hiring strength of 20 to 16. That gap represents the smallest seasonal decline in five years, Manpower reported. Slightly lower hiring activity is planned for the Northeast, compared with other areas. The Midwest, on a deseasonalized basis, shows the best forecast since 1976. The South continues to do well and the West continues an employment recovery that began in early 1994. Manpower operates 2,200 temporary help offices worldwide. 3507 !GCAT !GPOL !GVOTE Less than a minute into the maiden speech of his whistlestop train trip, President Bill Clinton made his first re-election campaign promise, vowing to bring every U.S. public school into the computer age. Speaking to a cheering crowd in Huntington, West Virginia, Clinton said that if he and Vice President Al Gore prevailed in the November 5 ballot, they will hook every classroom "up to the information superhighway, so that all of our children will have world-class education." Clinton, riding the rails to the Democratic Convention to demonstrate grassroots support for his presidency, will outline a second-term agenda that he calls "America Forward" in specific detail in a speech to the delegates in Chicago on Thursday night. Many of its elements, including a modest tax cut designed to promote education and create jobs for unskilled workers, are already known. Implementing the newly-enacted welfare reform bill, which will bring a radical overhaul of how poor people are treated in the United States, and incremental reform of the health care system are also part of the agenda. On the international front, Clinton has identified fighting terrorism as the number one U.S. foreign policy challenge. Preserving the fragile peace in Bosnia and trying to revitalise the Middle East peace process are also certain priorities if the 50-year-old Democrat holds onto the White House. Less certain is who will fill some of the most important posts in the in the executive branch if Clinton, who enters the Fall campaign leading Republican rival Bob Dole by five to 12 percent in the polls, is the first Democrat since Franklin Roosevelt to be re-elected. Clinton has forbidden his staff to talk about who will stay and who will go if his administration remains in power, arguing that it would be presumptuous -- and foolhardy -- to take the election for granted. But there is much speculation within official circles that Secretary of State Warren Christopher, whom Clinton himself describes as "worn out" from Mideast shuttle diplomacy, and Attorney General Janet Reno, who has Parkinson's Disease, will not stay on for a second term. And Transportation Secretary Federico Pena has reportedly told friends he wants to return to Denver, Colorado to spend more time with his family. U.N. Ambassador Madeleine Albright, perhaps the the most powerful U.S. woman diplomat ever; Deputy Secretary of State Strobe Talbott, a former Oxford classmate of the president and charter "Friend of Bill"; and former Assistant Secretary of State Richard Holbrooke, broker of the Bosnia peace accords, are all on the short list of possible successors for Christopher. White House insiders say Commerce Secretary Mickey Kantor is a likely replacement for Reno in a potential Clinton cabinet reshuffle, with former White House chief of staff Thomas "Mack" McLarty replacing Kantor. In an interview with the Washington Post published on Sunday, Clinton said he wants to go down in history as the only president besides Theodore Roosevelt to shape an era of major change "without a major war catalyzing it." But modern U.S. history teaches that presidents seldom fulfil their ambitions if they win a second term: scandal more often has roiled their second four years in office. Richard Nixon was driven from office by Watergate misdeeds two years after being re-elected by a landslide, and Ronald Reagan, who also won a landslide re-election victory, was bedevilled by the Iran-contra affair. The same lot could befall Clinton. For whether he wins or loses, independent counsel Kenneth Starr will continue his investigation of the web of questionable business, legal and ethical dealings collectively called Whitewater that have dogged Clinton and his wife, Hillary, since they left Arkansas. 3508 !GCAT !GPOL President Bill Clinton lashed out on Sunday at what he called an outrageous Republican abuse of power and smear campaign against his associates over the Whitewater affair, saying their lives had been "wrecked by pure, naked, raw politics." In an emotional attack on his Republican opponents, Clinton said not a shred of evidence of wrongdoing had been found against him or First Lady Hillary Rodham Clinton in the Whitewater tangle of financial dealings. Clinton vowed to help pay the legal bills of friends and associates forced to defend themselves from charges of financial misdeeds. "I think it is outrageous that these middle class people have had their lives wrecked by pure, naked raw politics," Clinton said in an interview with CNN television during a stop in Kentucky on his four-day campaigning train trip to the Democratic convention in Chicago. "I'm going to help pay their legal bills if it's the last thing I ever do, and I stay healthy," Clinton said. A number of associates of Clinton when he was governor of Arkansas and others who have worked with him since he became president have faced charges of impropriety linked to Whitewater. Clinton business partners James and Susan McDougal and former Arkansas governor Jim Guy Tucker were convicted in May of fraud and conspiracy charges. Susan Mcdougal was sentenced to two years in jail. Tucker resigned and was put on probation and fined. James McDougal will be sentenced in November. Two other Arkansas allies of the Clintons have been acquitted of violating banking laws to help Clinton's 1990 campaign for re-election as state governor, a case that touched several other Clinton friends, including close adviser Bruce Lindsey. "Do I feel terrible about the completely innocent middle class people who have been wrecked financially by this? I certainly do. I didn't abuse them and it's high time that the people who did, take responsibility for what they do," Clinton said. Without mentioning Whitewater special prosecutor Kenneth Starr by name, Clinton said there had been an abuse of the law allowing a special counsel to be appointed to investigate alleged wrongdoings in the executive branch. Starr, a Republican, has been investigating the Whitewater affair for about two years. Clinton also criticised the aggressive questioning of White House witnesses during the investigation by Senate Whitewater Committee Chairman Alfonse D'Amato. "And still they stand up and smear and smear," Clinton said of the Republicans. Starr has said he is continuing his investigation of the Clintons. The president says the investigation, initiated by the Republican-controlled Congress, is politically driven and that he and his wife are innocent. "There has still not been a single solitary shred of evidence of wrongdoing by me, by my wife, by her law firm, by my administration. And if you look at the evidence in the D'Amato committee of my record as governor, witness after witness after witness after witness said this man did not do wrong," Clinton said. 3509 !GCAT !GDIS !GWEA Hurricane Edouard and its 140 mph (225 kph) winds pushed across the Atlantic on Sunday, but National Hurricane Centre forecasters said it was still too far from land to predict where the dangerous storm might strike. At 11 p.m. EDT (0300 GMT), the centre of Edouard was located 650 miles west (1,045 km) of the Caribbean's Leeward Islands, or at latitude 17.3 north and longitude 51.5 west. "This is a dangerous hurricane," said forecaster Mike Hopkins. "But it's still premature to speculate about where, or if, it will make landfall by mid-week." Edouard, a compact and powerful storm, was swirling west-northwest at 15 mph (24 kph). Hurricane forecasters said computer models showed Edouard was likely to remain strong for at least the next three days, due to favourable conditions for hurricanes in the Atlantic. "On its current course, it could miss the Caribbean islands, but we just can't make any predictions yet," Hopkins said. The rapid organisation of the storm's eyewall and intensity of its winds made forecasters declare Edouard a Category 4 hurricane, a dangerous storm capable of massive destruction. Hurricane forecasters rank storms in five categories, according to wind speed. Four years ago on Aug. 24 another Category 4 storm, Hurricane Andrew, slammed into south Florida and caused more than $20 billion worth of damage and left one-quarter of a million people homeless. Meanwhile, tropical depression number six began falling apart off the west coast of Africa, and forecasters said it was unlikely to pose any danger. 3510 !C21 !C24 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Corn and soybean crops in the U.S. Midwest should have normal to above-normal temperatures through the weekend, but a hurricane in the south central Atlantic has forecasters cautious about longer-term forecasts. "There's definitely no frost threat the next 10 days," said Craig Solberg, meteorologist with Freese-Notis Weather. "Plus, maybe we can add some growing degree days." Northern Iowa and southern Minnesota received beneficial rain over the weekend, as did southern sections of Illinois, Indiana and Ohio with maximum amounts of one to 1-1/2 inches, forecasters said. The weekend rain that fell in northern Iowa and southern Minnesota was forecast to move east Monday, bringing rain to eastern Iowa, southern Wisconsin and northern Illinois, and by Wednesday most Midwest areas should be dry, said Fred Gesser, meteorologist with Weather Express Inc. High temperatures across the Midwest should range from the high 70s- to low 80s-degrees Fahrenheit this week, with lows in the low 50s Tuesday and low 60s by late week. The spring wheat areas of the Dakotas and central Minnesota should be mostly warm and dry, allowing for advances in the spring wheat harvest. Gesser said Hurricane Edouard, a powerful storm now in the south central Atlantic, made it difficult to formulate long-term forecasts. The hurricane was heading northeast toward Florida, but has ample time to change course to the north, he said. The path it takes could affect rainfall and temperature forecasts for the Midwest. However, it will be the end of this week before Edouard nears land. Gesser and Solberg said Edouard is a strong Category 3 hurricane on a scale of five, with five the most powerful. They said Edouard may be upgraded to a Category 4. --312-408-8720-- 3511 !GCAT !GDIS !GWEA Two storms, Typhoon Orson and Tropical Storm Piper, threaten shipping in the western Pacific Ocean, independent forecaster Weather Services Corp said on Monday. Typhoon Orson, a major threat to shipping, is expected to track northeastward from near 25n/150e to near 28n/152e during the next 48 hours, over open waters. Top winds, now near 130 mph, are expected to increase to near 150-155 mph this period. Tropical Storm Piper is weakening and in transition to an extratropical weather system. The storm is currently near 41.2n/159.0e and is likely to become extratropical within 12-24 hours. Piper will not be as dangerous to shipping as Orson but will continue to be a moderate risk at least for the next 24 hours, WSC said. 3512 !C21 !C24 !CCAT !GCAT !GWEA Temperatures will trend cooler in Brazil's coffee areas towards the end of this week but there is no damaging cold anticipated, independent forecaster Weather Services Corp said. The forecast for the next couple of days is for mostly dry and mild weather. There will be variable cloud with scattered showers and thunderstorms in the south, but partly cloudy conditions with a few showers in the north. Temperatures trend to more seasonal levels. Wednesday will see scattered showers and possible thunderstorms, then it will be drier and cooler on Thursday and Friday. East-central Brazil was mostly dry on Sunday, with highs of 78-90 F and lows of 50-66. 3513 !GCAT !GPOL !GVOTE President Bill Clinton widened his lead over Republican challenger Bob Dole on the eve of the Democratic Party convention, USA Today reported Monday. The USA Today/CNN/Gallup poll said Clinton's approval rating remained above 50 percent, the same as last week, and 69 percent of those polled said he would win the November presidential election. The survey said if the elections were held today, 50 percent of voters polled would vote for Clinton, 38 percent for Dole and 7 percent for billionaire third-party candidate Ross Perot. In an Aug 25 poll, Clinton had a lead of 48 to 41 percent over Dole, with Perot at 7 percent. Dole had been widely seen as getting a boost from his nomination at the Republican Party convention two weeks ago. The poll said 47 percent of voters wanted to see Democrats win control of Congress in elections against 44 percent of those who wanted to see Republican controlling Congress. Fifty-three percent of voters approved of the way Clinton was doing his job, up slightly from 52 percent last week. Thirty-nine percent disapproved, the same as a week ago. The poll came as Democrats prepared to open the party convention in Chicago on Monday. The telephone survey involved 1,003 adults polled nationwide from Friday to Sunday and had a margin of error of plus or minus 3 percentage points. 3514 !GCAT !GCRIM !GPOL President Bill Clinton tries to add steam to his political express on Monday by unveiling a plan to keep pistols out of the hands of people convicted of spousal or child abuse. Clinton, in the midst of a colourful, made-for-television train trip to the Chicago Democratic Convention, will propose expansion of the so-called Brady Law, which requires a five-day waiting period for handgun purchases in a speech at the Columbus Police Academy, aides said. The initiative will be coupled with a renewal of Clinton's oft-stated call for a ban on "cop-killer" bullets, which can penetrate bulletproof vests, and is meant to show he is tough on crime and sensitive to the concerns of women voters. Clinton, travelling by train with his daughter, Chelsea, 16, while his wife Hillary has a busy convention schedule in her old hometown, plans to grab headlines with a new proposal every day of his trip. Tuesday's will deal with education, Wednesday's with the environment. His focus on crime was designed to tie into the opening session of his party's convention, which features a speech by Sarah Brady, wife of former White House spokesman James Brady, who inspired the gun law. Brady is wheelchair-bound because of the gunshot wounds he suffered when john Hinckley, Jr. tried to kill then-President Ronald Reagan in front of the Washington Hilton Hotel in 1981. Clinton, campaigning through five states with 64 of the 270 electoral votes needed to win the presidency on his way to Chicago, is on the trip to try to energise grassroots support for his re-election bid. He boarded his "21st Century Express" for the four-day whistlestop in Huntington, W.Va., on Sunday and rolled through parts of Kentucky before reaching Ohio. His train will also roll through Michigan and Indiana. "I'm going on a train, because I want to see the people like you that I've been working for and fighting for, for four years," Clinton told cheering West Virginians as he set out on his journey. Meantime, Clinton's Republican rival Bob Dole brought his campaign to within shouting distance of the Democratic convention and blasted away at Clinton's record on curbing drug abuse, which has risen dramatically among young people during the last four years. In a convention-eve interview on Cable News Network, Clinton said Dole and Republican House of Representatives Speaker Newt Gingrich were" partly responsible" for the adverse trend for not supporting drug education, treatment and prevention programmes that he proposed. But Clinton said he doubted that trying to assign political blame for the problem "helps us very much." "Whatever we've done has not worked and we all need to face that," he said. "If anybody has a better idea, I'd be happy to look it it. We have got to do something to turn it (drug use by young people) around." 3515 !GCAT The United Auto Workers and Big Three auto makers are discussing adopting an extended national contract that would last longer than the traditional three-year agreeement, The Wall Street Journal reported on Monday. At the same time, the union and General Motors Corp have settled some contentious local issues at the national bargaining table, signalling efforts by both sides to avoid a confrontation this fall. The current contract between the union and the auto makers expires on Sept 14. The newspaper also reported: * Abercrombie & Fitch Co, a unit of Limited Inc, plans to sell about 14 percent of the company in an initial public offering. * Bomb-detection stocks rise on latest evidence from Trans World Airlines crash. * Analyst says she thinks HFS Inc is considering buying Alamo Rent A Car. * Venezuela's government anti-trust panel is investigating a recent deal between Coca-Cola Co and Venezuela's Grupo Cisneros. * The Federal Reserve is prepared to ease banking restrictions. * Durable goods orders rose a stronger-than-expected 1.6 percent in July. * Bass Plc to merge with Allied Domecq's Carlsberg-Tetley. * Lloyd's of London says 75 percent of members accept settlement terms. * President Bill Clinton gives the Food and Drug Administration oversight of tobacco industry and approves tough new rules. * The Federal Reserve came close to raising short-term interest rates in July. * A survey by Manpower Inc shows 25 percent of employers plan to expand their workforces in the fourth quarter. * Indiana jury decides tobacco companies were not liable for smoker's death. -- New York newsroom, (212) 859-1610 3516 !GCAT The Washington Post carried only local business stories on August 26, 1996. 3517 !GCAT The New York Times reported the following business stories on Monday: * Netscape Communications Corp is creating a software company that will enter an alliance with International Business Machines Corp, Oracle Corp, Sony Corp, Sega Enterprises Ltd, Nintendo Co Ltd and NEC Corp. The move opens a new front in Netscape's war with Microsoft Corp. * The amount of advertising is not necessarily an indication of a magazine's financial health. * Analysts expect cigarette stocks to rise after a jury ruled on Friday that the industry was not responsible for the cancer death of an Indianapolis man. * Executives at Lloyd's of London work through the weekend to overcome the latest obstacle in their effort to resolve their financial crisis. * Capital Cities/ABC Inc's ABC News used an electronic system to track from one second to the next responses of a group of uncommitted voters to speeches at the Republican National Convention. * The growth of the World Wide Web has put a new premium on graphics. * Outside companies complain they are sometimes being shut out of access to cable services owned by corporations that produce their own programming. * Tourism rebounds in California. * Organized labour is marking a resurgence in Democratic politics. * The advertising account for Coca-Cola Co's Minute Maid juice line has been shifted to Leo Burnett Co from Lowe & Partners/SMS, a unit of the Interpublic Group of Cos Inc. -- New York newsroom (212) 859-1610 3518 !GCAT !GCRIM The Brady Law, which imposes a five-day waiting period for buying handguns so background checks can be conducted, has kept guns away from more than 100,000 criminals and other banned purchasers, according to a study released Monday by the law's chief proponent. The study was released hours before President Clinton was to propose extending the law to bar handgun sales to anyone convicted of domestic violence against women. According to the survey by the Centre to Prevent Handgun Violence, the Brady law stopped 72,325 felons and more than 30,000 others from buying a handgun since it took effect February 28, 1994. The law is named for James Brady, the White House spokesman wounded in the March 1981 assassination attempt against former President Ronald Reagan. The Centre to Prevent Handgun Violence is chaired by Brady's wife, Sarah. Beside convicted felons, the law is aimed at preventing handgun purchases by people adjudicated mentally defective or subject to a restraining order. Clinton was to unveil his proposal, the latest in a series designed to protray him as tough on crime and to appeal to women voters, during a four-day whistlestop train tour through West Virginia, Kentucky, Ohio, Michigan and Indiana. The Dole-Kemp campaign issued a statement saying Bob Dole supported an initiative to prevent domestic abusers from buying any type of gun and criticised the administration's record on the issue. "Dealing with America's epidemic of domestic violence will take tough laws and tough prosecutors, not more empty rhetoric," said deputy press secretary Christina Martin. The president arrives in Chicago Wednesday for the Democratic convention, where he is to be named his party's nominee for re-election on November 5 in a race against Dole. 3519 !GCAT !GPOL The State Department's fifth-ranking official resigned last week after acknowledging a "consensual" relationship with a member of his immediate staff, the Washington Post reported in Monday's editions. Richard Moose, undersecretary for management, acted after the State Department inspector general looked into allegations in an anonymous letter that Moose had increased his overseas travel accompanied by a female aide with whom he was alleged to be having an affair, the paper said. The department announced Friday that Moose, a 40-year career foreign service officer who is married and a native of Little Rock, Ark., had resigned to head a study at the Council on Foreign Relations on the impact of declining U.S. foreign policy spending. Moose, 64, was in charge of all budgetary, administrative and personnel matters at the State Department. Neither he nor a department spokesman could be reached for comment. 3520 !GCAT The Washington Post carried the following stories on its front page on Aug 26: --- WASHINGTON - D.C. financial control board weighs firing school superintendent and appointing receiver to run city's schools. --- ASHLAND, Kentucky - Clinton started four-day chug to Chicago aboard customized train and railing against Republicans with some of sharpest and most partisan rhetoric he's uttered in this election season. --- JERUSALEM - Israeli President Ezer Weizman invited Yasser Arafat to pay him a visit. --- CHICAGO - Vice President Al Gore has elevated his office, wooing parts of Democratic Party base that had no use for him when he first sought the presidential nomination in 1988. --- WASHINGTON - More Americans are staying home rather than travelling while on vacation from their jobs. 3521 !GCAT !GPOL Most delegates to the Democratic Party convention fully back President Clinton even though they consider themselves more liberal than he is, a New York Times/CBS News poll showed Monday. The poll reported in The New York Times also showed the 4,320 delegates have a strong liberal faith in government's ability to improve American life, despite Clinton's efforts to move the party to the ideological centre. Fifty-nine percent of delegates to the convention, which begins Monday in Chicago, say they support Clinton without reservations. Thirty-six percent say they do so with only minor reservations. However, 26 percent of those polled say Clinton's main weakness is a tendency to compromise on issues. Another 30 percent cite his chief weakness as his character in general, or Whitewater and other admninistration scandals. The Democratic delegates consider themselves more extreme ideologically than their candidate. Forty-eight percent call themselves moderate, but 86 percent view Clinton that way. Forty-three percent call themselves liberals, but only 8 pecent call Clinton a liberal. Seventy-six percent said government should do more to solve the nation's problems, compared with 53 percent of Democratic voters generally and 36 percent of all voters. On almost all issues, the delegates present a reverse image of the generally conservative Republican Party delegates who nominated Bob Dole for president two weeks ago in San Diego. The survey was conducted between Aug. 8 and 22 with 509 randomly selected delegates, mainly by telephone. The overall margin of sampling error is plus or minus four percentage points. 3522 !C33 !C331 !CCAT !GCAT !GDEF !GDIP The United States has angered Thai officials by turning down their latest push for the early supply of advanced air-to-air missiles, U.S. and Thai officials said. Thailand has been pressing to buy the AIM-120 Advanced Medium Range Air-to-Air missile, the most advanced of its kind, to equip a squadron of F/A-18 "Hornet" fighters that it is buying from McDonnell Douglas. A Royal Thai Air Force delegation visited Washington this month with a fresh request for the Amraam, which has been withheld for fear of sparking a Southeast Asian arms race. In rejecting the new Thai request, U.S. authorities again cited a Clinton administration arms transfer policy that frowns on being the first to introduce new war-fighting technology into any region. In addition, they discounted as unpersuasive Bangkok's analysis of its perceived early need for the missile, a senior administration official said without disclosing the Thai reading of current and projected threats. "They're trying to paint us as an untrustworthy partner," the official told Reuters late last week, referring to Thai officials. "They're not taking it too well, but that's the song we're singing." A Thai embassy official confirmed that an eight-member Air Force delegation, which visited Aug. 5-7 to press Thailand's case, had gone home "not very happy" over the United States refusal to budge on the Amraam. The F-18 sale, valued at $578 million, was held up by initial Thai insistence that Amraam missiles be included as part of a package deal. As an alternative, Thailand had weighed buying competing French- or Russian-built fighters equipped with Amraam-like active-radar-guided missiles. Ultimately, the United States finessed the issue by promising it was only a matter of time before Bangkok would get the Amraam, used against Iraq with great effect by U.S. pilots during the 1991 Gulf War. "The sale would be concluded upon mutual assessment that a comparable missile has been delivered into the region," Assistant Secretary of State Thomas McNamara said in a December 21 letter to the head of the Thai Air Force. The eventual Amraam sale now seems likely to hinge on when Malaysia gets Russian-built AA-12 "Adder" air-to-air missiles, a similar fire-and-forget weapon, U.S. officials said. U.S. experts said Malaysia may have already struck a deal for the "Adder" to arm 18 MiG-29 "Fulcrum" fighters that Russia completed delivering to it last year, but that the Adder delivery could take as long as several years. One U.S. expert said another reason for U.S. reluctance to release the Amraam to Thailand may be fear that its technology would leak to China. "Obviously we wouldn't want it used against Taiwan in the Taiwan Straits," William Triplett, the former chief Republican counsel to the Senate Foreign Relations Commitee and an expert on the Chinese military, said in an interview on Sunday. 3523 !GCAT !GPOL !GVOTE By Alan Elsner, Political Correspondent Democrats kick off their 1996 convention on Monday, eager to exorcise the ghosts of their notorious 1968 gathering in Chicago and to launch President Bill Clinton on the way to a second term in the White House. With Clinton leading Republican challenger Bob Dole in two new weekend polls by five and 12 percentage points, one of the biggest Democratic problems will be to create enough news to persuade voters to pay attention. The president did his part by embarking on Sunday on a four-day Harry Truman-style whistle-stop train tour through the American heartland, stopping each day to unveil a new policy initiative. Day one found the president chugging through coal-rich Appalachian hills in West Virginia and Kentucky, past cornfields, cow pastures, dilapidated barns and mobile homes, and people waving flags. At a sunset rally before several thousand people in Chillicothe, Ohio, Clinton drove home his theme of the day -- that Dole's proposed 15 percent income tax cut was irresponsible and would drive the country towards bankruptcy. Clinton was in a feisty mood, which continued in a CNN interview on Sunday evening in which he angrily blasted Republicans for hounding many of his staff and associates over the Whitewater affair. "I think it is outrageous that these middle class people have had their lives wrecked by pure, naked raw politics," Clinton said angrily. Dole meanwhile dropped by a Chicago suburb to lambast the Clinton administration's record in the war on drugs, before heading for a brief vacation in Santa Barbara, California, leaving the spotlight to the Democrats for the next four days. The Democrats have a hard act to follow after Republicans produced a slick, well-orchestrated display of unity and harmony at their San Diego convention nearly two weeks ago. With some of their most riveting orators of the past, like former New York Governor Mario Cuomo and former Texas Governor Ann Richards, now on the sidelines after voters threw them out of office in 1994, Democrats will be showcasing lesser-known names as well as personalities drawn from outside politics. The main draw on the first night of the convention, which begins at 5 P.M. EDT (2100 GMT), will be movie star Christopher Reeve, paralysed from the neck down after being thrown from a horse. Also speaking was Sarah Brady, wife of former President Ronald Reagan's press secretary, who became a gun control activist after her husband James was partially paralysed in a 1981 assassination attempt on Reagan. The Republican convention drew the lowest television audience on record for such an event but still achieved its desired effect of giving Dole a substantial boost in the polls. Despite his lead, two new surveys showed Clinton could use a similar convention "bounce". An ABC poll of likely voters showed Clinton leading Dole 47 to 42 percent, with Texas billionaire Ross Perot trailing on seven percent. A CNN poll of registered voters gave Clinton 50 percent to Dole's 38. There is a sense in Chicago of events coming full circle with this convention. In 1968, with the Vietnam War raging, brutal police wielding billyclubs and spraying teargas attacked thousands of youthful anti-war protesters. Now, the postwar "baby boomers" who protested then have become the establishment, long hair has given way to baldness, marijuana to heartburn medicine and the police have undergone sensitivity training courses. Mayor Richard Daley, whose father ordered the 1968 crackdown, appeared at a kiss-and-make-up rock concert with former protest leaders where the cast of the musical "Hair" kept their clothes buttoned up during a rendition of "This is the Dawning of the Age of Aquarius". Clinton, the first of his generation to become president, was not in Chicago in 1968, though he did organise and participate in anti-war demonstrations. 3524 !GCAT The New York Times reported the following stories on its front page on Monday: * President Bill Clinton denounces Republicans on way to Democratic Party convention. * Poll shows Democratic delegates solidly support Clinton. * Republican presidential candidate Bob Dole vows greater use of military to fight drug trafficking. * New York city immigrants are worried about new welfare law. * Police crackdown on New York drug trafficking leads to fall in general crime. * Russian national security adviser Alexander Lebed suspends Chechen peace talks. * Chinese cuisine raises debate on cruelty and culture in San Francisco. * Tiger Woods becomes first golfer to win three consecutive U.S. Amateur titles. -- New York newsroom, (212) 859-1610 3525 !GCAT !GDIP President Bill Clinton said on Sunday President Boris Yeltsin was in control in the Kremlin although he obviously had health problems. "He is clearly in charge," Clinton said in an interview with CNN television during a four-day whistle-stop train journey to the Democratic Party convention in Chicago. Yeltsin's health has been of concern in the West since he disappeared from view before the July Russian presidential election. He been seen in public only a few times since, on each occasion looking slow and hesitant in his movements. Last week, confusion over policy on the war in Chechnya raised questions about who was in charge in the Kremlin. "We all know that he was exhausted after the (presidential) campaign, that he's had some health problems. But I want to assure everybody that's what they are -- health problems," Clinton said. "What we all want for President Yeltsin is to get the rest he needs, get the medical treatment he needs...", Clinton said. But he added: "There's no question he's making the big decisions." Asked whether he believed Yeltsin should come to the United States or another country outside Russia for treatment, Clinton said: "I think that's entirely up to him and his doctors. They can make that decision." 3526 !GCAT !GDEF !GDIP U.S. intelligence officials have concluded that Pakistan was secretly building a factory to make a medium-range missile using blueprints and equipment supplied by China, the Washington Post reported on Sunday. U.S. government officials would not confirm the report, which quoted an intelligence report as concluding Pakistan may have developed nuclear warheads to be placed atop the M-11 missiles. Pakistan was not a declared nuclear power but U.S. experts believe it capable of producing nuclear weapons quickly. The existence of such a missile plant would add a new dimension to collaboration between the two states, including the military and nuclear fields. This has troubled Washington and was a factor in a souring of Sino-U.S. relations last year. A White House spokesman said he could not confirm the story but said the United States took such reports seriously. "We do not believe it is in the best interests of the United States or of any other country to supply Pakistan with the capacity to manufacture or deploy weapons of mass destruction," the spokesman said. The Washington Post said the partially completed factory in a suburb of the northern city of Rawalpindi was expected to be capable of producing most of the major components of a missile modelled on the Chinese-designed M-11 in a year or two. The same newspaper reported in June that U.S. intelligence agenices had "unanimously concluded" that Pakistan had already obtained complete M-11 missiles from China, but both China and Pakistan denied that report. The United States has twice imposed limited economic sanctions against China for selling M-11 missile launchers and missile components to Pakistan, but withdrew them after China promised to stop such deliveries. Washington recently settled another dispute with China over a sale to Pakistan of nuclear-related equipment. U.S. Vice President Al Gore said the United States had an "active, vigorous programme of monitoring all exchanges of technology from China or any other country that might violate" international agreements or treaties. "We expect that they will comply with the provisions of the laws and treaties involved," Gore said in an interview on ABC's "This Week with David Brinkley" programme. The Post quoted officials as saying the construction of the missile factory raised the possibility that broad economic sanctions eventually could be imposed on both countries. However, the White House spokesman suggested sanctions were not immediately in the offing. "We have not come to any conclusions that would warrant sanctions at this time with respect to Pakistan or China," he said. The Washington Post said the existence of the Pakistani factory had been known to U.S. intelligence officials since last year when construction evidently began. The White House has sought better relations with China after months of disputes over Taiwan, trade and human rights. Gore said a visit to Beijing by U.S. National Security Adviser Tony Lake last month resulted in a "much more productive and open" dialogue. Pakistan has depended increasingly on Chinese help to meet its defence needs because of virtual rupture in military ties with the United States since 1990 due to suspicions about Pakistan's nuclear programme. The sanctions were eased this year when the U.S. Congress approved delivery of some blocked equipment that was already paid for. 3527 !E12 !E21 !E211 !ECAT !GCAT !GPOL !GVOTE President Bill Clinton attacked Republican challenger Bob Dole's economic plan on Sunday, saying it would damage the budget, push up interest rates and hurt the economy. "It's bad for the economy," he told CNN television in an interview. "If their plan prevails over mine, their interest rates will be two percent higher," he said. Clinton cited a Republican study earlier this year that warned that failure to balance the budget would push up long-term interest rates by two percentage points. Dole has promised to both slash taxes by $548 billion over six years and balance the budget -- a pledge that Clinton and his Democratic Party allies have derided as unrealistic. "Wall Street doesn't believe in this plan," the president said. "This big tax cut ... will cause a big increase in the deficit and also cause bigger cuts in education, the environment and medical programmes than we can afford." Clinton was asked what his top two or three priorities would be if re-elected president on Novemebr 5. "We've got our economic house in order today and we're facing our social problems," he said. "What we don't have is a country where every person can take advantage of this new global economy. "My first priority is education," he continued. "My second priority is devising ways to move people from welfare to work ... and creating incentives to focus on the inner cities and the isolated rural areas which have been left behind." 3528 !GCAT !GPOL !GPRO - Chelsea Clinton, until now carefully shielded from the exposure of public life, made her political debut on Sunday on her father's whistlestop train trip. Chelsea, 16, was at President Bill Clinton's side as he rode the rails through parts of West Virginia, Kentucky and Ohio, and was introduced at every stop. She even worked ropelines, shaking hands with excited fans. Hillary Rodham Clinton saw her husband and daughter off on the trip in Huntington, West Virginia and then went on to Chicago to begin a rigorous Democratic Convention schedule. Asked if Chelsea would have a prominent role in the campaign, White House spokesman Mike McCurry said: "She'll do what she did today when she can. She has to go back to school." The president's daughter is going into her senior year of high school at Sidwell Friends School, a private school in Washington. McCurry said Chelsea has asked to go on the train trip and attend the convention where her father will be renominated, but said her exposure did not signal the start of a new political career. Chelsea "is a very poised young lady, but she's not that much interested in politics," the spokesman said. 3529 !GCAT !GCRIM Belgian investigators said on Monday they had made a 10th arrest in connection with their inquiries into a rapidly widening child sex scandal which has rocked Belgium and drawn headlines across the world. A court official in the southern Belgian village of Neufchateau said Pierre Rochow, son of a scrap metal dealer, had been arrested on Sunday on charges of taking part in a criminal association concerning theft and receiving stolen goods. His arrest follows three others on Sunday in connection with a car and truck theft ring, including that of senior police detective Georges Zicot. The central figure in the sex scandal, Marc Dutroux, has been linked with several people arrested for organised vehicle theft and police are now investigating both rings jointly. Dutroux, a convicted multiple child rapist, spent nearly four months in prison after being charged with car theft and related crimes last December. His arrest then came after he had locked up Rochow and two others following an argument over the theft of a truck. Dutroux has since been charged, with an associate, with abduction and illegal imprisonment of children. Belgian media said searches at his house in the village of Sars-La-Buisierre resumed on Monday. They said Superintendent John Bennett, the British police officer who oversaw excavations in Britain's "House of Horrors" murder case, led the searches which involved the use of sophisticated radar imaging equipment. Following Zicot's arrest, speculation has spread that a paedophile gang involved in killing and kidnapping children had received high level protection to avoid detection. His arrest added weight to questions over how the gang, thought to have been led by Dutroux, avoided detection for so long. "More indications of high level protection for Dutroux," said the leading Dutch-language newspaper De Standaard. It said an unlikely series of judicial blunders, plus documents and testimonies pointed directly to political and/or judicial cover. Justice Minister Stefaan De Clerck admitted last week mistakes were made and ordered an inquiry. Newspapers feared the prosecutor in charge of the scandal, Michel Bourlet, might be hampered in his efforts to solve the scandal. He made a comment on television last Friday implying his investigation could be stopped short. But De Clerck told a news conference on Monday no political or judicial pressure had been put on Bourlet in this case. "The investigation will continue with all possible means and nothing will be put in the way," De Clerck said. Two kidnapped eight-year-old girls have been found dead, two other girls have been rescued and police are hunting at least two more girls who have been missing for a year. Police have seized more than 300 video tapes -- some featuring Dutroux -- magazines, childrens' clothing and drugs allegedly used to pacify young victims. Dutroux's second wife Michelle Martin has been charged as an accomplice and three men face charges of criminal association. Zicot's connection was through one of Dutroux's accomplices, Bernard Weinstein, the prosecutor said. Dutroux admitted killing Weinstein after a disagreement over truck theft. His body was found with those of Julie Lejeune and Melissa Russo, both 8, in a house belonging to Dutroux, who said they starved to death nine months after being abducted in June 1995. Two other girls were rescued from a dungeon in another of Dutroux's six houses and police are hunting for at least two more whom Dutroux admitted kidnapping a year ago. 3530 !GCAT !GCRIM !GPOL !GVIO A Paris court on Monday struck down expulsion orders against three of 10 African immigrants who staged a 52-day hunger strike for the right to stay in France, lawyers said. Riot police ringed the administrative court as it considered appeals against expulsion orders for about 80 of 210 protesting immigrants forcibly ejected from a Paris church last week. Lawyer Anne Bremaud said the court ruled that they could not be deported in view of their health. Police had said only one of the 10 would qualify for a residence permit, but the government has said it would not expel anyone seriously ill. The 10 hunger strikers, most of them from Mali, called off their fast on Sunday after police released them. "They have started taking mashed food as they are unable to eat any solid food. They are very tired," said their spokesman, Doro Traore. An IPSOS opinion poll published by the daily Le Monde showed voters split on the government's policy to firmly enforce the hardline immigration laws while carrying out a case-by-case review of the protesters' situation on humanitarian grounds. Forty-six percent approved and 46 percent rejected it. The protesters were resting after moving their headquarters to a disused ammunition factory in the eastern Vincennes suburb. Some were enjoying the sunshine in the Vincennes park after weeks holed up in the Saint-Bernard church. Lawyers managed to get most protesters released at the weekend in a legal battle to keep them in the country, prompting some media to accuse the government of confusion. "The Great Muddle," the left-wing daily Liberation said in a headline of the confusion about the legality of expulsion orders. Police stood guard outside the court after riots broke out among sympathisers on Sunday night when the court announced that it had rejected 12 of 20 appeals against expulsion. Traore said all but 15 of the protesters were free and in the care of human rights groups. Four were deported to Senegal, Mali and Zaire on a French air force plane at the weekend. Three others were jailed for to two to three months, and a few were still held. Interior Minister Jean-Louis Debre has said 30 to 40 percent of the protesters would be allowed to stay in France. His adviser on immigration, Jean-Claude Barreau, told Liberation the percentage could reach two thirds. President Jacques Chirac has pledged to stick to the strict 1993 laws, despite a furore from left-wing parties and human right groups, in order to send a "strong signal" to discourage potential immigrants from poor countries. He promised to review details of the enforcemnt of the laws, which the protesters say outlawed immigrants previously living legally in France, and promote aid to poor nations. With an eye on the anti-immigrant electorate of the far-right National Front, he said French people, regardless of their politics, felt "a growing irritation over immigration". The IPSOS poll said 46 percent of voters sympathised with the protesting immigrants, to 36 percent who were hostile. It showed the electorate divided on the 1993 "Pasqua" laws pushed through by then interior minister Charles Pasqua. One third said they should be hardened while 20 percent favoured a softening, 35 percent wanted them unchanged, and four percent repealed altogether. Eight percent had no opinion. 3531 !GCAT !GCRIM !GPOL !GVIO A Berlin court suspended proceedings on Monday against a former member of East Germany's ruling Politburo on health grounds, dealing a new blow to attempts to bring to justice the architects of communist rule. Erich Mueckenberger, 86, is accused along with the others of being responsible for East Berlin's policy of shooting to kill refugees as they tried to flee to West Germany across the fortified frontier, and faces charges of manslaughter. The fragile health of the former head of the communist party's parliamentary group meant he was able to spend only short periods in court, slowing the trial of his co-defendants. These include the last hardline communist leader, Egon Krenz. Former party ideology chief Kurt Hager, 84, had already been released from the proceedings in May because of poor health. But Mueckenberger's removal may speed up a trial which has heard just two witnesses since it began last November. Out of 66 model cases of manslaughter and attempted manslaughter on which prosecutors chose to bring charges, 51 concerned only Mueckenberger, who was one of the longest-serving Politburo members along with Hager. With just 15 cases left, there was a better chance that prosecutors could secure at least some convictions soon against the political elite who have so far eluded all attempts to make them accountable for East Germany's decades-long state tyranny. Three second-tier officials, former defence minister Heinz Kessler, his deputy Fritz Streletz and regional party boss Hans Albrecht, were sentenced to between 4-1/2 and 7-1/2 years in jail but are free pending an appeal to the constitutional court. But the late former East German leader Erich Honecker and secret police chief Erich Mielke were both deemed too ill to stand trial over the border killings. Mielke was, however, convicted for killing two policemen in street battles in 1931, and released last year. In January a court convicted Wolfgang Vogel, the East Berlin lawyer who gained fame by engineering Cold War spy swaps, of extorting property from East Germans trying to get permission to emigrate to the West. 3532 !GCAT !GCRIM Speculation that a paedophile gang involved in killing and kidnapping children received high level protection to avoid detection spread through Belgium on Monday following the arrest of a senior police detective. The arrest on Sunday added weight to speculation about how the gang, thought to have been led by convicted rapist Marc Dutroux, avoided police detection for so long. "More indications of high level protection for Dutroux," said the leading Dutch-language newspaper De Standaard. It said an unlikely series of judicial blunders, plus documents and testimonies pointed directly to political and/or judicial cover. Justice Minister Stefaan De Clerck admitted last week that mistakes were made and ordered an inquiry. He did not confirm or deny the suggestions that Dutroux might have received protection, saying only that he had no such information. De Clerck will hold a news conference at 1400 GMT. Newspapers feared the public prosecutor in charge of the case, Michel Bourlet, might be hampered in his efforts to solve the scandal. Het Nieuwsblad said in a front-page open letter it was worried by a comment made by Bourlet on television last Friday implying his investigation could be stopped short. Bourlet said all the people identified on seized video tapes would be prosecuted, provided he was allowed to do so. Two kidnapped eight-year-old girls have been found dead, two other girls have been rescued and police are hunting at least two more girls who have been missing for a year. Police have seized more than 300 paedophile video tapes -- some featuring Dutroux -- magazines, childrens' clothing and drugs used to pacify the young victims. Dutroux, convicted in 1989 for multiple child rape, and associate Michel Lelievre have been charged with abduction and illegal imprisonment. Michelle Martin, Dutroux's second wife, has been charged as an accomplice and three men are facing charges of criminal association. But the arrest on Sunday of Chief Detective Georges Zicot, a specialist in tackling vehicle theft in the southern city of Charleroi, added a new dimension to the scandal. Zicot will be charged with truck theft, insurance fraud and document forgery. Gerard Pignon, owner of a warehouse where the alleged stolen vehicles were stored, and insurer Thierry Dehaan were also arrested. Zicot's connection was through Bernard Weinstein, one of Dutroux's accomplices, the public prosecutor said. Dutroux has admitted killing Weinstein after a disagreement over truck theft, he said. Weinstein was found dead with the bodies of eight-year-olds Julie Lejeune and Melissa Russo in a house near Charleroi belonging to Dutroux, who said they starved to death nine months after being abducted in June 1995. Two girls, Laetitia Delhez and Sabine Dardenne, were rescued from a dungeon in another of Dutroux's six houses 10 days ago and police are hunting for at least two more, An Marchal and Eefje Lambrecks, whom Dutroux admitted kidnapping a year ago. Recriminations have steadily built up over how Dutroux managed to remain at liberty for so long -- with allegations of protection in high places. Leaked police documents catalogue a high degree of police bungling, incompetence and indifference. Police in Amsterdam said they had released a 74-year old man held in connection with the Belgian investigation. "We couldn't find any link between him and the Belgian case so he was released," spokesman Klaas Wilting told Reuters. 3533 !GCAT !GDIP Israeli, Egyptian and U.S. officials will meet in Paris on Monday evening to discuss the Middle East peace process and a forthcoming economic conference, an Israeli embassy spokeswoman said. Diplomatic sources said U.S. envoy Dennis Ross would meet Danny Gold, an adviser to Israeli Prime Minister Benjamin Netanyahu, and Osama el-Baz, one of Egyptian President Hosni Mubarak's advisers. The spokeswoman said the talks would cover reviving the peace process and preparing for the Middle East economic conference planned in Cairo next November to promote economic integration in the region. She would not say where the talks would take place but said the United States was organising the meeting. No comment was immediately availanble from the U.S. embassy. French Foreign Ministry spokesman Jacques Rummelhardt confirmed the meeting was planned in Paris but said he did not know the exact time. He said Ross was meeting the French ministry's Secretary-General Denis Bauchard to review the Middle East peace process and tighten coordination between the two countries. "As the peace process goes through a delicate period, it seems important that the Americans and the French, who are very active in the Middle East, may be able to exchange views regularly to help the quest for peace," he told reporters. Egyptian President Hosni Mubarak showed signs of reluctance about the Cairo conference last week, saying many Middle East states would not attend unless Israel ensured that the faltering peace process moved forward. Netanyahu, apparently shaken by Mubarak's suggestion that he might cancel the summit, phoned the Egyptian president last week to tell him that peace talks with the Palestine Liberation Organisation would resume soon. Netanyahu, elected in May, is opposed to exchanging occupied Arab land for peace, the bedrock of the peace policy of the Labour government he replaced. 3534 !C17 !C34 !CCAT !G15 !G157 !GCAT Battle lines hardened on Monday in the dispute betweeen Germany and the European Union over subsidies by the state of Saxony for auto maker Volkswagen AG. Germany and the EU each threatened to file fresh complaints in the case with the European Court of Justice in Luxembourg, after Saxony did so on Friday. The tussle began in June when the European Commission approved only 540 million marks ($365.5 million) of a proposed 780 million marks in subsidies for VW to build two plants in the formerly communist east German state. Saxony premier Kurt Biedenkopf decided to hand over all the money anyway, because he said 23,000 jobs depended on it. German economics minister Guenter Rexrodt said Bonn backed Volkswagen's claim to all the cash, despite Brussels' contention this could start a spiralling war of subsidies. "I believe VW has a right to this money, and that the two plants must be built in Mosel and Chemnitz," Rexrodt told German television. Initially, Rexrodt was less than pleased at Biedenkopf's action and had urged him to reach a compromise with Brussels, but he now appears to be digging in for a standoff. Compromise "will be difficult, but nothing should be left untried. We need Brussels, Brussels needs us," he said. Rexrodt said he would recommend to the cabinet on Tuesday that Germany file a complaint in Luxembourg to clarify what role Brussels should play in monitoring Bonn's support for the rebuilding of the east, which still depends on massive help six years after unification. In Brussels, a spokesman told reporters the Commission planned no immediate action but would discuss the VW row at its September 4 weekly meeting, and would prepare to launch its own action in Luxembourg if the matter was not fixed to its liking. "If legality is not re-established we are preparing everything so that if necessary the complaint on our side will be launched," he said. Rexrodt and EU Competition Commissioner Karel Van Miert failed to resolve differences in a meeting last Friday, the day Saxony filed its complaint. Biedenkopf on Monday defended the decision to go to court. "Putting a European Commission decision to the test in court is not the same as putting Europe in question," Biedenkopf told a gathering of VW managers. He said the Commission was not a government but a bureaucratic body. The relationship between Saxony and VW was one of cooperation, not blackmail as Van Miert suggested last week, he said, adding that Saxony was convinced the subsidies for VW were legal. Saxony was one of the most industrialised regions in Germany before World War Two, and suffered greatly under the communist east German government. Unemployment there is now over 15 percent. 3535 !C13 !C34 !CCAT !G15 !G152 !GCAT The European Commission has rejected European Parliament amendments to the draft directive on postal services that would delay efforts to open the sector to more competition. The Commission said in its amended proposal, COM(96)412, that the language agreed by MEPs would "seriously undermine the delicate balance" between liberalising the market and protecting "universal service" that had been advocated by the Council of Ministers. Its decision means the Council of Ministers would have to act unanimously to approve the parliament's amendments -- an unlikely prospect given the enthusiasm of some member states for speedy liberalisation of postal services. The Commission, in a document dated July 31, said it rejected four parliament amendments (16, 19, 34 and 40) that would effectively freeze any liberalisation of direct mail or cross-border mail for at least five years after the directive took effect. The Commission's original proposal, COM(95)227, said that state post offices should be allowed to keep their monopolies only over domestic mail weighing less than 350 grammes and with tariffs less than five times the public tariff for a standard letter. But it said both direct mail and disbribution of incoming cross-border mail could be "reserved" for post offices until December 31, 2000. The Commission would decide by June 30, 1998 whether the services should be liberalised on that date. The parliament voted in May to propose a more cautious approach, expressing concern about job losses and deterioration of universal service -- the provision of affordable postal services to all citizens no matter how remote the region. The Commission said it also rejected amendments 20, 28, 40 (third part) and 54 because they would postpone a review of the directive's application from the first half of the year 2000 until five years after the legislation took force. It furthermore vetoed language -- the first part of amendment 41 -- that would restrict competition to provide registered mail services outside of the price and weight limits set for the "reserved" area. The strategy for removing postal monopolies over direct mail (junk mail) and incoming cross-border mail is the most controversial part of the draft postal services directive. With member states divided over how quickly to open up competition in those sectors, Italy proposed a compromise during its presidency that would set January 1, 2001 as the firm date for opening up direct mail, but leave the fate of incoming mail up in the air. The Telecommunications Council postponed a debate on the question when it met in June, although both the Belgian and French ministers grabbed the opportunity to say they opposed moving so quickly. The draft directive was proposed under Article 100 A of the EC treaty, meaning it must be adopted under the co-decision procedure with the European Parliament. If the parliament sticks to its guns throughout the process, it could ultimately veto a directive that is not to its liking. The Commission said it could accept a rash of other minor amendments agreed by the parliament, including one calling for a study on the possibility of issuing postage stamps in the Euro single currency. 3536 !GCAT !GCRIM On the eve of a major conference on child sex abuse, a Finnish Internet specialist on Monday angrily dismissed allegations in a British newspaper that his system handled up to 90 percent of child pornography on the Net. Johan Helsingius, whose Internet remailer or anonymous forwarding system is one of the largest in the world, said the claim in Britain's Observer Sunday newspaper was "totally false" and he was considering legal action. The newspaper reported the charges, by a U.S. policeman and FBI adviser, in the run-up to an international conference in Stockholm on the commercial sexual exploitation of children starting on Tuesday. Finnish police also said they had found no evidence in areas they can investigate that Helsingius's system is now being used to forward child pornography on a large scale. "We are working very closely with the authorities and the child protection agencies -- I am always encouraging people to report any incidence of child pornography they see on the Internet to police, so that they can investigate and act," Helsingius told Reuters by telephone. The Observer quoted Toby Tyler, a Federal Bureau of Investigation adviser on child abuse and pornography, as saying 75-90 percent of the child pornography he saw on the Internet was forwarded through Helsingius' system. Internet remailers are computers which receive and forward messages with a pseudonym or anonymous source. There are about five in the world, and they exist to enable anonymous discussion of sensitive subjects -- for instance by victims of child abuse, potential suicides or people in politically repressed societies. Helsingius said one key reason his system would not be used for pornorgaphy was that it has built-in capacity limitations which make it impossible to send large pictures through it -- only small amounts of text. "Also the groups where pictures are carried...are not supported in my server," he said. It could be possible to compress and chop up picture material for use through the server but this would involve using "tens or hundreds of separate messages", he said. Kai Malmberg, a Helsinki police specialist in Internet affairs, said he had in the past found child pornography remailed through the server but it had stopped since police started investigating. "I've found really no evidence of the Finnish remailer being used for child pornography," he said. "But we can't -- we don't want to -- check people's mail. That would be like going into the post office and opening all the letters. "I believe that he's quite sincere in trying to protect his server for people to discuss sensitive issues," he said. Asked if his system could be used to carry child pornography through individual e-mail messages, Helsingius said this was possible but not on a large scale as it does not support e-mail systems which simultaneously send to many recipients. But he said it was possible for Internet experts to imitate his remailer address to make it seem as if messages were coming through his system. "In a prevous case roughly a year ago we could find a couple of cases of child porn," he said. "It was actually posted in the UK to the UK -- it didn't come to Finland at all but it was being made to look like it came from my server. Anyone can alter the origination information." He said all the allegations about his remailer seemed to stem from Tyler, yet he had been unable to contact him. Tyler was travelling to the Stockholm conference on Monday and unavailable for comment. "The fact that he's claiming 90 percent of the child porn goes through my remailer is pretty far from the truth. There might be the occasional instance and we are actively working against that," Helsingius said. "My reputation has been tarnished all over Europe. We will take legal action, but we are not quite sure in what country." 3537 !GCAT !GPOL !GVIO Africans freed after a police raid on a Paris church set up camp in the city's eastern suburbs on Monday where they relaxed and traded tales about their detention, with one man saying armed police mysteriously released him in a wood. Ten hunger strikers among the Africans, who broke off a 52-day fast on Sunday, were drinking soup and pureed food under medical supervision at the Vincennes Cartoucherie, a former ammunition depot converted into an avant-garde theatre complex. "We're here to recuperate and reflect on our struggle," said Doro Traore, a Mauritanian who acts as spokesman for the Africans, most of whom are from Mali, Senegal and Zaire. "The hunger strikers are still very weak." Some of the Africans lazed on the grass in the sun, chatted, played the guitar or listened to radio bulletins about their lawyers' appeals against expulsion orders in Paris courts. Children played with coloured balloons, apparently happy to have traded the gloomy church or a detention centre for the open spaces around the theatres in the Vincennes woods. Police arrested 210 Africans, who had been protesting against expulsion orders by occupying the Saint-Bernard church, in a controversial raid on Friday that outraged human rights groups and left-wing opposition parties. The government had ordered the raid after a 50-day standoff between the Africans and Prime Minister Alain Juppe, who insisted on deporting those unlawfully in France to dissuade future illegal immigration. In a setback to the government, almost all were freed at the weekend, some after successful court appeals, but most still face the threat of expulsion. Four were deported on Saturday. "This is like a new Saint-Bernard," said Sahanounou Magassa, a 36-year old Malian man holding his seven-month-old daughter Mariam, whom he said had been made ill by police teargas. He said he was among those hit by tough 1993 reforms that outlawed some foreigners previously living legally in France. Traore said police told him and another African detained at Saint-Bernard on Saturday that they were being freed. They were then driven by police to a wood near Ferolles-Atilly, about 40 km (25 miles) southeast of the capital, and released. "They told us to get out. I said, 'So this is French democracy'. They were armed and we feared they wanted to kill us so we got out," he said. The two hitched home. Police declined comment. Organisers scrambled to find places for all to sleep at the Cartoucherie and many complained that police had thrown away mattresses and possessions seized in the raid on the church. From Monday night, all those who wanted would sleep at the Cartoucherie. On Sunday, families had spent the night split up among charities and human rights groups in Paris. Ariane Mnouchkine, director of the Theatre du Soleil at the Cartoucherie, said there was no question of the Africans transferring their protest to Vincennes from the church. "This is a shelter. Nothing more," she said. One Malian who gave his name as Djime said he had slipped away just before Friday's raid and had been in hiding since. "I came to France in 1988 on a tourist visa. Since then I've been working in restaurants and shops. I've paid social security contributions. I should be allowed to stay," he said. 3538 !GCAT !GCRIM !GDIP !GVIO Former Iranian president Abolhassan Banisadr will return to the witness stand next month in the trial of five men accused of the 1992 slaying of Iranian opposition leaders in Berlin, justice officials said on Monday. The Paris-based former Iranian leader gave evidence at the trial for two days last week, alleging that Iran's spiritual leader Ayatollah Ali Khamenei and President Akbar Hashemi Rafsanjani personally approved the assassination plans. Tehran newspapers on Monday published comments by Iranian Foreign Minister Ali Akbar Velayati that Banisadr had no credibility and his accusations were groundless. A spokesman for Berlin justice authorities said Banisadr, who says his information comes from secret sources within the Iranian government, would resume his testimony on September 5. One Iranian, Kazem Darabi, and four Lebanese are charged with murdering four exiled Iranian Kurdish leaders and their translator in Berlin's Mykonos restaurant in September 1992. Prosecutors have issued an arrest warrant against Iranian Intelligence Minister Ali Fallahiyan in connection with the killings. They said last week they would also examine the possibility of filing charges against Khamenei and Rafsanjani in the light of Banisadr's evidence. Banisadr returned in triumph from exile with Ayatollah Ruhollah Khomeini when the 1979 revolution pushed the Shah from power. He was elected Iran's first president, but again went into exile in France in 1981 after being ousted by hardliners. 3539 !GCAT !GENT !GPOL !GPRO Former businessman and soccer boss Bernard Tapie said that he would give up his seat in the National Assembly by Wednesday, the day a film by Claude Lelouche in which he stars opens in France. "I will no longer be deputy by the time the film opens," he said in a broadcast interview. "Just about," he told Europe 1 radio when asked whether he had sent his letter of resignation to Assembly speaker Philippe Seguin. A Seguin spokeswoman confirmed that no letter or call had yet been received. Tapie, 53, was resigning just ahead of expected government action to eject him from the Assembly following a finding by the Supreme Court that he was bankrupt and thus ineligible for public office for a five-year period. Tapie, the target of a blizzard of legal actions over his now-destroyed business empire and the Marseille soccer team he once ran, has a starring role in Lelouche's "Homme, femmes: mode d'emploi" (Men, women: instructions for use). He plays a power-hungry lawyer in the movie described as "a tender and cruel comedy" by Lelouche, who is making his 35th film. "I have paid too dearly for mixing two careers," Tapie said. "In France, you cannot be a film artist and a national politician at the same time. That is why I will no longer be deputy by the time the film opens." Justice Minister Jacques Toubon began last month the formal process of ejecting Tapie from the French parliament as well as stripping him of his seat in the European parliament. The French procedure was expected to be completed before October 2, when the National Assembly is to reconvene after a summer break, but the European procedure was expected to take longer. Tapie's lawyer has said he intends to appeal to the European Court of Human Rights in an effort to prevent or delay the loss of his European seat. But such an appeal, even if the court were to accept the case, which it is not obliged to do, would not suspend enforcement of the French judgement against him. Tapie faces a probable spell in prison after he loses his parliamentary immunity, since two appeal courts have confirmed jail sentences of eight and six months against him for tax fraud and rigging a soccer match. He is appealing in both cases to the Supreme Court. 3540 !GCAT !GCRIM !GODD An Italian court has awarded a couple 1.17 million lire ($780) compensation for the death of their child, arguing that the son of a land labourer would never have been able to make much money. The ruling, announced at the weekend, was blasted as "classist" by the boy's father, who works on a farm in central Italy. "I will send the money back to the justice ministry so they can pay for a course to re-train the judges that passed this ridiculous sentence," Sesto Gherri told reporters on Monday. Gherri asked the court to award damages after his 12-year old son Luigi was killed in a road accident in 1985. A judge in the central city of Bologna wrote to Gherri at the weekend saying he thought the boy would have worked with his family on the land after he left school and then got married. "Presumably all his earnings would then have gone on supporting his own family," the judge said. Land labourers' wages are traditionally very low in Italy. "The sentence shows a classist vision of society," Gherri's lawyer, Giulio Cesare Bonazzi, told reporters. "The judges behaved as if there were casts, where the son of a farmer could only have become a farmer." 3541 !E12 !ECAT !G15 !G154 !GCAT !M13 !M132 !MCAT Finland and Sweden have no joint plans regarding Europe's exchange rate mechanism (ERM) or Economic and Monetary Union (EMU), Finnish Prime Minister Paavo Lipponen said on Monday. "Finland and Sweden have no joint plans," Lipponen told a news conference in response to a question about ERM and EMU. He declined further comment. Swedish Prime Minister Goran Persson, who also attended the news conference, said Sweden would meet the convergence criteria for EMU but did not elaborate. The news conference was held at the end of the five Nordic countries' prime ministers' one-day summer meeting in Helsinki. Finland said its objective was to be among the first countries to join the third phase of the EMU, scheduled for start-up in 1999. Sweden has voiced some reservations and a decision for or against EMU is expected by the ruling social democrats in the autumn of 1997. Finland has said a decision whether to link the markka to the ERM would be made this autumn. Sweden has not set a timetable for any possible ERM decision. --Veera Heinonen, Helsinki Newsroom +358 - 0 - 680 50 240 3542 !GCAT !GPOL !GVOTE Greek socialist Prime Minister Costas Simitis called on Monday for a low-key campaign before snap elections on September 22 with no big rallies, no personal attacks but with televised arguments on the country's problems. "We say no to chicken fights, false promises, meaningless rallies and plastic flags. We are against negative propaganda and blows below the belt," Simitis told reporters on his PASOK party's campaign plans. Simitis said a recent law put a lid on what parties could spend during the campaign period and warned against excesses. His call for calm marks an end to Greece's passionate campaign periods where party leaders spent most of their time in ruthless personal attacks at huge campaign rallies instead of laying out their policies. Simitis said he would hold a televised debate with main conservative opposition party leader Miltiadis Evert, the first-ever in the country's campaign history. Late PASOK founder Andreas Papandreou, whom Simtis succeeded in January, based much of his campaign activity on fiery speeches before hundreds of thousands of flag-waving supporters in major Greek cities. He had refused to participate on televised debates with Evert's predecessor in the opposition, former conservative prime minister Constantine Mitsotakis, citing personal dislike. The Greek press had dubbed Papandreou and Mitsotakis as "the gladiators." They often called each other in public "traitor", "liar" and "thief". "I don't see my meeting with Mr Evert as a duel but as an opportunity for dialogue and debate," Simitis said. "The Greek people don't need boxers and gladiators. They need to compare and judge between proposals, solutions and leaders." Simitis said PASOK deputies and himself would travel through Greece in buses to inform voters on PASOK's policies. "The victory express with the message of hope will tour the country," he said. The prime minister will outline his government's economic plans at the start of an international trade fair in the northern city of Salonika on September 7 and PASOK will hold only one pre-election rally in Athens on September 20. Evert was the one who first proposed the televised debate with Simitis and has also called for a calm campaign. 3543 !E51 !E512 !ECAT !GCAT !GDIP France on Monday played down a message it sent Libyan leader Muammar Gaddafi calling for better relations as mere diplomatic routine rather than a challenge to Washington's new sanctions law. "I'm surprised that so much importance was given to this message," French foreign ministry spokesman Jacques Rummelhardt told reporters, saying it was conveyed by the new French envoy to Tripoli at her credentials ceremony. "It is very rare for an ambassador to hand over credentials which say: 'I am here to spoil relations'," he said, when asked if the message was a challenge to U.S. sanctions law targeting new foreign oil and gas investments in Iran and Libya. French President Jacques Chirac was quoted as saying in the message that he hoped for the best possible relations between Paris and Tripoli. "There was a ceremony at which our new ambassador Josette Dalan gave her credentials to the Libyan foreign minister...As in many countries there was an exchange of messages which looks to closer ties between the country of the ambassador and that of his hosts," Rummelhardt said. The sanctions law, intended to punish countries seen as backing terrorism, has sparked protests from several of Washington's partners, including France. 3544 !G15 !G158 !GCAT !GDIP The European Union said on Monday it was pleased with moves by Croatia and rump Yugoslavia to normalise relations, saying they were making a constructive contribution to peace and stability in the region. In a statement, EU president Ireland said it also welcomed the intention of Zagreb and Belgrade to address and resolve matters concerning the rights of citizens who suffered during the conflict in former Yugoslavia. The two countries signed an agreement on August 23 calling for mutual recognition and the exchange of ambassadors. The EU statement urged the two parties to implement the agreement fully without delay. 3545 !E12 !ECAT !G15 !G154 !GCAT !M13 !M132 !MCAT Prime Minister Romano Prodi said on Monday he was determined to pursue the goal of joining a European currency union despite a call from his deputy for Italy to review membership terms with other European Union partners. Prodi was quoted in an Italian newspaper on Monday as saying that asking for a revision of the Maastricht treaty -- which lays down strict quidelines for European economic and monetary union (EMU) -- was out of the question. "We can't ask for a revision of the Maastricht criteria. Italy cannot and does not want to do it," Prodi told Rome's La Repubblica daily newspaper. "We can't and don't want to for a very simple reason -- our (1997) budget...is a message the markets need, the message they have to receive so that interest rates fall," he said. Prodi made his remarks a day after his deputy prime minister, Walter Veltroni, said Italy and other EU countries should re-consider the criteria and timing for monetary union. Veltroni ruled out unilateral action by Italy but his comments fanned a debate sparked by worries that the sharp tightening of the fiscal screws needed to meet the EMU criteria could tip Italy's sluggish economy into recession. One of Italy's most powerful industrialists, Cesare Romiti, said last week it might be worthwhile for Italy to delay joining a currency union if it would help cut high unemployment. The speech by Romiti, who is chairman of the Fiat cars group, raised eyebrows because Italian industrialists have traditionally been among the most enthusiastic supporters of joining EMU at the earliest opportunity. The government has already acknowledged that a small delay for Italy in joining EMU is inevitable because a key Maastricht target -- cutting the ratio of debt to economic output to three percent by end-1997 -- cannot be reached on time. Prodi and his economic team fear that any effort to negotiate less stringent terms for EMU membership would bring down the wrath of the financial markets, ever sensitive to any sign of a weakening in Italy's fiscal resolve. That could derail a key component of Prodi's strategy, to lower inflation and allow the central bank to cut interest rates and thereby alleviate a crushing burden of interest payments on Italy's huge national debt. One of Prodi's closest allies in the government, Defence Minister Nino Andreatta, said any attempt by the government to wriggle out of its Maastricht obligations would spell disaster. "The next day the markets would punish us, the price of treasury securities and shares would fall...It would be clear to all that Italy does not want to give up its financial indiscipline," he told La Repubblica. Economists said Italy could pay a high price just for the current debate over the Maastricht terms if it got out of hand. "This debate could be damaging. It gives the impression that at the first sign of trouble you look for a short cut," said Mario Noera, chief economist at Deutsche Bank in Milan. But the real test for the financial markets will come in September when the government unveils details of its plan to cut 32.4 trillion lire ($21 billion) from the 1997 state budget. Prodi faces a hard task finding extra revenue and cutting spending while at the same time sticking to a pledge to leave the bloated pension and health care systems unscathed. "The budget is a hard test and will weigh heavily on the future credibility of the government," said Noera. 3546 !C24 !CCAT !GCAT !GDIS At least three workers were killed by an explosion at Repsol SA's refinery at Puertollano on Monday morning, Spanish National Radio said. Repsol spokesmen were not immediately available to confirm the news. Efe news agency said a boiler had burst in unit 20 of the plant, which has a crude oil capacity of around 135,000 barrels per day (bpd). The local government confirmed an explosion had happened but had no further details. 3547 !GCAT !GODD Vienna's Dorotheum auction house said on Monday it was taking the unusual step of putting a horse under the hammer at a sale of vintage automobiles. "Roberto," a 14-year-old dark brown Holstein gelding, is the first entry in the catalogue for the September 4 sale at a starting price of 6,500 schillings ($625). The Dorotheum, established in 1785 and the world's second oldest auction house, said those wishing to size up Roberto would not find him among his fellow exhibits, such as a 1940 Opel, but in the comfort of his stable outside Vienna. 3548 !GCAT !GCRIM !GPOL !GVIO A Paris court picked its way through a legal tangle on Monday to decide the fate of scores of African immigrants after the government decided to send most of them back home. Riot police ringed the administrative court as it considered appeals against expulsion orders for about 80 of 210 protesting immigrants forcibly ejected from a Paris church last week. An IPSOS opinion poll published by the daily Le Monde showed voters split on the government's policy to firmly enforce the hardline immigration laws while carrying out a case-by-case review of the protesters' situation on humanitarian grounds. Forty-six percent approved and 46 percent rejected it. The 10 hunger strikers among the Africans called off a 52-day fast on Sunday. Police said only one of them would qualify for a residence permit and the rest would be expelled. "They have started taking mashed food as they are unable to eat any solid food. They are very tired," said their spokesman, Doro Traore. The protesters were resting after moving their headquarters to a disused ammunition factory in the eastern Vincennes suburb. Some were enjoying the sunshine in the Vincennes park after weeks holed up in the Saint-Bernard church. Lawyers managed to get most protesters released at the weekend in a legal battle to keep them in the country, prompting some media to accuse the government of confusion. "The Great Muddle," the left-wing daily Liberation said in a headline of the confusion about the legality of expulsion orders. Police stood guard outside the court after riots broke out among sympathisers on Sunday night when the court announced that it had rejected 12 of 20 appeals against expulsion. Traore said all but 15 of the protesters were free and in the care of human rights groups. Four were deported to Senegal, Mali and Zaire on a French air force plane at the weekend. Three others had been sentenced to two to three months in prison, and a few were still held. Interior Minister Jean-Louis Debre has said 30 to 40 percent of the protesters would be allowed to stay in France. His adviser on immigration, Jean-Claude Barreau, told Liberation the percentage could reach two thirds. President Jacques Chirac has pledged to stick to the strict 1993 laws, despite a furore from left-wing parties and human right groups, in order to send a "strong signal" to discourage potential immigrants from poor countries. He promised to review details of the enforcemnt of the laws, which the protesters say outlawed immigrants previously living legally in France, and promote aid to poor nations. He said French people, regardless of their politics, felt "a growing irritation over immigration". The IPSOS poll said 46 percent of voters sympathised with the protesting immigrants, to 36 percent who were hostile. It showed the electorate divided on the 1993 "Pasqua" laws pushed through by then interior minister Charles Pasqua. One third said they should be made stricter, 35 percent wanted them unchanged, 20 percent wanted them softened and four percent wanted them repealed altogether. Eight percent had no opinion. 3549 !GCAT !GPOL !GVIO The new Spanish government's Basque allies accused it on Monday of having struck a secret deal with its Socialist predecessors to cover up a 1980s "dirty war" against separatist ETA guerrillas in which 27 people died. "There is no desire here to get to the bottom of this matter," Inaki Anasagasti, spokesman for the moderate Basque Nationalist Party (PNV), told a radio interviewer. "They are erecting as many obstacles as they can." After considering the issue for three months, Conservative Prime Minister Jose Maria Aznar and his cabinet decided early in August to keep military intelligence files on the anti-ETA drive under lock and key, rejecting court requests for access. Anasagasti, whose party helped Aznar form a government in May, said the decision cast doubt on the rule of law in Spain and prompted comparisons with Chile's handling of murders committed by security forces in the 1970s under the dictatorship of General Augusto Pinochet. "Are we in a democracy or what is this?" Anasagasti asked. "There is an iron pact at work here between certain (political) parties." Aznar's decision to deny the courts access to secret files on the 1983-87 campaign of bombings, kidnappings and murders contrasted sharply with his use of this "dirty war" in campaigning against his Socialist predecessor, Felipe Gonzalez. Gonzalez's government had already rejected the courts' requests in what Aznar's Popular Party described at the time as a move aimed solely at shielding the Socialists from prosecution. Gonzalez and his associates deny charges by former security chiefs and disgruntled Socialists that they engineered the "dirty war". The Socialists' first interior minister is on trial at the Supreme Court, accused of creating and funding the self-styled "Anti-Terrorist Liberation Groups" (GAL) death squads that waged the illegal campaign. Anasagasti's charges of a behind-the-scenes deal to bury the matter follow a warning by PNV leader Xabier Arzalluz this month of unspecified dire consequences in case of a cover-up. Arzalluz said people in the Basque Country, where about one in 10 voters supports ETA (Basque Homeland and Freedom), might accept a blanket amnesty or a pardon for "dirty warriors" but only if the state first admitted its responsibilities. With five of the 350 seats in the Spanish parliament, the PNV is a secondary ally of Aznar. Unlike Catalonia's ruling coalition, whose support is vital to the government's stability, its strength lies not in numbers but in the symbol of regional support for a centre-right administration. Anasagasti warned that covering up the "dirty war" could bolster ETA sympathisers' arguments that the Spanish state still behaves towards the Basque Country as it did under dictator Francisco Franco. He compared the decision on the secret files to a ruling by the Chilean Supreme Court last week that closed the book on the 1976 murder, under Pinochet, of Spanish diplomat Carmelo Soria. The court applied a 1978 amnesty to the case and lifted all charges against two retired army officers accused in the murder. "We believe the GAL ("dirty war") issue will end up like the Carmelo Soria case in Chile, where the army has obtained an amnesty" Anasagasti said. "With all due regard to the differences, the Carmelo Soria case is like the GAL case." 3550 !E12 !ECAT !G15 !G154 !GCAT !GPOL !M13 !M132 !MCAT Swedish Prime Minister Goran Persson said on Monday he was not unduly concerned by differences of opinion within his ruling Social Democratic Party's parliamentary group about Swedish EMU membership. "No, in fact it's the other way round...we have constantly sent signals that it's a full year before we make a decision," Persson told Swedish radio. The Social Democrats will vote on EMU (Economic and Monetary Union) membership at a party congress to be held in autumn 1997. Swedish radio's Ekot news programme asked 145 of 161 Social Democratic members of parliament about their attitude to EMU membership. Of the 161, 39 were in favour, 43 were against and 63 said they were undecided. Persson said the poll gave a good indication of the differences of opinion in the party on the EMU issue. But he said he was not worried that the question would split the party. "People said the entire EU discussion would split the party and it hasn't...we'll cope with the EMU question as well," he said. -- Stockholm newsroom, +46-8-700 1006 3551 !E21 !E211 !ECAT !GCAT !GHEA The French government has decided not to create a new universal healthcare tax in order to help pay down the social security deficit, financial daily Les Echos reported on Monday. The government was likely instead to widen the net and raise the rate of the Generalised Social Contribution (CSG) tax, the paper said. The increase in the CSG would probably be offset by a one percentage point lowering of payroll charges devoted to healthcare. The new CSG tax would probably be deductible from income, Les Echos said. The government is planning to announce its broad decisions on tax reform around September 10. Les Echos said the government would probably adopt many of the changes suggested in June by a tax reform commission headed by Dominique de La Martiniere, a former head of the French tax office. Other changes under consideration include cutting the top marginal income tax rate to 40 percent from 56.8 percent over five years and scrapping a wide range of tax breaks, allowances and professional tax allowances. The lowering of income tax rates would be financed by doing away with many of these tax "niches". For the time being, the government is not considering lowering the cost of a television licence. The government is considering doing away with a system of allowances for people on low income and replacing it with a higher income tax threshold, Les Echos said. It is also mulling scrapping the 20 percent abatement which applies to most forms of income. It would make up for this in the lowering of all income tax rates. -- Paris Newsroom +331 4221 5071 3552 !E12 !ECAT !GCAT !GPOL The German government, reopening for business on Monday after the summer break, declared itself determined to push its austerity package through parliament despite delaying tactics by the opposition Social Democrats. The SPD looked likely to use its majority in an arbitration committee of both houses of parliament later in the day to reject parts of Chancellor Helmut Kohl's programme of spending cuts and supply-side reforms aimed at cutting firms' costs. Peter Hintze, general secretary of Kohl's Christian Democrats, told German radio: "Despite the announced resistance of the opposition there will be a very rapid implementation of the austerity programme." He said the parts of the plan that the SPD would reject later in the day, such as cuts in sick-pay and a reduction in workers' protection from firing, could be pushed through parliament next month with the so-called "Chancellor Majority". While the SPD-dominated upper house of parliament, or Bundesrat, must be consulted on large chunks of the austerity package, it can only in reality block the parts related mainly to tax changes. "In the end 90 percent of the projects do not need Bundesrat approval," Hintze said. Although the negotiations between both houses on the 1997 tax bill do not kick off in earnest until October, the chunks being discussed on Monday should be finally approved by Chancellor Majority on September 13. Kohl unveiled the austerity plan in April. It aims to slash public spending by 50 billion marks ($33.84 billion) and social security spending by 20 billion marks next year to ensure Germany meets all the entry requirements for the single European currency. Of the 70 billion marks, over half has already been passed. Around 15 billion alone was achieved through a moderate public sector wage deal and other large savings have been agreed in pension and health spending and in all government departments. Hintze criticised the SPD's delaying tactics, and said: "The programme will cut the cost burden and mean no further rise in social security contributions but will ensure we keep the high social welfare level we have already reached." SPD leader Oskar Lafontaine told German radio on Sunday evening his party was duty-bound to make clear that it would prefer to see other policies. "And when it comes to things which do need our agreement, such changes to child benefit, we intend making sure this goes ahead as planned." Kohl's government hopes to save three billion marks next year by delaying by a year a hike in child benefit originally agreed for January 1997. Lafontaine repeated the SPD would also fight, in the 1997 tax bill talks, things like a planned scrapping of wealth tax. The arbitration committee was likely to reject quickly the parts of the austerity drive which can be pushed through with the Chancellor Majority but to talk well into the evening about sick pay cuts for civil servants and the delay in the child benefit rise, both of which the SPD can block. Gerhard Schroeder, Lower Saxony state premier and a leading voice in the SPD, has proposed throwing these latter points into the 1997 tax bill talks in October so that all legislation requiring SPD approval can be dealt with together. The lower house of parliament, or Bundestag, will hold a special session on Thursday to consider the outcome of the arbitration committee meeting. ($1=1.4777 Mark) 3553 !E12 !ECAT !GCAT !GPOL The French are returning from their holidays in a depressed mood, disappointed by economic weakness and continued budget austerity which could lead to a difficult autumn for the government. According to a poll published in the Le Parisien newspaper on Monday, 54 percent of the French are pessimistic about "La Rentree" - the big return to work, school and political business. Strikes, poverty and job losses topped voters' worries, the CSA survey of 1,005 people showed. The poll also found that 78 percent of those polled expected troubles for the centre-right government when the summer holidays end. Of the people surveyed, 52 percent fear strikes and social unrest the most. President Jacques Chirac on Sunday said he did not know whether there would be unrest after the summer break as threatened by unions, who say conditions are right to revive unrest to match a crippling 24-day wave of strikes in late 1995. Financial markets are uncertain and the franc, bonds and shares remained under pressure due to worries about the reaction to France's 1997 austerity budget. If the government led by Prime Minister Alain Juppe manages to get the budget accepted by parliament and country, economists are sceptical it will be enough to reach the government's goal of a budget deficit of three percent of gross domestic product (GDP) needed to qualify for European monetary union. Chirac and Juppe have to deliver on a promise of lower taxes from 1997 while at the same time finding at least 60 billion francs ($12 billion) in spending cuts. On top of that, the social security system is heading for a deficit of about 49 billion francs, much more than the forecast 17 billion francs. "Defici-busting has the highest government priority but still more needs to be done," Smith Barney economists Paul Horne and Steven Englander said in their daily note to investors on Monday. "Social nastiness in reaction to accumulating austerity measures is abuilding and will be increasingly evident in the streets in September," they added. A series of key dates starts on Tuesday with a meeting of the main teachers' unions. Some teachers' unions have already announced strikes over perceived government plans to cut 2,300 posts in education. On Wednesday the government has its first cabinet meeting after the summer break and a ministerial seminar on the budget. Louis Viannet, head of the Communist-led CGT union will hold a news conference the same day in which he is expected to warn the government against any attacks on the welfare system. On Friday August 30, the July unemployment figures are due. Unemployment, at record levels, remains a major thorn in the side of the government. But the level is not expected to fall any time soon. Juppe said on Sunday that around September 10 he would present both the 1997 budget and the social security financing plan as well as plans for a tax reform. As soon as September 11, the government could present the cabinet with the 1997 budget. Activists have planned protest meetings and news conferences to follow hard on the heels of the budget presentation. 3554 !C13 !C31 !C312 !CCAT !G15 !G153 !GCAT !M14 !M141 !MCAT A large sale of French wheat to Egypt heralds a likely tussle between the European Union and exporters over export subsidies after the deal was concluded at what traders described as "very low prices". Traders said it would be hard to cover unless the EU awarded export rebates, but member country officials said the commission appeared unwilling to grant refunds on soft wheat. On August 24 Egypt bought 200,000 tonnes of French wheat for October shipment at $178 per tonne fob. It also purchased 100,000 tonnes of US soft red winter wheat at $176 per tonne for shipment in September, and 50,000 tonnes of U.S. wheat at $178 per tonne for October shipment. "This is a bargain-basement price. The (French) sale will be hard to cover unless the EU grants export refunds," one trader said. Citing last Thursday's award of 145,350 tonnes of EU soft wheat at around $183 per tonne fob France, traders estimated that at current prices the French wheat sale called for an EU export subsidy of between seven and eight Ecus per tonne if sellers were to make a profit on the deal. Operators are hoping that lower world prices and expectations of a higher than anticipated EU grain harvest will convince the Commission to relax its tight grip over supplies and revert to giving out export subsidies. But the Commission appears reluctant to make a move until it gets gets a firmer crop picture, member country officials said. "At this stage the Commission appears unwilling to grant soft wheat refunds," one source said. European Commission officials are estimating that this year's harvest may rise by some 14 million tonnes to around 190 million tonnes. Rouen wheat for September-December delivery was unchanged at 890 francs per tonne, excluding carrying charges, in early morning trade on Monday. --Dominique Vidalon, Paris newsroom +331 4221 5432 3555 !E41 !E411 !ECAT !GCAT !GJOB The Swiss Federal Statistics Office said Swiss full-time employment fell 0.8 percent in second quarter 1996 from the same quarter in 1995, to 2.578 million jobs. The Statistics Office said the decline was strongest in the industrial and commercial sectors, where the decline was 2.1 percent, while the service sector showed a stable trend. Full-time jobs fell a sharp 9.1 percent in the textile industry. The electronics industry had a 1.8 percent drop. The chemical industry showed a drop of 1.2 percent. Part-time employment rose 1.6 percent compared with second quarter 1995 to 422,000 jobs. -- Zurich Editorial, +41 1 631 7340 3556 !G15 !GCAT Following are highlights of the midday briefing by the European Commission on Monday: Commission spokesman Thierry Daman said Emil Noel, Commission secretary-general between 1958 and 1987, had died. Daman read a telegram from Commission President Jacques Santer conveying his condolences to Noel's widow. Santer said Europe was in mourning at the news of Noel's death. In response to a question, Daman said nothing had changed in the Commission's position concerning the dispute with Germany and Saxony over state aid to Volkswagen. He noted that Saxony had filed a complaint against the Commission with the European Court of Justice. He said that the Commission's position was that unless Saxony and Volkswagen adhered to the law, the Commission could not exclude filing its own case before the court. Such a suit would likely be filed against Germany, he said. No documents were released. 3557 !C17 !C34 !CCAT !G15 !G157 !GCAT Kurt Biedenkopf, premier of the German state of Saxony, on Monday defended the state's decision to ask the European Court of Justice to rule on its subsidies for auto maker Volkswagen AG. "We must grow accustomed to the idea that putting a European Commission decision to the test in court is not the same as putting Europe in question," Biedenkopf told a gathering of VW managers. Saxony filed the complaint on Friday, the day EU Competition Commissioner Karel Van Miert and German Economics Minister Guenter Rexrodt failed to resolve differences in a personal meeting. The row erupted last month when Biedenkopf decided to go ahead with the subsidies over Commission objections. The commission approved only 540 million marks ($365.5 million) of a proposed 780 million marks in subsidies. Biedenkopf told the VW managers the Commission was not a government but a bureaucratic body. He said the relationship between Saxony and VW was one of cooperation, not blackmail as Van Miert suggested last week, and said Saxony was convinced the subsidies for VW were legal. Saxony was one of the most industrialised regions in Germany before World War Two, and suffered greatly under the communist east German government. VW chairman Ferdinand Piech welcomed Saxony's decision to continue subsidies as a decision that backed jobs and people in the region. The expansion of the VW plant created 1,000 jobs at VW itself and 2,000 jobs at suppliers, he said. 3558 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Bouygues on Monday denied a report in the Lettre de l'Expansion newsletter saying it was seeking 2,000 job cuts in 1996. The company said it was doing all it could to solve its problem of overstaffing at its French construction activities with internal transfers to other divisions. 3559 !GCAT These are leading stories in Monday's afternoon daily Le Monde, dated Aug 27. FRONT PAGE -- Ipsos poll reports majority of French public opinion sympathises with plight of Africans seeking to renew or obtain work and residence permits, calling government "stubborn," "confused" and "cold-hearted." BUSINESS PAGES -- SNCF railway trade unions want renegotiation of government bailout package, as European Union prepares more proposals to increase competition . -- World steel market shows signs of upturn. -- Paris Newsroom +33 1 42 21 53 81 3560 !GCAT !GODD A drunken Swede who commandeered a shopping trolley and collided head-on with a car is to be charged with careless driving, police said on Monday. The 20 year-old man was travelling downhill in the southern Swedish town of Mottala when his impromptu chariot hit the car at an estimated closing speed of 50 kmh (30 mph), police inspector Lennart Johansson told Reuters. Johansson said the man faced a careless driving charge but it was by no means certain the charge would stick. "He was certainly careless, but I suppose it's debatable whether he was driving. He was rather drunk, and his trolley wasn't showing the appropriate lights" Johansson said. The man was released from hospital with minor injuries and a serious hangover. 3561 !G15 !G154 !GCAT !M12 !MCAT The successful creation of an integrated European government bond market based on a single currency could make it rival that of the U.S. and Japan, the Bank for International Settlements (BIS) said. A single European currency would change Europe's bond markets profoundly, but this could bring advantages to both borrowers and investors and possibly boost the stature of the European bond market, BIS said in its latest quarterly report on banking and financial markets. "In an integrated Euroepean government bond market, investors might be more willing to buy large quantities of bonds if they could sell them without encountering reduced liquidity and any associated increase in volatility," BIS said. Prospective interest savings through higher liquidity could encourage cooperative debt management and governments could auction issues jointly with identical coupons and maturities. Governments could also match each others' coupons and maturities, in effect reopening each others' issues. "Were the similarities to prove sufficiently strong that the bonds were covered by a single set of exchange-traded futures contracts, then Europe's main bond market would join those of the United States and Japan in terms of size and liquidity," BIS said. While the exchange and inflation risks would not distinguish between government bonds within a single currency Europe, markets would still distinguish between the creditworthiness of various governments, much like markets price provincial or state debt in federal systems, BIS said. Another possibility is that the bonds of some or all of the governments participating in Europe's monetary union could trade interchangeably. Markets are already allocating very slight differences to the credit ratings, single market bond yield spreads and swap spreads between the countries that are seen as likely candidates for early entry to EMU in 1999, according to a poll of market participants taken in January 1996, BIS said. 3562 !GCAT AUSTRIA DIE PRESSE - Paper producers are in trouble due to unpredictability of the market and frequent price changes in the past. - Finance Minister Viktor Klima has criticised the social partners and Social Affairs Ministry in connection with labour contracts and social insurance contributions. DER STANDARD - Social Democrat EU candidate Harald Ettl said voters may use the October 13 European Union vote as an opportunity to express dissatisfaction with the ruling Social Democrat-People's Party coalition. - Austria's textile makers demand a halt in the liberalisation of EU's textile industry, to withstand growing pressure from Eastern Europe. KURIER - Austrian Transport minister Rudolf Scholten has announced that 1 billion schillings will be invested by the government in new technologies next year. SALZBURGER NACHRICHTEN - Austrians are buying less gold than in the years before, but Kerry Tattersall marketing chief of Muenze Oesterreich expects a rise due to low bank rates and the end of anonymity of securities accounts. BULGARIA 24 CHASA -- The European Union has asked Bulgaria to cut its metal exports to the EU countries due to current stagnation of European metal markets, trade minister Atanas Paparizov said. -- Extension of the second tranche under the credit agreement between Bulgaria and the International Monetary Fund (IMF) will depend on the progress in the financial restructuring of loss-makers, IMF sources said. PARI -- A tender for oil and gas drilling concessions in Bulgaria will be held at the end of this week and the beginning of next week, Geology Committee general secretary Kolyo Tonev said. -- Bulgaria's internal debt has risen by 69 percent for the first seven months of the year and totalled 582.5 billion levs at the end of July, the Finance Ministry said. -- Bulgaria's national carrier Balkan Airlines expects some one milion dollars for the transportation of UN peacekeeping forces after winning a UN tender, company officials said. TRUD -- Foreign minister Georgi Pirinski left on a six-day working visit to the United States where he is expected to seek support for Bulgaria's full membership in the World Trade Organization. STANDART -- Ivo Nedyalkov, the president of Bulgaria's get-rich-quick fund East-West International Holding, has been arrested in France, Interpol officials in Paris said. -- The Bulgarian-Russian Investment Bank (BRIB) is expected to raise its capital to five billion levs from 1.25 billion levs to meet new central bank minimum capital requirements, the bank's executive director said. -- Sofia Newsroom, (++359-2) 981 8569 CROATIA VJESNIK - Elections in Bosnia-Herzegovina: Croats must be guaranteed equality, says Bosnian HDZ party leader Bozo Rajic at an election rally. Mufti Dzemal Gardar calls for jihad at a Moslem party SDA rally in southern town of Capljina. - Ancillary bishop Marijan Srakic denied access to Lipovac parish in Serb-held Eastern Croatia. - Transport Minister Zeljko Luzavec vows better ferry links between northern and southern Adriatic coast for next summer. - Capital market: Share prices poised for a new rise in the autumn. VECERNJI LIST - More affordable loans for farmers: 95 million kuna to be allocated for homesteads. - State salaries have been rising despite a government clamp-down. Between January and June 1996 total salary payout in banks and other financial institutions has risen by 20 percent, while in institutions not funded by the state budget by 25 percent. - The first rally of the Croatian Democratic Union (HDZ) of Bosnia-Herzegovina held in Sarajevo: A historic day for the Sarajevo Croats. SLOBODNA DALMACIJA - A new political party to emerge on the Croatian political scene: DEHOS for Croatia headquartered in Germany and with branches in Zagreb, Split and Rijeka is to be made up of the Social-democratic union, Dalmatian action as well as a number of left-oriented people from the Croatian political scene (including former communist Stipe Suvar). -- Zagreb Newsroom, 385-1-455775 @ CZECH REPUBLIC HOSPODARSKE NOVINY - The Czech Republic is expected to sign the second protocol of the Gerneral Agreement on the Trade of Financial Services this week in Geneva, the seat of the World Trade Organization. - Agriculture Minister Josef Lux stated that a yearly increase in food prices of 10 to 15 percent is realistic considering the inflation rate. - A significant decrease of dynamic mutual trade between the Czech Republic and Austria will be one of the themes of today's meeting between Trade and Industry Minister Vladimir Dlouhy and the new Austrian Economic Affairs Minister, J. Farnleitnerem. - Legal services have increased by up to 250 percent due to a new proclomation on legal services which went into effect July 1. This replaces regulations dating to 1990. - Some 61.2 percent of Czech citizens, or 6.319 million people, are at a productive age between 15 and 59 (or 54 for women). The entire population of The Czech Republic is listed at 10.317 million people. - Milko, a.s., once a leading dairy in North Bohemia, has been forced to restrict its production to one-tenth of its capacity of 150 thousand litres. - Grafo Ceske Budejovice, a.s., a manufacturer of writing utensils, and Koh-i-noor Hardmuth, a.s., the leading domestic firm in the area of school and office supplies, will merge as of January 1, 1997. PRAVO - Half of the shares of Chemapol Group a.s., one of the fastest developing Czech companies, belongs to banks, according to the general manager of Chemapol Group, a.s.. Komercni Banka, CSOB, Agrobanka, Ceska Sporitelna, Investicni a Postovni Banka and Union Banka Ostrava all hold Chempaol shares. - Ceska Pojistovna intends to increase its basic capital by 1.137 billion crowns to 3.412 billion crowns through a new emission of shares. A shareholders' meeting scheduled for September 5 will decide on the emission. - The Czech Republic and Norway are expected to sign a contract before the end of the year for the delivery of natural gas. The deliveries should begin in 1999. At first, one billion cubic metres of gas will be delivered, and will increase to two billion cubic metres at a later date. - The debt Russia owes the Czech Republic, mentioned as a major reason for the unbalanced budget, has remained constant at $3.4 billion. MLADA FRONTA DNES - Chemapol Group, which purchased a majority stake in the country's largest weapons company, Omnipol, last week, plans to return the Czech Republic to the top ten weapon-producing countries through an extensive recovery plan. - Defense Minister Miloslav Vyborny stated that NATO will make the decision to accept the membership of the Czech Republic next spring. -- Prague Newsroom, 42-2-2423-0003 @ SLOVAKIA NARODNA OBRODA - Prime Minister Vladimir Meciar said Slovak banks were very interested in buying privatisation bonds which could improve their capital portfolios. He said the banks were asking for an increase in the limit of bonds they could buy. - No anonymous trades with privatisation bonds on the country's over-the-counter bourse, the RMS, have been concluded so far. - Sony launches trial production of TV components at its new plant in Trnava, western Slovakia, on Monday. SME - Interior Ministry sources say there are ongoing problems with leakage of confidential material from the ministry, the Slovak inteligence service (SIS) and the Ministry of Justice. - Meciar said he was not informed of any minister's intention to resign. Last week the media reported that at least interior minister Ludivit Hudek was planning to submit his resignation this week. -- Bratislava Newsroom, 42-7-210-3687 3563 !GCAT NEUE ZUERCHER ZEITUNG - Canon (Schweiz) AG, formerly Walter Rentsch AG, posted a 7.7 decline in first six-month sales to 144.3 million Swiss francs compared to the same period the year before. - Marcel Wenger was elected city president of Schaffhausen at the weekend. TAGES ANZEIGER - Swiss minister Ruth Dreifuss and representatives from cantons in the mountains agreed to ratify the Alp Convention at the Alp summit in Arosa at the weekend. The Convention basically calls for protection of the Alps. - Zurich-based retailer EPA plans to modernise all 37 of its branches over the next six years for over 100 million Swiss francs. - The Swiss government wants to raise the minimum number of signatures required for referendums to 150,000 from the current 100,000. - Erwin Leiser, a documentary filmmaker renowned for his 1960 movie on Hitler called "Mein Kampf", died last Thursday at the age of 73 in Zurich. JOURNAL DE GENEVE - Virgin Express plans to offer flights from Geneva to Brussels for between 115 and 185 Swiss francs starting September 2 have been postponed. 3564 !GCAT These are leading stories in Monday's afternoon daily Le Monde, dated Aug 27. FRONT PAGE -- Ipsos poll reports majority of French public opinion sympathises with plight of Africans seeking to renew or obtain work and residence permits, calling government "stubborn," "confused" and "cold-hearted." BUSINESS PAGES -- SNCF railway trade unions want renegotiation of government bailout package, as European Union prepares more proposals to increase competition . -- World steel market shows signs of upturn. -- Paris Newsroom +33 1 42 21 53 81 3565 !GCAT !GPOL Following are some of the main issues scheduled for debate in the Dutch parliament this week: EMPLOYEES COUNCIL -- Parliament on Wednesday debates controversial proposal to force internationally operating companies to establish 'European' employees council for all their personnel employed in European Union. Companies with headquarters in Netherlands fear Dutch interpretation of EU's legislation on the new councils would give their employees councils too much power. FLEXIBLE WORKFORCE -- Increasing flexibility of highly protected Dutch workforce by measures such as reduced validity of collective labour agreements are up for debate on Wednesday. However, most controversial issue, easing of tight laws governing dismissals, has been postponed to later date. Other debates: TUESDAY: - Review of last year's activities of the intelligence service. WEDNESDAY: - Replacing several advisory bodies by one independent council advising government on energy policy. - Allocating sites for petrol stations to oil companies. Debate behind closed doors. - Prime Minister will play host to Dutch medal winners of Paralympics in Atlanta. THURSDAY: - Extending liability of developers of refuse dumps for environmental damage until decades after dump site is closed. - Adjustment of Benelux trademark regulation to include a ban on imitations of design and modelling of products. - Proposal to prolong Dutch mine disposal unit's presence in Angola as part of UN force. Last week's major political issues: BUDGET -- Cabinet internally agreed on 1997 budget that will be presented to parliament on September 17th. Budget deficit reportedly projected at 2.25 percent of GDP down from 3.2 percent this year and well below the 3.0 percent maximum set for entering EMU in 1999. Cabinet expects projected economic growth at 2.7 percent and job growth by about 100,000. Other: - Government decided state pensions will be partly funded by tax revenues and not just social premiums from 1998. - Duty on tobacco expected to be raised by 0.50 guilders per packet from January 1, 1997. - Purchasing power for lower income groups will be maintained by higher rent subsidies and extra tax deductions. -- Amsterdam Newsroom +31-20-504-500 (fax +31-20-504-5040) 3566 !GCAT !GCRIM A child sex scandal which has shocked Belgium to the core took a new twist when investigators arrested a senior police detective in connection with the case. The arrest added weight to widespread speculation that a paedophile gang, suspected of being led by convicted rapist Marc Dutroux, must have received high-placed protection. The scandal, involving kidnapping, killing and paedophile pornography, had already sent waves of revulsion across Europe, triggered an international manhunt and prompted widespread recriminations. Two kidnapped eight-year-old girls have been found dead, two other girls have been rescued and police are hunting at least two more girls who have been missing for a year. Police have seized more than 300 paedophile video tapes -- some featuring Dutroux -- quantities of magazines, childrens' clothing and drugs used to pacify the young victims. Dutroux, convicted in 1989 for multiple child rape, and associate Michel Lelievre have been charged with abduction and illegal imprisonment. Michelle Martin, Dutroux' second wife, has been charged as an accomplice and three men are facing charges of criminal association. But the arrest on Sunday of Chief Detective Georges Zicot, a specialist in tackling vehicle theft in the southern city of Charleroi, added a new dimension to the scandal. "Georges Zicot was arrested and will be charged with truck theft, insurance fraud and document forgery," Public Prosecutor Michel Bourlet told a news conference. He said two other people were also arrested -- Gerard Pignon, owner of a warehouse where he alleged stolen vehicles were stored, and insurer Thierry Dehaan. Bourlet said Zicot's connection was through Bernard Weinstein, an accomplice of Dutroux. "Dutroux has admitted killing Weinstein after a disagreement between the accomplices in an affair of truck theft," he said. Weinstein was found dead last weekend with the bodies of eight-year-olds Julie Lejeune and Melissa Russo in a house near Charleroi belonging to Detroux, who said they starved to death nine months after being abducted in June 1995. Two girls, Laetitia Delhez and Sabine Dardenne, were rescued from a dungeon in another of Dutroux' six houses 10 days ago and police are hunting for at least two more, An Marchal and Eefje Lambrecks, whom Dutroux has admitted kidnapping a year ago. Bourlet said the investigation into the vehicle theft ring would be added to the inquiry into the paedophile sex scandal. Anne Thily, public prosecutor in the eastern city of Liege where Julie and Melissa lived, told the news conference this was a major case involving some 50 investigators, including two from the U.S. Federal Bureau of Investigation. Police in South Africa are cooperating with the FBI in investigations into a suspected child pornography trade spanning the United States, South Africa and Europe. Recriminations have steadily built up over how Dutroux managed to remain at liberty for so long -- with allegations of protection in high places. Leaked police documents catalogue a high degree of police bungling, incompetence and indifference. There is also widespread disbelief that no one appeared to question how Dutroux, an unemployed father of three with no visible means of support, managed to own so many houses. Justice Minister Stefaan De Clerck has admitted that mistakes were made and ordered an inquiry. Thily said the fate of An and Eefje remained a mystery. The media has speculated that they were sold into prostitution in Slovakia or the Czech Republic where Dutroux was a frequent visitor. Belgian police have been to Bratislava and will visit Prague. REUTER 3567 !GCAT !GODD Michael Schumacher's victory in the Belgian Formula One Grand Prix at Spa-Francorchamps sparked a speeding epidemic on Belgian roads after the race was over. Belga news agency reported that police checked more than 3,000 drivers amd booked 222 for speeding on their way home after the race. Some were clocked doing 180 kilometres an hour (112 miles per hour), Belga said. Schumacher won the race in 1 hour 28 minutes 15.125 seconds at an average speed of 208.442 km/hour (130 m.p.h.). 3568 !E12 !ECAT !G15 !G151 !G154 !GCAT The Bundesbank, almost unrivalled in its power to influence the course of European monetary union (EMU), seemed finally to put a stamp of approval on a single currency last week with a generous policy easing. A surprisingly large cut of 0.3 percentage point in its main money market rate to 3.0 percent smoothed currency markets and let other European central banks cut credit costs, defusing several weeks of tension about the likely success of EMU. But although it floored critics who said the German central bank was bent on undermining a single currency and underlined its growing market sensitivity, analysts cautioned against interpreting the move as a dramatic shift to a pro-Euro policy. "I would not rush to pin this up as the action of an embryo European central bank," said Alison Cottrell, senior international economist at PaineWebber in London. The benefits to EMU stemmed rather from a happy coincidence of domestic needs meshing with external factors. Analysts said the chances of the fiercely-independent Bundesbank shooting itself in the foot to bail out others remained minute. "The Bundesbank has no inflation risk at the moment which means it is allowed to look at other factors...such as the world economic environment," Cottrell said. Mathias Haffner, economist at BZW agreed. "There is certainly an international aspect to this and it at least gives a sign that the Bundesbank is not out to block EMU. "But they would not have cut rates if they had not been satisfied with M3 developments and we will have a rate rise when they think that is right, regardless of EMU," he said. The bank itself justified the easing, which slashed the repo rate to an historic low, with a slowdown in growth in its main monetary policy indicator, M3 money supply, and low inflation. The justification came as no surprise to Bundesbank watchers, long accustomed to the bank's untiring efforts to make markets understand that the German central bank must by law set price stability as its absolute priority. Yet the move, which this time acted to help Europe's EMU aims, stemmed from exactly the same motive as previous interest rate decisions which threatened to scupper the single currency project -- meeting Germany's best interests. In the summers of 1992 and 1993, the central bank presented a clear case for raising rates and keeping them high, arguing that placing Europe's anchor currency at risk would not benefit anybody in the long term. Each of those decisions drew international criticism and threw currency markets into fresh turmoil, causing economic agony for countries whose currencies were pegged to the mark. Although the Bundesbank's pursuit of price stability has by no means slackened, economists say today's Bundesbank has to some extent learned from these experiences and now has a much greater awareness of its power to influence markets. This was partly reflected in the size of Wednesday's cut -- pitched to catch markets off-guard by exceeding expectations. In a brief statement about Thursday's decision, Bundesbank president Hans Tietmeyer made no specific reference to EMU or to European currency or economic worries, saying only that the move was "fitting in the general world context". Analysts saw this as an acknowledgment that the central bank was increasingly prepared to look beyond Germany's borders, as long as the domestic situation permitted. Thomas Mayer, senior economist at Goldman Sachs, who said he believed the repo cut sent a very strong message that the Bundesbank cared about EMU, said: "The really different thing now is that they genuinely do look at other European countries and design policy accordingly." But Holger Fahrinkrug at UBS in Frankfurt said he believed that even if the repo cut was motivated by external currency market considerations, the primary motive was still the domestic need to rein in the robust mark. "The currency issue is of course linked in to EMU but I think they were just concerned from a domestic point of view about the strength of the deutschemark," he said. 3569 !GCAT Prepared for Reuters by The Broadcast Monitoring Company -- LLOYD'S PLAN WINS 75 PERCENT SUPPORT Some 75 percent of investors at Lloyd's of London are reported to have accepted the market's 3.2 billion stg recovery plan. The news comes amid continuing speculation as to the likely impact of legal action being pursued by some Names in the US courts. There is some concern that the US challenge to the rescue plan could spark further litigation by investors and place in jeopardy the long-term future of the market. -- LLOYDS CHEMISTS SPURS RIVAL BIDDERS High Street pharmacy group Lloyds Chemists is reported to have informed two rival bidders for the company, Gehe and Unichem, that in securing the sale of certain assets it has met government conditions that should let the bidding process continue. The company has also been making strenuous efforts to combat moves over the past four months to talk down the value of the company, noting that the delays to the outcome of the bids tabled have not impacted adversely on its value. -- BASS SEALS DEAL TO CREATE UK'S BIGGEST BREWER On Sunday, UK brewer Bass agreed to take control of the Carlsberg-Tetley joint venture, thus creating the country's largest brewing business. The agreement is expected to throw into doubt some of the less popular brands currently produced by the group, including Skol. The further concentration of the market is thought likely to provoke an angry response from some of the country's smaller brewers and pub chains, which are expected to demand a referral of the deal to the Monopolies & Mergers Commission. -- JET PROJECT OFFERS SHORTS PROSPECT OF ORDERS AND JOBS There are hopes that Shorts Brothers, based in Northern Ireland, could benefit from plans by parent company Bombardier of Canada to produce a new 70-seat jet aircraft. Shorts recently made 700 staff redundant after the collapse of Fokker of the Netherlands, for which it made wings. Bombardier now hopes to begin marketing a new jet that is scheduled for production before the end of the decade. The new jet is seen as part of a strategy by Bombardier to expand its range of products. -- TORIES HIT AT LABOUR BUSINESS POLICY A new publicity campaign planned by the Conservative party will allege that Labour plans to make takeovers more difficult, and that will have the effect of protecting inefficient firms. The campaign will focus on previous Labour proposals for placing representatives of staff and suppliers on companies' boards. Although the plans do not appear on party policy documents, the Tories will claim that Labour has not actually disowned them. -- SCOTRAIL SELL-OFF TALKS ON TRACK It is planned that talks will take place towards the end of the week between the Passenger Transport Authority in Strathclyde and representatives of the Office of Passenger Rail Franchising in an effort to overcome legal problems that have to date delayed the privatisation of the business. The PTA, which has been blamed by some for delaying the process, will seek assurances regarding the retention of certain powers of control after any sale. -- WELFARE STATE 'NOT A CAUSE OF LOW GROWTH' Professor Tony Atkinson, a prominent academic at Oxford University, will on Monday argue in an article published by the Institute for Public Policy Research that the welfare state does not in itself hinder economic growth. The article claims that in some instances, high welfare spending is a result of poor economic performance and not a cause. The article pays particular attention to the impact on the levels of personal savings of efforts to reduce welfare expenditure. -- LABOUR PLANS LEGISLATION TO OUTLAW GAZUMPING It is reported that the Labour party plans to introduce legislation that would outlaw the practice of gazumping -- delaying tactics sometime adopted by vendors of houses in an effort to increase the price received. In the future, Labour wants the law brought into line with the practice in Scotland where offers accepted by parties involved in house sales become binding at the outset. Some in the property sector have warned that such a move could increase the costs involved in sales. -- SHORT-TERMISM 'UNFOUNDED' The Institute of Directors has described as unfounded claims that the financial system in Britain is guided by short-term goals and holds back the longer-term interests of the economy. The IoD's economic research executive, Stephen Davies, refutes allegations that fund managers in Britain pressure companies to deliver high short-term returns on investment. In a report, he cites the success of new industries such as biotechnology as proof that financiers are willing to take risks. For a full range of news monitoring services, phone BMC +44-171-377-1742 3570 !GCAT Prepared for Reuters by The Broadcast Monitoring Company. DAILY TELEGRAPH -- BAT DRAWS HOPE FROM REJECTED CLAIM BAT tobacco company has said it hopes to overturn a $750,000 damage award to a Florida smoker with news that an Indianapolis court has rejected a widow's claim. The Indiana jury ruled that the four American cigarette companies, including BAT's American Tobacco subsidiary, are not liable for damages demanded by the family of Richard Rogers, who died of lung cancer. -- NATIONWIDE BACKS BECKWITH Nationwide Building Society has said it will provide part of the financial backing for the consortium headed by John Beckwith, the property developer, with the aim to buy and run the Ministry of Defence married quarters. Halifax is expected to sign up this week. Between them, the societies are expected to provide debt finance for up to a third of the purchase price of the estate if Mr Beckwith's bid succeeds. The other bidder is a consortium backed by Japan's Nomura bank. -- ITALY WAVERS ON DEADLINE FOR SINGLE CURRENCY Walter Veltroni, Italy's deputy prime minister, has called for a review of the timetable for European Monetary Union. He said the recession in Europe has been caused by the strict economic conditions that have been set for countries to enter the union by 1999. His views reinforce the suggestion from the chairman of Italy's Fiat motor group, Cesare Romiti, that the country should postpone joining the single currency and instead create jobs. THE TIMES -- BASS REGAINS MARKET LEAD IN 200 MILLION STG DEAL The brewer Bass has purchased Allied Domecq's 50 percent interest in Carlsberg-Tetley for 200 million stg. The deal makes Bass Britain's biggest brewer and has cleared the way for the merger of its brewing business and Carlsberg-Tetley, creating a new giant in the industry with a market share of 35 percent. The merger brings under common ownership some of the UK's biggest brands, including Tetley Bitter, Carling Black Label, Bass, Carlsberg, Castlemaine XXXX and Tennent's. -- LLOYD'S FIGHTS US COURT THREAT TO 3.2 BILLION STG RESCUE A dispute over a US court ruling that threatens Lloyd's of London's 3.2 billion stg recovery plan may go to the US Supreme Court. Lloyd's is seeking to overturn a ruling by a Virginia court in favour of 93 American Names whose demand for more information about the insurance market's reconstruction proposals could delay recovery for years. Lloyd's say that 75 percent of the 34,000 Names worldwide have already accepted the plan before the deadline of midday on Wednesday. -- OFT SPLIT OVER TRAVEL OPERATORS' INQUIRY A dispute over whether travel companies should be referred to the Monopolies and Mergers Commission because of alleged anti-competitive behaviour has split the Office of Fair Trading. The OFT is looking into the way package holidays are sold in the UK by tour operators through travel agency chains they own. Consumer groups claim the public is unaware of the connection between the travel shop and the parent tour operator. THE INDEPENDENT -- OBSOLETE OFFICES FIND A SAVIOUR According to Morgan Lovell, a leading design consultancy, cordless information technology could provide a new lease on life for obsolete 1960s office blocks. A new generation of wireless computer and telephone networks could transform working environments and save many buildings written off as unusable because of today's computing demands. The company believes the biggest challenge lies in changing workers' expectations of their working environment and not changing technology. -- ALLIED MULLS TWO-WAY SPLIT The sale of Allied Domecq's brewing stake in Carlsberg-Tetley is the latest move in a radical restructioning of the group. The recent appointment of Christopher Hogg as chairman has been seen as a prelude to a break-up of the group into its core retailing and spirits operations. Some analysts believe the move might attract higher ratings, if only because the constituent parts could attract a bid approach. -- GEHE AND UNICHEM REBID FOR LLOYDS CHEMISTS Gehe and Unichem could rebid for Lloyds Chemists after the announcement by Lloyds that it has received numerous expressions of interest in buying its wholesaling businesses supplying external customers in a number of UK markets. The Secretary for Trade and Industry said that bids from either Unichem or Gehe could only proceed if those operations were sold. BMC +44-171-377-1742 3571 !C21 !C23 !CCAT !GCAT !GHEA A single dose of a drug that uses monoclonal antibodies to prevent blood clots can cut in half complications after angioplasty, doctors told a conference on Monday. Researchers at Duke University in Durham, North Carolina said the drug, known as ReoPro, cut the need for additional surgery and reduced deaths from heart attacks. Angioplasty involves opening a clogged blood vessel with a tiny balloon. But the procedure can knock loose plaque build-up from inside the artery. ReoPro uses monoclonal antibodies -- proteins that can find and attach to specific cell targets -- to stop platelets in the blood from sticking together. The doctors described two trials involving a total of nearly 5,000 patients in the United States and Canada. Both found that ReoPro greatly reduced complications from the surgery. The trials found a 60 percent reduction in deaths among patients who had suffered from acute heart attacks or angina (chest pain) when they had angioplasty. "One month after treatment, overall death, recurrent heart attacks and urgent repeat angioplasty or bypass surgery were reduced by up to 59 percent in all patients who were treated with...ReoPro," Duke University said in a statement. "These findings are highly promising; a new way to make angioplasty a safer and more lasting treatment for heart disease," said Dr Eric Topol, who helped coordinate the study. Interim findings from the studies have been published in the New England Journal of Medicine and the Lancet medical journal, but the final results were being presented for the first time to 16,000 delegates at the European Society of Cardiology meeting in Birmingham. ReoPro, manufactured by Centocor Inc of Malvern, Pennsylvania, is marketed by Eli Lilly and Co. 3572 !GCAT These are some of the leading stories in two London-based Arabic-language newspapers on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AL-HAYAT - Saudi Basic Industries Corp says studies continue to expand the Saudi Yanbu Petrochemical Company. ASHARQ AL-AWSAT - Eritrean foreign minister says his country does not rule out Yemeni military attack to control disputed Hanish island. - Doctors end strike in Khartoum, demonstrations continue in Sudan. - Syria to start linking power grid with Jordan and Turkey in 1997 as part of a proposed plan to link the three countries together with Egypt and Iraq. 3573 !GCAT !GPOL !GVOTE The leader of the South Island's main Maori tribe, Ngai Tahu, said on Monday he was only "cautiously confident" of a settlement of the tribe's claim before the October 12 election. Ngai Tahu's chief negotiator, Sir Tipene O'Regan, told Reuters the main stumbling block was the "fixation" of some on the government's side with the idea of extinguishing customary rights. "There are some deep issues at stake including the fixation some officials have with the extinguishment of customary rights including mahinga kai (rights to food). The Crown Law office is essentially running the same arguments as (eighteenth century) Governor Grey," O'Regan said. The government has set aside $1 billion over 10 years in its so-called "fiscal envelope" for settling claims. A major slice of the available funds has already been committed to a settlement with Tainui Maori in the centre of the North Island ($170 million) and a settlement of fishing claims. The cost of a deal with Ngai Tahu is expected to rival the Tainui one, but O'Regan would not comment on media reports suggesting a deal around $170 million was possible. Government sources said Prime Minister Jim Bolger's office was behind the push for a settlement before the election to replicate the widespread kudos the government got for settling with Tainui. The sources said Bolger had taken over the leading role from Treaty Negotiations Minister Doug Graham. O'Regan said "the situation has some promise of a settlement" which would also end a three-pronged court case the tribe has taken against the Crown. The case is due to be heard on December 12 after the High Court declined a Ngai Tahu request for it to be adjourned without a hearing date pending the outcome of negotiations. The case includes an attempt to push the Waitangi Tribunal -- which has powers to make binding rulings over some claims -- into hearing a Ngai Tahu claim over forestry land and rentals. If the tribunal hears the claim and it is successful, Ngai Tahu stand to gain more than $100 million which the Crown argues should be included as part of the final settlement, but which Ngai Tahu want treated separately. Ngai Tahu, like other Maori claimants, have not recognised the fiscal envelope. "We are negotiating as if the fiscal envelope is the Crown's business. It is not part of our thinking," O'Regan said. The Ngai Tahu has set up business structures to manage assets acquired through the claims process and has earmarked the Crown's major South Island infrastructural assets. These include the assets of the two state-owned electricity generators, ECNZ and Contact Energy, as well as number of regional utilities. "We are ensuring we are not locked out of regional infrastructures. We don't want to be paid off with nominal amounts," O'Regan said. He said the Crown negotiators were "cautiously open" to Ngai Tahu claims over assets with cultural significance such as the country's tallest mountain, Mount Cook. -- Wellington newsroom 64 4 473-4746 3574 !C42 !CCAT !E41 !ECAT !GCAT !GJOB New Zealand air traffic controllers plan to strike for three hours on September 9 and Airways Corp will suspend them for 20 hours, the Airways Corp said on Monday. Airways Corp said it would implement a contingency plan approved by the Civil Aviation Authority and would suspend controllers from 10 a.m. to 6 a.m. the following day. The plan is the same as that followed during similar industrial action taken last December. During that strike, all international flights operated normally and around 60 percent of domestic flights. Airways Corp said the Airline Pilots Industrial Association planned the action in June "and have no real intention of reaching a settlement". Union spokesmen were unavailable to comment. Airways Corp said it was offering a three percent rise in base salaries plus 3.5-5 percent of salaries in a lump sum, plus an additional $3,000 to international airspace controllers. -- Wellington newsroom 64 4 4734 746 3575 !E12 !ECAT !GCAT !GPOL The Christian Coalition is backing the government's key policies, saying on Monday it was committed to responsible fiscal management and a low tax, low inflation economy, the New Zealand Press Association reported. The coalition launched an economic policy supporting the Reserve Bank Act and its 0-2 percent inflation target, the Fiscal Responsibility Act and the broad thrust of the Employment Contracts Act. It wants to continue repaying debt, encourage saving and link economic progress with values such as honesty, thrift and commitment in human relationships. The coalition's economic spokesman, Ewen McQueen, said welfare benefits would not be cut and the long-term causes of poverty would be addressed. Citing the $1.3 billion paid out in support to single parent families each year he said: "We have a problem with a lack of fathers -- that is what we are actually paying for. "It's a bit surprising the government has no strategies to handle family breakdown." He said the coalition was committed to a comprehensive package of policies aimed at promoting values which strengthened families and encouraged socially responsible behaviour. "We are confident that in the long term, these policies will also have a significant economic payback." The coalition is an alliance of the Christian Democrats and the Christian Heritage parties. It is a potential coalition partner for National, and is polling better than any other minor party. One recent poll gave it more than five percent of the party vote, which would give it seats in the next Parliament. McQueen said the coalition's long-term vision was for a low tax, low inflation economy in which individuals and families were treated as the best stewards of their own resources. Speaking at the launch, coalition co-leader Graham Capill agreed the policies were different to those promoted by some churches which want significant increases in benefits. "Our policies as a whole are aimed at relieving poverty, but we also have to be responsible to future generations," he said. "It is not responsible to burden them with more debt." Tied to the economic announcement is the coalition's agriculture and rural policy, also launched today. Agriculture spokesman Grant Bradfield said the coalition would promote policies that encouraged profitable primary industries. "Government alone has the ability to deal with inflation at its source, and has been guilty of leaving it all to the Reserve Bank which can only apply economic pressures across the board." He said the coalition did not oppose foreign investment but was worried about the sale of rural land. "We need more control over what happens to our land," he said. "There is widespread concern in rural communities, particularly about large areas of rural land." "There is very little in the way of specific criteria covering land sales, and we need specific criteria." Key points of the policies are: Economy: * seek a low tax/low inflation economy with minimal government intervention. * endorse the Fiscal Responsibility Act and control government spending. * aim to reduce public debt to zero as soon as possible with further tax cuts beyond those already announced to be considered only after that goal is achieved. * abolish the surtax on national superannuation. * make private health care and superannuation contributions tax deductible. * endorse the Reserve Bank Act and the 0-2 percent inflation target. * support the broad thrust of the Employment Contracts Act but review it to ensure the rights and responsibilities of employers and employees are fairly balanced. * reduce the costs of social breakdown by promoting values that strengthen families. * oppose the sale of state assets fundamental to the lives of New Zealanders. * work for a tax system that is equitable, easy to administer and less burdensome for families. * substantially increase rebates for charitable donations. Agriculture and rural: * promote policies that encourage primary industries, such as low inflation, low interest rates and a stable dollar. * support the right of primary producers to decide the role of producer boards. * tighten the criteria for foreign ownership of rural land. * ensure that funding for social services like health and education reflect the needs of rural communities. * ensure industry structures are elected fairly and are accountable to producers. * amend the Resource Management Act to ensure the Crown has the same legal obligations for pest control as private land owners. * support amendments to the Health and Safety Act to ensure property owners are not liable for accidents on their land to people not directly employed by them. -- Wellington newsroom 64 4 4734 746 3576 !C33 !C331 !CCAT !GCAT !GDEF !GDIP China demanded on Monday that the United States cancel plans to sell Stinger missiles, launchers and other weapons to Taiwan to prevent "new damage" to Sino-U.S. relations. "We ask the U.S. side...to cancel plans to sell missiles to Taiwan to prevent creating new damage to Sino-U.S. relations," a Foreign Ministry spokesman told Reuters. Beijing has regarded Taiwan as a renegade province since the end of a 1949 civil war and has been opposed to any country selling weapons to the island. The United States should take Sino-U.S. relations into account and live up to its promise regarding selling weapons to Taiwan, the spokesman said without elaborating. Washington has agreed to reduce weapons sales to Taiwan. Rejecting a similar demand by China on August 15, the U.S. Defence Department notified Congress last Friday of plans to sell Stinger missiles, launchers and other weapons to Taiwan. U.S. officials said the weapons were defensive and the sale would not affect the basic military balance in the region. The Pentagon said Taiwan wanted to buy 1,299 Stinger missiles, 74 guided missile launchers, 74 flight trainer Stinger missiles, 96 jeep-like Humvee vehicles and 500 rounds of .50 calibre ammunition for an estimated $420 million. The principal contractors are the Hughes Missile Systems Co., Boeing Missile and Space Systems Co. and AM General. Such sales must be made through the U.S. Defence Department, not directly by contractors, and Congress must be notified in case it wants to veto the sale. 3577 !E51 !E512 !ECAT !GCAT !GDIP Indonesia's President Suharto discussed the potential for importing Argentine commodities such as wheat, corn and soybeans during talks with President Carlos Menem on Monday, State Secretary Murdiono said. Menem arrived from Malaysia for a one-day visit. He was leaving for Argentina later on Monday. "Both leaders agreed that each country had big potential to expand economic cooperation and trade," Murdiono told reporters after the meeting. "There is a need to introduce exchanges between government officials and the private sectors of both sides," he added. "Argentina is producing large quantities of wheat, corn and soybeans. As you know, Indonesia currently imports a lot of those commodities. We can utilise Argentine potential in those commodities," Murdiono said. He said Indonesia would study the possibility of a counter-trade agreement with Argentina. Murdiono said Suharto had also told Foreign Minister Ali Alatas and Trade and Industry Minister Tunky Ariwibowo to study how to increase air links between Indonesia and Argentina. 3578 !GCAT Newspaper headlines CHINA TIMES - Six people die at a high school riverside outing in Taipei county. Japan's Yomiuri newspaper says Beijing plans to hold military exercise in southeast China in October. UNITED DAILY NEWS - Six people die at a high school riverside outing. Financial institutes will lower rates this week after the central bank cut banks' reserve requirements. COMMERCIAL TIMES - China will increse the number of Chinese ports for direct shipping links with Taiwan if Taiwan responds to Beijing's rules for direct shipping links issued last week. Legislator Vincent Siew, former Mainland Affairs Council chairman, visited Hong Kong in mid-August. ECONOMIC DAILY NEWS - The investment ratio hits a nine-year low. The saving ratio also falls. There are signs of China-funded firms getting involved in the shipping business across the Taiwan Strait. -- Taipei Newsroom (2-5080815) 3579 !GCAT Following is a summary of major Indonesian political and business stories in leading newspapers, prepared by Reuters in Jakarta. Reuters has not checked the stories and does not guarantee their accuracy. Telephone: (6221) 384-6364. Fax: (6221) 344-8404. - - - - KOMPAS Four Indonesian sailors were among 12 people killed in a mutiny by Chinese crewmembers on a fishing boat in the South Pacific. - - - - JAKARTA POST An attempt to reach an out-of-court settlement to the dispute between warring factions in the Indonesian Democratic Party (PDI) and the government is still deadlocked. The PDI's ousted leader Megawati Sukarnoputri is suing the government and the military for backing a rebel congress in June in which she was deposed as party chairman. President Suharto has asked dairy farmers to take care of their cattle and not sell their land. Suharto was speaking on a tour of a pilot project in Bogor, west Java. - - - - INDONESIAN OBSERVER Police chief Lieutenant-General Sudibyo Widodo said the number of suspects allegedly connected with fradulent central bank transfers worth 6.6 billion rupiah could be more than five. - - - - HARIAN EKONOMI NERACA The National Logistic Agency (Bulog) plans to import cooking oil following the decline in the production of crude palm oil (CPO). 3580 !GCAT DAY'S TOP STORIES - President Fidel Ramos has expressed optimism that the final round of peace talks with the Moro National Liberation Front will be concluded this week in Jakarta without any hitches. (THE PHILIPPINE STAR) - Three unidentified men reportedly kidnapped four Chinese children and their Filipino driver on Sunday afternoon in San Juan, a residential area in Manila. (PHILIPPINE STAR) - Rolando Andaya, Chairman of the House Committee on Appropriations says the implending integration of Moro National Liberation Front fighters into the Armed Forces could demoralize the army unless there is a clear policy on the ranks and assignments of the former rebels. (TODAY) - The Philippine honorary consul general to Jordan has been summoned to testify on the death of Filipina housemaid Elisa Salem in Amman before the House Joint Committee on Women, Labour and Foreign Affairs. (TODAY) - President Ramos has invited the head of the Organization of Islamic Conference to witness the signing of the peace agreement between the Philippine government and the Moro National Liberation Front in Jakarta on Friday. (THE MANILA CHRONICLE) - The government will try for a budget surplus of 14.7 billion pesos for 1997 to offset the huge deficit in public sector accounts, Budget and Management Secretary Salvador Enriquez said. (THE MANILA CHRONICLE) - Defence Secretary Renato de Villa said the extremist Abu Sayyaf will not join other Muslim armed groups in Mindanao in talking peace with the government and will remain "a thorn in our side" even with the establishment of the transitional Southern Philippines Council for Peace and Development. (THE PHILIPPINE JOURNAL) - The Senate Finance Committee led by Senator Ernesto Maceda will start deliberations on the proposed 1997 national government budget on Monday by summoning the Development Budget Coordination Committee. (THE PHILIPPINE JOURNAL) ++++ BUSINESS - The House Committee on Energy will push for a rollback in the pump prices of gasoline products to pre-August 14 levels if it is able to establish alleged "flaws" in the newly-introduced automatic oil pricing formula. (MALAYA) - The Philippine Stock Exchange has deferred its verdict on the proposed 7.9 billion peso initial public offering of Digital Telecommunications, a source said. (THE BUSINESS DAILY) - A compromise bill on the liberalisation of the country's retail trade is shaping up in the Senate. The compromise will address concerns of local retailers as well as open a window for the entry of foreign retailers. (MANILA BULLETIN) - Leading cellular phone operator Pilipino Telecommunications Corp (Piltel) is projecting a 74 percent compounded annual growth rate in net revenues over the next five years, Piltel vice president for marketing Debbie Ong said. (THE MANILA CHRONICLE) - Manila newsroom (632) 841 8934 3581 !GCAT !GPOL Thai Prime Minister Banharn Silpa-archa on Monday proposed September 18 as the date for parliamentary debate on an opposition no-confidence motion accusing him of incompetence. The president of parliament had earlier said September 11 could be set for the debate. The opposition motion against Banharn accuses him of being incompetent, lacking ethical leadership and alleges his administration is corrupt. His critics allege he may be attempting to delay the debate. Banharn has denied the accusations and said he is ready to clear himself in parliament. "In my opinion September 18 would be a convenient date for the government to answer questions. This has nothing to do with the accusation that I am trying to escape the debate," Banharn told reporters after meeting coalition partners. Banharn's 13-month-old, six-party coalition government controls 209 seats in the 391-seat lower house of parliament. Political infighting within Banharn's Chart Thai party has raised doubts whether he can hold his supporters together and defeat the opposition motion, political analysts said. "We are still waiting to fix a date. September 18 is regarded as tentative because we still have not received the order to fix it on the agenda," said an official at parliament's agenda section. The last no-confidence debate against Banharn's coalition in May was won by the government. 3582 !GCAT !GCRIM !GPRO Kim Woo-choong, the founder and chairman of South Korea's powerful Daewoo Group, will appeal a two year jail sentence imposed by a Seoul court on Monday for bribing former president Roh Tae-woo, a group spokesman said. "It's inevitable the sentence will be appealed. Otherwise, Kim will be put into jail," the spokesman said. He said the group was worried about the knock-on effect of the sentence on the South Korean economy. Daewoo is one of the country's top-four conglomerates. "There are worries that the sentence might have negative impact on the business activities of Korean firms," he said. 3583 !E51 !ECAT !GCAT !GDIP Indonesia's President Suharto discussed the potential for importing Argentine commodities such as wheat, corn and soybeans during talks with President Carlos Menem on Monday, State Secretary Murdiono said. Menem arrived from Malaysia for a one-day visit. He was leaving for Argentina later on Monday. "Both leaders agreed that each country had big potential to expand economic cooperation and trade," Murdiono told reporters after the meeting. "There is a need to introduce exchanges between government officials and the private sectors of both sides," he added. "Argentina is producing large quantities of wheat, corn and soybeans. As you know, Indonesia currently imports a lot of those commodities. We can utilise Argentine potential in those commodities," Murdiono said. He said Indonesia would study the possibility of a counter-trade agreement with Argentina. Murdiono said Suharto had also told Foreign Minister Ali Alatas and Trade and Industry Minister Tunky Ariwibowo to study how to increase air links between Indonesia and Argentina. 3584 !GCAT !GCRIM !GPOL The honorary chairman of South Korea's Hanbo group, Chung Tae-soo, was sentenced to two years in jail on Monday after being convicted by a Seoul court of bribing former president Roh Tae-woo. The chairman of the Jinro group, Chang Jin-ho, was sentenced to two years, according to a statement from the Seoul District Criminal Court. It said the head of the Dongbu group, Kim Joon-ki, received a 1-1/2 year jail sentence suspended for two years, the head of the Daelim group, Lee Joon-yong, was sentenced to 1-1/2 years suspended for three years. The former head of Daewoo Corp, Lee Kyung-hoon, was sentenced to 10 months in prison suspended for two years. The head of unlisted Daeho Construction, Lee Kun, got 1-1/2 years suspended for three years. 3585 !GCAT !GDEF China's People's Liberation Army (PLA) will hold major military drills involving 100,000 "rapid response" troops across southern China in October and November, a Japanese newspaper reported. The drills will be to prepare crack PLA units from five of China's seven military regions for emergencies in areas including, but not limited, to the Taiwan Strait, the Yomiuri Shimbun said in report from Hong Kong in its Sunday edition. The daily said that unlike war games China held in March during Taiwan's presidential campaign, the PLA's autumn exercise would not include missile firings or mock attempts to capture Taiwanese-held islands. The report, citing "multiple Chinese military sources", said PLA officials believed exercises confined to China's mainland would not draw international criticism or intervention by the United States. China's war games last March near Taiwan, which Beijing has considered a rebel province since 1949 and has vowed to invade if it seeks independence, drew strong international rebuke and prompted the United States to assemble its largest naval armada in Asia since the Vietnam War. The newspaper said a conflict on the Korean peninsula was among the contingencies the Chinese exercises would prepare for. 3586 !GCAT !GCRIM !GPOL Lawyers are still discussing a possible out of court settlement of a case filed by Megawati Sukarnoputri following her ouster as leader of the opposition Indonesian Democratic Party (PDI), a lawyer said on Monday. But he was not optimistic an agreement could be reached. "There have been...differences from both parties. The suit will not be dropped if there is no settlement, but we are going to meet again tomorrow (Tuesday)," the lawyer, R.O. Tambunan, told Reuters. Central Jakarta District Court chief judge I Gde Ketut Suarta last Thursday adjourned Megawati's multi-billion dollar case against the government, military and party rivals to allow both sides to discuss a settlement. The hearing is due to resume on Thursday. Megawati has sued deputy parliamentary speaker Surjadi, Interior Minister Yogie Suardi Memet, armed forces chief General Feisal Tanjung and national police chief Lieutenant-General Dibyo Widodo over the government-funded congress in the north Sumatran city of Medan at which she was removed from her post in June. Tambunan declined to comment when asked if an out-of-court settlement would mean the Medan congress should be declared invalid. "I wish not to make any comment. We are going to continue our efforts tommorow and we will later tell the judge if there is an agreement. But there are many differences (between both parties)," he said. Megawati, eldest daughter of Indonesia's late founding president Sukarno, has asked the court to declare the Medan congress illegal and pay 51 trillion rupiah ($22 billion) in damages. Megawati said last Friday she was still keen to pursue the case. She has been at the centre of a political storm since her removal from the PDI's top post, to which she was elected in 1993 for a five-year term. Political analysts have said the government feared her vote-drawing power ahead of general elections in mid-1997 and a presidential vote the following year. The worst riots in two decades in Jakarta broke out on July 27 after police cleared the PDI headquarters of her supporters. At least four people died and a number of buildings and vehicles were set on fire. 3587 !GCAT !GPOL District authorities in central Vietnam said on Monday they had punished nearly 800 local communist party members over the past five years for violating family planning guidelines. Nguyen Xuan Thuy of the Ky Anh family planning committee said 74 key officials had been dismissed from their posts, 247 thrown out of the party altogether and hundreds of others issued with warnings over having too many children. He said 143 party members had voluntarilly given up their membership for failing to comply with official guidelines that limit the model Vietnamese family to two children. "The good news is that the number of party members contributing to the population rise is showing a tendency to decline," he said by phone. Vietnam's population, estimated at around 75 million people, is growing rapidly at around 2.2 percent each year. Ky Anh lies in Ha Tinh province, some 350 km (220 miles) south of Hanoi. The area is one of the country's poorest. 3588 !C24 !CCAT !GCAT !GENV Tokyo Electric Power Co Inc (TEPCO) said on Monday it had halted the test run of the world's first advanced boiling water reactor on Sunday after iodine levels in coolant indicated possible radiation leakage. Levels of radioactive iodine 131 started increasing on August 20, and reached 20 Becquerels (Bq) per gramme of coolant on Saturday, a TEPCO spokesman said. TEPCO shut down the reactor at its Kashiwazaki Kariba complex on the Japan Sea coast although the iodine levels were far below the government-set maximum allowable level of 1,300 Bq per gramme, he said. The cause of the increase in iodine levels was yet to be determined, but no radiation leaked outside the plant, he said. The start of commercial operations of the 1.36 million kilowatt reactor, originally scheduled on September 11, would be delayed by one month or more because of the shutdown, he added. 3589 !C12 !C15 !C152 !CCAT !GCAT !GCRIM All nine listed shares in the Daewoo Group fell in weak afternoon trading ahead of the sentencing of the group chairman by a Seoul court on bribery charges, brokers said on Monday. Daewoo Corp lost 100 won to 7,300 in early afternoon trading with only 55,870 shares changing hands. Daewoo Precision shed 120 won to 8,370 and Daewoo Telecom slipped 150 won to 8,650. A Seoul District Court is expected to sentence Kim Woo-choong, founder and chairman of the Daewoo Group, on charges of bribing former President Roh Tae-woo with 15 billion won. "Even though investors don't expect the court to sentence Kim to a prison term, they're still selling their Daewoo holdings before the sentencing," said an LG Securities broker. State prosecutors have demanded four years in prison for Kim. The court has already sentenced former president Chun Doo Hwan to death on charges related to a 1979 coup and an army massacre of pro-democracy demonstrators the following year. His presidential successor, Roh, was sentenced to 22-1/2 years in prison on similar charges of masterminding the putsch that thrust Chun to power and of attempted murder of superior officers. Both were found guilty of taking bribes. Chun was fined 225.9 billion won ($276 million) and Roh 283.8 billion won, equal to the amount they were convicted of pocketing. -- Seoul Newsroom (822) 727 5647 3590 !GCAT !GPOL !GPRO !GVIO The leader of a dissident Khmer Rouge faction denied involvement in genocide in Cambodia in the 1970s, and said he often disagreed with his former hardline chief Pol Pot, the Bangkok Post reported on Monday. Ieng Sary, viewed as the former number two to the Khmer Rouge's paramount leader Pol Pot, told the newspaper he was often in conflict with Pol Pot over the party line. More than one million Cambodians were executed or died of starvation, disease or overwork in camps during the Maoist organisation's reign of terror dubbed the "killing fields". The newspaper said the interview was conducted at an unidentified village on the Thai-Cambodia border Ieng Sary said he was not a mass murderer and was implicated in the genocide only because Pol Pot had appointed him as foreign minister during the Khmer Rouge's 1975-79 rule. He said his job as foreign minister kept him away from decision-making in the party but had made him an unwitting public figure of the Khmer Rouge. "At this point, one is entitled to ask this question: 'Wasn't this a tactic by Pol Pot to make his most prominent critic take all the blame for the reign of terror?'" he said. "So it seems that the mass media have made a gross mistake by giving Ieng Sary the title of 'Brother Number Two' and 'Pol Pot's right hand'," Ieng Sary said, in the first interview since he and a group of dissident Khmer Rouge split from Pol Pot this month. The French-educated Ieng Sary, now in his late 60s and a former brother-in-law of Pol Pot, is known to be in poor health. Ieng Sary, sentenced to death for his role in the Cambodian killings, heads a breakaway Khmer Rouge faction which has rejected what it calls the hardline tactics of Pol Pot and has vowed to make peace with the Phnom Penh government. The clandestine Khmer Rouge radio has attacked Ieng Sary as a traitor and called for his destruction as well as the arrest of two field commanders loyal to him in northwestern Cambodia's Pailin and Phnom Malai areas. However, Cambodia's King Norodom Sihanouk said over the weekend he supported a proposed mass amnesty to be declared on his 74th birthday on October 31, fuelling speculation that Ieng Sary may be pardoned. Cambodian co-premier Hun Sen said after the split in the Khmer Rouge became known that Ieng Sary would be pardoned. But First Prime Minister Prince Norodom Ranariddh said parliament should decide whether ex-Khmer Rouge leaders should be pardoned and the government would ask the national assembly to scrap a law banning the guerrilla group. Ieng Sary also told the newspaper a secret committee that answered only to Pol Pot was actually responsible for the atrocities. The secret committee comprised Nuon Chea, deputy secretary-general of the party, Son Sen, deputy prime minister in charge of national defence and security and Son Sen's wife Yun Yat. Ieng Sary said Nuon Chea was really "Brother Number Two" and said he had been in charge of rounding up intellectuals, diplomats and people coming back to Phnom Penh from abroad. "Soon after landing at Pochentong Airport, those victims were immediately sent to different detention centres in Phnom Penh and the provinces without the knowledge of their families or even the Foreign Ministry," he said. Ieng Sary said Pol Pot was the sole architect of the party's line, strategy and tactics and every official was responsible for the implementation of those policies. "Pol Pot's dictatorship which had been gradually taking shape since 1970, then became a full-sized and bloody dictatorship in 1975 after the liberation of Phnom Penh," he said. Vietnamese troops moved into Cambodia in late 1978 and drove the Khmer Rouge into the jungles from where they have fought a guerrilla war against the government in Phnom Penh. The Vietnamese left Cambodia in early 1989. 3591 !GCAT !GCRIM Roslan bin Mohd Sany was a 29-year-old Singaporean despatch rider whose luck ran out. One evening in November 1994, he was stopped for a spot check by police who found 18.57 grams (0.62 ounces) of heroin hidden in 28 small packets on his person. Convicted for drug trafficking after a trial, he was hanged on July 26. Three other people convicted of drug offences were executed the same day, They included a Malaysian whose car yielded 793.5 gm (26.45 oz) of heroin stashed in the boot and the windscreen wipers. Four more Singaporeans were executed the following Friday, again for violating the city-state's tough drug laws. Of the nearly 270 people hanged for various crimes in the city-state since 1975, almost half were for drug-related charges. Singapore has a mandatory death sentence for anyone over 18 years of age found guilty of trafficking in more than 15 gm (half an ounce) of heroin, 30 gm (an ounce) of morphine or 500 gm (18 oz) of cannabis or marijuana. The only Westerner hanged for drug trafficking so far was Johannes van Damme, a 59-year old Dutch engineer. His execution in 1994 drew protests from the Netherlands and human rights groups. Yet, despite the risk of a date with the hangman, drug traffickers and some addicts seem unfazed by Singapore's tough laws. "It is the thrill, this cat-and-mouse game, of trying to defy the law. You do it once and you get away with it, you will do it again and see if they (the police) will eventually get you," one addict said in a written reply to a set of questions. He refused to meet reporters and declined to give personal details about how he became an addict. The average daily population in Singapore's drug rehabilitation centres (DRCs) reached a record high of 8,700 in 1994, Ho Peng Kee, senior parliamentary secretary for Law and Home Affairs, said in a recent speech. Ho said concerted government programmes like better treatment for addicts helped trim the number of drug abusers in DRCs, although he gave no figures. "While measures taken have helped to reduce the problem of heroin abuse, new threats have emerged," Ho said. Police have carried out a series of raids on smart discotheques to round up users and dealers of the now fashionable drug Ecstasy, reputed to give the energy to dance all night. "We are now faced with so-called designer drugs such as Ecstasy which are abused by some party-goers in night spots," he said. One enterprising trafficker tried to sneak Ecstasy pills into Singapore's Changi airport by using ingeniously crafted hiding places in airconditioners. When Singapore police pried the units open after the consignee failed to turn up, they found thousands of pills. Singaporean couriers involved in the business have also increased sharply over the last few years, the Central Narcotics Bureau (CNB) said. The number of Singaporeans arrested for trafficking inside and outside the country shot up to 50 in 1995 from 34 in 1993, CNB figures showed. "The numbers have been increasing because drug trafficking is a lucrative trade," Masbollah Fazal, the CNB director, said in a written statement to Reuters. "Also, because (of) our tough stand against the drug trade, Singaporeans as a whole are less likely to be suspected of drug trafficking. This is the flip side of our tough drug stand," he added. Heroin smuggled into the country would usually be packed into straws of various lengths, ranging from an inch-and-a-half (0.6 cm) long to about one foot (4.7 cm), legal sources said. The price of the smaller packets range between Singapore $50 to over S$100 (US$35-$70), they said. Once hooked, addicts will normally try to peddle marijuana or Ecstasy pills to get more money to support their habit. One trafficker made $200,000 on one deal and retired by buying two brothels, one source said. He did not say if the man was still in Singapore. US$1-S$1.41 3592 !GCAT !GDEF !GDIP China on Monday denied a U.S. newspaper report linking it to the construction of a missile plant in Pakistan. Asked to comment on a Washington Post report that China had supplied blueprints and equipment for the plant, a foreign ministry spokeswoman said: "The U.S. newspaper report is entirely groundless." The spokeswoman had no further comment. The Washington Post reported on Sunday that U.S. intelligence officials had concluded that Pakistan was secretly building a medium-range missile factory in a suburb of the northern city of Rawalpindi, near Islamabad. The newspaper said that the development raised the prospect of a new Sino-U.S. dispute over arms proliferation. The partially completed plant was expected to be capable of producing most of the major components of a missile modeled on the Chinese designed M-11 in a year or two. Some U.S. officials believed the factory would produce precise duplicates of the missile, according to the Washington Post. The United States has twice imposed limited economic sanctions against China for selling M-11 missile launchers and finished missile components to Pakistan, but withdrew the curbs after Beijing promised to stop such deliveries. A White House spokesman said he could not confirm the story but said the United States took such reports seriously. "We do not believe it is in the best interests of the United States or of any other country to supply Pakistan with the capacity to manufacture or deploy weapons of mass destruction," the spokesman said. 3593 !GCAT !GDEF !GDIP China on Monday denied a U.S. newspaper report linking it to the construction of a missile plant in Pakistan. Asked to comment on a Washington Post report that China had supplied blueprints and equipment for the plant, a foreign ministry spokeswoman said: "The U.S. newspaper report is entirely groundless." The spokeswoman had no further comment. The Washington Post reported on Sunday that U.S. intelligence officials had concluded that Pakistan was secretly building a medium-range missile factory in a suburb of the northern city of Rawalpindi, near Islamabad. The partially completed plant was expected to be capable of producing most of the major components of a missile modelled on the Chinese designed M-11 in a year or two, the newspaper said. The United States has twice imposed limited economic sanctions against China for selling M-11 missile launchers and finished missile components to Pakistan, but withdrew the curbs after Beijing promised to stop such deliveries. 3594 !GCAT !GVIO Two South Korean students who started a hunger strike at the Korean truce village of Panmunjom last week have lost weight but are so far withstanding their ordeal, North Korean state media reported. "Their blood pressure has dropped and their weight decreased by more than two kg (four pounds) each, but they are withstanding because of their strong will," the Korean Central News Agency (KCNA) said in a report late on Sunday. KCNA, monitored in Tokyo, said Ryu Se Hong and To Jong Hwa, started their hunger strike last week on the North Korean side of the divided border town of Panmunjom to protest the arrest of South Korean students involved in pro-North demonstrations. Riot police stormed Seoul's Yonsei University last week to end a seven-day occupation by students calling for reunification with North Korea and the withdrawal of U.S. troops stationed in the South. Police arrested about 3,200 students in breaking up the protests. KCNA said the two hunger strikers held a news conference on Sunday at Panmunjom in which they denounced the South Korean authorities for their crackdown on students and urged international organisations to dispatch fact-finding groups to Seoul for "a fair settlement of the problems". On Friday, KCNA reported that North Korean and overseas Korean students had joined in the hunger strike. 3595 !C12 !CCAT !GCAT !GCRIM !GDIP Investigations into an apparent fishing boat mutiny in the South Pacific in which 12 seamen, including the captain, died, were held up on Monday by wrangling over which country had jurisdiction. The case involves Japan, which sent a coastguard vessel to the rescue, South Korea and Indonesia, whose seamen were killed and Honduras where the boat was registered. A Japanese coastguard vessel found the ship drifting without fuel near Torishima island, about 550 km (340 miles) south of Tokyo, on Sunday. But the coastguard delayed towing the ship to harbour until a decision on which country would exercise jurisdiction. "We're still in the process of negotiating with related organisations, since the Maritime Safety Agency has no authority to investigate," said a spokesman for the Japanese agency. Korean police said on Sunday that the South Korean captain of the Honduras-registered Pescarmar No. 15 and 11 crewmen were killed in an apparent mutiny in the South Pacific by Chinese crewmembers. The spokesman said Japanese coast guards, who questioned the surviving 13 crew, said Captain Choi Ki-taek, six other Koreans, four Indonesians and one Chinese-Korean perished in the mutiny as the tuna fishing vessel was sailing towards the South Pacific island of Samoa. Six Chinese-Koreans, six Indonesians and one Korean were on board the vessel when it was found, the spokesman said. Legal experts said as the incident occured in international waters, the authority to investigate would normally lie with the flag state, Honduras in this case. But the issue was complicated as the 254-gross ton ship was managed by a South Korean fishing company, Daehyun, owned by Omani interests, and the captain was South Korean (corrects identity of the owners of the ship). Japan's Foreign Ministry said negotiations among Japan, South Korea, Indonesia and Honduras have not started yet. "We are aware of the incident, but we have not entered any negotiations (with other countries) yet," said a Foreign Ministry spokesman. A spokesman for the South Korean Embassy was not available for comment. In their report of the incident, Korean police said the mutineers, ethnic Koreans from China, apparently revolted over harsh working conditions. He said all bodies were dumped overboard. Until it was found, the ship had been out of radio contact since August 3. 3596 !GCAT !GCRIM !GPOL !GVIO Disgraced former South Korean president Chun Doo Hwan and his successor Roh Tae-woo arrived in court on Monday to be sentenced on charges of mutiny, treason and corruption. Prosecutors have asked for death for Chun and life in jail for Roh for their roles in a 1979 coup that thrust Chun to power and a massacre the following year of demonstrators in Kwangju protesting against martial law. The grim-faced former generals were wearing short-sleeved prison-issued shirts and were greeted as they stepped off their jail buses by television cameras and packs of reporters. Outside the Seoul District Criminal Court, several dozen women relatives of the Kwangju victims staged a noisy demonstration in light rain to demand maximum punishment. "No mercy for the murderers," they screamed. The three-judge panel is expected to uphold the prosecution demand in sentencing, but most Koreans believe Chun and Roh will be granted a pardon before current President Kim Young-sam leaves office at the end of next year. The two have remained defiant throughout their trial, defending the coup as needed to prevent turmoil and North Korean attack following the assasination of president Park Chung-hee. 3597 !GCAT !GVIO Suspected Moslem militants shot dead four people -- including three Christians -- and wounded another when they stormed into the house of a community leader in southern Egypt, security sources said on Monday. They said gunmen burst into the house of the chief of a village in Mallawi town, about 260 km (160 miles) south of Cairo, on Sunday and opened fire. The community leader was not in the house at the time. The Interior Ministry said in a statement the incident took place in Abu Qurqas town, about 20 km (12 miles) north of Mallawi. It said three of the people killed in the attack as well as the man hurt in the shooting were Christians. Police in southern Egypt believe the gunmen belonged to the militant al-Gama'a al-Islamiya (Islamic Group), which has been fighting to overthrow the government and set up a strict Islamic state since 1992. Militants have targeted senior government officials, policemen, Christians and sometimes tourists in their anti-government campaign. About 1,000 people, mainly militants and policemen, have been killed in political violence in Egypt over the last four year. 3598 !GCAT !GDIP Yemen warned of a firm response if Eritrea failed to meet a Monday deadline to pull out troops from a disputed Red Sea island. "Today Monday is the last date for Eritrea's withdrawal from Lesser Hanish," said Yemeni President Ali Abdullah Saleh. "We shall not be emotional...If Eritrea does not pull out we shall deal with it firmly and with determination to regain our legitimate rights," he added. The president, speaking in this southern port city in a celebration marking the 110th anniversary of the Aden Chamber of Commerce, said that the United Nations and French mediator Francis Gutman had earlier assured him of Eritrea's withdrawal from the island within a specified period ending Monday. Yemen had accused its African neighbour across the Red Sea of committing a "glaring violation" on August 10 in Lesser Hanish, one of several disputed islands near the waterway's southern entrance. The U.N. Security Council on Thursday told Eritrea it should withdraw immediately from the island as it had earlier promised. At least 12 people were reported killed last December when the two countries fought briefly over the disputed islands, which lie near tanker routes. They agreed in Paris in May to settle the row through arbitration but the latest tension appears to have derailed the process. 3599 !GCAT !GCRIM Egyptian police have arrested and charged with negligence a doctor who circumcised a 14-year-old girl who later died, security sources said on Monday. They said police picked up Dr Rabie Ibrahim Mahgoub on Sunday at a friend's house where had been hiding since circumcising Amina Abdelhamid Mohammed on Saturday. Government newspapers said the girl died of haemorrhage. Amina's father, who earlier told police he took his daughter to a private hospital, now says the doctor circumcised Amina at home for a fee of 20 pounds ($6), the sources said. Female circumcision involves the removal of some or all of the external genitalia. Some human rights activists prefer to call the practice female genital mutilation for the severe form it often takes. Side effects include haemorrhage, shock and sexual dysfunction. Amina's father told police that after his daughter did not wake up from the procedure he twice went to seek the doctor's advice. The doctor told him Amina was still under the effects of the anaesthetic he had given her, the sources said. Police have released the doctor on bail of 500 pounds ($147). It is not clear when he will be tried. According to research in 1995 by a national task force made up of women and human rights activists, doctors and religious scholars, at least 80 percent of Egyptian women underwent the operation during their girlhood. Health Minister Ismail Sallam last month banned female circumcision operations at public hospitals. Some Egyptians say female circumcision is based on Islamic teaching but others say it has more traditional roots because both Moslem and Christian girls are circumcised. Women and human rights groups have urged the government to ban the practice outright. 3600 !GCAT !GPOL PLO officials said on Monday Israel had no right to demand closure of three Palestinian offices in Arab East Jerusalem but it had shut two to deprive Israel's prime minister of any excuse to slow peace moves. They rejected Israel's charge the offices were carrying out activities of the Palestinian Authority, which according to an interim peace accord is restricted to working in self-rule enclaves set up under the deal in Gaza and the West Bank. "When these offices, which they claim are Palestinian Authority offices, are closed, we will strip Israel of any false excuses to continue freezing the peace process," one official of the Palestine Liberation Organisation (PLO) said. "We expect Israel now to reopen talks and to fulfil its commitments," he said. The offices closed were the Maps and Survey Department and the Sports and Youth Office. The head of a third institution Israel had demanded be closed, a vocational school, is continuing to refuse to close his organisation. On Sunday, a spokesman for Israeli Prime Minister Benjamin Netanyahu said his office had received information on the closures and was watching the issue but declined further comment. Netanyahu has linked closure of the three offices to implementation of an agreement signed by the previous government to redeploy Israeli troops in the West Bank town of Hebron. Palestinians view the Hebron withdrawal as a litmus test of Netanyahu's intentions on Middle East peace moves and reject renegotiation of the deal. Palestinians have argued that their institutions in Jerusalem are PLO offices predating the peace deals which created the self-rule Authority and are unconnected to self-rule governmental activities. Israel captured East Jerusalem in the 1967 Middle East war and later annexed it in a move unrecognised by the international community. It has declared both halves of the city its eternal capital. Palestinians view East Jerusalem as the capital of a future state. The city's fate is up for negotiation at final peace talks which have yet to resume under Netanyahu. 3601 !GCAT These are the leading stories in the Turkish press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. SABAH - Credit card owners panicked by emergence of organised gang withdrawing money from credit card accounts of three big Turkish banks and some Greek banks. MILLIYET - The minister of justice insists on implementing a model that will forgive prisoner's punishments if they can memorise parts from the Koran. - State minister Salim Ensarioglu says in a report that people in southeast Turkey do not want to be educated in Kurdish. HURRIYET - MP from the premier Necmettin Erbakan's Welfare Party threatens to resign from the party if parliament does not lift emergency rule in the southeast, scene of a 12-year Kurdish separatist insurgency. CUMHURIYET - The guerrilla Kurdistan Workers' Party (PKK) releases seven Turkish soldiers on the border between Turkey and Iraq after taking them prisoner several months ago. YENI YUZYIL - Islamist women supporting Welfare give a new dimension to Turkish feminism and break the "passive" image of Islamist women. DUNYA - International trading Fair in Izmir opens on Monday. ZAMAN - The United States backs Ankara's project of importing natural gas from its neighbour Iran. 3602 !GCAT These are the leading stories in the Moroccan press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AL-BAYANE - Morocco on verge of major political changes with referendum on constitutional reform. - Banana production dropped as consequence of GATT accord and lack of competitiveness on local market. AL-ANBAA - Moroccan delegation heads for Libya to attend session of the executive council for African parliaments. - Morocco and Belgium seek ways to expand cooperation in telecommunications and transport. AL-ALAM - Police arrests three French nationals and seven Moroccans on drug trafficking charges in Tangier. 3603 !GCAT These are some of the leading stories in Syrian newspapers on Monday. Reuters has not verified these stories and does not vouch for their accuracy. SYRIA TIMES - The Progressive National Front leadership (ruling coalition headed by Baath party) reviews latest developments and stresses security for all on the basis of just peace in the Middle East. - Lebanese patriots destroy Israeli tank in south Lebanon. TISHREEN - Arab League says the boycott of Israel would remain as long as occupation remains. - Japanese foreign minister to meet Israeli Prime Minister Benjamin Netanyahu today. Tokyo says Israel should adhere to the Madrid principles. - Egypt gives Israel three weeks to rethink its stance on the peace process before cancelling the economic conference of the Middle East. AL-BAATH - Second journalists' conference opens in Syria. Deputy president in the ruling Baath party Suleiman Qaddah says: "We cling to achieving just and comprehensive peace. Israel cannot achieve the peace of force." - Israeli occupation forces arrest a human rights member in the Golan Heights. 3604 !GCAT These are some of the leading stories in the Kuwaiti press on Monday. Reuters has not verified these stories and does not vouch for their accuracy: AL-QABAS - Government to set reduced fees for mobile telephones and pagers on Monday. Kuwait passed a law to reduce the fees charged by the Mobile Telecommunications Company (MTC) for its services. MTC is the sole provider of mobile telecommunications in the Gulf state of 1.8 million. - Deputy Meshari al-Ausaimi drafts a request to question defence minister Sheikh Ahmad al-Hamoud al-Sabah. Ausaimi has said he plans to question Sheikh Ahmad if the government did not cooperate with a parliamentary panel probing alleged irregularities in defence ministry contracts. AL-RAI AL-AAM - Parliament's financial committee demands explanation about the state-owned Kuwait Airways Corp (KAC) losses. KAC has reported a loss of 27.9 million dinars ($93.3 million) in the 1994/95 fiscal year (June-July). AL-SEYASSAH - Parliamentary committee approves a bill that would crackdown on industrial and commercial monopoly. 3605 !GCAT These are some of the leading stories in the official Iraqi press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. JUMHOURIYA - France adopts attitudes at both official and popular levels to end sanctions on Iraq. - Canada to open commercial centre in Baghdad next week. - Greece is ready to finance projects in Iraq via deferred payment. - Turkey renews readiness to supply Iraq with foodstuffs. - Transport and communications ministry takes measures to protect environment. THAWRA - Editorial slams Iran for meddling in Kurdish affairs in northern Iraq. - Trade minister meets Canadian MP. QADISSIYA - Information minister chairs meeting held to draw up preparations for Babylon festival. 3606 !GCAT These are some of the leading stories in the Greek Cypriot newspapers on Monday. Reuters has not verified this stories and does not vouch for their accuracy. ALITHIA - Minister of Finance Christodoulou is making it clear that the military defence fund can not afford additional expenditure on new military equipment. CHARAVGHI - Cyprus Airways is closing down its offices in Berlin and Munich. Ideas for the privatisation of the airline. PHILELEFTHEROS - The U.K. envoy for the Cyprus problem Sir Haney is moving "behind the scenes" toward military talks. - The General Auditor of the republic found serious faults in the contract agreements of industrial plots. SIMERING - The U.S. expects developments in the Cyprus problem in 1997 following the begining of direct talks between Clerides and Denktash. 3607 !GCAT These are the leading stories in the Tunisian press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. LA PRESSE - English langage to be taught as of the eighth year of the primary school instead of the third year of the secondary school. LE TEMPS - International Fair opens in the northern city of Beja with the participation of 16 foreign countries. 3608 !GCAT These are some of the leading stories in the Jordanian press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. JORDAN TIMES - Prime minister presents blueprint for economic development and growth, outlines moves aimed at addressing poverty and unemployment. - Japan and Jordan share almost identical views on peace and regional issues. - Thirty-eight more detainees released in the bread riots. AL RAI - In a letter to the armed forces, security intelligence and civil defence, the king tells them "you have safeguarded national security and democracy in Jordan. - Oman's Sultan Qaboos visits the kingdom at the end of August. - King appoints Prince Talal as rapporteur of the state security council and accepts resignation of the national security affairs advisor Mustapha al-Qeissi. AD DUSTOUR - King Hussein appreciates Japan's role in support of the Jordanian economy. - King Hussein meets former prime ministers as part of activating the national dailogue. AL ASWAQ - King says the setting up of the state of institutions will be completed and Jordanians will benefit from the gains of peace. - Interior minister calls for tracking foreigners who overstay their residence in Jordan. - Crown prince says economic adjustment plan aims at social justice that includes the residents of the Palestinian refugee camps in Jordan. 3609 !GCAT !GDIP Senior United Nations arms official Rolf Ekeus left Bahrain for Baghdad on Monday for talks with Iraqi officials, a U.N. spokesman said. The spokesman said Ekeus, chairman of the United Nations Special Commission (UNSCOM), would spend two or three days in Iraq but declined to give further details. U.N. oficials have said Ekeus would hold talks with Iraqi Deputy Prime Minister Tareq Aziz and other officials as part of an agreement Iraq reached with the United Nations in June to hold higher level political talks with Ekeus. The Security Council on Friday asked Iraq to stop blocking arms inspectors search for concealed weapons or materials they believe were being shuttled around to avoid detection. Disarming Iraq of weapons of mass destruction under 1991 Gulf War ceasefire terms is a prerequisite before the lifting of crippling sanctions imposed on Iraq in 1990 for invading Kuwait. 3610 !GCAT !GDIP Syria's ruling coalition said Israel's "anti-peace and aggressive" policy was a "dangerous setback" for the peace process, official sources said on Monday. They said the central leadership of the Progressive National Front, headed by the Baath Party, said the Israeli government was trying to destroy all peace moves that had been achieved since the opening of talks in 1991 in Madrid. The official Syrian news agency SANA said the Front met on Sunday night, chaired by Vice-President Zuheir Masharqa, to discuss a report by Foreign Minister Farouq al-Shara on recent developments in the Middle East. "The leadership discussed the current position of the peace process which was a result of the anti-peace and aggressive policy adopted by the Israeli government...," SANA said. "Through this policy it tries to turn against the bases of the peace process...and return all issues to square one." Israeli Prime Minister Benjamin Netanyahu angered Arabs after his May election by saying he was not ready to relinquish lands occupied from Arabs in 1967, including the Syrian Golan Heights. "The leadership found in this Israeli policy a dangerous setback for the peace process and a destruction to all that has been achieved in this field," SANA said. "The policy of escalation, provocation and threat which the Israeli government adopts is a clear attempt to escape from the peace process and its requirements and to attack all that had been achieved during the last five years," it added. The Front said Syria was committed to peace adding that Israel's security could not be achieved but under a comprehensive peace settlement. It said Israel was "placing its security as more important than other considerations, ignoring that comprehensive and just peace is the only way that brings security...Security should be achieved to everybody and not only for one side". 3611 !GCAT These are the leading stories in the Egyptian press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AL-AHRAM - Parliament to discuss new laws to encourage investment in November. New company law aims to facilitate procedures. - Suspected militants kill four people in southern Egypt. - Senior presidential adviser Osama el-Baz meets Netanyahu's adviser Gold in Paris today. AL-AKHBAR - Public Enterprise Minister Atef Obeid: Shares in four construction companies to be offered on the stock market. - Egyptian-Saudi joint naval training in the Red Sea. AL-GOMHURIA - Foreign Minister Moussa: Halting the peace process halts all other related activities. The U.S. has been informed of our official position towards the economic summit. - Contacts with Britain to stop conference of terrorism leaders in London. AL-WAFD - Authorities arrest 43 members of the Islamic organisation Jihad. -- Cairo newsroom +20 2 578 3290/1 3612 !GCAT These are some of the leading stories in the Bahraini press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AL-AYAM - Cabinet reviews results of Oman foreign affairs minister's visit to discuss border dispute between Bahrain and Qatar over small islands in the Gulf controlled by Bahrain. - Cabinet discusses development of a gas network for new industrial area projects. AKHBAR AL-KHALEEJ - Oil officials hold talks with an international company for oil services to exploit high-grade crude oil. Bahrain, small independent oil producer, produces around 40,000 barrels per day from its own fields. - First garment factory to open in Bahrain in December. GULF DAILY NEWS - Gulf Union Insurance and Reinsurance Company reports 12 percent earning on capital invested for its first year of operation. The company was established in July 1995. 3613 !GCAT These are the leading stories in the Beirut press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AN-NAHAR -The north Lebanon elections...Almost no chance at all for any complete ticket to win altogether and the results will weaken some leaders. -The surprise...Opposition Boutros Harb scoring high in preliminary results and former prime minister Omar Karame moves backwards. -Fears of an Israeli operation causes the redistribution of Syrian troops locations in Lebanon. AS-SAFIR -Parliament Speaker Berri: The occupied south should not be used as a winning card in elections. -Prices of alimentary goods up 13.4 percent in 1996. AL-ANWAR -Christian Maronite Patriarch Sfeir: We fear a movement from democracy to dictatorship. AD-DIYAR -A cabinet minister: "Lebanon First" aims at splitting the Syrian-Lebanese peace tracks with Israel. NIDA'A AL-WATAN -Prime Minister Hariri: Elections are the beginning of a long political life which we begin with an incomplete ticket of 17 candidates. -The Lebanese Association for the Democracy of Elections cited 51 incidents of violation in the north Lebanon round. 3614 !GCAT These are some of the leading stories in Israeli newspapers on Monday. Reuters has not verified these stories and does not vouch for their accuracy. JERUSALEM POST - Syrian President Assad asks radical leader of Palestinian group Ahmed Jibril to leave Syria. - Israeli Prime Minister Netanyahu, Palestinian President Arafat meeting may follow Hebron deal. - U.S., Israel, Egypt to parley in Paris on Monday. - Government sources say Palestinian Authority has met demand to close East Jerusalem offices. - Merhav company to upgrade Turkmenistan refinery in $500 million deal. - Carmel Bank plays down bid for Mercantile. - Dun and Bradstreet says it is detecting recessionary signs in Israel. - Clal Insurance profit up 55 percent. - Koor sells 66 percent of Sefen saw mill and wood product subsidiary for $12 million. - Treasury asks banking sector to submit bids to raise $200 million via a consortium of foreign banks toward the end of the year; part of multi-annual plan to raise foreign currency. HAARETZ - Netanyahu and Arafat could meet soon. - Ultra-Orthodox Jewish newspapers campaign against High Court President Barak saying he is "dangerous enemy". - Netanyahu creates political desk in his office with branch to deal with U.S. Congress. - Netanyahu talks to Tel Aviv Mayor Milo on possibility of his becoming justice minister. - Central Bank governor expected to lower interest rate by 0.3 to 0.5 percent. - Directorship of Africa Israel okays plan to split. MAARIV - Closing of Palestinian Authority offices in Jerusalem will allow negotiations on Hebron, government sources say. YEDIOTH AHRONOTH - President Weizman says he'll meet Arafat; Netanyahu says I'll do it at appropriate time. - Signs of recession growing. - Union Bank says no need for devaluation. - Parliament finance committee meets today on stock market crisis. GLOBES - Interest rate cut of about 0.5 percent expected. - Defence News tomorrow to publish article saying Israel and U.S. dispute over next test stages of Arrow anti-missile system. 3615 !GCAT These are some of the leading stories in the United Arab Emirates press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. AL-ITTIHAD - Minister of higher education emphasises the commitment of the UAE to provide higher education for all nationals. GULF NEWS - Proposed free trade zone to be set up on an island off Abu Dhabi will cost 11 billion dirhams and is expected to develop the manufactured goods industry in the capital. - Silver prices in Dubai gained three percent to finish at $165.58 for one kg last week. - Seychelles maid stranded after her sponsor cancelled her work visa and withheld her salary. 3616 !GCAT !GVIO When the "Arab Afghans" took up arms in the rugged mountains of Afghanistan to help the mujahideen defeat Soviet troops in the 1980s, they were backed with Saudi money and American military training and arms. More than a decade later, the battle-hardened Arab Afghans with experience in the use of powerful explosives have a new war cry that is rattling their former sponsors. Over the last few years, they have been credited with carrying out deadly attacks across the Arab world along with other Arab Moslem militants seeking to overthrow pro-Western governments and replace them with radical Islamic states. But it is the hardcore Saudi Arab Afghans operating among a few hundred underground militants in Saudi Arabia that are the the most vivid reminder that those who fought in Afghanistan have a new agenda. Four such men, three of them Afghan war veterans, confessed on Saudi state television to a car bomb that killed five Americans and two Indians in Riyadh in November. Dressed in traditional red and white checkered headdresses, they said they had hoped to carry out new waves of kidnappings and assassinations against American and Saudi targets across the kingdom. The four were beheaded by the sword in a stern warning against dissent. But the political violence did not end. Late on the night of June 25, an explosives-laden fuel truck pulled up to a military complex housing U.S. airmen in al-Khobar, eastern Saudi Arabia. Minutes later, a devastating explosion killed 19 Americans, wounded nearly 400 others and shook Saudi Arabia, the world's largest oil producer and linchpin of U.S. foreign policy in the Arab world. Saudi authorities have not announced any motives or who could have been behind the attack. But Saudi analysts and Western diplomats say Arab Afghans are likely at the top of the suspect list. "It's very likely that at least some of the bombers had fought in Afghanistan with the Mujahideen," said a Saudi expert on militant movements who has interviewed Arab Afghans. "The people who probably carried out the bombing have a few things in common such as hatred of the American presence and similar experiences in Afghanistan," added a Western diplomat who closely follows events in the kingdom. During the Cold War, the CIA and the Saudis turned a blind eye to the radical ideology of the militants to form an alliance of convenience with the mujahideen and their bearded Arab comrades to fight the Soviet threat. But the same men who fought the forces of the former Soviet Union returned to the region with a new vengeance. Some joined militant movements that waged violent campaigns to topple Arab governments and evict their Western allies. In Saudi Arabia, Moslem militants operate in loose networks linked mainly by their fierce opposition to the ruling al-Saud family and its American allies. "These people are small in number but big in action. But they don't publicise their views. They are secretive because of the situation in Saudi Arabia," said the Saudi expert. "They reject foreign influence, both culturally and politically. They are as much against a U.S. military presence as they are a Barbie doll," he added. The Saudi expert estimated about 2,000 Saudis fought in Afghanistan for periods varying from one week to three years, saying some of the money that was channeled to the mujahideen also fell into the hands of the Arab Afghans. "Many of them came back to their homes. They work in the advertising sector and own businesses," said the expert. "Others mixed a rigid understanding of Islam with Jihad (Holy Struggle). Dissent varies in the kingdom. Some people just attack corruption and others such as the Arab Afghans see the government as illegitimate and take action," he said. A Saudi analyst described the Arab Afghans in the kingdom as "uneducated, frustrated young men who have no avenue of expression". The four Riyadh bombers said in their televised confessions that they were influenced by Islamic groups outside the kingdom, including London-based dissident Mohammed al-Masari and Saudi-born Osama bin Laden, paymaster for the mujahideen during the war. Masari has denied influencing the bombers. The U.S. State Department said in a report this month that bin-Laden "is one of the most significant financial sponsors of Islamic extremist activities in the world today". The men who headed to the front in Afghanistan were influenced by fiery Islamic clerics who delivered their sermons in what were known as guest houses in neighbouring Pakistan. "Afghanistan provided a very good atmosphere for radicalism. Now we have them in Saudi Arabia," said the Saudi expert. 3617 !GCAT Headlines from major national newspapers. Reuters has not verified these stories and does not vouch for their accuracy. EL PAIS - Basque nationalist party PNV guarantees Prime Minister Jose Maria Aznar of its support despite GAL scandal EL MUNDO - Hooded youths burn a neighbour who tried to stop their vandalism DIARIO 16 - Justice minister backs measure to make judges turned politicians wait three years before returning to their posts ABC - Former Prime Minister Felipe Gonzalez could be called by the Supreme Court as a witness CINCO DIAS - Tell me why the state's salary costs are rocketing EXPANSION - El Corte Ingles emerges proudly from its most decisive year GACETA DE LOS NEGOCIOS - Galerias effect doubled El Corte Ingles's investment costs 3618 !GCAT Following are some of the leading stories in Norwegian papers this morning: AFTENPOSTEN - Five Swedish students were rescued after being trapped for 17 hours on a glacier at Jotunheim. - Insurance company Zurich Forsikring, one of the big foreign players on the Norwegian insurance market, has grown 40 percent every year since 1992 and is now looking for takeovers. - At Interpol's general conference in October Norway will propose to improve cross-border cooperation in investigations of sexual abuse of children. DAGENS NAERINGSLIV - Two Britons working in the North Sea offshore oil industry have been detained on suspicion of corruption involving Norway's state-owned company Statoil. One of them, a Statoil employee, admits to having received money from the other suspect, but insists they were not bribes, his lawyer says. - Wilhelmsen Lines is resuming regular shipping to China after 25 years. 3619 !GCAT These are the leading stories in the Maltese press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. THE TIMES - Visitors slam bus and taxi drivers for cheating. Tourists interviewed in Malta complain about over-charging. IN-NAZZJON - Government considering measures for better road discipline. Malta, with a population of 365,000, has 195,000 registered vehicles, with 80,000 new cars having been introduced on the congested roads in 10 years. - Five people arrested in Romania after drugs container found in Malta. The container, with 7.5 tonnes of cannabis, was found in Malta Freeport in transit from Singapore to Romania. L-ORIZZONT - Opposition leader Alfred Sant on steep rise in taxes over 10 years. He reiterates promise that a future Labour government will remove VAT. 3620 !GCAT These are the leading stories in the Algerian press on Monday as reported by the official Algerian news agency APS. Reuters has not verified these stories and does not vouch for their accuracy. AL CHAAB - Joint committees on national dialogue have succeeded in forging a consensus pending a national conference in the next days. EL MOUDJAHID - The Social and Economic National Council (CNES) ended two-day meeting to chart plans over population and industry. AS SALAM - The next national conference between the authorities and political parties aims to end political adventurism in Algeria. L'OPINION - Fourteen percent of Algerians hold half of the country's wealth, according to official figures. 3621 !GCAT The following are leading domestic stories in Portuguese newspapers. DIARIO ECONOMICO - The government is studying the creation of a special system of tax breaks to attract companies to invest in disadvantaged regions, sources close to the government told the paper. - The price offered by Banco Portugues de Investimento (BPI) in its successful bid for Banco de Fomento e Exterior may be known on Wednesday. - Cement company Cimpor posted a 11.6 billion escudo profit in the first half of 1996, up 13.7 percent from the same period in 1995. - French retailer Carrefour is to build another hypermarket near Lisbon. Construction will start in September. - Barclays will close two of its branches in Portugal by the end of August. DIARIO DE NOTICIAS - The leader of the centre-right Social Democratic Party (PSD) Marcelo Rebelo de Sousa is willing to set up a coalition with the right-wing Popular Party (PP) to fight local elections. - Portuguese electricity company EDP, which is slated for privatisation, is to set up a hotel chain next year using properties it owns around the country. PUBLICO - Sources involved in the privatisation of Banco de Fomento e Exterior (BFE) have criticised the Bank of Portugal for not raising objections to two bids which the Finance Ministry later rejected. --Lisbon bureau 3511-3538254 3622 !GCAT !GHEA !GODD Vienna's education authority is planning a weigh-in for school children and their satchels in an effort to correct bad posture, Austrian news agency APA reported on Monday. Inspectors will target five schools when term starts at the beginning of September and weigh a sample of children with and without their satchels. "We want to raise awareness that heavy school bags are not essential...It's not a tragedy if a child forgets an atlas or has to endure a music lesson without a song book," education authority representative Gerhard Rudy said. According to education authority guidelines school satchels should not exceed one tenth of a pupil's body weight, otherwise damage to posture could result. Almost 30 percent of Austrian sixth formers have bad posture, government statistics show. 3623 !GCAT Following are some of the leading stories in the Swedish papers this morning. Reuters has not verified these stories and does not vouch for their accuracy. DAGENS NYHETER - The ruling Social Democrat Party's (SDP) women's association is demanding that only women be appointed to posts as heads in the public sector until the year 2000, following a series of fraud cases involving male officials. SVENSKA DAGBLADET - The scale of fraud among Swedish public sector officials is very small compared to similar misdeeds in the private sector, according to Sweden's tax authority. - Volvo is to launch its luxury car model, C70, at the end of this year. The car will be a direct challenge to the German luxury car manufacturers Mercedes-Benz and BMW. - Sweden's state liquor retail monopoly is to launch a computer programme detailing the range of beer, wines and spirits available in the country's state-run stores. - Contrary to expectations, Sweden's electronics producers will be hard pressed to compete with large foreign digital TV producers as the industry takes off, according to development and technology institute Nutek. DAGENS INDUSTRI - Stena Line's half-year report, due to be published on Wednesday, will draw attention to serious problems associated the ferry company's new high speed catamaran ferry series. - The Swedish forestry industry, which has so far this year been hit by falling prices and lower demand, is likely to enjoy price rises this autumn. - Sales of charter holidays for this winter reached a record high this August, according to the Ving charter consortium. -- Paul de Bendern, Stockholm newsroom +46-8-700 1003 3624 !GCAT Following are some of the top headlines in leading Italian newspapers. ----------- TOP POLITICAL STORIES * The European Commission in Brussels says no to deputy Prime minister Walter Veltroni, who had proposed to revise Maastricht Treaty's criteria for joining the single European currency. "The schedule is realistic and must be mantained" (all). * Freedom Alliance leader Silvio Berlusconi agrees with Veltroni's proposal but says Deputy Prime minister is joining the debate late: "I said the same things two years ago" (all). In an interview Defense minister Beniamino Andreatta says "It would be foolish to ask for a delay" (La Repubblica). * Deputy Police chief Gianni De Gennaro says that behind former mafia boss Giovanni Brusca's decision to cooperate with magistrates, there might be a "terrorist strategy against the State". "He might prove his sincerity by delivering fortunes and members of his clan" (all). * Christian Democrat Senator and former Prime minister Giulio Andreotti says in an interview that his trial for association with the mafia has been "built up". "Palermo's mayor Leoluca Orlando insisted on my indictment" (Il Giornale). * Freedom Alliance leader Silvio Berlusconi, speaking of recent debate over potential conflict within the alliance, says: "Everyone is free to go where they want". ------------- TOP BUSINESS STORIES * This week the government starts a "tour de force" to define his strategy for the economy, ahead of the 1997 budget (Il Sole 24 Ore). * Trade Union leader Sergio Cofferati says government should not cut retirement funds to reduce Italy's public debt (La Stampa). -------------- Reuters has not verified these stories and cannot vouch for their accuracy. -- Milan bureau +39266129450 3625 !E12 !ECAT !G15 !G151 !G154 !GCAT Italian Prime minister Romano Prodi on Monday was quoted as saying he had no intention of seeking changes in the criteria established by the Maastricht Treaty for European Economic and Monetary Union (EMU). "We can't ask for a revision of the Maastricht criteria. Italy cannot and does not want to do it," Rome's La Repubblica newspaper quoted him as saying. "We can't and don't want to for a very simple reason -- our (1997) budget...is a message the markets need, the message they have to receive so that interest rates fall," he said. Prodi spoke a day after his deputy prime minister, Walter Veltroni, said Italy and other European countries should consider the possibility of re-thinking the criteria. His comments prompted a lively debate in Monday's newspapers, with most politicians saying Italy had to stay on track for EMU, with the single European currency due to be introduced in 1999. Veltroni told the Corriere della Sera newspaper Italy should not take any unilateral moves to delay joining the single currency, but added that a recession in Europe had made the task of meeting criteria harder for a number of countries. In his interview, Veltroni, a member of the ex-communist Democratic Party of the Left (PDS) -- the largest component in the centre-left coalition -- said countries were having difficulties with unemployment. "We must see if it might not be the right thing to sit around a table to rediscuss the criteria or their interpretation or maybe even the timing of monetary union," Veltroni said. Under the Maastricht Treaty on European integration, governments must bring their 1997 budget deficits close to three percent of total output and put their outstanding debt levels on a sustainable path towards 60 percent of GDP. Prodi had already said earlier this month that Italy would be following the Maastricht criteria and was not worried if Italy enters a bit late. 3626 !GCAT Here are the highlights of stories in the Danish press on Monday. Reuters has not verified these stories and does not vouch for their accuracy. BERLINGSKE TIDENDE --- Prime minister Poul Nyrup pledges that the early retirement system will not be changed as long as his Social Democrats form the Danish government. This comes after stormy debate on the issue in the Danish parliament. --- The Danish branch of the international human rights organisation Amnesty International wants foreign minister Niels Helveg Petersen to raise the subjects of maltreatment of children in Chinese children's home, prisoners of conscience and torture, during his visit to China next month. --- Danish consulting engineers Carl Bro Int. have won a 300,000 Ecu contract to handle EU environmental projects in eastern and central Europe. POLITIKEN --- Minister of social affaires, Karen Jespersen, is now ready to change the present social security act to two seperate systems, one for unemployed people and one for people in distress. JYLLANDS-POSTEN --- Scandinavian Airlines System (SAS) is to open a new route from Copenhagen to Minsk in Russia and to Siberia and plans to open more routes to destinations in eastern Europe. --- Still more marriages in Denmark end after lasting 25 years, new figures from Denmark's Statistics Office show. Now every eighth 25-year-old marriage breaks up, compared to 1984 where every eleventh failed. BORSEN --- Competition between Danish harbours which was introduced in January 1995 has made the large harbours the winners in the battle to offer the lowest prices and the best shipping service. 3627 !GCAT These are leading stories in this morning's Paris newspapers. LES ECHOS -- French cabinet to discuss overhaul of corporate accounting principles to bring reporting into line with international standards. -- Prime Minister Alain Juppe to announce overhaul of social and fiscal payroll taxes within 10 days. -- Auchan owns 99 percent of Docks de France. -- Generale des Eaux does not rule out stake in SFP television production company, up for privatisation, but only after layoff plan. LA TRIBUNE DESFOSSES -- New tax to be announced in mid-October to finance health care deficit. -- President Jacques Chirac stresses need for firm control over public spending. -- Trade unions preparing autumn strikes. -- British Airways chairman Bob Ayling says he will not back out of USAir alliance. -- August new car orders should nearly double before government subsidy runs out on September 30. -- Economists see low interest rates in France and Germany through to year end while some even predict further central bank rate cuts. -- France weakens against mark only one day after interest rate cut. L'AGEFI -- Government wants commercial banks to cut their rates in wake of last Thursday's intervention rate cut. LE FIGARO -- President Jacques Chirac wants firm stand on immigration as courts block deportations. -- Chirac says he expects to continue working with Juppe for a long time to come. LIBERATION -- Four Africans deported on Saturday as courts release most others on technicalities. THE INTERNATIONAL HERALD TRIBUNE -- Algeria changes election law to avert further surprise results, replacing the two-round system that almost led to an Islamist victory in 1992. -- France frees 50 of the 220 illegal Africans removed from Paris church. LE PARISIEN -- Only about 20 Africans evicted from Paris church deported or still in custody. -- Paris Newsroom +33 1 4221 5381 3628 !GCAT The following are highlights of stories reported in the Irish press on Monday. IRISH INDEPENDENT - - Ireland's largest political party Fianna Fail said it could enter into another coalition government with the Irish Labour party after the next election. - Irish department store chain Dunnes Stores is preparing to invest up to 115 million punts over the next few years on new technology and bigger stores. - Dozens of privately-owned "green' sources of power generation are expected to come on stream over the next 15 months with enough energy to supply 100,000 homes, Irish state electricity body, ESB, said. - Irish science and technology minister Pat Rabbitte has criticised the Irish Brokers Association over their handling of complaints from investors who claim to have lost life savings after the disappearance of investment broker Tony Taylor, owner of Taylor Investements Group. IRISH TIMES - - A fleet of up to 30 Japanese tuna ships is still hovering on the 200-mile Irish teritorial limit as the fishing vessel with five dead crew on board travels to Cork. - Irish diplomat Erskine Childers died on Sunday after suffering a heart attack while attending the 50th anniversary of the World Federation of the United Nations Associations in Luxemburg. - Anglo-Dutch consumer group Unilever will receive another rebuff from tea distributors Lyons Irish Holdings on Monday when another circular is sent to shareholders. --Dublin Newsroom +353 1 676 9779 3629 !GCAT The following are some of the leading stories in Finnish papers this morning. HELSINGIN SANOMAT - The Observer newspaper says Finnish internet-distributor involved in spreading child porn on the net. The Finn says it is total rubbish. - No technical fault found in rally car which rushed into spectator area resulting in one dead and more than 30 injured in the 1,000 Lakes Rally. - Newspaper test group families take care of house keeping themselves. Would mainly like to buy cleaning and massaging services if they were cheaper. KAUPPALEHTI - The weakening of the markka last Friday and the Bank of Finland's tender rate cut were positive for the forest industry. Markka should be linked to ERM when it has weakened enough, Forest Industries Federation head Matti Korhonen said. AAMULEHTI - Raisio margarine producer targets fast growing markets in Eastern Europe. - Amount of women who keep their own surname when they get married is on the rise -- last year 13 percent of women kept their names compared to seven percent a year earlier. TURUN SANOMAT - Kids should be taught good manners like how to say hello and good eating habits in school, Education Minister Olli-Pekka Heinonen said. - Formula one race car driver Mika Hakkinen third in Belgium Grand Prix. HUFVUDSTADSBLADET - Finnish women celebrated 90th anniversary of their right to vote in Helsinki amusement park. -- Paivi Mattila, Helsinki Newsroom +358 - 0 - 680 50 292 3630 !GCAT The following are the main stories from Monday morning's Austrian newspapers. DIE PRESSE - Paper producers are in trouble due to unpredictability of the market and frequent price changes in the past. - Finance Minister Viktor Klima has criticised the social partners and Social Affairs Ministry in connection with labour contracts and social insurance contributions. DER STANDARD - Social Democrat EU candidate Harald Ettl said voters may use the October 13 European Union vote as an opportunity to express dissatisfaction with the ruling Social Democrat-People's Party coalition. - Austria's textile makers demand a halt in the liberalisation of EU's textile industry, to withstand growing pressure from Eastern Europe. KURIER - Austrian Transport minister Rudolf Scholten has announced that 1 billion schillings will be invested by the government in new technologies next year. SALZBURGER NACHRICHTEN - Austrians are buying less gold than in the years before, but Kerry Tattersall marketing chief of Muenze Oesterreich expects a rise due to low bank rates and the end of anonymity of securities accounts. 3631 !GCAT Following are some of the main stories in Dutch newspapers today. Reuters has not verified these stories and does not vouch for their accuracy. FINANCIEELE DAGBLAD - Investors disappointed at Dutch PTT KPN's profit growth. (p1) - Food group Nutricia's shares soar after 51 pct higher first-half net. (p1) - Civil engineering consultancy Fugro weighs sale of under-performing environmental division. (p1) - Consumer prices rise 0.3 pct in July from June, producing 2.1 pct year-on-year increase. (p1) - Speculations about restart of bankrupt aircraft-maker Fokker flare up again. (p1) - Dredger Boskalis reports slightly lower H1 profit growth, sees lower full-year results. (p3) - Textiel groep Twenthe books small first-half profit for first time since 1993. (p3) - MeesPierson, ABN Amro bank's merchant bank unit, posts first six months net up 67 pct at Dfl 132 million. (p4) - Plastics and textile company Ten Cate books 60 pct H1 profit increase due to high margins on synthetics. (p4) DE VOLKSKRANT - Fast-changing market forces research institute KEMA to re-organise. (p2) - IBM's Amsterdam branch needs licences for recycling and exporting used computers. (p2) DE TELEGRAAF - Social democrats party leader wants OAPs with high extra pension to pay for OAP benefits scheme. (p1) - First-half 1996 retail trade turnover up 2.9 pct from year ago. (p11) - Medium-sized and small businesses association wants economic affairs minister Hans Wijers to allocate environmental funds. (p11) TROUW - Fear of getting caught, not better moral principles, stops people defrauding social benefits - research. (p1) - Liberals plead for a lower petrol price increase. (p3) ALGEMEEN DAGBLAD - Economic affairs minister Hans Wijers to probe oil companies over possible price fixing. (p1) - The Netherlands will meet EMU entry criteria next year, according to latest, confidential figures. (p3) -- Amsterdam newsdesk +31-20-504-5000 3632 !GCAT !GVIO Two bombs exploded overnight on the French Mediterranean island of Corsica in a continuing wave of attacks blamed on separatist guerrillas, police said on Monday. No one was hurt in the blasts, which wrecked a post office in the resort of Saint-Florent and damaged a branch of the state auditing body in Pietrabugno. There was no claim of responsibility for the attacks but police said they seemed part of a two-decade-old campaign by separatists for greater autonomy from Paris. The outlawed Corsican National Liberation Front (FLNC), one of the main guerrilla groups, ended a shaky seven-month truce last week, accusing the government of reneging on secret commitments. 3633 !GCAT !GVIO Thousands of Tamils demonstrated outside the United Nations' European headquarters in Geneva on Monday to appeal for U.N. recognition of their fight for independence from Sri Lanka. The demonstrators, said by police to number 6,000, also urged the release of Nadarajah Muralidaran, Swiss-based leader of the the Tamil Tiger guerrillas, who has been held in a Zurich jail since April on charges of extortion. The demonstrators delivered an appeal to the U.N. human rights centre demanding an immediate end to "state terrorism" against Tamils and the Liberation Tigers of Tamil Eelam (LTTE). 3634 !C12 !CCAT !GCAT !GCRIM A U.S. appeals court gave Lloyd's of London a reprieve Tuesday in its multibillion-dollar reorganization, throwing out an injunction that the insurance giant said could have led to its collapse. The three-judge panel ruled that the injunction issued Friday by a U.S. district judge in Virginia should be dismissed, clearing the way for Lloyd's to give formal approval Thursday to its reorganization. In its ruling, the court noted that the plaintiffs, 93 U.S. investors in Lloyd's, had agreed to litigate any disputes in England, an indication of the court's reluctance to take jurisdiction in the case. The U.S. investors, known as Names, are likely to appeal the court's decision and will continue to pursue litigation in other U.S. courts, said Kenneth Chiate, a U.S. Name and a chief negotiator for the American Names Association. "My prediction is that the Names will appeal," Chiate said. "At this point it is a sufficiently important decision that I'm confident that they will appeal." "But to say that they definitely will would be premature until we determine what the exact basis for the court's ruling is," he said. Immediately after the ruling was issued, Lloyds issued a statement in London saying it extended the deadline for its investors to accept the agreement. The deadline had been for 8 a.m. EDT Wednesday but was extended indefinitely. Lloyd's also said 82 percent of its investors, or Names as they are known at Lloyd's, had accepted the proposed $2.2 billion settlement. But it said only 53 percent of the 2,700 U.S. names had accepted it. "Since we won the appeal, faxes have been flooding in from U.S. Names accepting the settlement offer," a Lloyd's spokesman said by telephone. "I am very pleased," said Lloyd's Chairman David Rowland. "I have believed for a long time that what we are doing is in the interest of the whole society (Lloyd's)." The reorganization plan was thrown into uncertainty Friday, when U.S. District Judge Robert Payne in Richmond, Va., ruled that Lloyd's sold securities to U.S. Names in violation of U.S. securities laws. Payne granted the injunction and ordered Lloyd's to provide more information to the U.S. investors by Sept. 23. Lloyd's argued in its appeal before the U.S. 4th Circuit Court of Appeals sitting in Baltimore that such a delay could cause the 300-year-old insurance market to collapse since it would be unable to meet the deadline to pass solvency tests in the United Kingdom and the United States. The appeals court subsequently sent the case back to the district court with instructions to dismiss it. During the hearing Tuesday, appellate Judge Paul Niemeyer said, "If we find the whole market is subject to American security laws, we could be looking at rescission (rescinding) of up to $2.2 billion in obligations." A Lloyd's spokesman said the ruling had removed the last major legal obstacle to Lloyd's recovery plan, aimed at ending years of turbulence triggered by huge liabilities. But several U.S. legal actions are still pending against Lloyd's. Colorado Attorney General Gale Norton said her office last week told Lloyd's it was considering a new legal action against Lloyd's based on allegations of consumer fraud. "We have notified them of our concerns and asked them to give us a response," Norton said. In addition, an appeal of a lawsuit filed by some 600 Names in California is still pending, Chiate of the American Names Association said. That lawsuit, which seeks rescission and restitution, was dismissed in U.S. district court and now is pending before the 9th U.S. Circuit Court of Appeals, Chiate said. Lloyd's hopes the support shown by Names will be enough to declare the plan unconditional when its ruling council meets Thursday. The plan still has to be approved by Britain's Department of Trade and Industry. Lloyd's problems began in the 1980s when a fatal combination of negligent underwriting, poor investment advice and a sequence of unexpected natural disasters conspired to bring about losses of several billion dollars. 3635 !C12 !CCAT !GCAT !GCRIM A U.S. appeals court gave Lloyd's of London a reprieve Tuesday in its multibillion-dollar reorganization, throwing out an injunction that the insurance giant said could have led to its collapse. The three-judge panel ruled that the injunction issued Friday by a U.S. district judge in Virginia should be dismissed, clearing the way for Lloyd's to give formal approval Thursday to its reorganization. In its ruling, the court noted that the plaintiffs, 93 U.S. investors in Lloyd's, had agreed to litigate any disputes in England, an indication of the court's reluctance to take jurisdiction in the case. Immediately after the ruling was issued, Lloyds issued a statement in London saying it extended the deadline for its investors to accept the agreement. The deadline had been for 8 a.m. EDT Wednesday but was extended indefinitely. Lloyd's also said 82 percent of its investors, or Names as they are known at Lloyd's, had accepted the proposed $2.2 billion settlement. But it said only 53 percent of the 2,700 U.S. names had accepted it. "Since we won the appeal, faxes have been flooding in from U.S. Names accepting the settlement offer," a Lloyd's spokesman said by telephone. "I am very pleased," said Lloyd's Chairman David Rowland. "I have believed for a long time that what we are doing is in the interest of the whole society (Lloyd's)." The reorganization plan was thrown into uncertainty Friday, when U.S. District Judge Robert Payne in Richmond, Va., ruled that Lloyd's sold securities to U.S. Names in violation of U.S. securities laws. Payne granted the injunction and ordered Lloyd's to provide more information to the U.S. investors by Sept. 23. Lloyd's argued in its appeal before the U.S. 4th Circuit Court of Appeals sitting in Baltimore that such a delay could cause the 300-year-old insurance market to collapse since it would be unable to meet the deadline to pass solvency tests in the United Kingdom and the United States. The appeals court subsequently sent the case back to the district court with instructions to dismiss it. During the hearing Tuesday, appellate Judge Paul Niemeyer said, "If we find the whole market is subject to American security laws, we could be looking at rescission (rescinding) of up to $2.2 billion in obligations." A Lloyd's spokesman said the ruling had removed the last major legal obstacle to Lloyd's recovery plan, aimed at ending years of turbulence triggered by huge liabilities. Lloyd's hopes the support shown by Names will be enough to declare the plan unconditional when its ruling council meets Thursday. The plan still has to be approved by Britain's Department of Trade and Industry. Lloyd's problems began in the 1980s when a fatal combination of negligent underwriting, poor investment advice and a sequence of unexpected natural disasters conspired to bring about losses of several billion dollars. 3636 !C12 !CCAT !GCAT !GCRIM A U.S. appeals court gave Lloyd's of London a reprieve Tuesday in its multibillion-dollar reorganization, throwing out an injunction that the insurance giant said could have led to its collapse. The three-judge panel ruled that the injunction issued Friday by a U.S. district judge in Virginia should be dismissed, clearing the way for Lloyd's to give formal approval Thursday to its reorganization. Immediately after the ruling was issued, Lloyds issued a statement in London saying it extended the deadline for its investors to accept the agreement. The deadline had been for 8 a.m. EDT Wednesday but was extended indefinitely. Lloyd's also said 82 percent of its investors, or Names as they are known at Lloyd's, had accepted the proposed $2.2 billion settlement. "I am very pleased," said David Rowland, chairman of Lloyd's. "I have believed for a long time that what we are doing is in the interest of the whole society (Lloyd's)." The reorganization plan had been thrown into uncertainty Friday, when U.S. District Judge Robert Payne ruled that Lloyd's sold securities to U.S. Names in violation of U.S. securities laws. Payne granted the injunction and ordered Lloyd's to provide more information to the U.S. investors by Sept. 23. Lloyd's argued in its appeal before the U.S. 4th Circuit Court of Appeals in Baltimore that such a delay could cause the 300-year-old insurance market to collapse since it would be unable to meet the deadline to pass solvency tests in the United Kingdom and the United States. The appeals court subsequently sent the case back to the district court with instructions to dismiss it. During the hearing Tuesday, appellate Judge Paul Niemeyer said, "If we find the whole market is subject to American security laws, we could be looking at rescission (rescinding) of up to $2.2 billion in obligations." In a statement from London, Lloyd's said it welcomed the court ruling and will press ahead with its recovery plan. 3637 !C42 !CCAT !E41 !ECAT !GCAT !GJOB French teachers' unions warned on Tuesday of protests including a likely strike over job cuts expected in the centre-right government's austerity budget but said they would meet again before deciding what action to take. The unions said in a statement after a meeting that they were "working to achieve the broadest possible unity" on action over the coming weeks with a view to striking in late September or early October and that they would meet again on September 3. As public sector unions prepare their response to planned budget cuts, Nicole Notat, head of the country's biggest union, the CFDT, also warned on Tuesday of "tension and conflicts" when the French return from their summer holidays. One teachers' union called in advance of the Tuesday meeting for members to protest against the job cuts in education which are expected under the government's 1997 spending-cut budget. The Federation Syndicale Unitaire (FSU) union made the call to action as it met representatives from the SE-FEN teachers union as well as education branches of the national unions CFDT and FO, to decide what action to take against the budget. It said conditions were ripe to prepare a national strike by the start of October. French schools re-starts next week. Tuesday's meeting kicks off a series opposing Prime Minister Alain Juppe's budget, which is expected to axe between 2,000 and 2,500 teachers' jobs -- the first teaching cuts in 15 years -- under a plan to shed 6,500-7,000 civil service jobs. Juppe has said the 1997 budget would freeze spending at 1996 levels, implying a spending cut of 60 billion francs ($11.89 billion), to reduce the state deficit to three percent of gross domestic product in order to join the single European currency in 1999. "There will be tension and conflicts when people go back to work," Notat told the daily Le Monde, citing anger among staff at ailing property lender Credit Foncier, state-owned bank Credit Lyonnais, film studio SFP and appliance maker Moulinex. The CFDT would take part in union action, she said. The Socialist-led CFDT, France's biggest union with some 650,000 members, is expected to announce its plans on September 27. Credit Foncier is being gradually wound down after making a 1995 net loss of 10.8 billion francs, while Credit Lyonnais is shedding jobs in a bid to make good losses totalling 21 billion francs racked up between 1992 and 1994. Some 667 jobs could go out of a total 1,056 at SFP if sold to businessman Walter Butler, while Moulinex is axing posts as part of a recovery plan. Former conservative prime minister Edouard Balladur, also in Le Monde, said France was suffering from a "lingering decline" and called for big cuts in income tax, local taxes and value added tax to boost consumer demand. Reducing government spending was necessary but not sufficient, he said. Communist Party leader Robert Hue said on Monday the spirit of public sector strikes which brought France to a virtual standstill for 24 days in November and December last year was "still alive in the hearts and minds" of the French people. The Communist-led CGT union will unveil on Wednesday its plans to mobilise opposition to the budget, which is due to be discussed in cabinet around September 10, along with proposals for tax and social security reform. The executive committee of the Force Ouvriere union will meet on September 3 and is expected to draw up its oppostion plans, a spokesman said. ($1=5.046 French Franc) 3638 !E12 !ECAT !G15 !G151 !G154 !GCAT !M13 !M132 !MCAT Europe's planned currency union is likely to begin on time at the end of the decade even though a series of issues still needs to be tackled before the start, a senior European monetary official said on Tuesday. Alexandre Lamfalussy, President of the European Monetary Institute (EMI), the forerunner to Europe's central bank, told a business group, "I am reasonably confident that (European Economic and Monetary Union) will start in 1999." Lamfalussy based his optimism on the fact that European nations were showing the necessary political will to meet prescribed entry criteria, having already made considerable progress on paring back inflation rates. "There is a clear determination on behalf of governments to meet the criteria," Lamfalussy said, adding, "nations have said they would do so and they are doing so." But Lamfalussy also warned that more work lay ahead, especially as nations were having difficulties meeting the criteria on public finances. To join the currency union, nations must show their budget deficits do not exceed three percent of gross domestic product and that debt does not exceed 60 percent of GDP, or at least convince their peers they are heading towards these levels. Even as nations scramble to get their budgets in order on time, Lamfalussy said it was clear that not all 15 European member nations could join the union at the beginning. "Not all nations will participate at the beginning, that is an understatement," Lamfalussy said, declining however to hint at which nations were likely to pass the test. Privately, EMI officials said the final decision on who would participate, to be reached officially by governments in the spring of 1998 after 1997's economic data are compiled, would come as no surprise to anyone. Periodic EMI reports detailing nations' progress as well as ongoing feedback to member nations should give sufficient preliminary information on nations' developments, ruling out the chance for last minute upsets, they said. The next status report will be published in November. By January the EMI, charged with drawing up a blueprint of instruments the future European central bank (ECB) will use to formulate policies, will also have completed the final catalogue of instruments to be used by the ECB. While the issue of using minimum reserves, something Germany is lobbying for very heavily, remains open, Lamfalussy said general agreement had been reached on implementing instruments like securities repurchase agreements. Lamfalussy added that the legal status of the Euro, the new common currency, in the changeover time between 1999 and the time when it is expected to be widely used in 2002 should be formalised before the end of this year. Meanwhile questions regarding those nations who do not meet the requirements and are relegated as the so-called "outs", will be discussed at several meetings in Dublin this year with Lamfalussy arguing a revised European exchange rate mechanism, ERM II, should be put in place. The ERM holds currencies within fixed bands around a a known central rate. Currencies which fluctuated beyond these limits were then entitled to help from the other members and liable to drastic policy changes if they failed to work. The ERM still operates in name. Once the currency union is underway, Lamfalussy said it was essential to have a mechanism that ensured nations do not relax fiscal vigilance, and spend much more than they take in tax. He therefore welcomed the idea of a stability pact which would trigger automatic sanctions punishing those who lapse. But Lamfalussy stressed that the EMI was in no way involved with advising on how to set up such a plan. "It is up to the finance ministers to concoct that, but we are in favour of such a pact." --Frankfurt Newsroom, +49 69 756525 3639 !CCAT !GCAT !GVIO Armed Iraqis who hijacked a Sudanese aircraft carrying 199 passengers and crew on Tuesday released all their hostages at Stansted airport near London. Police said the hijack drama ended peacefully and six of the hostage takers had been arrested. Police officers boarded the plane to make a thorough search. "Six men have been arrested. It may well be that there may be others involved," said police chief John Burrow. "We understand that they are Iraqi nationals. There may have been up to eight." Burrow told a news conference the hostage takers had apprently been seeking political asylum. Hundreds of armed police were deployed at Stansted airport, where the Sudanese Airways Airbus, orginally routed from Khartoum to Amman, landed in the early hours after being forced to divert to Cyprus for refueling. At Larnaca the hijackers had at one point threatened to blow up the jet. Some police stood as close as 50 metres (yards) from the aircraft, while dozens of police vans waited about 1.5 miles (two km) across the tarmac along with firefighters and ambulances. Meanwhile, negotiations were conducted by radio after an Iraqi exile group said the hostage-takers wanted to contact one of its members. The hijackers, who said they want to seek asylum in Britain, were believed to have been armed with grenades and possibly other explosives, according to police. An official at the Iraqi Community Association said they believed the hijackers were trying to contact an Iraqi named Sadik Sadah. Sadah is a former member of the Association's executive committee who now works as a volunteer. It was unclear whether Sadah made contact with the hijackers. Police were unable to comment on speculation that the Iraqis were diplomats based in Khartoum who were seeking to defect rather than return to Baghdad. The plane was hijacked on Monday evening soon after it left Khartoum for the Jordanian capital Amman. The hijackers started to release captives about two hours after the Airbus 310 airliner arrived at Stansted from Larnaca, where it was refuelled, at 4.30 a.m. (0330 GMT). Police said the passengers who disembarked, led by the elderly and mothers with small children, were very calm despite their ordeal. Two sick passengers were taken away in ambulances, but police said their illnesses were not related to the way they had been treated by the hijackers. Sanctions imposed on the government of Iraqi leader Saddam Hussein mean international flights do not land in Baghdad. Travellers fly to Amman and proceed overland. Members of Iraqi President Saddam Hussein's family defected to Jordan last year. Iraqi news media reported in February that the two top-level defectors, who were Saddam's sons-in-law, were murdered by relatives days after returning home to a pardon from the Iraqi leader. 3640 !C11 !C12 !C13 !CCAT !GCAT !GCRIM Lloyd's of London chairman David Rowland said on Tuesday that its Wednesday deadline for acceptances of its 3.2 billion pound ($5 billion) settlement offer would be extended following a U.S. court ruling in its favour. "We have decided in the circumstances we will keep the offer open," Rowland told Reuters in an interview. Rowland said the decision to keep the offer open beyond the Wednesday noon (1100 GMT) deadline was also due to the level of acceptances already received for the plan. Earlier, Lloyd's insurance market said more than 82 percent of its worldwide membership had accepted the offer, up from the 75 percent acceptance level it had announced on Saturday. He said he was delighted by the U.S. court ruling, which overturned an injunction granted by a lower court to a group of U.S. Names -- as investors in the London market are known. 3641 !CCAT !GCAT !GVIO Armed hijackers believed to be Iraqis released between 60 and 70 people on Tuesday from a Sudan Airways plane carrying 199 passengers and crew that landed in London after being diverted on a flight from Khartoum to Amman, authorities said. A spokesman for Stansted airport said that the unidentified hijackers were demanding to see a British-based member of the Iraqi Community Association, called Mr Sadiki, and that police were trying to trace him. Police spokeswoman Kim White said police had already contacted Sadiki and were trying to arrange to bring him to Stansted, 30 miles (48 km) north-east of London, to talk to the hijackers. The airport spokesman said the six hijackers, who police said were armed with grenades and possibly other explosives, were believed to be Iraqi nationals. The hijackers started to release people for the Airbus plane in batches of 10, starting with women and children, in what police described as a "controlled release". Police said most of the passengers were Sudanese but that there were also an unknown number of Iraqis, Jordanians, Palestinians, Syrians and Saudis. Later they said the number of passengers released from the plane had reached 80. 3642 !C12 !C13 !CCAT !GCAT !GCRIM McDonald's Corporation and McDonald's South Africa have been confirmed as the rightful owners of all McDonalds trademarks currently registered in South Africa, the group said in a statement on Tuesday. It said the judgement was handed down by a South African Appeal Court ruling. McDonald's South Africa managing director, Carter Drew, welcomed the judgement and said the group would continue with its expansion plans. "Current restaurant sales figures show that our... products have been well received and we are confident that we will achieve our targeted growth." McDonalds currently operates seven restaurants in South Africa, the majority of which are owned by local entrepreneurs. Since last year, the group has been involved in a lengthy trademark battle, trying through the courts to prevent a local rivals, businessmen George Sombonos and George Charalambous from using its name. McDonald's is the largest global food service retailer, with more than 19,200 restaurants in 94 countries. Nearly three quarters of McDonald's restaurants are franchised to over 4.500 owner-operators worldwide. -- Johannesburg newsroom 27 11 482 1003 3643 !GCAT !GPOL Slovakia's Prime Minister Vladimir Meciar sacked three key ministers on Tuesday, the news agency CTK reported. It said Slovak President Michal Kovac had accepted the firing of the economics, foreign affairs and interior ministers, and named replacements for the three. Tikhomirov said troops would resume pulling out of Grozny on Wednesday after halting at the weekend when a group of soldiers had their weapons taken. Withdrawal from some southern districts of Chechnya would be completed on Tuesday, he said. A final army withdrawal from the region would be the subject of new talks in the future, he added. Tikhomirov said that over the next four days a system of joint Russian-Chechen police patrols would get under way in Grozny, much of it in rebel hands since an August 6 offensive. The two sides would also begin work on exchanging prisoners. "There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement on what he called the "practical implementation of the Lebed plan". "We gave each other our word that no provocations would become grounds for a breakdown of negotiations," Maskhadov said. "Somehow in the end we got around to really acting on creating peace." 3644 !C12 !C31 !C34 !CCAT !GCAT !GCRIM The U.S. Justice Department said Tuesday that three companies and three of their executives have agreed to plead guilty and pay more than $20 million in criminal fines as part of the government's price-fixing investigation involving Archer Daniels Midland Co. It said Ajinomoto Co. Inc. and Kyowa Hakko Kogyo Co. Ltd., both based in Toyko, and the U.S. unit of the South Korean firm Sewon Company Ltd. admitted conspiring to fix prices to eliminate competition in the worldwide market for lysine, an animal feed supplement. The Justice Department said the three corporations have agreed to cooperate fully with the continuing investigation by providing witnesses who will be available to testify in the United States and documents. The Justice Department has been conducting a long-running investigation into allegations of lysine price fixing involving Archer Daniel Midlands and a number of its top executives. "This is the department's first action against international cartel activity in the food and feed additive industry," Assistant Attorney General Joel Klein said in a statement. "It sends a message to the entire world that criminal collusive behaviour that harms U.S. consumers will not be tolerated," he said, announcing that the plea agreements have been signed and that the criminal case has been filed in federal court in Chicago. The charges alleged the defendants conspired among themselves and with unnamed co-conspirators to suppress and eliminate competition in the lysine market from June 1992 until June last year, in violation of the federal antitrust laws. The Justice Department charged that the defendants and the unnamed co-conspirators: -- held meetings and conversations to discuss prices and volumes of lysine sold in the United States and elsewhere; -- agreed to charge prices at certain levels and to increase lysine prices; and to allocate among the firms the volume of lysine to be sold; -- issued price announcements and price quotations in accordance with the agreements; -- and participated in meetings and conversations aimed at monitoring and enforcing adherence to the agreed-upon prices and sales volumes. The plea agreements, in which the three firms and the three executives admit their guilt, must be accepted by a federal judge in Chicago. Ajinomoto and Kyowa Hakko each agreed to pay the maximum fine of $10 million while Sewon America will pay as much as the judge deems it can reasonably afford, Justice said. 3645 !C12 !CCAT !GCAT !GCRIM A U.S. appeals court gave Lloyd's of London a reprieve Tuesday in its multibillion-dollar reorganization, throwing out an injunction that the insurance giant said could have led to its collapse. The three-judge panel ruled that the injunction issued Friday by a U.S. district judge in Virginia should be dismissed, clearing the way for Lloyd's to give formal approval Thursday to its reorganization. In its ruling, the court noted that the plaintiffs, 93 U.S. investors in Lloyd's, had agreed to litigate any disputes in England, an indication of the court's reluctance to take jurisdiction in the case. The U.S. investors, known as Names, are likely to appeal the court's decision and will continue to pursue litigation in other U.S. courts, said Kenneth Chiate, a U.S. Name and a chief negotiator for the American Names Association. "My prediction is that the Names will appeal," Chiate said. "At this point it is a sufficiently important decision that I'm confident that they will appeal." "But to say that they definitely will would be premature until we determine what the exact basis for the court's ruling is," he said. Immediately after the ruling was issued, Lloyds issued a statement in London saying it extended the deadline for its investors to accept the agreement. The deadline had been for 8 a.m. EDT Wednesday but was extended indefinitely. Lloyd's also said 82 percent of its investors, or Names as they are known at Lloyd's, had accepted the proposed 3.2 billion pounds ($4.7 billion) settlement. (Corrects amount of settlement from $2.2 billion). But it said only 53 percent of the 2,700 U.S. names had accepted it. "Since we won the appeal, faxes have been flooding in from U.S. Names accepting the settlement offer," a Lloyd's spokesman said by telephone. "I am very pleased," said Lloyd's Chairman David Rowland. "I have believed for a long time that what we are doing is in the interest of the whole society (Lloyd's)." The reorganization plan was thrown into uncertainty Friday, when U.S. District Judge Robert Payne in Richmond, Va., ruled that Lloyd's sold securities to U.S. Names in violation of U.S. securities laws. Payne granted the injunction and ordered Lloyd's to provide more information to the U.S. investors by Sept. 23. Lloyd's argued in its appeal before the U.S. 4th Circuit Court of Appeals sitting in Baltimore that such a delay could cause the 300-year-old insurance market to collapse since it would be unable to meet the deadline to pass solvency tests in the United Kingdom and the United States. The appeals court subsequently sent the case back to the district court with instructions to dismiss it. During the hearing Tuesday, appellate Judge Paul Niemeyer said, "If we find the whole market is subject to American security laws, we could be looking at rescission (rescinding) of up to $2.2 billion in obligations." A Lloyd's spokesman said the ruling had removed the last major legal obstacle to Lloyd's recovery plan, aimed at ending years of turbulence triggered by huge liabilities. But several U.S. legal actions are still pending against Lloyd's. Colorado Attorney General Gale Norton said her office last week told Lloyd's it was considering a new legal action against Lloyd's based on allegations of consumer fraud. "We have notified them of our concerns and asked them to give us a response," Norton said. In addition, an appeal of a lawsuit filed by some 600 Names in California is still pending, Chiate of the American Names Association said. That lawsuit, which seeks rescission and restitution, was dismissed in U.S. district court and now is pending before the 9th U.S. Circuit Court of Appeals, Chiate said. Lloyd's hopes the support shown by Names will be enough to declare the plan unconditional when its ruling council meets Thursday. The plan still has to be approved by Britain's Department of Trade and Industry. Lloyd's problems began in the 1980s when a fatal combination of negligent underwriting, poor investment advice and a sequence of unexpected natural disasters conspired to bring about losses of several billion dollars. 3646 !GCAT !GPOL President Bill Clinton on Tuesday proposed a $2.75 billion literacy campaign for children and said he would pay for it in part by eliminating billions of dollars in tax breaks for multinational corporations. White House aides said that during his speech on Thursday accepting the Democratic re-nomination, Clinton also planned to propose at a $3.4 billion package to get jobs for people on welfare, fleshing out legislation he signed last week. In addition, Clinton will propose a $2 billion environmental programme on Wednesday to help clean up poor urban areas, the aides said. The welfare jobs plan, centrepiece of his Chicago speech and a top priority of a second Clinton term, would encourage "creating jobs in an effort to make welfare reform a success," said White House spokesman Mike McCurry. Other aides said the package is expected to include tax breaks for businesses that create jobs in inner city areas. The president has taken a lot of heat from liberal Democrats for signing legislation that ended the federal goverment's 61- year guarantee of welfare assistance for poor children. Churning through the election battleground state of Michigan aboard his whistlestop train, Clinton announced in the blue-collar factory town of Wyandotte the latest in a series of proposals aimed at generating popular enthusiasm as he makes his way to the Democratic National Convention in Chicago. On the third day of his four-day train ride, Clinton went to Bacon Memorial Public Library to say he wanted to lead a national effort to ensure that "all America's children" can read on their own by the third grade, or about age eight. With national reading scores lagging behind recent advances in math and science, Clinton said many children needed individualized attention and called for a "citizen's army" of one million volunteers to help 30,000 reading specialists and volunteer coordinators who would be hired. "Every single, tired night a parent spends reading a book to a child is a night well worth it. Every dollar we spend bringing in people to help these kids after school with personal tutoring is a dollar well worth it," he said. Later, the Clinton train passed through Rust Belt urban decay around Detroit, and stopped in Royal Oak for a rally. He spoke to a large, enthusiastic crowd gathered at a railroad crossing in town and accepted the endorsement of the National Association of Police Organisations, the country's second largest police union with 185,000 members. The reading programme, which would require congressional approval, would spend $2.75 billion over five years, most of it to hire the specialists to help communities provide extra reading help before and after school for 3 million children at 20,000 schools. Some $1 billion of the total would go to Clinton's national service programme, AmeriCorps, which the Republican-led Congress tried but failed to kill last year as an example of wasteful government spending. Lest he be accused by Republicans as a big-spending Democrat, Clinton aides said he would propose $8.4 billion in budget cuts to pay for the reading programme as well as other initiatives he will announce this week. But of course that did not stop the campaign of Republican presidential nominee Bob Dole from attacking the idea. "Instead of pursuing fundamental reform -- by confronting the teachers' unions and embracing school choice -- Bill Clinton announces a new government programme and a new pot of money for the unions," Dole's deputy press secretary Christina Martin said. Putting some bite into frequent administration threats to reduce so-called "corporate welfare," Clinton would raise $5.3 billion over six years by limiting export-related tax breaks for multinational corporations, aides said. For 70 years, multinationals that export products abroad have been able to declare half of their export profits as income from foreign sales and therefore eligible for U.S. tax breaks. Clinton would eliminate this. "None of these things will be popular, a lot of these things will have people who will be unhappy, but this is the real world of paying for specific savings," said Clinton economic adviser Gene Sperling. 3647 !C24 !C42 !CCAT !E41 !ECAT !GCAT !GJOB ValuJet Inc. said Tuesday it temporarily laid off 134 customer-service workers to conserve cash while it waits for regulatory approval to resume operations. The company had previously recalled 500 workers, including pilots, flight attendants and customer-service agents, in hopes of returning to the skies by Aug. 23. ValuJet, however, remains grounded while it waits for regulatory approval from the U.S. Department of Transportation and the Federal Aviation Administration. Keeping the customer service agents on the payroll while being grounded "just didn't make sense," said ValuJet spokesman Gregg Kenyon. "We anticipate this being a short-term situation," Kenyon said. "We've taken steps to have these workers give us a number where they can be reached immediately when we get approval." The airline now has about 650 to 750 workers on payroll, down from about 4,200 during normal operations, Kenyon said. ValuJet, which suspended operations in June after a crash in the Florida Everglades that killed all 110 people on board, said it expects to resume service shortly. ValuJet plans to resume service with seven aircraft and flights between Atlanta and five other U.S. cities when it receives government approval. ValuJet's stock closed Tuesday at $10.875, up 12.5 cents, on Nasdaq. 3648 !C12 !C31 !C34 !CCAT !GCAT !GCRIM The Justice Department said Tuesday that three companies and three of their executives have agreed to plead guilty and pay more than $20 million in criminal fines as part of the government's price-fixing investigation involving Archer Daniels Midland Co.. It said Ajinomoto Co. Inc. and Kyowa Hakko Kogyo Co. Ltd., both based in Tokyo, and the U.S. unit of the South Korean firm Sewon Company Ltd. agreed to plead guilty to conspiring to fix prices to eliminate competition in the worldwide market for lysine, an animal feed supplement. The department said the three corporations have agreed to cooperate fully with the investigation by providing documents and witnesses who will be available to testify in the United States. All of the defendants already have started cooperating, department officials said. The department has been conducting a long-running investigation into allegations of lysine price-fixing involving ADM and a number of its top executives. ADM, an agricultural giant based in Decatur, Illinois, with more than $12 billion in annual sales, declined to comment. Since the probe was first announced in June 1995, ADM has denied any wrongdoing and says it is cooperating fully. "This is the department's first action against international cartel activity in the food and feed additive industry," Assistant Attorney General Joel Klein said in a statement. "It sends a message to the entire world that criminal collusive behaviour that harms U.S. consumers will not be tolerated," he said, announcing the plea agreements have been signed and the criminal case has been filed in federal court in Chicago. Asked specificially about ADM in light of the new developments, Justice Department spokeswoman Gina Talamona would only say, "Our investigation continues." In a separate proceeding, ADM agreed in April to pay $25 million to settle a civil lysine price-fixing lawsuit brought by its customers as part of an overall $45 million settlement that also involved Ajinomoto and Kyowa Hakko. ADM agreed to the settlement without admitting or denying guilt. The charges to be settled by the plea bargain announced Tuesday alleged that the defendants conspired among themselves and with unnamed co-conspirators to suppress and eliminate competition in the lysine market from June 1992 until June last year, in violation of federal antitrust laws. The department charged that the defendants and the unnamed co-conspirators: -- held meetings and conversations to discuss prices and volumes of lysine sold in the United States and elsewhere; -- agreed to charge prices at certain levels and to increase lysine prices; -- agreed to allocate among the firms the volume of lysine to be sold; -- issued price announcements and price quotations in accordance with the agreements; -- and participated in meetings and conversations aimed at monitoring and enforcing adherence to the agreed-upon prices and sales volumes. The plea agreements, in which the three firms and the three executives admitted their guilt, must be accepted by a federal judge in Chicago. Ajinomoto and Kyowa Hakko each have agreed to pay the maximum fine of $10 million while Sewon America will pay as much as the judge deems it can reasonably afford, the department said. Also agreeing to plead guilty were Kanji Mimoto, Ajinomoto's former general manager of the feed additives division; Masaru Yamamoto, the former general manager of Kyowa Hakko's agricultural products department; and Jhom Su Kim, president of Sewon America Inc. 3649 !C17 !CCAT !G15 !G157 !GCAT Ferdinand Piech, management board chairman of German carmaker Volkswagen, on Tuesday defended the decision by the Saxony government to pay subsidies to the company in defiance of a European Union ban. "We believe that the decision by the premier of Saxony to grant subsidies to Volkswagen is a decision for the people and for jobs in Saxony. This is also how we view our decision to invest in this location," Piech told journalists. The group was introducing its new Passat vehicle. Saxony and the European Commission locked horns in June when the Commission approved only 540 million marks ($366 million) of a proposed 780 million marks in subsidies for Volkswagen to build two plants in the formerly communist east German state. Saxony Premier Kurt Biedenkopf decided to hand over all the money anyway, saying 23,000 jobs depended on it. "Volkswagen has created jobs with a future in Saxony, a step that leads the way for the entire region," Piech said. He added the subsidies, which Volkswagen will use for expansion at plants in the region, will create around 3,000 new jobs. "We have got the money and we are going to invest the money," Piech said. These investments "will help bring this region back into line with its past," Piech added. Saxony was one of the most industrialised regions in Germany before World War Two, but suffered under the communist East German government. Already investment in Saxony had resulted in the creation of some 20,000 jobs, Piech said, adding Volkswagen has been the leading private investor in the five east German states. By the end of 1997 Volkswagen will have invested the entire scheduled investment volume of 3.5 billion marks, Piech said. Piech said that the company was not breaking laws by investing the subsidies. "We feel that we are doing the right thing in legal terms, our legal expects have confirmed that we are doing the right thing, we are going by the book," Piech said. He also reaffirmed comments by Saxony's premier Kurt Biedenkopf that the government did not feel blackmailed by VW's statements that the carmaker would look elsewhere to invest if it did not receive the subsidies. Biedenkopf said on Tuesday he could not accept the suggestion by EU Competition Commissioner Karel Van Miert that the subsidies be paid in escrow until the matter is settled. Piech added, "We have carried out this project as friends with people who deserve this investment in the future." German Economics Minister Guenter Rexrodt said earlier on Tuesday he saw signs that tensions between Germany and the EU were easing over the matter. He expressed support for Saxony and VW saying, "The German government stands on the side of Saxony and Volkswagen, which deserves to get the full allotment of subsidies." ($1=1.4747 Mark) 3650 !C12 !C16 !CCAT !GCAT !GCRIM Troubled insurance market Lloyd's of London said on Tuesday that over 82 percent of its worldwide membership had accepted the terms of its 3.2 billion pound ($4.99 billion) rescue plan ahead of Wednesday's crucial deadline. The announcement came as the market awaited a U.S. appeals court decision due at 1800 GMT which threatens to throw the recovery plan off track, by giving American investors more time to think over the settlement offer. It also emerged on Tuesday that New York regulators may freeze the insurance market's assets if Britain declares the market insolvent. With just one day to go until the deadline for its 34,000 investors worldwide -- called Names -- to accept or reject the proposals, Lloyd's is hoping that the support shown by Names will be enough to declare the plan unconditional when its ruling council meets on Thursday. "I am encouraged by the steady flow of acceptances we have received since midday on Saturday. At that time 75 percent of our members had accepted," Lloyd's chairman David Rowland said in a statement. "I am confident that the acceptance level will have increased yet again by the time our deadline is reached at non tomorrow (1100 GMT)," Rowland added. But an injunction granted by a judge in Virginia late on Friday granting all 2,700 U.S. Names extra time to consider the plan, under which they would help pay to reinsure billions of pounds of liabilities into a new company called Equitas, means success is less than certain. New York's insurance regulator said it would move to seize Lloyd's U.S. trust fund assets only if Britain's Department of Trade and Industry declares Lloyd's insolvent. If the British regulator decides Lloyd's is insolvent and that the reorganisation plan will work, New York will not need to take action, a spokesman for the insurance department told Reuters in New York. A Lloyd's spokesman declined to comment on whether the funds might be frozen. He said the insurance market was in constant contact with the New York Insurance Department and was keeping it fully informed of developments. On Monday, its lawyers were preparing for the appeal in Baltimore, Maryland, which could run to Wednesday. The acceptance deadline passes at noon London time (1100 GMT) on Wednesday and Lloyd's will know shortly afterwards if it has enough "yes" votes to declare the recovery plan unconditional. The insurance market's leaders have constantly emphasised that the August 28 settlement deadline is immutable, because Lloyd's must shortly afterwards pass annual solvency tests both in Britain and the United States. Rowland is hoping support for the plan will swell to the critical mass of settling litigants and major debtors needed to push it through. But some form of limited extension should not necessarily be ruled out. The number of U.S. Names electing to wait while the judge's order remains in force is likely to be a key factor in whether Lloyd's can implement the recovery proposals as planned. Under the terms of the injunction, which Lloyd's hopes to overthrow, U.S. Names are not barred from accepting the plan. But Payne has said Lloyd's should provide them with more information by September 23. They have until September 30 to pay funds into an escrow account, after which there remains another month in which to accede finally or not. Even if the insurance market does succeed in overturning the judge's order, further litigation is still a possibility. A top legal official in Colorado, which signed an agreement along with 37 other U.S. states in July ending action against Lloyd's in return for extra financial assistance for U.S. Names, said last week that it was working on a new claim. ($1=.6415 Pound) 3651 !C12 !CCAT !GCAT !GCRIM Lloyd's of London was back in court on Tuesday in a bid to overturn a U.S. court ruling that it claims threatens its reorganization plan. Lloyd's was set to argue that the court ruling Friday granting a preliminary injunction blocking the plan could eventually lead to the collapse of the 300-year-old insurance market. A hearing on Lloyd's appeal of the ruling was set to begin Tuesday morning in the U.S. Court of Appeals for the Fourth Circuit in Baltimore. U.S. Circuit Judge Paul V. Veimeyer said Tuesday the court would issue its ruling in the case at 2 p.m. EDT (1800 GMT). At issue is Lloyd's plan to reorganize by reinsuring billions of dollars of liabilities into a new company called Equitas. It is asking its investors -- known as Names -- to help pay for Equitas and has offered to forgive some of their outstanding liabilities in return for an end to litigation and their association with Lloyd's. Lloyd's says investors must decide whether to accept or reject the plan by Wednesday because its ruling council meets on Thursday to determine whether the plan can be declared unconditional. Such a declaration is needed because the market must meet solvency tests with British regulators by the end of the month, with the New York insurance department by Sept. 1 and with the U.S. Treasury by Sept. 30, according to Lloyd's motion to appeal. More than 75 percent of Lloyd's 34,000 investors worldwide have already accepted the offer. But Lloyd's has said the reorganization plan cannot proceed without the consent of its American investors. If it were to lose the appeal, a Lloyd's spokesman said it would be forced to reconsider its alternatives and consider contingency plans. It said in its motion that the British government, which regulates Lloyd's, has reviewed the reorganization plan and has concluded that it is critical to Lloyd's survival. It also said that excluding American Names, or even some of them, from reinsurance into Equitas was not possible. "Failure to satisfy the solvency tests would lead inexorably to 'run-off,' in which no new policies could be issued and the sole focus of the market would be the settlement of claims made on existing policies," it said. In run-off, administrative expenses would increase, syndicate assets would be frozen and policyholders would file lawsuits, Lloyd's said in the motion. 3652 !C15 !C152 !C21 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Boeing Co. said Monday it will increase the production rate for its new 777 jet transport to seven airplanes per month from five planes, and as a result, expects to add 5,000 new workers by the end of the year. Boeing also said the increase is expected to bring its total work force to 118,350 by the year end. The hike in Boeing employees is in addition to an increase of 8,200 announced earlier this year. At the start of the year, Boeing said its work force totalled 105,180. "Today's announced production rate increase is in response to continued strong market demand for the 777, and the employment increase reflects today's rate change as well as staffing requirements for product development activities," said President and Chief Executive Phil Condit. Boeing said employment would grow by about 9,800 in Washington state, 3,300 in Wichita, Kansas, and by 400 at other Boeing locations. However, the job count would fall by 300 for the year in Philadelphia. Boeing's stock gained 75 cents to $91.125 in morning trading on the New York Stock Exchange. 3653 !E12 !ECAT !GCAT !GPOL Palestinian Trade Minister Maher al-Masri said on Tuesday that Israel's Finance Minister Dan Meridor promised in a meeting to find ways to ease a crippling closure on the West Bank and Gaza Strip. But neither Masri nor Meridor gave specifics. Meridor said the two sides agreed to resume economic cooperation halted since last February by holding monthly meetings of the joint Palestinian-Israeli economic committee. He added that Israel and the Palestinians would be meeting in the next few weeks to coordinate positions ahead of the September 5 meeting of international donors who have pledged aid to the peace process. "Mr Meridor said he would study ways to ease the closure which he said harmed the Palestinians," Masri told Reuters after the meeting. "On my part, I insisted that Israel stop violating the accord. I said the economic accord must be implemented and the closure must be lifted," he said. Masri and Meridor met at Israel's Finance Ministry in Jerusalem in the highest level meeting between Israel and Palestinian officials since Foreign Minister David Levy met Palestinian President Yasser Arafat on July 23 in Gaza. Masri warned that if the problem of the closure was not solved, "undoubtedly economic hardships will create social problems and will have a derailing of the peace process". Israel's previous government, ousted in May 29 elections, signed the 1993 interim peace deal with the Palestinians. The new government opposes trading land for peace, a cornerstone of the deal and Palestinians fear it wants to halt the peace process in its tracks. Meridor said he and al-Masri had discussed general issues and had not gone into details. He described the meeting as good. "There is a common interest to improve the economic situation in the territories under Palestinian jurisdiction and we will work together to promote this interest," Meridor said. Israel's previous government imposed the closure in reaction to a wave of Islamic militant suicide attacks in February and March. The government of Prime Minister Benjamin Netanyahu, which took office in June, has continued the ban which bars tens of thousands of Palestinian labourers from livelihoods in Israel. "The closure in itself is a violation of the economic accord," Masri said. Masri said there were over 35 Israeli violations of the general peace accord, including economic issues such as obstructing the construction of a Palestinian port and airport in the Gaza Strip self-rule enclave. PLO officials said as a result of the closure, tens of thousands of Palestinian workers lost their jobs in Israel and unemployment has reached an unprecedented level of 51 percent in the West Bank and Gaza Strip, home to nearly two million Palestinians. They said some economic sectors were completely paralysed and the obstruction of the movement of goods in and out of self-ruled areas harmed industries and development projects. Israeli officials said the government eased the closure last month. Some 45,000 Palestinians can now work in Israel. Israel has gradually pared down its Palestinian work force. Before the outbreak of the Palestinian uprising began in December 1987, some 160,000 Palestinians worked in Israel. 3654 !C17 !C34 !CCAT !G15 !G157 !GCAT German economics minister Guenter Rexrodt said on Tuesday he sees signs from the European Union of an easing of tensions over disputed subsidies by the state of Saxony to auto maker Volkswagen AG. Chancellor Helmut Kohl's cabinet discussed whether to file a complaint with the European Court of Justice in Luxembourg in the case, but reached no decision at its regular meeting on Tuesday, Rexrodt told Reuters. The government will continue to prepare its case, but will hold off taking action for now, he said. "The German government stands on the side of Saxony and Volkswagen, which deserves to get the full allotment of subsidies," Rexrodt said. Rexrodt said fresh discussions would take place on all levels in the next few days, but that preparatory work on a possible complaint by Bonn would continue. Such a complaint would have to be filed by September 16, he said. "We want to take advantage of the signals of de-escalation from Brussels," he said, without getting more specific. Rexrodt said Bonn and Brussels needed to work out their interpretations of the Treaty of Rome, whose Article 92 says that subsidies are acceptable in regions affected by the former separation of Germany. Brussels also indicated earlier this week it was preparing to file a complaint. Rexrodt said he hoped such an impasse could be avoided. The row began in June when the European Commission approved only 540 million marks ($365.5 million) of a proposed 780 million marks in subsidies for VW to build two plants in the formerly communist east German state of Saxony. Saxony premier Kurt Biedenkopf decided to hand over all the money anyway, because he said 23,000 jobs depended on it. Saxony filed a complaint in Luxembourg last Friday. Saxony premier Kurt Biedenkopf said on Tuesday he could not accept the suggestion by EU Competition Commissioner Karel Van Miert that the subsidies be paid in escrow until the matter is settled. 3655 !GCAT !GCRIM !GPOL A day after disgraced former president Chun Doo Hwan was sentenced to death on charges of mutiny and treason, his defence lawyers on Tuesday were studying ways to challenge the court ruling. Neither Chun nor his presidential successor Roh Tae-woo, sentenced to 22-1/2 years in prison on similar charges stemming from a 1979 military coup and an army massacre of pro-democracy demonstrators in the city of Kwangju the following year, have yet lodged formal appeals. "The defence team is studying whether to appeal against the sentence," an aide to Lee Yang-woo, Chun's defence lawyer, said by telephone. But media reports said lawyers of Chun and Roh were already preparing to challenge the rulings and that the appeals could drag through the courts for up to eight months. The lawyers were not immediately available for comment. The sentences would be confirmed if the defendants failed to appeal within seven days after the rulings. State prosecutors said on Tuesday they would decide by the end of this week whether to appeal Roh's sentence. They had demanded life in jail. Few Koreans think Chun will hang, and there is intense speculation over whether President Kim Young-sam will end one of the most traumatic chapters in modern Korean history by offering both men a clemency before he steps down next year. President Kim would have to weigh public disgust for Chun and Roh against the support both men still have in their home provinces. However, popular anger against the former generals is waning, partly because the trial threw up so much evidence to show they were simply at the tip of a pyramid of corruption that touched almost every layer of society. "The rule of law is important but political virtue and generosity are as much important as that," said Moon Chung-in, a professor of politics at Yonsei University. He said President Kim and his ruling New Korea Party would have nothing to gain if the sentences were carried out. Moon was echoing sentiment in some quarters that the one-time military academy classmates had suffered enough, and that to hound them further would be unnecessarily cruel. Kwon Moo-soo, a professor at Kookmin University, said the court rulings could help stabilise domestic politics by backing up President Kim's campaign to put history to rights. Meanwhile, some of the country's top business tycoons who received jail terms on Monday on charges of giving bribes to Roh during his presidency, began appealing against their sentences to the Seoul District Criminal Court. A court official said Jinro group chairman Chang Jin-ho and Hanbo group's honorary chairman Chung Tae-soo on Tuesday submitted appeals to the three-judge panel that sentenced each of them to two years in prison. "They said they were appealing against the jail sentences which they cannot accept," the official said. Chang and Chung were among nine business tycoons convicted of bribing Roh. Daewoo group chairman Kim Woo-choong was also sentenced to two years in jail and Choi Won-suk, head of Dong-Ah group, to 2-1/2 years. The other five, including Samsung group chairman Lee Kun-hee, received suspended jail sentences. 3656 !GCAT !GPOL Slovakia's Prime Minister Vladimir Meciar on Tuesday sacked three key ministers and immediately named their replacements, the president's office said. A statement said President Michal Kovac had accepted the firing of economics minister Jan Ducky, foreign minister Juraj Schenk and interior minister Ludovit Hudek. They were replaced by Karol Cesnek, 49, as economics minister, Pavol Hamzik, 42, as foreign minister and Gustav Krajci, 45, as interior minister. The three sacked ministers and their replacements were nominated by Meciar's ruling Movement for a Democratic Slovakia (HZDS). No reason has yet been given for the move. But on Monday a president's spokeman said changes to the cabinet were imminent after Meciar had met face to face with Kovac for the first time for more than a year. Cesnek is a former general director of the Slovak state power producer Slovenske Elektrarne, Hamzik is a career diplomat currently serving as ambassador to Germany, and Krajci is an executive of the Bratislava branch of Meciar's HZDS. According to the constitution, the president appoints and recalls ministers on the recommendation of the prime minister. The three parties represented in Meciar's coalition government were shaken in June by bitter squabbling over privatisation and oversight of the secret service. But a full disintegration of the group apparently was avoided after inter-party talks at the end of June. The new ministers will be sworn-in by Kovac on Tuesday evening. 3657 !C42 !CCAT !E41 !ECAT !GCAT !GJOB A spate of high-profile strikes in Britain this summer has shown that, despite 17 years of hostile government legislation, the trade unions are still a force to be reckoned with, the leader of Britain's unions said on Tuesday. "Trade unionism is still around, and still capable of having a scrap," John Monks, general secretary of the Trades Union Congress (TUC), told Reuters in an interview. Mail workers have held a series of one-day strikes in a dispute over working arrangements, and London underground railway drivers have staged short stoppages for a better pay and hours deal. Monks pointed out the private sector had been affected, too, with disputes at British Airways and Peugeot. "The economy is getting better, and there are opportunities, at least for some workers, to say it's about time our interests were taken more into account by employers," Monks said. Some experts believe the Labour Party's lead of around 20 points in the opinion polls ahead of an election to be held by mid-1997 has also helped restore union confidence. Labour leader Tony Blair has reduced the unions' influence over the party and has refused to repeal Conservative anti-union laws enacted since 1979, but he is pledged to the introduction of a minimum wage and industrial relations changes. Monks said the TUC "genuinely welcomed" Labour's pledge to sign up for the European Union's Social Chapter, which guarantees minimum working conditions, and other promises such as greater union recognition rights. The TUC will be lobbying for a more positive attitude towards Europe from a Labour government. "We stand unabashed on the pro-European side of the argument, including on the single currency," Monks said. Staying outside but shadowing the single currency would mean "you accept all the disciplines without the influence", he said. Staying outside and floating, on the other hand, would carry high risks. "The likely costs include higher interest rates in this country and probably some kind of surcharge on British exports into the single market," Monks said. To the annoyance of some unions, Labour has declined to fix a figure for the national minimum wage, and will instead set up a commission, with union and employer members, to advise on a level after the election. The TUC holds its annual conference next month and Monks said various figures would be put forward for debate, from 3.70 pounds ($5.77) to 4.26 pounds ($6.64) an hour. Another source of embarrassment for Labour will be calls for the renationalisation of the railways, or at least of RailTrack, which owns the tracks and stations. Reluctantly, most unions accept that Labour will have better things to do with scarce public funds than renationalise everything privatised by the Conservatives since 1979. But Monks said: "There's still a strong feeling in the Congress, and that should be expressed this year, that the railways should be publicly owned, or certainly the track -- the Railtrack part of it -- should be." "We'll be making demands for some renationalisation in the rail industry...A publicly-owned railway is a popular concept and one we hope we could persuade Labour to look afresh at." ($1=.6415 Pound) 3658 !CCAT !GCAT !GVIO Unidentified hijackers released 40 people on Tuesday morning from a Sudan Airways plane carrying 199 passengers and crew that landed at an airport near London after being diverted on a flight from Khartoum to Amman. A police spokesman told reporters there was a "controlled release of hostages" under way by the six or seven hijackers on board the Airbus jet who she said were armed with grenades and possibly other explosives. Reporters at Stansted airport some 30 miles (50 km) northeast of London watched women dressed in brightly coloured costumes carry young children down the aircraft steps as armed police stood by. The sick and elderly were also among those allowed to leave the plane. British police said the hijackers, thought to be from Sudan or a Middle East country and to have their families with them on the plane, had issued just one demand -- to be allowed to speak to an unidentified fellow countryman based in London. The plane landed at Stansted around 4.30 a.m (0330 GMT) after flying from Cyprus where it had been refuelled. Police spokeswoman Kim White said most of the passengers were Sudanese but there were also an unknown number of Iraqis, Jordanians, Palestinians, Syrians and Saudis. 3659 !CCAT !GCAT !GENV !GVIO Ecological warfare has broken out across the British construction industry, striking some of the biggest corporates as activists give up peaceful protests and seek to hit builders where it hurts -- their profit margins. Described by one British company as "eco-terrorism", it is seen as the new business risk of the 1990s. Famous names like Tarmac Plc, Costain Group Plc and ARC, a unit of conglomerate Hanson Plc, have all been targeted. Activist groups are no longer seen by British firms as a harmless, badly organised ragbag of students and hippies. "You only have to see them in action at protests," said David Harding, spokesman at ARC, Hanson's aggregates company. "They walk around with mobile phones and camera equipment, they communicate and gather support for demos via the Internet -- we're talking about a highly sophisticated organisation." One road protestor under the codename Steady Eddie told construction journal "Building" earlier this year, "If it comes down to full-scale economic warfare, we will aim to drive them out of business." As well as financial threats, companies also emphasise the "terror" tactics used. Costain's contract to build the controversial Newbury bypass, which runs through a conservation area, has led to violent protests delaying building, bomb threats, staff intimidation and picketing of chief executive Alan Lovell's home. A Costain spokesman told Reuters:"We've had all sorts of protests at the head office and the chief executive's house. But it's when it gets to the (employee) families -- that it goes across the line." Tactics used by some underground groups including the cryptic Berkshire Wood Elves, which distribute leaflets with instructions on home-made explosives, are now the subject of a police investigation. Other larger activist groups include Earth First, The Land is Ours, Alarm UK and Road Alert. The groups have targeted specific projects like the Newbury bypass and the M3 motorway through Twyford Down in the southern county of Hampshire. But they are also campaigning on broader issue such as stopping the government road building programme and out-of-town superstores which they say create more traffic, pollution and damage local communities. The government has slashed its road-building spending. Although protests may have contributed to the decision it has been seen primarily as economic rather than ecological. Graham Watts, chief executive of the Construction Industry Council, said :"I don't think many firms involved in tendering for sensitive projects realise the impact environmental activity has on the cost of running a project. "But they are more alert than they were 3-4 years ago. There's no doubt it's a big issue now." He says the damage comes in two forms: "Tangible -- in the form of extra costs, additional security, threats to staff and the more intangible damage caused by negative publicity." Watts said the cost of protesting can be heavy once the company is locked into a contract. "I do often hear on the industry circuit of tales where the company tenders at low margins and the demonstrations which follow means they are running the project at a loss." ARC says it's not just contractors in the front line but also suppliers like itself. Its own quarries came under attack after it emerged that it may be a supplier for the Newbury bypass. "It was called the "First Battle of the Newbury bypass'," said ARC's Harding. "We had 300 Earth First protestors invade and occupy our site. Hundreds of thousands of pounds (dollars) of damage was done in one day. Plus there was the knock-on cost of lost production and extra security in future." Simon Brown, analyst at investement bank UBS, said this new phenomenon has led to a change in the way the industry evaluates project risk. "When talking to Tarmac about the M3 link (through Twyford Down) they made it fairly clear that their risk assessment methods have been changed and now involve a very clear environmental risk analysis." Harding says others have done the same. "As a result of eco-terrorism we are looking at controversial jobs more closely to see if the profit margins are wide enough to cover things like extra security." For an industry already suffering from razor-thin margins, overcapacity and stagnant demand, eco-terrorism is the latest bizarre twist in the construction sector's tale of woe. 3660 !GCAT !GENT London's annual Notting Hill Carnival, the largest in Europe and second in the world only to Rio, ended peacefully on Monday with an estimated 800,000 revellers singing and dancing the day away in high spirits. Police said they made 30 arrests and there were two stabbings. But there was no repeat of the ugly scenes that used to scar the street festival, and police praised the crowds over the two days of festivities as good-natured. Around 400 police were wounded in riots in 1976 when the carnival, now in its 31st year, acquired its darker reputation from which it is now only slowly recovering. Shopkeepers still board up their windows and many residents leave town for the weekend, but for four or five years there has been no disorder and relatively little crime. 3661 !G15 !GCAT SUNDAY, DECEMBER 15 STRASBOURG - Council of Europe holds symposium on "Medically-assisted procreation and the protection of the human embryo" (To December 18). MONDAY, DECEMBER 16 BRUSSELS - Farm Council (To December 17). TUESDAY, DECEMBER 17 BRUSSELS - Economic and Social Committee (ECOSOC) holds plenary session (To December 19). THURSDAY, DECEMBER 19 BRUSSELS - Fisheries Council (To December 20). Provisional agenda includes: - Proposal for a Council regulation fixing, for certain fish stocks and groups of fish stocks, the total allowable catches for 1997 and certain conditions under which they may be fished. - (possibly) Proposal for a Council regulation amending Council regulation (EC) No. 3074/95 fixing, for certain fish stocks and groups of fish stocks, the total allowable catches for 1996 and certain conditions under which they may be fished. - (Possibly) Proposal for a Council regulation laying down certain rules for the access to Community waters of research vessels for scientific purposes. - (Possibly) Commission proposal on the financing of collection of scientific data. - (Possibly) Proposal for a Council regulation (EC) amending regulation (EEC) No. 2847/93 establishing a control system applicable to the common fisheries policy (establishment of a Community catch-reporting data-base). - (Possibly) Proposal for a Council decision on MAGP IV. - Proposals for Council regulations a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Norway; b) allocating, for 1997, certain catch quotas between member states for vessels fishing in the Norwegian exclusive zone and the fishing zone around Jan Mayen. - Proposals for Council regulations: a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of the Faroes; b) allocating, for 1997, certain catch quotas between member states for vessels fishing in Faroese waters. - Proposal for a Council regulation allocating, for 1997, Community catch quotas in Greenland waters. - Proposal for Council regulation allocating, for 1997, certain catch quotas between member states for vessels fishing in Icelandic waters. - Proposals for Council regulations: a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Estonia; b) allocating, for 1997, catch quotas between member states for vessels fishing in Estonian waters. - Proposals for Council regulations: a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Latvia; b) allocating, for 1997, catch quotas between member states for vessels fishing in Latvian waters. - Proposals for Council regulations a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Lithuania; b) allocating, for 1997, catch quotas between member states for vessels fishing in Lithuanian waters. - a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Poland; b) allocating, for 1997, catch quotas between member states for vessels fishing in Polish waters. - a) laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of the Russian Federation; b) allocating, for 1997, catch quotas between member states for vessels fishing in Russian waters. - Proposal for Council regulation laying down, for 1997, certain conservation and management measures for fishery resources in the regulatory area as defined in the Convention on future multilateral cooperation in the North West Atlantic Fisheries. - Proposal for a Council regulation laying down, for 1997, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of certain non-member countries in the 200-nautical-mile zone off the coast of the French Department of Guiana. - (Possibly) NAFO: New STACFAC regulations. - Proposals for Council decisions: a) Authorising the Kingdom of Spain to extend the agreement on mutual fishery relations with the Republic of South Africa; b) Authorizing the Portuguese Republic to extend the agreement on mutual fishery relations with the Republic of South Africa. LUXEMBOURG - Executive committee of Schengen group on free movement of people meets at ministerial level under Luxembourg presidency. Venue: Kirchberg conference centre. Luxembourg is hoping to achieve admittance of Nordic countries to Schengen accord during its presidency of the group, with signature of accession protocols for Denmark, Finland and Sweden and association protocols for Iceland and Norway at the meeting. TUESDAY, DECEMBER 23 BRUSSELS - EU institutions closed for Christmas holidays until January 2. TUESDAY, DECEMBER 31 - Irish EU presidency ends. The Netherlands takes over to June 30, 1997. If you have items for inclusion in the Reuter European Community diary, please contact: Telephone: Cynthia Simpson (322) 287 6851 Fax: (322) 230 5573 For technical queries regarding the service, please call (322) 287 6666 - - - - - - - - - - - - - - - - - - - - - - - EC Report (C)opyright Reuters Limited. 3662 !G15 !GCAT THURSDAY, DECEMBER 12 BRUSSELS - Transport Council. Provisional agenda includes: - External relations: - Relations with the United States in the field of air transport. - Recommendation for a Council decision authorising the Commission to open negotiations on air transport agreements between the Community and Bulgaria, the Czech Republic, Hungary, Poland, Romania and Slovakia. - Negotiations between the European Community and Switzerland on land and air transport. - Other measures: - (possibly) Follow-up to green paper on the citizens' network. - (possibly) Follow-up to green paper on internalisation of external costs. - (possibly) Proposal for an European Parliament and Council directive on summertime arrangements. - Surface transport: a) Rail transport: - (possibly) Follow-up to the white paper on the future of the railways. b) Road transport: - (possibly) Access to the road haulage profession. - (possibly) Taxation of goods vehicles to replace directive 93/89/EEC. - Proposal for a Council regulation laying down the conditions under which non-resident carriers may operate national road passenger transport services within a member state. - Proposal for a Council regulation amending Council directive and regulation on recording equipment in road transport. - Proposal for a Council regulation (EEC) No 684/92 on common rules for the international carriage of passengers by coach and bus. - Air transport: - Follow-up to white paper on air traffic management. - (possibly) Follow-up to high level group on air safety. - Proposal for the establishment of a single European authority for air safety. - (possibly) Proposal on airport charges. - Proposal for a Council regulation on air carrier liability in case of accidents. - (possibly) Revision of regulation on slot allocation. - (possibly) Proposals to update rules on denied boarding compensation and passenger protection. - Maritime transport: - (possibly) Licensing regime for roll-on roll-off ferry operations. - (possibly) Compiling lists of passengers on roll-on roll-off ferries. - Proposal for Council directive setting up a harmonised safety regime for fishing vessels of 24 metres in length and over. - (possibly) Commission strategic document. - (possibly) Proposal to amend Council directive 94/58/EC on the minimum level of training of seafarers. - (possibly) Proposal to amend Council directive 93/75/EEC concerning minimum requirements for vessels bound for or leaving Community ports and carrying dangerous or polluting goods. - (possibly) Shipping agreements with third countries, especially China and India. - (possibly) Report on competition in the multimodal sector. FRIDAY, DECEMBER 13 DUBLIN - Irish presidency hosts European Council of heads of state and government (To December 14). Provisional agenda includes: - Council report on the development of tax systems within the Union, taking into account the need to create a tax environment that stimulates business and the creation of jobs and promotes a more efficient environmental policy. - Commission and European Monetary Institute (EMI) report on progress in stage three of European Monetary Union (EMU). - Commission report on subsidiarity. - Presentation of draft revision of the treaties, addressing in particular: * Bringing the Union closer to its citizens; * Strengthening and enlarging the scope of the Union's common foreign and security policy; * Assuring, in view of enlargement, the proper functioning of the institutions while respecting their balance of powers and the efficiency of the decision-making process; * Simplification of the treaties. - Commission report on appropriate initiatives for reinforcing regional cooperation in Europe. - Report on the evolution of the trade policies and the preferential agreements of the Community in relation to the World Trade Organisation (WTO). - Final European Commission report on the mutually beneficial effects of greater coordination of the Union's economic and structural policies. - Review of December 1995 Madrid summit recommendations on fighting unemployment and on application of multiannual employment programmes. - Joint ECOFIN/Social Affairs Council annual employment monitoring report. - Review of progress in application of Madrid December 1995 drug experts group report on the fight against drugs. - Territorial pacts for employment within the framework of the confidence pact for employment. END OF DOCUMENT. 3663 !G15 !GCAT THURSDAY, DECEMBER 5 BRUSSELS - Research Council. Provisional agenda includes: - Financial supplement to the fourth framework programme/task force. - Action plan on follow-up to the green paper on innovation. - Fifth RTD framework programme. - Presidency initiative on the contribution of research to drug detection and prevention of abuse. - International cooperation in the RTD field: - Science and technology cooperation strategy with central and eastern European countries; - (possibly) Bilateral S/T agreements with several third countries. - Commission communication on the EU and space. - Commission communication on agronomic research for development. - SMEs. - (possibly) Fusion: - ITER; - Evaluation report from the Commission on the fusion programme. - High flux reactor (HFR) programme. CASABLANCA - Euro-Mediterranean summit of industrial federations. FRIDAY, DECEMBER 6 BRUSSELS - General Affairs Council. Provisional agenda includes: - Preparation of Dublin European Council. - Discussion of 53rd U.N. Commission on human rights (including definition of EU position on China). - Approval of policy document on peacekeeping operations. - Submission of report on European armaments policy. - Adoption of common position on U.N. register of conventional arms. - Former Yugoslavia. - Middle East. - Mediterranean policy: - Report on the follow-up to the Barcelona Conference; - Algeria and Egypt: decision to sign agreements; - Syria: Commission proposal for a negotiating mandate. - Preparation of EEA ministerial council. - Internal financial regulation on ACP. - Radiation protection of persons undergoing medical examination or treatment. - Negotiating directives for a nuclear cooperation agreement between EURATOM and Japan. - Approval of mandate to negotiate an agreement on wine with Slovakia, Slovenia and the Czech Republic. - Agreement on steel with central and eastern European countries. - Approval of negotiating mandate for a partnership and cooperation agreement with Turkmenistan. - Asia: - Decision to sign a protocol relating to the accession of Vietnam to ASEAN; - Preparation for EU-ASEAN ministerial (February 1997); - Follow-up to Bangkok ASEM and preparation for Singapore ministerial. - Decision to sign framework agreement with Australia. - Decision to sign mutual recognition agreements with Australia and New Zealand. - Decision on signature of free trade agreement with South Africa. MONDAY, DECEMBER 9 SINGAPORE - Inaugural World Trade Organisation (WTO) ministerial conference (To December 13). Provisional agenda includes: - Review of the implementation of Uruguay Round commitments. - Endorsement of results of negotiations on services. - Report from the committee on trade and environment. - Any other trade-related issues. BRUSSELS - Environment Council (To December 10). Provisional agenda includes: - Proposal for a decision of the European Parliament and of the Council on the review of the European Community programme of policy and action in relation to the environment and sustainable development "Towards sustainability". - Proposal for a Council directive amending directive 90/219/EEC on the contained use of genetically modified micro-organisms. - Auto oil: a) Draft directive relating to the quality of petrol and diesel fuels; b) Draft directive on measures against air pollution by emissions from motor vehicules - amendment of directives 70/229//EEC and 70/156/EEC. - Proposal for a Council directive concerning the quality of water intended for human consumption. - Commission communication on waste policy. - Proposal for a Council regulation amending Council regulation (EEC) No 3254/91 prohibiting the use of leghold traps in the Community and the introduction into the Community of pelts and manufactured goods of certain wild animal species originating in countries which catch them by means of leghold traps or trapping methods which do not meet international humane trapping standards. - Proposal for a Council regulation establishing common rules and procedures to apply to the shipments to certain non-OECD countries of certain types of waste. - Follow-up to the conference on climate change. - Fifth session of the Commission on sustainable development. STRASBOURG - European Parliament plenary session (To December 13). END OF DOCUMENT. 3664 !G15 !GCAT WEDNESDAY, NOVEMBER 27 BRUSSELS - European Parliament mini-session (To November 28). VENICE - Second ministerial conference on the management of fish stocks in the Mediterranean (To November 29). THURSDAY, NOVEMBER 28 BRUSSELS - Justice and Internal Affairs Council (To November 29). BRUSSELS - Telecoms Council. Provisional agenda includes: - Telecommunications terminal and satellite earth station equipment. - TENs: Proposal for a European Parliament and Council decision on a series of guidelines for trans-European telecommunications networks. - Data protection: modified proposal for a directive of the European Parliament and of the Council concerning the processing of personal data and the protection of privacy in the telecommunications sectors, in particular in the integrated services digital network (ISDN). - (possibly) Numbering. - (possibly) ONP voice telephony. - (possibly) Proposal for a Council decision on inter-administration telematic networks for statistics relating to the trading of goods between member states (EDICOM). - Proposal for a European Parliament and Council directive on interconnection in telecommunications. - Update of framework and leased lines directives on open network provision (ONP). BRUSSELS - European Commission and the Indian government hold joint forum on trade and investment in India. BRUSSELS (NEW ITEM) - European Institute for Asian Studies (EIAS) hold conference on "EU-Asia cooperation in the WTO context" (To November 29). Main discussions focus on how and to what extent Asians and Europeans can cooperate in opening up markets within the WTO. Speakers include: European Commissioner Sir Leon Brittan. Contact: EIAS, Kerstin Bergloef (322) 230 8122. BRUGES, Belgium - European Society of Transport Institutes (ESTI) holds conference on "The citizens' network" (and 29/11). Topics discussed include: the implications of external costs principles on urban transport; the network benefits principles; the modernising of the regulatory framework in public transport. Venue: Castle Prinsenhof. Contact: Laetitia Hoste, ESTI (322) 230 0514. LEIPZIG, Germany (NEW ITEM) - Verband Saechssicher Bildungsinstitute hold conference on "Education 2000" (To November 30). Topics include: the European education market; training in the latest skills; multimedia ability for both suppliers and users; innovation through personal development. Contact: Verband Saechssicher Bildungsinstitute, Dieter Webner (49) 341 490 5910. LONDON - Agra Europe holds fifth annual European sugar, sweetners and starch conference (to November 29). Contact: Agra Europe (44) 1892 511 807. FRIDAY, NOVEMBER 29 BRUSSELS - European Parliament hosts conference on "Europe and its nations - before Maastricht II". Participants include: European Commission President Jacques Santer and Belgian Prime Minister Jean-Luc Dehaene. MONDAY, DECEMBER 2 BRUSSELS - ECOFIN Council. Provisional agenda includes: - Preparation for December 13-14 Dublin European Council: - Commission report on the coordination of the Community's economic and structural policies. - EIB loans to third countries. - Taxation issues. - SEM 2000 (sound and efficient management) final report of personal representatives group. - (possibly) Protection of the financial interests of the Community: - Monitoring of national measures; - Extension of administrative controls and sanctions. BRUSSELS - Social Affairs Council. Provisional agenda includes: - Follow-up of the Essen European Council: draft single report to the European Council of Dublin. - Directive proposal on posting of workers in the framework of services. - Proposal for a directive on the burden of proof in sex discrimination cases. - Proposal for a directive modifying directive 76/207/EEC (Kalanke European Court of Justice judgment). - Amendment to regulation on civil servants and students (social security for migrant workers). - Proposed regulation on modification of regulations (EEC) 1408/71 and 574/72 (social security of migrant workers: beneficiaries of pre-retirement benefits). - Proposed regulation on various modifications of the regulations on social security for migrant workers. - (possibly) Proposed regulation on codification of the regulations on social security for migrant workers. - (possibly) Draft resolution on lifelong learning. - Draft resolution on the future of social protection. LISBON - Statistics Office of the European Community (SOEC) holds summit. TUESDAY, DECEMBER 3 BRUSSELS - Energy Council. Provisional agenda includes: - Proposal for a directive concerning common rules for the internal market in electricity. - Proposal for a directive concerning common rules for the internal market in gas. - White paper on energy: Community strategy on renewables. - Proposal for a decision on ALTENER II. - White paper on energy: proposal for a decision on analysis and forecasts. - Proposal for a decision on SAVE II programme. - Proposal for a directive on energy efficiency requirements for households: electric refrigerators, freezers and combinations thereof. - Proposal for a regulation on a SYNERGY programme. - Report on the situation of oil supply, refining and markets in the European Community. - Proposal for a directive to introduce rational planning techniques in the electricity and gas distribution sectors. - Proposal for a decision on the conclusion of the Energy Charter Treaty. - Euro-Mediterranean conference. - Revision of Community law in the energy sector. WEDNESDAY, DECEMBER 4 LONDON (NEW ITEM) - Financial Times (FT) hold conference on "Venture '96 Europe" (To December 6). Main topics discussed: overview of venture capital and buyouts markets in Europe; update on eastern Europe; fund raising for European investments; technology-a hot investment sector; mezzanine and senior debt-a look at availability and terms; managing the European portfolio; deal flow channels; exit and IPO markets in Europe. Contact: FT conferences (44) 171 896 2626. END OF DOCUMENT. 3665 !G15 !GCAT FRIDAY, NOVEMBER 22 BRUSSELS - Development Council. Provisional agenda includes: - First ministerial exchange of views on ACP/EU relations post-Lome IV (Commission green paper). - Further exchange of views on relief, rehabilitation and development. - Resolution on the forestry sector. - Adoption of a common position on the regulation on north/south cooperation in the fight against drugs. - Adoption of a common position on the regulation on aid for population policies and programmes. - Approval after EP second reading of the regulations on rehabilitation and construction in developing countries, refugees in Asia and Latin America, environmental measures in developing countries and HIV/AIDS related operations in developing countries. - Horizon 2000 - coherence, complementarity and coordination. BRUSSELS - Fisheries Council. Provisional agenda includes: - Proposal for Council regulations (EC) fixing: - The guide prices for the fishery products listed in Annex I (A), (D) and (E) of Regulation (EEC) No. 3759/92 for the 1997 fishing year; - The guide prices for the fishery products listed in Annex H to Regulation (EEC) No. 3759/92 for the 1997 fishing year; - The Community producer price for tuna intended for the industrial manufacture of products falling within CN code 1604 for the 1997 fishing year. - Proposal for a Council regulation (EC) temporarily suspending totally or partially the autonomous duties of the Common Customs Tariff for certain fishery products (1997). - (Possibly) Proposal for a Council Regulation laying down (new) technical measures for the conservation of fishery resources. - (Possibly) Proposal for a Council decision on MAGP IV. - Commission report on third countries' activities in Community waters. - Proposals for a Council regulation on the conclusion of the protocol establishing the fisheries rights and financial compensation provided in the agreement between the European Economic Community and the government of Senegal. - (Possibly) Conclusion of new fisheries agreements with: a) Certain countries of South America; b) South Africa; c) Namibia; d) Mozambique. MONDAY, NOVEMBER 25 BRUSSELS - General Affairs Council (To November 26). In margins of the Council, EU/African Unity Organisation ministerial meeting. Provisional agenda includes: - Preparation for Dublin European Council. - Transatlantic relations. - Preparation for December WTO ministerial meeting. - Middle East. - Mediterranean policy: - Status report on contacts with Syria; - Middle East (post-Cairo summit). - Albania: decision to sign a new accord. - Relations with Turkey. - Former Yugoslavia. - Decision to sign trade and cooperation agreement with FYROM. - Nigeria: renewal of sanctions. - Biological and toxin weapons convention: approval of statement on the opening of the fourth review conference. - Ratification of chemical weapons convention: statement welcoming ratification. - Determination of EU position for structured dialogue with Cyprus and Malta. - Conclusion of negotiations on framework agreement with Australia. - Relations with central and eastern European countries: - Approval of conclusion of Europe agreements with Baltic States; - Approval of interim protocols to Europe agreements. - Russia: review of action plan. - Food aid for Central Asian Republics. - Status of negotiations with South Africa. - Preparation for OSCE conference, Lisbon. BRUSSELS - Consumers Council. Provisional agenda includes: - Commission proposal on access to justice (injunctions). - Commission communication on access to justice (settlement). - Directive amending existing consumer credit directives. - Commission green paper on commercial communications in the internal market. - Commission green paper on financial services meeting consumers' expectations. - Guarantees and after sales services. - Consumer protection within the information society. - Protection of vulnerable and disadvantaged consumers. - Continuation of consumer education theme. BRUSSELS - Brussels institute for management of the environment (IBGE), European federation of regional energy and environment agencies (FEDARENE) and Eurocities hold joint conference on "Plans and strategies for waste management on regional and local level" (0900/0800 GMT). Venue: General de Banque auditorium. Contact: IBGE by fax (322) 775 7679. TUESDAY, NOVEMBER 26 BRUSSELS - Internal Market Council. Provisional agenda includes: - (possibly) 1996 study of the impact and effectiveness of single market legislation. - Simpler legislation for the internal market (SLIM). - Directive on legal protection of designs and industrial models. - (possibly) 16th amendment of the directive 76/769/EEC on the marketing and use of certain dangerous substances and preparations. - Citizens First initiative. - Directive concerning the free movement of lawyers. - European company statute. - (possibly) Directive concerning the free movement of doctors. - Proposal for a directive amending directive 93/7/EEC concerning the return of cultural objects unlawfully removed from the territory of a member state. - (possibly) Proposal for a directive on the supplementary supervision of insurance undertakings in an insurance group. - Amendments to directive 89/398/EEC - dietary foods: a) Vertical directives; b) Temporary authorization; - Amendments to directive 2/95/EEC - miscellaneous additives: a) Prohibition of use in traditional products; b) Classification of processed euchema seaweed. - Amendment to sweeteners directive 94/35/EEC. - In-vitro medical diagnostic devices. - Amending public procurement directives following the adoption of G.P.A. - (possibly) Green paper on public procurement. LUXEMBOURG - European Commission DG XI hosts standing conference on "Health and safety in the nuclear age: informing the public on European radiation standards" (1030/0930 GMT) (and 27/11). Topics include: major changes in the Euratom basic safety standards directive. Venue: Jean Monnet building, room M6. Contact: Mrs Eisen, DG IX (352) 4301 33 164. BRUSSELS - Economic and Social Committee (ECOSOC) holds plenary session (to 28/11). DUBLIN - European Finance Convention holds tenth anniversary meeting (to 30/11). Contact: (44) 171 381 9291. END OF DOCUMENT. 3666 !G15 !GCAT TUESDAY, NOVEMBER 12 BRUSSELS - Health Council. Provisional agenda includes: - Proposal for an EP and Council decision adopting a programme of Community action on the prevention of drug dependence within the framework for action in the field of public health. - Proposal for a decision adopting a programme of Community action on health monitoring in the context of the framework for action in the field of public health. - Proposal for a Council directive on the approximation of the laws, regulations and administrative provisions of the member states relating to the advertising of tobacco products. - Proposal for a decision of the European Parliament and of the Council creating a network for the epidemiological surveillance and control of communicable diseases in the European Community. - Setting-up of an EU-U.S. task force to develop and implement a global early warning system and response network for communicable diseases. - (possibly) Transmissible Spongiform Encephalopathies (TSE). - Blood safety/self sufficiency. - State of health in the EU. - Health protection requirements in Community policies. - European health card. - Pollution-related diseases: - Rare diseases; - Accidents/injuries. - Statement by presidency on Alzheimers Disease conference (November 21-22, 1996). WEDNESDAY, NOVEMBER 13 BRUSSELS - Committee of the Regions holds plenary session (To November 14). BRUSSELS - EuroCommerce launches the business of adding value, an analysis of European retail and distribution based on a study by London economics, and the EuroCommerce recommendations for future policy in recognition of the vital importance of this sector to th European economy (1030/0930 GMT). Venue: International Press Centre (IPC). Contact: Catherine Piana (322) 230 5 874. BRUSSELS - Agra Europe holds third annual European grain conference (To November 14). Contact: Agra Europe (44) 1892 511 807. THURSDAY, NOVEMBER 14 BRUSSELS - Industry Council. Provisional agenda includes - Steel: a) State aids code; b) Sixth monitoring report on state aids in steel sector; c) (possibly) Future of ECSC Treaty. - Competition: a) State aids; b) Merger regulation; c) Agreement with Canada. - Shipbuilding: - (possibly) State of ratification procedure - OECD agreement. - SMEs: a) Proposal for a Council decision on a third multiannual programme for small and medium sized enterprises (SMEs) in the European Union (1997-2000); b) Report on integrated programme. - Competitiveness policy: a) Commission's first report on the competitiveness of European industry; b) A European policy for quality promotion; c) Benchmarking; d) Standards. - Merger regulation: - Review of regulation 4064/89 on the control of concentrations between undertakings. - Automobile industry. - Chemicals industry. - Textiles: - Communication from the Commission on the competitiveness of subcontracting in the textile and clothing industry in the European Union. - (possibly) Recycling industry and environmental technology. - (possibly) Space industry. - (possbly) Cooperation with third countries. BRUSSELS - EuroCommerce holds conference on "The business of adding value - European retailing and distribution". Main discussions focus on commerce in the cashless society and the challenges of multimedia. European Commission President Jacques Santer attends. Contact: Catherine Piana (322) 230 5874. SUNDAY, NOVEMBER 17 QATAR - European Commission DG XVII and the Cooperation Council for the Arab States of the Gulf (GCC) hold joint conference on "EU-GCC: extending the partnership to natural gas" (and 18/11). MONDAY, NOVEMBER 18 BRUSSELS - Farm Council (To November 19). TUESDAY, NOVEMBER 19 BRUSSELS - Budget Council. Provisional agenda includes: - Draft Community budget for 1997 (second reading). BRUSSELS - Euro-Mediterranean Committee for the Barcelona process meets (To November 20). LONDON - Agra Europe holds ninth annual European and international dairy conference "Dairy '96" (To November 20). Contact: Agra Europe (44) 1892 511 807. BRUSSELS - Forum Europe, UNICE, the European Round Table of Industrialists (ERT), Eurochambres, the EU Committee of AmCham, the European Automobile Manufacturers Association (ACEA) and the European Chemical Industry Council (CEFIC) hold one-day conference (0930/0830 GMT) on "Europe's competitive edge". Main topic is: assessing the state of EU competitiveness, an agenda for future action. Main speaker is Martin Bangemann, Member of the European Commission with responsibility for Industrial Affairs, Information and Telecommunications technologies. Venue: Concert Noble, rue d'Arlon 82, 1040 Brussels. Contact: Clare Richardson, Forum Europe (322) 736 1430. THURSDAY, NOVEMBER 21 BRUSSELS - Education/Youth Council. Provisional agenda includes: - Proposal for a decision on TEMPUS II. - Conclusions on school effectiveness. - European year of lifelong learning. - Green paper on obstacles to mobility in higher education. - Proposal for a recommendation concerning the assessment of quality in higher education. - White paper on teaching and learning: towards the learning society. - In-career development for teachers. - (possibly) "SOCRATES" programme: draft decision amending the Socrates decision. - Quality of higher education. - General assessment of first and second level education systems. - Commission proposal for a Council recommendation on the transferability of grants. - Preparation of the structured dialogue with counterparts from central and eastern European countries. END OF DOCUMENT. 3667 !G15 !GCAT MONDAY, OCTOBER 28 LUXEMBOURG - General Affairs Council (To October 29). Provisional agenda includes: - Preparation for December WTO ministerial meeting. - Mediterranean policy: - Status report on negotiations with Egypt and Algeria; - Decision on signature of agreements with Jordan and Lebanon; - Preparation for EU political profile at Cairo Summit (November 12-14). - Middle East. - Former Yugoslavia. - Ukraine action plan. - OSCE - Proposed guidelines for review and summit. - Determination of EU's position for structured dialogue with central and eastern European countries. - Commission presentation of green paper on post-Lome scenario. - Relations with South Africa; state of negotiations. - Relations with Switzerland. - Interpretation and implementation of European Council common criteria to be applied to arms exports. - Status of negotiations on framework agreement with Australia. - Structured dialogue with central and eastern European countries. - Signature of new partnership accords with Jordan and Lebanon. - Signature of a framework accord with Korea. - IGC ministerial session (first day). LUXEMBOURG - Farm Council (To October 29). BRUSSELS - Second European forum for social partners on services of general interest (To October 29). Agenda includes: role and missions of services of general interest in achieving the goals of the EU and guaranteeing the fundamental rights of its residents and citizens; role of the actors (public authorities, operators, consumers, employees); subsidiarity, regulation, control, evaluation; globalisation and European strategy towards third countries. Venue: Palais des Congres. Contact: First & Top Travel - L'Universelle Travel Group (322) 647 4935. TUESDAY, OCTOBER 29 BRUSSELS - Economic and Social Committee (ECOSOC) holds plenary session (To October 31). WEDNESDAY, OCTOBER 30 BRUSSELS - EU senior officials meet in the framework of the Euro-Mediterranean partnership on political and security questions (To October 31). PARIS - Euroforum holds conference on "Gas and electricity '96 - deregulation: what is the impact?" (To October 31). Venue: Pavillon Royal, Bois de Boulogne. Contact: Alexandra Galeza (33) 1 44 88 14 98. THURSDAY, OCTOBER 31 MARRAKESH, Morocco - Prometheus-Europe holds conference on "Articulate the Euro-Mediterranean partnership and decentralised cooperation" (To November 1). Topics include: the objectives of the Euro-Mediterranean partnership; the functioning of the EMP - circuits of decision-making, financial control and the MEDA regulation; the functioning of Euro-Mediterranean programmes in the context of decentralised cooperation. Contact: Euro-Med (33) 1 43 43 03 07. NOVEMBER - Irish presidency hosts conference on "Local employment initiatives". Date and venue to be announced. VENICE, Italy - Conference on fish management in the Mediterranean. Date to be confirmed. FRIDAY, NOVEMBER 1 BRUSSELS - EU institutions closed for All Saints Day holiday. MONDAY, NOVEMBER 4 EUROPEAN UNION - 1996 European Telework week begins (To November 11). The aim is to raise awareness of the business and work opportunities presented by telework and to provide opportunities to understand and use telework technologies. Contact: Horace Mitchell (44) 1 635 253 802. VIENNA - Third European assembly on telework and new ways to work (To November 6). Main topics discussed are: getting people to work; training for life in the information society and working towards sustainability. Contact: Josef Hochgerner (43) 1 4950 442 42. TUESDAY, NOVEMBER 5 BRUSSELS - European Transport Safety Council (ETSC) holds conference on "Low-cost/high-return engineering measures for road accident reduction". Contact: ETSC (322) 230 4106. BRUSSELS - CENELEC holds conference on "Standards on trial: case studies in European standardisation" (To November 6). Venue: Sheraton Hotel. Contact: Annick Colman, CENELEC (322) 519 6889. THURSDAY, NOVEMBER 7 BRUSSELS - Culture Council. Provisional agenda includes: - (possibly) Debate on European funds promoting cinema and television production. - Directive amending the television without frontiers directive. - Decision establishing an audiovisual guarantee fund. - Proposal for a directive harmonising rules on media concentrations. - Decision on Ariane programme. - Decision on Raphael programme. - First Commission report on consideration of cultural aspects of EU action. - Proposal for a decision on rules concerning the European city of culture after the year 2000. - (possibly) Green paper on new audiovisual services. - Proposal for a directive amending directive 93/7/EEC concerning the return of cultural objects unlawfully removed from the territory of a member state. CORK, Ireland - European Commission hosts European conference on "Rural development" (To November 9). Discussions will focus on the future perspectives for the Union's rural development policy. This policy seeks to address the challenges faced by rural areas in a way that considers all economic sectors and aspects of rural life and builds on their strengths. BRUSSELS - European Trade Union Confederation (ETUC) holds conference on "Social protection" (To November 8). Contact: ETUC (322) 224 0411. FRIDAY, NOVEMBER 8 CHICAGO - TransAtlantic Business Dialogue (TABD NEWS) holds conference (To November 9) to discuss transatlantic trade relations and develop creative solutions to remaining barriers to transatlantic trade. Speakers are: US Commerce Secretary Mickey Kantor, European Trade Commissioner Sir Leon Brittan and European Industry Commissioner Martin Bangemann. Contact: Stephen Johnston, EU Contact Point (322) 548 0693. MONDAY, NOVEMBER 11 BRUSSELS - ECOFIN Council. Provisional agenda includes: - Preparation for December 13-14 Dublin European Council: - EMU; - Employment; - Report on taxation; - (possibly) Banking and financial directives; - Taxation issues. STRASBOURG - European Parliament plenary session (To November 15). END OF DOCUMENT. 3668 !G15 !GCAT TUESDAY, OCTOBER 15 LUXEMBOURG - Environment Council. Provisional agenda includes: - Proposal for a decision of the European Parliament and of the Council on the review of the European Community programme of policy and action in relation to the environment and sustainable development "Towards sustainability". - Proposal for a Council regulation amending Council regulation (EEC) No 3254/91 prohibiting the use of leghold traps in the Community and the introduction into the Community of pelts and manufactured goods of certain wild animal species originating in countries which catch them by means of leghold traps or trapping methods which do not meet international humane trapping standards. - (possibly) Follow-up of the conference on climate change and preparation of EU position for protocol negociations. - Preparation for the conference on biodiversity. - Preparation for the eighth meeting of the parties to the Montreal protocol on substances that deplete the ozone layer. - (possibly) Commission communication on waste strategy. - Proposal for a Council directive amending directive 90/219/EEC on the continued use of genetically modified micro-organisms. - Proposal for a Council directive concerning the quality of water intended for human consumption. - Auto oil: a) Draft directive relating to the quality of petrol and diesel fuels; b) Draft directive on measures against air pollution by emissions from motor vehicules - amendment of directives 70/229/EEC and 70/156/EEC. WEDNESDAY, OCTOBER 16 BRUSSELS - Centre for European Policy Studies (CEPS) holds seminar on "Water, politics and security in the Mediterranean Region" (0915/0715 GMT). Venue: Place du Congres 1. Contact: Shireen Hunter, CEPS (322) 229 3911. THURSDAY, OCTOBER 17 LUXEMBOURG - Executive committee of Schengen group on free movement of people meets at ministerial level under Luxembourg presidency. Venue: Kirchberg conference centre. Luxembourg is hoping to achieve admittance of Nordic countries to Schengen accord during its presidency of the group, with signature of accession protocols for Denmark, Finland and Sweden and association protocols for Iceland and Norway at December 19 meeting. SATURDAY, OCTOBER 19 DUBLIN (NEW ITEM) - (TENTATIVE) European Union leaders hold an extra summit to discuss a wide range of issues including trade, drugs and the EU's future. Agenda likely to include the IGC, employment and social protection, the fight against drugs, and preparations for the December ministerial meeting of the World Trade Organisation in Singapore. SUNDAY, OCTOBER 20 FINLAND - Finland holds municipal elections and the first elections to the European Parliament on the same day. VILNIUS (NEW ITEM) - Parliamentary elections in Lithuania. TIRANA (NEW ITEM) - Albania holds local elections; all parties, including those which withdrew from the controversial general election, have agreed to participate in the local vote. *** MONDAY, OCTOBER 21 STRASBOURG - European Parliament plenary session (To October 25). TUESDAY, OCTOBER 22 STRASBOURG - Confederation of European Paper Industries (CEPI) holds conference on "Forest management and paper: growing cooperation". Contact: CEPI (322) 627 4911. THURSDAY, OCTOBER 24 LUXEMBOURG - Tourism Council. Provisional agenda includes: - Commission report on the evaluation of the Community's action plan to assist tourism (1993-1995). - Proposal for Council decision on a first multiannual programme to assist European tourism (1997-2000) "PHILOXENIA". - (possibly) Report by the Commission on the situation regarding travel guides and ski instructors in the EU. MADRID - European Investment Bank (EIB) holds forum on "The Mediterranean: a space for partnership" (1500/1300 GMT) (To October 25). Agenda includes: - The Mediterranean, a common destiny: - The EU's Mediterranean policy: from cooperation to partnership; - The sea, water and cities: preserving a common heritage. - An area for joint development: - The dynamic role of trans-national projects; - The banking sector and north-south partnership. Speakers include: EIB President Sir Brian Unwin; European Commissioner for Relations with the Mediterranean Manuel Marin; MEP Willy de Clercq; Egyptian Minister of State for Economic Affairs Youssef Boutros-Ghali; Greek Deputy Foreign Minister George Romeos; Jordanian Planning Minister Rima Khalaf; Barcelona Mayor and EU Committee of the Regions President Pasqual Maragall. Contact: Yvonne Berghorst, EIB (352) 4379 3154. FRIDAY, OCTOBER 25 LUXEMBOURG - Internal Market Council. Provisional agenda includes: - Operation of the internal market: - Oral report of the Commission including progress report on the SLIM initiative; - Administrative cooperation; - Transposition. - Citizens first. - Preparation for structured dialogue with central and eastern European countries: - White paper on approximation of the laws of central and eastern European countries in the field of the internal market. - Three proposed directives concerning the free movement of persons: a) elimination of controls on persons crossing internal frontiers; b) abolition of restrictions on movement and residence within the Community; c) (possibly) the right of third-country nationals to travel in the Community. - Proposal for a directive on pluralism and media concentration. - The "Robert Schuman" action. - Transparency mechanism for national regulations concerning the information society. SUNDAY, OCTOBER 27 - European summer time ends - Central European time changes from GMT +2 to GMT +1. SOFIA (NEW ITEM) - Bulgaria holds its second post-communist presidential election. END OF DOCUMENT. 3669 !G15 !GCAT TUESDAY, OCTOBER 8 LUXEMBOURG - Industry Council. Provisional agenda includes: - Implications of the information society for EU policies. - Review of the action plan "Europe's way to the information society". - Member state experiences. - The information society and services for industry. - Standardisation and the information society. - Information society and the citizen. - (possibly) Multilingual information society. - (possibly) The information society and space. - Green paper on the social aspects of the information society. BRUSSELS - Euro-Mediterranean committee for the Barcelona process meets (To October 9). GALICIA, Spain - European Commission's DG XVI, Committee of the Regions and Galicia hold seminar on land-use planning in the Atlantic Arc region. LONDON - Agra Europe holds third annual European meat industry conference "Meat '96". Topics include: EU policy for meat and livestock; EU policy, European meat producation and trade - perspectives from UK and Germany; market outlook for beef, sheepmeat, pigmeat and poultry; BSE and the effects on European meat consumption; rebuilding the image of meat; regaining consumer confidence. Venue: Copthorne Tara Hotel. Contact: Agra Europe (44) 1892 51 18 07. THURSDAY, OCTOBER 10 BRUSSELS - Cogen Europe holds third annual conference on "Europe's cogeneration markets of the future: prospects and challenges" (To October 11). Venue: Sheraton Hotel. Contact: Cogen Europe (322) 772 8290. FRIDAY, OCTOBER 11 BRUSSELS - European Institute for Asian Studies (EIAS) holds conference on "APEC and the EU". Main discussions focus on what APEC is, what it actually does and what it means for EU policy makers and business. Contact: EIAS, Kerstin Bergloef (322) 230 81 22. SUNDAY, OCTOBER 13 AUSTRIA - Austria holds its first elections to the European Parliament, electing 21 deputies. MONDAY, OCTOBER 14 LUXEMBOURG - ECOFIN Council. Provisional agenda includes: - EMU third stage: preparation for Dublin European Council. - European Investment Bank (EIB) loans to third countries: - New guarantee system; - Renewal of envelopes for eastern Europe, the Mediterranean and ALA. - Protection of the Community's financial interests: regulation on on-the-spot checks and inspections (final adoption). - Fight against fraud: transit sector. - Taxation issues. LUXEMBOURG - Fisheries Council. Provisional agenda includes: - Proposal for a Council regulation laying down (new) technical measures for the conservation of fishery resources. - Proposal for a Council regulation on logbooks and landing declarations. - (possibly) Commission report on direct landing of fish. - Commission report on fishing and responsible marketing. - Proposal for Council regulation fixing the conditions of access to waters and resources of the Baltic Sea. - Proposal for a Council decision on Multi-Annual Guidance Programme (MAGP) IV. - (possibly) Proposal for a Council regulation on the fixing of management objectives and strategies for certain fisheries for the period 1994-1997. - (possibly) Proposal for a Council regulation amending for the sixteenth time regulation (EEC) No. 3094/86 laying down certain technical measures for the conservation of fishery resources (drift-nets). - (possibly) Proposal for a Council regulation amending previous Council regulations opening and providing for the administration of autonomous Community tariff quotas for certain fishery products (1996) or for tariff suspensions (1996). - (possibly) Proposal for a Council regulation (EC) amending regulation (EEC) No. 2847/93 establishing a control system applicable to the common fisheries policy (establishment of a Community catch-reporting database). - Proposal for a Council regulation (EC) laying down common marketing standards for certain fishery products. - Proposal for a Council regulation introducing transitional measures into regulation (EC) No 1624/94 laying down certain technical measures for the conservation of fishery resources in the Mediterranean. - (possibly) Proposal for a Council regulation (EC) amending regulation (EEC) No. 2847/93 establishing a control system applicable to the common fisheries policy (satellite monitoring). - Commission report on the application of the basic regulation (No. 3760/92). - (possibly) Proposal for Council regulation (EC) amending for the fourth time regulation (EEC) No 3699/93 laying down the criteria and conditions for Community structural funding in the fishing and aquaculture sector as well as the processing and marketing of their products. - (possibly) Commission report on control operations in 1995. - (possibly) Commission report on MAGP III. - (possibly) Conclusion of new fisheries agreements with: a) Estonia; b) Latvia; c) Lithuania. - (possibly) Venice conference on marine management in the Mediterranean, November 1996 - final arrangements. - (possibly) Negotiating mandate for future South Atlantic Fisheries Organisation (SAFO). - (possibly) Proposal for Council decisions on the conclusion of the agreement in the form of an exchange of letters concerning the provisional application of the protocol setting out the fishing opportunities and financial contribution provided for in the agreements between the European Economic Community and: a) Angola; b) Sao Tome; c) Gambia; d) Mauritius. - (possibly) Proposals for the conclusion of a new fisheries agreement with Mauritania. - (possibly) Conclusion of fisheries agreements with Russia on behalf of: a) Sweden; b) Finland. - Recommendations for a Council decision authorising the Commission to negotiate fisheries agreements with certain Mediterranean countries. - Commission report on third countries' activities in Community waters. LILLE, France - European Commission (DG VII-transport, XI-environment, XVII-energy) and Nord-Pas de Calais Region organise congress (To October 16) on "City and mobility; moving ideas around!" . Venue: Alteris, avenue de la Creativite 3, 59650 Villeneuve d'Ascq. Contact: Marianne Ryckewaert (33) 20 67 08 21) CYPRUS - Experts on the implementation of the multiannual rolling work programme for maritime transport in the Mediterranean hold their first meeting. WINDHOEK, Namibia - EU/Southern Africa Development Council ministerial meeting (To October 15). END OF DOCUMENT. 3670 !G15 !GCAT MONDAY, SEPTEMBER 30 BRUSSELS - IGC Working Party of EU foreign ministers' representatives meets to continue review of EU treaties. Topics include: flexibility, follow-up of specific issues in the light of first round of discussions. DUBLIN - People First holds conference on "Challenges of living and working in the European information society" (0830/0630 GMT) (To October 1). Topics include: employment and economic structure in the information society; the future of work in the information society; labour market and learning in the information society; living in the information society. Venue: Dublin Castle. Contact: People First (353) 1 661 8904. TUESDAY, OCTOBER 1 LUXEMBOURG - General Affairs Council (To October 2). Provisional agenda includes: - Preparation for December WTO ministerial meeting. - Mediterranean policy; - MEDA regulation: adoption of the guidelines for the indicative programmes; - Conclusion of negotiations with Jordan and Lebanon; - West Bank and Gaza: Commission proposal for a negotiating mandate. - Relations with Albania: approval of mandate to negotiate a new agreement. - Former Yugoslavia: - Follow-up to electoral process; - Peace process; - Medium/long-term strategy. - Middle East. - Mandate for negotiation of extension of steel agreements with the former USSR. - Relations with central and eastern European countries; decisions of association councils. - Approval to sign supplementary protocols to Baltic FTAs. - India - Council conclusions on Commission communication. - ASEAN - Council conclusions on Commission communication; protocol to ASEAN agreement to take account of Vietnam's accession. - Preparation for SADC ministerial meeting on October 14-15. - Food aid distribution regulation. - Mid-term review of decisions on the association of overseas countries and territories. - Draft joint action on anti-personnel landmines (possible adoption of further joint action). - KEDO (Korean Peninsular Energy Development Organisation). - (possibly) Preparation of the association council with Turkey. - IGC ministerial session. BRUSSELS (NEW ITEM) - European Parliament, Regions and Local authorities hold joint conference designed to improve it's relations with Union's regional and local authorities and to discuss with them how to strenghten democracy and solidarity in the EU (To October 3). Contact: EP fax (352) 4300 2673. BRUSSELS - Touchstone exhibitions and conferences hold conference on "Managing economic transition in central and eastern Europe and central Asia" (To October 3). Venue: Palais des Congres. Contact: Olga Arola, Touchstone exhibitions and conferences (44) 181 332 0044. BRUSSELS - Agra Europe holds conference on "CAP reform 1996-2000 and beyond" (To October 2). Venue: Sheraton Hotel. Contact: Agra Europe (44) 1892 511 807. WEDNESDAY, OCTOBER 2 BRUSSELS - European Trade Union Confederation (ETUC) holds conference on "European works councils" (To October 4). Contact: ETUC (322) 224 0411. THURSDAY, OCTOBER 3 LUXEMBOURG - Transport Council (To October 4). Provisional agenda includes: - External relations: - Recommendation for a Council decision authorising the Commission to open negotiations on air transport agreements between the Community and Bulgaria, the Czech Republic, Hungary, Poland, Romania and Slovakia. - Relationship with central and eastern European countries. - Negotiations between the EU and Switzerland on land and air transport. - Other measures: - Proposal for a European Parliament and Council directive on summertime arrangements. - Surface transport: a) Road transport: - (possibly) Access to the road haulage profession. - (possibly) Taxation of goods vehicles to replace directive 93/89/EEC. - Proposal for a Council regulation laying down the conditions under which non-resident carriers may operate national road passenger transport services within a member state. - Proposal for the modification of Council regulation (EEC) No 684/92 on common rules for the international carriage of passengers by coach and bus. b) Rail transport: - (possbly) White paper on the future of the railways. - Air transport: - (possibly) Follow-up to white paper on air traffic management. - Proposal for a Council regulation on air carrier liabilities in case of accidents. - Proposal for a Council regulation amending regulation EEC/3922/91 on the harmonisation of technical requirements and administrative procedures in the field of civil aviation. - Maritime transport: - (possibly) Proposal on the compilation of lists of passengers on roll-on roll-off ferries. - Proposal for a Council directive setting up a harmonised safety regime for fishing vessels of 24 metres or more in length. - (possibly) Proposal for a Council directive amending Council directive 93/75/EEC concerning minimum requirements for vessels bound for or leaving Community ports and carrying dangerous or polluting goods. - (possibly) Proposal for a Council directive amending directive 94/58/EEC on the minimum level of training for seafarers. LIEGE, Belgium - European Institute for Legal Studies "Fernand Dehousse" holds conference on "Regional trade agreements and multilateral rules after the Uruguay Round: convergence, divergence and interaction" (To October 5). Venue: Palais des Congres. Contact: Xavier Denoel, Liege University (32) 41 66 3156. MONDAY, OCTOBER 7 LUXEMBOURG - Research Council. Provisional agenda includes: - Financial supplement to the fourth framework programme/task forces. - Follow-up to the green paper on innovation. - International cooperation in the research and technological (RTD) development field: - Science and technology cooperation strategy with Mediterranean countries; - (possibly) Bilateral science and technology agreements with several third countries. - Joint Research Centre (JRC): Commission report on progress in the implementation of Council conclusions of April 21, 1994 on the role of the JRC. - Fifth RTD framework programme. - (possibly) Evaluation of Community RTD activities. END OF DOCUMENT. 3671 !G15 !GCAT WEDNESDAY, SEPTEMBER 18 DUBLIN - EU trade ministers hold informal meeting (To September 19) to prepare for the first ministerial conference of the World Trade Organisation (WTO) in Singapore on December 9-13. Participants include: Trade Commissioner Sir Leon Brittan and WTO Director General Renato Ruggiero. Venue: Dublin Castle. BRUSSELS - Committee of the Regions holds plenary session (To September 19). BRUSSELS - Centre for European Policy Studies (CEPS) holds seminar on "Banning chemical weapons" (1315/1115 GMT). Speaker is Ian R. Kenyon, Executive Secretary, Preparatory Commission for the Organisation for the Prohibition of Chemical Weapons. Venue: Place du Congres 1. Contact: CEPS (322) 229 3911. LONDON - AIG conferences Ltd holds "The European power forum: regulatory developments and strategic opportunities" (To September 20). Venue: Park Lane Hotel. Contact: AIG conferences Ltd (44) 171 2422324. THURSDAY, SEPTEMBER 19 BRUSSELS (NEW ITEM) - European Commission hosts "Restpor '96 - Regional Science & Technology Policy Research" conference (To September 21). Discussions focus on a comparative analysis of various regional models of technological innovation as well as on presenting various examples of cooperation and technology transfer among companies, universities, research establishments and public authorities. Contact: DG XII, Mr Mathieu fax (322) 296 0560. BRUSSELS - IBC Legal Studies and Services holds conference on "Telecommunications and EC competition law" (To September 20). Venue: SAS Hotel. Contact: Anna D'Alton, IBC Legal Studies and Services (44) 171 453 2043. FRIDAY, SEPTEMBER 20 DUBLIN - Informal ECOFIN Council (To September 22). SUNDAY, SEPTEMBER 22 KILLARNEY, Ireland - Informal Farm Council (To September 24). Provisional agenda includes beef market trends and sales promotion. MONDAY, SEPTEMBER 23 BRUSSELS - Centre for European Policy Studies (CEPS) holds seminar on "World competition rules" (1315/1115 GMT). Speaker is Karel Van Miert, member of the European Commission responsible for competition policy. Venue: Place du Congres 1. Contact: CEPS (322) 229 3911. TUESDAY, SEPTEMBER 24 BRUSSELS - Social Affairs Council. Provisional agenda includes: - Proposal for a decision on the establishment of an employment and labour market policy committee. - Modification of the "carcinogens" directive. - Amendment of directive 86/378/EEC on equal treatment in occupational social security schemes. - Council resolutions on equal opportunities between men and women and the European structural funds. - Information and consultation of workers. - Future of social dialogue. - Joint report on employment. BRUSSELS - Economic and Social Committee (ECOSOC) holds plenary session (To September 26). LONDON - European Commission hosts conference on "Private security industry in society: a European perspective" (To September 25). Topics include: vocational training, regulation, standards of service and employment. Venue: Forte Crest Hotel. Contact: Nigel Greaves Associates, Andrew Mackay (44) 1886 833 034. BRUSSELS - IGC Working Party of EU foreign ministers' representatives meets to continue review of EU treaties (To September 24). Topics include: issues on which proposals become available from delegations. BRUSSELS - Centre for European Policy Studies (CEPS) holds seminar on "The inter-governmental conference" (1315/1115 GMT). Speaker is Michael Patijn, State Secretary for Foreign Affairs, The Netherlands. Venue: Place du Congres 1. Contact: CEPS (322) 229 3911. WEDNESDAY, SEPTEMBER 25 BERGEN, Norway (NEW ITEM) - NATO defence ministers hold informal meeting (To September 26). THURSDAY, SEPTEMBER 26 DUBLIN - Informal Justice and Internal Affairs Council (To September 27). BERLIN - The Kangaroo Group in collaboration with the Fondation Europe et Societe host European Parliament and Commission conference on "On the way to the European home market: the single currency" (To September 28). Agenda includes: role of the single currency in the development of the EU; priorities of the Irish Presidency regarding the single currency; preparation for the move to the single currency; impact on the French banking system; impact on financial services and policy; impact on business; single currency and social aspects; relations between the single currency and the currencies which will join the EMU later; single currency and political union. Speakers include: MEPs Karl von Wogau, Giorgos Katiforis and Elmar Brok; Irish Finance Minister Ruairi Quinn; European Economy Commissioner Yves-Thibault de Silguy. Venue: Steigenberger Hotel. Contact: Kangaroo Group conference office (322) 284 4438. BRUSSELS - Club de Bruxelles hold conference on "The future of Biotechnologies in Europe" (To September 27). Topics include: development and role of biotechnology R&D in the EU; innovation in health care: novel pharmaceutical products; new crops from plant biotechnology; the "greening" of industry: clean products and processes; biotechnology in Europe society: public perceptions; industrial competitiveness and biotechnological innovation. Contact: Club de Bruxelles (322) 743 1520. WARSAW - Euromoney Seminars holds third annual conference on "The 1996 Polish investment forum" (To September 27). Venue: Bristol Hotel. Contact: Euromoney Seminars (44) 171 7798793. ROME - European Association of Advertising Agencies (EAAA) holds annual conference on "The future of brand-building across borders". Contact: Paola di Discordia, EAAA (322) 280 1603. FRIDAY, SEPTEMBER 27 BRUSSELS - Telecoms Council. Provisional agenda includes: - Proposal for a European Parliament and Council directive on a common framework for general authorisations and individual licences in the field of telecommunications services. - Proposal for a European Parliament and Council decision on action at Union level in the field of satellite personal communications services in the European Union. - (possibly) Commission communication on ITU policy forum. - Proposal for a European Parliament and Council directive on telecoms terminal and satellite earth station equipment. - TENs: proposal for a European Parliament and Council decision on a series of guidelines for trans-European telecommunications networks. - (possibly) ONP voice telephony: proposal for a European Parliament and Council directive. - (possibly) proposal for a Council decision on inter-administration telematic networks for statistics relating to the trading of goods between member states (EDICOM). - (possibly) Draft Council decision on promotion of multilingualism in the information society. - Proposal for a European Parliament and Council directive on common rules for the development of Community postal services and the improvement of quality of service. - (possibly) Proposal for a Council decision regarding the definition and implementation of Community policy in the field of telecommunications and postal services. - (possibly) Health aspects of mobile phones. BRUSSELS - Centre for European Policy Studies (CEPS) holds workshop on "Completing the internal market for electricity: the meaning of the June 20th decision" (1300/1100 GMT). Speakers include MEP Claude Desama. Venue: Place du Congres 1. Contact: CEPS (322) 229 3911. END OF DOCUMENT. 3672 !G15 !GCAT WEDNESDAY, SEPTEMBER 11 BRUSSELS (EXPANDED ITEM) - European Commission holds regular weekly meeting. Provisional agenda, liable to change, includes: - (NEW ITEM) European Commissioner Neil Kinnock presents communication on an internal market in aviation. - European Commission President Jacques Santer presents communication on public services. - European Commissioner Christos Papoutsis presents communication on nuclear industries in the EU - indicative nuclear programme under article 40 of the Euratom treaty COM(96)339. - European Commissioner Martin Bangemann presents communication on the proposal for an EP and Council directive on the application to voice telephony of the principle of open network provision and universal service for telecoms in a competitive environment. - European Commissioner Sir Leon Brittan presents communication on the second phase of the integration of textile and clothing products under GATT. - European Commission President Jacques Santer and European Commissioners Yves-Thibault de Silguy and Mario Monti present communication on the legal framework for the use of the Euro. - European Commission President Santer and European Commissioner de Silguy present communication on Commission proposal on a budgetary stability pact. - European Commissioner de Silguy presents communication on foreign exchange in the EU. LUXEMBOURG - COURT OF FIRST INSTANCE, SECOND CHAMBER - ENLARGED (0930/0730 GMT) - Oral procedure T-227/95 AssiDoman Kraft Products and others v/ Commission: competition. THURSDAY, SEPTEMBER 12 LUXEMBOURG - COURT OF JUSTICE, PLENARY COURT, FIRST CHAMBER (0930/0730 GMT) - Judgment joined cases C-58/95 Gallotti, C-75/95 Censi, C-112/95 Salmaggi, C-119/95 Pasquire, C-123/95 Zappone, C-135/95 Segna, C-140/95 Cervetti, C-141/95 Gasbarri, C-154/95 Narducci, C-157/95 Smaldone: environment and consumers. - Oral procedure C/241/95 The Queen, ex parte: Accrington Beef Co Ltd v/ Intervention Board for Agricultural Produce: commercial policy. THIRD CHAMBER (0930/0730 GMT) - Oral procedure C-255/95 S. Agri and others v/ Regione Veneto: agriculture. - (1030/0830 GMT) Oral procedure C-273/95 Impresa Agricola Buratti Leonardo, Pierluigi e Livio v/ Tabacchicoltori Associati Veneti Soc. coop. a.r.l. (TAV): agriculture. FIFTH CHAMBER (0930/0730 GMT) - Judgment C-251/94 Eduardo Lafuente Nieto v/ Instituto Nacional de Seguridad Social (INSS) and Tesoreria General de la Seguridad Social (TGSS): free movement of persons. - Judgment joined cases C-254/94, C/255/94, C-269/94 Fattoria autonoma tabacchi and others v/ Ministero dell'Agricoltura et delle Foreste and others: agriculture. - Judgment C-278/94 Commission v/ Belgium: free movement of persons. - Judgment C-236/95 Commission v/ Greece: company law. - Opinion C-340/94 E.J.M. de Jaeck v/ Staatssecretaris van Financieen: free movement of persons. - Opinion joined cases C-88/95, C-102/95 and C-103/95 Bernardina Martinez Losada and others v/ Instituto Nacional de Empleo (INEM), Instituto Nacional de la Seguridad Social (INSS): free movement of persons. - Opinion C-139/95 Livia Balestra v/ Istituto nazionale per la previdenza sociale (INPS): social policy. - (1530/1330 GMT) Phytheron International SA v/ Jean Bourdon SA: free movement of goods. SIXTH CHAMBER (0930/0730 GMT) - Opinion C-221/94 Commission v/ Luxembourg: approximation of legislation. - Opinion C-142/95-P Associazione agricoltori della provincia di Rovigo and others v/ Commission, Mauro Girello and Greguoldo Daniele: environment and consumers. - Opinion C-262/95 Commission v/ Germany: environment and consumers. - Opinion C-314/95 Commission v/ Italy: agriculture. - Oral procedure C-69/95 Italy v/ Commission: agriculture. COURT OF FIRST INSTANCE, FOURTH CHAMBER (0930/0730 GMT) - Oral procedure joined cases T-454/93, T-455/93, T-456/93 and T-457/93 Elders Trading Ltd and Paterson Elders (Produce) Ltd. and others v/ Commission: agriculture. BRUSSELS - Union of Industrial and Employee's Confederation of Europe (UNICE) hold press briefing on "Taxation in the EU" (1530/1330 GMT). Venue: UNICE, rue Joseph II. Contact: UNICE (322) 231 1445. BRUSSELS - Friends of the Earth Europe hold conference on "International biosafety" (To September 13). Topics include: the EU and international biosafety actions; experiences with international legislation on the transfer of potentially hazardous substances; north-south transfer of genetically modified organisms; legal instruments to be included in an international biosafety protocol, implementation and control. Venue: Palace Hotel. Contact: Friends of the Earth Europe (322) 542 0180. FRIDAY, SEPTEMBER 13 BRUSSELS - Centre for European Policy Studies (CEPS) holds workshop on "The strategic implications of the Euro for banks and corporates" (1000/0800 GMT). Agenda includes: implication of the empirical findings on economies of scale and scope in European banking; mergers and acquisitions in European banking; European banking: a cross-country comparison; Euro pricing and marketing strategies in Europe; implications for corporate finance; place of business and taxation. Venue: Place du Congres 1. Contact: CEPS (322) 229 3911. ROME (NEW ITEM) - NATO Secretary General Javier Solana addresses NATO Defence College; (possibly) meets Italian Prime Minister Romano Prodi and Foreign Minister Lamberto Dini. SUNDAY, SEPTEMBER 15 BRUSSELS - COPA holds conference on "Women farmers: more than a job, a life" (To September 17). Venue: COPA, 23-25 rue de la Science. Contact: COPA (322) 287 2711. BARCELONA, Spain - Eurotextil exhibition on the textile and clothing industry takes place (To September 17). Venue: Fira de Barcelona. Contact: Eurotextil (34) 93 233 2000. CRACOW, Poland - European Commission and the Polish government hold joint conference on "Industrial property in European integration" (1900/1700 GMT) (To September 17). Speakers include: Head of the Commission delegation in Poland Rolf Timans, Commission DG XV Director General John Mogg. Contact: Kserkop (48) 12 33 39 24. MONDAY, SEPTEMBER 16 BRUSSELS - Farm Council (To September 17). STRASBOURG - European Parliament plenary session (To September 20). BRUSSELS - IGC Working Party of EU foreign ministers' representatives meets to continue review of EU treaties (To September 17). Topics include: institutional issues, budgetary issues, national parliaments. TUESDAY, SEPTEMBER 17 BRUSSELS - Knibb, Gormezano and Partners hold conference on "The automotive industry and the environment" (To September 18). Venue: Renaissance Hotel. Contact: Automotive Matters International Ltd (44) 1628 526 060. END OF DOCUMENT. 3673 !G15 !GCAT **** HIGHLIGHTS **** DUBLIN - EU leaders hold special European Council (October). SINGAPORE - Inaugural World Trade Organisation (WTO) ministerial conference (December 9-13). DUBLIN - Irish Presidency European Council of heads of state and government (December 13-14). MONDAY, SEPTEMBER 2 ST PETERSBURG (NEW ITEM) - EUROSTAT holds seminar on "Way ahead for statistics in new independent states" (To September 6). Main topics discussed are the evaluation of the development of statistical systems targeted to market driven economy in the Tacis countries and consider the way ahead. TUESDAY, SEPTEMBER 3 BRUSSELS - European Parliament Inquiry Committee into mad cow disease holds first meeting. Spanish Socialist leader Manuel Medina presents report. BRUSSELS - IGC Working Party of EU foreign ministers' representatives meets to continue review of EU treaties (To September 4). Topics include: citizenship, fundamental rights, subsidiarity, simplification and codification. WEDNESDAY, SEPTEMBER 4 BRUSSELS (EXPANDED ITEM) - European Commission holds first regular weekly meeting after its summer break. Provisional agenda, liable to change, includes: - Continue discussion on dispute on Saxony regional government's decision to grant aid to Volkswagen plant despite a ban by the European Commission. - European Commission President Santer, European Commissioners Bangemann, Flynn, de Silguy, Liikanen, Papoutsis communcation on question related to the expiration of the ECSC Treaty - orientation debate. - (possibly) European Commissioner Monti communication on draft directive on media concentrations - orientation debate COM(96)396. - European Commissioner Bjerregaard communication on marketing quotas for HCFCs. BRUSSELS - European Parliament mini-session (To September 5). Provisional agenda includes: - (1500/1300 GMT) Statement by the Commission on urgent political matters of major importance followed by questions. - (1630/1430 GMT) Statements by the Council and the Commission an public services followed by a debate. - Robin Teverson report on the sixth annual report for 1994 on the structural funds COM(95)583. - Joint debate: - (possibly) Konstantinos Klironomos report on development issues relating to Objective I structural measures in Greece. - Giles Chichester report on development issues/Objective 1 - structural measures in Portugal. - Angela Siepra Gonzalez report on development problems/structural measures under Objectives 1-2 and 5b in Spain (1994-1999). - Bernd Lange report on the 1995 annual report on the research and technological development activities of the European Union COM(95)443. - (possibly) Karl von Wogau report on the rates of duty laid down in Council directive 92/79/EEC of 19 October 1992 on the approximation of taxes on cigarettes, Council directive 92/80/EEC of 19 October 1992, on the approximation of taxes on manufactured tobacco other than cigarettes, Council directive 92/84/EEC of 19 October 1992, on the approximation of the rates of excise duty on alcohol and alcoholic beverages and 92/82/EEC of 19 October 1992, on the approximation of the rates of excise duties on mineral oils COM(95)285. - Werner Langen report on the common system of Value Added Tax (level of the standard rate) COM(95)731. - Gipo Farassino report on the proposal for a Council directive amending directive 91/439/EEC on driving licences COM(96)55. - (possibly) Per Stenmarck report on the proposal for a Council directive on safety rules and standards for passenger ships COM(96)61. THURSDAY, SEPTEMBER 5 BRUSSELS - European Parliament mini-session (second of two days). Provisonal agenda includes: - (until 0900/0700 GMT) Political group meetings. - (0900/0700 GMT) Edgar Schiedermeier report on a European strategy for encouraging local development and employment initiatives COM(95)273. - Michel Rocard report on the reduction of working hours. - (1100/0900 GMT) Votes on reports under the cooperation, codecision and assent procedures and motions for resolutions on which the debate has closed. BRUSSELS - Executive committee of the Bosnian Peace Implementation Council, known as the Steering Board, meets ahead of September 14 Bosnian elections to discuss post-election framework peace plan. FRIDAY, SEPTEMBER 6 TRALEE, Ireland (EXPANDED ITEM) - Informal General Affairs Council (To September 8). Agenda includes: - (1730/1630 GMT) Irish Foreign Minister and European Council President Dick Spring addresses reception at Abbey Gate Hotel. - (2000/1900 GMT) Presidency hosts dinner. LINZ, Austria - GLOBE holds conference on "Responding to climate change". Contact: GLOBE (322) 230 6589. SATURDAY, SEPTEMBER 7 TRALEE, Ireland (EXPANDED ITEM) - Informal General Affairs Council (second of three days). Agenda includes: - (1500/1400 GMT) Informal working sessions begins; main discussions focus on the review of IGC progress. SUNDAY, SEPTEMBER 8 TRALEE, Ireland (EXPANDED ITEM) - Informal General Affairs Council (last of three days). Agenda includes: - (0930/0830 GMT) Informal working session continues. - (1215/1115 GMT) Irish Foreign Minister and European Council President Dick Spring holds closing news conference. MONDAY, SEPTEMBER 9 BRUSSELS - (possibly) ECOFIN Council. BRUSSELS (NEW ITEM) - EU Monetary Committee meets (To September 10). BRUSSELS - Euro-Mediterranean meeting on projects concerning cultural heritage (To September 10). BRUSSELS - European Newspaper Publishers Association (ENPA) holds conference on "Journalists and the world of politics, publishers and politicians" (1100/0900 GMT). Venue: Royal Crown Hotel. Contact: ENPA (322) 551 0190. DUBLIN (NEW ITEM) - Stuart Eisenstat, U.S. special envoy named by U.S. President Bill Clinton to advise on Washington's Helm-Burton legislation, on official visit. TUESDAY, SEPTEMBER 10 EDINBURGH - European Commission's DG XVI, Committee of the Regions and Scotland hold conference on land-use planning in the North Sea and Baltic regions. LUXEMBOURG - COURT OF JUSTICE, PLENARY COURT (0930/0730 GMT) - Judgment C-61/94 Commission v/ Germany: external relations. - Judgment C-222/94 Commission v/ United Kingdom: free movement of persons. - Judgment C-277/94 Z. Taflan-Met and others v/ Bestuur van de Sociale Verzekeringsbank: external relations. - Judgment C-11/95 Commission v/ Belgium: free movement of persons. - Oral procedure C-24/95 Land Rheinland-Pfalz v/ Alcan Deutschland GmbH: state aid. - (1100/0900 GMT) Oral procedure C-59/95 Francisco Bastos Moriana and others v/ Bundesanstalt fuer Arbeit: free movement of persons. - (1530/1330 GMT) Oral procedure C-169/95 Spain v/ Commission: state aid. BRUSSELS - Centre for European Policy Studies (CEPS) holds seminar on "NATO enlargement" (1315/1115 GMT). Speaker is Andras Simonyi, Ambassador and Head of Hungarian Liaison Mission with NATO and the Western European Union. Venue: Place du Congres 1. Contact: CEPS (322) 229 3911. END OF DOCUMENT. 3674 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * Removal from the register of Case T-209/95 (1) (96/C 247/44) Action brought on 4 July 1996 by Ludwig Kramer against Commission of the European Communities (Case T-104/96) (96/C 247/43) Action brought on 28 June 1996 by Gencor Ltd against the Commission of the European Communities (Case T-102/96) (96/C 247/42) Action brought on 27 June 1996 by Miguel Vicente Nunez against Commission of the European Communities (Case T-100/96) (96/C 247/41) Action brought on 18 June 1996 by Neue Maxhutte Stahlwerke GmbH against the Commission of the European Communities (Case T-97/96) (96/C 247/40) Action brought on 17 June 1996 by Gestevision Telecinco SA against Commission of the European Communities (Case T-95/96) (96/C 247/39) Action brought on 17 June 1996 by Martin Hagleitner against Commission of the European Communities (Case T-94/96) (96/C 247/38) ORDER OF THE PRESIDENT OF THE COURT OF FIRST INSTANCE of 25 July 1996 in Case T-98/96 R: Mario Costacurta v. Commission of the European Communities (Officials - Decision providing for reassignment to a post - Suspension of operation) (96/C 247/37) ORDER OF THE PRESIDENT OF THE COURT OF FIRST INSTANCE of 12 July 1996 in Case T-93/96 R: Catherine Presle v. European Centre for the Development of Vocational Training (96/C 247/36) ORDER OF THE PRESIDENT OF THE COURT OF FIRST INSTANCE of 5 July 1996 in Case T-85/96 R: Francis Alan Clarke v. European Centre for the Development of Vocational Training (96/C 247/35) ORDER OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-30/96: Jose Gomes de Sa Pereira v. Council of the European Union (1) (Council decisions appointing the chairmen and members of the Boards of Appeal of the Office for Harmonization in the Internal Market (trade marks and designs) - Action for annulment - Action for damages - Inadmissible) (96/C 247/34) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-170/95: Paolo Carrer v. Court of Justice of the European Communities (1) (Officials - Competition - Selection board - Decision by the selection board finding that a candidate had failed the oral test - Principle of equality of treatment - Infringement of the competition notice - Assessment by the selection board) (96/C 247/33) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-146/95: Giorgio Bernardi v. European Parliament (1) (Actions for annulment of measures - Ombudsman - Nominations - Appointment procedure - Inadmissibility - Principle of non-discrimination) (96/C 247/32) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-102/95: Jean-Pierre Aubineau v. Commission of the European Communities (1) (Officials - Members of the temporary staff - Contract of employment - Transfer - Place of employment) (96/C 247/31) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-271/94: Eugenio Branco Lda v. Commission of the European Communities (1) (Applications for annulment - European Social Fund - Reduction of financial assistance initially granted - Absence of an act which may be challenged - Inadmissibility) (96/C 247/30) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-175/94: International Procurement Services SA v. Commission of the European Communities (1) (Action for compensation - Public contract - European Development Fund - Non-contractual liability - Determination of the origin of goods) (96/C 247/29) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-161/94: Sinochem Heilongjiang v. Council of the European Communities (1) (Anti-dumping - Action for annulment - Admissibility - Conduct of the investigation - Injury) (96/C 247/28) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Case T-587/93: Elena Ortega Urretavizcaya v. Commission of the European Communities (1) (Officials - Member of the temporary staff - Offer - Temporary staff contract - Alteration of grade and duties - Legitimate expectations) (96/C 247/27) JUDGMENT OF THE COURT OF FIRST INSTANCE of 11 July 1996 in Joined Cases T-528/93, T-542/93, T-543/93 and T-546/93: Metropole Television SA and Others v. Commission of the European Communities (1) (Competition - Decisions of associations of undertakings - Agreements between undertakings - Exemption decision) (96/C 247/26) JUDGMENT OF THE COURT OF FIRST INSTANCE of 10 July 1996 in Case T-482/93: Martin Weber and Others v. Commission of the European Communities (1) (Common agricultural policy - Support system for oilseeds - Regulations (EEC) Nos 3766/91 and 525/93 - Actions for annulment of measures - Inadmissibility) (96/C 247/25) JUDGMENT OF THE COURT OF FIRST INSTANCE of 6 June 1996 in Case T-391/94: Jean Baiwir v. Commission of the European Communities (1) (Officials - Act adversely affecting an official - Time-limits under the Staff Regulations - Inadmissibility - Action for damages). (96/C 247/24) JUDGMENT OF THE COURT OF FIRST INSTANCE of 6 June 1996 in Case T-262/94: Jean Baiwir v. Commission of the European Communities (1) (Officials - Plea of illegality - Consistency between the complaint and the application - New method of assessing career profiles for Categories B, C and D at the Commission - List of officials considered most deserving of promotion - Articles 5 (3) and 45 of the Staff Regulations - Principle of non-discrimination - Manifest errors of assessment of fact and law - Action for damages) (96/C 247/23) JUDGMENT OF THE COURT OF FIRST INSTANCE of 5 June 1996 in Case T-398/94: Kahn Scheepvaart BV v. Commission of the European Communities (1) (State aid - Shipbuilding - General aid scheme - Action for annulment - Admissibility) (96/C 247/22) Designation of a President of Chamber and assignment of Judges to Chambers (96/C 247/04) Swearing of the oath by a new member of the Court of First Instance (96/C 247/03) Decisions adopted by the Court of Justice on 12 July 1996 (96/C 247/02) Swearing of the oath by a new member of the Court of Justice (96/C 247/01) END OF DOCUMENT. 3675 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * ANNEX STATEMENT OF THE COUNCIL'S REASONS ANNEX I ANNEX A STATEMENT OF THE COUNCIL'S REASONS END OF DOCUMENT. 3676 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * Inventory of European environmental targets and review of sustainability goals Call for tender No EEA/AIA/009/96 (96/C 249/08) Supply of laboratory equipment Notice of invitation to tender issued by the Commission of the European Communities on behalf of the Government of the Slovak Republic in the framework of the Phare Programme (96/C 249/07) Office furniture Restricted procedure (96/C 249/06) Review of existing scenarios and prospective analysis studies Call for tender No EEA/AIA/012/96 (96/C 249/05) Notice concerning the organization of open competitions (96/C 249/04) Proposal for a Council Regulation amending and updating Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community and Regulation (EC) No 574/72 laying down the procedure for implementing Regulation (EEC) No 1408/71 (96/C 249/03) (Text with EEA relevance) COM(96) 318 final - 96/0170(CNS) Amended proposal for a European Parliament and Council Directive on consumer protection in the indication of the prices of products offered to consumers (96/C 249/02) (Text with EEA relevance) COM(96) 264 final - 95/0148(COD) Ecu (1) 26 August 1996 (96/C 249/01) END OF DOCUMENT. 3677 !G15 !GCAT * (Note - contents are displayed in reverse order to that in the printed Journal) * COMMISSION DECISION of 27 March 1996 concerning aid granted by Italy to Altiforni e Ferriere di Servola, an ECSC company in special administration, located in Trieste, Italy (Only the Italian text is authentic) (Text with EEA relevance) (96/515/ECSC) COMMISSION DECISION of 20 March 1996 authorizing the grant by the United Kingdom of aid to the coal industry (Only the English text is authentic) (96/514/ECSC) COMMISSION REGULATION (EC) No 1682/96 of 26 August 1996 temporarily suspending the issuing of export licences for certain milk products and determining what proportion of the amounts covered by pending applications for export licences may be allocated COMMISSION REGULATION (EC) No 1681/96 of 26 August 1996 establishing the standard import values for determining the entry price of certain fruit and vegetables COMMISSION REGULATION (EC) No 1680/96 of 26 August 1996 opening intervention in accordance with Article 6 (4) of Council Regulation (EEC) No 805/68 END OF DOCUMENT. 3678 !C13 !C31 !C311 !CCAT !E21 !E211 !ECAT !GCAT !GCRIM Rembrandt Group Ltd Chairman Johann Rupert on Tuesday warned that further excise duty hikes on tobacco would lead to further illegal cigarette imports. This, he told the group's annual general meeting, would run counter to Health Minister Nkosazana Zuma's aim of discouraging smoking as illegal imports did not carry health warnings. Zuma and other government ministers have said recently they were considering higher excise duties on tobacco to discourage smoking and raise extra revenue to bring down the budget deficit. "We now have conclusive proof that greater volumes of imported cigarettes are available in the South African market without health warnings," Rupert said. A survey by the group of urban areas had found that illegal imports were available in more than 80 percent of all outlets. "These are illegal. They do not have health warnings on them and especially irksome to us is that one of these products is a product that we have the right to legally import into this country. "So the manufacturer is caught in a Catch 22 situation. If they put the South African health warning on, we nail them for breach of contract because we know that they are specifically targeting the product in South Africa. "So they know that they cannot put the health warning on...but it is available in 80 percent of the market." He said he wanted "to caution that they (the health department) cannot control the smuggling at this stage, and if they think that they are going to have a fresh rise in excise duties, the situation will get worse. "I am prepared to show them that they cannot control the current situation." Rupert said imports came mainly from Brazil and the U.S. and were well known trademarks. Rupert, an ardent smoker who makes sure shareholders are well supplied with ashtrays during meetings, said recent threats by U.S. President Bill Clinton to toughen anti-smoking laws were part of a "populist approach during an election year". He said the U.S. was "light years" behind the rest of the world in clamping down on smoking and he doubted whether recent legal victories against tobacco companies would survive appeals. -- Cape Town newsroom +27 21 25-2238 3679 !C12 !C13 !CCAT !GCAT !GCRIM A South African court has ruled that only the U.S. hamburger chain McDonald's can sell Big Macs, McNuggets, Fillet-o-Fish and its other trademarked fast foods, the company said on Tuesday. McDonald's Corporation and McDonald's South Africa said the appeal court confirmed them as rightful owners of all McDonald's trademarks currently registered in South Africa. Since last year, the group has been involved in a lengthy battle to prevent local rivals, businessmen George Sombonos and George Charalambous, from using its name. McDonald's, which stayed away from South Africa during apartheid, opened its first fast-food outlet in the country last year and now has seven, most owned by local entrepreneurs. A court had earlier ruled in favour of the two Georges who rejected the U.S. corporation's claim that U.S. sanctions had kept it out of apartheid South Africa. The businessmen argued that McDonald's had let its right to the trademarks under South African law lapse, by registering them but failing to use them over the ensuing five years. McDonald's is the largest global food retailer, with over 19,200 outlets in 94 countries. Nearly three-quarters are franchised. South Africans love fast-food and the hamburger chain faces stiff entrenched competition from local rivals with names such as Bimbo's and Chicken Licken. 3680 !E21 !E211 !ECAT !GCAT !GPOL Prime Minister Vaclav Klaus on Tuesday said the 1997 Czech state budget, to be presented to the full cabinet in September, plans an overall spending increase of 11.8 percent. Speaking to reporters after a working session of economics ministers, Klaus also said he did not expect inflation to fall below eight percent next year. The monetarist economist Klaus, who has said a balanced budget is the "Alpha and Omega" of his government, said spending increases would be largest in percentage terms for export supports, regional transportation, and housing. He said the total expenditure side next year would rise 58 billion czech crowns ($2.21 billion) over expected 1996 spending to 549 billion crowns. The ministers were to discuss the revenue side of the budget later in September. Finance Minister Ivan Kocarnik said the full cabinet should get the full draft for discussion on September 20. When asked if there was talk among ministers of anything excpet a balanced budget Kocarnik replied tersely "No". The government's draft budget has traditionally been debated and passed by mid-December. Klaus's government has passed four straight balanced budgets, although it will discuss a plan on Wednesday to cut 1996 spending by another 9.3 billion crowns in order to balance this year's ledger. Klaus said the expenditure figures were still subject to further discussion but he did not expect major changes. Fixed manadatory expenditures are forecast rising by 14.0 percent while discressionary spending would rise 9.9 percent. Klaus added that state sector wages were planned to rise a nominal 12.4 percent in 1997, and he hoped that it would set an example for private sector budget planning. "(The government) wants to send a message which would lead to a certain stoppage of the pace of wage increases also in the non-budget (private sector) sphere," Klaus said. Earlier this month the central bank warned of inflationary wage rises not being matched by increases in productivity. Klaus also said that he did not expect 1997 inflation to fall below eight percent, which was the government's target for lowering inflation in 1996. "Unfortunately we don't expect a number lower than eight (percent)," he said. He did not elaborate on if he meant average or year-on-year inflation. For budget purposes, however, the government usually speaks in terms of average inflation. Czech year-on-year inflation stood at 9.4 percent in July, while the moving average stood at 8.6 percent. The government in passing the 1996 budget forecast inflation for the year of roughly eight percent, but strong domestic demand has kept prices higher. ($1=26.24 Czech Crown) 3681 !GCAT !GPOL Hungarian Prime Minister Gyula Horn told a closed meeting of his Socialist Party on Tuesday that he has selected privatisation minister Tamas Suchman to head the industry and trade ministry, a party official said. Magda Kovacs Kosane, managing vice president of the party, said Suchman would replace Industry and Trade Minister Imre Dunai, who plans to leave the post in September after resigning two weeks ago. Suchman's existing job as minister without portfolio for privatisation would be merged into the industry and trade ministry, Kovacs Kosane said. She said that Hungary's state privatisation agency, APV Rt, would also come under the industry and trade umbrella. The announcement at the meeting received the full support of party members, Kovacs Kosane said. Finance Minister Peter Medgyessy, who was present at the meeting, said Suchman's appointment did not mean that the economic policy making of the government would have a dual centre, she added. The junior coalition partner Free Democrats said at the weekend that they had no objection to Suchman's appointment or to the merging of the ministerial functions. Suchman is known as one of the more left-leaning members of the Socialist Party but under his tenure Hungary has achieved record revenues from privatisation. Dunai was said to have had a falling out with the government over the issue of rate hikes for power companies, with Dunai supporting higher increases than the cabinet thought would be acceptable to the general public. The government announced last week that it was delaying implementation of rate hikes which had been expected by private investors who last year bought up a large segment of Hungary's power and gas distribution business. 3682 !GCAT !GENT Poland's capital Warsaw, destroyed by Hitler and rebuilt under Stalin, is offering the gaping urban spaces left by both periods of its tragic history as the prizes in a commercial building boom. Warsaw hopes to lure foreign investors with city-centre greenfield sites for brand-new development -- beating beautiful Prague and Budapest to become the region's business centre. New construction also offers a chance to transform areas which, even the proudest citizens admit, badly need a makeover. "We will be the local metropolis for Central and Eastern Europe. I am convinced of this," Warsaw city's President Marcin Swiecicki told Reuters in an interview. German invaders crushed Warsaw's heroic 1944 uprising in World War Two and deliberately levelled the city to rubble. The whole country, under Soviet-imposed communism, made huge sacrifices to rebuild its capital after the war. One long swathe, including the beautiful Old City district and the palace-studded Lazienki Park, were lovingly recreated. But dictator Josef Stalin stamped a vast copy of Moscow's weirdest high-rise buildings, the Workers' Palace of Culture, as a symbol of Soviet domination in the very centre. This useful but unlovely 242-metre (794 ft) "Stalin Gothic"' tower remains the leading landmark, visible far outside town. The communists left a stark, empty expanse around it to hold their parades and dwarf the individual -- this heart of Warsaw is a now a sea of tawdry market stalls and car parks. In other central areas, vacant lots adjoin relentless rows of stained concrete blocks that hide amid an ocean of trees in summer, but emerge in full bleakness in winter. "Hitler and Socialism are the main authors of Warsaw's current appearance, but the fact remains that Warsaw is the ugliest capital I know...," wrote humorist Jacek Federowicz in a newspaper column last year, as his artist wife urged him to move to the gracious former royal seat, Krakow in the south. Poland now hopes an influx of foreign money will transform Warsaw, celebrating its 400th anniversary as capital this year. The country, the largest in the region, has an economy projected to grow at 5.5 percent this year and mayor Swiecicki said Warsaw's new airport had excellent links worldwide. "We have free areas in the centre of the city, where one can build offices, banks and conference centres from scratch rather than reconstructing existing buildings," he said. Already several bright new developments tower over the grey boxes left from decades of communist rule that ended in 1989. Next in line is a 40-hectare (100 acre) area adjoining the central parade square, being prepared for tenders by the Dutch ING Real Estate, part of ING Groep NV, the Samsung Group of South Korea and a Polish group. Two Brussels-based Polish architects won a contest in 1992 for plans to develop the parade square itself, and are working out studies on preparing infrastructure for building it over. Under this longer-term scheme, the Palace of Culture would radiate roads leading to 30 plots of various shapes, offering 300,000 square metres (3.2 million sq ft) to 900,000 square metres (9.7 million sq ft) of usable space. These new buildings would blur the starkness of the Palace itself and give central Warsaw a modern, Western flavour. New development offers a chance to continue rebuilding old Warsaw. Work has started to recreate the historic, palatial pre-war city hall and to house modern offices for two banks. There are also plans, involving Belgian interests, to rebuild the Saski Palace on what is now a large square by the Tomb of the Unknown Soldier near the Old City, Swiecicki said. He said development would be greatly helped if Poland at last passed a law on restitution for property taken over by communist authorities after the war. An obstacle to new building is uncertainty about who has rights to what ground. A city government reorganisation two years ago removed some bureaucratic hurdles and 90 central plots have been given over to construction, up from 10 before the changes, he said. Despite 120,000 square metres (1.3 million sq ft) of high-quality office space becoming available annually, Swiecicki said vacancies were below two percent and monthly rents remained high at $40-$50 a square metre, giving strong incentives to investors. By the year 2004, Warsaw's first underground railway line, now functioning along only half the planned route, will be completed and may help ease the grave traffic congestion. The city also has plans for building two new bridges, replacing ageing buses and trams, and cleaning up its Vistula River, which citizens shun because of its heavy pollution. Funding for such projects remains tight, prompting the city's current plans to launch a major municipal bond issue. Many local critics of the city government, which links ex-communists and Swiecicki's centrists, cite potholed roads, cramped housing, crooked taxi-drivers, and bureaucracy as more pressing issues than any sweeping future construction plans. But Warsaw, with its two million people, is on a roll. "It will be hard for us to become a Prague or Budapest, because of our history," Polish President Aleksander Kwasniewski told Warsaw's Zycie Warszawy newspaper. "But I am speaking with many representatives of the world's greatest companies and they want to pick Warsaw as their destination," he said. 3683 !E21 !E211 !ECAT !GCAT !GPOL !GVIO Most Australians approve of their new conservative government's deficit-slashing budget, a newspaper poll showed on Tuesday. The poll was published a week after rioters stormed parliament in a protest against budget cuts. In contrast to scenes of bloodshed in Canberra on the eve of the August 20 budget announcement, Treasurer Peter Costello on Tuesday danced on live commercial television during an interview aimed at selling the budget to middle Australia. The opinion poll, published in The Australian newspaper, showed 59 percent support for Costello's big budget cuts. "I think because we levelled with people, there was a great acceptance of the need to make changes and the need to improve things. I think the public has understood that," Costello told the Channel Nine network's Midday Show. Costello then accepted an invitation to dance a Latin jig with the show's woman host. Prime Minister John Howard's government plans to slash A$2.9 billion (US$2.3 billion) from spending and raise A$1.0 billion in extra revenue for the fiscal year to June 30, 1997. The poll showed Australians had given the new government's first budget "the most positive reception for a federal budget in 10 years", said The Australian, which a week ago carried banner headlines of an unprecedented pre-budget riot. A total of 59 percent of those surveyed felt the budget was good for the economy, and half would vote for the ruling Liberal-National coalition in a snap election, the poll showed. The support would, if an election were held this month, give the conservative parties an even bigger win than their landslide victory last March, when they swept the Labor party from office. Rioters stormed parliament house on August 19, clashing with police equipped with riot gear during a two-hour confrontation over budget cuts already announced and labour market reforms. The next day, hours before Costello announced the budget measures, about 150 Aborigines angry at cutbacks attacked police with bricks, bottles and stakes in the capital. US$1 = $0.78 3684 !E51 !E512 !ECAT !GCAT !GDIP Officials of the six nations of the Mekong river region arrived in southwestern China on Tuesday for a ministerial conference intended to boost cooperation in an area long hobbled by distrust and war. The sixth meeting of the Greater Mekong Sub-region (GMS) programme would begin in Kunming city on Wednesday, with ministers from Thailand, Laos, Cambodia, Vietnam, Burma and China scheduled to review billions of dollars worth of regional infrastructure projects, officials at the conference said. Ministers would consider an environmental action plan to curb deforestation on the upper reaches of the Mekong which borders or flows through all six nations, said Norida Morita of the Asian Development Bank (ADB). The meeting would push forward the GMS programme from planning projects to implementation, Morita told reporters. "The main thrust of the Greater Mekong activities is to link the six countries with a transport network," he said. A proposed $490 million road to connect Bangkok with Phnom Penh and Ho Chi Minh city in southern Vietnam was one project expected to gain ministerial approval, officials said. Other joint projects being considered include a $1.8 to $2.1 billion China to Southeast Asia railway and construction of a telecommunications and power transmission network. Plans to boost infrastructure in the underdeveloped region were only one part of a programme that had helped speed the transformation of the area from wartorn backwater to an attractive investment destination, said GMS consultant David Husband of Global Economics Ltd. China and Vietnam border troops and naval forces clashed repeatedly in the 1980s after a bloody border conflict in 1959. Vietnamese troops fought Khmer Rouge guerrillas in Cambodia through the late 1980s, while drug lords and soldiers sparred along the Thai-Burmese border. "The projects are the tangible results, but sub-regional cooperation is as much as anything about trust and goodwill," Husband told Reuters. "This very coming together is testimony to the world that something is happening here," he said. "It has helped draw attention to the fact that there is peace in the region." GMS supporters hope that this trust forged through shared economic and environmental projects will help build stability in the Mekong region, home to almost 230 million people. Relations between the six nations have seldom been better, despite the Cambodian government's continuing war against the Khmer Rouge and the political divide between Burma's military junta and the country's democratic activists. A rush of new interest in investment projects in the area was making the coordination of development a key issue at the Kunming conference, ADB's Morita said. New development initiatives from the Association of Southeast Asian Nations and other countries were welcome, but should be organised to complement the development foundation built by the GMS programme and the ADB, he said. 3685 !C33 !C331 !CCAT !GCAT !GDEF Taiwan is considering buying military helicopters from Russia, and more private orders are likely to follow as the island opens up domestic helicopter routes, a local newspaper said on Tuesday. The United Evening News, quoting unidentified sources, reported the military would send a high-ranking officer to discuss a purchase deal with Russian helicopter makers. It gave no further details. Russia does not have formal diplomatic relations with Taiwan but has opened an unofficial trade office in Taipei. China, which has regarded Taiwan as a renegade province after a civil war split them in 1949, strongly objects to military links between the island and foreign countries. The report said many private companies also showed interests in Russian-made helicopters because of their relatively cheap prices. Taiwan has said it would allow private helicopter passenger and cargo transport on the island by the end of 1996. According to initial proposals, the government plans to grant 15 licences to helicopter firms to allow them to fly between the island's 12 airports. In July, top Russian aircraft maker Aviastar said it would set up a marketing and assembly centre in Taiwan with investment totalling T$2 billion (US$72.6 million). Aviastar would introduce twin-engine Tupolev Tu-204 medium-range passenger jets to Asia and transfer maunfacturing and maintenance technology to Taiwan. 3686 !E51 !E512 !ECAT !GCAT !GDIP Two weeks after Taiwan's president worried aloud that the island was growing too dependent on arch rival China's vast markets, there are few signs anyone is taking the caution seriously. Quite to the contrary, business prospects appear to be blossoming across the Taiwan strait after more than a year of acrimony and dangerous sabre-rattling. Tuesday saw the departure for China of a blue-ribbon delegation replete with captains of Taiwan industry and senior officials of the island's Nationalist government. The 62-strong group, including the secretary general of the Economics Ministry acting in a private capacity, is the biggest and most prominent to cross the strait since Taiwan-China ties started spiralling downward in June 1995. The business-building mission in effect reciprocates for a summer-long spate of ostensibly private but unprecedented visits to Taiwan by heavyweight Chinese officials. These have included Shanghai's stock market chief, the head of state-owned mainland flag-carrier Air China and directors of all of China's major ports -- a reflection of Beijing's acute desire for an end to Taipei's 47-year-old ban on direct links. So what of President Lee Teng-hui's public hand-wringing about Taiwan's over-dependence on China's markets and his call for limiting local firms' mainland investments? Lee's appeal briefly startled Taiwan's stock market when issued in an August 14 speech and is widely believed to have claimed one casualty -- Formosa Plastics group's decision to cancel plans to build a US$3 billion power station in China. But analysts say Lee's warning ignores the political reality that Taiwan's economy already is deeply interlaced with China's and that pulling back is impossible. Chinatrust Commercial Bank chief economist Daniel Chen, in a telephone interview, said Taipei could do little to control firms' China investments even if it wanted to. "It is very unrealistic," Chen said. "Taiwan's economy is very open and liberalised. It is impossible for this government agency or that to say it wants to control investment. They (investors) can simply go through Hong Kong, Singapore or another country." Chen said Taiwan had no choice but to move forward with prudent China investments in hopes that China's political liberalisation would keep pace with the island's gradual economic integration. "You can't stop this grand trend, especially if China can reform further in the future," Chen said. "If the leftists in China slowly disappear, they (China's current leaders) can implement further the free-market system and Taiwan can benefit a lot more from China's reform." The pro-business model dovetails with Beijing's latest drive to bring Taiwan under the red flag of the People's Republic. Having seen the failure of nearly a year of military bluster toward Taiwan, China has begun appealing to its economic interests, extolling the mutual benefits of direct aviation and shipping links, wider investment and other business links. Taiwan and Hong Kong media say the new economic olive-branch may have been ordered by Communist Party chief and President Jiang Zemin himself. Jiang is reported to have sought recent data about just how dependent Taiwan is on China's economy. "They are trying to have Taiwan rely more economically on the People's Republic," Chen said. "Even if we understand that they have this kind of intention, we still cannot control our over-investment. Some 30,000 Taiwan firms have poured around US$20 billion into China investments, which, due to their small average size, are not seen as a major strategic liability for Taiwan. But the stakes get much larger on July 1, 1997, when Hong Kong comes under Chinese rule, giving Beijing significant new leverage over Taiwan via the island's huge investments there. Analysts generally agree that Lee's government won a small victory by persuading Formosa to halt its power plant venture, saying to proceed with it would have opened the floodgates to more major investments. But the writing is on the wall for any efforts to stop the tide of smaller investments. "Economic and trade activity cannot be contained," the influential United Daily News said in an editorial about Taiwan's latest trade mission to China. "Following the trend is the way we should deal with this matter." 3687 !C13 !C31 !C312 !CCAT !E51 !E512 !ECAT !G15 !G152 !G158 !GCAT The Association of Southeast Asian Nations (ASEAN) on Tuesday sent a letter to the European Commission protesting against new rules that they said would make their products less competitive. The letter asked the Commission to rescind an order requiring exporters of vegetable oil to use "dedicated" ships. The letter signed by Philippine agriculture secretary Salvador Escudero was released at the end of a two-day ASEAN agriculture and forestry ministers meeting in Manila. The ASEAN ministers also asked the European Union to reconsider a new trade scheme which uses a country's economic growth data as a guage to determine tariffs on food exports starting January 1, 1997. ASEAN groups the Philippines, Indonesia, Malaysia, Brunei, Vietnam, Singapore and Thailand. Escudero said the European Union had issued a directive in January saying it would allow shipments of vegetable oils only if the vessel transported food items. ASEAN, whose members are the world's largest exporters of coconut oil and palm oil, said the directive would make its products less competitive with higher costs. "If the spirit of the directive is to ensure the safety of foodstuffs during transport, we would like to reiterate that there were no cases of contamination of vegetable oil shipped to the European Union from various sources since October 1993," said Escudero, who chaired the ministers' meeting. Escudero said the introduction of a revised generalised system of preferences (GSP) for agricultural products from developing countries, including the new ASEAN "dragons", would not only have adverse financial and economic impact on ASEAN farmers but also political repercussions. "The national gross domestic product (GDP) and average per capita GDP in recent years among ASEAN member countries do not reflect the actual living standards in the ASEAN farming sector," Escudero said. The GSP seeks to increase tariffs by as much as 300 percent on agricultural products imported to the 16-member European Union. 3688 !C12 !CCAT !GCAT !GCRIM It was business as usual on Tuesday for South Korean tycoons sentenced for bribery on Monday, with one jetting off to Libya and others planning overseas jaunts. Attention was focused mainly on the fate of the globe-trotting chairman of the Daewoo Group who was handed a two-year jail sentence after being convicted of bribing former president Roh Tae-woo. Analysts said Daewoo, which has invested billions of dollars overseas, would be most vulnerable to the loss of its charismatic chairman, Kim Woo-choong. But they said the moguls were likely to be spared jail time since they were too important to the national economy. Nine corporate heads were convicted of bribing Roh in return for business favours. Kim and the heads of Dong-Ah, Jinro and Hanbo received jail terms and the others suspended jail sentences. "It's not in the government's best interest to see the economy suffer," said Richard Samuelson, head of research at SBC Warburg's Seoul branch, adding he expected the tycoons would avoid jail. "There has to be a balance between justice and running a healthy economy." Shares in Daewoo Corp were battered on Monday in anticipation of the verdict and on Tuesday edged down 70 won ($0.09) to 7,200 won. "Daewoo would be in chaos if Kim Woo-choong was jailed. It would be a stranded ship," said Tae Chung, head of research at Jardine Fleming Securities. "Kim was involved in every area of Daewoo's work." Kim spearheaded Daewoo's aggressive expansion overseas, setting up car plants in the former communist bloc countries, building hotels in China and becoming the largest foreign investor in Vietnam. "Daewoo is widely regarded as a creature of Kim Woo-choong's energy and force of will," said Samuelson. There was no indication Kim's hard-charging business style has been affected by the sentence. "The chairman will continue his active participation in all our business fields," a Daewoo spokesman said. "We don't believe the jail sentence will hurt our investment projects abroad." Kim will fly to China on Wednesday to open a hotel before touring Daewoo's automobile factories in Eastern Europe. Dong-Ah chairman Choi Won-suk, handed a 2-1/2 year jail term, boarded a flight for Libya to attend a ceremony marking the completion of the second phase of a huge waterway project. Jinro chairman Chang Jin-ho, also sentenced to two years behind bars, plans to visit Cambodia next month to negotiate a farm development project, a group spokesman said. All three have received court permission to travel. Chung Tae-soo, honorary chairman of the Hanbo group, had no travel plans. He was given a two-year term. Chung and Chang appealed their sentences on Tuesday. Kim and Choi plan to appeal. All remain free pending their appeals. Some analysts said the government is expected to tread carefully because jail for the businessmen would have serious repercussions on affiliate companies, especially on their ability to raise finance overseas. "Overseas lenders don't like seeing chairmen in jail," said Samuelson. 3689 !C12 !C41 !CCAT !GCAT !GCRIM !GPOL The heads of South Korea's Jinro and Hanbo groups on Tuesday appealed against jail terms handed down on Monday for bribing former president Roh Tae-woo, a spokesman for the Seoul District Criminal Court said. The official said lawyers for Jinro chairman Chang Jin-ho and Hanbo head Chung Tae-soo submitted the appeals to the three-judge panel that sentenced them. "They said they were appealing against the jail sentences which they cannot accept," the official said. Chang and Chung were among nine business tycoons convicted of bribing Roh. Four were sentenced to jail and the others received suspended jail sentences. Roh was sentenced to 22-1/2 years in jail for mutiny and sedition on top of corruption. 3690 !GCAT !GDIP China called on Taiwan on Tuesday to show goodwill by lifting a decades-old ban on direct trade and transport links, saying attempts by the island nation to block such links would be futile. "Obstructing the three links between the two sides...will be futile...is against the will of the people on both sides," a commentary by the Xinhua news agency said of Taiwan's ban on direct trade, transport and mail links with China. "(We) hope the Taiwan authorities can make a pragmatic, goodwill response," said the commentary carried by major newspapers on Tuesday. Last week, China introduced a series of regulations to pave the way for direct shipping links. Taiwan has banned direct trade, transport and mail links with China since Mao Zedong's communist army defeated and drove Chiang Kai-shek's Nationalist troops to the island at the end of a civil war in 1949. Indirect links between the two sides have been allowed since the late 1980s through Hong Kong or a third country. The commentary accused the Taiwan authorities of creating obstacles to direct trade and transport links in recent years, saying this would not be conducive to prospects for peaceful reunification. The commentary did not explain how it would not be conducive. China regards Taiwan as a renegade province and has threatened to invade if the island declared independence. It has also sought to push Taipei into diplomatic isolation. Many Taiwanese businessmen, who have poured more than $20 billion into China, clamour for direct trade and transport links, but Taiwan has been reluctant to lift the ban, which it views as its last bargaining chip in talks with the communists. Taiwan says it is committed to reunification but stresses this cannot be achieved overnight. Last week China heaped pressure on Taiwan by offering to hold political talks to end almost five decades of hostility. Nearly 80 prominent Taiwanese business leaders and politicians were scheduled to arrive in Beijing on Tuesday for a a high-profile, 12-day visit, despite reservations voiced by the island's leaders about depending too heavily on China. The visit has aroused attention because the delegation is led by Kao Ching-yuan, a senior member of Taiwan's ruling Nationalist Party and vice-chairman of President Enterprises, the island's biggest investor in China. Taiwanese newspapers said Kao would meet Chinese President Jiang Zemin and other senior officials. The trip comes less than two weeks after Taiwan's President Lee Teng-hui called for a review of economic policy toward China with the aim of avoiding over dependence on the mainland. The China Times Express newspaper in Taipei said on Sunday that Taiwan's economic planners had drawn up measures -- including contingency plans to restrict Taiwanese investment on the mainland -- if Taiwan-China relations deteriorate. The Taiwanese delegation would be the largest to visit China since easing tensions across the Taiwan Strait began to fray in mid-1995 over a landmark, private visit by Taiwan's President Lee to the United States. In apparent retaliation, China denounced Lee and held intimidatory war games off Taiwan before the island's historic presidential elections in March in which Lee was re-elected. 3691 !GCAT !GCRIM !GVIO A day after he was sentenced to death, disgraced South Korean former president Chun Doo Hwan on Tuesday faced another mammoth legal battle to escape the hangman's noose. Neither Chun nor his presidential successor Roh Tae-woo, sentenced to 22-1/2 years in prison on similar charges connected with a 1979 coup and an army massacre in Kwangju in 1980, have yet lodged formal appeals. But media reports said their lawyers were preparing to challenge the rulings and that the appeals could drag through the courts for up to eight months. Few Koreans think Chun will hang, and there is intense speculation over whether current President Kim Young-sam will end one of the most traumatic chapters in modern Korean history by offering both men a clemency before he steps down next year. State prosecutors on Tuesday said they would decide by the end of this week whether to appeal Roh's sentence. They had demanded life in jail. "We believe the court has unfairly handed down a lesser sentence to Roh," Kim Sang-hee, the senior prosecutor in charge of the case, told Reuters. In deciding on any pardon, President Kim would have to weigh public disgust against Chun and Roh with the support both men still have in their home provinces. However, popular anger against the former generals is waning, partly because the trial threw up so much evidence to show they were simply at the tip of a pyramid of corruption that touched almost every layer of society. "This is a reputational society, and these two are dead already," said Moon Chung-in, a professor of politics at Yonsei University. Moon was echoing the sentiment in some quarters that the one-time military academy classmates had suffered enough, and that to hound them further would be unnecessarily cruel. "Not many people expect Chun and Roh's sentences to be carried out," said the Dong-Ah Ilbo daily. "President Kim has not mentioned a word about an amnesty, but there is widespread speculation Kim will pardon them." Meanwhile, it was business as usual for the nine corporate heads sentenced to jail for bribing Roh. Their convictions have not altered their busy travel plans. Dong-Ah Group chairman Choi Won-suk, who was handed a 2-1/2 year jail term, left the country on Tuesday to attend a ceremony marking the completion of the second phase of a huge waterway project in Libya. "The chairman is very concerned with how the jail sentence would affect the overseas projects," said a Dong-Ah spokesman. He said Choi had received the court's permission on Monday to travel overseas. The spokesman said lawyers were preparing an appeal. All the businessmen have seven days to appeal, during which time they remain free. The chairman of Daewoo Group, Kim Woo-choong, sentenced to two years in jail, flies off on Wednesday to attend the opening of a hotel in China before touring Daewoo's automobile factories in Eastern Europe. "The chairman will continue his active participation in all our business fields," said a Daewoo spokesman. "We don't believe the jail sentence will hurt our investment projects abroad." The chairman of the Jinro Group, Chang Jin-ho, also sentenced to two years in prison, plans to visit Cambodia early next month to negotiate a farm development project, a group spokesman said. He said Chang also would appeal in the next few days. Samsung Group chairman Lee Kun-hee was sentenced to two years in jail, suspended for three years. 3692 !C12 !C15 !C151 !CCAT !GCAT !GCRIM Indonesia's central bank suffered seven billion rupiah ($2.9 million) in losses resulting from fake transactions, the Jakarta Post reported on Tuesday. A Bank Indonesia spokeswoman confirmed the newspaper report but declined to give further details. The bank's governor Sudradjat Djiwandono was quoted as saying on Monday about 5.4 billion rupiah of the seven billion rupiah had been recovered. The newspaper said it was the central bank's first public scandal in its 43-year history. The paper said five people had been arrested and police were looking for two more suspects. ($1 = 2,341 rupiah) 3693 !C12 !CCAT !GCAT !GCRIM The chairman of the Jinro group, Chang Jin-ho, will appeal a two-year jail sentence handed down by a Seoul court on Monday for bribing former president Roh Tae-woo, a group spokesman said on Tuesday. "If we don't appeal, the chairman would have to go to jail," said the spokesman. "And if he goes to jail the group will face a considerable setback in business. So we have to appeal." Chang was among nine businessmen found guilty of bribery on Monday by the Seoul District Criminal Court. --Seoul Newsroom (822) 727 5643 3694 !E12 !E41 !E411 !ECAT !GCAT !GPOL Palestinian Trade Minister Maher al-Masri said on Tuesday he would demand Israel lift a crippling closure on the West Bank and Gaza Strip during a meeting with Israeli Finance Minister Dan Meridor. The two began their meeting at Israel's Finance Ministry in Jerusalem at about 0900 GMT in the highest level meeting between Israel and Palestinian officials since Foreign Minister David Levy met Palestinian President Yasser Arafat on July 23 in Gaza. "Since it will be the first meeting (on economics), we will discuss the general guidelines of the PLO-Israeli economic accord and I will insist on the need for the Israeli side to implement it," Masri told Reuters before the meeting. "The most basic element in the economic accord is the freedom of movement of Palestinian goods and people, therefore we will insist that they implement it by lifting the closure," he said. "The closure in itself is a violation of the accord." Israel's previous government imposed the closure in reaction to a wave of Islamic militant suicide attacks in February and March. The government of Prime Minister Benjamin Netanyahu, which took office in June, has continued the ban which bars tens of thousands of Palestinian labourers from livelihoods in Israel. Israeli finance ministry officials were not immediately available to comment on Masri's remarks. Meridor told the Israeli parliament's finance committee on Monday: "We have no interest in Palestinian poverty. Their poverty is not our wealth. On the contrary, we have an interest in the welfare and improved economic situation there." Masri said there were over 35 Israeli violations of the accord, such as obstructing the construction of a Palestinian port and airport in the Gaza Strip self-rule enclave. "We will see during the meeting how the Israeli side will deal with these violations," Masri said. Meridor said at parliament "improvements in the Palestinian Authority must be seen over a wide range -- economic, political and security, and I plan to conduct talks with the Palestinians in this spirit." PLO officials said as a result of the closure, tens of thousands of Palestinian workers lost their jobs in Israel and unemployment has reached an unprecedented level of 51 percent in the West Bank and Gaza Strip, home to nearly two million Palestinians. They said some economic sectors were completely paralysed and the obstruction of the movement of goods in and out of self-ruled areas harmed industries and development projects. Israeli officials said the government eased the closure last month. Some 45,000 Palestinians can now work in Israel. Israel has gradually pared down its Palestinian work force. Before the outbreak of the Palestinian uprising began in December 1987, some 160,000 Palestinians worked in Israel. 3695 !C24 !CCAT !E12 !ECAT !GCAT !GPOL Saudi Arabia's King Fahd said the government would encourage the private sector in order to boost economic development of the oil-rich Gulf Arab state, the Saudi Press Agency reported. "The government gives great importance to the private sector and will continue to support it," it quoted the monarch as telling the weekly cabinet meeting on Monday night. SPA said the king also called on residents to use electricity and water sparingly. Electricity demand in the kingdom is close to capacity with official forecasts pointing to more than seven percent annual demand growth for the rest of the decade, mainly from surging industrial demand. Saudi Arabia aims to lessen dependence on oil revenues and attract private local and foreign investment to diversify its economy. 3696 !C13 !CCAT !GCAT !GHEA !GPOL White House Chief of Staff Leon Panetta said the Clinton adminstration would consider backing off its demand that the FDA regulate nicotine, CBS News reported on Tuesday. Panetta told CBS the White House would be willing to give up the Food and Drug Administration's proposed jurisdiction over tobacco if the industry adhered to new rules that would ban most vending machine sales and restrict cigarette advertisements aimed at youngsters. "The fundamental requirement is getting the industry to meet these requirements so that kids will not be attracted to smoking," Panetta told CBS in an interview. "And frankly anything that can avoid the long-term litigation that's involved here with these regulations would be helpful." The new regulations, announced on Friday, are due to be phased in over two years and include a number of measures aimed at stopping young people from taking up smoking. The tobacco industry has vowed to fight the regulations in court, arguing that the FDA does not have the legal authority to regulate nicotine. CBS also reported that White House officials had said they would have to take a very hard look at how any proposed legislative might deal with the possiblity of freeing the tobacco industry from lawsuits by smokers. In a poll released on Tuesday, CBS said 67 percent of Americans approved of the new government regulations which gave the FDA authority over the sale and advertising of cigarettes and other tobacco products. Twenty-six percent disapproved. However 62 percent of those polled said the regulations were not likely to reduce significantly the number of minors using cigarettes and other tobacco products. The poll of 540 adults was conducted on Monday and had a margin of error of plus or minus five percentage points. 3697 !C12 !C31 !C34 !CCAT !GCAT !GCRIM Archer Daniels Midland Co likely will face criminal charges in a U.S. government price-fixing investigation after three companies pleaded guilty, legal experts said Tuesday. "It puts them (ADM) on notice that their alleged co-conspirators are cooperating with the government, providing both documents and oral testimony," said Robert Stephenson, an attorney with Cotsirilos, Stephenson, Tighe & Streicker in Chicago. "The table stakes have significantly increased that ADM will be charged." An ADM spokeswoman said the company declined to comment. The other three firms admitted to conspiracy in price-fixing of lysine, a feed additive. Stephenson has no direct involvement in the ADM case but is experienced in antitrust cases. Earlier the Justice Department said Ajinomoto Co Inc and Kyowa Hakko Kogyo Co Ltd of Tokyo and the U.S. unit of Sewon Co Ltd of South Korea admitted conspiring to fix prices to eliminate competition in the world lysine market. They also agreed to cooperate fully with the investigation by providing witnesses and documents. "If they (the government) have signed some of the potential defendants to plea agreements that include a commitment to cooperate, that puts tremendous pressure on the remaining potential defendant, of which ADM is obviously one," said Joe Sims, an attorney with Jones, Day, Reavis & Pogue. At this point, he added, ADM may decide to enter a plea or may face indictment. "Either one of those things can come reasonably promptly," said Sims, an antitrust expert who is not directly involved in the ADM case. "I would not be surprised to see something in the next 30 days." If ADM should decide to enter a plea, analysts said it could easily afford the $10 million fines that were levied against Ajinomoto and Kyowa. "Those are not the kinds of fines that are going to break the company," Piper Jaffray analyst George Dahlman said. He added that, as of March 1996, ADM had about $3.0 billion in working capital. In a separate proceeding, ADM has agreed to pay $25 million to settle a civil lysine price-fixing lawsuit brought by its customers as part of an overall $45 million settlement that also involves Ajinomoto and Kyowa Hakko. The guilty pleas by Ajinomoto, Kyowa Hakko and Sewon came about 14 months after ADM acknowleged the government had asked it for documents and testimony in an antitrust investigation. That probe included high-fructose corn syrup, citric acid and lysine. Since the beginning, ADM has denied any wrongdoing and has said it cooperated fully with the investigation. One wrinkle in the case, however, has been the controversy surrounding Mark Whitacre, a former president of ADM's BioProducts Division, who acted as a government informant in the probe for about three years. Whitacre was fired by ADM last year over allegations he embezzled millions of dollars from the company. Stephenson said the guilty pleas by Ajinomoto, Kyowa Hakko and Sewon diminish the government's need to rely on Whitacre as a witness against ADM. Reuters Chicago Newsdesk - 312-408-8787 3698 !C12 !CCAT !GCAT !GCRIM The owner of Chequepoint, the currency exchange and money transfer business, has sued two of Britain's biggest banks, alleging they acted in concert to cut off banking services and quash Chequepoint, a competitor. In a lawsuit filed in federal court in New York, Capital Currency Exchange NV, which owns Chequepoint, sued National Westminster Bank Plc and Barclays Plc, seeking unspecified damages. Chequepoint, with operations in the United States and 10 other countries in Europe and Asia, said it was the world's largest independent currency exchange organisation catering to consumers. In the lawsuit, filed Friday in U.S. District Court in Manhattan, Chequepoint claimed that Barclays in May 1995 moved to terminate the 18-year-old banking relationship between them, despite the fact that Chequepoint was a "valued and profitable customer" with a good credit rating. The lawsuit alleged that National Westminster then refused to become Chequepoint's bank, after Barclays had refused to provide a reference. It said the defendants conspired "to deny appropriate banking opportunities and services to Chequepoint, a competitor of the defendants," hurting Chequepoint's currency exchange and international money transfer business. The lawsuit alleged that by their actions, the defendants' violated U.S. antitrust laws. In addition, the lawsuit named Natwest's chief executive, Hamish Martin Vincent Gray; its chairman, Lord Alexander of Weedon, and John Martin Taylor, chief executive of Barclays, as defendants. "We have previously corresponded with lawyers acting for Chequepoint and denied their allegations," a NatWest spokesman said, adding that the ompany will fight the lawsuit. Barclays officials were not immediately available. 3699 !C31 !C313 !CCAT !GCAT !GENT Following are final data for the top 10 movies at the August 23-25 weekend box office, according to Exhibitor Relations Co. Inc. Film Three-Day Gross Cumulative Gross 1. The Island of Dr. Moreau $ 9,101,987 $ ---- 2. Tin Cup $ 8,610,741 $ 23,721,119 3. A Very Brady Sequel $ 7,052,045 $ ---- 4. A Time To Kill $ 6,142,811 $ 82,436,202 5. Jack $ 5,786,871 $ 37,410,976 6. Independence Day $ 4,739,170 $274,504,698 7. The Fan $ 3,312,040 $ 12,614,473 8. Emma $ 2,467,231 $ 9,191,949 9. Solo $ 2,228,668 $ ---- 10 Escape From L.A. $ 2,110,146 $ 21,281,286 NOTE: "The Island Of Dr. Moreau" is released by Turner Broadcasting System Inc's New Line Cinema. "Tin Cup" and "A Time To Kill" are released by Time Warner Inc's Warner Bros. "A Very Brady Sequel" and "John Carpenter's Escape From L.A." are released by Viacom Inc's Paramount Pictures. "Jack" is released by Walt Disney Co. "Independence Day" is released by News Corp's 20th Century Fox. "The Fan" and "Solo" are released by Sony Corp . "Emma" is released by Disney's Miramax Films. 3700 !GCAT !GSPO Jose Maria Olazabal, out of action for nearly a year because of rheumatoid arthritis in his feet, will be allowed to use a cart to get around the course at a golf tournament later this year. The European tour committee said on Tuesday the Spaniard can use the buggy at a pairs event in Bordeaux from October 17-20, but they stressed it was strictly a one-off measure. Olazabal won the non-ranking pairs tournament with compatriot Seve Ballesteros in April last year and the decision allows them to defend the title, although Ryder Cup captain Ballesteros has said he is still not certain to play. Olazabal's manager Sergio Gomez said on Monday the 30-year-old has been practising hard in Spain recently, but walking still left him in pain. The 1994 U.S. Masters champion last played tournament golf at the Lancome Trophy in Paris last September and has been undergoing treatment in a bid to resume his career. "Sometimes he gets desperate," Gomez said. "The frustrating thing is if the arthritis was in his hands he would know he couldn't play golf. He can still hit the shots okay, but it's the walking in between, and we keep hoping things will improve enough for him to return. "He's playing two or three times a week, driving a cart and once walking. But after three hours the pain starts, and rounds on tour are longer than that." Gomez added that if Olazabal played in Bordeaux, he would start the tournament on foot and call for the cart only if necessary. Earlier, Scotsman Colin Montgomerie said allowing Olazabal to use a cart would set an unhelpful precedent. "I know Olly's situation is very unfortunate, but I don't think we can start giving dispensations," he said. "You've got to have a rule for everybody and I don't think it's feasible." The use of carts is generally prohibited in the professional game. 3701 !GCAT !GSPO Seve Ballesteros and Colin Montgomerie are divided on whether Jose Maria Olazabal should be allowed to return to the European PGA Tour using a motorised cart to transport him around the course. The Spaniard has not played for nearly a year because of rheumatoid arthritis in both his feet, and organisers of a pairs event to be staged in Bordeaux, France from October 17 to 20 have been asked to provide him with a buggy. "If the (Tour's tournament) committee decides to change the rule I would not be against it," said Ballesteros, Olazabal's compatriot and Ryder Cup captain. But commitee member Montgomerie said it could set an unhelpful precedent. "I know Olly's situation is very unfortunate, but I don't think we can start giving dispensations," he said. "You've got to have a rule for everybody and I don't think it's feasible." The use of carts is generally prohibited in the professional game, and if Olazabal is allowed to use one in Bordeaux, he might then request one for the qualifying tournaments for next year's Ryder Cup. 3702 !GCAT !GSPO Poland and Cyprus drew 2-2 (halftime 0-0) in a friendly soccer international on Tuesday. Scorers: Poland - Krzysztof Warzycha (46th minute), Marcin Mieciel (57th) Cyprus - Klimis Alexandrou (75th), Kostas Malekos (80th) Attendance 3,000 3703 !GCAT !GSPO Europe's golfers begin a year-long chase for Ryder Cup points this week to earn a place in next year's team to defend the coveted trophy against the Americans at Valderrama. The British Masters which begins at Collingtree Park on Wednesday has drawn a big cast including 10 members of the victorious 1995 team, one of whom is the man who will be watching over all their endeavours, new team captain Seve Ballesteros. The Spaniard, who said last week he hopes all his top men will do their best to qualify rather than rely on wild-card selection, reiterated on Tuesday he still hopes to be a playing as well as captaining in the match. After the British Masters, Ballesteros will play in five more events before the end of the year in order to earn as many Ryder Cup points as possible. But Ballesteros, the major force in so many European teams, said that even if he qualified, he might not play -- while if he did not qualify he might still name himself to the team. "It depends on how I am playing at the time and what is best for the team. I will have to balance the situation," said the Spaniard, who missed the halfway cut in his last three European events, the Irish, British and German Opens. Ballesteros' hope for his best players to qualify by right by playing more in Europe has already fallen on deaf ears as far as Nick Faldo, the hero of the 1995 triumph, is concerned. He has rejected the Spaniard's plea by saying he still intends to play virtually all his golf on the U.S. circuit again next year. Faldo, not playing here this week, has scheduled only one qualifying event in Europe during the rest of this year, next month's Lancome Trophy in France, and may not play in Europe again before next year's British Open. But he hopes that a new rule whereby earnings in the major events in the U.S. count towards selection for the Cup team will help him guarantee his place. "Let's hope he plays well," Ballesteros said. Ballesteros has already failed in his attempt to have the number of wild card selections at his disposal increased from two to four. "They said we won last time with that system so why change it," he said. One of his prime players, world number two Colin Montgomerie, came out against that policy on Tuesday. "We don't have flexibility. We don't have the strength in depth that the Americans have and we need flexibility to pick our best team," he said. Montgomerie is intending to play but that may change depending on the condition of his father, who suffered two heart attacks last week. The big Scot withdrew from last week's German Open but said on Tuesday his father was recovering well in hospital. He said the situation, as well as the illness of his daughter earlier this year, had changed his perspective. "There are a lot more things in life than golf and life is one of them," he said. But he still has an ambition to fulfil this year even though his main aim of winning a major title has been thwarted. "I want to win the European Order of Merit for the fourth successive time," he said. Following his withdrawal and Ian Woosnam's triumph in Germany last week, Montgomerie now trails the Welshman by some 50,000 pounds sterling ($77,500) in the money list. "I may even add a tournament this year to replace the one I missed last week," he said. 3704 !GCAT !GSPO An injury time try by New Zealand wing Glen Osborne preserved the All Blacks unbeaten South African tour record as they snatched an 18-18 draw against Griqualand West on Tuesday. But while salvaging their unbeaten record, the All Blacks may have lost winger Jonah Lomu for the remainder of the tour. The giant winger injured a shoulder and was replaced at half-time. A fine second half performance by the provincial side had threatened to end New Zealand's run of six successive victories with only Saturday's final test in Johannesburg to come. Griquas were down 10-6 at the interval, but tries by lock Andre Cloete and wing Leon van der Wath in the opening 10 minutes of the second half gave them an 18-10 lead. A penalty by New Zealand fly-half Jon Preston with four minutes remaining narrowed the gap to five points before Osborne's last-gasp intervention. Centre Alama Ieremia made the try by producing a 20-metre pass in midfield to pick out the right wing who had an unopposed run to the line. Preston's attempted conversion to win the game went wide in the windy conditions. Taine Randell, captaining the All Blacks, was far from happy with the way his team played. "We are despondent about the way things turned out but at least we have kept our unbeaten record. We were pretty confident but Griquas played well." The All Blacks had looked set for a seventh straight win after a try by centre Scott McLeod helped them to an interval lead. But in the second half, Griquas kept the ball close to their pack and were in sight of a famous victory on a ground where an unbeaten 47-match home run was ended only earlier this season. Teams: Griqualand West: 15-Boeta Wessels; 14-Leon van der Wath, 13-Andre Vermeulen, 12-Tobie de Jager (17-Lourens Venter, 49), 11-Ian Horn; 10-Franco Smith, 9-Abrie Pretorius; 8-Phillip Smit (18-Frankel Engelbrecht, 40) (19-Dagga Bosman, 75), 7-Gideon Watts, 6-Theo Oosthuizen, 5-Andre Cloete, 4-Marius Cloete, 3-Piet Bester, 2-Andre Bester, 1-De Waal Venter. New Zealand: 15-Matthew Cooper; 14-Eric Rush, 13-Alama Ieremia, 12 - Scott McLeod, 11-Jonah Lomu (17-Glen Osborne, 40); 10-Jon Preston, 9 - Ofisa Tonu'u; 8 - Taine Randell, 7 - Andrew Blowers, 6-Todd Blackadder, 5 - Glenn Taylor, 4-Blair Larsen, 3-Con Barrell (Phil Coffin, 65), 2 - Norman Hewitt, 1-Mark Allen. 3705 !GCAT !GSPO Jimmy Thomson became Scotland's first managerial casualty of the season on Tuesday when he quit Raith Rovers, bottom of the premier division. Thomson resigned after the club's directors asked him to return to his previous position as youth team coach. He had been in charge for six months. Raith lost their first two games of the season away to Rangers and Celtic, then crashed 3-0 at home to Motherwell on Saturday. A club statement said: "The directors of Raith Rovers FC invited Jimmy Thomson to relinquish the post of manager and to resume his former position as youth team coach. "Regrettably Jimmy has felt unable to accept that offer, and has accordingly left the club." Thomson said: "I am leaving with my dignity and my pride intact, and that is very important to me. "While not agreeing with the directors' decision, I respect their reasons for making it." 3706 !GCAT !GSPO Griqualand West and New Zealand drew 18-18 (halftime 6-10) in their rugby union tour maltch on Tuesday. Scorers: Griqualand West - Tries: Andre Cloete, Leon van der Wath. Conversion: Boeta Wessels. Penalties: Wessels 2. New Zealand - Tries: Scott McLeod, Glen Osborne. Conversion: Jon Preston. Penalties: Preston 2. 3707 !GCAT !GSPO Former England midfielder Alan Ball resigned as manager of first division side Manchester City on Monday night, the club said. Ball, appointed in July 1995, was unable to prevent City being relegated from the premier league last season and his record read 13 wins, 14 draws and 22 losses in 49 games. They have lost two of their three matches so far this season. Club secretary Bernard Halford said in a statement: "The chairman and Board would like to place on record their appreciation of his endeavours and efforts whilst in his period of office and wish him well in the future." 3708 !GCAT !GSPO English league soccer standings after Tuesday's matches (tabulated under played, won, drawn, lost, goals for, against, points): Division one Tranmere 3 2 1 0 6 3 7 Bolton 3 2 1 0 5 2 7 Barnsley 2 2 0 0 5 2 6 Wolverhampton 2 2 0 0 4 1 6 Queens Park Rangers 2 2 0 0 4 2 6 Stoke 2 2 0 0 4 2 6 Norwich 3 2 0 1 4 3 6 Ipswich 3 1 1 1 6 4 4 Birmingham 2 1 1 0 5 4 4 Crystal Palace 3 1 1 1 3 2 4 Oxford 3 1 0 2 6 3 3 Bradford 2 1 0 1 3 2 3 Huddersfield 2 1 0 1 3 3 3 Portsmouth 3 1 0 2 3 5 3 Reading 2 1 0 1 3 5 3 Manchester City 3 1 0 2 2 3 3 West Bromwich 3 0 2 1 2 3 2 Port Vale 3 0 2 1 2 4 2 Sheffield United 2 0 1 1 4 5 1 Grimsby 3 0 1 2 4 7 1 Charlton 2 0 1 1 1 3 1 Swindon 2 0 1 1 1 3 1 Southend 3 0 1 2 1 7 1 Oldham 2 0 0 2 2 5 0 Divisionn two Plymouth 3 2 1 0 8 5 7 Brentford 3 2 1 0 6 3 7 Shrewsbury 3 2 1 0 6 3 7 Bury 3 2 1 0 4 2 7 Burnley 3 2 0 1 5 5 6 Bournemouth 3 2 0 1 4 3 6 Blackpool 3 2 0 1 3 2 6 Chesterfield 3 2 0 1 3 2 6 Millwall 3 1 1 1 5 4 4 Crewe 3 1 1 1 4 4 4 Gillingham 3 1 1 1 4 5 4 Preston 3 1 1 1 3 3 4 Notts County 2 1 1 0 2 1 4 Bristol Rovers 2 1 1 0 1 0 4 Bristol City 3 1 0 2 7 4 3 York 3 1 0 2 5 6 3 Watford 3 1 0 2 2 5 3 Wrexham 2 0 2 0 5 5 2 Wycombe 3 0 2 1 2 3 2 Rotherham 3 0 1 2 3 5 1 Peterborough 2 0 1 1 2 3 1 Walsall 3 0 1 2 2 4 1 Stockport 3 0 1 2 0 2 1 Luton 3 0 0 3 3 10 0 Division three Hartlepool 3 2 1 0 6 3 7 Wigan 3 2 1 0 5 2 7 Hull 3 2 1 0 4 2 7 Carlisle 3 2 1 0 2 0 7 Fulham 3 2 0 1 4 3 6 Scunthorpe 3 2 0 1 2 2 6 Scarborough 3 1 2 0 4 2 5 Exeter 3 1 2 0 4 3 5 Cambridge 3 1 2 0 3 2 5 Darlington 3 1 1 1 7 5 4 Northampton 3 1 1 1 5 3 4 Barnet 3 1 1 1 4 2 4 Chester 3 1 1 1 4 3 4 Torquay 3 1 1 1 3 3 4 Cardiff 3 1 1 1 1 2 4 Swansea 3 1 0 2 3 7 3 Brighton 3 1 0 2 2 5 3 Hereford 3 1 0 2 1 2 3 Lincoln 3 0 2 1 3 4 2 Colchester 3 0 2 1 1 3 2 Rochdale 3 0 1 2 2 4 1 Mansfield 3 0 1 2 2 6 1 Doncaster 3 0 1 2 1 3 1 Leyton Orient 3 0 1 2 1 3 1 3709 !GCAT !GSPO Results of English league soccer matches on Tuesday: Division one Crystal Palace 0 West Bromwich 0 Ipswich 1 Grimsby 1 Oxford 0 Norwich 1 Portsmouth 1 Southend 0 Tranmere 2 Port Vale 0 Postponed: Charlton v Birmingham, Sheffield United v Huddersfield Division two Brentford 2 Gillingham 0 Bristol City 5 Luton 0 Burnley 1 Shrewsbury 3 Chesterfield 1 Walsall 0 Preston 2 Crewe 1 Rotherham 1 Blackpool 2 Stockport 0 Bournemouth 1 Watford 0 Plymouth 2 Wycombe 0 Bury 1 York 3 Millwall 2 Postponed: Peterborough v Notts County, Wrexham v Bristol Rovers Division three Barnet 3 Brighton 0 Cardiff 0 Wigan 2 Carlisle 1 Leyton Orient 0 Chester 2 Swansea 0 Darlington 1 Colchester 1 Exeter 1 Doncaster 1 Hartlepool 2 Mansfield 2 Hereford 0 Hull 1 Lincoln 1 Cambridge 1 Northampton 1 Torquay 1 Rochdale 1 Fulham 2 Scunthorpe 0 Scarborough 2 3710 !GCAT !GSPO England and Pakistan Test averages after their three-match series which ended on Monday: England Batting (tabulated under matches, innings, not outs, runs, highest score, average): Alec Stewart 3 5 0 396 170 79.20 John Crawley 2 3 0 178 106 59.33 Nick Knight 3 5 0 190 113 38.00 Nasser Hussain 2 3 0 111 51 37.00 Mike Atherton 3 5 0 162 64 32.40 Graham Thorpe 3 5 0 159 77 31.80 Jack Russell 2 3 1 51 41no 25.50 Ian Salisbury 2 4 1 50 40 16.66 Mark Ealham 1 2 0 30 25 15.00 Dominic Cork 3 5 0 58 26 11.60 Robert Croft 1 2 1 11 6 11.00 Simon Brown 1 2 1 11 10no 11.00 Alan Mullally 3 5 1 39 24 9.75 Chris Lewis 2 3 0 18 9 6.00 Andy Caddick 1 1 0 4 4 4.00 Graeme Hick 1 2 0 8 4 4.00 Bowling (tabulated under overs, maidens, runs, wickets, average): Atherton 7 1 20 1 20.00 Caddick 57.2 10 165 6 27.50 Cork 131 23 434 12 36.16 Mullally 150.3 36 377 10 37.70 Hick 13 2 42 1 42.00 Croft 47.4 10 125 2 62.50 Brown 33 4 138 2 69.00 Ealham 37 8 81 1 81.00 Salisbury 61.2 8 221 2 110.50 Lewis 71 10 264 1 264.00 Thorpe 13 4 19 0 - Pakistan Batting: Moin Khan 2 3 1 158 105 79.00 Ijaz Ahmed 3 6 1 344 141 68.80 Salim Malik 3 5 2 195 100no 65.00 Inzamam-ul-Haq 3 5 0 320 148 64.00 Saeed Anwar 3 6 0 362 176 60.33 Rashid Latif 1 1 0 45 45 45.00 Aamir Sohail 2 3 1 77 46 38.50 Asif Mujtaba 2 3 0 90 51 30.00 Wasim Akram 3 5 1 98 40 24.50 Shadab Kabir 2 4 0 87 35 21.75 Mushtaq Ahmed 3 5 1 44 20 11.00 Waqar Younis 3 3 1 11 7 5.50 Ata-ur-Rehman 2 2 2 10 10no - Mohammad Akram 1 0 0 0 0 - Bowling: Mushtaq Ahmed 195 52 447 17 26.29 Waqar Younis 125 25 431 16 26.93 Wasim Akram 128 29 350 11 31.81 Ata-ur-Rehman 48.4 6 173 5 34.60 Mohammad Akram 22 4 71 1 71.00 Aamir Sohail 11 3 24 0 - Asif Mujtaba 7 5 6 0 - Salim Malik 1 0 1 0 - Shadab Kabir 1 0 9 0 - 3711 !GCAT !GSPO Waqar Younis signed to play county cricket for Glamorgan on Tuesday on a two-year contract reported to be worth 200,000 pounds sterling ($311,800). The Pakistan fast bowler, who helped his country clinch a 2-0 win in the three-test series against England which ended at The Oval on Monday, is to play for Glamorgan over the next two English seasons. Waqar said: "They seem a very ambitious club with some very good players and with a clear idea of how I would fit into their plans. "I am sure all they need is a catalyst to bring some success and hopefully I will be able to play my part in helping them achieve that. "I know just how much Viv Richards did for Glamorgan and if I can achieve the same in my two years in Wales I will be delighted." Glamorgan captain Matthew Maynard, who faces Waqar when he plays for England in the three-match one-day series against Pakistan later this week, said: "This is possibly the best signing Glamorgan has ever made. "Waqar is a genuinely world-class cricketer at the peak of his game and for us to be able to bring him to Wales is fantastic news." Glamorgan secretary Mike Firth said: "The figures reported do not tell the whole story but although you have to pay a premium to attract a player of this calibre, we have not gone in with our eyes closed. "There has been a lot of support, without which a coup of this sort would simply not have been possible. We see it very much as an investment -- a statement of the ambition we have as a club." Waqar will be having his second spell on the county circuit, having taken 232 wickets in three seasons for Surrey -- 1990, 1991 and 1993 -- before back problems interrupted his career. 3712 !GCAT !GSPO Graham Gooch, the 43-year-old former England captain, is to continue playing county cricket for at least another season, his club Essex announced on Tuesday. Opener Gooch's decision comes towards the end of a season in which he has underlined his consistency by becoming the leading scorer in Essex's history, beating Keith Fletcher's aggregate of 29,434. Gooch, who retired from test cricket after the 1994-95 tour of Australia but is now an England selector, is seventh in this season's first-class averages with 1,429 runs at 64.95, having hit five centuries and one double century. Essex secretary-general manager Peter Edwards said: "He is a remarkable batsman and still the best in this country. No-one will argue with that. You just have to look at his record to appreciate that fact." 3713 !GCAT !GSPO South Africa dropped flyhalf Joel Stransky on Tuesday when they announced their team in Johannesburg for the third and final test against New Zealand at Ellis Park on Saturday. Stransky's exclusion was one of five changes made by the Springbok selectors as they attempt to salvage some pride against the All Blacks having already lost the series, 2-0. Henry Honiball replaces Stransky -- who was the Springbok hero a month ago when he scored all 25 points in a win over Australia -- with Japie Mulder returning from a back injury in place of Andre Snyman. Three changes are forced by injury in the forwards with lock Kobus Wiese, hooker James Dalton and prop Dawie Theron replacing the trio of Hannes Strydom, Henry Tromp and Os du Randt. Team: 15-Andre Joubert, 14 - Justin Swart, 13-Japie Mulder, 12-Danie van Schalkwyk, 11-Pieter Hendriks; 10-Henry Honiball, 9 - Joost van der Westhuizen; 8-Gary Teichmann (captain), 7-Andre Venter, 6 - Ruben Kruger, 5-Mark Andrews, 4-Kobus Wiese, 3-Marius Hurter, -James Dalton, 1-Dawie Theron. 3714 !GCAT !GSPO The Romanian Soccer Federation has banned first division club Jiul Petrosani's president Miron Cozma for two years for headbutting a visiting team player, a federation statement said. Romania's soccer bosses also fined Cozma, a well-known miners' union leader, 10 million lei ($3000) for the half-time attack on Dinamo Bucharest's Danut Lupu last Sunday. Miners led by Cozma rioted in Bucharest in 1990 and 1991, bringing down the reformist government of premier Petre Roman. Cozma is awaiting trial for assault and criminal damage in a bar in his home town of Petrosan, 300 kms west of Bucharest. The attack on Lupu came during a tunnel skirmish between opposing players as they left the field. "Cozma's blow was not too painful because I'm a tall man," Lupu told Reuters on Tuesday. Lupu is one of the tallest players in Romania's first division, towering over Cozma by some 17 cms, Jiul Petrosani, promoted to the first division this year, won the league game 1-0. Cozma is barred from taking part in any official soccer activity during the ban. 3715 !GCAT !GSPO New South Wales rugby union coach Chris Hawkins has resigned at the end of his first season because of business commitments, officials said on Tuesday. Hawkins, whose side failed to reach the semifinals in the inaugural Super 12 competition, left on amicable terms, New South Wales Rugby Union chairman Ian Ferrier said. "Chris' business commitments make it difficult for him to embrace the coaching job on a full-time basis which is an essential element of the position given the year-round nature of preparing a team for professional provincial rugby," Ferrier said in a statement. Ferrier said the union would begin the search for Hawkins' replacement in the near future. New South Wales were rated among the favourites for the southern hemisphere Super 12 competition involving provincial sides from Australia, New Zealand and South Africa. Auckland defeated Natal in the Super 12 final in May. 3716 !GCAT !GSPO Australian Anthony Hill was back in trouble on Tuesday after receiving a conduct warning for verbal abuse during his first round win over England's Mark Chaloner in the Hong Kong Open. Hill, who completed a three-month ban from squash earlier this year for his misbehaviour at last November's World Open, received the warning during the second game of a physical match which he won 15-11 17-16 17-16 Hill now faces a fine of up to US$312 from the Professional Squash Association (PSA) and will be suspended for 12 months if his penalties this year exceed US$780. Fiery Hill will face another severe test of his temperament on Thursday when he meets Pakistan's Mir Zaman Gul in the second round. There has been bad blood between the two for more than two years following incidents at the 1994 British Open, when Gul was disqualified for butting Hill, and last year's World Team Championship when Hill physically and verbally abused Gul. World number six Del Harris, runner-up in last year's World Open, blasted squash's new seeding system after losing to fellow Englishman Mark Cairns 15-12 7-15 15-6 15-12 in the first round. The PSA reduced the number of seeds in major tournaments from 16 to eight in January and Harris claimed this had led to lopsided draws. While Harris faced a player ranked just six places lower than him in the first round, two qualifiers ranked 60th and 36th respectively played each other. "I think the draw is crazy. It's ridiculous," said Harris. "The sooner they change it the better. I did not vote for it (the change) but probably a lot of middle-ranked guys did." Top seed Jansher Khan, bidding for an eighth Hong Kong Open title, beat wild card entry Jackie Lee of Hong Kong 15-8 15-8 15-6 to ease into the second round. "I have not competed since May so I am quite happy with the way I played today," said Jansher. "I am sure I will improve in the next rounds." World number three Brett Martin of Australia, who lost to Jansher in last year's final, struggled to find his rhythm before recovering to beat 37th-ranked David Evans of Wales 14-17 15-1 13-15 17-14 15-12. 3717 !GCAT !GSPO First round results in the Hong Kong Open squash tournament on Tuesday (prefix denotes seeding): 1-Jansher Khan (Pakistnn) beat Jackie Lee (Hong Kong) 15-8 15-8 15-6 3-Brett Martin (Australia) beat David Evans (Wales) 14-17 15-1 13-15 17-14 15-12 Mark Cairns (England) beat 6 - Del Harris (England) 15-12 7-15 15-6 15-12 Anthony Hill (Australia) beat 8-Mark Chaloner (England) 15-11 17-16 17-16 Simon Frenz (Germany) beat Martin Heath (Scotland) 12-15 15-6 15-4 12-15 15-14 Joseph Kneipp (Australia) beat Ahmed Faizy (Egypt) 15-8 12-15 15-14 15-9 Mir Zaman Gul (Pakistan) beat Stephen Meads (England) 10-15 15-12 15-10 15-3 Dan Jensen (Australia) beat Anders Thoren (Sweden) 8-15 15-12 10-15 15-5 15-11 3718 !GCAT !GSPO A federal appeals court ruled on Tuesday that a Tulsa, Oklahoma, company could produce trading cards satirising major league baseball players and their big money contracts. The ruling by the 10th Circuit Court of Appeals followed an attempt by the Major League Baseball Players Association to stop Cardtoons L.C. from marketing the cards on grounds they violated the players' publicity and licensing rights. One of the cards showed a likeness of San Francisco Giants outfielder Bobby Bonds, one of baseball's highest paid players, and identified him as "Treasury Bonds." He is shown tipping a batboy for bringing him a golden bat labeled a "Fort Knoxville Slugger." The court said the cards were protected by the First Amendment and the right to free speech. "The cards. . . are an important form of entertainment and social commentary that deserve First Amendment protection," it said. "The irony of MLBPA's counter-claim for profits from the cards is not lost on this panel (of judges)," the court said. 3719 !GCAT !GSPO It had been three years since Jennifer Capriati last played the U.S. Open and the result was the same as the former teen star again made a first-round exit from Flushing Meadows. But while the three-set loss to Russian Leila Meskhi in 1993 triggered a freefall out of tennis for nearly two years and into a spate of trouble with drugs and the law, Capriati was upbeat following her 6-4 6-4 defeat to unknown Australian Annabel Ellwood. "This is what I want to be doing right now," the 20-year-old Capriati said of the tennis career she resumed earlier this year. "I'm just getting back to the game I love. I'm not going to take it too seriously or anything, just have fun with it." Just being back in the atmosphere of a Grand Slam tournament and hearing the roar of the crowd again made Capriati feel good. "It was great when I was out there," Capriati said of the 66-minute match on the Grandstand Court. "Just the whole energy, just the crowd. It was like, 'Yeah, you know, this is what I miss'." Unfortunately, Capriati also missed a lot of shots, making 40 unforced errors to only 28 from her 18-year-old opponent, who was playing in her first U.S. Open main draw. Capriati played poorly in the crucial stages of the match. Serving to pull even at 5-5 in each set, Capriati could barely find the court as she made a slew of errors to drop serve and the set each time. Still, Capriati saw something positive in her effort. "I feel like my game is just right there, I just don't have the edge yet," she said. "I feel like it's close." Capriati's comeback has also apparently helped heal some of the problems within her family. Though divorced, her parents, Stefano and Denise, sat together at courtside. And while in the past Capriati might have faced Stefano's scowl upon leaving the court after such a defeat, this time she got a loving arm around her shoulder from her father. "I think they're always going to be my parents and they're always going to be there for me," Capriati said. "I need their support. "I just got to stay in the now and try to stay positive." 3720 !GCAT !GSPO Tennis star Stefan Edberg may be playing his last Grand Slam at the U.S. Open, but he's not quite ready to say farewell just yet. "What I'm really aiming to do here this week is hopefully get into the second week and be around," said the Swedish fan favourite after a swift 6-3 6-3 6-3 first-round upset of fifth-seeded Wimbledon champion Richard Krajicek. "On paper it's a little upset, I would say, not a huge one," the former world number one, who is now ranked 28th, said with a sly grin and a shake of his blond head. The low-key 30-year-old is remarkably relaxed and feeling right at home on the U.S. Open's stadium court these days as his glorious Grand Slam career winds down. "At the moment I'm actually feeling very, very calm about the whole thing," said Edberg, who early in his career was not a big fan of New York's Grand Slam. "I found this place very, very tricky to come to," he said of his early U.S. Open campaigns. That changed forever in 1991 when the smooth Swede put together the first of his back-to-back title runs. "Always when you've won at the place, the whole place just changes, no question about it," said Edberg, who considers his straight sets win over Jim Courier in the '91 final to be the best tennis he ever played. "Since then, I've enjoyed every year coming here. It's been one of the very special places to come to," added Edberg, who also has two Wimbledon and two Australian Open titles. But Edberg has no regrets about his decision to make this U.S. Open the 54th and last Grand Slam of his career. "Knowing when you're going to retire, I think that makes it easier," he said. "I don't really want to hang around playing tennis out there if I can't perform the way I want to perform," he continued. "I want to be in the top 10 and really have a chance to win a Grand Slam. Those years are pretty much over. "I've been on the tour for many, many years. It's time for me to go now before it's too late." And if he should surprise himself and delight the fans by winning the U.S. Open one more time, might he change his mind about retiring? "No I will not," he said, smiling at the idea. "I'm so sorry." "Being realistic, there is a very little chance, but as long as I see that chance, I will go out there and do what I can." 3721 !GCAT !GSPO Tiger Woods, the 20-year-old golf star who just captured a record third consecutive U.S. Amateur title, has turned professional, he announced in a statement on Tuesday. "This is to confirm that, as of now, I am a professional golfer," Woods said in a statement released by the Greater Milwaukee Open, where he was expected to debut on Thursday on the Professional Golf Association circuit. He scheduled a news conference for Wednesday afternoon. According to the New York Times, the charismatic Woods has already signed a $40 million, five-year endorsement contract with Nike Inc., and a $3 million, three-year contract with golf equipment maker Titleist. On Sunday, Woods became the first golfer to win the U.S. Amateur title in three straight years. He also won U.S. Junior Amateurs in 1991, 1992 and 1993 and joined the legendary Bobby Jones as the only golfers to win USGA events in six straight years. Jones won the U.S. Amateur or U.S. Open in every year from 1923 to 1930. Woods never led until sinking a short par putt after Steve Scott had missed a seven-footer on the 10th hole -- the 38th of the day and 164th of the week-long tournament for both players. Woods trailed by as many as five holes during the 36-hole match-play final and by two holes with just three to play. The Stanford student became the youngest U.S. Amateur champion in 1994 and edged Buddy Marucci last year in Newport, Rhode Island, to become the ninth back-to-back winner and first since Jay Sigel captured consecutive titles in 1982-83. Woods has participated in 17 professional events since 1992, making seven cuts. His best finish was a tie for 22nd at July's British Open. 3722 !GCAT !GSPO Stefan Edberg produced some of his vintage best on Tuesday to extend his grand run at the Grand Slams by toppling Wimbledon champion Richard Krajicek in straight sets at the U.S. Open. Edberg, competing in the 54th consecutive and final Grand Slam event of his illustrious career, turned back the clock at Stadium Court with a flowing 6-3 6-3 6-3 serve-and-volley victory over the fifth-seeded Dutchman. "It's a win that I can be proud of," said the 30-year-old Swede, winner of two U.S. Opens and six Grand Slam titles in all. "It's never easy to beat the Wimbledon champion." Edberg, who has said he will retire at season's end, made it look easy under gray skies at the National Tennis Centre. The unseeded Swede struck quickly, breaking Krajicek in the first game and never let loose his grip on the one hour 44 minute match as he served and volleyed with the grace that made him one of the dominant players of his time. "There's not doubt about it, Richard was definitely off his game and I took advantage," said Edberg. "I still have my days where I feel great out there." Also reaching the second round were top-seeded defending champion Pete Sampras, a 6-2 6-2 6-1 winner over last minute replacement Jimy Szymanski of Venezuela, called on after Adrian Voinea of Romania withdrew because of a sprained ankle. Third seed Thomas Muster of Austria also charged into the second round with a 6-1 7-6 (7-2) 6-2 romp over Javier Frana of Argentina. Marcelo Rios of Chile, the 10th seed, also advanced. Rios claimed a 4-6 6-1 6-4 6-2 victory over Romania's Andrei Pavel. On the women's side, second seed Monica Seles got off to a strong start by beating fellow-American Anne Miller 6-0 6-1 and was joined in the second round by Spain's Arantxa Sanchez Vicario (seeded third), Olympic champion Lindsay Davenport (8) and Karina Habsudova of Slovakia (17). The women's draw lost another seed when Austrian Judith Wiesner overcame Iva Majoli of Croatia 2-6 6-3 6-1. The fifth- seeded Majoli joined Anke Huber (5) and Magdalena Maleeva (12) on the sidelines. 3723 !GCAT !GSPO It hurts Thomas Muster's surgically repaired left knee to play on the U.S. Open hardcourts, but that pain is nothing compared to his discomfort with everything associated with this Grand Slam tournament. "It would take me 100 years to adjust to all of this," Muster said after beating Argentine Javier Frana 6-1 7-6 6-2 in the opening round on Tuesday. "Unfortunately, the tournament is only two weeks." Top-seeded defending champion Pete Sampras, meanwhile, was in a comfort zone despite starting against an unexpected opponent. Sampras breezed to a 6-2 6-2 6-1 win over lucky loser Jimy Szymanski of Venezuela, who was inserted into the draw just before the match when Romanian Adriana Voinea pulled out with an ankle injury. This year, Muster's dislike of the tournament was roused even before the Austrian left-hander crushed his first groundstroke as he was dropped one spot from his ATP ranking to a number three seeding. Muster, who pulled out of Wimbledon after being seeded seventh despite ranking number two, was among the most vocal critics of the Open seedings and the way the draw was conducted. Tournament officials eventually remade the draw. "The only thing which scared me at the beginning of this touranment was every morning I'd wake up, I had the fear that I didn't know who I played," Muster said. "Every morning I went to look at the draw. Maybe I would see (retired Dutchman) Tom Okker or somebody. I looked careful at the draw every morning. "Finally they got it together, so it's all right." Muster has never felt at ease coming into the Open where he has never gotten past the quarter-finals in eight tries. "You have to serve better," Muster said of the changes he needs to make for the Open. "You cannot play defensive, you have to play offensive sometimes. "You don't have such a good chance to come back here when you're down. You can fight back on clay." Whether he makes those changes or not doesn't worry Muster. "There is no pressure on me," said Muster, whose career has been made on clay courts where he has won 39 of his 41 career titles, including the 1995 French Open. "I'm almost 29 years old, I don't have to prove anybody anything." Sampras shook off the surprise of facing a substitute opponent to take his appointed place in the second round. "I found out about 40 minutes before the match that I'd be playing someone I've never seen before," said Sampras, aiming to end his 1996 Grand Slam title drought. "(Coach Paul) Annacone ran off and asked a few guys about him." Sampras said he picked up some clues about the Venezuelan's game during their warm-up. "I could tell from his grip changes that he was probably a clay court player and he's from South America," Sampras deduced. "For a first-round match I played pretty well." The end of the day programme brought a fourth seed tumbling, as 10th seed Kimiko Date of Japan, a Wimbledon semifinalist, fell to 53rd-ranked American Kimberly Po 6-2 7-5. Two other familiar women's names were also erased. American Jennifer Capriati was dropped by Australian Annabel Ellwood, a lucky loser from the qualifying tournament, 6-4 6-4, while U.S. veteran Pam Shriver, appearing in her 18th Open, lost to France's Sandrine Testud 7-5 6-2. Ellwood's brother, qualifier Ben Ellwood, was a first-round loser, falling 6-2 6-4 6-3 to Czech Jiri Novak, who next meets Sampras. A better-known Australian casualty was former Wimbledon champion Pat Cash, who crashed 6-4 6-3 6-2 to Russian Andrei Olhovskiy. One of this year's Wimbledon surprises, Briton Tim Henman, advanced 6-2 6-3 6-4 over Roberto Jabali of Brazil. The 28th-ranked Edberg won the important points against Krajicek, gliding in behind his twisting kick-serve while on the attack and placing service returns at the feet of the net- charging Krajicek. He won 51 points on his approaches to the net, 21 more than the big-serving Dutchman, who belted 13 aces but also six double faults. A forehand service return winner gave Edberg his second match point, which he converted on Krajicek's last double fault. The victory improved Edberg's awesome Grand Slam match record to 175-46. His next opponent will be Germany's Bernd Karbacher. "I just wasn't aggressive at all. I was very lazy with my volleys," said Krajicek, whose defeat guarantees four different Grand Slam winners this season for the first time since 1991, the first year of Edberg's back-to-back Open triumphs. Australian Open champion Boris Becker and French winner Yevgeny Kafelnikov both withdrew prior to the Open. "He was much more aggressive and that was the big difference," said Krajicek, 24. Edberg had trailed head-to-head against Krajicek 4-2 and lost his last two matches against him this year on clay. But the last two times the two met at the U.S. Open, the Swede had prevailed including a come-from-behind, five-set victory that helped propel Edberg to his 1992 title. The Swede made it a sweet three in a row against Krajicek on the hardcourts in Flushing Meadows and made him the first Wimbledon champion to lose in the first round of the Open since Edberg himself in 1990. "You could see it, he wanted it more badly than I did," said Krajicek. "That's the mark of a great champion. He's still got the aggressiveness. He still wants to win every match." 3724 !GCAT !GSPO Monica Seles was missing her booming first serve but little else on Tuesday as she outslugged American Anne Miller 6-0 6-1 in her opening match at the U.S. Open. Seles, whose injured left shoulder limits her range of motion from the service line, got a good workout on Stadium Court despite the lopsided score as she traded hard groundstrokes for 55 minutes with the 19-year-old Miller. On the men's side, third seed Thomas Muster of Austria also started with a flourish on an overcast day that threatened rain as he demolished Argentine Javier Frana 6-1 7-6 (7-2) 6-2. Top-seeded defending champion Pete Sampras looked poised to follow suit as he followed Seles onto centre court against a replacement player. Lucky loser Jimy Szymanski of Venezuela, who failed to make it through the qualifying, was summoned at the last minute to replace Romanian Adrian Voinea, who withdrew with a sprained ankle. The women's draw continued to show cracks in the form charts. A third women's seed fell when Austrian Judith Wiesner overcame fifth seed Iva Majoli of Croatia 2-6 6-3 6-1. Majoli joined Germany's Anke Huber (seeded six) and Bulgarian Magdalena Maleeva (12) on the sidelines. Co-world number one Seles was not her usually bubbly self on court or in the post-match interview, taking a more serious minded approach to the season's final Grand Slam event. "Last year I was happy go lucky. This year I'm more focused," explained a sombre Seles, who returned to the Grand Slam stage last year after a two and a half year absence due to the stabbing attack she suffered in Hamburg. "This was a really good match. There were a lot of long points and some close games," said Australian Open champion Seles, strangely silent on court during rallies that in the past were punctuated by grunts and shrieks. Seles celebrated her return to the Grand Slam stage last year with electrifying style. She seemed to be everywhere during the fortnight, appearing at a music awards show, winning ovations at department stores and restaurants, attending Broadway shows and even appearing on the sidelines of an NFL Monday night football game. Then there was the tennis. She charged through the championships on adrenalin as much as anything, shaking off the rust of her long layoff to reach the final where she finally fell in a thrilling, three-set showdown against Steffi Graf. Seles got back into the Grand Slam winner's circle at Melbourne, winning her ninth slam title at the Australian Open. Since then a tear in her shoulder has soured Seles and her tennis. She lost in the quarters at the French, in the second round at Wimbledon and could not get past the quarters at the Olympics. A tournament title earlier this month in Montreal where she beat rival Arantxa Sanchez Vicario in the final, has given a boost to Seles, who has kept a low New York profile this time. "I feel really good physically other than the shoulder," said the 22-year-old Seles. "Last year after every match I was getting cramps. I was playing on adrenalin." Miller, who held five breakpoints in the third game of the first set that went seven deuces, said Seles was impressive. "If I was playing somebody else and I hit a deep cross court shot they would usually go into a defensive mode," said Miller, who came up the U.S. junior ranks with Olympic champion Lindsay Davenport and Chanda Rubin. "But Seles just hits it back even deeper and harder." Seles said she is not able to hit a really crisp, kick serve and may have to hit her serves flatter to get more speed. Shoulder surgery may be in the future for Seles, who is putting off a decision until after the U.S.-Spain Federation Cup final later this month in Atlantic City. "If I have surgery it is a long rehab, maybe six months," said Seles, understandably burdened by the prospects. "Maybe there is a chance at avoiding it through other approaches, so we'll see. "It's hard to lose so much time again, months and months." Sampras made swift work of his first-round match, beating Szymanski 6-2 6-2 6-1, and eighth-seeded Davenport joined Seles into the second round with a 6-2 6-1 win over Italian Adriana Serra-Zanetti. 3725 !GCAT !GSPO Results of first round matches on Tuesday in the U.S. Open tennis championships at the National Tennis Centre (prefix denotes seeding): Women's singles 2-Monica Seles (U.S.) beat Anne Miller (U.S.) 6-0 6-1 Rita Grande (Italy) beat Alexia Dechaume-Balleret (France) 6-3 6-0 Judith Wiesner (Austria) beat 5-Iva Majoli (Croatia) 2-6 6-3 6- 1 Men's singles 3-Thomas Muster (Austria) beat Javier Frana (Argentina) 6-1 7-6 (7-2) 6-2 Men's singles 1-Pete Sampras (U.S.) beat Jimy Szymanski (Venezuela) 6-2 6-2 6 -1 Jiri Novak (Czech Republic) beat Ben Ellwood (Australia) 6-2 6- 4 6-3 Women's singles Mariaan de Swardt (South Africa) beat Dominique Van Roost (Belgium) 1-6 6-2 7-6 (7-4) Florencia Labat (Argentina) beat Kathy Rinaldi Stunkel (U.S.) 6 -2 6-2 Nathalie Tauziat (France) beat Angelica Gavaldon (Mexico) 7-6 (7-4) 6-2 Paola Suarez (Argentina) beat Marianne Werdel Witmeyer (U.S.) 6 -4 6-3 Ann Grossman (U.S.) beat Silvia Farina (Italy) 6-4 6-3 Men's singles Alex Corretja (Spain) beat Byron Black (Zimbabwe) 7-6 (8-6) 3-6 6-2 6-2 Scott Draper (Australia) beat Galo Blanco (Spain) 6-3 7-5 6-3 Petr Korda (Czech Republic) beat David Caldwell (U.S.) 6-3 3-6 6-3 7-5 Bohdan Ulihrach (Czech Republic) beat 14-Alberto Costa (Spain) 2-6 6-4 7-6 (7-2) 3-6 6-1 Bernd Karbacher (Germany) beat Jonathan Stark (U.S.) 7-5 6-3 5- 7 7-5 Women's singles 8-Lindsay Davenport (U.S.) beat Adriana Serra-Zanetti (Italy) 6 -2 6-1 Elena Wagner (Germany) beat Gigi Fernandez (U.S.) 6-1 6-4 Kristie Boogert (Netherlands) beat Joannette Kruger (South Africa) 6-1 6-0 Men's singles Stefan Edberg (Sweden) beat 5-Richard Krajicek (Netherlands) 6- 3 6-3 6-3 10-Marcelo Rios (Chile) beat Andrei Pavel (Romania) 4-6 6-1 6-4 6-2 Women's singles 3-Arantxa Sanchez Vicario (Spain) beat Laxmi Poruri (U.S.) 6-2 6-1 Men's singles Andrei Olhovskiy (Russia) beat Pat Cash (Australia) 6-4 6-3 6-2 Filippo Veglio (Switzerland) beat Christian Ruud (Norway) 1-6 6 -2 6-4 6-4 Tim Henman (Britain) beat Roberto Jabali (Brazil) 6-2 6-3 6-4 Pablo Campana (Ecuador) beat Todd Woodbridge (Australia) 6-2 4- 6 6-2 6-4 Herman Gumy (Argentina) beat Martin Damm (Czech Republic) 7-5 6 -4 7-5 Jacob Hlasek (Switzerland) beat Nicklas Kulti (Sweden) 6-3 6-4 4-6 6-4 Women's singles 17- Karina Habsudova (Slovakia) beat Radka Bobkova (Czech Republic) 6-4 6-1 Karin Kschwendt (Austria) beat Sandra Kleinova (Czech Republic) 6-3 6-4 Annabel Ellwood (Australia) beat Jennifer Capriati (U.S.) 6-4 6 -4 Nicole Arendt (U.S.) beat Sandra Cacic (U.S.) 6-2 7-6 (8-6) Elena Likhovtseva (Russia) beat Kyoko Nagatsuka (Japan) 7-6 (7- 5) 6-1 Sandrine Testud (France) beat Pam Shriver (U.S.) 7-5 6-2 Women's singles Kimberly Po (U.S.) beat 10-Kimiko Date (Japan) 6-2 7-5 Natasha Zvereva (Belarus) beat Virginia Ruano-Pascual (Spain) 6 -2 6-7 (5-7) 6-2 Tina Kirzan (Slovakia) beat Rika Hiraki (Japan) 7-6 (7-4) 7-5 Petra Langrova (Czech Republic) beat Karina Adams (U.S.) 6-4 6-2 Tami Whitlinger Jones (U.S.) beat Sandra Cecchini (Italy) 6-2 6-0 7-Jana Novotna (Czech Republic) beat Francesca Lubiani (Italy) 6-1 7-5 Men's singles 13-Thomas Enqvist (Sweden) beat Stephane Simian (France) 6-3 6-1 6-4 Men's singles Mikael Tillstrom (Sweden) beat Tamer El Sawy (Egypt) 1-6 7-6 (9 -7) 6-1 3-6 6-4 Roberto Carretero (Spain) beat Jordi Burillo (Spain) 6-3 4-6 6- 0 1-0 Retired (ankle injury) Thomas Johansson (Sweden) beat Renzo Furlan (Italy) 4-6 2-6 7-5 6-1 7-5 Mark Knowles (Bahamas) beat Marcelo Filippini (Uruguay) 6-3 7-5 6-1 Jared Palmer (U.S.) beat 15-Marc Rosset (Switzerland) 6-7 (7-9) 6-4 6-4 6-3 Women's singles Amy Frazier (U.S.) beat Larisa Neiland (Latvia) 6-1 6-3 Women's singles Lisa Raymond (U.S.) beat Lori McNeil (U.S.) 7-6 (8-6) 6-3 Sandra Dopfer (Austria) beat Zina Garrison Jackson (U.S.) 2-6 6-3 7-5 4-Conchita Martinez (Spain) beat Ruxandra Dragomir (Romania) 6-2 6-0 Naoko Sawamatsu (Japan) beat Rennae Stubbs (Australia) 6-4 6-3 Miriam Oremans (Netherlands) beat Radka Zrubakova (Slovakia) 6-2 4-6 6-1 Men's singles Doug Flach (U.S.) beat Gianluca Pozzi (Italy) 7-5 7-6 (7-5) 2-6 7-6 (8-6) 16-Cedric Pioline (France) beat Francisco Clavet (Spain) 6-4 7-6 (7-3) 6-4 Javier Sanchez (Spain) beat David Skoch (Czech Republic) 6-2 7-6 (7-0) 6-3 Women's singles, first round 1-Steffi Graf (Germany) beat Yayuk Basuki (Indonesia) 6-3 7-6 (7-4) 3726 !GCAT !GSPO Major League Baseball standings after games played on Monday (tabulate under won, lost, winning percentage and games behind): AMERICAN LEAGUE EASTERN DIVISION W L PCT GB NEW YORK 74 56 .569 - BALTIMORE 69 61 .531 5 BOSTON 67 65 .508 8 TORONTO 62 70 .470 13 DETROIT 47 84 .359 27 1/2 CENTRAL DIVISION CLEVELAND 78 53 .595 - CHICAGO 70 63 .526 9 MINNESOTA 65 66 .496 13 MILWAUKEE 63 69 .477 15 1/2 KANSAS CITY 59 73 .447 19 1/2 WESTERN DIVISION TEXAS 75 56 .573 - SEATTLE 67 63 .515 7 1/2 OAKLAND 63 71 .470 13 1/2 CALIFORNIA 61 70 .466 14 TUESDAY, AUGUST 27TH SCHEDULE CLEVELAND AT DETROIT OAKLAND AT BALTIMORE MINNESOTA AT TORONTO MILWAUKEE AT CHICAGO TEXAS AT KANSAS CITY BOSTON AT CALIFORNIA NEW YORK AT SEATTLE NATIONAL LEAGUE EASTERN DIVISION W L PCT GB ATLANTA 81 48 .628 - MONTREAL 70 59 .543 11 FLORIDA 61 70 .466 21 NEW YORK 59 72 .450 23 PHILADELPHIA 53 79 .402 29 1/2 CENTRAL DIVISION HOUSTON 70 62 .530 - ST LOUIS 69 62 .527 1/2 CHICAGO 64 64 .500 4 CINCINNATI 64 66 .492 5 PITTSBURGH 55 75 .423 14 WESTERN DIVISION SAN DIEGO 72 60 .545 - LOS ANGELES 70 60 .538 1 COLORADO 69 63 .523 3 SAN FRANCISCO 56 73 .434 14 1/2 TUESDAY, AUGUST 27TH SCHEDULE PHILADELPHIA AT SAN FRANCISCO LOS ANGELES AT MONTREAL ATLANTA AT PITTSBURGH SAN DIEGO AT NEW YORK CHICAGO AT HOUSTON FLORIDA AT ST LOUIS CINCINNATI AT COLORADO 3727 !GCAT !GSPO William VanLandingham pitched eight scoreless innings and Glenallen Hill drove in the game's only run with a first-inning single as the San Francisco Giants claimed a 1-0 victory over the Philadelphia Phillies on Monday. VanLandingham (8-13), who entered the game with one complete game in the first 56 starts of his career, limited the Phillies to two hits and two walks with four strikeouts. "We've been working all year on my follow-through, and I really concentrated on that," VanLandingham said. "It gave me more life in all of my pitches, so the ball moved more." At Colorado, Andres Galarraga homered and drove in three runs as the Colorado Rockies had 10 extra-base hits and Billy Swift won his first game in almost a year in a 9-5 rain-shortened seven-inning victory over the Cincinnati Reds. Swift (1-0), who made his first start since June 3rd and underwent arthroscopic surgery on his right shoulder earlier in the season, allowed five runs and six hits in five innings. In Houston, Andy Benes allowed two runs over seven innings and Royce Clayton had a run-scoring single in the seventh to lift the St. Louis Cardinals to a 3-2 victory over the Houston Astros. Benes (14-9) allowed five hits, walked five and struck out 10 for his 11th win in 12 decisions. The Cardinals moved within one-half game of first-place Houston in the National League Central Division. 3728 !GCAT !GSPO Cal Ripken's bases-loaded walk scored Brady Anderson with the winning run in the bottom of the 10th as the Baltimore Orioles regained control of the top spot in the wild-card race with a wild 12-11 victory over the Oakland Athletics. Trailing by a run entering the 11th, the Orioles rallied against Oakland reliever Mark Acre (0-2) with a walk and a triple by Brady Anderson to tie the game. Then Oakland manager Art Howe decided to intentionally walk Rafael Palmeiro and Bobby Bonilla to load the bases but Acre was nowhere near the plate to Ripken. The decisive pitch nearly hit Ripken and gave the Orioles a one-half game lead over the Chicago White Sox in the wild-card race. In Seattle, Jay Buhner's eighth-inning single snapped a tie as the Seattle Mariners edged the New York Yankees 2-1 in the opener of a three-game series. New York starter Jimmy Key left the game in the first inning after Seattle shortstop Alex Rodriguez lined a shot off his left elbow. The Yankees have lost 12 of their last 19 games and their lead in the AL East over Baltimore fell to five games. At California, Tim Wakefield pitched a six-hitter for his third complete game of the season and Mo Vaughn and Troy O'Leary hit solo home runs in the second inning as the surging Boston Red Sox won their third straight 4-1 over the California Angels. Boston has won seven of eight and is 20-6 since August 2nd. The Red Sox are two games over .500 for the first time this season. In Chicago, Cal Eldred pitched 5-1/3 scoreless innings and John Jaha scored one run and doubled in another as the Milwaukee Brewers held off the slumping Chicago White Sox, 3-2. Eldred (6-5) walked one and struck out three. Angel Miranda retired one batter and Bob Wickman retired the next four but loaded the bases in the eighth. In Detroit, Jim Thome's solo homer in the ninth inning snapped a tie and Charles Nagy pitched a three-hitter for his first win in over a month, leading the Cleveland Indians to their 11th straight victory over the Detroit Tigers, 2-1. With the score tied 1-1 in the ninth, Thome hit a 2-2 pitch from starter Felipe Lira (6-11) over the left-field fence for his 29th homer. In Toronto, Juan Guzman allowed three runs over seven innings to make homers by Joe Carter and Carlos Delgado stand up as the surging Toronto Blue Jays held off the Minnesota Twins, 5-3. Toronto returned home from a 10-game road trip and won for the eighth time in nine games as Guzman (11-8) allowed nine hits and struck out eight without a walk. 3729 !GCAT !GSPO Results of Major League Baseball games played on Monday (home team in CAPS): American League Cleveland 2 DETROIT 1 BALTIMORE 12 Oakland 11 (10 innings) TORONTO 5 Minnesota 3 Milwaukee 3 CHICAGO 2 Boston 4 CALIFORNIA 1 SEATTLE 2 New York 1 National League SAN FRANCISCO 1 Philadelphia 0 St Louis 3 HOUSTON 2 COLORADO 9 Cincinnati 5 3730 !GCAT !GSPO Andre Agassi, at the centre of a controversy not of his own making, began his 1996 U.S. Open campaign by recording his 100th career Grand Slam match win. The 1994 U.S. Open champion and twice runner-up rolled past 119th-ranked Mauricio Hadad of Colombia 6-3 6-3 6-2 in 92 minutes on Monday night. "I thought I went out there and took care of business from start to finish and based on that I couldn't be more pleased," said Agassi, who wore a long-sleeved jersey in solid blue save for the omnipresent Nike logo. Agassi broke out of a four-month slump, which included miserable showings at the French Open and Wimbledon, by winning the men's singles Olympic gold medal in Atlanta earlier this month -- a feat he considers life-changing. "The Olympics is not just a year making event, it's career making," he gushed. But while still riding his gold-medal high, Agassi found himself drawn into a battle royal between the ATP Tour and the U.S. Tennis Association brass. Agassi was chief beneficiary of the USTA decision to deviate from the computer rankings in making the seedings when he was promoted from last week's ranking of eight to the sixth seeding. A near insurrection erupted when irate players fumed over the demotion of top Europeans Thomas Muster and Yevgeny Kafelnikov while charging that the USTA decided to monkey around with the seedings in part to keep Agassi from running into Pete Sampras before the final weekend. While the top players were almost unanimous in their scorn for what they considered a lack of respect for the ATP rankings, Agassi on Monday broke ranks and defended the USTA. "I don't worry about really where I'm seeded," said the popular Las Vegan who won the U.S. Open as an unseeded player. "I got the better end of the deal," he admitted. "By the same token I was a little disappointed with the ATP choosing this as their fight to fight. Agassi said he was prepared to give tournament officials the benefit of the doubt and he was none too pleased to find the ATP holding him up as an example in its charges of USTA tampering with the draw. "I've gone to bat for the ATP and it's kicked me in the ass in more than a few ways," he said. "I'm just thinking about my tennis to be quite honest," he insisted. "If I can put together a couple of good weeks and finish strong and maybe win then I can consider this a great year." Back on the field of play, a pair of women's seeds were sent packing on opening day of the year's final Grand Slam. Sixth-seeded German Anke Huber, this year's Australian Open runner-up, fell victim to a miserable draw, beaten 6-1 2-6 6-2 by 17th-ranked South African Amanda Coetzer. "I wasn't happy when I saw it," she said of her first-round assignment. "She was the first non-seeded player. I wasn't happy with the draw at all, that's for sure." Also gone is 12th seed Magdalena Maleeva of Bulgaria, picked off by Polish youngster Aleksandra Olsza. And three more familiar faces joined a lengthy list of withdrawals due to injury. Former number one players Mats Wilander and Jim Courier, who was to be seeded eighth, pulled out on Monday, as did women's ninth seed Mary Joe Fernandez. American Chanda Rubin, who would have been seeded 11th and French Open champion Yevgeny Kafelnikov withdrew late last week. The fourth-ranked Russian star offically suffers from a rib injury, but claimed hurt feelings over the rankings snub in a later statement. "I feel bad for Yevgeny," Agassi said. "I personally feel he's a better player than seven, no question." A pair of Agassi's seeded compatriots preceded him into the second round Monday. Michael Chang, promoted from third in the world to the second seed, shook off some opening day jitters to post a 3-6 6-1 6-0 7-6 win over Brazilian Jaime Oncins, the man Jimmy Connors beat for his final U.S. Open victory. And surprise Wimbledon runner-up MaliVai Washington, seeded 11th, scored a four-set win over Karim Alami of Marocco on a hot summer day at the National Tennis center Tuesday's star-crammed second-day schedule features openers for top-seeded defending champions Pete Sampras and Steffi Graf as well as first-round matches for women's co-number one Monica Seles, Olympic gold medalist Lindsay Davenport and third seeds Thomas Muster and Arantxa Sanchez Vicario. Two-time U.S. Open winner Stefan Edberg will also make what could be his final Grand Slam appearance unless he can get past reigning Wimbledon champ Richard Krajicek, the fifth seed. "I think Stefan Edberg is a professional that every young person, every athlete should strive to emulate," Agassi said in tribute to the retiring Swede. 3731 !GCAT !GSPO During a three-month layoff this year Gabriela Sabatini took singing lessons, and on Monday the former U.S. Open champion was singing a happy tune upon her return to the Grand Slam wars. "I mean, I can't ask for something better than that," said the 15th-seeded Sabatini after easing past Canadian Patricia Hy-Boulais 6-1 6-1 under the National Tennis Centre stadium lights. "I played a great match. I was just dictating the whole time. Everything worked very well. I was moving very well and hitting the ball very well." Sabatini has had little reason to be so upbeat this year. She had played just four tournaments before a pulled stomach muscle in early April forced the 26-year-old Argentine to miss both the French Open and Wimbledon for the first time since 1985. "Watching the French Open and Wimbledon on tv when I was home, that was very hard," said Sabatini, who finally returned to play at the Olympics. "Just not being there, it felt strange. Everybody was there and I wasn't. I missed a lot just walking out on that centre court at those tournaments. "That's why today was really special when I walked into the stadium, that thought came to my mind, that a few months ago I was home watching this and now I'm here." The U.S. Open has a special place in the popular Argentine's heart for it was here in 1990 that she claimed her lone Grand Slam singles title with a victory in the final over longtime rival Steffi Graf. "I just feel like I'm extra motivated here more than any other tournament," said Sabatini, a U.S. Open semifinalist the last two years. "I just love to play here in New York. I'm just feeling good." 3732 !GCAT !GSPO Michael Chang is playing in his 10th U.S. Open and enjoying his highest seeding ever, but the 24-year-old American had to overcome a case of the jitters Monday before winning his first-round match on opening day. Chang, seeded second behind defending champion Pete Sampras, took two hours 40 minutes to defeat 186th-ranked Jaime Oncins of Brazil 3-6 6-1 6-0 7-6, 8-6 in the tiebreaker. "I was pretty tight the whole match," conceded Chang, one of the hottest players on tour this summer with a 16-2 record on hardcourts that included two titles and a runner-up finish. "Everyone has moments when they get tight. Hopefully, this will have been my nerves for the whole tournament." Joining Chang into the second round was Wimbledon runner-up MaliVai Washington, the 11th seed, who also needed four sets to get past talented Moroccan Karim Alami 6-4 2-6 7-6 (7-5) 6-1. Washington's win was not comfortable, either. The 27-year-old American hurried off the Stadium Court for treatment of an upset stomach after his two and a half hour struggle against Alami. "Towards the end of my match my stomach felt like week-old sushi," said Washington. "Maybe it was a combination of the heat and something I ate." Chang and Washington were the only men's seeds in action on a day that saw two seeded women's players fall. Australian Open runner-up Anke Huber of Germany, the sixth seed, was undone by an unlucky draw that put her against 17th ranked South African Amanda Coetzer in her opening match. Coetzer claimed revenge for the semifinal defeat she suffered to Huber in Melbourne by taking a 6-1 2-6 6-2 victory. Last year's Wimbledon junior champion, Aleksandra Olsza of Poland, removed another seed from the draw by eliminating number 12 Magdalena Maleeva of Bulgaria 6-4 6-2. Other men's winners included a pair of former Grand Slam tournament champions whose victories set up a showdown in the second round. Germany's Michael Stich, the 1991 Wimbledon champion, and two-time French Open winner Sergi Bruguera of Spain will face each other next after beating German Tommy Haas 6-3 1-6 6-1 7-5, and Belgian Kris Goossens 6-2 6-0 7-6 (7-1), respectively. Alex O'Brien, who scored his first professional title eight days ago in New Haven, advanced to the second round with a 6-4 1-6 6-4 6-3 win over Ecuador's Nicolas Lapentti. Wimbledon bad boy Jeff Tarango caught a break Monday when he advanced after the retirement of German Alex Radulescu due to heat exhaustion. Tarango was leading 6-7 (5-7) 6-4 6-1 3-1. Chang blamed breezy conditions for some of the erratic play in his match with Oncins, who had beaten him in the round of 32 at the 1992 Barcelona Olympics. Chang committed an untidy 53 unforced errors, though he made seven fewer than the Brazilian, who also walloped a woeful 24 double faults. The most deflating double fault came when Oncins was serving to force a fifth set, leading 6-4 in the tiebreaker. The set point came after confusion at the net on the point previous, which was awarded to Oncins after the two exchanged shots at close quarters at the net. First Chang approached the umpire, then Oncins, then Chang again before play finally resumed. "Those little seconds were like an hour to me," said Oncins, who promptly fired two serves barely contained by the baseline as he frittered away his best chance. Chang ran off the next three points to close out the match but for Oncins, the contest was a personal victory. The 26-year-old Brazilian had risen into the top 30 in 1992. The next year a close friend was struck by a stray bullet while riding home in a car from a soccer game in Sao Paulo. He died slumped against Oncins, who subsequently lost interest in tennis. "Two months ago I started talking about quitting," said Oncins, who decided to give it one last try and made it through the Open qualifying tournament last weekend. "I believe in my game again," he said. At the end of the day, a spate of withdrawals from the tournament were announced. Eighth seed Jim Courier withdrew because of a bruised right knee, and 1988 Open champion Mats Wilander bowed out due to a groin pull, organisers said. Women's ninth seed Mary Joe Fernandez pulled out because of tendinitis in her right wrist. 3733 !GCAT !GSPO Schedule of Tuesday's featured matches on the show courts at the U.S. Open (prefix number denotes seeding): Day session Stadium court, beginning 11:00 am (1500 GMT) 2-Monica Seles (U.S.) v Anne Miller (U.S.) 1-Pete Sampras (U.S.) v Adrian Voinea (Romania) Stefan Edberg (Sweden) v 5-Richard Krajicek (Netherlands) Grandstand: 3-Thomas Muster (Austria) v Javier Frana (Argentina) 8-Lindsay Davenport (U.S.) v Adriana Serra-Zanetti (Italy) 3-Arantxa Sanchez Vicario (Spain) v Laxmi Poruri (U.S.) Jennifer Capriati (U.S.) v Annabel Ellwood (Australia) Night session Stadium, beginning 7:30 pm (2330 GMT) 1-Steffi Graf (Germany) v Yayuk Basuki (Indonesia) 4-Goran Ivanisevic (Croatia) v Andrei Chesnokov Grandstand Mark Woodforde (Australia) v Mark Philippoussis (Australia) 3734 !GCAT !GSPO Summary of a French first division soccer match on Tuesday: Auxerre 0 Marseille 0. Attendance: 20,000 3735 !GCAT !GSPO VfB Stuttgart stormed to the top of the Bundesliga on Tuesday and maintained their 100 percent record by winning 4-0 away at Hamburg. Stuttgart's win gave them a maximum nine points from their first three games and further boosted caretaker coach Joachim Loew's chances of taking over the job permanently. Champions Borussia Dortmund moved up to second spot with a 3-1 home win over Freiburg. An early goal from former Lazio striker Karlheinz Riedle put Dortmund on their way and strikes from Joerg Heinrich and Rene Tretschock secured the victory. Bulgarian playmaker Krasimir Balakov gave Stuttgart a 1-0 lead at halftime in Hamburg and the visitors turned on the style in the second half with two goals from striker Fredi Bobic and a late strike from Matthias Hagner. "I'd like to compliment my team," said Loew, who stepped up from being assistant coach after Rolf Fringer left to run the Swiss national side just before the start of the season. "We could have scored even more goals in the second half." Borussia Moenchengladbach had two players sent off in a bad tempered match in Bremen. The home side triumphed 1-0 for their first win of the season. 3736 !GCAT !GSPO Former European champions Marseille held French champions Auxerre to a goalless draw in a lacklustre league match on Tuesday. The bill looked promising but both sides, struggling to find their form early in the season, were disappointing. Auxerre, who start their European Cup campaign next week against Ajax Amsterdam, dominated the match but were unable to score. Unbeaten in four matches, they still trail leaders Lens by one point. Lens, who have won all their three league matches so far, host Montpellier on Wednesday night. Despite another dismal performance, especially in defence, Marseille restored some pride by keeping the reigning champions at bay after losing 2-1 at home to Metz last Saturday. After two seasons in the second division and after taking on half a dozen new recruits this season, some of whom do not speak a word of French, Marseille are not playing with any fluidity. But German international goalkeeper Andreas Koepke again proved a sound investment when under pressure from the Auxerre strikers, saving his team with a number of fine parries. Marseille now lie seventh in the league on five points. 3737 !GCAT !GSPO Result of a French first division soccer match played on Tuesday: Auxerre 0 Marseille 0 3738 !GCAT !GSPO A four-goal blitz inside three minutes helped Finland to a 7-3 victory over reigning world champions the Czech Republic in their ice hockey World Cup opener on Tuesday. The Czechs took the lead in the seventh minute, Radek Bonk picking up a stray pass from Finnish defender Jyrki Lumme. But spearheaded by North American Hockey League forwards Saku Koivu, Ville Peltonen, Juha Ylonen and Teemu Selanne, Finland equalised and then went 3-1 up inside 40 seconds. Koivu, of the Montreal Canadiens, set up the crucial equaliser with a brilliant pass from behind the Czech goal. Frustrated Czech goaltender Roman Turek left the ice after the three-goal barrage, but his replacement Petr Briza fared little better, failing to save a shot by Lumme less than two minutes later. In the second period, Janne Ojanen netted for Finland to make the score 5-1 before the Czechs pulled one back through a Robert Reichel penalty shot. With the result beyond doubt, the third period lacked the pace and energy of the previous two, and both teams were content to play at half-speed, saving strength for the tight World Cup schedule to come. In the European group, Finland play Germany on Wednesday in Helsinki. The Germans were beaten 6-1 by Sweden in their opening match on Monday. The Czech Republic play Sweden in Prague on Thursday. Canada, the United States, Russia and Slovakia meet in the other group, known as the North American group. The World Cup is the successor to the Canada Cup, which was played in 1976, 1981, 1984, 1987 and 1991. 3739 !GCAT !GSPO Summaries of Bundesliga matches played on Tuesday: Borussia Dortmund 3 (Riedle 8th minute, Heinrich 29th, Tretschok 77th) Freiburg 1 (Decheiver 51st penalty). Halftime 2-0. Attendance 48,800. Hamburg 0 VfB Stuttgart 4 (Balakov 29th, Bobic 47th and 60th, Hagner 85th). 0-1. 31,139. Werder Bremen 1 (Schulz 31st) Borussia Moenchengladbach 0. 1-0. 24,800. Schalke 1 (Thon 2nd) Bochum 1 (Donkow 86th). 1-0. 33,230. 3740 !GCAT !GSPO Results of Bundesliga matches played on Tuesday: Borussia Dortmund 3 Freiburg 1 Hamburg 0 VfB Stuttgart 4 Werder Bremen 1 Borussia Moenchengladbach 0 Schalke 1 Bochum 1 Bundesliga standings after Tuesday's games (tabulate under played, won, drawn, lost, goals for, goals against, points): VfB Stuttgart 3 3 0 0 10 1 9 Borussia Dortmund 4 3 0 1 12 6 9 Cologne 3 3 0 0 7 1 9 Bayern Munich 3 2 1 0 7 2 7 Bayer Leverkusen 3 2 0 1 7 4 6 VfL Bochum 4 1 3 0 4 3 6 Hamburg 4 2 0 2 7 7 6 Karlsruhe 2 1 1 0 5 3 4 St Pauli 3 1 1 1 7 7 4 Werder Bremen 4 1 1 2 5 6 4 1860 Munich 3 1 0 2 3 5 3 Schalke 4 0 3 1 5 9 3 Fortuna Duesseldorf 3 1 0 2 1 7 3 Freiburg 4 1 0 3 6 13 3 Hansa Rostock 3 0 2 1 3 4 2 Arminia Bielefeld 3 0 2 1 2 3 2 Borussia Moenchengladbach 4 0 2 2 1 4 2 MSV Duisburg 3 0 0 3 1 8 0 3741 !GCAT !GSPO Italian soccer clubs like Juventus and AC Milan will soon be allowed to seek stock exchange listings, the government promised on Tuesday. At present, Italian clubs are required by law to be non-profit making organisations and they are often run by wealthy families almost as a hobby. After meeting top soccer officials on Tuesday, deputy prime minister Walter Veltroni said this system would change. "We have to make a leap forward and recognise the reality of the situation," he said. Italian soccer chiefs said they wanted to follow the English example, where a number of clubs, including Manchester United and Tottenham Hotspur, are already quoted on the stock market. League champions AC Milan, owned by media tycoon Silvio Berlusconi, have already said they would be interested in a public flotation. Italy's Serie A is arguably the world's leading league and top teams could make huge profits by expanding their merchandising activities. Soccer chiefs said they hoped the new legislation would be introduced next month. Veltroni said the government would also set up a commission to look into complaints by the soccer industry that they have to bear an unfair tax burden. 3742 !GCAT !GSPO Dutch first division summary on Tuesday: Fortuna Sittard 2 (Jeffrey 7, Roest 33) Heerenveen 4 (Korneev 15, Hansma 24, Wouden 70, 90). Halftime 2-2. 3743 !GCAT !GSPO Result of a Dutch first division soccer match played on Tuesday: Fortuna Sittard 2 Heerenveen 4 3744 !GCAT !GSPO Finland beat the Czech Republic 7-3 (period scores 4-1 1-1 2-1) in their ice hockey World Cup, European group match on Tuesday. Scorers: Finland - Ville Peltonen (10th minute), Juha Ylonen (10th), Teemu Selanne (11th), Jyrki Lumme (13th and 51st), Janne Ojanen (23rd), Christian Ruuttu (45th) Czech Republic - Radek Bonk (7th), Robert Reichel (33rd, penalty), Jiri Dopita (57th) Standings (tabulate under played, won, drawn, lost, goals for, against, points): Sweden 1 1 0 0 6 1 2 Finland 1 1 0 0 7 3 2 Czech Republic 1 0 0 1 3 7 0 Germany 1 0 0 1 1 6 0 3745 !GCAT !GSPO Swiss league leaders Neuchatel Xamax said on Tuesday they would appeal against a nine-month ban imposed on French international defender Jean-Pierre Cyprien for his part in a post-match brawl. Cyprien, also fined 10,000 Swiss francs ($8,400), traded punches with St Gallen's Brazilian player Claudio Moura after a match on Saturday. When officials and coaching staff tried to intervene, Cyprien launched a flying kick at Moura, but only succeeded in kneeing St Gallen coach Roger Hegi in the stomach. Moura, who appeared to have elbowed Cyprien in the final minutes of the 3-0 win by Neuchatel, was suspended for seven matches and fined 1,000 francs ($840) by the Swiss league disciplinary committee. Club president Gilbert Facchinetti said he was astonished the committee had arrived at its decision so quickly and vowed the club would appeal. Neuchatel coach Gilbert Gress described the incident as "shocking", but said Moura was also to blame. "Moura physically and verbally provoked Cyprien during the match. The referee could not have seen it or he would have punished him," Gress said. "During the scuffle, Moura threw the first punch. Tomorrow, if someone punches me, I would not know how to react." Cyprien, who won his one French cap against Italy in February 1994, cannot play in Switzerland or elsewhere until May next year. 3746 !GCAT !GSPO Veteran Italian Gianni Bugno has been cleared of doping after testing positive for high levels of testosterone during the Tour of Switzerland in June, the Italian cycling federation said on Tuesday. "He has been cleared. The case is closed," a spokesman said. Bugno tested positive for the banned hormone after the fifth stage of the Tour, in which he finished third overall. But the spokesman said subsequent tests in Cologne proved his body produced higher-than-average testosterone levels naturally. Bugno, who won the Giro d'Italia in 1990 and two successive world titles, was banned for three months in 1994 after testing positive for the stimulant caffeine. 3747 !GCAT !GSPO Leading results and overall standings after the 161 kilometre first stage of the Tour of the Netherlands between Gouda and Haarlem on Tuesday. 1. Federico Colonna (Italy) Mapei three hours 43 mins five secs 2. Robbie McEwen (Australia) Rabobank 3. Jans Koerts (Netherlands) Palmans 4. Sven Teutenberg (Germany) US Postal 5. Tom Steels (Belgium) Mapei 6. Endrio Leoni (Italy) Aki 7. Johan Capiot (Belgium) Collstrop 8. John den Braber (Neths) Collstrop 9. Jeroen Blijlevens (Neths) TVM 10. Michael van der Wolf (Neths) Foreldorado all same time. Leading overall standings after first stage. 1. Colonna three hours 42 mins 55 seconds 2. McEwen 0:04 seconds behind 3. Koerts 0:06 4. Gianluca Corini (Italy) Aki 0:07 5. Wim Omloop (Belgium) Collstrop same time 6. Lance Armstrong (USA) Motorola 0:08 7. Tristan Hoffman (Neths) TVM same time 8. George Hincapie (USA) Motorola 0:09 9. John Talen (Neths) Foreldorado same time 10. Teutenberg 0:10 3748 !GCAT These are the leading stories in the Malawi press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - THE NATION - Malawi president Bakili Muluzi's cash donation of more than 1.000 U.S. dollars to pacify an embroiled district governor in southern Malawi was stolen by a brief-case snatcher. The cash donation was to pacify nine governors each after Muluzi recently provoked high tempers in his party when he appointed former Blantyre city mayor Luke Jumbe to a position of southern region governor, replacing business tycoon James Makhumula who had been elected to the position. - - - - DAILY TIMES - Malawi vice president Justin Malewezi has threatened to dismiss principal secretaries and district commissioners who will not support the ruling United Democratic Front (UDF) party. - Opposition political parties have condemned management at the government controlled radio, Malawi Broadcasting Corporation (MBC) for firing a reporter and suspending his editor who last week carried an opposition party story on air. 3749 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL !GVIO Labour Minister Tito Mboweni backed a wide-ranging inquiry into South Africa's violence- plagued mining industry on Tuesday, saying some mines were still run as they were during apartheid. At least 24 miners have been killed and scores more injured in recent weeks in fights on four mines run by Gold Fields of South Africa Ltd. The violence, which has hit output, has been blamed on differences between ethnic groups and rival unions. "We are extremely concerned,'' Mboweni told a news conference after talks with National Union of Mineworkers (NUM) President James Motlatsi and Deputy Mineral Affairs Minister Susan Shabangu. The meeting was requested by Motlatsi. Mboweni said he had also discussed the violence with Gold Fields head of gold mining Alan Munro, who had been "very cooperative". The violence has affected three gold mines and one platinum operation run by Gold Fields. The labour minister said he would also have talks with police minister Sydney Mufamadi on Wednesday. South Africa's mining industry was built on a labour system whereby men left their wives and families for months at a time to work on the mines. Mine hostels were largely segregated on ethnic lines, with Zulus, Xhosas or Basotho each in separate quarters. Motlatsi told reporters he had proposed to Mboweni that a comprehensive commission of inquiry be instituted to deal with the migrant labour system and "the command structure" on mines. "The mining industry is the founder of apartheid, was a pillar of apartheid, so we need to look at that pillar to see how we make it possible to move towards the direction of democracy," the union leader said. Mboweni said he favoured the proposal and would discuss it with cabinet colleagues. "This idea of a comprehensive commission to look into the totality of living and working conditions on the mines, I think it's important. Why is it that segregation along ethnic lines still exists? What is it that causes these fights to take an ethnic dimension? "I think this proposal has a lot of sense and if the government agrees to it I think it would be good to proceed with it as soon as possible," Mboweni said. "It is quite clear that some of the root causes of this violence are historical and in a sense some of the chickens are coming home to roost at the wrong time when now there is a democratic government," Mboweni said. 3750 !E51 !ECAT !GCAT !GHEA !GPOL South African opposition parties called on Tuesday for a new probe into a foreign aid spending scandal, brushing aside efforts by President Nelson Mandela to defuse the row. Democratic Party health spokesman Mike Ellis told reporters the public protector, a state official mandated to investigate complaints against the government, should reopen a previous inquiry into Health Minister Nkosazana Zuma's financial support for an AIDS awareness play. "She (Zuma) has been covering up since day one," Ellis said. "What she has hoped all along is that the issue would just go away. We believe the public protector should once again open the investigation to reveal the truth once and for all." The National Party of former president F.W. de Klerk, now in opposition after quitting the government of national unity in June, issued a statement saying parliament should launch an investigation. The row erupted earlier this year when it emerged that Zuma had approved a 14 million rand ($3.1 million) subsidy, using European Union aid, for a Broadway-style musical "Sarafina II" intended to encourage safe sex. When opposition parties objected that this was a waste of scarce resources, the public protector began an investigation that reported in June that Zuma, among other things, had misled parliament. At the time Zuma rejected opposition demands that she resign but announced that support for the play would be withdrawn and the EU, whose money had been used without its knowledge, would get its aid back. She said a private donor who refused to be publicly identified had pledged to contribute about 10 million rand to cover the government's contractual obligations. But newspapers reported at the weekend that the donor had yet to pay the money. Mandela, who has repeatedly defended Zuma, said on Monday she was a very good minister and her critics should resolve their problems by sitting down to talk to her. "That's laughable," Ellis said, adding that the last time a parliamentary committee quizzed Zuma over Sarafina she had been arrogant, aggressive and dishonest. "One has to question if there ever was a private sponsor and why that person would want to remain anonymous," Ellis said. "One has to start to question what that person would want in return." ($1 = R4.52) 3751 !GCAT These are the leading stories in the South African press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. - - - - BUSINESS DAY - Legislation was tabled in Parliament on Monday which further toughens South Africa's criminal law, depriving criminals of the proceeds of their crimes and forcing businessmen and banks to report suspicious goods and transactions. - Transnet is planning to focus on becoming a transport operator while promoting greater private-sector involvement in the provision of infrastructure. - The rumour mill was working overtime in the markets again on Monday as speculation mounted ahead of Reserve Bank Governor Chris Stals's address to the Bank's AGM on Tuesday. - Mining house Gencor lifted income before exceptional items 47 percent to 1.5 billion rand for the year to June, propelled by mainstay aluminium operations which overshadowed setbacks elsewhere. - Northwest Province Premier Popo Molefe has announced an 18 billion dollar deal with foreign investors to import 500 Chinese factories, with 50,000 skilled workers, for the establishment of a "mini city" near Potchefstroom west of Johannesburg. - - - - BUSINESS REPORT - The petrol price in South Africa will fall if the state withdraws its sanction of the pricing arrangmements among refiners and marketers, Mineral and Energy Affairs Minister Penuell Maduna said at the weekend. - Transnet, the transport parastatal, has bowed to pressure from three trade unions representing train drivers, operators and artisans and will have to find and extra 57 million rand for wage increases for the year to avert a threatened strike. It had budgeted 270 million rand for wage increases. - A group of small business members within the National Empowerment Consortium (NEC) have joined forces to form the National Empowerment Corporation in a bid to take a significant stake in the deal for the acquisition of Anglo America's 48 percent stake in Johnic. - Gencor has achieved its ambition of totally owning the aluminium producer Alusaf after minority shareholders agreed to take the mining house's shares in payment for their stakes. - Iscor boosted attributable income by 75 million rand or 10 percent to 853 million rand in the year to June 30, largely because of a number of exceptional items. - - - - THE STAR - National Police Commissioner George Fivaz and Business Against Crime (BAC) have unveiled an ambitious plan to rectify serious managerial and logistical shortcomings in 100 of the country's most needy police stations. - One in three teenage girls at the four high schools in Johannesburg's suburbs of Coronationville and Westbury have been or will be raped by schoolmates or gangs, according to headmasters, police and family counsellors working in the areas. - Former Vlakplaas commander Colonel Eugene de Kock was found guilty on Monday on five murder charges for the killings of alleged bank robbers in an ambush. -- Johannesburg newsroom +27 11 482 1003 3752 !GCAT These are the leading stories in Zimbabwe's state-owned Herald newspaper on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. HERALD - The ministry of home affairs has so far formally dismissed 80 civil servants who took part in a nation-wide strike for salary hikes, with many defying calls by the government to report back to work last Friday. - Four Zimbabwean organisations on Monday contributed a total of Z$1.2 million towards the hosting of a world solar summit in September by the southern African country. - The Eastern and Southern African Trade and Development bank has extended a low-interest Z$1.8 billion line of pre-shipment credit to Zimbabwe which will largely benefit the agricultural sector. - A number of black Zimbabwean businessmen have broken into the highly competitive seed industry and have shown a potential to become some of the country's major players in the field in coming years. -- Harare Newsroom: +263-4 72 52 28/9 3753 !GCAT HOSPODARSKE NOVINY - Eastward expansion of the EU will not take place before the year 2000, though this could also be delayed if the Union is not able to reform the Maastricht Treaty on continental integration. - Omnipol a.s. intends to save Aero Vodochody a.s. though it insists that no company will invest in a firm with a three-billion crown debt. - The state paid 500 million crowns to 41 pension funds in the second quarter of 1996. Altogether, the state has paid out 870 million crowns to pension funds since the beginning of this year. - The State Market Regulation Fund acknowledged the agreement reached by Agriculture Minister Josef Lux and Czech farmers on Friday. According to the agreement, the state will purchase all wheat from farmers for 3,500 crowns a tonne. - Kovosvit Sezimovo Usti a.s., the leading Czech producer of machine tools, wants to penetrate the prestigous American market. PRAVO - A controlling block of shares in one of the two largest pension funds in the country, Podnikatelsky Penzijni Fond, may be purchased by the PPF financial group. Sources from the group, however, deny this. - The Slany-based firm Palaba has decided to sell its 30 percent stake in Ralston-Bateria Slany to Ralston, giving the American company a controlling 70-percent stake in the company. MLADA FRONTA DNES - The Czech trade deficit grew by a monthly record of 16.4 billion crowns in July, pushing the total deficit up past 85 billion crowns for the first seven months of the year. - The Ministry of Agriculture intends to extend the validity of high potato import duties at the request of local potato producers. This is in spite of the fact that local potatoes will not increase in price. - Economic trade between the Czech Republic and Austria is in a slump in spite of the fact that no trade restrictions exist between the two neighbours. -- Prague Newsroom, 42-2-2423-0003 3754 !GCAT !GCRIM Eastern countries like Romania are indifferent to the sexual exploitation of children that horrifies the West, despite becoming a haven for sex offenders, protection workers said on Tuesday. State institutions and the general public refuse to believe there is a growing problem with paedophilia, juvenile prostitution and child abuse in Romania, said George Roman, programme manager for charity "Save the Children." As experts gather in Stockholm for a global meeting to tackle the sexual exploitation of minors, scant public attention is being paid to the subject in places like Romania, where controls on abuse are lax. "We could face some overwhelming social problems unless Romania issues new laws and reforms old statutes to include new phenomena like paedophilia," said Roman. "We've already witnessed the start of sexual tourism here." "The support for our work is minimal," said Roman. "Most people have little sympathy for children living on the streets, the main victims, and say they should be locked up or put to work," he said. The December 1989 revolt against communism and execution of late Stalinist dictator Nicolae Ceausescu ended strict social controls and led to an explosion in pornography, child prostitution and trafficing in minors. Bucharest has now become an attractive destination for well-organised paedophiles, with the estimated 2,000 children living in squalor on the city's streets easy prey for visitors. "In these countries it is easy for a westerner to make himself pleasant and attract children for prostitution gangs under the guise of charity," said Ecaterina Laudatu, secretary of the National Child Protection Council (CNPC). Children were invited to Britain and saved only by the police there who recognised the hosts as known paedophiles, Laudatu told the daily Libertatea. After Romania tightened laws on adoption criminals set up commercial operations inside the country. State childcare agencies have little funding and no programmes to fight them. Save the Children estimated some 50 paedophiles travel regularly to Romania, posing as tourists or businessmen, and rent apartments where they bribe or force children into appearing in photographs or films. One particular Frenchman comes every two months with friends to "make pornographic films and shoot pictures," said Roman. Bribing policemen guarantees impunity, he added. "The children don't resent these sexual experiences because they earn good and quick money," Roman said. "They don't realise the damage it is doing to them." One formerly sexually abused boy, now 16, has graduated to being a leading supplier of children for French, British and German paedophiles. His case is symptomatic of how sexual abuse will quickly spread, said Roman. "In four, five years they might develop a whole network, which will be almost impossible to fight against as the country has no controls," Roman said. 3755 !GCAT !GPOL The two parties in the ruling leftist coalition are unlikely to agree on a planned cabinet reshuffle at their meeting on Wednesday, a senior official of the larger Democratic Left Alliance (SLD) said. "More meetings will be needed to reach a compromise," Leszek Miller, the cabinet Chief-of-staff and a leader of the ex-communist SLD party, said on Tuesday. He said that the SLD and the smaller Polish Peasant Party (PSL) would discuss at the meeting whether the reshuffle, linked with a coming reform of ministries, should involve dismissing the current government and appointing a new one. "Negotiations on appointments in ministries will probably come later," Miller told Reuters. The PSL wants the entire current cabinet dismissed and a new one sworn in during implementation of the reform and analysts say the party hopes in this way to increase its role in the government. The SLD says the minister should be replaced gradually by its Prime Minister Wlodzimierz Cimoszewicz. -- Warsaw Newsroom +48 22 653 9700 3756 !C12 !CCAT !GCAT !GCRIM Bulgaria will seek extradition of a Bulgarian businessman arrested in France last week on suspicion of obtaining $10 million by fraud, a prosecutor said on Tuesday. "We are now preparing the documents through which we will demand Nedialkov's extradition from the French court," head of the main prosecutor's office supervision department Angel Ganev told Reuters. "The procedure will take a while, though," he added. French police detained Ivo Nedialkov, aged 30 and former head of the East West International Holding Group (EWIHG) which collapsed in 1994, in the Riviera resort of Cannes on August 20. The target of an international arrest warrant, Nedialkov swindled thousands of Bulgarians of their savings in 1993-94 through EWIHG -- a pyramid investment scheme which involves using income from new investors to buy back shares from old investors at ever-rising prices. Investigation authorities have said that he has misappropriated around 360 million levs or $10 million under the average exchange rate of that period. Nedialkov disappeared from Bulgaria in December 1994 after the collapse of his firm and arrived in Cannes in early 1996, where he rented a luxury villa. He had previously lived in Britain and Australia. Bulgarian media said he was arrested for owing several months of rent. If extradited Nedialkov faces five to 30 years in prison, depending on how his crime will be qualified, prosecutors said. Pyramid investment schemes have proved popular in several other ex-communist countries, including Russia and Romania. Some 30,000 Bulgarians took a bitter lession in investment last year when $25 million sank into the several get-rich-quick schemes, after their owners fled with the money. Some of the founders of the pyramids are now under arrest while others are being investigated by Bulgarian authorities with the cooperation of Interpol. Another Bulgarian-born businessman Michael Kapustin accused of misappropriation of more than $10 million was due to be extradited from Germany this week, said Ganev. The extradition however was postponed due to Kapustin's hunger strike and ensuing bad health. -- Elisaveta Konstantinova, Sofia Newsroom, 359-2-84561 3757 !E51 !E512 !ECAT !GCAT !GCRIM !GDIP !GVIO The United Nations should consider economic sanctions to force factions in the former Yugoslavia to hand over indicted war crime suspects, U.N. chief prosecutor Richard Goldstone said on Tuesday. "The most important single problem (facing the U.N. Yugoslavia war crimes tribunal) is to press and press for people to be arrested and for the Security Council, if necessary, to impose sanctions in order to achieve that," Goldstone told Reuters. "That clearly is the only route if the Security Council does not want to be seen to have its own credibility in question ... It's the obvious remedy," he said. Goldstone, who will step down next month from the U.N. war tribunal for the former Yugoslavia to head the constitutional court in his native South Africa, was in Canada to attend an international law conference. The tribunal based in the Hague has indicted 75 suspects -- 54 Serbs, 18 Croats and three Muslims. But most, including deposed Bosnian Serb leader Radovan Karadzic and military commander Gen. Ratko Mladic, remain at large. Goldstone criticized the NATO-led peace force in Bosnia for refusing to engage in manhunts for war-crimes suspects, saying an aggressive effort to capture them would have created a freer atmosphere for Bosnian elections scheduled next month. He said the election result would be "fundamentally important in the determination of what further action if any should be taken with regard to arrests." The Dayton peace agreement, signed last December to end the 43-month-old war in Bosnia, banned indicted war criminals from holding official positions. "If Dayton works and indicted war criminals are effectively kept out of office ... the prospects of their being arrested and handed over by their own people is immeasurably increased," Goldstone said. He also acknowledged that any consideration of sanctions by the U.N. Security Council would hinge on political factors. Diplomats are skeptical that sanctions would be reimposed soon against Yugoslavia and the Bosnian Serbs, although some council members have raised the idea. It would require Russia's consent and many doubt Moscow would agree. The Yugoslavia tribunal was created by the Security Council in 1993, the first body set up to prosecute war crimes since the Nuremburg and Tokyo trials after the Second World War. Goldstone, who is also chief prosecutor on the U.N. tribunal for Rwanda, urged the international community to create a permanent court to deal with war crimes. 3758 !E21 !E211 !ECAT !GCAT !GPOL Canada's Liberal Finance Minister Paul Martin refused on Tuesday to bite on the bait dangled by the Conservative Party of offering a tax cut. The Conservatives, reduced in 1993 from a majority to only two seats in the 295-seat House of Commons, said on the weekend that it would push for a 10- to 20-percent income tax cut in its first term if elected. Martin said the Conservatives, prior to Prime Minister Jean Chretien taking office, had raised taxes more than any other Canadian government. He said they had to state clearly what social programs would be cut to pay for tax reductions. He added that policies implemented by the Chretien government so far had already put money back in the economy. "Take a look at what we've done. First of all, there's already been a substantial cut in unemployment insurance premiums, there have been major tariff cuts, which certainly puts money in Canadians' pockets," Martin told reporters after a cabinet meeting. "And there is no doubt when you take a look at the reduction in the cost of a mortgage, for instance, as the result of interest rate cuts that have flowed from our deficit program, that has put more money in Canadians' hands than any tax cut that can be promised by any government." Martin has guided the federal deficit down, targeting three percent of gross domestic product in the current fiscal year and two percent in 1997-98. Analysts have begun to wonder whether he might be tempted to pledge tax cuts ahead of elections expected in 1997, though any deviation from the sustained program of deficit cuts would risk ruining a track record the markets have so far applauded. -- Randall Palmer, Reuters Ottawa Bureau (613) 235-6745 3759 !CCAT !GCAT !GDIS At least five people were injured when an Amtrak passenger train slammed into an empty logging truck and derailed early on Tuesday, officials said. The Vermonter, which runs between St. Albans, Vermont, near the Canadian border and Washington, D.C., collided with the truck at 7:51 a.m. EDT near the rural town of Roxbury some 15 miles southeast of the state capital Montpelier, Amtrak spokeswoman Maureen Garrity said. Vermont Central Hospital spokesman Dan Pudvah said five people, including the truck driver, were brought to the hospital for treatment. "The truck driver has been treated and released," Pudvah said. "Another passenger, a woman, who had been brought in earlier this morning, has also been released and we expect that the three others will be released later in the day." The train's engine and its six cars derailed but were still standing, state police said. The exact number of passangers was not known. "We had 70 reservations for the train, but that doesn't mean there were 70 passengers aboard," Garrity said. Uninjured passengers were to be taken by bus to Springfield, Massachusetts, where they will be put aboard another train to continue their journey to New York City and Washington, Garrity said. She said the train was traveling at 54 mph when it crashed into the truck, which was crossing the tracks onto a dirt road in the rural area bordering the Northfield Mountains. 3760 !GCAT !GDIS Firefighters across the Western United States battled on Tuesday to suppress dozens of new lightning-sparked wildfires threatening natural gas pipelines and some homes. Thousands of lightning strikes started new fires across the west, though most of the new blazes were small and were expected to be quickly contained. In hard-hit Modoc County, along the California - Oregon border, crews were battling more than 36 lightning-sparked blazes. The largest of them, the Ambrose complex of six fires on 15,000 acres, was threatening two underground natural gas pipelines, four major power lines and the small community of Tionesta, state fire officials said. The National Interagency Fire Center based in Boise, Idaho, reported Tuesday 39 major wildfires on more than 320,600 acres, a figure that does not incorporate many of the smaller lightning-sparked fires. By contrast, the fire center on Monday said that 20 large fires were burning on about 238,000 acres (96,320 hectares). More than 18,200 firefighters were battling the blazes with support from 156 helicopters and 30 airtankers Tuesday. "We're very stretched," said Rose Davis, a fire information officer with the fire center. Davis said additional military personnel could be activated in the coming days to help battle all of the fires. The fire center was still on watch for dry thunderstorms in southeastern Oregon and the central mountains of Idaho. In central Oregon, firefighters gained ground on several major blazes while crews fanned out to subdue several smaller, lighting-sparked fires. Hundreds of lightning strikes Monday in central Oregon sparked at least 50 fires, most of them very small and easily contained, authorities said. Reinforcements helped firefighters to gain the upper hand on the Skeleton complex fires near Bend, Oregon. The complex fires have consumed 22,056 acres but were expected to be fully contained later Tuesday, said Carol Connolly of the Central Oregon Interagency Dispatch Center. The Skeleton fire spread to one subdivision near Bend on Saturday, destroying 19 homes, 13 other structures and three travel trailers. But residents of the subdivision were allowed to return to their homes early Tuesday. In Idaho, firefighters said they hoped cooler temperatures would help them battle a major fire just outside Boise. The fire, having consumed 12,000 acres of grass and brush, was now burning timber. It destroyed one home near Boise on Monday. More than 600 firefighters were being brought in Tuesday to help fortify the fire lines as three subdivisions outside Boise were put on alert for possible evacuation should winds kick up and the fire move in their direction, officials said. North of Los Angeles, firefighters were battling a fire that has charred more than 11,000 acres near Castaic. Several helicopter and airtanker crews were helping firefighters battle the blaze, which forced the closure Monday of a stretch of Interstate 5, stacking traffic on the vital north-south artery for miles. Crews continued to battle a major fire burning within Yosemite National Park and the Stanislaus National Forest. The fire has scorched 40,000 acres and was 50 percent contained on Tuesday. So far $12.6 million has been spent fighting the blaze. "Things are looking better," said Carol Coats, fire information officer with U.S. Forest Service. 3761 !C12 !CCAT !GCAT !GCRIM !GDIS The man who was driving a water ski boat that crashed Aug. 17 into a crowded grandstand at Sea World of Ohio was charged Tuesday with driving the boat too fast and another misdemeanor, a local court said. The charges came despite state investigators' findings that mechanical failure caused the accident. The 18-foot, jet-propelled ski boat skimmed off the water and into the stands at a crowded weekend show, injuring 24 spectators. One man remained hospitalized Tuesday, in stable condition with a head injury, a Cleveland hospital said. A contractor operated the ski show until the accident, when Anheuser-Busch Cos. Inc. suspended all such shows at its four Sea World parks pending a safety review, Anheuser-Busch spokesman Steve LeResche said. A municipal court said the driver, Andy Schleis, 25, was charged with excessive speed and failure to take action to avoid a collision. Each is a misdemeanor carrying a possible 30-day jail sentence and a $250 fine, Chardon, Ohio, municipal prosecutor James Gillette said. The contractor that operated the ski show, World Entertainment Services of Winter Park, Fla., was charged with failure to have flotation devices, distress signals and an anchor aboard the boat, the Chardon Municipal Court said. 3762 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Caterpillar Inc. said Tuesday it is prepared to unilaterally impose employment terms, effective Oct. 1, on employees represented by the United Auto Workers after declaring an impasse in talks with the union. The impasse revolves around the firings of some union workers before and during the 17-month strike against the Peoria, Ill.-based heavy equipment maker that ended in December without a new contract. Caterpillar is willing to have firings after the strike sent to arbitration, but not those before and during the walkout. The terms Caterpillar said it will impose at its eight UAW-represented plants in the United States include a pledge not to close any faciltities except the company's York, Pa., plant through September 2001, and job guarantees through that time period. Caterpillar has 31 manufacturing plants in the United States. "We are taking this step to provide our employees with an added sense of security about their future, while giving Caterpillar the labor costs and the flexibility we need to keep jobs in the U.S. and keep our U.S.-made products competitive around the world," Caterpillar Vice President Wayne Zimmerman said in a statement. Other terms include a 19 percent increase in Caterpillar's supplement of pensions for retirees until they become eligible for Social Security, an average increase of 7-1/2 percent in pensions and a doubling of potential incentive pay, Caterpillar said. Caterpillar's UAW workers have been working without a contract since 1991. A 17-month strike against the equipment maker ended in December without a resolution of contract issues. The UAW said Tuesday it does not agree that it has reached a lawful impasse with the company that makes it necessary for the terms to be put into effect. "This tactic is yet another attempt to subvert the collective bargaining process," UAW Vice President Richard Shoemaker said in a statement. The union said it will pursue the appropriate legal remedies if the company takes action to implement employment conditions without the existance of an impasse. One analyst said the impasse declaration by Caterpillar appears to be genuine, not just a bargaining ploy. "I don't think this is really a bargaining move," said Barry Bannister, analyst at S.G. Warburg. "It's just an obvious impasse." He also said he did not expect the move to affect the stock, noting that strikers returned to Caterpillar several months ago without an effect on the company's profit margins. 3763 !C12 !CCAT !GCAT !GCRIM An administrative law judge in California heard testimony on Tuesday on a proposal to suspend deliveries of Chrysler Corp vehicles for two months in the state, a California Department of Motor Vehicles spokesman said. The judge heard testimony in Sacramento on the potential economic impact of the proposed suspension to dealers, consumers and local governments. Three dealers were to testify in hearings expected to last through Wednesday, state Department of Motor Vehicles spokesman William Gengler said. Earlier this year, the administrative law judge found that Chrysler violated the state Lemon Law 116 times by re-selling repaired cars and trucks without proper documentation. Violations included failing to notify used car buyers of the status of the vehicles sold and failing to provide warranties. The vehicles in question were sold in 1992. In late May, the state Department of Motor Vehicles asked the judge to review the impact of the proposed 60-day suspension. Under the proposal, Chrysler would be prohibited from delivering vehicles to dealers for 60 days and the company would be on probation for three years. In response, Chrysler vowed to continue selling vehicles in California, saying it would either settle alleged violations of the Lemon Law or prevail in the appeal process. California authorities said they have been investigating the Chrysler matter for more than two years and stand by the allegations. "Action should definitely be taken against Chrysler because of the extent of the violations in California," Gengler said. "However, we sent the proposed decision back to the judge because we were concerned about the economic impacts it would have on innocent third parties." During the review period, no action was to be taken against Chrysler, Gengler said. When the hearings are completed, the judge is expected to reaffirm or modify his earlier decision. Afterwards, the Department of Motor Vehicles could accept, modify or reject the proposal. If accepted, Chrysler would be able to take the case to the New Motor Vehicle Board or appeal to a higher state court, Gengler said. 3764 !C11 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Earthgrains Co said Tuesday it will transfer bread production to its Atlanta facility from its Augusta, Ga. bakery, eliminating about 60 jobs. Earthgrains has about 12,000 U.S. and 3,000 European employees. The company said it is still determining the amount of a restructuring charge it will take, but added it is not likely to be material. It said about 115 sales employees will continue to serve Earthgrains customers and consumers in the Augusta market, but production there will cease. Earthgrains said the shift, scheduled for October 28, is designed to reduce production overcapacity and improve systemwide operating efficiency. The Augusta plant bakes white and wheat breads under the Colonial, Grant's Farm brands and store-brand labels. -- Chicago newsdesk 312 408-8787 3765 !GCAT !GHEA Cleaning out clogged coronary arteries with plaque-cutting devices and balloon angioplasty works better than balloon angioplasty alone, according to a U.S. study released Tuesday by Guidant Corp. "This confirms that DCA (directional coronary atherectomy) is a strong clinical option for treating difficult clinical cases," said Ginger Howard, president of Indianapolis-based Guidant's vascular intervention group. The "balloon versus optimal atherectomy" trial showed that plaque-cutting and angioplasty combined could open clogged arteries wider than angioplasty alone, Guidant said. In addition, arteries opened using both methods became reclogged 20 percent less often than did arteries treated with angioplasty alone, the study found. The plaque-cutting, or atherectomy, devices used in the BOAT study were made by Guidant's vascular intervention group. Shares in Guidant closed off 1/2 at 49-7/8 on Tuesday. "Based upon the BOAT data, we know that when the appropriate amount of plaque is removed from the artery, the restenosis rate with optimal DCA (directional coronary atherectomy) is comparable to previously reported stent results," Howard said. Treatment of coronary artery disease was revolutionized in recent years by balloon angioplasty, a procedure in which a tiny balloon is inflated inside an artery to crack and remove plaque that builds up inside diseased blood vessels. Angioplasty is now often used instead of open-heart surgery, but arteries treated with it frequently become reclogged -- a problem called restenosis. Cardiologists have attacked restenosis with another device called the stent. A stent is a small tube that can be inserted into an artery treated by angioplasty and left there to hold the blood vessel open. The success of stents has overshadowed atherectomy, a plaque-cutting technology that emerged about the same time as angioplasty, analysts said. The BOAT study used Guidant's atherectomy device to cut away more plaque then usual before also doing a balloon angioplasty procedure -- a combined procedure that Guidant called "optimal DCA." Results were superior compared to angioplasty alone in 1,000 patients treated in the Guidant-sponsored study, the company said. In related news, Guidant Corp said it signed a joint development agreement with Hewlett-Packard Co related to Guidant's guided directional coronary atherectomy catheter, which is used to clear blocked arteries in the heart. "As part of the agreement, HP will modify its existing intravascular ultrasound system console, as well as develop a GDCA patient interface unit and a console upgrade kit for use with Guidant's GDCA catheter and related products. Guidant will sell the HP diagnostic equipment with its GDCA catheter," the company said. Terms of the arrangement were not disclosed. --Chicago Newsdesk 312-408-8787 3766 !C12 !CCAT !GCAT !GCRIM The Austin Co agreed to pay a $4 million settlement to the U.S. government to resolve allegations that the engineering and construction firm overcharged for its pension costs on more than 40 government contracts between 1980 and 1990, the Justice Department said. Austin Co's sales and marketing vice president Jeffrey Raday said the company admitted no wrongdoing. "The settlement was the result of the government's interpretation of complex federal accounting regulations regarding pension costs," he said. "We believe that these regulations are subject to various interpretations." Austin, a privately held company with 1995 sales of about $460 million, is based in Cleveland Heights and has offices elsewhere in the U.S. and overseas, Raday said. He said the government is a major customer and the settlement does not affect current contracts nor eligibility for future contracts. Design projects in the case included post office and military facilities, the government said. In a statement Monday, the Justice Department said the "whistleblower" civil case involved contracts for hundreds of millions of dollars and said the whistleblowers will receive a portion of the settlement. --Cleveland Newsdesk 216-579-0077 3767 !C13 !C18 !C181 !C182 !C34 !CCAT !G15 !G157 !GCAT Kimberly-Clark Corp Tuesday said it would sell a tissue mill in Northumberland, England, as well as other consumer tissue businesses in Britain and Ireland, to a unit of Svenska Cellulosa Aktiebolaget SCA of Sweden. The European Commission required the sale of the mill, located in Prudhoe, as a condition for its approval in January of the merger of the European operations of Kimberly-Clark and Scott Paper Co. Financial terms of the transactions were not disclosed. Kimberly-Clark said neither the sale of the Prudhoe mill nor the license of the Kleenex brand will have any effect on its "away from home" business for institutional markets. The company expects the transactions to close in September, pending consultation with affected employee works councils and notification to French regulatory authorities. It said the purchase of Peaudouce will make it the second-largest diaper company in Europe and increase its share of that country's diaper market to about 30 percent. 3768 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Caterpillar Inc said Tuesday it has informed the United Auto Workers union that it believes the two sides have reached an impasse in negotiations due to the union's position on employee discharges. Caterpillar said it is prepared to implement unilaterally several employment terms October 1 at eight U.S. facilities. The terms -- affecting all eight U.S. plants represented by the UAW --include a pledge not to close any faciltities except the company's York, Pennsylvania, plant through Septepmber 2001, Caterpillar said. "We are taking this step to provide our employees with an added sense of security about their future, while giving Caterpillar the labor costs and the flexibility we need to keep jobs in the U.S. and keep our U.S.-made products competitive around the world," Caterpillar vice president Wayne Zimmerman said in a statement. The terms include job security through September 2001, a 19 percent increase in Caterpillar's supplement of pensions for retirees until they become eligible for Social Security, an average increase of 7-1/2 percent in pensions and a doubling of potential incentive pay, Caterpillar said. Caterpillar's UAW workers have been working without a contract since 1991. A 17-month strike against the equipment maker ended in December without a resolution of contract issues. A spokesman for the United Auto Workers in Peoria could not immediately be reached for comment. --Reuters Chicago newsdesk, 312-408-8787 3769 !C12 !C13 !CCAT !GCAT !GCRIM Foxboro Co, a unit of Siebe Plc's Siebe Control Systems Division, on Tuesday said it believes a patent infringement suit brought against the company by Honeywell Inc is without merit. It said the suit relates to certain Foxboro products that have been on sale and in production from five to 10 years. Earlier Tuesday, Honey said it filed its suit in U.S. District Court for the District of Arizona against Foxboro Co, claiming that Foxboro has sold certain instruments that incorporate microprocessing functions covered by Honeywell's patents. A Foxboro spokesman noted that in April Foxboro itself sued Minneapolis-based Honeywell for patent infringement. -- Chicago newsdesk 312 408-8787 3770 !C12 !C13 !CCAT !GCAT !GCRIM A U.S. appeals court on Tuesday dealt the government a blow worth millions of dollars, ruling that natural gas producers owed no royalties on money that pipelines paid producers to get out of long-term gas purchase contracts. The government had sought to collect royalties on gas contract settlements, so-called take-or-pay settlements, stemming from the 1980s when federal regulations forced pipeline companies out of the gas sales business. Reversing a lower court decision, two out of three judges on the U.S. Court of Appeals for the District of Columbia backed producers who argued that they should not have to pay royalties on cash settlements for gas they were no longer pumping or were selling at lower prices under new contracts. The lawsuit stemmed from a challenge by independent producer Samedan Oil Corp against the U.S. Interior Department (DOI), which sought to collect $20,000 on a contract settlement of $100,000 in 1993. "We ... hold that DOI is precluded from collecting royalties on the $100,000 settlement payment," the court said. The court said the Interior Department's attempt to collect royalties on the settlements was "arbitrary and capricious" in light of an earlier court decision on take-or-pay payments -- payments pipelines made to producers when they opted not to take gas under their take-or-pay contracts . In an earlier court ruling, the Interior Department was barred from collecting royalties on take-or-pay contract payments. The Court of Appeals on Tuesday reflected the earlier court decision, which it said was based on the "necessary link between royalties and actual production of gas." The Interior Department's Minerals Management Service, which is in charge of collecting royalties on oil and gas produced on federal lands, had no immediate comment on the ruling. Natural gas producers, led by the Independent Petroleum Association of America which filed the lawsuit, were ecstatic. "It has vast implications for the past, present and future," said Natural Gas Supply Association spokeswoman Charlotte LeGates said. She said the ruling could help producers in their ongoing talks with MMS about what producers must pay royalties on. "We say it's owed on gas when it comes out of the ground and sold into markets," said LeGates. But in a recent proposal by MMS, royalties would be due on the hub price of gas after producers have paid for transportation and processing. It was not immediately clear how much money the government would lose in royalties and penalties in light of the ruling. The government tried to make companies start filing paperwork to estimate how much was owed, when the IPAA lost the case in a lower court. But the IPAA then filed a lawsuit to stop the process until the appeals court made its decision. 3771 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Unit Instruments Inc said Tuesday it would cut about 60 full-time and five temporary workers from its staff because of what it called "a steep downturn for semiconductor fabrication equipment." Unit Instruments already cut 21 full-time and 23 temporary jobs in the current quarter, ending August 31. In total, the job cuts make up about 22 percent of its workforce. At May 31, the end of fiscal 1996, the company employed 500 people. The company said job cuts and other possible restructuring moves could result in charges against earnings. A spokesman said it was too soon to know how much the charges might be. In addition, the company said it has frozen pay for its senior management and cut its capital-spending plans. 3772 !C12 !CCAT !GCAT !GCRIM U.S. Court of Appeals has reversed a Federal District Court decision to deny TLC Beatrice International Holdings Inc 's challenge to the validity of a class action involving the 1992 Michael Milken "global settlement", the company said Tuesday. TLC Beatrice said the court for the second circuit had sent the company's motions back to the district court in Manhattan on Monday for further hearings, saying its attack on the class action should not have been dismissed. The company said it had challenged the validity of the class action, known as Presidential Life Insurance v. Milken, which ended all litigation against financier Michael Milken and other parties connected to Drexel Burnham Lambert. The action was a collusive suit in violation of the class members' due process rights, among other things, it said. TLC Beatrice distributes dry groceries, beverages and household products to supermarkets in Paris, France. It also makes and markets ice cream in Spain and the Canary Islands as well as makes potato chips in Ireland. -- New York Newsdesk 212 859-1610 3773 !C12 !CCAT !GCAT !GCRIM Hewlett-Packard Co said it moved to dismiss a complaint filed against it by Computer Aid Inc in June. At the same time it filed its own 13-count complaint against Computer Aid in the U.S. District Court in San Francisco, denying any wrongdoing and charging Computer Aid with libel. It said Computer Aid made false and defamatory statements about it. A Hewlett-Packard spokesman said the Computer Aid lawsuit concernted a dispute over proprietary software code. 3774 !C12 !CCAT !GCAT !GCRIM Two purchasers of Proxima Corp common stock said they filed a class action law suit againt the company charging it and certain officers and directors allegedly made false statements and engaged in insider trading. The shareholders, Richard Halsey and Martin Weber, allege the company made false statments mainly about the strong demand for and success of its newest desktop projection products. The shareholders said statements that that group of products would lead to strong earnings growth in 1997 caused Proxima's stock to soar, at which point certain Proxima "insiders" sold their holdings, before the stock collapsed. Proxima's stock fell from a high of 28-1/2 to as low as 9-1/8 and is currently selling in the $13 range. Proxima was not immediately available for comment. 3775 !C13 !CCAT !GCAT !GDIS !GVIO The investigation of TWA Flight 800's crash is racking up monumental costs, which has forced the cash-strapped U.S. National Transportation Safety Board to seek help from the corporations involved. The investigation off the coast of Long Island, N.Y. is costing well over $100,000 a day - about $3 million so far - according to a spokesman at the NTSB. The NTSB sent letters last week to Trans World Airlines Inc, Boeing Co, makers of the downed 747 jetliner, and United Technologies Corp's Pratt & Whitney Canada Inc unit, which made the jet's engines. TWA was asked for $5 million, Boeing was asked for $2 million, and Pratt & Whitney was asked for $1 million, the NTSB spokesman said. All three companies confirmed through spokesmen receipt of the letters and the amounts requested, and all three said the request was being considered. "It's not unusual, in major investigations when costs go well above what's normal, for the Board to request payments from parties involved in the investigation or others involved in the investigation," the NTSB spokesman said. "We did that because there were some extraordinary costs that the Board couldn't absorb." The majority of the expense is for the hiring of private salvage boats and other contractors. The tab also includes about $5,000 a day to rent the hangar where the wreckage is being reassembled, and thousands in ancillary expenses, such as hotel, transportation, food and phone bills for an army of investigators, the agency said. The safety board's annual budget is about $37.5 million, but extraordinary costs for investigations come from a special fund of $1 million authorized by Congress. When that $1 million is exhausted, the NTSB must go back before Congress seeking replenishment, the spokesman said. The fund has "several hundred thousand dollars" remaining, but, after the investigations of ValuJet's crash in the Florida Everglades in May and Germany's Birgenair crash in the Dominican Republic in February, the fund will need a cash infusion soon, he said. The Flight 800 investigation is exceptionally costly because it is taking place 10 miles out in the Atlantic Ocean and 120 feet deep. By contrast, the investigation of the USAir's September 1994 crash outside of Pittsburgh, Pa. - although it is still ongoing two years later - has amounted to only about $1 million because it was all on dry land. The Birgenair accident was a watery crash, but most of the investigation was satisfied by information on the flight data recorder and cockpit voice recorder. But the cost still amounted to about $800,000, the NTSB spokesman said. TWA spokesman John McDonald said the carrier has already spent in excess of $1 million on accomodations at John F. Kennedy International Airport for the families of the crash victims. Suffolk County's budget director, Kenneth Weiss, said the county's cost so far adds up to $4.4 million. Of that amount, about $1.6 million came from overtime wages and $1.3 million in regular salaries. DNA testing equipment was purchased by the county at a cost of $181,000 and a helicopter landing pad was enlarged at a cost of $60,000, Weiss said. The county's 1996 budget totals $1.6 billion, he said. "My understanding is that the local government cost will be reimbursed by the federal or state government. There may be a problem with the federal cost, but that's not our concern," Weiss said. All 230 passengers died when the Boeing 747 exploded and plunged into the ocean on July 17. Although the cause of the crash has not been officially determined, divers have recently discovered wreckage with traces of two types of chemicals used in explosives. 3776 !C12 !C13 !CCAT !GCAT !GCRIM Honeywell Inc said Tuesday it filed a patent infringement suit in U.S. District Court for the District of Arizona against Foxboro Co, a unit of Siebe Plc's Siebe Control Systems Division. It said the suit alleges that Foxboro infringes two U.S. patents held by Honeywell that pertain to operation of "intelligent" field measurement devices. Honeywell contends that Foxboro has been selling field instruments, such as pressure transmitters, that incorporate certain microprocessing functions covered by Honeywell's patents. Foxboro spokesmen were not immediately available for comment. -- Chicago newsdesk 312 408-8787 3777 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Negotiations between Aluminum Co of America and the United Autoworkers union were continuing on Tuesday in an attempt to reach a new contract for workers at a forging plant in Cleveland, where the current pact expires on Tuesday at midnight EST, an Alcoa spokeswoman said. She declined to comment on any possibility of a strike or the nature of the talks. "All we've been told, is that they're still talking," she said. The current contract covers some 1,000 autoworkers at the plant, which makes forged aluminum parts for several industries, including the auto industry. Union officials were not available for comment. -- Pittsburgh newsroom -- 412-471-7088 3778 !C11 !C18 !C181 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The Teamsters Union expressed optimism Tuesday over Consolidated Freightways Inc.'s spinoff of its unionized long-haul, less-than-truckload units, saying the move could create new opportunities for its members. The Palo Alto, Calif.-transportation company said Monday it plans to spin off its Consolidated Freightways Corp. to stockholders in a tax-free transaction by the end of the year. The unit includes CF MotorFreight, where the International Brotherhood of Teamsters represents more than 17,000 workers. "The spinoff prevents the drain of resources from CF's unionized operations to subsidize the expansion of nonunion subsidiaries," Teamsters General President Ron Carey said in a statement. "It could take the shackles off our members and let their company grow ...." The union has often complained that some of its trucking employers engage in "double-breasting," a practice in which employers set up non-union subsidiaries to compete with their unionized operations. But Carey said the success of the new operation also will depend on its management, which has assured the union that the spinoff will not result in layoffs. "The key to CFC's success will be whether management works with the union to create security and opportunity for our members," Carey said. "They certinly have more incentive to do that now than they did before the spinoff." 3779 !GCAT !GDIS !GWEA Hurricane Edouard, packing winds of 130 miles per hour (208 kph) as it moves toward the U.S. East Coast, will not be a threat to business interests at least until the weekend, if at all, a forecaster said Tuesday. "The bottom line is that Edouard will have virtually no impact on energy or agriculture related interests from now through Saturday," Jon Davis, a forecaster at Smith Barney in Chicago, said in a daily meterological report. Davis said, however, there was a chance the storm, now about 1,200 miles east of Miami, could become a threat to certain business interest on the East Coast. "Items that have to be monitored if the storm does make landfall will be possible impacts to the Southeast cotton agricultural belt and energy operations in and around the New York Harbor area," Davis said. He said the storm was now moving in a west-northwest direction at 15 miles per hour, but was likely to begin moving in an increasingly northwesterly direction. "Because it will be moving in a more northward direction over time, the most likely spots for landfall will be those that tend to jut out in the Atlantic -- the coastal areas of North Carolina or Cape Cod (Massachusetts)," Davis said. He added that while it was still too early to say whether the storm will make landfall, his sense was that it would not touch land at all, and will instead head out to sea. "For what it is worth, my gut feeling is that Hurricane Edouard will veer north and then northeast and not hit the East Coast of the U.S.," he said. -- Oliver Ludwig, New York Energy Desk +1 212 859 1620 3780 !C12 !C13 !CCAT !GCAT !GCRIM Digital Biometrics Inc said it intends to appeal a court ruling against it in a patent infringement case involving Identix Inc. On August 26, Identix said a U.S. federal court in California ruled that its TouchPrint-600 fingerprint-imaging machine does not infringe a Digital Biometric patent. Digital Biometrics said it plans to appeal the ruling to the U.S. Court of Appeals for the Federal Circuit. Digital Biometrics said the ruling does not affect its ability to sell its products, including the recently announced S Series TENPRINTER system. Reuters Chicago Newsdesk - 312-408-8787 3781 !C13 !C24 !C33 !CCAT !GCAT !GENV Green Oasis Environmental Inc said it won approval from Exxon Corp to build a waste oil processing equipment and manufacturing facility. Permission from Exxon, which had to have compliance certification from the U.S. Environmental Protection Agency, was required, the company said. 3782 !C12 !C15 !C151 !C16 !CCAT !GCAT !GCRIM Foxmeyer Corp, a unit of Foxmeyer Health Corp, listed assets of $1.2 billion and liabilities of $1.0 billion in its Chapter 11 bankruptcy filing, court papers said. The franchiser for drug stores filed Chapter 11 earlier today in the U.S. Bankruptcy Court in Delaware. The parent company did not file for bankruptcy. Also filing bankruptcy petitions were Healthcare Transportation System Inc, Foxmeyer Drug Co, Merchandise Coordinator Services Corp, Foxmeyer Software Inc and Healthmart Inc. Foxmeyer Corp has 23 distribution centres across the United States, court papers say. Almost all of the unsecured debt is in trade claims. According to court papers, parent corporation Foxmeyer Health Corp controls 20 percent or more of the voting securities of Foxmeyer Corp. 3783 !GCAT !GWEA Typhoon Orson is nearly stationary well southeast of Japan near 26.5n/151.4e. Top winds are near 105 mph and are expected to increase to near 125 mph during the next 24-36 hours as the storm begins to drift slowly to the north. Orson is not a threat to land but is a major threat to shipping. Powerful Hurricane Edouard has top winds near 130 mph with little change in strength expected during the next 24 hours. The storm is centered about 300 miles east northeast of the Leeward Islands, moving west northwest about 15 mph. This general motion is expected to continue during the next 24 hours. Edouard is a major threat to shipping. The current forecast track beyond 24 hours takes the storm to the northeast of the Caribbean islands, but this storm will have to be very closely watched. There are no further statements at this time. 3784 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The union representing American Airlines pilots have backed away from a demand for a five percent annual pay rise in ongoing contract negotiations. Jim Sovich, president of the Allied Pilots Association (APA), said in a recorded message to members that the pilots' union board on Monday dropped its insistence on a minimum five percent a year wage increase backdated to August 1994. He said the board directed its negotiators "to bargain in good faith to obtain a premium pay package, including full retroactive pay and job security guarantees that ensure industry leading compensation and job protection provisions." The labor contract negotiations, which began more than two years ago, moved to Washington earlier this month and both sides say they have reached a crucial phase. The two negotiating teams swapped a series of proposals in recent days, but there has been no breakthrough on the central issues of pay and work rules. Airline negotiators earlier this year dropped their demand for a two percent pay cut, but they still want a four-year wage freeze and the right to pay 20 percent of American's 9,400 pilots as much as 30 percent less and assign them to the small-aircraft unit. 3785 !C12 !C13 !CCAT !GCAT !GCRIM Faulding Inc said on Tuesday Purdue Frederick Co filed a patent infringement lawsuit against Faulding and its Purepac Pharamceutical unit. The suit was filed because of Purepac's manufacture of Kadian, a sustained release morphine product, Faulding said. Faulding said the claims in the lawsuit are without merit and will not impact upon the launch of Kadian in the United States. Kadian was approved for sale in the United States last month, Faulding said. Zeneca Group Plc, which will market Kadian, was named in the lawsuit with F.H. Faulding & Co, the majority shareholder of Faulding Inc, the company said. 3786 !C15 !C152 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Electronic Fab Technology Corp said on Tuesday that it expects to post a $2.1 million restructuring charge in the third quarter. The company recently completed a reduction of its overall work force by 142 positions, which resulted in a 23.2 percent decrease in employees and an approximately 30 percent reduction in annualized payroll costs, it said. Savings from the job cuts are estimated to be $4 million annually, Electronic Fab said. Electronic Fab said the restructuring aims to address a high-mix market niche and a slowing of anticipated orders in the fourth quarter of 1996. The company intends to increase its national presence through a strategic sales and marketing effort costing approximately $500,000, it said. Included in the restructuring charges are severance expenses and other labor costs related to work force reduction, write-down of impaired assets and write-down of inventory related to anticipated changes in the company's customer mix, the company said. 3787 !C24 !CCAT !GCAT !GENV Edison International's Southern California Edison said Tuesday it hopes to restart later today two high-voltage transmission lines which were shut Monday evening due to fire conditions. As a result of the outage, Edison has curtailed imports of power purchased from the Pacific Northwest. Gary Tarplee, manager of Edison's Control Center, said the two 500 kilovolt lines were taken off line about 1830 PST/2130 EDT Monday when smoke from a major fire north of Los Angeles contaminated their insulators. "The fires are still out of control, but we hope to restart the lines sometime later today," Tarplee said. Edison offset the disruption by bringing up some of its idled power generation units so that customer service was not disrupted. 3788 !C11 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Lam Research Corp said it will cut 11 percent of its workforce as part of a restructuring. It said about 310 regular and 240 contract positions have been eliminated, and that it will take a pretax restructuring charge in the first quarter of $11 million to $12 million, or $0.25 to $0.28 per share, fully diluted. The company said it is consolidating its business units into two functional organizations as well as a centralized marketing group to achieve appropriate economies of scale in operations and administration. The company said the first quarter restructuring charge includes costs resulting from severance and compensation and consolidation of related facilities. Lam chairman Roger Emerick said in a statement that the restructuring was adopted in order to "preserve ongoing profitability" during the current industry downturn. "This organization will enable Lam to align near-term expenses to prevailing market demands and provide the resources necessary to meet our customers' needs for next-generation products, and Lam's goals for long-term growth and profitability," he said. 3789 !C12 !C17 !CCAT !GCAT !GCRIM Lloyd's insurance market on Tuesday welcomed a crucial U.S. district court ruling in its favour and said it would extend a deadline for acceptances of a 3.2 billion pound ($5.5 billion) recovery plan. "We have decided in the circumstances we will keep the offer open," Lloyd's chairman David Rowland said after a district court in Baltimore, Maryland, overturned an injunction by U.S. Names -- as investors in the market are known -- who were unhappy with the plan. Rowland did not say how long the deadline would be extended from noon (1100 GMT) on Wednesday, but insurance sources said it would probably be stretched for several days to allow more U.S. Names to approve the plan. A Lloyd's spokesman said the ruling had removed the last major legal obstacle to the 300-year-old insurance market's recovery plan, aimed at ending years of turbulence triggered by huge liabilities. Lloyd's earlier said more than 82 percent of its 34,000 worldwide members had approved the plan, but only 53 percent of the 2,700 U.S. names had given the go-ahead. "Since we won the appeal, faxes have been flooding in from U.S. Names accepting the settlement offer," a Lloyd's spokesman said by telephone. Lloyd's hopes the support shown by Names will be enough to declare the plan unconditional when its ruling council meets on Thursday. The plan still has to be approved by the Department of Trade and Industry. Lloyd's problems began in the 1980s when a fatal combination of negligent underwriting, poor investment advice and a sequence of unexpected natural disasters conspired to bring about losses of several billion pounds. Long standing Names were for the first time in their lives suddenly faced with the prospect of unlimited losses. A spokesman for one of the three key litigating British action groups representing major loss-making Names described the successful appeal as "very good" for the recovery plan. "I think we did better by the settlement than by going through the courts," said the spokesman for the Merrett 418 Names Association, which groups 1,932 members. Under the proposals, Lloyd's will reinsure its massive liabilities in a new company called Equitas. It is asking investors to help fund Equitas but has offered them a compensation package to help offset their losses. Rowland said he was delighted by the U.S. ruling, which overturned a injunction granted by a lower court to a group of U.S. Names who wanted more time to study the terms of the settlement. "I am very pleased. I have believed for a long time that what we are doing is in the interest of the whole society," Rowland told Reuters, adding he did not want to exclude anyone from the offer. Many of the market's pre-1993 liabilities stem from pollution and asbestosis related claims in the United States, some of them dating back even to the last century. 3790 !GCAT !GCRIM !GVIO Armed Iraqis who hijacked a Sudanese airliner carrying 199 passengers and crew released all their hostages and surrendered in London on Tuesday after several hours of tense negotiations, police said. Seven suspected hijackers were arrested and police in black commando-style overalls boarded the plane to search for weapons. Police said they were still not sure what the men wanted, but said they had apparently asked for political asylum. Several had brought their families along, including children, they said. "We think they saw (Britain) possibly as a safe haven and somewhere that they would be received," Essex police chief John Burrow told a news conference. Burrow said the hostage-takers had agreed to surrender after an Iraqi exile became involved in the negotiations. The hijack started when Sudan Airways flight 150 left Khartoum for Amman on Monday night. The hijackers told the crew they had grenades and other explosives and threatened to blow up the plane if they were not taken to London, police said. The Airbus 310 airliner refuelled at Larnaca, Cyprus and landed at London's Stansted airport in the early hours of Tuesday after circling overhead for about an hour, Burrow said. Five hundred police, many armed, were deployed at the airport 30 miles (50 km) northeast of the capital. Negotiations began within an hour via radio and tired-looking passengers, many of them women carrying small children, trickled off the aircraft. Most of the passengers were Sudanese with an unknown number of Iraqis, Jordanians, Palestinians, Syrians and Saudis. Burrow said the hijackers demanded to speak to Iraqi exile Saddiq Sadda and asked that United Nations and International Committee of the Red Cross observers come to the airport. Sadda was brought to Stansted after a frantic police search. Burrow said his presence immediately defused the situation. "When we assured them 'Saddiq is here and he is prepared to witness the coming off from the aeroplane along with the United Nations and the Red Cross' they said 'Well, all right, that's enough for us'," he said. Burrow described the hijackers as "firm and disciplined" but denied they made any threats while in London. Police said passengers were calm despite their ordeal. Three men overcome by stress were taken to hospital in ambulances but police said they had not been ill-treated by the hijackers. Burrow said it would take several days to interview the passengers and hijackers, many of whom did not speak English, and piece together exactly what happened. Iraqi exiles condemned the hijacking. "The Iraqi National Congress is unequivocally opposed to hijacking and violence against innocent civilians," the London-based group said. "The situation under (Iraqi leader) Saddam Hussein's regime may lead some Iraqis to take desperate measures," it said. "It is possible the hijackers would prefer to live in a British jail than in Saddam's Iraq, but all Iraqis who believe in democracy and human rights would condemn terrorism and hostage-taking under any circumstances." The Iraqi National Congress said it believed an Iraqi diplomat was on the plane, but could not say if he was a passenger or a hijacker. Another group opposing Saddam, the Supreme Council of Islamic Resistance in Iraq (SCIRI), also attacked the hijackers. "However we think the internal situation in Iraq might push Iraqis to seek refugee status by wrong methods as they try to get out of the hell under Saddam's regime in Iraq." Members of Saddam's family defected to Jordan last year. Iraqi news media reported in February two of Saddam's sons-in-law were murdered by relatives days after returning home to a pardon from the Iraqi leader. 3791 !GCAT Following are some of the major events to have occurred on September 3 in history. 1189 - The coronation of England's King Richard the Lionheart took place at Westminster Abbey in London. 1658 - Oliver Cromwell of England, soldier and statesman who led parliamentary forces in the Civil War, died aged 59. 1783 - The Treaty of Paris, ending the American War of Independence, was signed by Britain and the United States. 1826 - Nicholas I was crowned Tsar of Russia in Moscow. 1877 - Adolphe Thiers, French statesman, prime minister and also first president of the Third Republic, died aged 80. 1879 - After a month-long siege, British residents in Kabul were massacred by Afghan troops. 1883 - Ivan Sergeyevich Turgenev, Russian author, notably of "A Month in the Country", died. 1900 - Urho Kekkonen, Finnish statesman and President from 1956-81, born. 1913 - U.S. film actor Alan Ladd born. Famous for his appearances in "The Blue Dahlia" and "Shane". 1914 - Cardinal Giacomo Della Chiesa was elected Pope as Benedict XV. 1918 - The allies forced the Germans back across the Hindenburg Line, which they had crossed in March. 1925 - The U.S. dirigible Shenandoah, the first airship to use helium gas, ran into a storm over southern Ohio and broke up in the air with the loss of 14 officers and men. 1939 - Great Britain and France declared war on Germany after its invasion of Poland. The Liner Athenia became the first ship to be sunk by a U-boat in the War, when it was torpedoed at 1945 hrs on the first day. 1943 - The British 8th Army invaded Italy from Sicily. 1948 - Eduard Benes, Czech statesman, died. Prime Minister from 1921-22, President from 1935-38 and 1946-48. He also headed the Czech government-in-exile during the war. 1965 - Hector Garcia Godoy was sworn in as President of the Dominican Republic, ending four months of fighting after a coup. 1967 - Sweden changed to driving on the right. 1967 - Nguyen Van Thieu wins South Vietnam's presidential election, with Nguyen Cao Ky as his vice-president. 1969 - Ho Chi Minh, President of North Vietnam from 1954 and one of the most influential of Communist leaders, died aged 79. 1971 - Four power agreement on Berlin was signed by the U.S., British and French ambassadors to West Germany and the Soviet ambassador to East Germany. The agreement came into force June 3, 1972. 1976 - U.S. spacecraft Viking 2 landed on Mars and began sending back photographs of the Martian landscape. 1978 - John Paul I was installed as Pope following his election in August - but he died on September 28. 1980 - Zimbabwe and South Africa closed their diplomatic missions in each others country. 1984 - New South African constitution came into effect, setting up a three-chamber, racially divided parliament for white, Indian and coloured (mixed race) people. 1990 - The Mongolian parliament re-elected reformist communist Punsalmaagiin Ochirbat as President. 1990 - Somalia's President Mohamed Siad Barre sacked his government amid intensified fighting between security forces and rebels. 1991 - Italian-born U.S. film director and three-time Oscar winner Frank Capra died. 1991 - Estonia, Latvia and Lithuania applied for membership of the United Nations. 1993 - Cambodia's government agreed to the country becoming a constitutional monarchy with Norodom Sihanouk returning to the throne. 1994 - Russia and China formally ended decades of confrontation and agreed to cease aiming nuclear missiles at each other. 3792 !CCAT !GCAT !GVIO British police will on Wednesday begin questioning seven armed Iraqis who apparently asked for asylum after hijacking a Sudanese airliner with 199 passengers and crew on board to London's Stansted airport. "The real grilling will start tomorrow," said a police spokesman late on Tuesday as the seven men were being held in prison after the episode ended peacefully. The hijackers seized the plane shortly after it left Khartoum on Monday and threatened to blow it up if they were not taken to London. The Airbus A-310 airliner refuelled at Larnaca, Cyprus and landed at Stansted early on Tuesday. A thorough police search of the plane only uncovered knives and fake explosives, triggering questions as to whether the seven men were guerrillas or refugees. Police said the suspects -- some of whom brought their families with them -- could well have considered Britain a safe haven from the rule of Iraqi leader Saddam Hussein. A Home Office (interior ministry) spokeswoman said the seven were likely to face criminal charges before any asylum bids could be considered. "Where a serious crime has been committed prosecution would generally follow first," she said by telephone. The maximum punishment for hijacking under British law is life imprisonment. Home Secretary Michael Howard can allow the suspects to stay in Britain if he thinks there are compelling humanitarian grounds but he is under pressure from right-wing members of parliament to deport them. "Hijacking is a horrendous and sometimes murderous crime and hijackers must be dealt with the utmost severity," said David Howell, chairman of the lower house of parliament's foreign affairs committee. During the incident a member of the airline crew was heard telling the control tower that the seven men were not guerrillas or fundamentalists. "They are ordinary people, they have been persecuted by Saddam regime. They need protection for their families," the unidentified crew member said. One of the men who staged the last hijack of an airliner to Britain in 1982 said he had cut a deal with Home Office officials which allowed him to stay after serving three years in jail. Yassin Membar, a Tanzanian dissident who hijacked an Air Tanzania jet to London, said it had been made clear that whatever happened he would not be sent home. "(They said) if we were found guilty we would be sent to prison but we would not be sent back to Tanzania because we believed our lives would be in danger at that particular time," he told British television. 3793 !GCAT !GCRIM !GPOL The head of Britain's prison service on Tuesday issued an abject apology to Home Secretary Michael Howard for an embarrassing blunder by jailers which led to 537 prisoners being released early from their sentences. "I profoundly regret these serious failures," Richard Tilt said after a stormy meeting with Howard, who ordered a halt to the releases last week. The prison service originally said 86 prisoners had been freed before Howard's intervention, but Tilt revealed that the actual figure was much higher. "I have offered the Home Secretary my sincere personal apology for the fact that he was not informed earlier of the problem and for the prison service's failures to appreciate the scale of the problem," he told reporters. Howard said he did not think Tilt should resign over the affair, which prompted the opposition Labour party to renew accusations of incompetence against the minister. The bungling is a further blow for Howard, who has been embarrassed in the past year by a string of adverse court rulings and by critical inquiries into break-outs from two top high-security prisons. Late last year Howard dismissed the head of the prison service, Derek Lewis, after Lewis had criticised him for interfering in the day-to-day running of jails. The early releases followed a legal challenge by inmates last year which led the court of appeal to rule that the prison service was miscalculating the time due to be served by many prisoners given consecutive sentences for a number of offences. For instance, a prisoner who spent a month in a remand centre before trial, and was then given three consecutive sentences, should have the total period he had to serve in jail reduced by three months, not one, it ruled. Howard said the law was not clear and should be decided in court but conceded many inmates might be entitled to compensation for having been kept too long behind bars. 3794 !C11 !C12 !CCAT !GCAT !GCRIM Lloyd's of London chairman David Rowland said on Tuesday that its Wednesday deadline for acceptances of its 3.2 billion stg settlement offer would be extended following a U.S. court ruling in its favour. "We have decided in the circumstances we will keep the offer open," Rowland told Reuters in an interview. Rowland said the decision to keep the offer open beyond the Wednesday noon (1100 GMT) deadline was also due to the level of acceptances already received for the plan. Earlier, Lloyd's said more than 82 percent of its worldwide membership had accepted the offer, up from the 75 percent acceptance level it had announced on Saturday. He said he was delighted by the U.S. court ruling, which overturned a injunction granted by a lower court to a group of U.S. Names -- as investors in the London market are known. "I am very pleased. I have believed for a long time that what we are doing is in the interest of the whole society," Rowland said, adding that he did not want to exclude anyone from the offer and was therefore lifting the deadline. Rowland said he was confident the 300-year-old insurance market's reorganisation plan would go ahead. Under the proposals, it will reinsure its massive liabilities in a new company called Equitas. It is asking investors to help fund Equitas, but has offered them a compensation package to help offset their losses. Asked if he expected the U.S. Names to take the case to the U.S. Supreme Court, Rowland said he did not know and could not comment on the possibility. He said that, while he had no doubt other problems would arise in the future, they would not be of the same nature. And while delighted at the level of acceptances and the court ruling, he said there were still obstacles to be overcome before the reconstruction plan was home and dry. "I have said in terms of the reconstruction and renewal plan, no deal is done until it is completed," he said. Not only would funding for Equitas have to be finalised, but the plan would also have to be approved by the Department of Trade and Industry (DTI), he said. Final approval of the recovery plan would also be subject to a formal council meeting on Thursday, he added. -- Alexander Smith, London Newsroom ++ 44 171 542 7719 3795 !C12 !CCAT !GCAT !GCRIM Lloyd's of London said it would press ahead with its re-organisation plan after a U.S. court granted the insurance syndicate a last-minute reprieve from an injunction by a group of U.S. investors. "We are very pleased indeed. This decision removes the last major legal obstacle we were facing. Now we can move ahead with our own timetable," spokesman Nick Doak told Reuters by telephone. Lloyd's said earlier on Tuesday that over 82 percent of its worldwide membership of 34,000 had accepted the terms of its 3.2 billion stg settlement offer. "It is clear that the vast majority of Names have not allowed themselves to be deterred from accepting the offer by the uncertainty generated by these court proceedings," Lloyd's chairman David Rowland said in a statement after the U.S. court in Baltimore announced its decision. 3796 !GCAT !GPOL !GVIO A spokesman for Northern Ireland's Protestant "Loyalist" gunmen suggested on Tuesday that their 22-month ceasefire was at risk because of the failure of their IRA foes to restore their own ceasefire. David Ervine of the Progressive Unionist Party said in an article for the Belfast Telegraph that Loyalist gunmen now believed there was little chance that the IRA would renew a ceasefire it ended in February with a big bomb attack in London. "The time has long since passed for the hope of a restored IRA ceasefire, " said Ervine, a leading spokesman for Loyalists who take their name from allegiance to the British crown. Ervine, whose party is close to the outlawed Ulster Volunteer Force guerrillas, said Loyalists and Unionists, who want the province to remain British, felt threatened by the Irish Republican Army's continued war on British rule. "The basis of the UVF/Red Hand Commando thinking at the time is for the survival of the Unionist population and their way of life," wrote Ervine. The Red Hand is another Loyalist guerrilla organisation committed to fight what it sees as a threat, supported by the Irish government, to end British rule and reunite the province with the predominantly Catholic Irish republic. Ervine's statement was certain to raise the political temperature in Northern Ireland again in the run-up to the resumption in Belfast on September 9 of faltering Anglo-Irish peace talks supposed to reconcile all sides. The talks include Ervine's PUP but exclude Sinn Fein, the political wing of the IRA, becauuse of the IRA's decision to return to war in February with a wave of bomb attacks in Britain and one on a British army base in Germany. The British and Irish governments hope that if the talks progress well, the IRA's governing Army Council might call a new ceasefire to get Sinn Fein invited and the topic of reunited Ireland put on the talks' agenda. Ervine was sharply critical of the Irish government which he accused of trying to get Sinn Fein included in the talks without meeting the precondition of a ceasefire. "Elements of the Irish government and opposition have felt it necessary to stand shoulder to shoulder with the Provos (IRA) in relation to talks without a ceasefire. "I have never known the level of hatred for the Irish government to be as severe as it is now. Loyalists see the Irish government as being wholly dubious and I don't think that augurs well," said Ervine. Irish Prime Minister John Bruton told reporters in Dublin that he was ready to talk to Ervine or any other Loyalist figure to persuade him of the Irish government's determination to be even-handed to Loyalists and Irish nationalists alike. This weekend is the second anniversary of the IRA's August 31 ceasefire which raised hopes of a new deal for the troubled province after the loss of 3,200 lives in 25 years. Britain says the surrender of IRA and Loyalist arms must be part of any peace talks but the IRA says it will accept no preconditions and dismisses talk of an arms handover as ludicrous. 3797 !C12 !C16 !CCAT !GCAT !GCRIM Lloyd's of London said on Tuesday that over 82 percent of its worldwide membership of 34,000 had accepted the terms of its 3.2 billion stg settlement offer. "I am encouraged by the steady flow of acceptances we have received since midday on Saturday. At that time 75 percent of our members had accepted," chairman David Rowland said in a statement. "I am confident that the acceptance level will have increased yet again by the time our deadline is reached at noon tomorrow (1100 GMT)," Rowland added. -- London Newsroom +44 171 542 7717 3798 !GCAT !GODD The 63 inhabitants of the island of Eigg off the coast of Scotland prepared on Tuesday to launch a worldwide appeal for money to realise their dream of making its 7,534 acres (3,502 hectares) their own. The hardy crofters and fishermen will use the Internet as well as approaching businesses and individuals and Britain's National Lottery in an attempt to raise 800,000 pounds ($1.25 million). They believe the money could be enough to purchase the island, seven miles (10 km) from the north-west mainland port of Mallaig, from the latest of a series of absentee landlords -- German artist Marlin Ekhart Maruma. Maruma, who has owned the island of moorlands, fertile fields and spectacular beaches for just 18 months, has put Eigg up for sale with a price tag of two million pounds ($3.1 million), a figure the inhabitants see as unrealistic. "We are determined to take our destinies in our own hands. This is the best chance we will ever get to make a go of things on Eigg," said Maggie Fyffe, secretary of the inhabitants' Isle of Eigg Trust. Absentee landlords have been resented in the Scottish highlands ever since the 19th century "Clearances" in which whole villages were forced to emigrate when "lairds" decided arable land should be used as grazing for sheep. 3799 !GCAT !GSPO (Compiled for Reuters by Media Monitors) THE AUSTRALIAN Victorian Premier Jeff Kennett has entered the Hawthorn-Melbourne Australian Football League merger debate by urging the League to allow those lobbying to retain independent clubs to put their case to members. Page 20. -- Brisbane Bears have thwarted AFL newcomers Port Power again by signing star goalkicking utility Craig McRae for another four-years. Last week the Bears fended off a Port Power attempt to offer star rookie Clark Keating a lucrative contract. Page 20. -- Canberra Raiders have reinstated prop John Lomax for Sunday's Australian Rugby League clash against South Queensland after it was revealed the fracture in his hand was only minor. Page 20. -- THE SYDNEY MORNING HERALD NSW Rugby Union Coach Chris Hawkins reign is over following last night's surprise announcement by NSW Rugby Union saying it and Hawkins had mutually agreed the coach will not continue the second year of his contract due to Hawkins' other commitments. Page44. -- Sydney Swan's star Tony Lockett may still be in doubt for Saturday night's AFL clash against West Coast following a flare-up of a recurring knee-injury. Coach Rodney Eade has given Lockett a 60/40 chance of having a kick this weekend. Page 44. -- National Basketball League's Sydney Kings have decided to focus on improving their last few minute's play after losing a number of close matches this season. Star player Isaac Burton feels losing to Hobart last week by a point has driven the point home that the team needs to be stronger in the final stages. Page 44. -- THE AGE The Australian Football League had dramatically increased pressure on Joseph Gutnick and the International Management Group to stop them from separately funding clubs Hawthorn and Melbourne and scuttling any merger moves. Page C20. -- The Australian Football League, amongst other things, yesterday slugged the Sydney Swans a total of $4000 in fines following club director Ron Barassi breaking an AFL ruling and making comments about the Tony Lockett incident before it went to Monday's trbunal. Page C20. -- Steve Waugh's top-score of 82 off 70 balls added to Australia's 125-run win over Zimbabwe in the Singer Cup in Columbo yesterday. Zimbabwe with 138 all out in 41 overs lost to Australia's 7/263. Page C18. -- HERALD SUN Australian Football League Operations chief Ian Collins fears his public fallout with former league investigator Martin Amad will result in being over-looked for the leagues top job after the retirement of Ross Oakley. Page 88. -- Carlton will discover today whether AFL veteran star Greg Williams will be sidelined for the rest of the 1996 season following Williams' chronic knee complaint. It is believed the centreman will decide today to undergo surgery on his right knee. Page 86. -- National Basketball League club-owners and executives will begin crucial talks today for a three-day conference on the future of the sport in Australia. The prospect of a summer basketball competition has for 1997 has already been vetoed by clubs. Page 86 -- THE DAILY TELEGRAPH NSWRU has parted ways with Waratah's coach Chris Hawkins. It is believed both parties expired Hawkin's 1997-expired contract mutually. Matt Williams, the teams full time manager is being tipped to take over from Hawkins. Page 76. -- Sydney is being considered as the permanent home for the Sport Australia Hall of Fame. The Sport Australia Hall of Fame trust is currently assessing potential sites near Homebush Olympic Stadium and Darling Harbour. Page 74. -- Manly forward Solomon Haumono has had to undergo microsurgery to repair the powerful Australian Rugby League forward's career-threatening arm injury. Haumono will be sidelined following a cut in his arm which severed tendons in his right forearm. Page 70. -- Reuters Sydney Newsroom 61-2 9373-1800 3800 !GCAT !GSPO A Canadian newspaper publisher is mounting a campaign to strip U.S. sprinter Michael Johnson of his title as the world's fastest man. Ian Oliver, publisher of the Oakville Beaver near Toronto, said on Tuesday he would start publishing ads in the USA Today newspaper to push his view that Canadian runner Donovan Bailey (corrects spelling of first name from Donovon) is actually the fastest man alive. Bailey, who comes from Oakville, wowed Canada with his record-smashing victory in the 100-meter race at the Atlanta Olympics. Johnson, from Dallas, won the 200- and 400-meter races, setting a new record in the 200-meter competition. Oliver said he became angry when NBC television commentators began calling Johnson the world's fastest man, a title he said traditionally goes to the winner of the 100-meter race. "I was getting angry at the way NBC was covering the Olympics," he said. "The way anybody who wasn't American didn't really count." Oliver said so far he has received C$7,000 (U.S. $5,147) in donations and thousands of calls and letters in support of the campaign. The first advertisement will run in the Dallas edition of USA Today this week, with another in the New York regional edition next week. The bill for both advertisements will be about $48,000 (U.S. $35,112) but Oliver said he was sure the mounting donations would cover the cost. 3801 !GCAT !GSPO Ireland's most experienced player, defender Paul McGrath, was left out of the national squad for the first time in 11 years on Tuesday when new manager Mick McCarthy named his side to face Liechtenstein in a World Cup qualifier. The 36-year-old Aston Villa player won the last of his Irish record of 82 international caps against the Czech Republic in Prague in April. "Paul accepted the situation. He hasn't played any first-team games for Villa this season and he's not the type of player I would have brought on as a substitute," McCarthy said. "But he surprised me in training over the last two days because of his involvement. He's certainly is still very much part of my plans for the future. "At 24, 25 or 26 you could get away with it, not having played first-team games. But at 36 it would be asking too much of Paul," he said. Also omitted from the 20-man squad which will travel to Vaduz for Saturday's group eight match are central defenders Alan Kernaghan and Liam Daish. Leeds United defender Gary Kelly is unable to travel because of a knee injury picked up in Monday's 1-0 victory over Wimbledon at Elland Road. Since taking over from Jack Charlton in February, McCarthy has played largely experimental sides and seen them lose five times, draw twice and win just once. Squad: Alan Kelly, Shay Given, Denis Irwin, Phil Babb, Jeff Kenna, Curtis Fleming, Gary Breen, Ian Harte, Kenny Cunningham, Steve Staunton, Andy Townsend, Ray Houghton, Gareth Farrelly, Alan McLoughlin, Jason McAteer, Alan Moore, Keith O'Neill, Tony Cascarino, Niall Quinn, David Kelly. -- Dublin Newsroom +6613377 3802 !GCAT !GPOL CONGO GOVERNMENT LIST (960827) *********************************************************** * 27 Aug 96 - Congo's President Pascal Lissouba named * * Charles David Ganao as prime minister to * * head a government which will run the country* * until presidential elections in 1997. * *********************************************************** President (sworn in 31 Aug 92)................ Pascal LISSOUBA - - - - - - - Prime Minister............................Charles David GANAO (Apptd 27 Aug 96) (SEE NOTE ABOVE) - - - - - - - OUTGOING GOVERNMENT: (Formed 23 Jan 95) (Resigned 24 Aug 96) Prime Minister (apptd 23 June 93)........... Jacques Joachim YHOMBI-OPANGO - - - - - - - MINISTERS OF STATE: Administrative & Economic Decentralisation...... . Martin MBERI Interior, Security & Urban Development..................... . Philippe BIKINKITA - - - - - - - MINISTERS: Agriculture, Livestock, Water & Forestry & Fisheries.........................Prosper KOYO Communication & Government Spokeswoman........... . Albertine Lipou MASSALA Culture......................................Gabriel MATSIONA Defence.......................Maurice Stephane BONGHO-NOUARRA Development, Mines & Energy, Post & Telecommunications..............Jean ITADI Economy & Finance....................Nguila MOUNGOUNGA-NKOMBO Education & Scientific Research & Technology.............Martial de Paul IKOUNGA Equipment & Public Works....................Lambert NGALIBALI Foreign affairs.........................Arsene TSATY-MBOUNGOU Health & Social Affairs.......................... Jean MOUYABI Justice, Administrative Reform................ . Joseph OUABARI Labour, Civil Service, Social Security...... Anaclet TSOMAMBET Oil......................................... . Benoit KOUKEBENE Trade, Small & Medium-Sized Businesses...... Marius MOUAMBENGA Transport & Civil Aviation....................Seraphin GOMPET Women's Integration in Development......Marie-Therese AVEMEKA Youth & Sports...............General Claude Emmanuel ETA-ONKA - - - - - - - National Assembly Speaker.......................Andre MILONGO - - - - - - - Central Bank Governor....................Jean-Felix MAMALEPOT (Central bank of Central African States) Central Bank Director.......................... Gabriel BOKILO - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End Government List) 3803 !GCAT !GPOL SLOVAK REPUBLIC GOVERNMENT LIST (960827) President........................................Michal KOVAC (Sworn in 2 Mar 93 for a five-year term) - - - - - - - COALITION GOVERNMENT (Sworn in 13 Dec 94) (See end of list for party affiliations) Prime Minister.........................Vladimir MECIAR (HZDS) Deputy Prime Minister....................Sergej KOZLIK (HZDS) (Also Minister of Finance) Deputy Prime Minister................ Katherina TOTHOVA (HZDS) Deputy Prime Minister..................... . Peter KALMAN (ZRS) - - - - - - - MINISTERS: Agriculture.................................Peter BACO (HZDS) Construction & Public Works....................Jan MRAZ (ZRS) Culture.................................... . Ivan HUDEC (HZDS) Defence.......................................Jan SITEK (SNS) Economy...................................Karol CESNEK (HZDS) Education............................... . Eva SLAVKOVSKA (SNS) Environment............................... Jozef ZLOCHA (HZDS) Finance........................................See Deputy PMs Foreign Affairs.......................... . Pavol HAMZIK (HZDS) Health............................... . Lubomir JAVORSKY (HZDS) Interior.................................Gustav KRAJCI (HZDS) Justice.................................... Jozef LISCAK (ZRS) Privatisation............................... Peter BISAK (ZRS) Social Affairs.......................... Olga KELTOSOVA (HZDS) Transport & Communications.............Alexander REZES (HZDS) - - - - - - - PARTY AFFILIATIONS: HZDS - Movement for a Democratic Slovakia ZRS - Workers Party SNS - Slovak National Party IND - Independent - - - - - - - Central Bank Governor.......................... Vladimir MASAR - - - - - - - NOTE: Any comments/queries on the content of this government list, please contact the Reuter Editorial Reference Unit, London, on (171) 542 7968. (End Government List) 3804 !C21 !C24 !CCAT !GCAT !GWEA !M14 !M141 !MCAT Canada's northwest Prairie grainbelt was forecast to see a slight risk of frost Saturday and Sunday mornings, Environment Canada said. A warm to hot southerly air flow was forecast to track across the Prairies through Friday, eliminating any risk of frost in that period, Environment Canada said in its 10-day frost outlook. A cold front was forecast to move in with a weak high near Alberta's Rockies which may bring a slight risk of frost to the Peace River Valley Saturday and Sunday mornings. A moderate risk of frost was forecast for the Peace River Valley September 2 to 6. A slight risk of frost was forecast for Alberta's northern grainbelt September 2 to 6. As of August 21, swathing of western Prairie crops had begun with the harvest expected to become general in the period August 28 to September 4, according to the Pioneer Grain Co's latest crop report issued August 23. -- Gilbert Le Gras 204 947 3548 3805 !E51 !E511 !ECAT !GCAT !GTOUR Seventeen percent more Canadian tourists fled to Florida in the first quarter of this year than the same period of 1995, Statistics Canada said on Tuesday. A total of 915,000 Canadians visited the Sunshine State, down from a peak of 1.1 million in 1993. A weaker Canadian dollar, reduced coverage of Canadian medical expenses abroad and reported violence against foreign tourists contributed to the decline. But Statistics Canada said the February 1995 signing of the Open Skies Agreement between Canada and the United States has facilitated air travel. It said the increase in tourism to Florida was almost entirely due to a 33 percent jump in air travel. The Canadian winter had also arrived early and struck hard last year. Travel to Mexico rose to 246,000 visits in the first quarter 1996 from 212,000 five years earlier, during which time travel to Cuba more than doubled to 139,000 visits from 65,000. -- Reuters Ottawa Bureau (613) 235-6745 3806 !GCAT !GPOL Angola's former rebel movement UNITA rejected on Tuesday the position of vice-president in a unity government offered to its leader Jonas Savimbi. "The third extraordinary congress of UNITA rejects the nomination of its president Jonas Savimbi as vice-president," UNITA's information secretary Marciel Dachala told a news conference in the central highlands town of Bailundo. The vice-presidency, one of two in the proposed government, was offered to UNITA by Angolan President Jose Eduardo Dos Santos after he and Savimbi signed a peace accord in 1994 intended to put a final end to 20 years of bitter civil war. Dachala said the week-long congress had resolved to transform UNITA into a political party without its armed wing, and with Savimbi as its leader. "At this moment the presence of its president (Savimbi) is needed more than ever," he said. Loud cheers and shouting in support of the decision on the vice-presidency broke out among the 1,500 delegates invited to attend the press conference. Savimbi, 62, stayed seated on the stage at the announcement, keeping a straight face. Portuguese media, quoting a UNITA communique, earlier reported that UNITA had accepted the vice-presidency for the party, although not for Savimbi. TSF radio also reported the congress had suggested that UNITA's chief constitutional negotiator Abel Chivukuvuku, or vice-president Antonio Tembo, take the job. But Savimbi would not be drawn during questions to say who would occupy the position, or if UNITA would take up the post at all. "I am not here to discuss the vice-presidency...We came here to discuss the peace process so that political stability and peace can return to Angola," the UNITA leader told reporters. Later, he said: "The vice-presidency is just one of the points we came to discuss." The civil war between UNITA and dos Santos' former Marxist MPLA began after Angola's independence from Portugal in 1975. The two sides signed their peace pact in November 1994, agreeing to integrate their armies into a single national military force and proposing the unity government. But implementation of the deal has been slowed by lingering suspicions. About 6,500 United Nations troops, costing over $1 million a day, have been helping to implement the plan, especially the disarming of UNITA's fighters at assembly camps. Savimbi said he wanted to play a vital role in restoring stability to his country. "I have said that President dos Santos is the president of Angola and therefore he is my president. But that does not mean necessarily that he has to give me a job. "I can play an important role in bringing about peace and stability in Angola. I am prepared to play that role alongside the president (dos Santos) and with other opposition parties," Savimbi said, without elaborating. A government delegation will travel to Bailundo on Thursday to meet Savimbi to discuss a date for a meeting between Savimbi and dos Santos. The government has proposed that the talks take place on September 15. 3807 !GCAT !GPOL Congo's President Pascal Lissouba on Tuesday named former foreign minister Charles David Ganao as prime minister to head a government which will run the country until presidential elections next year. A presidential decree announced the appointment of Ganao, 68, who was foreign minister in the 1970s under the Marxist-Leninist rule of President Marien Ngouabi. Outgoing prime minister Jacques Joachim Yhombi-Opango presented his government's resignation on Friday and on Tuesday Lissouba appointed him as head of his Presidential Movement and as his campaign manager for elections next year. Ganao is president of the Union of Democratic Forces, a party close to Lissouba's Presidential Movement. The Presidential Movement comprises Lissouba's Pan-African Union for Social Democracy (UPADS) and allied parties. Presidency sources said Ganao held a long meeting on Tuesday afternoon with Lissouba, who said recently that he wanted to get rid of certain ministers and form a campaign government for the run-up to presidential elections due next August. "The head of state has just confirmed to me that I won the first battle by obtaining an Enhanced Structural Adjustment Facility from the International Monetary Fund and the time has come for me to go on to something else," Yhombi-Opango told state radio earlier on Tuesday. Oil-producing but impoverished Congo signed a three-year programme with the IMF in June. The Paris Club of official creditors agreed in July to write off two-thirds of the Central African country's external debt. Disputed parliamentary elections in May and June 1993 were followed by urban warfare between tribal militias in Brazzaville. At least 2,000 people are thought to have died before a truce in January 1994 halted the worst of the fighting. Opposition leaders and Lissouba supporters signed a peace pact last December agreeing to disarm their militias. 3808 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL Zimbabwe's Congress of Trade Unions (ZCTU) threatened on Tuesday it might call a general strike if the government continued to reject negotiations with striking civil servants. ZCTU president Gibson Sibanda said it was giving the government of President Robert Mugabe, who left the country for Kenya earlier on Tuesday, until Friday to resolve the standoff with its striking workers which has paralysed some key social services. The ZCTU is an umbrella group of all Zimbabwe's independent trade unions which include the key agriculture and mining sectors. "The ZCTU general council had a meeting today, and we resolved to implore the government to come to the negotiating table for a quick resolution of the issues," Sibanda told reporters. "If by Friday these issues are not resolved we are going to review our position and further action is bound to be taken. We are not ruling out the question of calling out a nationwide strike for all other workers in an effort to force government to come up with a resolution," he added. The government has so far remained uncompromising on its decision to fire the striking civil servants -- including nurses, junior doctors, mortuary attendants, prosecutors and firefighters -- for defying an order to end their week-long action. Public Service, Labour and Social Welfare Minister said in a statement on Tuesday her ministry had so far compiled a list of 7,000 workers for formal notices of dismissal for taking part in the strike which has posed a rare challenge to Mugabe and his dominant ZANU-PF party, both in power since 1980 independence. Public Service Association (PSA) union officials say 70 to 80 percent of the country's estimated 180,000 civil servants were on strike to press demands for pay hikes of between 30 and 60 percent. Some senior officials said the tough stance the government had taken was for public view and that it was making desperate private efforts to end the crisis which has left key social services barely functioning. "That's the government's public position, but privately I can tell you that the government is making desperate efforts to find some compromise," one senior official told Reuters. "We just cannot afford the expense whatever angle you look at it," another official said, adding the government was considering enticing strikers back to their jobs with a 20 percent wage rise and open-ended talks on salaries and working conditions. Both officials declined to be named. The civil servants, who earn an average Z$1,000 (U.S.$99) a month, say their wages have not matched high inflation which has averaged 22 percent in the last two years. ($1=10.12) 3809 !C21 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Air traffic is flying normally in and out of Zimbabwe despite a strike over pay by civil servants but some internal flights to major tourist destinations have been disrupted, an Air Zimbabwe official said on Tuesday. David Mwenga, spokesman for the state carrier, the main flyer to the tourist spots, said the airline had suspended flights to the Hwange game park in western Zimbabwe, and Kariba, in the north, because airport firefighters were on strike. "We have not been operating these airports on international safety standards because they don't have fire protection. It's risky to send out an aircraft without firemen around in case it catches fire at take-off or landing," he told Reuters. "We had a skeleton staff of senior firemen at Harare last week, helped by Air Force firemen but some of the striking workers came back and we are okay now," he added. Mwenga said this had also caused delays of some of Air Zimbabwe's internal and international flights, adding this had also affected the transport of cargo. He added the airline's scheduling and cargo problems were worsened by the grounding of its two long-haul aircraft for "unscheduled" maintenance checks. The airline was now using a plane normally reserved for internal destinations. He said flights to Zimbabwe's main tourist destination, Victoria Falls, were also back to normal after the airport asked for help from the Air Force fire control department. Air Zimbabwe and South African airlines suspended flights there at the end of last week as the strikers pressed ahead with their demands for higher wages. On Tuesday, Mwenga said tourists to Hwange and Kariba were now being rerouted there and taken by road to their original destinations. ---Harare Newsroom: +263-4 72 52 27/8/9--- 3810 !C42 !CCAT !E41 !ECAT !GCAT !GCRIM !GJOB !GVIO Labour Minister Tito Mboweni backed a wide-ranging inquiry into South Africa's violence-plagued mining industry on Tuesday, as another miner was killed in fighting at a gold mine southwest of Johannesburg. Mine management told state radio the 33-year-old worker was stabbed to death in a fight at East Driefontein, a division of Driefontein Consolidated Ltd. They gave no reason for the latest flare-up of violence. At least 25 miners have been killed and scores injured in recent weeks in fights on four mines run by Gold Fields of South Africa Ltd. The violence has hit output at the affected three gold mines, including East Driefontein, and one platinum operation. Gold Fields has attributed the violence to clashes between the 350,000-strong National Union of Mineworkers (NUM) which has a largely Xhosa membership and the smaller United Workers' Union of South Africa, aligned to the Zulu-led Inkatha Freedom Party. "We are extremely concerned," Mboweni told a Cape Town news conference after talks with NUM President James Motlatsi and Deputy Mineral Affairs Minister Susan Shabangu on Tuesday. The meeting was requested by Motlatsi. Mboweni said he had also discussed the violence with Gold Fields head of gold mining Alan Munro, who had been "very cooperative", and would meet police minister Sydney Mufamadi on Wednesday. South Africa's mining industry was built on a labour system whereby men left their wives and families for months at a time to work on the mines. Mine hostels were largely segregated on ethnic lines, with Zulus, Xhosas or Basotho each in separate quarters. Motlatsi told reporters he had proposed to Mboweni that a comprehensive commission of inquiry be instituted to deal with the migrant labour system and "the command structure" on mines. "The mining industry is the founder of apartheid, was a pillar of apartheid, so we need to look at that pillar to see how we make it possible to move towards the direction of democracy," the union leader said. Mboweni said he favoured the proposal and would discuss it with cabinet colleagues. "I think it's important. Why is it that segregation along ethnic lines still exists? What is it that causes these fights to take an ethnic dimension? "...If the government agrees to it I think it would be good to proceed with it as soon as possible. "It is quite clear that some of the root causes of this violence are historical and in a sense some of the chickens are coming home to roost at the wrong time when now there is a democratic government," Mboweni said. 3811 !GCAT !GCRIM !GPOL !GVIO Former police colonel Eugene de Kock was convicted of six murders and 83 other crimes on Tuesday in South Africa's first trial of apartheid-era "death squads". De Kock, 48, faces life imprisonment on each murder charge but could escape jail if Archbishop Desmond Tutu's Truth and Reconciliation Commission grants his request for amnesty in exchange for testimony against former cohorts. South Africa abolished the death penalty in June 1995. Pretoria Supreme Court Judge Willem van der Merwe convicted de Kock of five murders on Monday, and on Tuesday found him guilty of blowing up a black activist as well as the attempted murder of his former hit-squad boss. The judge further convicted de Kock of 66 fraud charges and 17 others including one attempted murder, two counts of conspiracy to murder, culpable homicide and illegal possession of arms and explosives. De Kock, who has admitted he was the "most effective assassin" under white rule, returns to court on September 16, when his lawyers are to begin their argument in mitigation of sentence. There is no indication as yet on when the truth commission will hear his appeal for amnesty. Van der Merwe said de Kock -- dubbed "Prime Evil" by his colleagues -- tried to kill his predecessor Dirk Coetzee, commander of a ruthless hit-squad unit based near Pretoria, which wiped out opponents of apartheid. Coetzee, who has claimed responsibility for several political assassinations ordered by apartheid chiefs, sang out in 1989 about the white government's death squads and became himself a target of the unit he had led until 1985. Earlier in the trial a policeman tesitified that de Kock and others sent a package with tapes, headphones and explosives -- first tested on a pig's head -- to an address in Zambia where Coetzee, who had meanwhile joined Nelson Mandela's African National Congress, was supposed to fetch it. But the post office sent the unopened deadly package, marked with ANC lawyer Bheki Mlangeni's return address, to the death squad investigator and killed him. The judge convicted the bespectacled ex-colonel of culpable homicide in that case. De Kock, who was expressionless throughout the two-day judgment, was also found guilty of the 1991 murder of police informer Goodwill Sikhakhane, who was shot in the head. "I am satisfied the accused gave the order to murder," van der Merwe said. On Monday de Kock was convicted of planning and executing the ambush and murder of five black men, including a driver of Mandela's former wife, Winnie Mandela. De Kock ran the covert police base at Vlakplaas farm near Pretoria and had the authority to use unconventional methods to combat "terrorism", according to evidence in court. Former president F.W. de Klerk apologised for apartheid at a truth commission hearing in Cape Town a week ago but said he had never "individually, directly or indirectly" sanctioned state killings. The 12,000 pages of evidence and 3,000 exhibits compiled over nearly two years for his trial have provided a litany of the death and mayhem integral to the "old" South Africa. The accusations included massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police. De Kock started his career as a killing machine 27 years ago as an ordinary policeman before leaving to fight black liberation guerrillas in former white-led Zimbabwe. Back home, he formed a security police unit that tried to thwart the South West African People's Organisation (SWAPO) in its fight for Namibian independence from South Africa. In 1980 he joined the now notorious Vlakplaas unit. When he was arrested early in 1994, he had eight passports and had stashed millions of rand (dollars) in offshore banks. De Klerk's former government contributed to de Kock's wealth when they bid him farewell in April 1993 with a golden handshake of 1.2 million rand (now worth about $265,000). The government also agreed to a watertight contract with de Kock for the taxpayer to pay all his legal costs, which so far total over four million rand ($885,000). 3812 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL Zimbabwean officials said on Tuesday President Robert Mugabe's government was making desperate private efforts to end an unprecedented civil servants' strike crippling essential services. The civil servants, who earn an average Z$1,000 (U.S.$99) a month, say their wages have not matched high inflation which has averaged 22 percent in the last two years. Thousands of people, including doctors, nurses, mortuary attendants, magistrates and firefighters, stayed away from work for the seventh consecutive day, demanding higher wages and ignoring the government's public stance that it had fired them. "That's the government's public position, but privately I can tell you that the government is making desperate efforts to find some compromise," one senior official told Reuters. "We just cannot afford the expense whatever angle you look at it," another official said, adding the government was considering enticing strikers back to their jobs with a 20 percent wage rise and open-ended talks on salaries and working conditions. Both officials declined to be named. The government's annual wage and allowances bill currently stands at Z$8.6 billion (U.S.$850 million). Zimbabwe's dominant state media, apart from the official news agency ZIANA, has imposed a news blackout on the strike crisis, except for government statements. The work stoppage has left key social services barely functioning. Public Service Minister Florence Chitauro said on Tuesday the strikers were dismissed for defying orders to return to work last Friday, and the government was now hiring new civil servants. "That is the position and there will be no change. I fully briefed His Excellency (Mugabe) and he fully endorsed cabinet's decision to fire those who did not return to work," she said. Public Service Association (PSA) officials estimate that 70 to 80 percent of the 180,000 civil servants are on strike. They are demanding wage rises of between 30 and 60 percent. The government says it has no money and has restricted pay rises for civil servants to a maximum nine percent, which they rejected as unacceptable. Their strike has paralysed many essential social services, including hospitals where army and Red Cross medical personnel are helping out senior doctors attend to emergencies only. Air traffic controllers have warned the public that although some airports, including Harare International, have drafted the services of military and city council firefighters, "the situation still compromises safety". Independent economists said the economic costs of the strike were rising as tax and customs duty collection fell behind. Politically, the costs include growing divisions in Mugabe's government on how to handle the strike, with more senior officials from his ruling ZANU-PF party privately supporting those who have backed the strikers' demands for higher salaries. The current strike has also renewed public focus on Mugabe, who has been dogged by accusations of economic mismanagement, of being arrogant and sometimes out of touch with the public mood over his 16-year-old rule. ($1=Z$10.12) 3813 !GCAT !GDIP !GVIO The final Rwandan refugee camp in Burundi closed on Tuesday and 6,000 refugees left for Rwanda, ending the biggest repatriation since Rwanda's genocide in 1994. "Rukuramigabo camp is closed as of now. This marks the end of the seven Rwandan refugee camps created in Burundi in 1994," said Paul Stromberg, spokesman for the U.N. High Commissioner for Refugees (UNHCR). More than two million Rwandan refugees fled into Burundi, Tanzania and Zaire in 1994 in fear of reprisal attacks for the genocide of up to one million Tutsis and Hutu moderates. Burundi was once host to more than 250,000 of the refugees. On one of the 73 trucks and buses heading for Rwanda from Burundi on Tuesday refugees prayed, vomited, clutched crucifixes or slept as they crossed the border into their homeland. Some excitedly pointed out their home communes inside Rwanda to a Reuters correspondent with them on the truck. "I was almost a child when I left home," said 12-year-old Anne-Marie Haziyimana near her home commune of Huye outside the southwest town of Butare, a site of some of the worst massacres during the 1994 genocide by Hutu troops, militiamen and mobs. "My father says everything is going to be safe for us but I don't know until we see our house is still there. I hated being in Burundi because of the soldiers in the camps," she said. Her father, holding her hand and with a crucifix around his neck, said he was excited about returning home. Some 1.1 million Rwandan refugees remain in camps in eastern Zaire -- at a cost of $1 million in international aid per day -- and 600,000 in Tanzania since they fled during civil war and genocide. A total of 223 Rwandan Hutu refugees from Magara, the biggest camp in Burundi, refused to go home when it closed last Thursday and were allowed by Burundian authorities to stay. They say they fear arrest or attack if they return home. "The operation was carried out extremely well. The remaining refugees went back without any problems," said Pirjo Dupuy, acting chief of UNHCR in Burundi where the Tutsi-dominated army seized power on July 25. Officials said a combination of factors prompted the return including a hostile local environment, uncertain security and pressure from an economic embargo on Burundi that is creating tensions. Refugees began flooding back when Tutsi military ruler took power in Burundi on July 25. The Hutus have accused troops of harassing them and three were killed by Burundian soldiers on August 18. Zairean Prime Minister Kengo wa Dondo said last week Zaire and Rwanda had agreed an "organised, massive and unconditional" repatriation of the Rwandan refugees in eastern Zaire. UNHCR was not consulted in advance about the Zairean-Rwandan agreement, which prompted a Rwandan Hutu refugee lobby group to warn expulsions of refugees from Zaire could start within days. Rwandan authorities screen returning refugees and arrest any suspected of involvement in genocide. There are nearly 80,000 prisoners and detainees held in prisons and lockups in Rwanda. 3814 !E41 !ECAT !GCAT !GJOB Sierra Leone's new civilian government is to toughen rules for foreign workers, who employment minister Mohamed Gassama says are taking jobs from unemployed Sierra Leoneans. Gassama said in an interview on Tuesday new rules meant more than 1,000 foreign workers in what he described as non-essential positions, most of them Indians, Lebanese, Senegalese, Guineans or Liberians, would have to leave the country. He told Reuters some 2,000 Sierra Leonean civil servants had been laid off as part of economic reforms dictated by the International Monetary Fund, while foreign workers were holding jobs that could be done just as well by Sierra Leoneans. "Those employees who have unexpired work permits are reminded in no uncertain terms that their work permit applications will not be renewed and they will have to leave the country immediately," he said. Sierra Leone's economy has been devastated by a five-year civil war and unemployment is high. The civilian government which took office in April after four years of army rule has vowed to crack down on corruption and other abuses. Under the new rules, foreigners will have to apply for work permits from their home country and applications will no longer be accepted from foreigners already in Sierra Leone. Announcing the new measures at a news conference on Monday, Gassama said they would affect particularly traders and workers in the building and fishing industries. He said foreigners without work permits should leave the West African country at once or face legal action, and warned aid organisations employing foreigners in non-essential posts not covered by technical agreements with his ministry to terminate their contracts within three months. Angola, which is recovering from a far longer and more devastating civil war, has expelled hundreds of West Africans in recent weeks in a crackdown on illegal traders. 3815 !GCAT !GPOL Angola's former rebel movement Unita accepted on Tuesday an offered vice-presidency in a government of national unity but said that its leader Jonas Savimbi would not occupy the post, Portuguese media reported. The decision came in a communique issued at the end of a week-long party congress called to debate the vice-presidency issue, TSF radio reported from the central Angolan town of Bailundo where Unita has its headquarters. The vice-presidency, one of two in the proposed government, was offered to Unita by President Jose Eduardo Dos Santos after he and Savimbi signed a peace accord in 1994 intended to put a final end to years of bitter civil war. Unita officials had indicated that the congress would probably reject the offer to Savimbi, whose movement should also supply ministers for the new government. The Portuguese news agency Lusa said that the congress ruled that Unita needed Savimbi to continue at its head and dismissed any notion of him combining the leadership with the vice-presidency of Angola. "With the transformation of Unita into a political party...it needs more than ever to have its president at its head," Lusa quoted the communique as saying. TSF said that the congress suggested that chief constitutional negotiator Abel Chivukuvuku or vice-president Antonio Tembo take the job. Unita and the Dos Santos' former Marxist MPLA fought for nearly two decades following Angola's independence from Portugal in 1975. The two sides signed a peace pact in November 1994 and agreed to integrate their armies into a single national military force and proposed to form a unity government. But implementation of the deal has been slowed by lingering suspicion. About 6,500 United Nations troops, costing over $1 million a day, have been helping to implement the plan, especially the disarming of UNITA's fighters at assembly camps. 3816 !GCAT !GDIP !GPOL Angola on Tuesday expelled 162 Senegalese as part of a crackdown on foreign traders, three days after a French plane brought back 13 Senegalese deportees from Paris, officials said. Witnesses said the deportees from Angola, who included six women and five children, arrived at Dakar airport in an Angolan Tupolev plane. Officials said 37 other Senegalese were in detention in Luanda waiting to be sent home. Senegalese traders are found all over Africa and in Europe and North America. Thirteen Senegalese were among more than 50 illegal immigrants deported from France at the weekend, and scores more are expected to be affected by tougher rules for migrant workers announced by Sierra Leone on Monday. Angola has thrown out hundreds of West Africans, Lebanese and Indians since the start two weeks ago of a campaign against foreign traders. A group of 86 Senegalese was expelled from Luanda last week. President Abdou Diouf sent his minister of state at the presidency, Abdoulaye Wade, to intercede with the Angolan authorities. Wade said on Thursday the Angolans had agreed to stop indiscriminate expulsions and send home only those who were there illegally, but most of those who arrived on Tuesday said they had valid documents. Mouhamed Keita, 24, said he had been a trader in Luanda's Hojiyenda district since 1993. "I had a residence permit issued by the administration. One day some policemen came to my shop and took me to prison. We were about 100 in a small cell. We stood there in stinking water for several nights. Many people lost consciousness. We had no access to medical assistance," Keita said. "We lost everything. I will never go back to Angola again." 3817 !GCAT !GPOL !GVOTE Congo's President Pascal Lissouba on Tuesday named Prime Minister Jacques Joachim Yhombi-Opango as head of his Presidential Movement and his campaign manager for elections next year, state radio said. Yhombi-Opango presented the resignation of his government to Lissouba on Friday and a cabinet reshuffle was expected to follow. Presidential elections are due by next August. "The head of state has just confirmed to me that I won the first battle by obtaining an Enhanced Structural Adjustment Facility from the International Monetary Fund and the time has come for me to go on to something else," he told the radio. Oil-producing but impoverished Congo signed a three-year programme with the IMF in June. The Paris Club of official creditors agreed in July to write off two-thirds of the Central African country's external debt. The Presidential Movement comprises Lissouba's Pan-African Union for Social Democracy (UPADS) and allied parties. Yhombi-Opango heads his own party, the Rally for Development and Democracy, which is close to the Presidential Movement. 3818 !E51 !E512 !ECAT !GCAT !GDIP Burundi's new Tutsi military leader denied on Tuesday asking for a regional summit and aid agencies said they were sharing dwindling fuel stocks to survive sanctions. "There was no formal request by Pierre Buyoya to meet leaders of the region," said Jean-Luc Ndizeye, spokesman for the military ruler who seized power in a coup by the Tutsi-dominated army on July 25. "There was some kind of request to talk to the (regional) leaders but there was no formal request," Ndizeye told Reuters. Buyoya told reporters on his return from talks with Julius Nyerere, the international mediator on Burundi, on Sunday that he had asked for a summit to improve understanding between the sides. Nyerere's aides and officials in regional capitals said on Tuesday there was no sign a Burundi summit was being planned. Former Tanzanian president Nyerere was due to arrive in Rome on Tuesday night amid speculation that a Roman Catholic group was willing to sponsor talks to promote peace in Burundi. More than 150,000 people have been killed in three years of massacres and civil war between the army and rebels which leaders fear could turn into mass slaughter on a scale similar to neighbouring Rwanda's 1994 genocide of up to a million. Wide-scale civil war could break out in Burundi and spread to neighbouring states if Buyoya failed to open talks with his opponents, Nyerere was quoted by the French daily Le Monde on Tuesday as saying. Regional leaders imposed sanctions on landlocked Burundi on July 31, demanding a return to constitutional rule and peace negotiations between Hutu rebels and the Tutsi-dominated army. U.N. agencies on Tuesday said they had started to share fuel and pool resources to survive the embargo, compounded since Saturday when rebels cut the main power lines to the capital. The U.N. World Food Programme (WFP) on Tuesday started sending fuel to other other U.N. agencies to keep them working. "None of the U.N. agencies have much stock and by the end of the week it will only be WFP and UNHCR (the U.N. refugee agency) who have fuel. My view is we share stocks just to postpone the problem," WFP's acting director Benoit Thiry told Reuters. Aid agencies in Burundi usually require about 180,000 litres (40,000 gallons) of fuel per month, but U.N. agencies, by far the largest organisations, have only 25,000 litres, Thiry said. A regional sanctions committee meets on Saturday in Nairobi and agencies are lobbying so more humanitarian supplies are exempted from the embargo. The army on Tuesday accused Hutu rebels of attacking three districts just outside Bujumbura to steal food and cattle. "We don't know exactly how many people were killed, but it was quite a serious attack and security forces intervened swiftly," said army spokesman Lieutenant-Colonel Longin Minani. Artillery fire was audible in the lakeside capital this weekend from a campaign launched by the military in rural Bujumbura to drive out rebels from hills close to the city. The director of Burundi's electricity supply company said on Tuesday power to the capital should be restored by Wednesday. But the military-appointed government is already rationing petrol and fuel and long lines of vehicles are a common sight. "They say we have a blockade to return Burundi to democracy, but at least since the coup we have hope," said a waiting motorist, reflecting a defiant mood in the largely Tutsi city. 3819 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Gold Fields Namibia Ltd said on Tuesday operations at three of its mines near Tsumeb remained at a standstill due to strike action by the Mineworkers' Union of Namibia. Strikers last Friday took control of certain key areas of Gold Fields' subsidiary Tsumeb Corp Ltd (TCL), including the copper smelter and Kombat property. Company spokesman Dermot Whyte said the situation at Tsumeb remained the same on Tuesday. "Things are calm, we still don't have control of our operations," Whyte told Reuters. He said there was no production at TCL, which sold 6,789 tonnes of copper in the quarter to end-June. "We have not gone back into any form of negotiations with the union. The (copper) smelter is still shut down, it is now day six," he added. Whyte said the lead smelter at TCL had also been shut down. The company sold 12,142 tonnes of lead in the quarter to end-June. Whyte said pumping operations had resumed at the Tsumeb, Kombat and Otjihase operations after strikers interrupted pumping. He said negotiations had reached a stalemate. "We are not prepared to get involved in negotiations again until we've got complete control and that all the terms of the interdict, which we were granted, are being complied with," Whyte said. The company obtained an interim court interdict last Thursday declaring the strike unlawful but Namibian police have found it difficult to enforce the court order. --Marius Bosch, Johannesburg newsroom, +27-11 482 1003 3820 !C24 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Air traffic is flying normally in and out of Zimbabwe despite a week-long strike over pay by civil servants, a local aviation official said on Tuesday. He told Reuters that among airport workers only firefighters had joined the strike and the government had replaced them with military and local municipal firefighters. "It's not the ideal situation but things are still working," he said. "Our national flights, and others operating here, are generally unaffected, as far as a I know. What we have are the usual and normal delays," said the aviation official, who declined to be named. But the air traffic controllers' association warned there was inadequate fire cover at some smaller airports. Planes were flying at their own risk and pilots were being asked to sign indemnity forms being taking off. "Flight safety is still being compromised and this has put us in an uncomfortable position. Most aircraft are flying at their own risk," they said in a statement. The air traffic controllers said they sympathised with the civil servants' strike for wage rises of up to 60 percent, saying they too were pressing for higher salary increases. ---Cris Chinaka, Harare Newsroom: +263-4 72 52 27/8/9. 3821 !GCAT !GCRIM !GPOL South African apartheid killer Eugene de Kock, convicted of five murders on Monday, was found guilty on Tuesday of blowing up a black activist as well as the attempted murder of his former hit-squad boss. Supreme Court Judge Willem van der Merwe said de Kock -- dubbed "Prime Evil" by his colleagues -- tried to kill his predecessor Dirk Coetzee, commander of a ruthless hit-squad unit based near Pretoria, which wiped out opponents of apartheid. After Coetzee, who has claimed responsibility for several political assassinations ordered by apartheid chiefs, sang out in 1989 about the white government's death squads he himself became a target of the unit he had led until 1985. Earlier in the trial a policeman tesitified that de Kock and others sent a package with tapes, headphones and explosives -- first tested on a pig's head -- to an address in Zambia where Coetzee, who had meanwhile joined Nelson Mandela's African National Congress, was supposed to fetch it. But the post office sent the unopened deadly package, marked with ANC lawyer Bheki Mlangeni's return address, to the hit-squad investigator and killed him. "A reasonable man in de Kock's position would have seen it could have ended up in Mlangeni's care. He was negligent," van der Merwe said before convicting the bespectacled ex-colonel of culpable homicide. The most senior servant of white rule to be convicted by a court, de Kock, was also found guilty of the 1991 murder of police informer Goodwill Sikhakhane, who was shot in the head. "I am satisfied the accused gave the order to murder," van der Merwe said. The judge further convicted de Kock of conspiring to murder, defeating the ends of justice, eight fraud charges and the illegal possession of weapons. Van der Merwe was expected to complete his judgement on Tuesday afternoon. On Monday de Kock was found guilty of planning and executing the ambush and murder of five black men, including Winnie Mandela's driver. The 12,000 pages of evidence and 3,000 exhibits compiled over nearly two years for his trial have provided a litany of the death and mayhem integral to the "old" South Africa. The accusations included massacres and random killings, attacks on township hostels and trains, car bombings, torture, beatings and vendettas against fellow police. Chappies Klopper, one of the 92 witnesses -- 30 of whom were de Kock's colleagues -- testified last year the Vlakplaas unit regularly used the "Buddha" method to destroy all evidence of their atrocities. Buddha was Vlakplaas slang for repeatedly blowing up a corpse "until there was nothing left to blow up". De Kock, now 48, started his career as a killing machine 27 years ago as an ordinary policeman before fighting black liberation guerrillas in former white-led Zimbabwe. Back home, he formed a security police unit that tried to thwart the South West African People's Organisation (SWAPO) in its fight for Namibian independence from South Africa and in 1980 he joined the now notorius Vlakplaas unit. By the time he was arrested early in 1994 he had stashed millions of rand (dollars) in offshore banks. South Africa abolished the death penalty in June 1995, and de Kock faces life imprisonment -- commonly 25 years -- on each murder charge. But in return for evidence against his former cohorts, de Kock has applied to the country's Truth and Reconciliation Commission, requesting the amnesty it has the power to grant to those who committed human rights abuses but came clean. 3822 !GCAT !GCRIM !GPOL !GVIO South African apartheid killer Eugene de Kock was found guilty of murder and attempted murder on Tuesday, a day after he was convicted of five other murders. De Kock, 48, a former police colonel who commanded a hit-squad that wiped out opponents of apartheid, is the most senior servant of white rule yet to face justice. 3823 !GCAT !GVIO Faction leader Charles Taylor, the man who launched Liberia's civil war in 1989, has pledged to demobilise 3,000 fighters and disarm 500 others over the next two weeks to speed up the peace process. Taylor, who has his sights set on presidential elections next year, also ordered his supporters to return any vehicles or equipment looted from aid agencies during militia battles in the capital in April and May. "As I said before, for Charles Taylor the war is over and I will lay claims to no territory," he told reporters on Monday shortly before leaving for Europe. He said he would disarm his first battalion of 500 men and demobilise 3,000 other fighters over the next two weeks. U.N. military observers estimate that Taylor has 30,000 fighters in his National Patriotic Front of Liberia. Taylor invited West African ECOMOG peacekeepers and U.N. military observers into areas under his control to document the demobilisation and return of weapons. "ECOMOG will move into these areas without requesting our permission." The peacekeepers are overseeing implementation of the latest Liberia peace accord signed in Nigeria on August 17. It sets a timetable for disarmament by the end of January and elections on May 30, 1997. West African heads of state have threatened sanctions against individual faction leaders to ensure compliance. U.N. Secretary-General Boutros Boutros-Ghali warned Liberians on Monday that the international community could abandon Liberia if the peace deal fell apart again. A ceasefire was supposed to come into force on August 20. Rival factions have spoken of breaches in the west and south east. Peacekeepers say they have no independent confirmation. Freed American slaves founded Liberia in 1847. The war has killed well over 150,000 people. Hundreds more died during clashes in Monrovia in April and May between ethnic Krahn fighters and supporters of Taylor and Alhaji Kromah, his fellow vice-chairman on the ruling State Council. "I know some people have no chances of winning elections, so they might want to draw me into another mess so that Charles Taylor can be disqualified to run for elections," Taylor said, adding: "I'm not going to let it happen." 3824 !GCAT !GDEF Gambia's military leader Captain Yahya Jammeh has signed decrees creating a navy and a national guard, an official statement said on Tuesday. It said the new forces would replace the army's marine unit and the former national gendarmerie which merged with the army after Jammeh's 1994 coup. The London-based International Institute for Strategic Studies says the 800-strong Gambia National Army has a marine unit strength of about 70, with four inshore patrol boats. The army of the small West African country of just over one million people was trained by Nigerian military advisors until Jammeh sent them home after the coup. 3825 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL Thousands of sacked Zimbabwean civil servants pressed their demands for higher pay on Tuesday, but President Robert Mugabe's government -- facing mounting political and economic costs over their strike -- vowed it would not compromise. The strikers, including doctors, nurses, mortuary attendants, magistrates and firefighters, were on the streets for the seventh consecutive day. The government said it would ignore them. Dominant state media, apart from the official news agency ZIANA, imposed a news blackout on the crisis, except for government statements. The work stoppage has left key social services barely functioning. Public Service Minister Florence Chitauro told state media on Tuesday the striking workers were dismissed for defying orders to return to work last Friday, and the government was now hiring new civil servants. "That is the position and there will be no change. I fully briefed His Excellency (Mugabe) and he fully endorsed cabinet's decision to fire those who did not return to work," she said. Public Service Association (PSA) officials estimate that 70 to 80 percent of the 180,000 civil servants are on the streets. The strikers are challenging the government dismissals and demanding salary increases of between 30 and 60 percent. The government says it has no money and has restricted pay rises for civil servants to a maximum nine percent, which they rejected as unacceptable. Thousands of the dismissed workers milled in a Harare city park on Tuesday, but the large numbers of armed police who were keeping an eye on them on Monday had thinned out. Their strike has paralysed many essential social services, including hospitals where the government is currently relying on army and Red Cross medical personnel to help senior doctors attending to emergencies only. Air traffic controllers have warned the public that although some airports, including Harare International, have drafted the services of military and city council firefighters, "the situation still compromises safety". Independent economists, including consultant John Robertson, said the economic costs of the strike were rising as tax and customs duty collection fell behind. The government said the cost of sub-contracting jobs to the private sector would take weeks to calculate. Politically, the costs include growing divisions in Mugabe's government on how to handle the strike, with more senior officials from his ruling ZANU-PF party privately supporting those who have backed the strikers' demands for decent salaries. The civil servants, who earn an average Z$1,000 (U.S.$99) a month, say their wages have not matched high inflation which has averaged 22 percent in the last two years. The current strike has also renewed public focus on Mugabe, who has been dogged by accusations of economic mismanagement, of being arrogant and sometimes out of touch with the public mood over his 16-year-old rule. Mugabe left incensed civil servants on the streets last week for a honeymoon with his former presidential secretary Grace Marufu, days after a lavish wedding ceremony. On his return, he said he was unaware of the strikers' grievances. 3826 !C42 !CCAT !E41 !ECAT !GCAT !GJOB A wildcat strike by oil industry workers failed to disrupt South Africa's refineries and depots on Tuesday. The one-day strike was called by the Chemical Workers Industrial Union (CWIU) to put pressure on oil companies to meet union demands for a 14 percent pay rise and a 40-hour working week without any loss of pay. Most refineries and depots reported mixed reaction to the strike call and although about 70 workers blockaded the gates to the Caltex refinery in Cape Town, production was not halted. CWIU president Abraham Agulhas told Reuters that workers had barricaded the gates at the Caltex refinery in Cape Town and that most workers at Island View in Durban had joined the strike. The oil industry set up a communications office at the BP headquarters in Cape Town to monitor the strike for the whole industry. Petroleum industry national co-ordinator Simon Drysdale said that about 1,500 of the union's 8,000 members had taken part in the strike but production at the three oil refineries and Sasol had not been affected. Drysdale told Reuters the strike was "illegal and unprocedural" and a "material breach of the interim bargaining agreement signed in June this year by the union's general secretary Muzi Buthelezi". Employers had initially offered a 10 percent wage increase, which would have provided a basic salary of 2,211 rand plus about another 1,000 rand more in fringe benefits. Most oil companies already operate on a 40 hour week and others were prepared to reduce weekly hours. "The offer was rejected and we have now gone down to nine percent or a basic salary of 2,198 rand plus benefits," Drysdale said. The dispute is due to be mediated on Thursday but Agulhas warned of even longer strike action if union demands were not met. He dismissed employer claims that the strike action was illegal, saying "we workers have the right to take action...we were supposed to get our increases in July". -- Cape Town newsroom +27 21 25-2238 3827 !GCAT !GPOL !GVOTE Parliamentary elections scheduled for next month in Niger will have to be postponed but will probably take place before the end of November, Interior Minister Idi Ango Omar said. Ango told state television on Monday night the new parliament would be maintained at 83 deputies as the state could not afford to increase spending. Government sources say they want to give the electoral commission enough time to prepare for the vote and avoid a repetition of chaotic presidential elections last month, where voting had to be extended to a second day because many areas had not received electoral lists and voter cards. The government has promised to revise the lists again before the parliamentary vote. Military leader General Ibrahim Bare Mainassara sacked the independent electoral commission on the second day of voting and appointed a new body which declared him the winner with 52.22 percent of votes cast. His four civilian opponents spent two weeks under house arrest. On Friday, Mainassara named an expanded cabinet under Prime Minister Boukary Adji, replacing the finance and defence ministers and giving the youth and sports portfolio to an army ally from his January coup. The new government has 20 ministers and four secretaries of state, compared to 14 ministers and three secretaries of state in the government named in February. Mainassara told his new ministers on Monday the government's tasks were to complete the return to constitutional rule and pursue economic reforms. "Appointed on the basis of your skills, your different political sensibilities, far from being a handicap for working as a team, should be a source of enrichment," Mainassara said. The national conference which prepared the transition to multi-party rule decided to do without the International Monetary Fund's economic reforms. The former government resumed contacts in 1994 after a break of four years, and the IMF granted an Enhanced Structural Adjustment Facility in June. Mainassara took power in a coup on January 27, ending a paralysing 16-month political standoff between civilian president Mahamane Ousmane and his opponents who held the majority in parliament. 3828 !GCAT !GDIP !GPOL Aid officials said they expected the last Rwandan refugees in Burundi who want to go home voluntarily to do so on Tuesday, ending the biggest repatriation since two million fled two years ago. The officials said they had sent more than 100 trucks to move some 6,000 Rwandans from Rukuramigabo camp in Burundi to a transit centre near the southwestern Rwandan town of Butare. "We have sent down a trucking capacity for over 7,000 people. It's more than 100 trucks," said Simona Opitz, a spokeswoman for International Organisation for Migration (IOM). "We hope to get everyone out from Rukuramigabo today. Most returnees will pass through Musange transit camp before returning to their home communes," she added in the Rwandan capital. Officials of the U.N. refugee agency said they would find out on Tuesday whether any of the last 6,000 refugees at the last Rwandan camp in Burundi refused to go home voluntarily. The biggest Rwandan refugee camp in Burundi was emptied on Thursday except for 223 Hutus who said they did not want to go back to their homeland and were allowed by Burundian authorities to stay. They say they fear arrest or attack if they return home. There were more than 130,000 Rwandan refugees in Burundi at the start of the year. The Hutu refugees leaving Burundi are part of more than two million who fled Rwanda in 1994 during civil war and in fear of reprisal attacks for the genocidal killing of up to one million Tutsis and Hutu moderates by Hutu troops, militiamen and mobs. Refugees began returning in large numbers after Pierre Buyoya and Burundi's Tutsi-dominated army seized power on July 25. They have accused troops of harassing them and three were killed by Burundian soldiers on August 18. Zairean Prime Minister Kengo wa Dondo said last week Zaire and Rwanda had agreed an "organised, massive and unconditional" repatriation of 1.1 million Rwandan refugees in eastern Zaire. He said the repatriation would be "enormous and immediate" and Zaire would close all Rwandan refugee camps on its soil. UNHCR was not consulted in advance about the Zairean-Rwandan agreement, which prompted a Rwandan Hutu refugee lobby group to warn expulsions of refugees from Zaire could start within days. The international community has spent millions of dollars in aid on refugees in Burundi amid constant fears of their being dragged into conflict between Burundian Hutu rebels and the army. The U.N. World Food Programme said on Monday four trucks carrying high protein biscuits, medicine and rice for displaced and refugees in Burundi arrived on Sunday after regional states exempted them from nearly month-old sanctions on the country. Rwandan authorities screen returning refugees and arrest any suspected of involvement in genocide. There are nearly 80,000 prisoners and detainees held in prisons and lockups in Rwanda. 3829 !GCAT These are significant stories in the Ivorian press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. FRATERNITE MATIN - Gasoline imported from the United States may have an unsual smell but it is neither toxic nor harmful to car engines, Ivorian refining company SIR says; SIR, which usually meets all the needs of the Ivorian market from its own refinery, imported the fuel to maintain supplies during maintenance work. - Security forces round up more young men in populous Abidjan districts for identity checks as part of crackdown on violent crime; police shoot dead bandit in Marcory suburb LA VOIE - Cholera kills six people in region of Facobly in western Ivory Coast, health officials say; villagers put the death toll as high as 12. - Mini bus strike over municipal taxes in Ivory Coast's central second city of Bouake ends; transporters agree to pay the taxes LE JOUR - Publication director of Ivorian newspaper Le Populaire, Raphael Lapke, arrested over an article about the public prosecutor; investigators ask for source of a document published by the newspaper as part of the article. -- Abidjan newsroom +225 21 90 90 3830 !GCAT !GDIP !GPOL !GVOTE Gambia's young military leader, Yahya Jammeh, who plans to contest next month's presidential election as a civilian, has launched a new political party, urging the nation to rally round him. Jammeh, aged 31, who ousted elected president Sir Dawda Jawara in 1994 accusing him of corruption, told 40,000 jubilant supporters at a six-hour-long rally late on Monday that he had no interest in politics but had the nation's interest at heart. The Commonwealth of Britain and its former colonies has, however, dismissed rules governing the September 26 election as flawed, saying that they would allow the small West African country's military leaders to strengthen their grip on power. Captain Edward Singateh, vice-chairman of the Armed Forces Provisional Ruling Council (AFPRC), introduced Jammeh to the crowd as leader of the new party -- the Alliance for Patriotic Reorientation and Construction (APRC). "I call all Gambians to work together for the development of the country. I urge them to be on the look out for some hyenas who are still hungry for power and want to ruin the country," Jammeh said, in an address mixing Wolof and Mandinka dialects. "I came to power to set things straight and wipe out the bad deeds of the former regime and the British." Gambia, which won independence from Britain in 1965 is a tiny country of just over a million people surrounded by Senegal. It runs inland from the Atlantic along the river from which it takes its name. It main income comes from groundnuts and tourism. Singateh, who is also defence minister, said Jammeh enjoyed the support of the armed forces. "We urge him to continue the good work he has started," he said. Jammeh paid tribute to France, Canada, Cuba, Taiwan, Egypt, Libya, Mauritania, Senegal, Nigeria and Ghana for their support. He says he does not plan to campaign for the September 26 elections from which the nation's main political leaders and parties have been barred. Local Government Minister Captain Yankuba Touray, a fellow member of the ruling military council, will, however, run a campaign by the new party. Two smaller parties have said they plan to put up candidates provided they can meet tough registration conditions. Prominent Gambian barrister Ousseynou Darboe has said he too plans to form a political party and stand. "I was contacted by a cross-section of the community from Banjul to up country and asked to contest the presidential elections," the vice-chairman of the influential Gambia Bar Association said on Friday. A decree last Wednesday said anyone indulging in politics before campaigning officially starts on September 9 would face a fine of one million dalasis ($102,000) or life imprisonment. Candidates must gather 5,000 signatures from around the country by the September 5 registration deadline. Gambia's military rulers lifted a two-year ban on all political activity on August 14, then announced two days later that the country's three main parties would be excluded. They banned all who served as ministers under Sir Dawda, head of state from independence until 1994, and excluded his People's Progressive Party, the National Convention Party and the Gambia People's Party. Jammeh has said there would be no point in uncovering the corruption of the former government if those responsible were allowed to resume political careers. 3831 !GCAT !GVIO The main rebel group in south Sudan said on Tuesday it was trying to arrange the release of six Roman Catholic missionaries, including three Australian nuns, held for nearly two weeks. George Garang, Nairobi spokesman for the Sudan People's Liberation Army (SPLA), said it was urgently trying to contact SPLA commander Nuour Marial at Mapourdit in the south to free the six. "The movement is making arrangements for them to be set free. This is a decision of the leadership," Garang said. "Commander Nuour Marial is a soldier so he must accept the leadership's decision. But communications at this time of year are very difficult because of rains and a lack of power," he added. The Catholic Information Office in Nairobi said on Monday that four of the six had been charged by the SPLA with spying, spreading Islam and hindering recruitment into the rebel group. "These charges are the interpretation of the church," Garang said on Tuesday. "We have no idea why they are being held. We are still trying to establish contact with the local commander." Asked whether this meant the commander was out of control, Garang said the rebel movement was working on the problem. He said he believed all six were being held in the mission compound at Mapourdit and were reported to be in good health. The Catholic Information office in Nairobi said on Monday that Australian Sisters Moira Lynch, 73, and Mary Batchelor, 68, American Father Michael Barton, 48, and Sudanese Father Raphael Riel, 48, were held in a prison in south Sudan by the SPLA. It said Australian Sister Maureen Carey, 52, and Italian Brother Raniero Iacomella, 28, were held inside the compound. The church in Australia said on Monday Lynch, Batchelor, Barton and Riel were held in a prison until the weekend, when they were moved to join the other captives at the compound. The Catholic Information Office said the SPLA in the Kenyan capital had attributed the detentions of the six to a local commander and had promised they would be freed by August 23. But the church learned in a recent meeting with the local commander that no instructions to release the prisoners were received and they would be held until investigations were completed. It said last Friday they were visited by Monsignor Caesar Mazzolari, apostolic administrator of the diocese of Rumbek in southern Sudan, and an SPLA administrator and appeared in good condition. "On August 17 the mission was surrounded (by the SPLA) and sealed off. The evening of the same day the missionaries were put in prison or isolation. Later the mission was looted," it added. An Australian foreign ministry official said the charges against them were "fairly bizarre" and a matter for concern. He said Australian diplomats in Nairobi were working with the Roman Catholic church in southern Sudan and with U.S. and Italian diplomats in the region to help free the missionaries. The SPLA has fought Khartoum's government forces in the south since 1983 for greater autonomy or independence of the mainly Christian and animist region from the Moslem, Arabised north. 3832 !GCAT These are significant stories in the Nigerian press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. THE GUARDIAN - Commonwealth yet to officially notify Nigeria that this week's proposed visit has been cancelled. - Federal Environmental Protection Agency will begin public hearing on Wednesday into environmental impact assessments for natural gas projects and wood processing factory in eastern Nigeria. THISDAY - Operators of private television stations may have licences withdrawn if they fail to carry enough local broadcasting, the National Broadcasting Commission says. - Divestment of Standard Chartered Bank of London from First Bank of Nigeria was not due to political, economic or monetary policies, a bank spokesman said. - Not less than three billion naira will be required by Federal Airports Authority for installation of instrument landing systems at 17 airports. VANGUARD - Autonomy for the central bank seems to be around the corner with a new decree in the pipeline that would usher in a major reorganisation. ($1=80 naira) --Lagos newsroom +234 1 2630317 3833 !C42 !CCAT !E41 !ECAT !GCAT !GJOB !GPOL !GVIO Thousands of Zimbabwean civil servants, challenging their weekend sacking by President Robert Mugabe's angry government, on Tuesday pressed their demands for higher pay. The strikers, including doctors, nurses, mortuary attendants, magistrates and prosecutors, are estimated by Public Service Association (PSA) union officials at between 70 and 80 percent of Zimbabwe's 180,000 civil servants. They want the government, which says it has no money, to pay them salary rises of between 30 and 60 percent, rejecting as an insult the up to nine percent they were recently awarded. The seven-day old strike has paralysed many essential social services, including hospitals where the government is currently relying on army and Red Cross medical personnel to help senior doctors attending to emergencies only. Public Service, Labour and Social Welfare Minister Florence Chitauro told state media on Tuesday the striking workers were dismissed for defying orders to return to work last Friday, and the government was now hiring new civil servants. Thousands of the dismissed workers milled in a Harare city park on Tuesday, but the large numbers of armed police who were keeping an eye on them on Monday had thinned out. 3834 !E12 !ECAT !GCAT !GPOL South Africa's Reserve Bank Governor Chris Stals said on Tuesday he had a close working relationship with Finance Minister Trevor Manuel. "In the last few months since Trevor Manuel became (minister) I have been in contact with the minister of finance more regularly than I have ever been in contact with a minister of finance in all my experience at the bank," he told reporters. Manuel was appointed earlier this year as South Africa's first finance minister from the ruling African National Congress. 3835 !GCAT These are the leading stories in the Kenyan press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. DAILY NATION - A Kenyan high court judge stops Nairobi Provincial Commissioner Francis Lekolool from demolishing houses belonging to thousands of squatters living in a slum in the city. - Three opposition FORD-Kenya party members of parliament express concern over the recent spate of carjackings in the city, calling it political terrorism. - A high court judge says the Kenya Wildlife Service can now translocate the endangered Hirola antelope "also known as the Hunter's antelope" from Lamu and Tana River areas to the Tsavo National Park, but not from the Arawale Game Reserve in Garissa district in the North Eastern Province of Kenya. EAST AFRICAN STANDARD - Opposition Democratic Party legislator Norman Nyaga urges the electorate to vote out all politicians who have dominated national politics for decades in the next general election. KENYA TIMES - President Daniel arap Moi says imposed experimental democratic ideals were to blame for the many political turmoils in the African continent. 3836 !GCAT !GDIP !GPOL !GVOTE The international community postponed municipal elections in Bosnia on Tuesday, citing voter registration irregularities, but the Bosnian Serbs said they would go ahead and hold them on their territory. "I have made a chairman's decision that it is not feasible to hold municipal elections on September 14," said Robert Frowick, head of the Organisation for Security and Cooperation in Europe (OSCE) mission in Bosnia in charge of the elections. Frowick said voting for cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency would go forward on September 14 as planned. He suggested the municipal elections would probably be held in 1997 and mentioned April or May as possible dates. The OSCE's Provisional Election Commission (PEC) -- its top rule-making body for the elections -- had been wrestling with the issue of what to do about municipal elections for a week. More than 640,000 refugees who registered to vote in 55 countries are scheduled to begin casting absentee ballots on Wednesday, August 28. International election monitors have charged that authorities actively discouraged Bosnian Serb refugees in Serbia from registering to vote from their pre-war homes. The monitors say that the refugees were put under pressure to register to vote from towns which once had Moslem majorities but which are now underpopulated because the Moslems were killed or expelled during the war. Serbian officials denied reports that they had manipulated refugees registering to vote in the Bosnian elections and said international organisers had not reported abuses to them. Bratislava Morina, head of the Serbian commissariat for Refugees, told reporters that the registration of voters had been monitored and approved by OSCE representatives. "We have no evidence that refugees were under pressure to register in the Bosnian Serb republic," she said. Bosnian Serbs, who are eager to cement their rule over the 49 percent of Bosnia they control, reacted angrily to the postponement of the municipal elections and said they would vote for local assemblies on September 14. "The government of the Bosnian Serb republic will, in keeping with a decision by the national assembly, hold full elections, meaning also municipal," Serb deputy prime minister Miroslav Vjestica said. Frowick, speaking on CNN television, responded to news that the Serbs would go it alone, saying: "One would have to question the validity of the Bosnian Serbs holding their own elections." The West supported Frowick's decision but the ruling Bosnian Croat HDZ party objected to the postponement. The head of the HDZ's elections committee in Bosnia, Srecko Vucina, accused Frowick of siding with the Moslem SDA party. "By his decision, Frowick was supporting the SDA's political aims," Vucina said. The president of Bosnia's Moslem-Croat federation, Kresimir Zubak, also criticised the decision. "So what do we get if we postpone the elections? We will have to face the very same problem in two, five or six months," Zubak, a Croat, told Croatian Television. Diplomats say the Serb aim in this electoral engineering is to secure permanent control of strategically important towns inside that 49 per cent of Bosnia known as the Serb republic, consolidating through the ballot box what they seized in war. Such a manoeuvre would turn the Dayton peace process on its head by turning elections into a vehicle for the country's permanent ethnic division rather than its reintegration as a multi-ethnic state. The OSCE decision to postpone municipal elections has direct implications for the 53,000-strong NATO-led peace mission in Bosnia which is supposed to expire on December 20. A significant military presence was already being planned for 1997 but it will now have to be strong enough to provide general security for municipal elections when they are held. NATO sources said their support for OSCE under the Dayton accord would continue until December 20 but they refused to speculate about what might happen after that date. 3837 !GCAT !GPOL !GVIO Russian and Chechen commanders on Tuesday finalised a truce brokered by Alexander Lebed in the rebel region, while President Boris Yeltsin reviewed his aide's blueprint for a political settlement. Interfax news agency quoted Lebed's spokesman as saying that documents outlining a "comprehensive plan" and an account of Lebed's weekend talks with separatist leaders had been passed to Yeltsin. An aide in Lebed's press office earlier said the president, on holiday outside Moscow, would possibly meet his security chief or talk to him by telephone. The Kremlin could not be reached for comment. Yeltsin, 65, who had ordered Lebed earlier this month to restore peace in Chechnya and gave him sweeping but undisclosed powers to carry out the task earlier this month, has not seen him in person for weeks. On Sunday Lebed abruptly broke off talks with rebel commanders and flew to Moscow to get support for his peace plans. But Yeltsin, who had offered his general backing in a late-evening phone call on Friday, has seemed unwilling to meet him. Lebed has disclosed no details of a possible deal to end the 20-month war which had killed tens of thousands of people. But Interfax quoted "well informed sources" as saying that under the plan the decision on the most painful issue of the conflict -- whether Chechnya should become independent as the rebels want or remain part of Russia -- would be put off until the region recovers from the war. Interfax said the plan stated that during the transitional period, which could last up to five years, both sides would prepare for a congress of all Chechen forces which would make a final decision. Interfax said the sides had failed to agree on the issue of whether Chechnya should have an armed force during the transitional period and whether it should report to Moscow or Grozny. Officials would not comment on the Interfax report. Lebed's main achievement so far has been to seal a ceasefire with the separatists. The rebels, under Russian bombardment since the July 3 Russian election, seized most of Grozny on August 6 in a raid designed to turn the tables and embarrass Yeltsin before his August 9 inauguration for a second term. Russian commander Vyacheslav Tikhomirov and Chechen chief-of-staff Aslan Maskhadov said they had ironed out final difficulties on Tuesday and the truce would go ahead. "There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement, which will set up joint Russian-Chechen patrols in Grozny in preparation for the withdrawal of Russian troops by September 1. Agreement had been delayed after a group of Chechens disarmed a Russian column on Saturday, but Tikhomirov said the seizure of the weapons would no longer hold up the talks. Interfax quoted a rebel source as saying that, under the terms of the final agreement, the joint units would be deployed around Grozny around six p.m. (1400 GMT) on Tuesday. Tikhomirov said the pullout of Russian troops from some districts of southern Chechnya, which has continued since Sunday, would be completed on Tuesday. Other districts would be free of Russian troops by Wednesday or Thursday. Both sides said the truce was broadly holding, but the commander of Russia's Interior Ministry forces was sceptical, noting that it was the third ceasefire to have been signed with the rebels. "That which is fixed on paper is not always fulfilled in practice," he told Interfax. Some of the troops lined up in Grozny on trucks and preparing to withdraw took a similar line. "Chechnya is part of Russia. We're moving out of here today, but we'll be back another day," said Dmitry, a 26-year-old from the far northern Kola peninsula, wearing a black and white headband and military fatigues. Yeltsin's slowness in meeting Lebed prompted speculation that the president, who sent troops to crush Chechnya's bid for secession in December 1994, could be too unwell to deal with the matter or that he was waiting to see if Lebed succeeded. "Boris Yeltsin has decided definitively to distance himself from the activities of Alexander Lebed in Chechnya until events there reach a final phase," Sevodnya newspaper said on Tuesday. Yeltsin has been seen twice on television since he was reelected in July, fuelling rumours that two heart attacks last year have weakened his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. 3838 !GCAT !GCRIM Russian police in the Urals city of Perm said on Tuesday they were looking for a serial killer who has claimed his seventh victim in less than three months. The report highlighted the extent to which tales of gruesome deaths have become an everyday part of life here since the end of communist-era censorship. The appearance of yet another serial killer in Russia received no more than a few lines on the Itar-Tass news agency. Perm's police chief Andrei Kamenev was scarcely more forthcoming. "It is true that we are looking for a killer who already killed seven people. His latest victim was a woman who was raped and stabbed in a lift," he said by telephone. Disclosure in the late 1980's that a serial killer was operating around Moscow caused panic. As reports kept coming with ever-increasing frequency, people became used to the idea that serial murderers were a part of life in the former Soviet Union. Some killers' sprees spanned the political changes, taking advantage of chaos in the legal system to avoid capture while spreading their trails of carnage. In the most notorious case, Andrei Chikatilo, dubbed the "Rostov Ripper", murdered and mutilated 53 boys and women in a 12-year rampage through three former Soviet republics. "I am a mistake of nature, a mad beast," he said at his 1994 trial where people fainted as heard how he boiled and ate the sawn-off testicles or nipples of his victims. But it soon became clear that Chikatilo was not quite the exception he claimed to be. During his trial in the southern city of Rosov-on-Don police announced that a second serial killer had struck, committing eight sex-related murders. Anatoly Golovkin, sentenced to death in Moscow the same year, was scarcely less sadistic, deriving pleasure, so prosecutors said, from slitting the bellies of some of his victims -- young boys -- and cutting their testicles. "He is a straightforward maniac," said a spokesman for Moscow district prosecutor's office when Golovkin was sentenced for murdering 11 boys over eight years. "Maniacs have always existed and will always exist, unfortunately," he added. Since then, the maniacs have kept appearing and their crimes have become even more bizarre. Twice last year convicts in Russian prisons were reported to have killed and ate their cellmates, explaining that they were hungry and wanted to relieve overcrowding. Last year police in St Petersburg caught a killer in his kitchen, preparing to cook human flesh. This year police stumbled on a similar scene in the Crimean city of Sebastopol. A man in the Siberian coalmining town of Kemerovo went a step further, admitting he had killed and cut up a friend and used his flesh to stuff pelmeni, a Russian version of ravioli. Psychiatrists differ over the reasons for the serial killer phenomenon. One theory -- that the violence is inherited -- gained weight this year when Chikatilo's son was sentenced for torture, beating and rape. Other specialists cite the culture of violence established by millions of deaths in World War Two and Stalin's purges, and continued since the collapse of communism with a sudden explosion of crime and a string of bloody post-Soviet conflicts. Censorship rules are now much looser than those in the West, and television viewers are fed a daily diet of violence, much of it linked to fighting in Chechnya where a few of the 30,000 victims have had their heads and ears severed. 3839 !GCAT !GPOL !GVIO Russian and Chechen commanders resolved disputes and finalised a truce brokered by Alexander Lebed in the rebel region on Tuesday, while a Lebed aide said President Boris Yeltsin would study further plans. Interfax news agency quoted Lebed's spokesman as saying that documents outlining a "comprehensive plan" and an account of Lebed's weekend talks with separatist leaders had been passed to Yeltsin. An aide in Lebed's press office earlier said the president, on holiday outside Moscow, would possibly meet his security chief or talk to him by telephone. The Kremlin could not be reached for comment. Yeltsin, 65, who had ordered Lebed earlier this month to restore peace in Chechnya and gave him sweeping but undisclosed powers to carry out the task earlier this month, has not seen him in person since then. On Sunday Lebed abruptly broke off talks with rebel commanders and flew to Moscow to get support for his peace plans. But Yeltsin, who had offered his general backing in a late-evening phone call on Friday, seems reluctant to meet him. Lebed has never disclosed details of a possible deal to end the 20-month war which had killed tens of thousands people. But Interfax quoted "well informed sources" as saying that under the plan the decision on the most painful issue of the conflict -- whether Chechnya should become independent as the rebels want or remain part of Russia -- would be put off until the region recovers from the war. Interfax said the plan stated that during the transitional period, which could last up to five years, both sides would prepare for a congress of all Chechen forces which would make a final decision. Interfax said the sides had failed to agree on the issue of whether Chechnya should have an armed force during the transitional period and whether it should report to Moscow or Grozny. Officials would not comment on the Interfax report. Lebed's main achievement so far has been to seal a ceasefire with the separatists. The rebels, under Russian bombardment since the July 3 Russian election, seized most of Grozny on August 6 in a raid designed to turn the tables and embarrass Yeltsin before his August 9 inauguration for a second term. Russian commander Vyacheslav Tikhomirov and Chechen chief-of-staff Aslan Maskhadov said they had ironed out final difficulties on Tuesday and the truce would go ahead. "There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement, which will set up joint Russian-Chechen patrols in Grozny in preparation for the withdrawal of Russian troops by September 1. "We gave each other our word that no provocations would become grounds for a breakdown of negotiations. Somehow in the end we got around to really acting on creating peace." Agreement had been delayed after a group of Chechens disarmed a Russian column on Saturday, but Tikhomirov said the seizure of the weapons would no longer hold up the talks. Interfax news agency quoted a rebel source as saying that, under the terms of the final agreement, the joint units would be deployed around Grozny around six p.m. (1400 GMT) on Tuesday. Tikhomirov said the pullout of Russian troops from some districts of southern Chechnya, which has continued since Sunday, would be completed on Tuesday. Other districts would be free of Russian troops by Wednesday or Thursday. Both sides said the truce was broadly holding. The Russian military said three servicemen were wounded in a total of six shooting incidents overnight, well below "normal" casualties. Yeltsin's slowness in meeting Lebed prompted speculation that the president, who sent troops to crush Chechnya's bid for secession in December 1994, could be too unwell to deal with the matter or that he was waiting to see if Lebed succeeded. "Boris Yeltsin has decided definitively to distance himself from the activities of Alexander Lebed in Chechnya until events there reach a final phase," Sevodnya newspaper said on Tuesday. Yeltsin has been seen twice on television since he was reelected in July, fuelling rumours that two heart attacks last year have weakened his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. 3840 !GCAT !GDIP !GPOL !GVIO !GVOTE The American diplomat in charge of elections in Bosnia on Tuesday postponed municipal polls citing alleged irregularities in Serb voter registrations, but the Serbs said they would go ahead and hold them anyway. "I have made a Chairman's decision that it is not feasible to hold municipal elections on September 14," said Robert Frowick, head of the Organisation for Security and Cooperation in Europe (OSCE) mission in Bosnia. The OSCE is charged with supervising the elections through a mandate provided under the Dayton peace agreement. Frowick said voting for cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency would go forward on September 14 as planned. He mentioned April or May as possible future dates for the rescheduled elections. But the Serbs reacted angrily and said they would ignore Frowick's decision which the separatists' news agency SRNA termed "undemocratic". Serb deputy prime minister Miroslav Vjestica said: "The government of the Bosnian Serb republic will, in keeping with a decision by the national assembly, hold full elections -- meaning also municipal." Bosnian Serb parliament speaker Momilo Krajisnik said he was "very disappointed" by Frowick's decision. "We believed Frowick was doing everything possible for the situation to be normalized and elections to be held at all levels," Krajisnik said. "We are concerned because one side (the Moslems) can influence Frowick into changing an already-made decision." OSCE chairman-in-office, Swiss Foreign Minister Flavio Cotti, suported Frowick's move. "(Cotti)...believes this measure should be able to correct the consequences of the manipulations which have occurred," a statement issued by OSCE headquarters in Vienna said. Frowick's decision has direct implications for the 53,000-strong NATO-led peace mission in Bosnia whose mandate is supposed to expire on December 20. A significant military presence was already being planned for 1997 but will now have to be strong enough to provide general security for municipal elections when they are held. NATO sources said their support for the OSCE under Dayton would continue until December 20 but refused to speculate what might happen beyond that. The OSCE's Provisional Election Commission (PEC) -- its top rule-making body for the elections -- had been wrestling with the issue of what to do about municipal elections for a week. More than 640,000 refugees who registered to vote in 55 countries around the world are scheduled to begin casting absentee ballots on Wednesday, August 28. Frowick said the PEC, which includes Bosnian Moslem, Serb and Croat members, was unable to reach agreement and that he, as its Chairman, had made the final decision. "There was no unanimity so I had to make a Chairman's decision," Frowick told reporters. Even before the Serbs had reacted Frowick said their decision to press ahead with municipal polls was of dubious legality and would further complicate an already fraught political environment. International election monitors have charged that authorities actively discouraged Bosnian Serb refugees in Serbia from registering to vote from their pre-war homes. Instead, monitors report, the refugees were pressured to register to vote in towns which once had Moslem majorities but which are now underpopulated because the Moslems were killed or expelled during the war. Diplomats say the Serb aim in this electoral engineering is to secure permanent control of strategically important towns inside that 49 percent of Bosnia know as the Serb republic, consolidating through the ballot box what they seized in war. Such a manoeuvre would flip the Dayton peace process on its head by turning elections into a vehicle for the country's permanent ethnic division rather than its reintegration as a multi-ethnic state. 3841 !GCAT !GPOL !GVOTE Bosnian Serbs said on Tuesday they will go ahead with municipal elections on September 14 despite a decision by the OSCE to postpone them over alleged irregularities in Serb voter registrations. Serb deputy prime minister Miroslav Vjestica was quoted by the separatists' news agency SRNA as saying: "The government of the Bosnian Serb republic will, in keeping with a decision by the national assembly, hold full elections -- meaning also municipal - as envisaged by the rules of the Organisation for Security and Cooperation in Europe." SRNA termed OSCE ambassador Robert Frowick's decision to postpone the poll as "undemocratic". It said the OSCE's Provisional Election Commission (PEC) -- its top rule-making body for the elections -- had been split 4-3 over whether to defer the municipal ballot. International election monitors have charged that authorities actively pressured Bosnian Serb refugees in Serbia to register to vote from towns which once had Moslem majorities but are now underpopulated because the Moslems were killed or expelled during the war. Frowick, the OSCE head in charge of the elections, said earlier in the day voting for cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency would go forward on September 14 as planned. "The (Bosnian Serb) government has firmly decided to hold integral elections and in this respect has already issued orders to municipal election commissions," SRNA said. 3842 !GCAT !GPOL !GVIO President Boris Yeltsin may soon study details of Alexander Lebed's Chechnya peace plan, but his reluctance to meet his security chief has put both the plan and Yeltsin's overall control of the situation in doubt. Aides to Lebed said Yeltsin, 65, might "possibly" meet Lebed or talk to him by telephone after receiving documents about the peace plan at 5 p.m. (1300 GMT). The Kremlin could not confirm whether a meeting was planned. Security tsar Lebed, Yeltsin's special representative in Chechnya, had interrupted talks with Chechen separatists at the weekend, saying he had to consult the president on proposals for a political settlement in the region. But Yeltsin, who has been on holiday near Moscow since Monday, has not yet agreed to meet the general. "It is obvious that Boris Yeltsin has decided definitively to distance himself from the activities of Alexander Lebed in Chechnya until events there reach a final phase," Sevodnya newspaper wrote on Tuesday. The weekly magazine Itogi, in an article written before Lebed returned to Moscow, cast doubt on whether Yeltsin was fully in charge. "We do not know to what extent the recently reelected Russian president controls the situation in Russia. And if not to the full extent, who does it instead of him?" it asked. Yeltsin, reelected on July 3, has insisted that Chechnya is an integral part of the Russian Federation and his reaction to Lebed's peace initiatives has been confused and contradictory. Yeltsin's vague holiday plans also prompted speculation about the health of the president, who had two heart attacks last year. Russian and Western media said Yeltsin needed an operation on his heart. Yeltsin's press office denied the rumours and, in the event, it was Yeltsin's wife Naina who went into hospital, checking in to Moscow's top clinic for a "planned operation" on a kidney. The Kremlin said on Monday that Yeltsin had been in frequent contact with Naina by telephone and she was expected to be released soon. But the president appeared to have gone on holiday without actually visiting his wife. Kremlin spokesman Sergei Yastrzhembsky has said Yeltsin would remain in control of affairs of state during his vacation at the Rus guesthouse, 100 km (60 miles) from Moscow. "(Yeltsin) controls internal and international policy and daily receives a big packet of documents from Moscow, which demand his intervention. Many of those documents return to the president's administration the same day," he said. Yeltsin was reelected after a gruelling campaign during which he travelled frequently and danced for the crowds and the television cameras. But he disappeared abruptly on June 26 and has looked stiff on his rare appearances since then. Itogi said Yeltsin's televised interview last week had not managed to dispel rumours about his health. "His long absences still give rise to gloomy suspicion," the magazine wrote. 3843 !C33 !C331 !CCAT !GCAT !GDEF Monopolist arms exporter Rosvooruzheniye on Tuesday poured cold water on reports that Taiwan might buy military helicopters from Russia and said such a deal would be a political issue beyond its authority. Taipei's United Evening News daily, quoting unidentified sources, said on Tuesday that the Taiwanese military would send a high-ranking officer to discuss a purchase deal with Russian helicopter makers. It gave no further details. But state-owned Rosvooruzheniye said the firm had received no orders from Taiwan and Moscow would at any rate be wary of deals with Taipei. "The Russian government is wary of striking any deal without observing a balance of interests with China," said spokesman Arkady Pogrebenkov. "Any deals which could affect Russian-Chinese relations are questionable. Even if we had orders for helicopters we would have to apply to the government for an export licence. That would apply to other companies too." Russia does not have formal diplomatic relations with Taiwan but has opened an unofficial trade office in Taipei. China, which has regarded Taiwan as a renegade province after a civil war split them in 1949, strongly objects to military links between the island and foreign countries. The Taiwanese newspaper report said many private companies also showed interests in Russian-made helicopters because of their relatively cheap prices. Taiwan has said it would allow private helicopter passenger and cargo transport on the island by the end of 1996. According to initial proposals, the government plans to grant 15 licences to helicopter firms to allow them to fly between the island's 12 airports. In July, top Russian aircraft maker Aviastar said it would set up a marketing and assembly centre in Taiwan with investment totalling T$2 billion (US$72.6 million). Aviastar would introduce twin-engine Tupolev Tu-204 medium-range passenger jets to Asia and transfer maunfacturing and maintenance technology to Taiwan. 3844 !GCAT !GPOL !GVIO Russian and Chechen commanders resolved disputes and finalised a truce brokered by Alexander Lebed in the rebel region on Tuesday, while a Lebed aide said President Boris Yeltsin would study the plans soon. An aide in Lebed's press office said documents outlining a "comprehensive plan" and an account of Lebed's weekend talks with separatist leaders would be passed to Yeltsin at five p.m. (1300 GMT). She said the president, on holiday outside Moscow, would "possibly" meet his security chief or talk to him by telephone. The Kremlin could not be reached for comment. Yeltsin, 65, named Lebed as his representative in Chechnya earlier this month, but he has seemed reluctant to meet him since Lebed on Sunday abruptly broke off talks with rebel commanders and flew to Moscow to get support for his peace plans. Lebed's peace proposals have not yet been spelled out, but he must try to bridge a chasm between the separatists' demand for a referendum on independence and Moscow's insistence that Chechnya remain part of the Russian Federation. Lebed's main achievement has been the sealing of a ceasefire with separatists. The rebels seized much of the Chechen capital on August 6 in a raid designed to embarrass the Kremlin before Yeltsin's August 9 inauguration for a second term. Russian commander Vyacheslav Tikhomirov and Chechen chief-of-staff Aslan Maskhadov said they had ironed out final difficulties on Tuesday and the truce would go ahead. "There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement, which will set up joint Russian-Chechen patrols in Grozny in preparation for the withdrawal of Russian troops by September 1. "We gave each other our word that no provocations would become grounds for a breakdown of negotiations. "Somehow in the end we got around to really acting on creating peace." Agreement had been delayed after a group of Chechens disarmed a Russian column on Saturday, but Tikhomirov said the seizure of the weapons would no longer hold up the talks. Interfax news agency quoted a rebel source as saying that, under the terms of the final agreement, the joint units would be deployed around Grozny around six p.m. (1400 GMT) on Tuesday. Tikhomirov said the pullout of Russian troops from some districts of southern Chechnya, which has continued since Sunday, would be completed on Tuesday. Other districts would be free of Russian troops by Wednesday or Thursday. Both sides said the truce was broadly holding. The Russian military said three servicemen were wounded in a total of six shooting incidents overnight, well below "normal" casualties. Lebed's peace mission this month has stopped some of the worst fighting of the 20-month conflict. But it could falter if momentum for a final political settlement lapsed. Yeltsin's slowness in meeting Lebed prompted speculation that the president, who sent troops to crush Chechnya's bid for secession in December 1994, could be too unwell to deal with the matter or that he was waiting to see if Lebed failed. "Boris Yeltsin has decided definitively to distance himself from the activities of Alexander Lebed in Chechnya until events there reach a final phase," Sevodnya newspaper said on Tuesday. Yeltsin has been seen twice on television since he was reelected in July, fuelling rumours that two heart attacks last year have weakened his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. In Grozny, the separatists are setting up local government agencies, consolidating their grip to the open dismay of some Russian soldiers who have spent over a year defending the city. Lebed came under fire in Moscow from Doku Zavgayev, the head of the pro-Moscow Chechen government, who accused him of handing power to "terrorists" in his agreements with the Chechen rebels. Zavgayev has largely been sidelined by Lebed's peace mission and his popular support in Chechnya is uncertain. The general's spokesman dismissed Zavgayev's accusations as "lies". 3845 !GCAT !GDIP !GPOL !GVOTE The U.S. diplomat in charge of elections in Bosnia announced on Tuesday that voting for municipal assemblies would be postponed because of irregularities by the Serbs in registering voters. Ambassador Robert Frowick, representing the Organisation for Security and Cooperation in Europe (OSCE), told reporters that municipal polls due on September 14 with other Bosnian elections would be put off. "I have made a chairman's decision that it is not feasible to hold municipal elections on September 14," said Frowick. He said no exact date had been set but it was possible the local elections would take place in the spring of 1997. According to OSCE officials, Serb authorities have pressed their refugees to register to vote in towns now under Serb control, but which used to have Moslem majorities. Human rights workers say authorities in Serbia and Bosnian Serb territory have conducted a well-organised campaign to coerce refugees into registering only on Serb territory and failed to inform them of their rights under the Dayton peace agreement. Diplomats say the effect of the electoral engineering would be to establish political control over districts they conquered and ethnically cleansed in war. The response of the Bosnian Serbs to the OSCE's announcement was not immediately clear. But Bosnian Serb leaders have hinted they would boycott the poll if the municipal elections were postponed, or go ahead with their own. The Bosnian Serb cabinet, in a letter to the OSCE, said on Monday that any delay of local elections would be "a direct and flagrant violation fo the Dayton agreement". The Serbs, who administer half of Bosnia in a Serb republic, said they had met all conditions for holding the September elections. Diplomats fear that the crisis could cast doubt over the entire election process, which already appears set to confirm Bosnia's ethnic partition rather than its reintegration as the Dayton peace agreement had planned. 3846 !GCAT !GPOL !GVIO Russian and Chechen commanders on Tuesday finalised a truce brokered by Kremlin envoy Alexander Lebed, settling disputes that had held up moves to separate the warring sides and monitor the ceasefire. But Lebed's quest for a lasting political settlement for the region appeared to be stalled after President Boris Yeltsin, starting a holiday near Moscow, ignored his calls for a meeting. The Russian army commander in Chechnya, General Vyacheslav Tikhomirov, and rebel chief-of-staff Aslan Maskhadov signed the final ceasefire document in the rebel-held village of Novye Atagi, some 20 kms (12 miles) from the Chechen capital, Grozny. Agreement was delayed after a group of Chechens disarmed a Russian column on Saturday. Tikhomirov told reporters that the seizure of the weapons would no longer hold up the talks. "There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement. "We gave each other our word that no provocations would become grounds for a breakdown of negotiations," Maskhadov said. "Somehow in the end we got around to really acting on creating peace," he added. Progress in Chechnya was not mirrored in Moscow where Lebed was still waiting to see Yeltsin, who appointed the former general as his special envoy to the region two weeks ago. After arranging the preliminary ceasefire last week, Lebed abruptly broke off his mission to the rebel republic on Sunday, saying he would return to Moscow and seek Yeltsin's support for a package of political offers and clarify their legal aspects. The Kremlin press service said Yeltsin, who left for a state holiday home near Moscow on Monday, would hold no working meetings on Tuesday -- an apparent snub to the security chief. Lebed's spokesman had said on Monday the Kremlin security chief might meet Yeltsin on Tuesday, although Yeltsin's spokesman said Lebed's office had not asked for an interview. The slowness in meeting Lebed prompted speculation that the president, who sent troops to crush Chechnya's bid for secession in December 1994, could be too unwell to deal with the matter. Yeltsin, 65, has kept a low profile since he was re-elected in July, fuelling rumours that the two heart attacks he suffered last year could have weakened his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. Some commentators said the president's back-seat approach may be less due to his health than the result of reluctance to put his name to a peace process which might fall apart. "Boris Yeltsin has decided definitively to distance himself from the activities of Alexander Lebed in Chechnya until events there reach a final phase," Sevodnya newspaper said on Tuesday. Tikhomirov said the finalisation of the truce meant that the withdrawal of Russian troops from Grozny would resume on Wednesday and be completed by September 1. He said a system of joint Russian and Chechen patrols would start over the next four days in Grozny, much of which was seized by the Chechens in new attacks on August 6. Interfax news agency quoted a rebel source as saying that, under the terms of the final agreement, the joint units would be deployed around Grozny around 6 p.m. (1400 GMT) on Tuesday. Tikhomirov said the pullout of Russian troops from some districts of southern Chechnya, which has continued since Sunday, would be completed on Tuesday. Other districts would be free of Russian troops by Wednesday or Thursday. Lebed's peace mission this month has stopped some of the worst fighting of the 20-month conflict. But it could falter if momentum for a final political settlement lapsed. Three Russian servicemen were wounded in a total of six shooting incidents overnight, the Russian military said. In Grozny, the separatists are setting up local government agencies, consolidating their grip to the open dismay of some Russian soldiers who have spent over a year defending the city. Lebed's peace proposals have not yet been spelled out but are expected to involve a compromise between the separatists' demand for a referendum on independence and Moscow's insistence that Chechnya remain part of the Russian Federation. 3847 !GCAT Here are highlights from Polish newspapers this morning. RZECZPOSPOLITA - According to a survey by the PBS polling institute, 40 percent of Poles are in the dark about the consequences of the coming central government administration reform. - Poland's sugar production may exceed 2.1 million tonnes, a record level for many years, due to very good beet harvests this year, sugar farming and production sector representatives say; Central Statistical Office (GUS ) forecasts are much less optimistic and envisage harvests at last year's levels. - Inflation may reach the 17 percent level envisaged by the finance ministry if rising prices of meat, fats, central heating, hot water and medication are stemmed, Planning Minister Mieczyslaw Pietrewicz said. - A new bridge on the Vistula river came into operation in Pulawy, Lublin province, last week. A $2.4 million World Bank loan covered 50 percent of the construction costs. - The opposition Union for Freedom (UW) plans to propose a no-confidence vote in Health Minister Jacek Zochowski, alleging corruption and fraud in the ministry which has been confirmed by Supreme Auditing Council (NIK) reports, UW deputy Marek Balicki said. NOWA EUROPA - The finance ministry wants to sell T-bills worth 3.15 million zlotys in September. - Poznan-based Wielkopolski Bank Kredtytowy (WBK) is considering a friendly takeover of a controlling stake in the Polish-American Mortgage Bank PABH, WBK board president Jacek Ksen said. - Shareholders of the Mostostal Zabrze Holding SA construction firm have approved a 25 million zloty, five year convertible bonds issue with a par value of 100 zlotys each, Mostostal representatives said. - Poland's money market remained overliquid despite Monday's National Bank of Poland's (NBP) 2.15 million zlots one-day reverse repo, at which the central bank slashed its maximum accepted rate from its last drainage. GAZETA WYBORCZA - Poland's construction inspector-general Andrzej Dobrucki wants to create a service to police the sector and is seeking one million zlotys to fund pay for construction site inspectors. The Prime Minister will decide on this soon. - Zachodni National Investment Fund (NFI) will sell one department of Wroclaw-based Pilmet agricultural machinery maker to the Danish firm Danfoss. The contract will be signed on September 30, 1996. The value of the contract is not known. - From mid-November last year to yesterday 17.059 million NFI certificates were collected in Poland's privatisation programme. - Poland's gross national product (GNP) will grow by six percent this year, according to KERM and KSERM, the cabinet bodies grouping economic ministers. ZYCIE WARSZAWY - In September or October this year the central bank will cut interest rates on credits for the second time this year which will decrease the profitability of T-bills, Bank Handlowy Capital Operations Centre said in a report. - The joint venture linking Poland's Universal foreign trade company and Hyundai Corporation of South Korea has started passenger car production one day before the government introduced regulations limiting imports of car parts. - According to some estimates, Poland's Baltic coast summer holiday tourism agencies saw a 10 percent sales slump this year compared with 1995, due to rain in July and exaggerated prices compared with some offers in southern Europe. PARKIET - Shareholders of Kielce-based listed construction firm Exbud SA have registered for 729,613 shares, representing 36.5 percent of its two million share rights issue, Exbud representatives said. - Poland's privatisation ministry is ready to annul a tender for Wroclaw-based rolling stock maker Pafawag if Adtranz, a joint venture linking ABB and Daimler Benz AG, does not carry through its purchase offer by the end of August. -- Warsaw Newsroom +48 22 653 9700 3848 !GCAT These are some of the main stories in Sofia newspapers today. Reuters has not verified these stories and does not vouch for their accuracy. 24 CHASA -- The head of visiting International Monetary Fund's mission Anne McGuirk is expected to hold talks on Thursday with the chairman of the State Savings Bank, Bulgaria's second largest credit institution. -- Bulgaria's private industrial output rose by a real 11 percent year-on-year in July, National Statistics Institute data showed. -- The president of the Life Choice International get-rich-quick fund Michael Kapustin is expected to be extradited from Germany on Bulgaria's request at the end of the week and not today as planned due to health problems, the National Investigation Service said. -- Some 82 privatisation funds have raised the minimum required captial of 70 million levs in privatisation vouchers, preliminary Mass Privatisation Centre figures showed. -- Bulgaria's National Electricity Company needs some $9 million a month to import the contracted 200,000 tonnes of coal for the Varna thermal power station, company officials said. KONTINENT -- Bulgaria's National Television decided to ban tobacco commercials from the screen and introduced tough requirements for alcohol advertisements. -- Closures of debt-ridden state firms in Bulgaria should have been done five years ago, according to the IMF mission's head Anne McGuirk. -- Bulgaria's state industrial output fell by a real one percent year-on-year in July , the National Statistics Institute said. PARI -- Bulgaria's state breweries might face bankruptcy due to the low barley harvest and the sharp dollar rise on the local forex market, a state brewery official said. -- Bulgaria's air traffic controllers decided to go on strike from September 3 after the Transport Ministry failed to meet their demands for a $1,000 monthly salary, the strike committee chairman Stefan Raichev said. STANDART -- Bulgaria's Supreme Court revoked the convictions of 51 political leaders, among them three regents, tried by the Communist court in 1945. -- Sofia Newsroom, (++359-2) 981 8569 3849 !GCAT DELO - Slovenia has already fulfilled all conditions for NATO membership but the decision on NATO enlargement will only be taken next year, said U.S. NATO representative Robert Hunter when visiting Slovenia on Monday. - Slovenia's electricity producer and distributor said it has managed to overcome an electricity deficit by repairing the power plant Sostanj. - Parliament is expected to take a vote on the replacement of state prosecutor Anton Drobnic in September. The vote was initialled by the United List of Social Democrats, who claimed that the prosecutor's work was politically biassed. - Health resorts Rogla and Zrece are Slovenia's most popular holiday destinations, Delo's opinion poll showed. - Five candidates have applied for the post of general director of national radio and television station RTV. Former director Zarko Petan retired this year. - Most shop owners said shop opening times should be regulated more strictly in order to prevent independent shops being open throughout weekends and nights. DNEVNIK - Slovenia's Supreme Court is soon expected to reach a decision on the appeal of the owners of bank Komercialna banka Triglav (KBT), who say the bank should not be liquidated. The Bank of Slovenia pushed for liquidation of KBT in July due to its liquidity problems. - State-owned highway company DARS said it faced many problems negotiating the buy-outs of land on planned highway routes. REPUBLIKA - Local communities in Slovenia push for higher autonomy. 3850 !GCAT SME - The paper says the state privatisation agency, the National Property Fund, is expected to approve the privatisation of another 40 companies on its Tuesday's session. - Convicted Belgian rapist Marc Dutroux is suspected of having raped at least one young Slovak girl during his visits to Slovakia. The girl has been missing ever since. NARODNA OBRODA - The Confederation of Trade Unions (KOZ) demands an increase of wages by some 15 percent. The government said such an increase is not probable this year. - The government holds its regular session on Tuesday. The preliminary agenda includes an analysis of causes of the worsnening trade balance. - The government should also discuss changes to the current procedures of releasing of economic and financial information according to the International Monetary Fund standards. PRAVDA - Some 1,985 illegal imigrants were caught attempting to cross Slovakia's borders in the first six months of the year. Most of the imigrants were on their way to Germany. HOSPODARSKE NOVINY - Heavy engineering company ZTS TEES Martin launches production of construction mechanisms under licence from Komatsu-Hanomag. -- Bratislava Newsroom, 42-7-210-3687 3851 !GCAT !GPOL !GVIO Russian and rebel military commanders finally met in Chechnya on Tuesday for delayed talks aimed at finalising a ceasefire arranged last week by President Boris Yeltsin's envoy Alexander Lebed. The Russian army commander in the region, General Vyacheslav Tikhomirov, arrived at the rebel-held village of Novye Atagi, some 20 km (12 miles) south of the Chechen capital Grozny for discussions with rebel chief-of-staff Aslan Maskhadov. But Lebed himself, the Kremlin security chief, is still waiting back in Moscow to meet Yeltsin over his plans for a lasting political settlement in Chechnya. Itar-Tass news agency quoted the Kremlin press service as saying Yeltsin, who left for a state holiday home near Moscow on Monday, would hold no working meetings on Tuesday. Lebed interrupted talks with Chechnya's separatists on a political deal on Sunday, saying he had to consult with Yeltsin. After a meeting failed to materialise on Monday, Lebed's spokesman said he might meet the president on Tuesday. But Yeltsin's spokesman rebuffed the suggestion, saying the president had left Moscow for a holiday near the capital. The Russians postponed the talks after a Chechen band disarmed a column of interior ministry troops on Sunday. The Chechens said a renegade group seized the weapons and said on Monday they had all been returned. The Russian command insisted that not all the weapons were the same as those taken. Tass said the weapons and the practical implementation of the ceasefire signed by Lebed and Maskhadov last Thursday would be on the agenda of today's talks. Neither spoke to reporters before the meeting, which started around 10.45 a.m. (0645 GMT). Also in Novye Atagi on Tuesday morning, was Tim Guldimann, the Swiss diplomat who heads the Chechnya mission of the Organisation for Security and Cooperation in Europe (OSCE). Guldimann, who helped broker an earlier truce in May, was not taking part in the Tikhomirov-Maskhadov talks. Lebed's peace mission this month has stopped some of the worst fighting of the 20-month-old conflict. However, tension on the ground indicates that it could falter if the momentum for a settlement is not maintained. Three Russian servicemen were wounded in a total of six shooting incidents overnight, Itar-Tass news agency quoted the Russian military as saying on Tuesday morning. RIA news agency quoted an army source accusing rebel fighters of failing to turn up for joint Russian-Chechen police patrols in some districts of the capital Grozny on Tuesday. But the separatist command told Interfax news agency the patrols, part of the truce brokered by Lebed last week, would begin on Tuesday after delays for "technical reasons". Yeltsin's spokesman said he might meet officials during his break, but indicated Lebed was low on the list by saying Yeltsin would need time to study the proposals before talking to him. Russian news agencies also quoted the Kremlin spokesman as saying that Lebed's representatives had not sought a meeting, hinting at an attempt by the president to put his popular and outspoken protege in his place with a lesson on protocol. Yeltsin, 65, has kept a low profile since he was reelected in July, prompting new speculation that the two heart attacks he suffered last year and a rumoured drinking problem could be taking their toll, weakening his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. Some analysts say the Kremlin leader, whose order sending troops and tanks into Chechnya in 1994 started Russia's ill-fated military campaign, could merely be reluctant to put his name to a peace process which might fall apart. But Lebed, who has no real power without his boss and has hinted at dark forces in Moscow working against him, appears to think a deal will not stick without strong backing from Yeltsin. His proposals have not been spelled out but are expected to involve a compromise between the separatists' demand for independence and Moscow's insistence that Chechnya remain part of the Russian Federation. 3852 !GCAT !GPOL !GVIO Russian Security chief Alexander Lebed tried to consolidate a fragile peace in Chechnya, but President Boris Yeltsin has so far kept his distance, withholding the backing Lebed says he needs. The former paratroop general, who was in Moscow on Tuesday, had interrupted talks with Chechnya's separatists on a political settlement on Sunday, saying he had to consult with Yeltsin. After a meeting failed to materialise on Monday, Lebed's spokesman said he might meet the president on Tuesday. But Yeltsin's spokesman rebuffed the suggestion, saying the president had left Moscow for a holiday near the capital. Lebed's peace mission this month has stopped some of the worst fighting of the 20-month-old conflict. However, tension on the ground indicates that it could falter if the momentum for a settlement is not maintained. Three Russian servicemen were wounded in a total of six shooting incidents overnight, Itar-Tass news agency quoted the Russian military as saying on Tuesday morning. RIA news agency quoted an army source accusing rebel fighters of failing to turn up for joint Russian-Chechen police patrols in some districts of the capital Grozny on Tuesday. But the separatist command told Interfax news agency the patrols, part of the truce brokered by Lebed last week, would begin on Tuesday after delays for "technical reasons". Yeltsin's spokesman said he might meet officials during his break, but indicated Lebed was low on the list by saying Yeltsin would need time to study the proposals before talking to him. Russian news agencies also quoted the Kremlin spokesman as saying that Lebed's representatives had not sought a meeting, hinting at an attempt by the president to put his popular and outspoken protege in his place with a lesson on protocol. Yeltsin, 65, has kept a low profile since he was reelected in July, prompting new speculation that the two heart attacks he suffered last year and a rumoured drinking problem could be taking their toll, weakening his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. Some analysts say the Kremlin leader, whose order sending troops and tanks into Chechnya in 1994 started Russia's ill-fated military campaign, could merely be reluctant to put his name to a peace process which might fall apart. But Lebed, who has no real power without his boss and has hinted at dark forces in Moscow working against him, appears to think a deal will not stick without strong backing from Yeltsin. The rebels said Lebed told them he was returning to Moscow to be sure that the by-now notorious but ever-mysterious "party of war" did not upset a final deal. On Monday Lebed's spokesman Alexander Barkhatov was defensive about the president's apparent reluctance to meet his Chechen envoy at such a delicate moment in the peace process. Interfax quoted him as saying that a postponement of the meeting with Yeltsin would not upset Lebed's plans, which include preparing for new talks with the rebels and seeking legal advice on proposals they discussed on Saturday. The proposals have not been spelt out but are expected to involve a compromise between the separatists' demand for independence and Moscow's insistence that Chechnya remain part of the Russian Federation. While Moscow mulls how to agree a political settlement without appearing to give an inch, progress in fulfilling the military part of the deal has become bogged down in a row over the seizure of Russian arms by a group of Chechens in Grozny. Elsewhere, some Russian troops are showing signs of disatisfaction at finding themselves in a humiliating limbo. Reuters journalist Dmitry Kuznets watched as hundreds of troops headed back to base from the south of the region on Monday, part of the military deal Lebed signed with separatist chief-of-staff Aslan Maskhadov last week. He said the Chechens were very happy about the pullout, but that there was some tension on the Russian side, fuelled by provocative actions by the Chechens such as when a group of them jumped onto tank and had a photograph taken by their comrades. 3853 !GCAT !GVIO Russian troops will restart their withdrawal from the Chechen capital Grozny on Wednesday after Moscow commanders and separatist rebels sorted out a conflict over the seizure of a Russian convoy. In Moscow, peacemaker Alexander Lebed, who struck a military deal with rebel chief-of-staff Aslan Maskhadov last week, is waiting for President Boris Yeltsin to consider his plan to solve political aspects of the 20-month war. Maskhadov and Russia's top commander in Chechnya Vyacheslav Tikhomirov said on Tuesday they had finally agreed on all details of the military deal signed last Thursday. "There will be no more obstacles to the continuation of our task," Tikhomirov told reporters after talks in the village of Novye Atagi, 20 km (12 miles) south of Grozny . The deal, which provides for a truce and Russian withdrawal from Grozny and southern regions of Chechnya, had been delayed after a group of Chechens disarmed a Russian column on Saturday. But Tikhomirov said the seizure of the weapons would no longer block the deal. Tikhomirov said the pullout of Russian troops from some districts of southern Chechnya, which has continued since Sunday, would be completed on Tuesday. Other districts would be free of Russian troops by Wednesday or Thursday. Both sides said the truce was broadly holding. Lebed, whom Yeltsin had ordered to restore peace in Chechnya, followed the military deal with talks aimed at solving political aspects of the conflict in which tens of thousands people died. On Sunday Lebed abruptly broke off talks with rebel commanders and flew to Moscow to get support for his peace plans. But Yeltsin, who had offered his general backing in a phone call on Friday, has seemed unwilling to meet him. Interfax news agency quoted Lebed's spokesman as saying that documents outlining a "comprehensive plan" and an account of Lebed's weekend talks with separatist leaders had been passed to Yeltsin. Lebed's aide said on Tuesday that Yeltsin, on holiday outside Moscow, would possibly meet his security chief or talk to him by telephone. The Kremlin could not be reached for comment. Yeltsin, 65, who has given Lebed sweeping but undisclosed powers in Chechnya, has not seen him in person for weeks. Lebed has disclosed no details of a possible deal to end the 20-month war which had killed tens of thousands of people. But Interfax quoted "well informed sources" as saying that under the plan the decision on the most painful issue of the conflict -- whether Chechnya should become independent as the rebels want or remain part of Russia -- would be put off until the region recovers from the war. Yeltsin's slowness in meeting Lebed has prompted speculation that the president, who sent troops to crush Chechnya's bid for secession in December 1994, could be too unwell to deal with the matter or that he was waiting to see if Lebed succeeded. "Boris Yeltsin has decided definitively to distance himself from the activities of Alexander Lebed in Chechnya until events there reach a final phase," Sevodnya newspaper said on Tuesday. Yeltsin has been seen twice on television since he was reelected in July, fuelling rumours that two heart attacks last year have weakened his grip on affairs of state. Aides have dismissed such speculation, insisting that he simply needs a rest after his energetic election campaign. 3854 !GCAT !GVIO The Russian Interior Ministry troops lined up in seven trucks on a muddy road, happy to be leaving their checkpoints after three weeks of fighting for the Chechen capital. The commandos were preparing on Tuesday to withdraw from this rebellious North Caucasus region, but some had little faith in the durability of the latest peace initiatives and were sure they would return sooner or later. "Chechnya is part of Russia. We're moving out of here today, but we'll be back another day," said Dmitry, a 26-year-old from the far northern Kola peninsula, wearing a black and white headband and military fatigues. These men, mostly contract soldiers, had lived through the fiercest fighting in Chechnya since the winter of 1994-95 when Russian troops stormed Grozny for the first time. Chechen pro-independence fighters turned the tables on Moscow three weeks ago with an offensive that left them in control of much of the city. Hundreds of Russian troops were killed in the battles. Now the Chechen fighters and the Russians are observing a ceasefire and coexisting uneasily, obeying orders. Rival commanders agreed on Tuesday that Russian troop withdrawals from Grozny should resume on Wednesday and joint Russian-Chechen patrols should be established within the next few days. "Yesterday we were killing them. Today we are not. Today is different," said Andrei, another one of the Russian unit preparing to pull out. "We're not sure if we'll be back soon." Andrei, wearing a mustard-coloured headband and with a Kalashnikov slung over his shoulder, was sure he would find another conflict somewhere. "People like me are always necessary," he said. "Tomorrow there will be another Ichkeria," he added, using the rebel name for Chechnya. "It is dirty politics and money that is behind this war, the Russian mafia, money, just money." As he spoke, a group of rebels sped by in an armoured personel carrier captured from the Russians and flying the green flag of Ichkeria. The guerrillas sitting on top cried "Allahu Akbar" (God is Greatest). Next to the Russian column, Ramzan Magomadov, a rebel with a green cloth wrapped around his head Arab-style, sat on a passenger car. In the background flames danced from a damaged gas pipeline and smoke rose up from a burning oil reservoir. "It has been calm for the past couple of days," Magomadov said. "But there have been some provocations from Doku Zavgayev's men," he added, referring to the pro-Moscow Chechen leader. "There are some gangs running around who are loyal to the Moscow puppet. He should stay in Moscow. We don't need him here." Near Zavgayev's former headquarters in Grozny, Russian troops dug out three bodies of comrades slain in the recent fighting. "They are digging out another one now," said a Chechen rebel watching the work. In a courtyard, where the Russians, with cloths covering their noses, wrapped the bodies with foil and put them on stretchers, the Moslem rebels smashed bottles of vodka they had discovered by throwing rocks at them. 3855 !GCAT !GDIP !GPOL !GVOTE Serbian officials on Tuesday denied reports they had manipulated refugees registering to vote in Bosnia elections and said international organisers had not reported abuses to them. Bratislava Morina, head of the Serbian commissariat for Refugees, told reporters the registration of voters had been monitored and approved by representatives of the Organisation for Security and Cooperation in Europe (OSCE). "We have no evidence that refugees were under pressure to register in the Bosnian Serb republic," Morina told a news conference in Belgrade. She spoke a few hours after Robert Frowick, head of the OSCE mission in Bosnia overseeing elections, announced municipal polls would be postponed due to Serb irregularities in voter registration. Human rights workers, U.N. relief officials and OSCE monitors say many refugees in Serbia were not informed of their rights and were told where to register for the September election to solidify Serb control of conquered territory. Ambassador Michael Steiner, the international community's deputy High Representative to Bosnia, accused Belgrade of rampant abuses in remarks to the Bosnian parliament on Tuesday. Steiner said there had been "organised manipulation" with Serb refugee voters "mainly in Yugoslavia," he said. Morina said she regretted Frowick's decision and said her office had yet to be officially informed by the OSCE. Asked how Serbia would respond to the move, she said, "We will obey the rules of the OSCE." OSCE officials attending the news conference contradicted accounts from their counterparts in Sarajevo and Vienna about widespread abuses in the registration process. "I don't think there was manipulation on a large-scale," Antonio Tsakiris, a member of the OSCE team in Serbia. "In my opinion, the reports have been exaggerated." The OSCE had a 30-member staff to supervise the registration of more than 200,000 refugess in rump Yugoslavia, comprised of Serbia and Montenegro. Refugees in 55 countries are due to begin casting absentee ballots on Wednesday. Morina said some 60 polling stations across rump Yugoslavia would open as planned on Wednesday. The Bosnian Serb leadership in Pale, outside Sarajevo, condemned the OSCE's decision and said it would hold local elections on the 49 percent of territory under its control anyway. 3856 !GCAT !GDIP !GPOL !GVIO A U.N. human rights envoy criticised Croatian authorities on Tuesday for failing to provide adequate security for minority Serbs who remained in Croatia after their enclave was recaptured last year. "It is evident that the Croatian authorities are still not providing adequate security to the residents of former Sectors North and South," special envoy Elisabeth Rehn said in a report to the U.N. human rights commision, which was faxed to Reuters. Sectors North and South denote parts of the Serb self-styled Krajina state that defied Croatia's independence until Zagreb troops recaptured it in two swift offensives across U.N. truce lines last year. Up to 200,000 Serbs fled to Serbia and Bosnia. Only a few, most of them elderly, remained in Krajina to live under Croatian rule. Human rights observers have denounced numerous incidents in which Serb homes have been blown up and residents harassed or killed. Rehn, who toured the area three weeks ago, said she had learnt of recurring incidents, which led her to believe Zagreb had failed to take steps to prevent further harassment. "During my mission I learned of numerous recent cases of looting, arson and harassment in the region, in which most of the victims have been Croatian Serbs". "The continuing state of insecurity...leads me to conclude that there apparently is an unwillingness on the part of the Croatian authorities to take strong preventive measures to ensure the safety of local residents," she said. Croatia's bid for acceptance in the Council of Europe, the antechamber to the European Union, was put on indefinite hold in May, in part due to Zagreb's treatment of minority Serbs. Rehn said Croatian authorities were not encouraging the return of the Serbs who fled last August. "Indeed, returns of Croatian Serb refugees have been very low so far," she said. "I learned of numerous cases of Serbs who have attempted to return to their homes and have been unable to gain possession of them because these properties are now occupied by Croatian refugees, mostly from Bosnia. "While the refugees as a group do not deserve blame for this state of affairs, I believe that the Croatian authorities must act firmly to safeguard property rigts in the (Krajina)," Rehn said. Croatia and rump Yugoslavia, comprising Serbia and Montenegro, signed a mutual recognition accord last week which envisaged a safe return of refugees to their homes. 3857 !C12 !CCAT !GCAT !GCRIM Bulgaria will seek the extradition of a Bulgarian businessman arrested in France last week on suspicion of obtaining $10 million by fraud, a prosecutor said on Tuesday. French police detained Ivo Nedialkov, aged 30 and former head of the East West International Holding Group (EWIHG) which collapsed in 1994, in the Riviera resort of Cannes on August 20. Angel Ganev, a top official at the Bulgarian prosecutor's office, told Reuters: "We are now preparing the documents through which we will demand Nedialkov's extradition from the French court. The procedure will take a while, though." Nedialkov, the subject of an international arrest warrant, was involved in a pyramid investment scheme which involved using income from new investors to buy back shares from old investors. Bulgarian investigators have said he misappropriated around 360 million levs ($10 million) under the average exchange rate of that period. Nedialkov disappeared from Bulgaria in December 1994 after the collapse of his firm and arrived in Cannes in early 1996, where he rented a luxury villa. He had previously lived in Britain and Australia. Bulgarian media said he was arrested for owing several months of rent. He faces up to 30 years in prison if he is convicted. Pyramid investment schemes have proved popular in several other ex-communist countries, including Russia and Romania. Another Bulgarian-born businessman, Michael Kapustin, accused of misappropriation of more than $10 million, was due to be extradited from Germany this week, said Ganev. But the extradition had been postponed due to Kapustin's hunger strike and resulting bad health. 3858 !GCAT !GHEA Two teenaged girls have died this month as a result of outbreaks of polio in central and northern Albania, a leading physician said on Tuesday. Kristo Pano, senior doctor at Tirana's hospital for infectious diseases, said one of the girls, aged 15, died on Aug 15 and another, aged 14, five days later. He said they were among 23 cases referred to the capital's specialist hospital since the beginning of June. He denied there was an epidemic. "The cases are completely unrelated," he said. Pano said the disease had originated from children who had received polio vaccinations then passed on the virus in faeces. "It can then enter the water supply and infect people with weak immune systems. The infection occurs because of poor sanitary conditions," he said. About 700,000 Albanian children received polio vaccinations in April and May. 3859 !E51 !E512 !ECAT !G15 !G158 !GCAT !GDIP Slovenia and Poland pledged to intensify cooperation on Tuesday and reinforced their determination to join the European Union and NATO at the earliest possible date. Polish President Aleksander Kwasniewski and his Slovenian counterpart, Milan Kucan, met for talks at the start of a two-day visit to Slovenia by Kwasniewski. It was their fourth meeting this year. They said in a statement they agreed to have regular telephone contact to discuss progress in strengthening ties with the West. "We expect our cooperation will help both countries towards entering the European Union and NATO," Kwasniewski said. "We have similar ambitions as far as our internal development and international life is concerned," Kucan said. Poland and Slovenia are hoping to be among the first group of former eastern bloc countries to join the European Union and NATO. They have already signed an association agreement with the European Union and are both part of the Central European Free Trade Area, which also comprises Hungary, Slovakia and the Czech Republic. Slovenia's trade with Poland rose to $142.3 million in 1995 from $118.8 million in 1994. During his visit to Slovenia, Kwasniewski is also scheduled to meet Prime Minister Janez Drnovsek, representatives of Slovenian political parties and representatives of the Chamber of Economy. 3860 !GCAT !GPOL Moldovan parliamentarians opposed to President Mircea Snegur spurned awards he offered to mark Tuesday's fifth anniversary of independence from the Soviet Union in protest at Snegur's support of ties with Romania. The president offered the Civic Merit medal to all 272 members of the local Soviet-era parliament who adopted the country's declaration of independence on August 27, 1991. But 37 signatories, now members of the majority Agrarian Democratic Party, did not turn up at a solemn ceremony arranged to present the awards. The Agrarians' press service called Snegur's award "populist", drawing an angry response from the president. "We do not want to be decorated together with those, who later launched a fierce fight against Moldova's independence and headed towards unification with Romania," one deputy said. Most of Moldova comprises the former Romanian province of Bessarabia, annexed by Soviet dictator Joseph Stalin under a secret pact with Nazi Germany in 1940. After the collapse of the Soviet Union in late 1991, many Moldovan politicians formed the Unification Council which proclaimed merger with Romania as its main goal. Pro-independence Agrarians and their candidate, Prime Minister Andrei Sangheli, will be the main challenge to Snegur seeking re-election in Moldova's presidential elections due on November 17. Several pro-Romanian parties have said they would back Snegur in the elections, but the president have repeatedly stressed he remains devoted to the country's independence. 3861 !GCAT !GDIP !GPOL !GVIO !GVOTE The American diplomat in charge of elections in Bosnia postponed voting for municipal assemblies on Tuesday, citing alleged irregularities in Serb voter registrations. "I have made a Chairman's decision that it is not feasible to hold municipal elections on September 14," said Robert Frowick, head of the Organisation for Security and Cooperation in Europe (OSCE) mission in Bosnia. The OSCE is charged with supervising the elections through a mandate provided under the Dayton peace agreement. Frowick said voting for cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency would go forward on September 14 as planned. He mentioned April or May as possible future dates for the rescheduled elections. His decision has direct implications for the 53,000-strong NATO-led peace mission in Bosnia whose mandate is supposed to expire on December 20. A significant military presence was already being planned for 1997 but will now have to be strong enough to provide general security for municipal elections when they are held. NATO sources said their support for the OSCE under Dayton would continue until December 20 but refused to speculate about what might happen beyond that. The OSCE's Provisional Election Commission (PEC) -- its top rule-making body for the elections -- had been wrestling with the issue of what to do about municipal elections for a week. More than 640,000 refugees who registered to vote in 55 countries around the world are scheduled to begin casting absentee ballots on Wednesday, August 28. Frowick said the PEC, which includes Bosnian Moslem, Serb and Croat members, was unable to reach agreement and that he, as its Chairman, had made the final decision. "There was no unanimity so I had to make a Chairman's decision," Frowick told reporters. He refused to disclose what divisions there had been within the commission but other OSCE sources said the Serb member was opposed to postponing the municipal level vote while the Moslem member was in favour. Attention will now shift to the Bosnian Serb republic and the reaction of its ruling Serb nationalist SDS party leaders. Some in the SDS have vowed they will hold local elections on their 49 percent of Bosnia regardless of what the OSCE decides, a move Frowick said was of dubious legality and would further complicate an already fraught political environment. International election monitors have charged that authorities actively discouraged Bosnian Serb refugees in Serbia from registering to vote from their pre-war homes. Instead, monitors report, the refugees were pressured to register to vote in towns which once had Moslem majorities but which are now underpopulated because the Moslems were killed or expelled during the war. Diplomats say the Serb aim in this electoral engineering is to secure permanent control of strategically important towns inside that 49 percent of Bosnia know as the Serb republic, consolidating through the ballot box what they seized in war. Such a manoeuvre would flip the Dayton peace process on its head by turning elections into a vehicle for the country's permanent ethnic division rather than its reintegration as a multi-ethnic state. 3862 !GCAT !GPOL !GVOTE Estonia's parliament on Tuesday delivered a slap in the face for incumbent president Lennart Meri when it refused three times to back him in his bid for a second term as head of state for the former Soviet republic. Although the favoured candidate in the two man field, Meri failed three times in two days to secure the required 68 votes from the small Baltic state's 101-member parliament - despite a last minute promise to change his style. The presidential election will now go before a larger, specially formed assembly in the next month or so with Meri and rival candidate Arnold Ruutel automatically qualifying but the field also open to new nominations. Parliamentary support for the charismatic Meri, 67, has waned in recent years, with many MPs accusing him of overstepping his non-executive role since winning the presidency a year after independence in 1991, taking too much power and acting without consulting parliament. "He has only appeared in parliament four times in the past four years. This is king-like behaviour," one of parliament's deputy speakers Tunne Kelam told Reuters. "This election was a warning sign to him." Meri particularly angered MPs in 1994 when he signed an agreement in Moscow for the withdrawal of Soviet troops from Estonia, which left some former Soviet military personnel in the country, without consulting parliament. Meri's drop in popularity was evident in the voting as he only scored 45 votes in the first round on Monday, 49 in the second round on Tuesday morning and finally 52 late Tuesday. Ruutel, 68, parliament's other deputy speaker and a politician in the Soviet era liked for his nationalist tendencies, secured 34 votes in the first two ballots then 32 in the third. Kelam said he himself considered standing in the second ballot, representing his parliamentary party, the Fatherlands Union, but he was dissuaded by Meri at a breakfast meeting on Tuesday when the president promised to change his ways. "Meri agreed to change his style and cooperate with the adoption of a special law to regulate the president's behaviour so we agreed to support him," said Kelam. "He's been fantastic in conducting foreign policy and we could not have had a better president for the times but things have now changed and people fear if he is re-elected noone will be able to stop him for the next five years." The presidential election will now go before an electoral college made up of the 101 MPs and 273 local government representatives with the timeframe to be decided at a meeting on Wednesday. Politicians were hesitant in forecasting the results of the next round in the presidential election, expecting new candidates in the field but Meri, a former writer and documentary film maker, to remain the favourite. "The message has been given that a certain number of MPs consider Lennart Meri to be the most suitable choice for president, with the vote getting more positive, and this is likely to be reflected in the electoral college," MP Mihkel Earnoja told Reuters. If the electoral college fails in two rounds of voting to give a candidate a clear majority, the election will go back into the parliament and start again from stage one. 3863 !GCAT !GDIP !GPOL Junior Nationalist members of Romania's ruling coalition called on Tuesday for the impeachment of President Ion Iliescu for backing a friendship treaty with neighbouring Hungary. Iliescu's Party of Social Democracy, the senior coalition partner, immediately dismissed the National Unity Party (PUNR) demand as crude electioneering. "It is a desperate move by the PUNR, which is losing its only reason for existing ahead of the electoral campaign," said PDSR executive president Adrian Nastase. "This treaty is both necessary and good," Nastase said, adding that the PUNR's stance was threatening its position in the government. The treaty agreed unexpectedly two weeks ago will end years of disputes over the status of Romania's large ethnic Hungarian minority. It will also boost both countries' chances of admission to NATO and the European Union. "If they (the PUNR) are so vexed, they could leave the government...We might also help them to do it, if they go on like this," he said. The PUNR holds four key ministries -- justice, transport, agriculture and communications. PUNR leader Gheorghe Funar said in a statement Iliescu, in power since the fall of communism in 1989, should be impeached for treason for compromising on the issue of ethnic Hungarian minority rights in the treaty due to be signed next month. Funar's call came on the eve of the official launch of Iliescu's campaign for a new term at November 3 polls. His appeal to the opposition to back his attempt to oust Iliescu was unlikely to succeed, analysts said. Iliescu has invited political leaders to a meeting on Thursday to discuss the final form of the pact which both Romanian and Hungarian nationalists oppose for different reasons. Presidential officials were not available to comment on the call for Iliescu's impeachment. 3864 !GCAT !GDEF !GDIP !GPOL !GVIO Polish prosecutors on Tuesday withdrew a wanted notice for Ryszard Kuklinski, an army officer who defected to the United States in 1981 after betraying top Warsaw Pact secrets including plans for martial law in Poland. Kuklinski, now 66 and living under an assumed identity somewhere in the United States, was a senior staff officer in Soviet-dominated Poland when he passed 35,000 pages of secret documents about the Warsaw Pact to U.S. intelligence. When the United States spirited him out of Poland along with his family he handed over secret Polish plans to impose martial law, just weeks before they were set in motion in December 1981 to quell Solidarity, the Soviet bloc's first free trade union. A Polish court in 1984 sentenced Kuklinski to death for treason and desertion though this was commuted after the 1989 fall of communism to 25 years jail. Last year his conviction was overturned but he had still faced the possibility of arrest. "Today the Warsaw region military prosecutors office withdrew the decision on the temporary arrest of Colonel Ryszard Kuklinski and withdrew the wanted notice for him," the office's spokesman Ryszard Pospiech said. "This means that from today Colonel Kuklinski can without anxiety return to this country and present explanations of this matter to the prosecutor," Pospiech added. Pospiech said the prosecutors had now removed the threat of arrest because investigators could not take their probe any further without interviewing Kuklinski in person. Opinions in Poland are sharply divided over Kuklinski. While some former anti-communist campaigners see him as a hero, figures associated with the former communist system, some of whom now lead the ruling leftist coalition, often view him as a traitor who betrayed his military oath for gain. Kuklinski's two sons died in mysterious circumstances in 1993 and 1994, prompting speculation they fell victim to revenge by intelligence officers of former Soviet bloc states. 3865 !GCAT !GVIO Chechen rebels kept a tight grip on Grozny on Tuesday as Russian forces abandoned some positions in the capital and withdrew from mountainous southern regions as part of a peace agreement. The city has been calm for several days since Russian security chief Alexander Lebed stepped up his peace initiatives last week and ended the worst fighting in the breakaway north Caucasus region in 18 months. A fragile truce, which formally took effect on Friday, is holding despite accusations of "provocations" by both sides. In Novye Atagi, some 20 km (12 miles) south of Grozny, Russian commander Vyacheslav Tikhomirov and rebel chief-of-staff Aslan Maskhadov finalised the truce and set the scene for more troop withdrawals and joint Chechen-Russian patrols. But shattered Grozny remains tense and the stench of death hangs in the air around the destroyed headquarters of the pro-Moscow Chechen government. As the rival commanders got down to the task of implementing peace agreements, Russian soldiers under the watchful gaze of bearded Moslem rebels picked through the rubble to collect the remains of their slain comrades. Hundreds of Russian troops were killed in the past three weeks when the guerrillas struck at the heart of Moscow power structures in Chechnya and took control of most areas. "Now everything is calm here and it is stormy in Moscow," Russian human rights activist Andrei Mironov told reporters, referring to the political intrigues and in-fighting in the corridors of the Kremlin over the crisis in Chechnya. In Moscow, Russian President Boris Yeltsin agreed to study Lebed's plans to end the 20-month conflict but it was not clear whether the two men would actually meet. Mironov was in central Grozny where Russian and Chechen forces are in a tense standoff but holding fire for the moment as peace efforts continue. The Russians were towing away destroyed armoured vehicles. The Chechens remain in control of the surrounding area. "We took this territory by storm, then the truce started and we were not able to go any further," said Beslan, a 28-year old rebel fighter who strolled right up to a Russian check point. A Russian officer stopped journalists from going further. "You cannot go beyond this line," he said, pointing to a tramway in the middle of the road. Beslan said the area had seen some of the heaviest battles. He smiled when asked the name of the street and nodded toward the battered sign at the corner -- "Peace Street". The rebels have been issuing passes to journalists to travel around their self-proclaimed Republic of Ichkeria, as they call Chechnya. They have set up their own checkpoints around Grozny and their own rebel city administration. The rebel mayor of Grozny is Leche Dudayev, a nephew of former Chechen leader Dzhokar Dudayev, reported killed by a Russian rocket in April. Under the peace agreements, consolidated at Tuesday's talks between Tikhomirov and Maskhadov, troop withdrawals from Grozny are due to resume on Wednesday although some soldiers were preparing to leave on Tuesday. Seven trucks filled with Russian Interior Ministry troops were lined up in a southern industrial district of Grozny, having abandoned their checkpoint. "We are going home now, out of Chechnya," said Andrei, 36, wearing sun-glasses and a mustard coloured headband. A convoy of some 300 Russian armoured vehicles passed through Serzhen-Yurt village on Tuesday after leaving the Vedeno mountain district, Reuters TV cameraman Igor Shatalov said. They were heading for Khankala, the main Russian base in Chechnya, just outside Grozny. 3866 !GCAT !GPOL !GVOTE Bulgaria's central electoral commission (CEC) said on Tuesday it has refused to register the presidential candidates of the ruling Socialist Party (BSP) and the anti-communist opposition because of legal inconsistancies. The BSP's presidential candidate, American-born Georgi Pirinski, lacks a document showing how he obtained Bulgarian citizenship, CEC officials said. They said there were inaccuracies in some of the documents of the opposition candidate Petar Stoyanov and commission members had rejected a proposal to give time to the opposition to remove the errors. The presidential contest is set for October 27. Foreign minister Pirinski was born in New York in 1948 of a Bulgarian father and an American mother. Last month the Constitutional Court ruled he was not a Bulgarian by birth -- a condition the constitution sets for the country's president. Stoyanov, a lawyer who beat current President Zhelyu Zhelev in Europe's first primary election in June, belongs to the main opposition Union of Democratic Forces. The coalitions of the two candidates said they would appeal the CEC decision to the Supreme Court. "The final decision (whether to register a candidate for the presidency) will be taken by the Supreme Court," CEC chairman Baicho Panev told reporters. 3867 !GCAT !GCRIM Sex tourism involving abuse of children is spreading to East European countries such as Romania but authorities and public opinion are failing to take the problem seriously, child welfare workers said on Tuesday. State institutions and the general public refuse to believe there is a growing problem with paedophilia, juvenile prostitution and child abuse in Romania, said George Roman, programme manager for the charity "Save the Children." As experts gather in Stockholm for a global meeting to tackle the sexual exploitation of minors, scant public attention is being paid to the subject in places like Romania, where controls on abuse are lax. "We could face some overwhelming social problems unless Romania issues new laws and reforms old statutes to include new phenomena like paedophilia," said Roman. "We've already witnessed the start of sexual tourism here." "The support for our work is minimal," said Roman. "Most people have little sympathy for children living on the streets, the main victims, and say they should be locked up or put to work," he said. The December 1989 revolt against communism and execution of late Stalinist dictator Nicolae Ceausescu ended strict social controls and led to an explosion in pornography, child prostitution and trafficking in minors. Bucharest has now become an attractive destination for well-organised paedophiles, with the estimated 2,000 children living in squalor on the city's streets easy prey for visitors. "In these countries it is easy for a westerner to make himself pleasant and attract children for prostitution gangs under the guise of charity," said Ecaterina Laudatu, secretary of the National Child Protection Council (CNPC). Children were invited to Britain and saved only by the police there who recognised their hosts as known paedophiles, Laudatu told the daily Libertatea. After Romania tightened laws on adoption criminals set up commercial operations inside the country. State childcare agencies have little funding and no programmes to fight them. Save the Children estimated some 50 paedophiles travel regularly to Romania, posing as tourists or businessmen, and rent apartments where they bribe or force children into appearing in photographs or films. One particular Frenchman comes every two months with friends to "make pornographic films and shoot pictures," said Roman. Bribing policemen guarantees impunity, he added. "The children don't resent these sexual experiences because they earn good and quick money," Roman said. "They don't realise the damage it is doing to them." One formerly sexually abused boy, now 16, has graduated to being a leading supplier of children for French, British and German paedophiles. His case is symptomatic of how sexual abuse will quickly spread, said Roman. "In four, five years they might develop a whole network, which will be almost impossible to fight against as the country has no controls," Roman said. 3868 !GCAT !GPOL !GVOTE Estonia's parliament failed for a second time to elect a president on Tuesday, dealing a blow to incumbent Lennart Meri and pushing the country towards stalemate in its choice of a new head of state. Neither Meri, who oversaw Estonia's first steps into statehood after the collapse of the Soviet Union, nor his arch-rival, former communist Arnold Ruutel, have secured the 68 votes necessary from the 101-member parliament. Meri garnered 49 votes and Meri 34 in Tuesday's ballot for the five-year presidency of Estonia. A third and final vote was due to be held when parliament reconvened on Tuesday but legislators were not expecting a clear result. If there is no result the decision will be ceded to an electoral college. "The votes are a strong message to Meri that he is not favoured by some politicians any more," Reform Party head Heiki Kranich told Reuters. Under a constitution agreed in 1992, a year after independence, the president has no executive powers. His only political role is to smoothe the functioning of government in periods of crisis. But Meri, 67, has been accused in parliament of taking too much power and not always consulting parliamentarians before making decisions. His relations with a leftist-led government have sometimes been tense. His support in the first round of voting on Monday was much lower than expected, scoring only 45 votes, which political analysts put down as a vote of no confidence in his performance. This support only inched up to 49 in the second vote. Support for Ruutel, 68, remained constant at 34 votes. If the third vote fails to give either Meri or Ruutel 68 votes, the parliamentary speaker will convene an electoral college of 101 MPs and 273 local goverment representatives to hold a new poll that could include new nominations. This would be the first time that the former Soviet republic has had to call together an electoral college. In its first presidential election in 1992 Meri won the necessary votes in in a parliamentary election against Ruutel. Parliamentary organisers said the exact timetable remained unclear but it would probably take about a month to organise an electoral college which could also hold several rounds of voting before a clear winner emerges. 3869 !GCAT !GPOL !GVOTE The Estonian parliament failed for a third and final time to elect a new state president on Tuesday, refusing a second mandate for incumbent Lennart Meri. Neither Meri nor his rival Arnold Ruutel could garner the 68 votes needed from the 101 members of parliament to become president. In the third vote Meri won 52 and Ruutel won 32 votes. The final decision will now be made by a larger assembly. Meri won 49 in a second vote earlier on Tuesday and 45 in the first on Monday. Ruutel won 34 votes in the first two secret ballots. Enn Markvart, chairman of the National Election Commission said 96 members of parliament cast votes, with one ballot paper invalid and 11 abstentions. The election will now go before an electoral college involving MPs and local government representatives that will be convened by the parliamentary Speaker in the next day or so. It could take up to a month before a new vote but the timetable is not yet clear. This is the first time the former Soviet republic has had to convene such a group. 3870 !C12 !CCAT !GCAT !GCRIM !M11 !MCAT Slovenian shares firmed 0.54 percent on Tuesday on investor relief the Ljubljana district court found drugs wholesaler Salus not guilty of a faulty privatisation. "Salus informed us today that the Ljubljana district court decided it would not have to change its ownership structure," Tomaz Klemenc of the Ljubljana bourse told Reuters. In February, Salus appealed against the Payment Agency's decision that Salus should give the state an 80-percent stake in the company. The government does not own any part of Salus. Nobody at Salus was available for comment. "The court decision is good news and could push the index higher by the end of the week," one broker said. * The seven-share SBI index rose 5.29 points to 993.64. * Ten shares rose and six fell, while seven were untraded. * Turnover rose to 74.6 million tolars from 28.1 million. * Financial consultancy Dadas had the highest turnover and was also the leading decliner, falling 4.53 percent to 33,873 tolars on volume of 750 shares for total turnover of 25.4 million tolars. * Salus was the biggest gainer, surging 9.61 percent to 10,468 tolars on volume of 1,710 shares for total turnover of 17.9 million tolars. -- Novica Mihajlovic, Ljubljana newsroom, 386-61-125-8439 3871 !G15 !G158 !GCAT !GDIP A landmark Croatian-Serbian recognition treaty will help revive Croatia's moribund bid for ties with the European Union, Western diplomats said on Tuesday. But they said that to build up real momentum towards EU acceptance, Croatia must prove it will fully heed the 1995 Dayton peace treaty on Bosnia, where minority Croats take their cues from Zagreb's nationalist government. The August 23 bilateral treaty is seen as a new foundation for peace because it also buried the nationalist Serb crusade for a "Greater Serbia" which engulfed Croatia and Bosnia in war in 1991-92 and shattered the Yugoslav federation. Croatia, which had enjoyed West European support in talks to regain Serb-held land, squandered it in an offensive to recapture the territory last year in a battle that drove out 180,000 minority Serbs. Human-rights monitors say the few thousand left behind have been persecuted. Zagreb regained EU points by co-signing the Dayton treaty, only to regress again by annulling opposition victories in local elections, hounding critical media and failing to silence Croat separatists in Bosnia as Dayton required. European Commission President Jacques Santer warned Croatia and its old Yugoslav neighbours in June that EU doors would stay closed until they normalised relations and displayed full respect for Dayton's provisions. Croatian President Franjo Tudjman, a strident nationalist, reacted by angrily denouncing what he said were EU attempts to railroad Croatia into a new Yugoslav federation dominated by Serbs. Croatia's relations with the EU threatened to sink out of sight a month ago when Croat separatists boycotted the results of EU-sponsored elections to reunify the Bosnian city of Mostar. Moslems narrowly won the poll. U.S. intervention, given teeth with threats of sanctions, scuttled the Croat boycott and secured a Croat pledge to abolish a breakaway mini-state by September 1, keeping Bosnia's countrywide elections on track for next month. Diplomats said Tudjman knew by this time that there was no alternative but to try to satisfy terms for EU links. Within days, in mid-August, he popped up in Athens for a surprise "summit" with Serbian President Slobodan Milosevic in which they agreed mutual recognition and normalisation. Their foreign ministers signed the treaty in Belgrade 10 days later. "With the Belgrade agreement, the Croatian government is showing it is serious about improving relations with all its neighbours," said a senior Western diplomat in Zagreb. "Croatia here has also underlined the positive effects it can have on the Bosnian peace process. That's important for the EU's 'regional approach' policy to former Yugoslavia, so the Croats have fulfilled one of the EU requirements." Footdragging by Milosevic had delayed Zagreb-Belgrade recognition but he finally endorsed it for the same reason as Tudjman -- to curry Western economic favour, diplomats say. The EU presidency on Monday commended the pact as a constructive step towards peace and stability in the region. Croatia's biggest hurdle now en route to EU links will be to show consistent, good-faith support for Moslem-Croat reintegration in a shaky Bosnian Federation. In Croatia, like Serbia, the Belgrade treaty has elicited reactions beyond government circles that range from often lukewarm to critical. The accord will have little immediate practical impact as many key issues, such as cross-border travel and trade and a return of Serb war refugees, were left to further talks, likely to be difficult and protracted. And many Croats complained the pact contained no references to the Yugoslav army's devastating war to crush Croatian independence in 1991, nor a Serbian apology for it. "Mutual recognition comes as a hasty and controversial act based on a diktat from (the West) and private arrangements by Tudjman and Milosevic, rather than on ripe, publicly debated conditions," said Stijepo Martinovic, an opposition leader. 3872 !GCAT !GDEF Yugoslav army officers are visiting Croatia to count Croatian army artillery pieces under an arms-control agreement signed in Florence last June, state media said on Tuesday. They said a five-member team of Serbian officers met a Croatian army delegation at the border on Monday and immediately went to the first of seven planned inspection sites, a barracks in the northwest town of Varazdin. Croatian militaries in turn are due to pay six visits to artillery sites in Serbia, the dominant remaining Yugoslav republic, to check "registered and unregistered" locations, the government-run newspaper Vjesnik said. Bilateral arms control went ahead after Croatia and Yugoslavia signed a mutual recognition treaty in Belgrade last Friday, normalising relations after five years of conflict. 3873 !GCAT !GCRIM Albanian authorities have arrested and charged a British man for sexually abusing two young boys, a Tirana prosecutor said on Tuesday. "We have arrested him and charged him with these shameful acts of sex abuse of little children," prosecutor Adnan Xhelili told Reuters. Xhelili said Paul Thompson, 34, from Wiltshire, was arrested on Sunday in a hotel in the Adriatic resort of Durres, 45 km (30 miles) west of Tirana. Thompson has denied the charges. He could face up to five years in jail if convicted. Xhelili said Thompson, who is divorced, said he befriended the boys, both aged under 10, because they reminded him of his own children who live with his former wife in London. The prosecutor's office said no date had yet been set for a trial to begin as investigations had first to be completed. The British embassy in Tirana said it had sent an embassy official to talk to Thompson who is being held in jail. The age of consent for heterosexual and homosexual sex in Albania is 14. A large number of destitute children can be seen begging in the streets of impoverished Albania, especially in towns and resorts visited by foreigners. 3874 !GCAT !GCRIM !GPOL Bulgaria's Supreme Court has overturned death sentences and long jail terms against 48 pre-communist leaders and three royal regents imposed by a communist court half a century ago, an official said on Tuesday. She said the Supreme Court voted 2-1 to revoke convictions against the king's three regents as well as prime ministers and ministers for their responsibility for Bulgaria's involvement in the World War Two. A regent is a person appointed to administer a state because the monarch is either a minor, incapacitated or absent. The regents of the under-age King Simeon II were chosen in August 1943 after the death of his father King Boris III. A 13-member jury of the so called People's Court had sentenced to death 33 out of the 51 convicted officials and politicians in February 1945. Bulgaria was Germany's ally during World War II. All the death sentences were carried out. Officials do not know if any of those serving up to 20 years in jail -- all were over 40 when sentenced -- are still alive. The communist People's Court had given no justification for its verdicts, Supreme Court officials said. Among those executed were the last three prime ministers before the communist takeover in Bulgaria in 1944. They were Dobri Bozhilov, Ivan Bagryanov and Konstantin Mouraviev. The local Standart daily said the three cabinets had tried to loosen Bulgaria's commitment to Nazi Germany. King Simeon, now a Madrid-based business consultant, fled Bulgaria as a child in 1946 after the Soviet Red Army installed a puppet government. He was given a warm public welcome but an official cold-shoulder from ruling socialists on his return home in May. 3875 !GCAT !GPOL !GVIO One year ago Sarajevo's main street was a virtual slaughterhouse. Mangled bodies and severed limbs littered the pavement. Rivulets of blood coursed down channels in the pavement cut for trolley tracks. A mortar bomb had detonated outside the entrance to a busy downtown market, just as tens of thousands of other shells had exploded in the city during the Bosnian war. But this one killed 37 people and wounded 85. It was not the highest civilian casualty toll in a single incident, but the world had finally seen enough. U.N. officials accused Bosnian Serb forces besieging the city of the August 28 massacre. Two days later NATO warplanes began bombing Serb military installations and NATO artillery pounded Serb gun positions around Sarajevo. Once Western military intervention began in earnest the Bosnian war was effectively over. It had dragged on for 41-months at a cost of several hundred thousand dead and several million refugees, A ceasefire followed in October. The final peace agreement was signed in Paris on December 14, 1995. Sarajevo had lost 10,000 dead and 50,000 wounded to the long Serb siege. Today a frantic veneer of normality has settled over the Bosnian capital. Traffic accidents, not sniper rounds or mortar bomb fragments, are the greatest risk to life and limb. Demobilized soldiers, mostly unemployed, lounge in local cafes, day and night, nursing coffees, smoking cigarettes and chatting up women. New restaurants and shops open every day, many catering to the well-heeled horde of international bureaucrats who have descended on Bosnia to help rebuild everything from roads, bridges and housing to the country's army and government. War-tourists visit Sarajevo in organized groups now. They gaze on the city's main battle sites, tramp through abandoned trenches and even choke down souvenir siege meals crafted from aid packets like the ones residents lived on for years. Local humour reveals continued morbidity and a deep, cynical sense of unease over the future. "Dretelj", a Croat concentration camp for Moslems during the war, is the nickname given by locals to a popular cafe on Titova street. Why? Because like Dretelj the camp, the cafe was built by Croats and is full of Moslems. An opposition party contesting upcoming national elections urges Bosnians to vote for anyone but the politicians in office and offers a campaign pamphlet with this commentary on the incumbents' war record: "They told us they would take us into Europe. What they didn't tell us is we'd all be going in wheelchairs." Even as Bosnia struggles to put the war behind it, some are hard-pressed to let go. Psychiatrists report massive adjustment problems among soldiers and civilians alike -- an entire society suffering from post-traumatic stress. Some people for whom life in a fighting trench or a cellar shelter became the norm miss the routine and comradeship of war. Cut loose from the daily search for water, food and firewood and from the regular surge of adrenalin occasioned by sniping and shelling, they have slumped into ennui. The brash, bustling, cosmopolitan Sarajevo where Moslems, Serbs and Croats mixed before the war astride one of the world's great religious and cultural fault lines is no more. Tens of thousands of Serbs fled their Sarajevo suburbs when the peace deal took those districts from Serb control and handed them to the Moslem-Croat administration. The middle-class which fled during the war has been slow to return. Country folk with country ways now live in their flats, conservative Moslem refugees from villages across Bosnia. Having fought to preserve its multi-ethnic ideal through the longest siege in modern history, Bosnia's capital has become overwhelmingly Moslem in peace. Sarajevo's main meeting ground for Moslems, Serbs and Croats today is its cemeteries where their graves are sorted in ragged, weed-infested columns and rows along steep hillsides. Pelka Acimovic, 37, was selling cigarettes outside the market on August 28 when the mortar bomb landed. Hit in the leg by shrapnel, she still limps. The woman is glad to be alive but gloomy about the past and the future. "Yes, peace has come since the massacre. But could you tell me why the world waited so long to act, why there had to be so many years of war and so many victims?" she said. "I don't believe in these upcoming elections. The same people will win who made the war. Nothing has changed." 3876 !GCAT !GPOL !GVIO Aides of Russian President Boris Yeltsin have asked Chechen envoy Alexander Lebed for a written account of his proposed political settlement in the region, a spokeswoman for Lebed said on Tuesday. Confirming a report by Interfax newsagency, she said documents containing a "comprehensive plan" and an account of Lebed's weekend talks with separatist leaders would be passed to the president at 5 pm (1300 gmt), after which Yeltsin might decide to speak to Lebed in person or by telephone. Russian and Chechen commanders earlier finalised a truce brokered by Lebed, settling disputes that had held up moves to separate the warring sides and monitor the ceasefire. But Lebed's quest for a lasting political settlement for the region appeared to be stalled after Yeltsin, starting a holiday near Moscow, ignored his calls for a meeting. The Russian army commander in Chechnya, General Vyacheslav Tikhomirov, and rebel chief-of-staff Aslan Maskhadov signed the final ceasefire document in the rebel-held village of Novye Atagi, some 20 kms (12 miles) from the Chechen capital, Grozny. Progress in Chechnya was not mirrored in Moscow where Lebed was still waiting to see Yeltsin, who appointed the former general as his special envoy to the region two weeks ago. 3877 !GCAT !GCRIM !GREL Vandals destroyed more than 200 tombs in a Jewish cemetery in Budapest this month although police say they left no specifically anti-Semitic marks, such as swastikas or slogans painted on tombs. Details of the vandalism, which occurred the weekend of August 17-18, have trickled out in Hungary's national press. "This is the biggest damage so far," Laszlo Garami, who oversees Jewish cemeteries on behalf of Hungary's 150,000-strong Jewish community, said on Tuesday. Newspapers quoted police officials as estimating the damage at five million forints ($33,300), while Jewish officials said it could be 10 times that much. "Such things happen in many cemeteries but we don't know the reason," a police spokeswoman said. "It doesn't show that it has been an anti-Semitic action and we will only know if we can talk to those who did it." "There is no sign that would indicate it was anti-Semitic but it happened in a Jewish cemetery." Last April, vandals broke into another Jewish cemetery in Budapest and spray-painted swastikas and Stars of David on about 12 tombstones. Earlier the same month, vandals toppled 79 tombstones in a Jewish cemetery in the northern town of Eger. 3878 !GCAT !GVIO Russian and rebel military commanders in Chechnya said they had resolved their remaining differences on Tuesday and signed a final ceasefire agreement brokered last week by Kremlin envoy Alexander Lebed. In Moscow, meanwhile, President Boris Yeltsin ignored requests for a meeting with his security chief on Tuesday, casting new doubt over the peace process initiated by Lebed. "Boris Yeltsin is continuing his vacation at his "Rus' residence in the Moscow region," Itar-Tass news agency reported Yeltsin's press office as saying. Russian general Vyacheslav Tikhomirov told reporters in the Chechen village of Novye Atagi that a dispute over weapons seized from Russian soldiers would pose no further obstacle to the ceasefire agreement. "The weapons seizure incident is virtually over. There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement on what he called the "practical implementation of the Lebed plan". Separatist chief-of-staff Aslan Maskhadov said both sides had pledged to avoid any further breakdown in the peace process. "We gave each other our word that no provocations would become grounds for a breakdown of negotiations," he said. "Somehow in the end we got around to really acting on creating peace." Tikhomirov said troops would resume pulling out of Grozny on Wednesday after halting at the weekend when a group of soldiers had their weapons taken. A military source told Interfax news agency that the army withdrawal from Grozny should end around September 1 -- next Sunday. Withdrawal from some southern districts of Chechnya including Vedeno would be completed on Tuesday, Tikhomirov said. A final army withdrawal from the region would be the subject of new talks in the future, he added. Tikhomirov said that over the next four days a system of joint Russian-Chechen police patrols would be fully under way in Grozny, much of it in rebel hands since an August 6 offensive. The two sides would also begin work on exchanging prisoners. Interfax quoted a rebel source as saying that, under the terms of the final agreement, the joint units would be deployed around Grozny around 6 p.m. (1400 GMT) on Tuesday. Last Thursday, Yeltsin, in an interview broadcast hours before Lebed finalised the truce, said he was not satisfied with Lebed's work in Chechnya. Only late the following day did he voice support for Lebed's efforts. 3879 !GCAT !GPOL !GVOTE Estonia's parliament again failed to elect a new state president on Tuesday when neither of two candidates secured a majority in second-round voting. Incumbent president Lennart Meri won 49 votes compared to 34 won by his rival, deputy Parliamentary Speaker Arnold Ruutel. But Meri's support was not enough for the 68 needed for election and a third secret ballot will take place later in the day (1300 GMT), parliamentary officials said. To win a clear mandate for the five-year presidential term, a candidate must secure 68 votes from the 101-member parliament. Enn Markvart, Chairman of the National Election Commission, said 96 members of parliament voted in the second round, with 12 abstentions and one ballot paper invalid. On Monday, in the first round of voting, Meri secured 45 votes and Ruutel 34. Meri's popularity has suffered in recent years, with politicians criticising him for taking too much power and acting without consulting parliament. If a third round of voting fails to give either candidate 68 votes, the parliamentary speaker has to convene an electoral college of all 101 MPs and 273 local government representatives for a new vote that could take up to a month. 3880 !GCAT !GCRIM Marc Dutroux, the chief accused in Belgium's sensational child murder and sex abuse case, visited Slovakia a number of times and about 10 young Slovak women went to Belgium at his invitation, police said on Tuesday. But they have difficulty remembering what happened there, perhaps because of drugs, and are unsure whether they were filmed for pornography, Rudolf Gajdos, head of the Slovak office of Interpol, told Reuters. Although Gajdos spoke of "girls" his deputy, Eva Boudova, said the case involved about 10 young women in their early 20s. "The police interrogated several Slovak girls who said that they had been invited by Mark Dutroux to visit Belgium," Gajdos said. "The girls said they went to Belgium voluntarily and the police suspect that they were used to act in pornographic films." "The police suspect (the girls) were under the influence of drugs as some girls admitted they took unspecified pills." "We have suspicions of a rape, but the police still have to find the victim," Gajdos added. Dutroux's last visit to Slovakia was reported to have been as recent as July. Slovak police are also cooperating with Belgium in the search for An Marchal and Eefje Lambrecks, who went missing last August. Dutroux, 39, who was charged last week with the abduction and illegal imprisonment of two other girls aged 14 and 12, is one of several suspects in the Marchal and Lambrecks case. Last Saturday he led police to the bodies of two other girls, aged eight, who died of starvation this year after their abduction in June, 1995. The Czech office of Interpol said on Friday it would neither confirm nor deny that Dutroux had been in the Czech Republic, Slovakia's western neighbour and former federation partner. Belgian police said an officer had visited Bratislava to talk with Slovak detectives about An and Eefje and other disappearances, and he planned to go also to Prague. 3881 !GCAT The following are the reports carried by Estonia's newspapers on Tuesday. Reuters has not verified these reports and does not vouch for their accuracy: POSTIMEES - The Defence Ministry has drafted a government decree on a new programme for the training of conscripts. SONUMILEHT - Several hundred pensioners demanded an increase in their pensions at a rally in front of the government building in Tallin on Monday. - Families of victims of the 1994 Estonia ferry disaster have been unsuccessful in their attempts to start legal proceedings against Meyer's shipping yard and certification officials from Bureau Verita. EESTI PAEVALEHT - President Lennart Meri is expected to appoint eight new ambassadors tomorrow. ARIPAEV - Most observers believe that the new Estonian president will be elected by the electoral college. -- Riga Newsroom +371 7226693 3882 !C24 !CCAT !GCAT !GWEA No closures of airports due to bad weather are expected in the Commonwealth of Independent States on August 28 and August 29, the Russian Weather Service said on Tuesday. -- Moscow Newsroom +7095 941 8520 3883 !GCAT !GPOL !GVIO Russian and rebel military commanders in Chechnya said they had resolved their remaining differences on Tuesday and completed a ceasefire agreement brokered last week by Kremlin envoy Alexander Lebed. Russian general Vyacheslav Tikhomirov told reporters in the Chechen village of Novye Atagi that a dispute over weapons seized from Russian soldiers would pose no further obstacle. Separatist chief-of-staff Aslan Maskhadov said both sides had pledged to avoid any further breakdown in the peace process. Tikhomirov said troops would resume pulling out of Grozny on Wednesday after halting at the weekend when a group of soldiers had their weapons taken. Withdrawal from some southern districts of Chechnya would be completed on Tuesday, he said. A final army withdrawal from the region would be the subject of new talks in the future, he added. Tikhomirov said that over the next four days a system of joint Russian-Chechen police patrols would get under way in Grozny, much of it in rebel hands since an August 6 offensive. The two sides would also begin work on exchanging prisoners. "There will be no more obstacles to the continuation of our task," Tikhomirov said following the final agreement on what he called the "practical implementation of the Lebed plan". "We gave each other our word that no provocations would become grounds for a breakdown of negotiations," Maskhadov said. "Somehow in the end we got around to really acting on creating peace." 3884 !GCAT !GPOL !GVOTE The same two candidates will stand for the presidency of the Baltic state of Estonia on Tuesday after a first round of voting ended in stalemate, electoral officials said. Incumbent Lennart Meri and deputy speaker of parliament Arnold Ruutel both failed to win the 68 votes from the 101-member parliament on Monday for a clear mandate to rule the former Soviet republic for five years. Poor support for Meri was widely regarded as a backlash against his recent performance, but he was also thought to be suffering a hostile campaign alleging that he once had links with the Soviet secret police, the KGB. A second round of voting was called for Tuesday with the election reopened for new nominations. After 24 hours of tense party political meetings a spokeswoman for the National Election Commission said the same two candidates would be competing when parliament reconvenes at 0900 GMT on Tuesday for a second vote. "No more candidates were nominated," the spokeswoman told Reuters. If neither candidate secures the necessary 68 votes in the second round a third round of voting will be held later on Tuesday. If this fails -- and many political commentators believe it will -- then the parliamentary speaker will have to convene an electoral college of the 191 members of parliament and 273 local government representatives for a new vote that could take a month to organise. Political commentators were not holding out much hope for parliament to produce a result. "Parliament is just about to give up the right to choose a president to an electoral college," said an editorial in the country's largest newspaper Postimees. In Monday's vote the charismatic Meri, 67 years old, only secured 45 votes, way below the expected 50 to 60 and he remained in the presidential residence all day. Meri, who won the presidency in a battle against Ruutel in 1992, remains popular among Estonia's 1.5 million people for successfully representing his country on the international stage and for calmly handling a government collapse in 1995. But his popularioty among politicians has waned. He has been criticised for taking too much power and making the presidency into an unofficial upper house of parliament. Meri angered parliament in 1994 when he signed an agreement with Moscow for the withdrawal of Soviet troops without consulting the country's parliamentarians. "The parliament expressed a vote of no confidence in the president yesterday," said Postimees. It was unclear whether Meri would get the required support in Tuesday's vote. "If the candidates are the same in parliament today I dare say that Lennart Meri will not get more than 65 votes, even in the third round," said Kalle Muuli, editor in chief of the second major daily, Eesti Paevaleht. But supporters of Ruutel, a senior communist during the Soviet era and a leader of Estonia's independence movement were keen for the vote to go to an electoral college. Ruutel,68, former head of an agricultural college, has strong support in rural areas and among older Estonians and would have a better chance in a wider vote, commentators said. 3885 !GCAT !GCRIM Russian police in the Urals city of Perm are on the trail of a serial killer who has claimed his seventh victim in just a few months, Itar-Tass news agency said on Tuesday. In the latest attack, the killer raped and stabbed a young woman in a lift, leaving her body on a landing. Tass did not say exactly when it took place. Police earlier released a suspect after women who had survived an attack failed to identify him. 3886 !GCAT These are the leading stories in the Skopje press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. DNEVNIK - Delegations of experts from the Yugoslav and Montenegrin economics ministries are looking into the details of future commercial cooperation. - The government's coalition partners -- the Socialist Party and the ethnic-Albanian Party of Democratic Prosperity -- have almost reached an agreement about the territorial division of Macedonia which will be decisive for the PDP's participation in the forthcoming elections. - A new aggressive algae is destroying lake Dorjan, on the border with Greece, which is already facing an ecological catastsroiphe thanks to the constant draining of its waters by Greek farmers. - At least fifty workers of the Skopje glass factory went on a hunger strike in protest against alleged manipulation in the plant's privatisation process. NOVA MAKEDONIJA - The opposition is not satisfied with the changes to the local election law which are to be presented to parliament in early September, while the ruling coalition Social-Democratic Union considers the law to be flawless and with high standards. - Industrial production shows signs of reviving, but the 3.8 percent growth this year is far from real recovery. VECER - This year's produce is rotting in Macedonia's fields due to a lack of buyers. This will hurt next year's harvest because farmers are planning to plant less. After this year's abundance there will be no garden produce next year. -- Skopje newsroom 389 91 +201196 3887 !GCAT Lithuanian newspapers carried the following reports in their Tuesday editions. Reuters has not verified these stories and does not vouch for their accuracy: LIETUVOS RYTAS - The president's office is discussing an amendment to the criminal code to imprison tax evaders for up to four years. - The minimum monthly wage will be increased to 300 litas from September 1 and the minimum hourly wage will be 1.76 litas. - Lithuanian President Algirdas Brazauskas empowered Lithuanian officials to sign credit agreements with three Western Banks to finance major highway and road projects. RESPUBLIKA - Lithuanian President Algirdas Brazauskas appointed his advisor on Foreign Policy Affairs Justas Paleckis as Lithuania's ambassador in Great Britain. - 73 percent of those questioned in a poll conducted by the Lithuanian-British research company Baltijos Tyrimai said they trusted the church, while only three percent said they trusted commercial banks. The results were as follows: The church, 73 percent; mass media, 72 percent; armed forces, 36 percent; the court system, 24 percent; the president's office, 21 percent; Bank of Lithuania, 21 percent; government, 17 percent; tax inspection, 13 percent; parliament, 13 percent; commercial banks, 3 percent. VERSLO ZINIOS - Statoil Lietuva intends to raise diesel fuel prices on September 1 and Shell Lietuva UAB will increase diesel and petroleum prices on Wednesday. - Lithuanian lawmakers approved the law on State Loans on August 22 which established that loans exceeding 40 million litas (except loans to finance the budget deficit) should be approved by parliament. - Lithuanian experts think that the recent visit of high ranking officials from JP Morgan to Lithuania reveals the increasing interest of investment banks in the second stage of privatisation. -- Riga Newsroom +371 226693 3888 !GCAT These are the main stories in Latvian newspapers on Tuesday. Prepared for Reuters by the Co-operation Fund. Reuters has not verified these reports and does not vouch for their accuracy: ALL NEWSPAPERS - The faction of the party Latvia's Way proposes its deputy Edvins Inkens to the post of chairman of the parliament's Committee for European Affairs, which stands vacant since the former chairman, Anatolijs Gorbunovs, became the Minister of Environment Protection and Regional Development. - According to the Ministry of Finance, the state budget deficit on August 21 was 28.18 million lats. The deficit of the social budget, meanwhile, was 12.3 million lats. - The Russian Ministry of Foreign Affairs has issued an official statement which calls provocative the occupation declaration, adopted last week by the Latvian parliament. DIENA - The passengers of a Latvian ship, belonging to a bankrupt company, have been banned from going ashore by the Swedish authorities. - The governing factions support the idea of the Prime Minister to liquidate elected local governments in the districts, but object to the idea that districts could be ruled by governors, appointed by the Cabinet. - The faction 'For People and Justice', which broke away from the opposition faction 'For Latvia', has declared its desire to join the governing coalition. NEATKARIGA RITA AVIZE - The state-owned Latvian Railway company has brought suits against three ministries in an attempt to recover 814,000 lats spent on free tickets for disabled persons, victims of political repression and other passangers whose railway trips must be subsidised by the government. BIZNES & BALTIYA - The American Republican senator, Richard Lugar, arrived on an official visit in Latvia. -- Riga Newsroom +371 7226693 3889 !GCAT The following are the main stories from Tuesday morning's Albanian newspapers. Reuters has not verified these stories and does not vouch for their accuracy. KOHA JONE - President Sali Berisha called for the dissolution of the opposition Socialist Party because it is the only political force which may take power away from his ruling party, an editorial commentary said. - Police destroy a prostitution centre in Tirana arresting 11 people, including the owner, women and clients. - The ruling Democratic Party held a meeting of its presidency mostly concentrating on last weekend's Socialist Party congress. - Reform of the Socialist party at a weekend congress was reached after a strong debate between the supporters of jailed leader Fatos Nano and his opponents. - The daughter of a former persecuted army general to sue Defence Minister Safet Zhulali for changing her job. - Vouchers distributed by the government have slumped in value to 11 percent from 12.5 percent last week. - Smaller banks have stopped giving credits considered as a measure taken by the government to keep inflation under control. GAZETA SHQIPTARE - Former Socialist deputy leader Servet Pellumbi resigned, though many among the leadership asked him not to do that. - Council of Europe is to lead and organise the international monitoring of the upcoming local elections in Albania on October 20. RILINDJA DEMOKRATIKE - President Sali Berisha sends a telegram to Mother Teresa on her birthday wishing her a long life and quick recovery. - Italian government has given $3.1 million to Albania for agricultural projects. ZERI I POPULLIT - The Socialist Party held its second congress to strive for change and complete its detachment from the past. Jailed leader Fatos Nano was again elected as party chief. 3890 !GCAT These are the leading stories in the Belgrade press on Tuesday. Reuters has not verified them and does not vouch for their accuracy. POLITIKA - Yugoslav state and economic delegation headed by Deputy Prime Minister Nikola Sainovic visits Sarajevo and Banja Luka and agrees concrete forms of cooperation, including regular Yugoslav airline flights to the two towns within ten days. - Yugoslav Foreign Minister Milan Milutinovic is visiting Rome and the Vatican Tuesday. - Yugoslav and Macedonian expert teams are putting finishing touches to a bilateral trade agreement in Skopje. - Croatian bus company Autotrans of Rijeka and Belgrade's Lasta agree to establish direct cross-border bus links between Belgrade-Rovinj, and Belgrade-Rijeka and Rijeka-Novi Sad and Rijeka-Pristina. - Federal economics ministry to discuss plans for the construction of a 700 km trans-Balkan gas pipline from Dimitrovgrad via Nis and Bar to Bari in Italy which would transport an additional seven to ten thousand cubic meters of Russian gas to Italy. - This year's yields of corn, sunflower, soya and sugar beet will be average despite the severe drought, says Yugoslav agriculture minister Tihomir Vrebalov. There will be enough sugar for domestic needs and about 60,000 tonnes of oil in excess which could be exported. - Ethnic Albanians in Kosovo will not take part in the forthcoming elections, says President of the Democratic League of Kosovo Ibrahim Rugova. NASA BORBA - Kragujevac Zastava arms factory protest gathers momentum entering its second week, workers ban directors from entering factory. - Proposal submitted by Arthur Watts on economic succession of the former Yugoslav federation meets objections from all former federation members, most serious being related to state property. VECERNJE NOVOSTI - Montgenegrin President Momir Bulatovic says the Yugoslavia-Croatia normalistion agreement increases chances of finally settling the issue of the Prevlaka peninsula. - Trade between Ukraine and Yugoslavia could soon reach the value of over two billion dollars, agree Yugoslav Prime Minister Radoje Kontic and Ukrainian ambassador in Belgrade Vadim Primachenko. -- Belgrade newsroom, 381 11 +224305 3891 !GCAT Here are highlights of stories in Romania's press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy: Business: ROMANIA LIBERA - Leu's reference rate depreciated by 0.54 percent on week from August 19 to 26. Analysts see further depreciation likely. TINERETUL LIBER - Renel RA electricity authority lacks funds to buy energy sources due to financial bottlenecks and trade unions see new electricity price rise as way to solve situation. AZI - Upgrading works on Nadlac and Varsand border crossing points are scheduled to be completed on September 30. Total worth of investment is 20.1 billion lei, up from initially envisaged 5.4 billion. - Sugar factory at Zimnicea plans development to be able to process raw sugar as way to economic recovery. LIBERTATEA - Nuclear reactor at Cernavoda started tests at 75 percent of its full capacity of 660 megawatts. CURIERUL NATIONAL - Bucharest court is to decide on Tuesday fate of troubled Renasterea Creditului Romanesc Credit Bank SA. National Bank took Credit Bank to court after it failed to make payments for one month. General: ROMANIA LIBERA - Civic Alliance, as representive of the civic society, said it would contest at Constitutional Court the candidacy of President Ion Iliescu for a new four-year presidential term in the November 3 polls. - Teofil Pop, former post-revolutionary justice minister, asks President Iliescu not to run for a new term, which he says would be a third and unconstitutional. Pop says the parliament could initiate suspension proceedings of President Iliescu for "breaking the constituion" after the November polls, harming Romania's chances to join NATO and the EU. - Gheorghe Funar, head of National Unity Party (PUNR) asks Foreign Minister Teodor Melescanu to be sacked for having included the Council of Europe's 1202 recommendation in the draft Romanian-Hungarian treaty. - Opposition Democratic Convention (CDR) bloc agrees the Romanian-Hungarian treaty must be signed as quick as possible, but threatens not to attend a meeting with President Iliescu unless the text of the treaty is not given to the parties ahead of the talks with parliamentary parties. - Romania's jails are overcrowded, says a report by the Helsinki human rights defence committee. ADEVARUL - Former Prime Minister Theodor Stolojan, member of the committee supporting President Iliescu in his candidacy for a new term, is likely to run also for parliament on the list of the ruling Party of Social Democracy (PDSR). - President Iliescu is likely to ask next parliament to ammend the constitution on issues like government reshuffles, parliamentary immunity, duties of the government and public administration. - Dan Martian, vice-president of ruling PDSR said report on measures taken by the party over the past month following its anti-corruption resolution is nothing but an "exercice of self-satisfaction". EVENIMENTUL ZILEI - Two financial experts must end the checkings on the Caritas money spinning scheme which collapsed in 1994 sucking in savings worth $1.0 billion from some four million investors. - CDR presidential candidate Emil Constantinescu visiting the southern county of Calarasi, had big success in the birth town of President Iliescu, the newspaper says. ZIUA - Opposition National Liberal Alliance (ANL) and National Centrist Union (UNC) signed political responsability pact saying they would support one another in electoral campaign for the November 3 parliamentary polls. LIBERTATEA - Treaty with Hungary, which keeps the door open for Romania to enter NATO, must be signed in September, said Foreign Minister Teodor Melescanu. CRONICA ROMANA - Opposition CDR would insist on its programme and solutions and would not attack the contenders in the electoral campaign for Novermber 3 polls, said CDR leader Constantinescu. CURIERUL NATIONAL - Romanians and ethnic Hungarians are not enemies, have no contradictory but many common interests, says Gyorg Frunda, presidential candidate of Hungarian Democratic Union (UDMR) in a two-page interview. - PUNR leader Funar proposes Romanian-Hungarian treaty to start functioning only after both countries have been admitted to NATO. ($=3,158 lei) -- Bucharest Newsroom 40-1 3120264 3892 !GCAT These are the leading stories in the Sarajevo press on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy. OSLOBODJENJE - Bosnian Central Parliament meets in extraordinary session on Tuesday to discuss conditions for forthcoming elections. - Bosnian Liberal Party condemns any delay of Bosnian elections, arguing it would reinforce the status quo. - Federal Governement provides 10 million Deutsche Marks to develop agriculture and cattle breeding says Bosnia's Moslem-Croat Federation Prime Minister Izudin Kapetanovic. DNEVNI AVAZ - The United Nations delivers 35,000 tonnes of humanitarian wheat to Bosnia. - Bosnian Serb opposition leader Predrag Radic considers economic situation in Republic of Srpska as catastrophic and accuses the ruling Serb Democratic Party of giving false promises and misinforming the people. ---Sarajevo newsroom, +387-71-663-864. 3893 !GCAT !GPOL !GVOTE The parliament of Bosnia's central government met in special session in Sarajevo on Tuesday to consider the election crisis created by international allegations of irregularities in Serb voter registrations. The parliament session, broadcast live over Bosnian government television, began at 0915 local time (0730 GMT). That was just 45-minutes before a scheduled meeting of the Provisional Election Commission (PEC), the top rule-making body for elections, which is due to decide whether to postpone the municipal vote in response to the registration problem. Diplomats reported that the PEC, an arm of the Ogranisation for Security and Cooperation in Europe (OSCE) mission in Bosnia, was on the verge of cancelling the municipal poll. Diplomats said voting for cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man Presidency would go forward on September 14 as planned. The OSCE's Chief-of-mission for Bosnia, Ambassador Robert Frowick, was scheudled to brief international media at 1400 local time (1200 GMT) about the results of the PEC meeting. OSCE sources on Monday reported that Ambassador Frowick had tentatively decided to postpone all municipal elections until the Spring of 1997 but was consulting with the PEC one last time on Tuesday before making a public announcement. The Bosnian central parliament session on Tuesday was seen by observers as more of a political than a substantive event. The body is a rubber stamp of the Moslem nationalist SDA party which is already on record as favouring postponement of municipal elections. International election monitors have accused authorities of actively discouraging Bosnian Serb refugees in Serbia from registering to vote from their pre-war homes. Instead, monitors say the authorities pressured refugees to to vote from towns which once had Moslem majorities but which are now underpopulated because the Moslems were killed or expelled during the war. Diplomats say the aim of the Serb's electoral engineering is to secure political control of strategically important towns inside that 49 per cent of Bosnia known as the Serb Republic, consolidating through the ballot box what they seized in war. Such a manoeuvre would flip the Dayton peace process on its head by turning elections into a vehicle for the country's permanent ethnic division rather than its reintegration as a multi-ethnic state. If a decision is made to postpone, attention will immediately shift to the Bosnian Serb republic and the reaction of its ruling Serb nationalist SDS party leaders. Some in the SDS have vowed they would hold local elections on their 49 per cent of Bosnia regardless of what the OSCE decides, a move of uncertain legality which would further complicate the already fraught political environment here. OSCE has been wrestling with the registration issue for a week. Time has now run out because more than 640,000 refugees who registered to vote in 55 countries around the world are scheduled to begin casting ballots on Wednesday, August 28. 3894 !GCAT Following are the main stories in Croatian newspapers on Tuesday. VJESNIK - OSCE may decide to postpone first Bosnian post-war elections due in September until spring. Final decision is excpected on Tuesday. - Following an agreement on mutual sub-regional arms control, team of Serbian military experts counted Croatian heavy artillery in eastern Croatia. - Flights between Zagreb and Belgrade may resume as soon as Serbia recognises the authority of the so-called Flight Information Region (FIR) Zagreb which covers Croatia and Bosnia. - Study odered by Dubrovacka Banka says the town will need $600 million to preserve its cultural heritage by the year 2000. Half of the funds would have to come from abroad. VECERNJI LIST - Croatia soon to pass a new law on insurance of bank savings so far insured by the state. Analysts speculate that a sum up to 5,000 German marks might be fully covered. - Regular comercial flight between Zagreb and Sarajevo to start in September, after the first one in years which occured on Monday. - Croatian economy has a lot to offer to Albania which has bacome a huge building site and imports everything from food to textile and furniture, says ambassador to Albania Mladen Juricic. SLOBODNA DALMACIJA - Croatian government plans to spend one billion kuna on pro-natality aid programmes. - January-July tourist figures show 10.5 million overnight stays, 6.1 million of which in July alone. More than two million tourists registered. - Australian Croat Ivan Zovko donates to the old country his stamp collection worth $1 million. -- Zqagreb Newsroom, 385-1-4557075 3895 !GCAT !GPOL !GVIO Russia's military commander in Chechnya began new talks with separatist chief-of-staff Aslan Maskhadov on Tuesday, Itar-Tass news agency said. Tass said the talks were taking place in the settlement of Novye Atagi, some 20 km (12 miles) south of the Chechen capital Grozny. The talks had been postponed while the Russians waited for the rebels to return arms and ammunition seized from Russian soldiers at the weekend. The Chechens said on Monday they had returned all the weapons, which they said were seized by a renegade group. The talks between Maskhadov and Russia's Vyacheslav Tikhomirov are aimed at putting the finishing touches to a ceasefire sealed last week in talks with Russian security chief Alexander Lebed. Lebed, who met Russian Prime Minister Viktor Chernomyrdin on Monday to discuss the progress he made on a political settlement for the breakaway region, has been seeking a meeting with President Boris Yeltsin, who started a holiday near Moscow on Monday. 3896 !GCAT Here are highlights of stories reported by Hungary's press, based on information by Nepszabadsag's Hungary Around the Clock service. For further details on how to subscribe to Hungary Around the Clock, please contact Monica Kovacs at (361) 351 2440 or fax your request to (361) 351 7141. ALL PAPERS - Prime Minister Gyula Horn stood firm in his intention to go ahead with the signing of the Hungarian-Romanian basic treaty when he received leaders of the Democratic Federation of Hungarians in Romania (RMDSZ) in his office Monday. RMDSZ leaders said their opinions had been ignored in formulating the basic treaty. - A total of 87 opposition and independent MPs signed a petition, and so gave their backing to convene a special session of Parliament to debate a proposal calling on the cabinet not to sign a Hungarian-Romanian basic treaty without parliamentary authorisation. - Interior Minister Gabor Kuncze has appointed Antal Kacziba deputy state secretary replacing Dr. Sandor Nyiri. - Prime Minister Gyula Horn Monday nominated Imre Karl, Socialist MP, to review a pending proposal to increase energy prices. - A new bill on credit institutions is set to appear soon before Parliament. - Steel industry giant Dunaferr will be granted a $25 million loan from a total $50 million credit line extended to Hungary by the South Korean government. NEPSZABADSAG - The overwhelming majority of the urban population (93 per cent) supports the endeavours of Hungarian foreign policy to develop ties and guarantee long-term reconciliation with neighbouring countries, while only 4 per cent disagree with the current foreign policy orientation. - The region's biggest privatisation to date, that of the Hungarian Telecommunications Co was lacking in vision and violated pertinent legal regulations, according to a report by the State Audit Office. MAGYAR HIRLAP - Mark Allen, the representative of the International Monetary Fund in Hungary, has expressed concern over the deficit in social insurance funds but hopes that the positive state of the central budget will be able to offset this. - Prime Minister Gyula Horn will be the guest of honour at the main ceremony to be held in Munich on October 3, the day of German unity. - The first half of 1996 saw a revenue surplus of more than $400 million in the tourism sector. - The Nomura research institute has readjusted its estimate of Primagaz Hungaria's full-year net profit from HUF 2.06 billion to HUF 1.5 billion. - The furniture supplier Domus garnered first-half sales revenues 25 per cent below last year's respective figure. - More than 300 experts from 35 countries are attending a four-day international scientific conference in Budapest to discuss ways of preserving the diversity of nature. - Unidentified vandals has caused about HUF 5 million in damage when they overturned or vandalized nearly 100 graves in a Jewish cemetery in Budapest. NEPSZAVA - Interparty consultations on a bill governing the state news agency MTI will soon begin. - Advertisers in Hungary spent HUF 21.8 billion in the first half of 1996 indicating the first period of stagnation since dynamic growth ensued back in 1992. -- Budapest newsroom (36-1) 266 2410 3897 !E21 !E212 !E51 !ECAT !GCAT !GDIP Japan's Prime Minister Ryutaro Hashimoto met President Alberto Fujimori on Tuesday and signed a loan package worth more than $600 million for infrastructure and environmental projects in Peru. "The countries of Latin America hold the key to the world's development in the 21st century," Hashimoto told a joint news conference with Fujimori. "I have a very strong impression that Latin American is resuscitated," he said. Hashimoto and Fujimori, himself the son of Japanese immigrants, met for an hour at Government Palace before signing a loan package worth more than $600 million for hydroelectric, highway, drainage and recreational projects. Fujimori earlier put the figure at $500 million but the Japanese delegation said it was in excess of $600 million. Fujimori called Hashimoto "my personal friend" and awarded him the nation's highest decoration, the Order of the Sun. He also praised Japan for being one of the first supporters of Peru's reintegration into the world financial community after it become a pariah nation in the late 1980s because of its failure to pay its debts. He made a direct call, however, for an increase in Japanese investment, which lags behind the high levels of bilateral trade and direct aid. Japan is 12th on the list of direct foreign investors in Peru, with $43.83 million of investment since the government began keeping track in 1988. But Japan has become Peru's second largest trade partner after the United States, with a 1995 total of $490 million of exports from Japan to Peru and $455 million the other way. Hashimoto, for his part, praised Fujimori for positive changes during his tenure. "When I arrived in Peru I saw lights and young people walking freely in the streets, which shows an improvement in the country's security." Later on Tuesday, Hashimoto was due to meet briefly with some of the 100,000 Peruvians of Japanese descent, the largest Japanese community in Latin America after Brazil. Founded in 1899 by immigrants who came to work on sugar plantations, the Japanese community at first suffered economic marginalization and racism, particularly during the Second World War, but slowly became a potent economic and political force. Their most famous son, Fujimori, played on his image as an obscure "outsider" to ride a tide of disenchantment with traditional politics and carry off a shock 1990 presidential election defeat of world renowned novelist Mario Vargas Llosa. He swept to a second term in 1995 with 64 percent of the vote against former U.N. Secretary-General Javier Perez de Cuellar. Japan has been a key ally of Peru since Fujimori's 1990 election, pumping an estimated $900 million of aid and cooperation into a country where at least half of the 24 million inhabitants live in poverty. But Hashimoto's visit was only the second to Peru by a Japanese premier following Prime Minister Zenko Suzuki's trip 14 years ago. He was scheduled to leave on Wednesday for Costa Rica on the last leg of a 10-day tour that has also included Mexico, Chile and Brazil. 3898 !GCAT !GCRIM !GVIO An armed gang ambushed a caravan of state police in the troubled western state of Guerrero on Monday, killing at least one policeman, officials said. Police said the gang were common criminals not linked to the Popular Revolutionary Army (EPR), a mysterious new rebel group that has recently ambushed police and military patrols in the state. About 35 heavily armed men opened fire on police as they drove on a road a few miles (kilometres) south of the tourist resort of Acapulco, some 175 miles (280 km) southwest of Mexico City, police said. A gunfight continued for most of the day, killing a police commander and possibly two others, said Francisco Vargas Najera, the state police chief for Guerrero state. He said the gunmen were firing AK-47 automatic rifles. "The head of the police group was killed and apparently there may be two others dead as well," said Vargas. State police said later in a statement that one policemen was killed, one wounded and one was still missing. Vargas said the group were a gang of kidnappers operating in the region and that police were going to the area to carry out arrest warrants on the group. "They are criminals that we have identified," Vargas said. He added the gang wore neither the masks nor military fatigues that are the trademarks of the EPR. 3899 !GCAT !GCRIM Fugitive U.S. financier Robert Vesco, who has been on the run from U.S. justice for nearly 25 years, was sentenced to 13 years in jail by a Cuban court on Monday after being found guilty of economic crimes in Cuba. Vesco, now 60, had lived in communist-ruled Cuba out of reach of U.S. justice for the last 14 years. He was convicted on formal charges of crimes against Cuban economic plans and labour regulations, fraud and illegal economic activity. Havana's Popular Provincial Court handed down its sentence three weeks after a three-day public trial that exposed Vesco's role in a shadowy project to develop in Cuba an alleged plant-based wonder drug, known as TX, which its inventors claim is effective against serious illnesses like cancer and AIDS. Vesco's Cuban wife, Lidia Alfonso, who was tried with him on similar charges, received a nine-year jail term. Both have 10 days in which to appeal their sentences. The 13-year jail term for Vesco, who was arrested at his Havana home on May 31 last year, was lighter than the 20 years sought by the state prosecutor. The rogue financier, who is wanted in the United States for a $224 million mutual fund fraud and alleged cocaine trafficking, is known to be suffering from a urinary tract illness. The U.S. government, which has no formal diplomatic ties with Cuba, has said it would still like Vesco to be returned to U.S. justice, but Cuban officials insist that no formal extradition request has been received from Washington. During his trial in early August, the prosecution alleged Vesco systematically deceived Cuban officials and defrauded potential foreign investors in his efforts to have the TX drug produced in Cuba so that he could sell it abroad. The Cuban court, which consisted of a panel of five judges and no jury, also ordered Vesco to compensate the investors he was convicted of defrauding. These included businessmen from Italy, Switzerland and Colombia, whom Vesco allegedly duped out of several hundred thousand dollars. Vesco, who appeared thin and gray-haired during the three days of public hearings, denied the charges against him, arguing in his defence that he had acted in good faith and for the benefit of Cuba. Prosecution witnesses, who included senior officials from Cuba's Health Ministry and pharmaceutical industry, among them a nephew of President Fidel Castro, testified that Vesco misled foreign investors by making them believe that the TX medicine was already being produced in Cuba. In fact the drug, originally invented by a U.S. scientist and brought to Cuba by a friend of Vesco's, Donald Nixon Jr., nephew of the late U.S president Richard Nixon, was only in the experimental phase and had not gone through clinical trials. The court concluded Vesco had endangered the reputation of Cuba's secretive pharmaceutical and biotechnology sector, which is seeking to develop an international export market. Prosecution witnesses said Vesco, in his efforts to push the Cuban authorities into producing the drug, repeatedly claimed he had the high-level backing of the Cuban leadership. When Vesco was arrested in May 1995, the Cuban Foreign Ministry said he had been detained on suspicion of being a foreign agent provocateur and spy. The discrepancy between this and the formal charges eventually leveled against him was never explained. Cuban President Fidel Castro, responding last year to speculation that Vesco might be handed back to the United States as a sweetner for tense U.S.-Cuban ties, said then that it would be "immoral" to extradite him. 3900 !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto arrived late Monday in Peru on the penultimate leg of a 10-day Latin American tour intended to raise Japan's profile in a region dominated by U.S. influence. Hashimoto and his large entourage of ministers and businessmen flew in a private jet to Lima on Peru's Pacific coast from Brasilia where he earlier met Brazilian President Fernando Henrique Cardoso. Hashimoto was met at Lima's military airport by Peru's Foreign Minister Francisco Tudela and Prime Minister Alberto Pandolfi. On Tuesday he will meet President Alberto Fujimori, himself the son of Japanese immigrants, who rose from obscurity to defeat internationally renowned novelist Mario Vargas Llosa in 1990 presidential elections. Hashimoto will also visit members of the 100,000-strong Japanese community founded here in 1899 by immigrants who came to work on Peruvian sugar plantations. At first suffering economic marginalization and racism -- particularly during the Second World War -- the Japanese in Peru slowly established themselves as a quietly potent economic and political force. As well as Fujimori, who is nicknamed and refers to himself as "El Chino" or "The Chinaman" due to his Oriental roots, two ministers in his 14-man cabinet are from Peru's Japanese community, the largest in the region after Brazil. Hashimoto is expected during his visit to announce an economic aid and cooperation package to Peru worth several hundred million dollars. Japan has been a key ally of Peru's since Fujimori's 1990 election, pumping an estimated $900 million of aid and cooperation into a country where at least half of the 24 million inhabitants live in poverty. "The visit of Prime Minister Ryutaro Hashimoto to Peru constitutes a milestone in the two nations' bilateral relations that should begin a new stage," the Foreign Ministry said. It is only the second visit to Peru by a Japanese premier following Prime Minister Zenko Suzuki's trip 14 years ago. Since then, Peru has undergone a severe economic crisis that peaked with inflation of 7,650 percent and a 4.2 percent contraction of the economy in 1990; a vicious guerrilla war that has cost at least 30,000 lives and $25 billion in infrastrucuture damage since 1980; and radical political and free-market economic reforms under Fujimori. 3901 !E21 !E211 !E51 !E512 !ECAT !GCAT !GPOL Brazil's Lower House on Tuesday approved a bill reducing taxes on exports, congressional officials said. Deputies voted 303 to 70, with four abstentions, to approve the bill, which makes exports of primary commodities and semi-manufactured goods exempt from the so-called ICMS tax, the officials said. The bill also exempts from ICMS taxes purchases of machinery and equipment, as well as goods and services not directly linked to production, ranging from electrical energy to office supplies. Analysts said the measure could boost Brazil's annual exports by at least four percent and provide a shot in the arm to agriculture. The bill now must go to the senate, where government leaders were also pushing for a motion giving the proposal priority treatment, paving the way for a vote on Wednesday. -- James Craig, Sao Paulo newsroom 5511 232 4411 3902 !C41 !C411 !CCAT !GCAT !GPOL The Chilean government blasted the Senate's "disgraceful" rejection of Carlos Massad as a Central Bank board member and said it will weigh all its options after the surprise outcome. "This vote has been disgraceful," said Finance Minister Eduardo Aninat. "What we've seen here are petty vengeances, petty rivalries and petty politicking, an attitude that shows very little thought and which hurts me personally," he told reporters after the vote in Congress in Valparaiso. The Senate -- controlled by rightist opponents to President Eduardo Frei's government -- rejected by a vote of 21-20 Frei's nomination of Massad to the Central Bank's five-member board to replace Roberto Zahler, who resigned in June. Aninat, plainly shocked by the vote, signalled that the government would take its time before deciding what to do next. "The government is not going to act rashly. We're going to evaluate all our options," said Aninat, asked if officials would send a new nominee to Congress immediately. It was unclear if the government would seek another vote on the nomination. Aninat scorned the rightists' concerns that Massad was too close to Frei's Christian Democratic Party to guarantee the Central Bank's autonomy, saying what opponents really wanted was one of their own for the post. "The right wing wants a candidate to its own liking, which denies the independence of the Central Bank that they claim to want," said Aninat. Massad told reporters he accepted the outcome as "part of the legitimate political game." A former Central Bank president and health minister, Massad had been the government's hope to replace Zahler as Central Bank president. The five-member board chooses its president. The vote, a stinging political blow to Frei, underscored the problems he faces in the Senate controlled by a coalition of rightist parties and military appointees. --Roger Atwood, Santiago newsroom +56-2-699-5595 x211 3903 !GCAT !GPOL !GREL The Archbishop of Buenos Aires said on Tuesday the first thing he would do if elected president of Argentina would be to put up posters of the Ten Commandments in government offices. "They asked me what would be the first thing I would do if I were president, and I said the first thing I would do would be to resign straight away," Archbishop Antonio Quarracino said at a sermon attended by several cabinet ministers. "But before going, I would have big signs put up in all government offices, those to do with justice, in all sectors, with the Ten Commandments," he added. Argentina's top Roman Catholic cleric said the Biblical commandment "Thou shalt not steal" would get special emphasis "because it has to be about the most common thing these days." Quarracino and other Church leaders are regular critics of the government's free-market economic policy. 3904 !GCAT !GPOL !GVIO Guatemalan human rights groups said on Tuesday they wanted a new law to allow guerrillas a normal political life once final peace is agreed in the country's 36-year civil war. The future of the guerrillas is a theme being negotiated this week in Mexico, where the Guatemalan government and leftist rebels are continuing peace talks. It is widely believed the guerrillas seek to form a legal political party. Under current Guatemalan law, any involvement with the Guatemalan National Revolutionary Unit (URNG in Spanish) is considered treason. "The entire peace process and the need for legislation to allow guerrillas to reassimilate puts the Congress in a position of responsibility," Gustavo Meono, director of one foundation in the human rights alliance, told reporters. The coalition, called the Alliance Against Impunity, said it opposes a general amnesty for members of the military who commited human rights abuses. Likewise, under the alliance's proposed law, guerrillas who commited common crimes or crimes against humanity during the armed conflict would be denied amnesty as well. The alliance said it has presented its proposed law to government peace negotiators and the URNG and will take it to Congress next week. 3905 !GCAT !GPOL !GVOTE Nicaragua's leftist Sandinista Front on Tuesday added punch to its election ticket, saying respected lawyer Mariano Fiallos would be foreign minister under a future Sandinista government. The Central American country will hold presidential elections on Oct. 20. Fiallos, 63, was president of the powerful council that regulates Nicaragua's elections from 1984 until earlier this year when he resigned in protest against changes to the electoral process enacted by the National Assembly. The naming of Fiallos was made with a special eye to improving Sandinista relations with the U.S. government, which armed and trained right-wing guerrillas -- or Contras -- in an eight-year war against the Sandinista government in the 1980s. "(Fiallo's appointment) will allow the Nicaraguan people to have a foreign minister of undisputable prestige to guide relations with other countries, and in particular with the United States," former president and current Sandinista presidential candidate Daniel Ortega told a news conference. While still on the electoral council, Fiallos rejected repeated offers from Sandinista leaders to become the party's presidential candidate for this year's elections. Ortega then sought to run again. Fiallos is best known for guiding Nicaragua through its landmark 1990 elections which brought President Violeta Chamorro to power and ended nearly 11 years of Sandinista rule. Fiallos, a longtime Sandinista who currently sits on the governing council of the Interamerican Human Rights Commission, has a reputation for honesty and intelligence, and his presence at the helm of the 1990 elections gave them much needed credibility, analysts said. Fiallos said he accepted the Sandinistas' offer because the party offers "the only viable solution for a minimal amount of stability and non-confrontation in the Oct. 20 elections." Public opinion polls put Ortega second in the campaign, trailing Arnoldo Aleman of the right-wing Liberal Alliance by about 10 percent. 3906 !GCAT !GCRIM At least one person was wounded on Tuesday in a shootout between security guards and unidentified gunmen outside the home of a senior official of Mexico's Attorney General's Office, officials said. "There was an exchange of fire outside the home of Armando Salinas Torre, the private secretary of Attorney General Antonio Lozano Gracia," a spokesman for Lozano said. "It seems one of the security guards who looks after Salinas' wife was wounded." The spokesman said it was not yet clear if the incident was a deliberate attack on Salinas or his family. Lozano told a group of international journalists earlier on Tuesday that his office had received threats following the firing last week of 737 members of the Federal Judicial Police, the country's top police force, which is widely accused of drugs-related corruption. Lozano dismissed the threats as a "natural reaction" to the firings and said he had not stepped up his personal security. No more details of the incident were immediately available. 3907 !E21 !E211 !E51 !E512 !ECAT !GCAT !GPOL Brazil's Lower House voted Tuesday to give priority treatment to a bill that would reduce taxes on exports and proceeded to start voting on the proposal itself, officials said. Deputies agreed to make the bill a priority by 271 votes to 82. There was still a possibility that the actual vote on the bill could be put off until a special session Wednesday morning. Analysts say the bill could boost exports by as much as four percent by exempting them from the so-called ICMS tax. -- Michael Christie, Brasilia newsroom 55-61-2230358 3908 !C24 !CCAT !E51 !ECAT !GCAT !GENV Honduras will enact measures aimed at attracting $200 million of investment in renewable energy projects, a government minister said. "The energy cabinet approved a package of fiscal incentives to encourage local and foreign investment in projects for the generation of renewable energy," Public Works Minister Jeronimo Sandoval told reporters. "We hope to attract an investment of some $200 million to carry out hydroelectric, wind and biomass energy projects." The call for investment comes as Honduras is putting its state-owned electric company ENEE up for privatization. Sandoval said proposed incentives include eliminating import taxes for equipment and raw materials, reducing corporation taxes and eliminating or reducing surcharges. The proposal will be sent to the Honduran Congress within the next two weeks, where approval is expected, he said. Sandoval said several investors were interested in two hydroelectric projects, one in the central Patuca River basin and another at Cangrejal on the Atlantic Coast, as well as a wind power project at Cerro del Hula just outside Tegucigalpa and an unspecified biomass energy project. "If we complete these projects, in the next five years we'll generate an extra 500 megawatts of energy," Sandoval said. Honduras currently generates 600 megawatts of energy through four hydroelectric plants. "The generation of renewable energy will put us in a position of depending far less on (imported) petroleum and meet the future demand of private and industrial consumers," Sandoval said. --Gustavo Palencia, Tegucigalpa bureau, (504) 39 28 85 3909 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Paraguayan unions and peasant groups will stage their fourth national strike against President Juan Carlos Wasmosy's economic policies on Wednesday. The strike will last eight hours from 0730 local time (1130 GMT) and will include marches and demonstrations in the capital Asuncion as well as roadblocks on the country's main highways, union officials said. The unions and peasant groups, which demand a 26-percent pay rise, changes in economic policy and land grants to peasants, also plan a series of acts building up to a 72-hour general strike in November. The Wasmosy government aims to cut government spending and privatise. While these plans are stalled by accusations of government corruption and other problems, they still have unleashed fierce union opposition. Wasmosy's government has clashed regularly with unions since its election in 1993. There have been three general strikes since May 1994, with violence by both protestors and police increasing each time. This time, the government has said it respects the right to strike but will deploy 10,000 police to respond if protesters break the law or deviate from authorised routes for their marches. Union leaders say their members will respond to any police violence. Five demonstrators have died in the three strikes so far. 3910 !E41 !ECAT !GCAT !GJOB !GPOL A lower-house committee in Brazil's Congress on Tuesday failed to vote on the text of civil service legislation that would end job guarantees of public-sector workers. A meeting of the committee was suspended when a full session of the Chamber of Deputies began. Further meetings of the committee have been scheduled for Wednesday, though officials were unable to confirm whether they would take place. The government hopes the civil service reform will enable federal, state and municipal authorities to dismiss civil servants whose jobs are currently protected. -- William Schomberg, Brasilia newsroom 5561 2230358 3911 !GCAT !GCRIM Colombia will not be able to meet the ambitious drug crop eradication goal it set for this year, a government official said on Tuesday. Under heavy pressure from the United States to adopt stringent anti-narcotics measures, the government had pledged to wipe out more than 100,000 acres (40,000 hectares) of coca and opium poppies this year. But the official, who spoke on condition of anonymity, said the eradication programme had been adversely affected by this year's unusally heavy rains and by a revolt by coca growers in Colombia's impoverished south. "With respect to eradication, the goals will certainly not be achieved," the official said. Colombia's U.S.-backed eradication programme involves aerial spraying of illicit crops with the herbicide glyphosate. One problem with the herbicide, which could soon lead to its replacement with a granular substitute, is that rain causes it to wash harmlessly off coca leaves, so much of the coca sprayed this year may have been refined into cocaine and shipped abroad. Colombia is the world's leading exporter of cocaine and drug experts say it has also recently become the top supplier of heroin to the United States. Hundreds of thousands of peasants have staged mass protests across three southern provinces since early last month over the eradication programme. They argue that the government has failed to provide enough aid for crop substitution and that moves from illicit crops to legal ones should take place only gradually, not overnight. They also argue that herbicides fail to distinguish between coca and yucca or plantain and some charge the aerial spraying has a detrimental effect on children's eyesight. The government and military say the protests have been orchestrated by left-wing "narco-guerrillas" who make millions of dollars a year protecting rural drug operations and clandestine laboratories. If that is true, the guerrillas can be credited with organising what the press has dubbed the biggest peasant protest in Colombian history. "They (the rebels) have shown who's really in control in the south and it sure isn't the government," a Western diplomat said. 3912 !C42 !CCAT !E41 !E411 !ECAT !GCAT !GJOB Argentina's main labor federation CGT lashed out Tuesday at President Carlos Menem's assertions that the best way to combat rampant unemployment was more "labor flexibilization." "We cannot conceive a country without pensions, without social security for workers," CGT's spokesman Carlos West Ocampo told reporters after a trade union meeting. "Although in a country with no health care, pensions would be redundant as people would be dead" before reaching retirement age, he snorted. Menem, who was returning in the evening from a visit to South Eastern Asia, said the best way to complete his economic reform would be introducing more flexibility in labor legislation. Unemployment in Argentina is running at 17.1 percent after hitting a record 18.4 percent last year. The CGT, which earlier this month launched a 24-hour general strike against Menem's economic policies, plans a new, 36-hour walkout in September. "There are no negotiations or dialogue with the government" on the strike plans, West Ocampo said. -Guillermo Haskel, Buenos Aires newsroom, 541 318-0650 3913 !GCAT !GCRIM !GTOUR Violent crimes against tourists visiting Rio de Janeiro fell to a 10-year low in July, the Brazilian tourist police (DEAT) said on Tuesday. In some areas of Rio's Copacabana and Ipanema beachfront neighbourhoods, police recorded only one crime a day against tourists in July, compared with an average of 10 crimes a day in the past, DEAT official Rosangela Demetrio said. She said the drop in the crime rate was the result of police efforts to alert tourists to possible dangers before they occurred. "We cannot prevent tourists from associating with prostitutes, for example, but we can advise them how to look out for their money and their documents," she said. DEAT is also advising tourists not to flaunt cameras, jewelry or money. 3914 !E51 !E512 !ECAT !GCAT !GDIP Peru's first vice-president Ricardo Marquez said his country expects to sign a trade agreement with the Mercosur customs union by year's end. "We are in the process of negotiating with individual countries a list of products," Marquez said. "We hope to complete that in the next few months. Our goal is to reach an agreement with Mercosur by the end of the year." Marquez is visiting Brazil with a group of 30 Peruvian businessmen in hopes of boosting bilateral trade. He said an agreement with Mercosur would not mean Peru intends to leave the Andean Pact trade group. "There is no way we intend to leave the Andean Pact," Marquez said. Annual trade between the two countries now totals $600 million. Marquez said an agreement with Mercosur will raise that figure by 15 to 20 percent "in the short-term". Peru now exports mainly copper to Brazil and Brazil sells mostly motor vehicles and auto parts to Peru, officials said. Mercosur customs union includes Argentina, Brazil, Paraguay and Uruguay. -- James Craig, Sao Paulo newsroom, 55-11-2324411 3915 !GCAT !GCRIM Mexico is close to stamping out marijuana and opium poppy crops but faces a tougher battle eradicating police corruption, its top prosecutor said on Tuesday. Attorney General Antonio Lozano Gracia said the army could be rid of nearly all the marijuana and opium poppy plantations by next year. Opium poppies are used to make heroin. But he told a group of international journalists it could take as long as 15 years to clean up Mexico's corrupt main police force. "With regard to this problem of the Judicial Police ... it seems to me it is a problem that could be solved in 15 years, it can't be solved in four more years," he said. "We have to work on it every single day, and honestly, we have to change a culture, which I think is the biggest challenge a human being can set himself." Lozano, whose term runs until 2000, announced last week that he was firing 737 members of the 4,000-strong Federal Judicial Police, the country's most powerful police force and the one most widely accused of drug-related corruption, human rights abuses and common crime. The announcement caused alarm among Mexicans who feared that crime would suddenly jump with so many corrupt policemen on the streets and out of work. Lozano acknowledged those fears but said: "These gentlemen were already on the streets; they still are but at least they don't have their badges." Lozano, a member of the conservative National Action Party (PAN), is the only opposition politician in the cabinet of President Ernesto Zedillo, whose Institutional Revolutionary Party (PRI) has ruled Mexico since 1929. Lozano said 1996 would be a record year for destruction of marijuana and poppy plantations in Mexico, thanks to a developing relationship "of trust and unconditional support" between the Attorney General's Office and the army. "Supposedly in Mexico something like 55,000 hectares (136,000 acres) are sown (with illegal drugs). In 1994 we eradicated 27,000 hectares (66,700 acres), in 1995 36,000 hectares (89,000 acres), this year we will pass 40,000 hectares (99,000 acres), which puts us in a position that next year we can think of almost 50,000 hectares (124,000 acres)." "We are talking about the possibility, practically, of eradicating 100 percent," he said. He said the Attorney General's Office had transferred 18 helicopters to the army to help it spot illegal plantations, of which 60 percent are marijuana and 40 percent opium poppies. Mexico does not produce cocaine, although it is a major transshipment point to the United States. Despite the best relationship with the military in many years, Lozano said: "I have not received any pressure, from the U.S. government or anyone, to militarize the fight against drug-trafficking." Lozano took issue with the often-quoted figure that 70 percent of the cocaine entering the United States passes through Mexico -- a figure routinely given out by U.S. officials. "I don't agree with that figure ... we don't know what the figure is," he said. He said Mexican and U.S. officials were working on a joint analysis of drug-trafficking problems that would help produce a figure he would consider more reliable. 3916 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Chile's state copper company Codelco said it was optimistic that miners at its Salvador division would accept the corporation's pay offer in a secret vote Tuesday. "We are optimistic. The atmosphere has been excellent and the dialogue with union leaders has been very, very good," said division spokesman Luis Lodi. The result of the ballot at the pit, the smallest of Codelco's four copper mines, will be known at around 2230 local/0230 GMT Tuesday. Voting started Tuesday morning on the offer which includes a three percent pay increase in real terms and a new 36 month collective contract, said Lodi. If the miners reject the offer, a strike would start on September 1 when the existing contract expires. Salvador, which lies in the northern Atacama Desert, produced 42,901 tonnes of fine copper in the first six months of the year. -- Margaret Orgill, Santiago newsroom, 562-699-5595x212 3917 !GCAT !GCRIM !GVIO The Netherlands government has ruled out paying ransom money for a Dutch couple kidnapped from their farm, while Costa Rican authorities said on Tuesday they had no leads in the case. "We have not had contact with the kidnappers nor do we have any leads to take us to where they might be held," Chief of Judicial Police Manuel Alvarado told Reuters. Hurte Sierd Zylstra and his wife, Jetsi Hendrika Coers, both 50, were abducted from the teak plantation they managed late Saturday or early Sunday by at least two men demanding $1.5 million ransom, authorities said. Costa Rican officials on Monday had given different names for the couple. Anton Schutte, an official with the embassy for Belgium, the Netherlands and Luxembourg, said the Dutch government had ruled out paying any money in ransom. "We're looking at a criminal act that has no political aspect as far as what we can tell," Schutte added. A note with the ransom demand was left in the couple's car, which was used in the kidnapping, Schutte told a news conference on Monday. He said the note, believed to have been hand-written in Spanish and signed by the victims, was addressed to Ebe Huizinga, another Dutch citizen who owns the tree plantation. "Depending on you, we will either live or die," it said. Alvarado said the car was abandoned about 40 miles (60 km) north of the couple's house but said that did not indicate the kidnappers intended to take their victims into neighbouring Nicaragua. The farm is in the border region where a German tourist and a Swiss tour guide were kidnapped last New Year's Eve by a heavily armed band led by a former Nicaraguan guerrilla. The two were held for 71 days until relatives paid a ransom. Two of the suspected abductors have since been arrested. 3918 !C18 !C183 !C42 !CCAT !E12 !E41 !ECAT !GCAT !GJOB A swell of protest is growing within Venezuela's trade unions at the proposed year-end privatization of the state-owned holding company Corporacion Venezolana de Guayana (CVG), CVG union leaders said Tuesday. "We oppose the way the government is proceeding with the sale," Ramon Machuca, Sidor trade union Secretary General and member of union-based opposition party Radical Cause, told reporters. "We don't believe the government will make its timetable," he added. Sidor is the CVG's steel-producing arm, slated for a December sale worth an estimated $1.5 billion. The CVG's aluminum companies Venalum and Alucasa are also scheduled to be sold early 1997. Arguing that CVG's privatization would result in some 13,000 layoffs, compared to the government's estimated 1,500, CVG's union leaders told reporters they would strike and stage protests if their concerns were not addressed. "We oppose any privatization that hurts workers' welfare and does not take into account its social impact," they said. The opposition party Radical Cause controls all of the unionized workers at the CVG heavy industry complex and has systematically opposed all government legislation in congress. -- Omar Lugo, Caracas newsroom, 582 834405 3919 !E12 !E21 !E211 !ECAT !GCAT !GPOL The president of the budget and finance committee in Argentina's lower house of Congress predicted Tuesday that the legislature will pass the government's austerity measures largely untouched. "The project will not suffer major modifications," committee president Oscar Lamberto told the state news agency Telam after governing Peronist Party lawmakers from both houses of Congress met to decide on a common strategy to deal with the government package. He hinted that the wealth tax may be increased and that tax on entertainment will probably be scrapped "because it does not contribute significantly to raise revenue." The package was announced three weeks ago by new Economy Minister Roque Fernandez to help reduce Argentina's growing fiscal deficit. The measures are currently being examined in the budget and finance committee and should be passed on for debate in the chamber of deputies in 10 to 15 days. -- Daniel Helft, Buenos Aires Newsroom + 541 318 0663 3920 !GCAT !GVIO The pilot of a Cuban plane hijacked to the United States who chose to return to Cuba has been decorated for patriotism, state media said on Tuesday. Adolfo Perez Pantoja, 47, was given a medal for "vigilance and combativity" by the coordinators of Cuba's "Committees for the Defence of the Revolution," the neighbourhood committees that exist in every Cuban city, town and village. Domestic news agency AIN said the award was in recognition of his "exemplary conduct before the enemies of the Homeland." On Aug. 16, three Cubans armed with a revolver and knife forced Perez to fly his four-seater tourist taxi plane from an airfield east of Havana towards Florida. The plane ran out of fuel and crashed in the Gulf of Mexico, where the occupants were rescued by a Russian freighter and handed over to the U.S. Coast Guard. The three hijackers asked for political asylum in the United States but Perez asked to return to Cuba and flew back last Thursday. Havana, invoking existing bilateral immigration accords, is demanding the U.S. government return the three hijackers to Cuba to face justice there. But U.S. authorities say they plan to try the three for air piracy. 3921 !C12 !CCAT !GCAT !GCRIM The Brazilian city of Itabira has filed a lawsuit against state-owned Companhia do Vale do Rio Doce (CVRD) seeking more than 1 billion reais ($1 billion) in ecological and economic damages, a municipal official said Tuesday. The city of 85,000, located in Minas Gerais state, is economically dependent on CVRD, a mining company with one of its main iron operations there. "We are fighting for the survival of our municipality and for a better future," said Itabira's local government coordinator, Danilo Mota. "Ideally, we would like the government to give Itabira some of the privatization receipts from the sale of Vale or alternatively to bring new industry to the municipality to replace Vale," Mota said. At present, CVRD accounts for 85 percent of Itabira's ICMS export-tax receipts of 4 million to 4.5 million reais a month. Since 1991, the municipality also receives 500,000 reais a month in royalties from the company. CVRD would not comment on the legal action, saying it had not yet been notified officially. -- Simona de Logu, Rio de Janeiro newsroom, 5521 507 4151 The city is seeking compensation of 1.09 billion reais ($1.09 billion), a figure based on a survey of damage caused by CVRD's mining operations, which began in 1942, he said. The survey took into account air, ground and noise pollution, health risks to the local population, silting of water resources and the destruction of local scenery. Itabira is also concerned about its economic future, which looks dim once CVRD's iron-ore mines are exhausted in the next 25 years. 3922 !GCAT !GPOL !GVOTE The conservative opposition National Action Party (PAN) has maintained its lead in the first-ever electoral campaign for governor of Mexico City, according to a poll released on Tuesday. The private Indemerc Louis Harris polling firm said the PAN received support from 36 percent of the 600 Mexico City residents polled in August, down from 40 percent in May. The poll has a margin of error of 3.5 percent. The leftist Democratic Revolutionary Party (PRD) followed with 18 percent and the ruling Institutional Revolutionary Party (PRI) trailed with 13 percent. So far no candidates have been named to run in the historic election for governor of Mexico City next year. The election was created by constitutional changes promoted by President Ernesto Zedillo. In the past, the president appointed a "regent" or mayor of the Federal District of Mexico City, home to about 8.5 million people. Some 20 million people live in the greater Mexico City area. 3923 !GCAT !GODD Heavy drinkers in a Nicaraguan city were searching for someone who has covered them in "lovebites" while they were passed out in a drunken stupor, a local newspaper reported on Tuesday. The dreaded "chupabolos" -- "drunksucker" -- preys on men who have passed out in the streets of Matagalpa, 80 miles (130 kms) north of Managua, placing hickey-like "lovebites" on various parts of their bodies, El Nuevo Diario reported. Enraged drunks and street people in this town known for its machismo have organised a so-far unsuccessful search for the culprit who finds victims in the dark streets surrounding a local market. The total number of victims was still unknown. The first of the victims were two vagrants who slept in an abandoned car in front of a local bank, the newspaper said. In spite of the collective fear gripping Matagalpa's drinkers, local women expressed little sympathy. "Its just desserts for all the 'bolos' (drunkards) who sleep in the streets of our beautiful town," said a woman who worked in the local market. 3924 !E51 !E512 !ECAT !GCAT !GDIP Japanese Prime Minister Ryutaro Hashimoto on Tuesday met Peruvian President Alberto Fujimori and signed a $500 million loan package for hydroelectric and environmental projects in Peru. Fujimori, who wants his nation to emulate the Asian "tiger" nations, was expected to press Hashimoto during their meeting to encourage more direct Japanese investment, which lags behind the high levels of bilateral trade and direct aid. Japan is 12th on the list of direct foreign investors in Peru, with just $43.83 million of investment since the government began keeping track in 1988. Tokyo has, however, become Peru's second largest trade partner after the United States, with a 1995 total of $490 million of exports from Japan to Peru and $455 million the other way. After the signing of the loans, Fujimori -- himself the son of Japanese immigrants -- awarded Hashimoto the Order of the Sun, one of Peru's highest decorations. He also praised Japan for being one of the firmest supporters of Peru's reintegration into the international financial community after an economic crisis and failure to pay foreign debt made it a pariah nation in the late 1980s. "Here, we welcome a friend," said Fujimori. In the evening, Hashimoto was due to meet briefly members of the 100,000-strong Japanese colony in Peru - the largest Japanese community in Latin America after Brazil. Founded in 1899 by immigrants who came to work on Peruvian sugar plantations, Peru's Japanese community at first suffered economic marginalization and racism - particularly during the Second World War - but slowly established itself as a potent economic and political force. Their most famous son, Fujimori, played on his image as an "outsider" to ride a tide of disenchantment with traditional politics and carry off a shock 1990 presidential election defeat of the internationally renowned novelist and darling of the Peruvian elite, Mario Vargas Llosa. Fujimori, who is nicknamed and refers to himself as "El Chino" or "The Chinaman" due to his Asian roots, swept to a second term in 1995 with 64 percent of the vote in presidential elections also contested by former U.N. Secretary-General Javier Perez de Cuellar. Japan has been a key ally of Peru's since Fujimori's 1990 election, pumping an estimated $900 million of aid and cooperation into a country where at least half of the 24 million inhabitants live in poverty. It was only the second visit to Peru by a Japanese premier following Prime Minister Zenko Suzuki's trip 14 years ago. Since then, Peru has undergone a severe economic crisis that peaked with inflation of 7,650 percent and a 4.2 percent contraction of the economy in 1990, a vicious guerrilla war that has cost at least 30,000 lives and $25 billion in infrastructure damage since 1980, and radical political and free-market economic reforms under Fujimori. Fujimori's free-market "shock" therapy has tamed inflation and encouraged rapid economic growth, but it has failed to reduce high levels of poverty and unemployment. He has urged businessmen to look across the Pacific to markets like Japan and China as natural destinations for exports. Hashimoto was scheduled to leave Peru on Wednesday for Costa Rica on the last leg of a 10-day tour that has also included Mexico, Chile and Brazil. 3925 !E21 !E212 !ECAT !GCAT !GPOL A Brazilian Senate panel on Tuesday put off a vote on a bill authorizing a Brady bond buyback and debt-swap program after it became clear an agreement could not be reached over two alternative proposals. No new date was set for a vote by the Senate Economic Affairs Committee on the legislation. The two senators who have drafted alternative bills were asked by the committee president to seek a compromise. One of the proposals would limit any buyback and swap program to $5.0 billion, while the other would set no limit. Three months ago, the central bank requested Senate authority to restructure all of its $57 billion of Brady bonds. Senator Roberto Requiao, orginally appointed to draw up a draft bill, said he had not been convinced of the advantages of such operations. His proposed legisation would severely tie the central bank's hands. On Tuesday, another senator, Vilson Kleinubing, presented an alternative bill that would meet most of the central bank's demands while maintaining tight Senate control. -- Michael Christie, Brasilia newsroom, 55-61-2230358 3926 !GCAT !GPOL !GPRO Nicaraguan President Violeta Chamorro has excellent prospects for a complete recovery after surgery in the United States for a chronic spinal infection, her doctor said on Tuesday. "(Chamorro) underwent successful surgery on Monday for a chronic spinal infection called osteomyelitis. Her outlook for a complete cure is excellent," Dr. John Kostuik of the Johns Hopkins Medical Institute said in a statement. He said Chamorro was in good condition but she will require long-term antibiotic treatment. The cause of the infection was unknown. She was expected to be discharged in one week and will be able to return to Nicaragua in 10 days, the doctor said. Chamorro, 66, suffers from osteoporosis, a disease that weakens the bones, and has flown repeatedly to Washington for treatment. She will end her term in office in January after almost seven years as president. She stunned the world in 1990 when, campaigning from a wheelchair because of an ailment related to her present condition, she defeated former President Daniel Ortega of the leftist Sandinista party. 3927 !CCAT !GCAT !GENV The explosion of Western Europe's first Ariane-5 rocket on its maiden flight in June caused little environmental damage, space officials in French Guiana said on Tuesday. "Flight 501 was very bad from a technological point of view -- a failure in flight," Michel Mignot, head of the French Space Agency's (CNES) Guiana Space Centre, told a news conference. "It demonstrated the capacity of the space centre to predict the extremely limited impact on the environment and the lack of risk for the local population," he added. Reporters who flew over the mangrove swamp in a helicopter, where pieces of the rocket fell in burning fragments, saw that most of the destroyed vegetation had grown back in less than three months. But several patches of trees stripped of their foliage were still visible, the largest the size of a truck. CNES environmental officer Jean-Marc Andre said 37 toxic gas detectors were activated during the failed flight and revealed insignificant levels of hydrochloric acid in the atmosphere following the explosion. "Our instruments detected maximum hydrochloric acid levels at 0.05 parts per million (ppm). Legislation permits exposure at 5 ppm for 15 minutes and only exposure exceeding 50 ppm is considered to be a health hazard," Andre said. Environmentalists had warned that hydrochloric acid and alumina would damage flora and fauna in the Amazonian equatorial rain forest surrounding the space centre in Kourou, on the northeast coast of South America, and had called for the debut launch to be postponed. They said the risk came from the rocket's two solid fuel strap-on boosters that each burn 237 tonnes of fuel during the rocket's first 130 seconds of flight. The explosion was a major setback for Western Europe's effort to maintain its position as leader in launching commercial satellites, and to eventually launch a manned mission aboard Ariane-5 for Europe's participation in the international space station Alpha. The European Space Agency (ESA) has invested over eight billion dollars in the Ariane-5 programme over the last 10 years. France is the largest participant investing 46.2 percent of the total. The second Ariane-5 launch had been planned for next month but will now be delayed until March 1997 at the earliest. An inquiry board investigating the explosion concluded in late July that the failure was caused by software design errors in the rocket's inertial reference system. 3928 !C18 !C183 !CCAT !GCAT !GPOL A senior ruling Peronist Party congressman Tuesday rebuked the Economy Minister's top aide, Carlos Rodriguez, for publicly supporting the privatization of Argentina's Banco Nacion. "The best advice I can give the economy minister, for the health of the economy, is that he firstly rejects what that gentleman said and that he then makes him shut up," said Jorge Matzkin, Peronist leader in the lower house Chamber of Deputies, quoted by the private DyN news agency. Matzkin said deputies would vote against any bill to privatize the Banco Nacion or the Banco Hipotecario, Argentina's mortgage bank. Rodriguez, chief advisor to Economy Minister Roque Fernandez, said Monday it would be a good idea to privatize Banco Nacion, one of the country's largest banks. -- Jason Webb, Buenos Aires Newsroom +541 318-0655 3929 !GCAT !GDIP Czech Republic President Vaclav Havel is scheduled to make an official visit to Brazil Sept. 15-21, Brazil's Foreign Relations Ministry said on Tuesday. Havel is due to meet with his Brazilian counterpart Fernando Henrique Cardoso in the capital Brasilia and will visit the cities of Manaus, Sao Paulo and Rio de Janeiro. Also due to visit Brazil in September are South Korean President Kim Young Sam and German Chancellor Helmut Kohl. 3930 !E21 !E211 !E51 !E512 !ECAT !GCAT !GPOL The lower house of Brazil's Congress may vote later on Tuesday to give priority treatment to a bill cutting taxes on exports and on goods used in the manufacturing process, a congressional official said. Planning Minister Antonio Kandir, who drew up the bill when a deputy, was due to meet with representatives of state governments on Tuesday morning to explain how they would be compensated for losses from the exemptions from the ICMS tax. The official said that if agreement was reached in that meeting, a motion giving the bill priority treatment would be put to a vote in the Chamber of Deputies later on Tuesday. A vote on the bill itself might then take place on Wednesday. The bill, which would come into effect in 1997, is aimed to cut the cost of doing business in Brazil, improve the trade balance and kickstart the economy. The government has proposed to compensate states to the tune of 3.6 billion reais by reducing their debts with Brasilia. -- William Schomberg, Brasilia newsroom 5561 2230358 3931 !E41 !ECAT !GCAT !GJOB !GPOL A bill to reform Brazil's civil service, principally by doing away with job guarantees, was scheduled to be put to a vote in a lower house committee later on Tuesday, an official said. The so-called administrative reform would allow federal, state and municipal governments to dismiss qualified civil servants to bring spending on payrolls to under 60 percent of their net revenues, he said. The committee was scheduled to meet at 1100 local/1400 GMT and again at 1400 local/1700 GMT but the official said he did not know during which session the vote would take place. The reform, along with those of the pension and tax systems, is considered key to the long-term success of Brazil's economic stabilization program. States spend on average 80 percent of their revenues on pay, benefits and pensions. Under the terms of the text of the reform due to be voted Tuesday, qualified civil servants may only be dismissed once other categories of public sector employees have been reduced. The 60 percent limit must be reached by 1998. The government had originally wanted the adminstrative reform to include no restrictions on firing staff. But it recently reached a compromise with two major allies in Congress who had previously opposed including an end to the job stability of fully qualified civil servants in the text of the reform. -- William Schomberg, Brasilia newsroom 5561 2230358 3932 !C42 !CCAT !E41 !ECAT !GCAT !GJOB Private firms located in Sao Paulo state laid off 2,561 employees between August 12 and August 17, a spokesman for the Sao Paulo State Industries Federation (Fiesp) said. In the previous week, Sao Paulo's industries sacked 5,131 workers. Nine out of the 46 sectors included in the survey hired new workers and 18 sacked personnel in the period. Nineteen maintained their staff unchanged, he said So far this year, Sao Paulo industries have laid off 123,578 workers or 5.73 percent of the Sao Paulo's industrial workforce, the spokesman said. In the last 12 months, Sao Paulo firms have sacked 270,886 workers, or 11.76 percent of Sao Paulo's industrial workforce, he added. -- Alexandre Caverni, Sao Paulo newsroom, 55-11-2324411. 3933 !GCAT These are the highlights of the main Sao Paulo and Rio de Janeiro newspapers this morning. GAZETA MERCANTIL -- JAPAN ACCEPTS QUOTAS BUT WANTS MORE OPEN TRADE Japanese Prime Minister Ryutaro Hashimoto made it clear to President Fernando Henrique Cardoso that Japan considers Brazil's auto import rules incompatible with World Trade Organization statutes. -- LATINOS PREPARING $10 BILLION IN GLOBAL BOND ISSUES At least 46 new bond issues from Latin American issuers are in the pipeline and should be issued in global debt markets before the end of the year. -- AMERICAN EXPRESS TO NAME NEW PRESIDENT FOR BRAZIL American Express will name Robert Cavalcanti president of Brazilian operations in September. Cavalcanti is currently American Express president for Argentina. - - - O GLOBO -- SOAP OPERA MURDER TRIAL DELAYED IN RIO The sensational trial of two accused killers of soap opera star Daniela Perez was delayed to give the defense time to study new evidence. -- CARDOSO BLOCKS WAGE HIKES FOR JUSTICE WORKERS President Fernando Henrique Cardoso threw cold water on plans to raise the salaries of justice workers, saying there was not enough money in the budget. -- BIDS FOR RIO CELLULAR LINES EXTENDED Rio de Janeiro telephone company Telerj said it would extend the deadline for bids on 55,000 cellular telephone lines to Sept 13 from Aug 30. - - - FOLHA DE SAO PAULO -- UNEMPLOYMENT FALLS IN SAO PAULO Unemployment in Sao Paulo fell in July to 15.7 percent, after rising for five straight months, according to a survey by Seade/Diesse. -- John Miller, Sao Paulo newsroom, 5511 232-4411 3934 !GCAT !GOBIT !GPRO Alejandro Lanusse, the former dictator who ruled Argentina for two years, died at age 78 on Monday. Lanusse died after being brought to a hospital a week ago following a fall at home that resulted in a blood clot in the brain. He was operated on earlier in the week but failed to recover from surgery. The former dictator, who ruled from 1971 to 1973, was best known for allowing Juan Domingo Peron, Argentina's famed populist leader, to return to Argentina after 17 years of forced exile. Lanusse took over the leadership of the country after five years of dictatorship. But unlike his two predecessors, Juan Carlos Ongania and Marcelo Levingston, who ruled Argentina with an iron hand, Lanusse steered the country toward democracy. That resulted in general elections in March 1973 when the Peronists led by Hector Campora and Vicente Solano Lima returned to power. Lanusse was a candidate in the election but failed to defeat his old adversories and never returned to public office. He was imprisoned for four years in 1951 for taking part in a coup attempt to overthrow Peron led by General Benjamin Menendez. Lanusse's rule saw the gradual rise of left-wing activism which culminated in another period of brutal Argentine dictatorship from 1976 to 1983, during which the military launched its "dirty war" that resulted in 10,000 missing people. In his autobiography published in 1990, Lanusse described himself as a military man with "democratic ideas." He was born in Buenos Aires in 1918 and married Ileana Bell with whom he had nine children. He entered the Military College in 1935. 3935 !GCAT !GCRIM !GPOL !GVIO Mexico's Congress on Monday turned down a request by President Ernesto Zedillo to pick a new special prosecutor in the case of murdered presidential candidate Luis Donaldo Colosio. The decision killed plans by Zedillo to allow Congress to choose a prosecutor in the case after three successive presidential prosecutors failed to solve the 1994 killing, Mexico's worst political assasination in 50 years. The move also hands Zedillo and Attorney General Antonio Lozano responsibility for picking a replacement for ousted prosecutor Pablo Chapa Bezanilla, fired by Zedillo earlier this month after his main suspect in the case was set free. "We think it proper that the president, through his attorney general ... proceed with choosing who will be responsible for the investigation," Alfonso Molina Ruibal, a ruling Institutional Revolutionary Party deputy, said in a statement on behalf of fellow lawmakers. Legislators said they decided not to choose a new investigator after the leftist Democratic Revolutionary Party recently pulled out from the process, having said picking a prosecutor was the attorney general's job. Molina said individual lawmakers may still submit names to Zedillo as candidates for the job. Colosio was gunned down during a campaign rally in March 1994. As his replacement and eventual victor in the elections, Zedillo has been under pressure to solve the case as a test of his commitment to improving law enforcement. Frustration with the case grew this month after Othon Cortes Vazquez, the man prosecutors said was the second gunman in an elaborate conspiracy, was set free by a judge for lack of evidence. Another man, Mario Aburto Martinez, is serving a 45-year prison sentence for shooting Colosio in the head. 3936 !GCAT !GCRIM Fugitive U.S. financier Robert Vesco was found guilty on Monday of economic crimes by a Cuban court and sentenced to 13 years in jail. Havana's Popular Provincial Court handed down its sentence three weeks after a public trial that lasted three days. Vesco's Cuban wife, Lidia Alfonso, who was tried with him, received a nine-year jail term. The 13-year jail term for the 60-year-old Vesco, who was arrested at his Havana home on May 31 last year, was lighter than the 20 years which the state prosecutor had been seeking. The rogue financier, wanted in the U.S. on charges of embezzlement and drug-trafficking, lived in communist-ruled Cuba out of the reach of U.S. justice for the last 14 years. He was convicted by the Cuban court for his role in a mysterious project to develop an alleged miracle drug, TX, on the Caribbean island. During his trial in early August, the prosecution alleged he deceived Cuban officials and defrauded potential foreign investors in his efforts to have the drug produced in Cuba. 3937 !GCAT (Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW The Federal Government is likely within weeks to scrap its plan to elect half the delegates to its proposed constitutional convention on the republic and let the people directly choose the other half, as Government critics have been worried the election could fall prey to extreme and weird groups. Page 2. -- The Victorian Government, on a recommendation from Victorian Planning Minister Robert Maclellan, looks set to ban cinema operator Reading Australia's freestanding developments from Melbourne, following concerted opposition to the project and despite the initial reaction of the Government to welcome the US-owned company, and its planned A$80 million investment in the State, with open arms. Page 3. -- In a hearing in the District Court in Auckland today, the National Crime Authority is to confirm it has abandoned proceedings to extradite from New Zealand, former Equiticorp founder Allan Hawkins, who was accused of being part of a conspiracy to defraud Elders IXL. Page 3. -- The health industry and church groups have criticised the health and aged care cost-cutting measures contained in the Federal Budget saying they will create a two-tier system and will fail to create the necessary A$130 million in capital funding for nursing homes, as opinion polls in two newspapers yesterday showed that the majority of those polled supported the Budget and classed it as "fair". Page 5. -- THE AUSTRALIAN ACTU assistant secretary Bill Mansfield wrote a letter to the Australian Federal Politics Association on Friday accepting for the first time that the peak union body takes "part responsibility" for the violent breakdown of its rally at Parliament House lat week. The letter contradicted earlier statements by ACTU leaders concerning the riot. Page 1. -- Five generations of test cricketers joined thousands of fans at Bradman Oval in the New South Wales southern highlands town of Bowral on cricket legend Don Bradman's 88th birthday yesterday to pay tribute to "the Don" and to watch Prime Minister John Howard open the newly-extended Bradman Museum. Page 1. -- The National Report on Population Growth Ranking in Australia and New Zealand - an annual national snapshot of demographic trends, released yesterday - has shown Australians are sticking to the coastline more than ever before, but as small rural towns disppear, regional centres are absorbing many of the people from rural areas. Page 1. -- Under key recommendations to be made by a Federal Government advisory committee - appointed by the Government to advise on the implementation of the Budget surcharge on super for higher income earners - the generous superannuation payouts of politicians wuld be slashed. Page 1. -- THE SYDNEY MORNING HERALD After Federal Treasurer Peter Costello told a television audience the superannuation system would be reviewed, Finance Minister John Fahey was yesterday forced to move on the issue, saying lavish superannuation entitlements for Members of Parliament will be reviewed, with major changes possible to the system's funding and structure. Page 1. -- Environment Minister Robert Hill told the Herald yesterday the Federal Government is looking at merging the responsibilities of the Australian Nature Conservation Agency, the Commonwealth Environment Protection Agency and the Great Barrier Reef Marine Par Authority in a radical restructure that will reduce its sources of independent advice. Page 1. -- Following a decision by the Labor Party, the Australian Democrats and the Greens to use their voting majority in the Senate to block plans to overhaul the Higher Education Contribution Scheme, senior Government officials have warned university vice-chancelors their grants could be cut even further to plug a potential $1.13 billion hole in the higher education budget. Page 3. -- Following the Howard Government's decision to slash funding for the Australian Broadcasting Corporation, the ABC board has supported a radical restructuring of the national broadcaster that recommends running its radio and television divisions under a much leaner management. Meanwhile, ABC-TV's morning current affairs program First Edition has become the corporation's first casualty, and will end on Friday. Page 3. -- THE AGE According to Chief Justice of the Supreme Court of Victoria Justice John Harber Phillips, judges are ultimately best placed to make the final decision on sentencing as they have command and knowledge of a case. The Victorian Government is currently seeking public opinion on sentencing, especially on whether some sentences should be tougher. Page 1. -- The latest victims of the Federal Government's Budget cuts are the Australian Broadcasting Corporation's (ABC) Melbourne-based national television news program "First Edition" and afternoon news updates, after the ABC board yesterday approved a A$3.5 millon cut to news and current affairs which will see 30 per cent of jobs go in Melbourne's newsroom. Twenty-nine positions will also be shed nationally from State news, "Four Corners", "Lateline", "Foreign Correspondent", "Landline" and "Australian Story". Pge 1. -- The annual Coopers and Lybrand population report has found that Melbourne's population growth is recovering from the slump of the early 1990s, with fewer people heading interstate and more arriving from overseas. It also shows that the population drain frm the inner suburbs has reversed and shifted to the middle-distance areas, including Box Hill and Nunawading, which are losing more people than any other municipality in Australia. Page 3. -- A Melbourne study, which is the first to investigate aspects of pathological gambling including its affect on criminal activity, has found that one in 10 problem gamblers turn to crime in a bid to pay their debts and claims that 50 out of 120 problem gamblers attending an inner-city counselling service have a pathological problem, and 70 per cent are in debt of up to A$30,000. Page 3. -- Reuters Sydney Newsroom 61-2 9373-1800 3938 !GCAT (Compiled for Reuters by Media Monitors) THE AUSTRALIAN FINANCIAL REVIEW The APEC countries are preparing unprecedented agreements - aimed at mobilising capital and removing regulatory obstacles to the financing of large electricity projects - to encourage private companies to finance and build A$2 trillion in Asian public works over the next decade. A meeting in Sydney today is set to agree on key elements of the ambitious investment plan. Page 1. -- BHP chief executive John Prescott has become Australia's first executive earning over A$2 million-a-year, after receiving a A$300,000 pay increase in the year to May 31. He joined a select group of other executives, including Westfield's Frank Lowry, who already earned over that amount, but they are generally company owners or have received large retirement packages. Page 1. -- In order to boost the pace of its cable rollout, Optus Vision has put in motion a A$1.3 billion capital-raising, a substantial part of which will be done in the US high-yield market. Executives from BellSouth Corp, a 24.5 per cent shareholder in Optus Comunications, said yesterday in Atlanta that the Optus Vision cable-TV and local telephony business needed a major injection of capital, and this will also help to increase competitive pressure on rival Foxtel. Page 19. -- The Australian Stock Exchange yesterday committed itself to overhauling its own structure, with a radical plan to offer ownership of the bourse to the public. The proposal must be approved by a 75 per cent majority of 525 individual stock brokers, 98 broking firms and both Houses of Parliament and could result in the ASX listing its own shares on the sharemarket by late 1998. Page 19. -- Hardware, towage and engineering group Howard Smith Ltd reported yesterday that its net profit for the year to June was A$86.1 million, up from A$77 million last year, despite a 4.1 per cent fall in sales revenue to A$2.1 billion. Stockmarket investors aplauded the report sending shares rising 14 cents to A$8.75 in a generally weaker market. Page 21. -- Forestry group Auspine Ltd said yesterday that it had received a requisition to convene a shareholders meeting to settle a bitter board battle between directors of the company and remove Rod Hartley as chairman and appoint merchant banker Geoff Hill as a new director. Auspine is seeking legal advice on the validity of the requisition. Page 21. -- THE AUSTRALIAN Members of the Australian Stock Exchange will vote on a proposal to demutualise the Exchange into a publicly-listed corporation at a special general meeting, scheduled for October 18, after directors unanimously approved the release of an information package on the plan yesterday. Page 20. -- Argyle Diamond Mines Pty Ltd - which is 60 per cent owned by RTZ-CRA and 40 per cent by Ashton Mining Ltd and manages the world's biggest diamond mine - is attempting to lift the marketing profile for rough diamonds, yesterday launching a scathing attack on the De Beers-controlled Central Selling Organisation and the cartel's view of conditions in the profitable Indian market. Page 20. -- Due to the impact of funding cuts announced in the Federal Budget of A$2.8 million - to A$125.6 million in 1996-7 - the Australian Securities Commission's departing enforcement chief Andrew Proctor warned yesterday the Commission might be unable to pursue some important investigations. Page 20. -- Optus Communications is expected to resist pressure to include detailed financial information on cable associate Optus Vision and its sensitive subscriber numbers in the coming prospectus for its A$1 billion-plus public share offer. Page 20. -- Following a revised accounting treatment of an unrealised foreign exchange loss on internal loans, Emperor Mines Ltd's chief executive Colin Patterson said yesterday the gold miner had revised its annual net profit for 1995-96 by A$1.6 million to A$9.5 milion and bolstered gold reserves. Page 22. -- Dresdner Australia gold dealer Paul Lee said yesterday higher prices and renewed demand for gold have reinforced hopes for a strong rally in the near term. He said central banks and producers are delaying selling because they have a higher target. Page 22 -- THE SYDNEY MORNING HERALD In the face of declining sales revenue and the harsh downturn in the housing industry, Howard Smith has defied the odds by yesterday lifting annual net profits after abnormals to A$86 million for the 12 months to June, compared with A$81 million last year and predicting further growth this year. Page 25. -- The BHP annual report, released yesterday, has revealed BHP executive directors will soon be seeing cutbacks in performance bonuses. The report said the high bonuses paid in 1996 reflect results achieved the year before, and significantly reduced bonuses will be paid in 1997 to reflect the 1996 result. Page 25. -- Australian Competition and Consumer Commission chairman Allan Fels yesterday outlined details of last Friday's meeting between the ACCC, Australis Media and Optus Vision, saying both companies have been asked to provide further information to the Commission over their proposed satellite joint venture. Page 25. -- Metway Bank chairman Frank Haly and new chief executive Greg Moynihan said that despite the highly-competitive banking environment, the Queensland-based bank had managed to lift June year net operating profit before abnormals by five per cent to A$53.06 million. Page 27. -- The chairman of Australia's largest wholesale superannuation fund, Axiom Funds Management, Malcolm Irving, revealed yesterday the group had achieved a return of 11.6 per cent on its A$17.2 billion pooled fund in the 1995-96 financial year. He described Axom as "an attractive proposition to fund managers". Page 27. -- A week after brewing giant Lion Nathan confirmed its share of Australia's A$5 billion beer market had dropped by one percentage point to 42 per cent, recently-appointed marketing chief Tony Balfour handed in his resignation, "devastating" company executives. Page 27. -- THE AGE A week after the Federal Budget wiped out almost half of the Government's assistance to exports, the Australian Bureau of Statistics has reported that exports in 1995-96 topped 20 per cent of GDP for the first time in more than 40 years, with exports risig by 13 per cent to A$97.6 billion. But with the Budget reducing Government assistance to exports almost 45 per cent by 2000, Australian business now faces a critical test to sustain that growth. Page C1. -- Despite BHP reporting lower earnings, the company's latest annual report reveals that managing director John Prescott enjoyed a slight remuneration increase in the latest year to 31 May. Suggesting that BHP was sensitive to disclosures in the previous anual report about director's earnings, management this year has decided to disclose what directors would have got if bonuses had been paid in the year in which they were earned. Page C1. -- Howard Smith is hoping that recovery in the housing sector this year will spur its BBC hardware business into a powerful position to lead group profits, and the performance test of this lies ahead with a roll-out of 11 more stores in New South Wales and Vctoria this year. BBC hardware is already showing improvements due to changes in management, organisation and retailing policy. Page C3. -- Optus Vision's chief executive Geoff Cousins yesterday confirmed that the company's losses would widen in the second half on 1995-96 after announcing it had strengthened its programming line-up through an exclusive deal with WBTV - The Warner Channel. Pae C3. -- The after-tax profit of the electronic ticketing equipment group ERG has dropped by more than half to A$6.5 million in 1995-96, but the company said yesterday it was still looking to secure a massive British contract which could sharply boost its prospects. Page C3. -- Metway Bank reported a 17.3 per cent reduction in profit to A$41.7 million yesterday covering the year to June, but the poor result masked a positive turnaround in crucial indicators of the bank's efficiency. The result was adversely affected by a previously announced A$11.3 million abnormal charge relating to a bank accounts debit tax dispute with the Queensland Government. Page C3. -- Reuters Sydney Newsroom 61-2 9373-1800 3939 !GCAT **BIRTHDAYS** German poet JOHANN WOLFGANG VON GOETHE was born in 1749. Pioneer vigneron JOHANN GRAMP was born in Bavaria in 1819. After migrating to Australia he set up business at Jacob's Creek in South Australia. The vineyard was a success and produced a major national wine label. Russian writer COUNT LEO TOLSTOY, who wrote "War And Peace" and "Anna Karenina", was born in 1828. Author VANCE PALMER was born in Bundaberg in Queensland in 1885. He was a novelist, playwright and poet. Labor politician ARTHUR CALWELL was born in West Melbourne in 1896. He had a long and stormy politicial career. He was credited with being the architect of Australia's post-war immigration policy. He survived an attempted assassination in 1966 outside Mosman Town Hall. French actor CHARLES BOYER was born in 1899. American dancer, singer and actor DONALD O'CONNOR was born in 1925. He starred in musicals as a child and had a long and varied career. American actor and singer DAVID SOUL (SOLBERG) was born in 1943. He played 'Ken Hutchinson' in the television series "Starsky and Hutch" from 1975 to 1979. After his success as 'Hutch' he had a hit in 1976 with "Don't Give Up On Us", and in 1977 "Going In With My Eyes Open", "Silver Lady" and "Let's Have a Quiet Night In". One of the OSMOND brothers, WAYNE, was born in 1951. He played the guitar and the saxophone with The Osmonds. British singer with the duo Mel and Kim, KIM APPLEBY was born in 1961. Hits with her sister Mel included "Showing Out" (1986), "Respectable" (1987) and "That's The Way It Is" (1988). Mel died of cancer in 1990, at the age of 24. **EVENTS** 1850 : The Channel telegraph was laid between Dover and Cap Gris Nez. 1879 : Cetewayo (or Cetshwayo), last of the great Zulu kings, was captured by the British at the end of the Zulu War. 1903 : The Victorian government declared Melbourne Cup day a holiday, but only for those who lived in the city. 1914 : The first big naval encounter of World War One took place between British and German ships off the North Sea island of Heligoland. The Germans lost three ships and 1,000 sailors; British casualties were 33 killed. 1922 : The first ever radio advertisement, a 10-minute property commercial by Queensboro Corp, was broadcast by station WEAF in New York. 1933 : The Brisbane "Courier Mail" newspaper was formed out of a merger between the "Brisbane Courier" and the "Daily Mail". The morning newspaper is the city's only remaining daily. 1941 : Australia's Prime Minister ROBERT MENZIES resigned, handing over the country's top job to ARTHUR FADDEN. MENZIES' resignation followed the Labor party's rejection of his offer of an all-party government. A little over a month after the resignation, the government was defeated in a no-confidence motion, and Labor's JOHN CURTIN became Prime Minister. 1945 : The Liberal Party was formally inaugurated in Sydney. 1954 : In a sensational case in New Zealand, two schoolgirls were convicted of murder. The victim was the mother of one of the girls, 16-year-old PAULINE PARKER. Her accomplice was 15-year-old JULIET MARION HUME. They were found guilty of murdering HONORA PARKER by bashing her with a brick, after the pair learnt of plans to separate them. Police said PAULINE PARKER outlined the murder plan in her dairy and called it "the happy event" and described the eve of the murder as "sort of night-before Christmassy". They were the youngest people to be convicted of murder in New Zealand. 1963 : The Reverend MARTIN LUTHER KING JR delivered his "I have a dream" speech to 200,000 civil rights demonstrators who had marched on Washington. 1967 : The inventor of the board game of Monopoly, CHARLES DARROW, died. 1988 : Three jet planes belonging to the Italian air force aerobatics team collided at an air show in West Germany, killing 33 people. The aircraft were performing a complicated manoeuvre in front of a crowd of 300,000 at the US Air base at Ramstein. 1990 : Four of Britain's biggest businessmen were found guilty of theft and conspiracy to defraud. Former chairman of Guinness, ERNEST SAUNDERS, chairman of the Heron company, GERALD RONSON, Britain's second biggest private company financier Sir JACK LYONS and stockbroker ANTHONY PARNES were involved in an illegal share-fixing operation to ensure that Guinness won its takeover bid for the Distillers company. LYONS, PARNES and RONSON each received "thank you" payments of close to $10 million each. (Compiled from ABC ARCHIVES, ABC RADIO NATIONAL, "On This Day" published by REED INTERNATIONAL BOOKS LIMITED, "The Chronicle Of The 20th Century" published by PENGUIN BOOKS and "Rock And Pop (Day By Day)" published by BLANDFORD BOOKS) -- Reuters Sydney Newsroom 61-2 9373-1800 3940 !GCAT THE DOMINION Front Page - Fugitive not exploited', Holmes reject critics - Peters fails to stop changes to surcharge - Hijack ends peacefully in Britain - Blumsky wants to fete rugby heroes Page two - Bolger to meet Dalai Lama Editorial - Cull the seals, by hoki Business - Forestry Corp posts $168m profit - TVNZ increases half-year profit by 46.7pc - Air NZ buy into Ansett imminent - SpringBoks dump Stransky NEW ZEALAND HERALD Front Page - Police outrage as babies killed - I was doing my duty - Holmes lashes out - Live cover for All Blacks return Page 3 - Net cast overseas for 600 teachers - Kiwi Air to shed jobs for savings Editorials - An end to ACC rorts Sport - Stop your whingeing Morne - Marsden point prepares for expansion - Inflation still a danger Business - Brierley linked to successful Works bidders CHRISTCHURCH PRESS Front Page - Party backs army style works scheme - Chechnya truce - Holmes defends meeting with fugitive - London hijack ends peacefully - NZ exporters told to aim for US market - CHE wipes policy to charge undertakers Editorial - Depending on the state Business - Asian firm buys works - Telecom prepares to link households to future 3941 !GCAT !GREL !GVIO Three Australian Catholic nuns held captive for 10 days by rebels in south Sudan have told a mediator seeking their release they believe their freedom is imminent, a senior Sudan-based church official said on Tuesday. The nuns, aged between 52 and 73, are being held with three other missionaries by the Sudan People's Liberation Army (SPLA) rebels at Mapourdit, in the mainly Christian and animist south, where the nuns taught at a school. "Yesterday they were allowed for the first time to speak to a member of a non-government organisation," Monsignor Caesar Mazzolari said in a radio interview aired in Australia on Tuesday night. "They feel that the resolution to their situation may come within hours, within maybe a day or two," he told the Australian Broadcasting Corporation from Sudan. Some of the six missionaries have been accused by the rebels of spying and being agents of Islam because of a quotation from the Koran found by the rebels on a bookmark in a Bible belonging to the nuns, Mazzolari said. "It's unbelievable that the sisters taught Islam," he said. The SPLA has yet to comment. It is fighting Khartoum's government forces in the south for greater autonomy or independence from the Moslem north. Sisters Moira Lynch, 73, Mary Batchelor, 68, and Maureen Carey, 52, are held at a missionary compound in Mapourdit with American Father Michael Barton, 48, Sudanese Father Raphael Riel, 48, and Italian Brother Raniero Iacomella, 28, church and Australian foreign ministry sources said. The nuns may have resisted efforts by the rebels this month to recruit some of the school's 1,500 students to their cause, Mazzolari said. "They may have resisted the recruiting because they had been assured they (the rebels) would not come to the school," he said. Earlier, the foreign ministry in Canberra said the accusations against the missionaries were bizarre. "These reports (of the spying charges) are a matter of great concern," a ministry official told Reuters. Australian diplomats in Nairobi, capital of Kenya neighbouring Sudan, are working with the Catholic church in southern Sudan and with U.S. and Italian diplomats to free the missionaries, the official added. The three nuns are members of the Daughters of Our Lady of the Sacred Heart order. They and the other missionaries had been held by the rebels since August 17, Mazzolari said. Nuns from the order in Sydney were distressed by the reports of the spying charges on Tuesday and were "just trying to get some space to say some prayers", a Catholic church spokeswoman in Sydney said. A senior member of the Sydney order of nuns will fly to the Kenyan capital, arriving there on Friday, "to see if she can help at all", the spokeswoman said. News of the spying charges emerged after a weekend attempt to secure the release of the missionaries failed, the Australian foreign ministry official said. A plane was to have met the missionaries and their captors near Mapourdit at the weekend under an arrangement agreed between the rebels and Sudanese priests, the official said. "But they were not waiting for them as arranged," he said. The official expressed concern for their health. "They are quite elderly... We are concerned about their health, no question about that," he said. 3942 !GCAT !GDIP The treasurer of the Australian state of Victoria, Alan Stockdale, said on Wednesday that Victoria could stand as a model for Asia-Pacific nations seeking to privatise their power industries. Stockadale told an Asia-Pacific Economic Cooperation (APEC) zone energy ministers meeting in Sydney that Victoria had so far sold off A$13.6 billion in electricity assets into private hands as part of a wide-reaching power reform programme. "Many APEC nations are either on the verge of or currently underway in a process of inviting private-sector involvement in their power industries," Stockdale said. The need for energy reforms in the APEC region is "simply awe-inspiring," he said. Much of the new demand for energy in the APEC region would come from China and India, although all APEC economies faced similar pressures to expand energy capabilities, Stockdale said. "These levels of growth can be expected to outstrip the organisational and financing approaches traditionally employed in Asian utilities," he said. Ministers from the 18 APEC nations are meeting in Sydney with representatives from private businesses over ways to tackle forecast growth in energy demand in the region of 3.3 percent a year to 2010. Victoria was gaining expertise in privatising power assets as a result of its reform programme, Stockdale said. Countries seeking to reform their energy sectors should unbundle their state monoliths, establish clear legal and regulatory frameworks and design trustworthy tendering methods to attract international investors, he said. -- Sydney Newsroom 61-2 9373-1800 3943 !GCAT !GVIO Australia expects six Catholic missionaries, including three Australian nuns, who have been held by rebels in Sudan for almost two weeks to be freed within a few days, a senior Australian diplomat said on Wednesday. "I am fairly confident (of their release)," Australia's chief envoy to neighbouring Kenya, John Trotter, said in a radio interview aired in Australia on Wednesday. "I can't say I am 100 percent (confident), but I am pretty hopeful it will occur, yes. It won't necessarily occur tomorrow or the next day, but within the next two or three days," said Trotter, Australia's high commissioner in Nairobi. Australian Broadcasting Corp radio said the interview was recorded early on Wednesday morning, after a Kenya-based Sudan People's Liberation Army (SPLA) official said the rebel group's leadership was trying to secure the missionaries' release. "The disciplinary system of the SPLA is such that an order coming from this level of the hierarchy will be obeyed," Trotter said. The three nuns, an American priest, an Italian brother and a Sudanese priest have been held by SPLA rebels at Mapourdit, in Sudan's mainly Christian and animist south, since August 17. The SPLA has fought Khartoum government forces in the south since 1983 for greater autonomy or independence from the Moslem, Arabised north. The missionaries' captors accused some of the group of being spies and agents of Islam after the rebels reportedly found a quotation from the Koran on a bookmark in a Bible belonging to the nuns, Catholic church sources in the region have said. The nuns, who were teaching at a school in Mapourdit when they were taken captive, may also have tried to resist an effort by the rebels to recruit students to their cause, they said. The United States on Tuesday said it had urged the SPLA to ensure the rogue rebel leader holding the missionaries at Mapourdit freed the group immediately. "We remain very concerned for the safety of the American citizen and the other missionaries, and we call upon the SPLA to take all necessary measures to guarantee their safety and effect their immediate release," a State Department spokesman said. George Garang, Nairobi spokesman for the SPLA, said on Tuesday it was urgently trying to contact SPLA commander Nuour Marial at Mapourdit. "The movement is making arrangements for them to be set free. This is a decision of the leadership," Garang said. Sisters Moira Lynch, 73, Mary Batchelor, 68, and Maureen Carey, 52, are being held at a missionary compound in Mapourdit with American Father Michael Barton, 48, Sudanese Father Raphael Riel, 48, and Italian Brother Raniero Iacomella, 28, church and Australian foreign ministry sources said. 3944 !GCAT !GCRIM An elderly Australian man on Tuesday appeared in court charged with 850 child sex crimes in Australia after earlier being charged with committing similar offences in Bangkok. The 75-year-old man, whose name can not legally be released, faces charges of indecent dealing, sodomy and permitting sodomy with eight children between the 1960s and 1980s. The eight children were aged between 13 and 16 at the time of the alleged offences, the Brisbane Magistrates Court heard on Tuesday. Police from the Child Exploitation Unit told the court they expected more charges to be laid. In May, the same man became the second Australian to be charged with sex offences against children in an overseas country, the court was told. The man was then charged with two counts of sexual conduct involving a child under the age of 16 and one of possessing four rolls of film depicting child abuse acts. It was alleged he had sex with a girl and a boy in Bangkok between 1994 and 1995. The charges were brought under Australia's tough child sex tourism laws which allows nationals to be charged at home for child sex crimes committed overseas. The man, who is in custody on remand from the May charges, will appear again in court on September 9. 3945 !GCAT NIHON KEIZAI SHIMBUN Japan's second-largest glass maker, Nippon Sheet Glass Co Ltd, has mapped out a management restructuring plan reducing the number of executive positions to 150 from 400. It also plans to set up an in-house computer network system by the end of this year to expedite decision-making. ---- The Export-Import Bank of Japan has rejected applications from General Motors Corp and Chrysler Corp for low-interest loans. The U.S. carmakers want to build facilities to make vehicles for export to Japan. ---- Japanese consumer electronics makers including Toshiba Corp, Matsushita Electric Industrial Co Ltd, Hitachi Ltd and Pioneer Electronic Corp are to start selling digital video disc players (DVD) in late October. The players will cost at around 70,000 yen. Sony Corp plans to postpone marketing DVD players until next spring. ---- Andersen Consulting, a Tokyo-based unit of the international consultancy, plans to offer an information system, accounting and other back-office services to companies seeking to outsource such operations, from September. It hopes to gain 1.3 billion yen sales in the fiscal year to August 31, 1997. ---- Konami Co Ltd plans to build a three billion yen production plant in Kobe in September, to turn out business game machines and equipment. It hopes to target a rise of 34 percent in sales of game machines to 16 billion yen in the fiscal year ending March 1997 compared with the same period a year earlier. 3946 !GCAT !GCRIM !GPOL A relative of Chinese dissident Chen Longde said on Tuesday Chen had been beaten twice by officials in a labour camp and that he jumped from a third-floor window because he couldn't stand it any more. He was seriously injured in the fall and is now in hospital. But a local justice bureau official said prison staff had in no way acted improperly and said Chen's attempted suicide was "an individual act". Chen was sentenced last month to three years in a labour camp for "endangering national security" by sending a petition to parliament in May demanding the release of political prisoners. Chen's brother-in-law, surnamed Ning, said by telephone from the east China city of Hangzhou that the family had visited Chen on Tuesday morning and found him in low spirits with a broken right leg and three teeth smashed. He quoted Chen as saying that he had been beaten on August 15 by a prison official surnamed Tang after refusing to write materials on his case as requested by officials. On August 17, he said Tang beat him again this time with an electric prod. "He said he just couldn't stand it any more so he jumped," Ning said. "The actions of the officials were in no way extreme," said an official from the Zhejiang provincial Justice Bureau contacted by telephone. "It was a part of the normal work. Chen's attempted suicide was an individual act." Ning said doctors told him Chen would have an operation on Wednesday and would probably have to spend three months in the hospital. "We're very angry. The law is clear that this sort of action cannot be taken even against prisoners," Ning said. Chen's elder sister, Chen Xiaoying, said the family received word of the incident on Monday and were outraged that the police waited for nine days before informing them of Chen's injuries. Chen, aged 39, was detained on May 28 this year and sentenced to three years reform through labour in late July. He was jailed previously for three years for his role in student-led democracy demonstrations crushed by the army on June 4, 1989, in Beijing. 3947 !GCAT !GDIP Taiwan's New Party launched exploratory talks on Tuesday with political groups in Hong Kong in a bid to strengthen contacts before China resumes sovereignty over the British colony next year. The party, a pro-unification group which split from Taiwan's ruling Nationalists, said it would use its four-day visit to talk both to pro-China and pro-democracy groups. New Party members said that before Hong Kong's transfer to mainland rule in mid-1997, Taiwan would need to amend its laws regarding Hong Kong, but present links could hopefully be maintained. China regards Taiwan as a renegade province since defeating the Nationalists in a civil war in 1949 and driving them into refuge on the island. China put on a show of military strength near Taiwan this year, stoking fears of a war. With Hong Kong reverting to China on July 1, and with growing concern in Beijing over pro-independence sentiment in Taiwan, the British colony's relations with Taiwan have become a sensitive issue. Hong Kong's transition is widely regarded as a litmus test and precursor for Taiwan's eventual reunification with the mainland. Hong Kong Democratic Party legislator Edward Ho, who met the Taiwanese politicians on Tuesday, said the talks were not aimed at undermining China's resumption of sovereignty over Hong Kong or reunification with Taiwan. "We are not forming a political organisation across the territories of Hong Kong and Taiwan to subvert China," Ho said. "We are Chinese; we share the belief there should be one country and there should be peaceful reunification between China and Taiwan. "Obviously this is a topic of common concern and interest. So it is right and legitimate for us to continue to have contact and dialogue." 3948 !GCAT !GDIP !GPOL !GVIO A leader of Hong Kong's democracy movement warned on Tuesday that Hong Kong people might rise up in revolt against China if Beijing tried to impose iron rule after resuming sovereignty over the British colony in 1997. After more than 150 years as a British colony, the bustling capitalist territory of 6.2 million people becomes an autonomous part of communist China on July 1. Pro-democracy legislator Emily Lau, an outspoken critic of both China and Britain, said that if China began locking up dissidents and gagging the press in Hong Kong after the handover, rebellious sentiment would grow. "Look at the way (Beijing) deals with some dissidents in China -- arrest them, release them and then arrest them," Lau told Reuters Television in an interview. "Not only that, they freeze their bank accounts, and that's really something very serious," said Lau, an independent who co-founded a new democracy grouping, the Frontier, this week. "But I hope that would not happen in Hong Kong. As I said, the harder the pressure the more may be the sense of rebellion," she said. "If things go very wrong, and maybe human nature being what it is, the harder the suppression the more the people may be prepared to rise up." Lau, who holds a British passport and has the right to live in Britain, said she would not leave Hong Kong unless she and her family were placed in personal danger. "If things should become very difficult, should I myself and my family come under personal danger, I may consider leaving." If she left Hong Kong, she would become ineffective as a fighter for democracy in the territory, Lau said. "You will be more effective from within, because once you are outside Hong Kong, outside China, you are just a voice out in the wilderness," she said. Lau said the Hong Kong business community should speak out on issues of democracy, human rights and the rule of law, as China would only listen to "the rich and the powerful". They should "ask Beijing to exercise maximum restraint so as to enable Hong Kong to enjoy a high degree of autonomy". 3949 !GCAT !GCRIM !GPOL A lawyer for ousted Indonesian Democratic Party (PDI) leader Megawati Sukarnoputri said on Tuesday talks aimed at an out-of-court settlement with the government and political rivals had been put off to Wednesday. R.O. Tambunan told Reuters lawyers from the parties involved had planned to meet on Tuesday night but the discussions had been put off until Wednesday. A suit brought by Megawati against government officials and PDI rivals is due to resume in Central Jakarta District Court on Thursday if talks fail. 3950 !GCAT !GDIS Ten people were missing after a fishing boat collided with a passenger liner and sank off China's northeastern province of Liaoning, state radio said on Tuesday. The fishing boat sank and its entire crew was missing after a collision with the "Tiantan" liner off the port of Dalian early on Monday, the report said. It said the liner was heading to Dalian from the northern port of Tianjin, it said. Dalian port officials, contacted by telephone, confirmed the collision but gave no further details. 3951 !GCAT !GDEF China, locked in territorial disputes with several countries, would strengthen its naval defences to protect its maritime rights, the Liberation Army Daily said on Tuesday. "We should...implement what President Jiang (Zemin) and Premier Li (Peng) have repeatedly stressed about strengthening national defence," the newspaper said. Over 80 percent of international trade still relied on sea transport and every year 3.7 billion tonnes of merchandise were transported by sea, it said. Many coastal countries had increased spending on their navies to protect and extend their maritime rights, the newspaper said, adding that the sea would soon become the major cause of regional conflict. Vietnam has increased the proportion of its navy relative to the army and air force to nine from six percent, it said. Japan's navy had recently extended its patrol from coastal waters to 1,000 nautical miles. Russia also planned to strengthen its defence of coastal waters and maintain its naval capability while India planned to tighten control over the Indian Ocean, it said. While the threat of a third world war had decreased, the number of regional wars and armed conflicts had risen, the newspaper said. Of these the most intense and hard to resolve had been over marine rights. On Monday, China said that it wanted a peaceful resolution to the dispute ovder the Spratlys Islands, a cluster of potentially oil and mineral-rich isles in the South China Sea. The islands are claimed wholly or in part by China, Taiwan, Vietnam, Brunei, Malaysia and the Philippines. 3952 !GCAT !GDEF !GDIS A Cambodian army helicopter, with up to 17 people on board, crashed in a remote jungle in central Cambodia but there was no immediate word on casualties, an armed forces spokesman said on Tuesday. The Russian-made M-17 went down about 150 km (90 miles) north of capital Phnom Penh on Sunday while on a routine resupply flight to the northern province of Stung Treng, General Chum Sambath told Reuters. The cause of the crash was not known and authorities were not ruling out the possibility that the helicopter could have been brought down by Khmer Rouge guerrillas, who are known to operate in the area. One government official said a regional army commander was on board but Chum Sambath said it was not clear exactly how many people were on board the helicopter or who they were. A resuce team was on the way to the crash site near the Phnom Chi mining district, he said. The aircraft was flying ammunition to northern Cambodia when it crashed and none of the personnel on board were involved in negotiations with a dissident faction of the Khmer Rouge guerrilla group, officials said. Senior army officers have in recent days been flying in and out of a northwestern guerrilla zone to push ahead peace talks with the dissident Khmer Rouge faction which broke away from the main rebel group earlier this month. 3953 !GCAT !GDIP !GREL Beijing has called on Seoul to stop South Korean missionaries from travelling to China, a South Korean embassy spokesman said on Tuesday. The appeal was made on Sunday during talks between South Korean deputy Foreign Minister Lee Ki-choo and his Chinese counterpart Tang Jiaxuan, the spokesman said. It is not known why China raised the issue. Atheist China officially bans missionary activities but often turns a blind eye to religious activities of people nominally employed as foreign language teachers, particularly in remote areas that are unable to attract other candidates. 3954 !GCAT !GDEF China plans to install a computer network linking its military academies to improve its fighting capability through the better use of data, the Xinhua news agency said on Tuesday. "Chinese military leaders have realised the importance of information resources in modern warfare," Xinhua said. China aimed to put information from the libraries of every military academy on the network by the turn of the century, Xinhua quoted an official at the International Federation of Library Associations as saying. "Computer technology is crucial for victory in the electronics and information wars," it said. Computer experts had been working at the National Defence University to develop network software since March 1995, it said without giving further details. 3955 !C42 !CCAT !E41 !ECAT !GCAT !GJOB The number of Filipinos going to work in the Middle East fell by 9.83 percent in the first half of 1996 due to tougher recruitment laws, the Philippine Overseas Employment Administration (POEA) said on Tuesday. A total of 326,523 Filipinos went to work in Gulf states in first six months of the year, down from 362,107 in the same period last year. POEA deputy administrator Tito Genilo said the new law prescribed harsher penalties for illegal recruitments, especially of women. "A skilled and informed worker is our best protection against exploitation," Genilo said in a statement. About four million Filipinos work abroad and their remittances are an important source of foreign exchange. But most are employed in menial jobs and recent cases and allegations of exploitation has made the country cautious about allowing workers to go overseas. Last month, teenage maid Sarah Balabagan returned home from the United Arab Emirates after escaping a death sentence for killing her employer, whom she had accused of rape. 3956 !GCAT !GPOL !GVOTE The chief minister of Malaysia's Borneo state of Sarawak has been returned to the state assembly unopposed, the Elections Commission announced on Tuesday. It said that Abdul Taib Mahmud's Barisan National coalition had won 19 seats uncontested out of 62 up for grabs in state assembly polls on September 7-8. The Sarawak Barisan National, the state version of the federal coalition that has ruled Malaysia since independence from Britain in 1957, is expected to win just about all the 62 seats at stake in the polls. Taib's coalition swept every seat in the last polls five years ago. The 60-year-old Taib, a former lawyer and magistrate, has been chief minister of Sarawak since 1981. The Elections Commission said the nomination papers of a would-be challenger for his Asajaya seat were rejected on technical grounds. Among those who were returned uncontested is James Wong, 74, the controversial Minister of Environment and Housing. Both Taib and Wong, a leading timber baron, have been elected unopposed for the first time. Anti-logging interests had mounted campaigns against them in previous elections. Sarawak, a Borneo island state larger than peninsular Malaysia itself, is largely covered by rainforests and logging is one of its biggest businesses. More than 3,000 supporters, including Taib's wife Laila, a Polish-Moslem from Australia, accompanied the chief minister on a one-kilometre march to the nomination centre in Asajaya. Taib expressed concern that his coalition's expected overwhelming victory would deter people from voting. The main opposition, the Democratic Action Party, fielded only six candidates, with 60 independents joining the fray after candidates filed their nomination papers on Tuesday. The uncontested races in 19 constituencies mean 233,650 voters, or 28 percent of the total electorate of 814,347, will not be going to the polls next month, leaving 580,697 voters to choose candidates for the other 43 seats. 3957 !GCAT !GCRIM !GPOL Filipino politicians said on Tuesday the death sentence South Korea imposed on ex-president Chun Doo Hwan was an object lesson for the Philippines, where even blatantly criminal officials often get off scot-free. "I hope it can happen here," Senator Ernesto Maceda told reporters. "But...I don't think I will live to see it." Senator Raul Roco said he hoped the day would come when a Philippine court sent erring politicians to jail. "What the Koreans are showing is that they can impose the law without fear or favour," he said. Perhaps the best known example of Philippine forgiveness is former first lady Imelda Marcos, accused, along with her late husband and their associates, of stealing some $5 billion from the national economy. Allowed to return home after her husband, ousted strongman Ferdinand Marcos, died in exile, Mrs Marcos won a House of Representatives seat last year despite an 18-year jail sentence imposed in 1993 on corruption charges. She remains free on bail pending the outcome of an appeal. Senator Gregorio Honasan, a former army colonel who escaped punishment despite his involvement in three coup attempts, said Filipinos were "more forgiving, more humane, more open-minded" than Koreans. "The cultural differences are too obvious for us to apply the same standards on our own," he said. Honasan was charged with rebellion after three failed attempts to overthrow then president Corazon Aquino between 1986 and 1989. The government later set aside the charges in case a prosecution made the army even more restive. Honasan won a seat in the Senate in elections last year. Senator Juan Ponce Enrile, also linked to army attempts to oust Aquino, said Chun's fate was "a lesson that must be kept in mind by our leaders because there is a certain limit in the exercise of power". Enrile was also charged with rebellion but the charges were dismissed for lack of evidence. 3958 !C12 !C13 !C24 !CCAT !GCAT !GCRIM The Philippines' environment department will ask the court to nullify certain land titles of property developer Puerto Azul Land Inc, the presidential palace said on Tuesday. The statement said environment secretary Victor Ramos had informed President Fidel Ramos the land covered 21.3108 hectares which had been proclaimed either as military reservation, a national park or forest land. Most of the proclamations were done in 1960s and 1970s, the statement said. The company is planning to build a resort and a marina in a 232.5 hectare lot in Batangas, just south of Manila. Puerto Azul officials were not available for comment. "(The environment) secretary said further investigation is still being conducted by his department with respect to the other PALI properties," the statement added. PALI is currently embroiled in another legal row with the heirs of deposed President Ferdinand Marcos who are claiming ownership to some of its land. - Manila newsroom 63 2 8418938 Fax 8176267 3959 !GCAT !GDIP A wave of nationalism sweeping China is a reaction to pressure from the United States and does not reflect an anti-foreign policy by Beijing, a prominent Chinese journal has said. Outlook magazine, in a commentary in its latest edition, said the United States was fearful of China's growth and had tried to hinder its development with economic sanctions. The United States wanted to Westernise and split China, it said. "It doesn't acknowledge this, but the Chinese people can see it all too clearly," the commentary said. "Opinion polls indicate that the number of young people who despise the United States is rising rapidly," it said. "Where does this sentiment among young people come from? It comes from American pressure, it comes from the American government's mistaken policy towards China," it said. China's ambitious programme of economic reform has eroded Marxist values. Western scholars and Chinese critics have said that the ruling Communist Party is now trying to use nationalism to fill the void. The journal slammed Washington for sending warships near Taiwan earlier this year while Beijing test-fired unarmed missiles off the island's coast. "(This) interfered in China's internal affairs," it said. It also accused the United States of colluding with anti-China dissidents and activists. "It is this kind of high-handedness and presumptuousness that has aroused the patriotic feelings of the Chinese people," it said. 3960 !C12 !C13 !CCAT !GCAT !GCRIM The Philippines' Court of Appeals has issued a temporary restraining order against the National Telecommunications Commission (NTC) granting authority to Eastern Telecommunications Philippines Inc (ETPI) to put up local exchange lines, documents released on Tuesday showed. The petition was filed by Bell Telecommunications Philippines Inc (BellTel) which said ETPI has no financial capability to lay down 300,000 lines since it is a sequestered company. ETPI is 40 percent owned by Cable & Wireless plc. The remaining shares are held by the Philippine Commission on Good Government, a state agency pursuing assets of deposed dictator Ferdinand Marcos. The agency sequestered the ETPI shares on suspicion they were owned by accociates of Marcos. BellTel had applied to set up a nationwide local exchange network, but the NTC dismissed its application. ETPI has a pending application to put up 300,000 telephone lines in certain parts of Manila and northern Philippines. - Manila newsroom 632 8418938 Fax 8176267 3961 !GCAT !GDIP Indonesia's Galang Island camp for Vietnamese boatpeople could be closed within a week with the departure of the last 500 people, a U.N. High Commissioner for Refugees (UNHCR) official said on Tuesday. Brian Lander, head of the UNHCR's office in nearby Tanjung Pinang, said Voluntary Repatriation (Volrep) and the Orderly Repatriation Programme (ORP) were drawing to a close. "Our next movement will be on the 29th and that will be our last chartered Volrep movement simply because we don't have any more people," Lander speaking by telephone from Tanjung Pinang. On August 22 a Volrep chartered flight carried 224 people, but the final flight will carry about 30 people, he said. "The ORP had a ship leave (on Monday) with 188 people on board," Lander said. "That leaves us with approximately 500 people and I think (the Indonesian government) is planning to send them back on two ships in early September and that will be the entire caseload gone," he said. The Vietnamese had given permission for the two ships to arrive on September 5 at Vung Tau, two days' sailing from Galang, he added. Indonesia has been keen to clear the Galang camp, which held more than 10,000 boatpeople in the early 1990s, so the island can be redeveloped as part of a special industrial zone tapping into growth in nearby Singapore and Malaysia. The boatpeople started fleeing Vietnam, most of them in flimsy boats, after the communist victory in 1975, and more than 13,000 remain in detention centres in Hong Kong. 3962 !C12 !C41 !CCAT !GCAT !GCRIM It was business as usual on Tuesday for South Korean tycoons sentenced for bribery on Monday, with one jetting off to Libya and others planning overseas jaunts. Attention was focused mainly on the fate of the globe-trotting chairman of the Daewoo Group who was handed a two-year jail sentence after being convicted of bribing former president Roh Tae-woo. Analysts said Daewoo, which has invested billions of dollars overseas, would be most vulnerable to the loss of its charismatic chairman, Kim Woo-choong. But they said the moguls were likely to be spared jail time since they were too important to the national economy. Nine corporate heads were convicted of bribing Roh in return for business favours. Kim and the heads of Dong-Ah, Jinro and Hanbo received jail terms and the others suspended jail sentences. "It's not in the government's best interest to see the economy suffer," said Richard Samuelson, head of research at SBC Warburg's Seoul branch, adding he expected the tycoons would avoid jail. "There has to be a balance between justice and running a healthy economy." Shares in Daewoo Corp were battered on Monday in anticipation of the verdict and on Tuesday edged down 70 won ($0.09) to 7,200 won. "Daewoo would be in chaos if Kim Woo-choong was jailed. It would be a stranded ship," said Tae Chung, head of research at Jardine Fleming Securities. "Kim was involved in every area of Daewoo's work." Kim spearheaded Daewoo's aggressive expansion overseas, setting up car plants in the former communist bloc countries, building hotels in China and becoming the largest foreign investor in Vietnam. "Daewoo is widely regarded as a creature of Kim Woo-choong's energy and force of will," said Samuelson. There was no indication Kim's hard-charging business style has been affected by the sentence. "The chairman will continue his active participation in all our business fields," a Daewoo spokesman said. "We don't believe the jail sentence will hurt our investment projects abroad." Kim will fly to China on Wednesday to open a hotel before touring Daewoo's automobile factories in Eastern Europe. Dong-Ah chairman Choi Won-suk, handed a 2-1/2 year jail term, boarded a flight for Libya to attend a ceremony marking the completion of the second phase of a huge waterway project. Jinro chairman Chang Jin-ho, also sentenced to two years behind bars, plans to visit Cambodia next month to negotiate a farm development project, a group spokesman said. All three have received court permission to travel. Chung Tae-soo, honorary chairman of the Hanbo group had no travel plans. He was given a two-year term. Chung and Chang appealed their sentences on Tuesday. Kim and Choi plan to appeal. All remain free pending their appeals. Some analysts said the government is expected to tread carefully because jail for the businessmen would have serious repercussions on affiliate companies, especially on their ability to raise finance overseas. "Overseas lenders don't like seeing chairmen in jail," said Samuelson. 3963 !GCAT !GCRIM A blind 10-year-old boy from China sneaked over the border into Hong Kong and was arrested as an illegal immigrant, Hong Kong police said on Tuesday. He was caught by police trying to force his way into a home in the rural New Territories, a police spokesman said. "The boy came from China's eastern province of Jiangsu. He was spotted by a passerby trying to climb into an apartment in the early hours of Monday morning," the spokesman said. No decision has yet been made on how to deal with the boy. Hong Kong police regularly catch hundreds of illegal immigrants and people who have overstayed their visas from mainland China and send them back. Hong Kong, a British colony, reverts to Chinese control next year but will remain sealed off from the mainland except to a tiny trickle of legal immigrants and people with special visit permits. 3964 !GCAT !GDIP !GPOL Israel fuelled Palestinian doubts about its commitment to peace on Tuesday by lifting a bulldozer over the walls of Jerusalem to demolish an Arab building and approving the expansion of a West Bank Jewish settlement. Palestinian President Yasser Arafat summoned foreign envoys and urged them to put pressure on Israel to stop demolitions which he called part of a policy to "Judaise" Arab neighbourhoods in the contested city. Palestinian legislators rushed to the Old City to lead protests against the demolition which they said showed that Israel's new right-wing government under Benjamin Netanyahu was not committed to the U.S.-sponsored peace process. The Israeli decision to expand the settlement and the demolition in Jerusalem would be discussed on Wednesday at a meeting of the Palestinian Legislative Council in Ramallah, Palestinian officials said. A Jerusalem municipality spokeswoman said the unfinished building, intended by Palestinians as a community centre, was built without a permit. Police sealed off a section of the city's Ottoman-built walls before dawn while most residents were asleep and brought in a crane to hoist a bulldozer over the top. The bulldozer, which could not pass through the city's gates, flattened the building which Palestinians said was funded by contributions from charities and organisations in Canada and Sweden. In a separate move the government said it had approved the building of a new neighbourhood at a Jewish settlement in the West Bank. "The neighbourhood in question is within Kiryat Sefer settlement. The building plan was approved in the past by the previous government and it was frozen and now it has been approved anew according to the government's decisions," a defence ministry spokeswoman said. The Maariv newspaper said the neighbourhood comprised 1,806 housing units but only 900 would be built in the first stage of the plan. Israel's Housing Ministry on August 20 said that it was drafting a plan to approve construction of 5,000 new homes in the West Bank. It was not immediately clear if the Kiryat Sefer project was part of that plan. Kiryat Sefer is located west of Ramallah and just east of Israel's pre-1967 Middle East war border with the West Bank. While the previous government froze new settlement building and some large projects, it did allow building in West Bank settlements around Jerusalem and along the old border -- areas it hoped to keep in a final peace deal with the Palestinians. The Kiryat Sefer is the first such plan since Netanyahu's Likud government won elections in May. Netanyahu has promised to honour the previous Labour government's self-rule agreement with Arafat. But he has halted implemention of the accord and shied away from meeting the Palestinian leader. The United States, which is overseeing the entire Middle East peace process, organised a discreet meeeting of U.S., Israeli and Egyptian officials in Paris on Tuesday in an attempt to set Israel back on high-level talks with the Palestinians, Syrians and Lebanese. The meeting was called before the dawn demolition in Jerusalem which Arafat condemned. "These attempts and measures are part of a premeditated policy to Judaise Arab Jerusalem," Arafat was quoted as saying by the Palestinian news agency WAFA. "To empty the city of its inhabitants and to encourage settlement," Arafat said. Jerusalem, a city holy to Jews, Christians and Moslems, is one of the most explosive issues on the table in stalled Israeli-Palestinian talks on the final status of the Arab lands captured by the Jewish state in 1967. Arafat wants its Arab eastern sector, which includes the walled Old City and most religious sites, as the capital of a future Palestinian state. Israel claims the entire city as its capital. 3965 !GCAT !GDIP Syria said on Tuesday it was ready to resume peace talks with Israel in Washington from the point where they broke off in March after a wave of Islamic suicide bombings in Israel. Foreign Minister Farouq al-Shara said some progress had been made in talks with the former Labour-led government of prime minister Shimon Peres regarding the principle of land-for-peace and security arrangements. "There are points which were not agreed upon and there are points which were agreed upon and the United States as a sponsor of the talks knows what was agreed upon and what was not agreed upon," Shara said. "The talks should not start from zero point. We said that Syria is ready to resume the talks from the point where they stopped," he told reporters at Damascus airport as Egyptian Foreign Minister Amr Moussa ended a trip to Syria. Israel welcomed Syria's readiness to resume talks in Washington but ruled out setting pre-conditions. "We welcome this kind of announcement because it shows a willingness to return to the talks and we hope they agree to do so without pre-conditions," Prime Minister Benjamin Netanyahu's communications director David Bar-Illan told Reuters in Jerusalem. Moussa said on leaving Damascus that he had good talks with President Hafez al-Assad and that Syria was ready to resume negotiations with Israel within the framework of United Nations resolutions and the land-for-peace principle. "Since there was progress in some spheres it is important to take that position and build on it, not to start from the zero point. Syria's readiness to resume the peace talks comes within this context," Moussa said. "I can convey to you Syria's full determination to march on the way of peace within the framework of commitments and principles which were agreed upon," Moussa said. The ministers' remarks implied that Syria wanted a resumption of talks on the condition they were still based on the land-for-peace formula, whereby Israel returns occupied Arab land in exchange for peace treaties with its neighbours. Whereas the previous Labour-led government under Peres accepted this principle, the new right-wing government under Likud's Netanyahu has rejected it, saying Israel will keep Syria's Golan Heights, captured in 1967. Peres' government suspended peace talks with Syria and recalled its peace team from Washington in March after four suicide bombings killed 59 people in Israel. The sporadic talks, which opened in Madrid in 1991, have been stalled over the fate of the Golan Heights, security arrangements and future ties. Syria wants a full Israeli pullback from the Golan and says security arrangements should be equal and balanced. 3966 !GCAT !GDIP Syria said on Tuesday it was ready to resume peace talks with Israel in Washington from the point where they broke off in March after a wave of Islamic suicide bombings in Israel. Foreign Minister Farouq al-Shara said some progress had been made in talks with the former Labour-led government of prime minister Shimon Peres regarding the principle of land-for-peace and security arrangements. "There are points which were not agreed upon and there are points which were agreed upon and the United States as a sponsor of the talks knows what was agreed upon and what was not agreed upon," Shara said. "The talks should not start from zero point. We said that Syria is ready to resume the talks from the point where they stopped," he told reporters at Damascus airport as Egyptian Foreign Minister Amr Moussa ended a trip to Syria. Moussa said he had good talks with President Hafez al-Assad and that Syria was ready to resume negotiations with Israel within the framework of United Nations resolutions and the land-for-peace principle. "Since there was progress in some spheres it is important to take that position and build on it, not to start from the zero point. Syria's readiness to resume the peace talks comes within this context," Moussa said. "I can convey to you Syria's full determination to march on the way of peace within the framework of commitments and principles which were agreed upon," Moussa said. The ministers' remarks implied that Syria wanted a resumption of talks on the condition they were still based on the land-for-peace formula, whereby Israel returns occupied Arab land in exchange for peace treaties with its neighbours. Whereas the previous Labour-led government under Peres accepted this principle, the new right-wing government under Likud Prime Minister Benjamin Netanyahu has rejected it, saying Israel will keep Syria's Golan Heights, captured in 1967. There was no immediate Israeli response to Shara's offer. Israel wants talks to resume without pre-conditions. Peres' government suspended peace talks with Syria and recalled its peace team from Washington in March after four suicide bombings killed 59 people in Israel. The sporadic talks, which opened in Madrid in 1991, have been stalled over the fate of the Golan Heights, security arrangements and future ties. Syria wants a full Israeli pullback from the Golan and says security arrangements should be equal and balanced. 3967 !GCAT !GDIP !GPOL Palestinian leaders, irked by Israel's decision to expand a Jewish settlement in the West Bank, meet on Wednesday to discuss the implications for Middle East peace moves. Palestinian President Yasser Arafat will fly to Ramallah for a meeting of the Palestinian Legislative Council a day after Israel said it would build a new neighbourhood in the Kiryat Sefer settlement west of the Arab town. Legislative Council President Ahmed Korei, better known as Abu Alaa, said Palestinians must examine "whether there is any real peace process at all" with Israel under Prime Minister Benjamin Netanyahu, elected last May. The announcement of the settlement expansion and Israel's demolition of an Arab building in Jerusalem's Old City on Tuesday fuelled Palestinian doubts about the Jewish state's commitment to peace deals with the Palestine Liberation Organisation (PLO). Arafat summoned foreign envoys and urged them to put pressure on Israel to stop demolitions which he called part of a policy to "Judaise" Arab neighbourhoods in the contested city. Palestinian legislators rushed to the Old City to lead protests against the Israeli action. A Jerusalem municipality spokeswoman said the unfinished building, intended by Palestinians as a community centre, had been built without a permit. "These attempts and measures are part of a premeditated policy to Judaise Arab Jerusalem to empty...its inhabitants and to encourage settlement building inside Jerusalem's neighbourhoods," Arafat was quoted as saying by the Palestinian news agency WAFA. Police sealed off a section of the Old City before dawn as a crane hoisted a bulldozer over the Ottoman-built walls. The bulldozer, too big to enter through the gates of the Old City, flattened the building which had been under construction. Israeli and PLO leaders, who signed their first-ever peace deal in 1993, had agreed to postpone discussion on Jerusalem and other explosive issues -- including the fate of settlements in the West Bank -- until "final status" talks which began in May. Arafat wants its Arab eastern sector, which includes the walled Old City and most religious sites, as the capital of a future Palestinian state. Israel claims the entire city as its capital. Israel's previous government had frozen most settlement activity but Netanyahu's administration announced this month it was formally lifting the freeze. "The neighbourhood in question is within Kiryat Sefer settlement. The building plan was approved in the past by the previous government and it was frozen and now it has been approved anew according to the government's decisions," a Defence Ministry spokeswoman said. The newspaper Maariv said the neighbourhood comprised 1,806 housing units but only 900 would be built in the first stage of the plan. Israel's Housing Ministry said last week that it was drafting a plan to approve construction of 5,000 new homes in the West Bank. It was not immediately clear if the Kiryat Sefer project was part of that plan. 3968 !GCAT !GDIP Israel on Tuesday welcomed Syria's readiness to resume peace talks in Washington suspended since March but ruled out setting pre-conditions for the negotiations. "We welcome this kind of announcement because it shows a willingness to return to the talks and we hope they agree to do so without pre-conditions," Prime Minister Benjamin Netanyahu's communications director David Bar-Illan told Reuters. Syrian Foreign Minister Farouq al-Shara said on Tuesday Damascus was ready to resume talks with Israel from the point where they broke off after a wave of Islamic suicide bombings in the Jewish state. He said the two sides had made some progress in negotiations with the former Labour-led government of Shimon Peres regarding the principle of land-for-peace and security arrangements. "There are points which were not agreed upon and there are points which were agreed upon and the United States as a sponsor of the talks knows what was agreed upon and what was not agreed upon," Shara said. "The talks should not start from zero point. We said that Syria is ready to resume the talks from the point where they stopped," he told reporters at Damascus airport as Egyptian Foreign Minister Amr Moussa ended a trip to Syria. Netanyahu, who toppled Peres in national elections in May, rejects trading land for peace with the Arabs. His government has said it would not be bound by unwritten understandings reached in negotiations conducted by the previous government. Syria wants back the Golan Heights in exchange for peace, a strategic plateau Israel captured in the 1967 Middle War and later annexed. Netanyahu refuses to give up the Golan. 3969 !GCAT !GDIP Azerbaijan's Foreign Minister Hasan Hasanov told Iran's president on Tuesday that Baku wanted to improve ties between the two neighbouring countries, state-run Tehran radio said. It quoted Hasanov as telling Akbar Hashemi Rafsanjani during a visit to Tehran "the present political will in Azerbaijan is directed towards getting rid of possible hindrances to improved relations with Iran." Hasanov also urged Tehran to continue its assistance to the Azeri enclave of Nakhichevan, which is sandwiched between Iran and Armenia and relies for much of its electricity and supplies on the Islamic republic. Rafsanjani said Iran also wanted better ties with Azerbaijan and was willing to help Nakhichevan, the radio reported. Iran has given political support to Moslem Azerbaijan in its long-running conflict with Armenia over the Nagorno-Karabakh enclave. But their ties have been strained because of Azerbaijan's relations with Israel and other issues. Tehran-Baku ties improved since an Iranian firm in June won a 10 percent stake in a $4 billion foreign consortium to develop Azerbaijan's Shakh-Deniz oilfield in the Caspian. The Iranian news agency IRNA said Hasanov and Iranian Foreign Minister Ali Akbar Velayati discussed drawing up a legal framework for the use of Caspian Sea oil and fishing resources by littoral states. Iran, Azerbaijan, Russia, Kazakhstan, and Turkmenistan, which all border the Caspian, have so far failed to agree on a legal framework for sharing the sea's resources. Oil Minister Gholamreza Aghazadeh told Hasanov that Iran welcomed setting up joint drilling firms and was willing to sell natural gas to Nakhichevan. Azerbaijan offered Iran the Shakh-Deniz stake after Tehran was shut out of a larger multinational Caspian oil project following objections to the deal by the United States. 3970 !GCAT !GDIP !GPOL Palestinian leader Faisal al-Husseini, a PLO excutive committee member, said on Tuesday that Palestinians would not resume talks with Israel unless they were based on a definite plan towards final status negotiations. "The Palestinian authorities will not return to negotiations with the Israeli government unless on the bases of putting a definite working plan decided within the general framework of the final status negotiations," official sources quoted him as saying. Israel and the Palestinians were due to start talks in May on the final status of the Palestinian self-rule areas and in particular Jerusalem. Israel says the city is its eternal capital, while the Palestinians want Arab East Jerusalem as the capital of a future state. The official Syrian news agency (SANA) also quoted Husseini, during talks with Syrian Information Minister Mohammed Salman, as condemning the Israeli demands to close Orient House, the PLO headquarters in Arab East Jerusalem. Israeli Prime Minister Benjamin Netanyahu said on Monday he expected progress in the stalled peace process with the Palestinians in the coming weeks. Husseini, responsible for Jerusalem affairs, said Orient House would still be opened for official visitors. "Husseini discussed the situation in the occupied Arab lands and the Israeli measures to demolish (Arab East) Jerusalem and close the Palestinian establishments and its attempts to close Orient House in contradiction to the deals sealed according to the U.N resolutions," SANA said. Netanyahu has taken a tougher line on Palestinian activities in Jerusalem, captured by Israel in 1967 and declared its eternal capital, than the Labour government he ousted. The Palestinian self-rule Authority said on Monday it had shut two of its offices in the city to deprive Netanyahu of any excuse to slow peace moves but said Israel had no right to demand the closure. At dawn on Tuesday, Israel hoisted a bulldozer over the walls of Jerusalem's Old City and destroyed an incomplete Arab building which Palestinians said was intended as a centre for the handicapped. The Israeli Municipality of Jerusalem said it was being built without a permit. Palestinians called a two-hour general strike and marched in protest at the demolition. Two radical Palestinian groups in Damascus condemned the Palestinian Authority's closure of the two offices as abandoning the Arabs' rights in Jerusalem. "This decision clearly shows the continuation of the humiliating policy of capitulation of (Palestinian President Yasser) Arafat in submission to the orders of Israel," the Popular Front for the Liberation of Palestine (PFLP) said. "It is also a new indication of the policy of abandoning the rights in the holy city which the Netanyahu government works to make an eternal capital for the occupation," the PFLP statement added. PLO officials said Israel demanded the authority shut the offices at a meeting between Netanyahu envoys and Palestinian officials in Gaza last week. Israel charged that the offices were being used to carry out the authorities' activities which should be restricted to self-rule areas. The Democratic Front for the Liberation of Palestine (DFLP) said opposition suppoorters went on strike for two hours in Jerusalem to condemn "the closure as a step to meet the demands of Netanyahu and create the de facto status to demolish and Judaise (Arab East) Jerusalem." 3971 !GCAT !GVIO A policeman guarding the Russian consulate in Bahrain was seriously injured when two people opened fire on him on Monday, a government official said on Tuesday. "A policeman guarding the Russian consulate in the Zinj district was hurt in an armed attack by two people. He received serious injuries," the official told Reuters. He said a doctor's report said the policeman's condition was stable. He did not give his nationality or details about the attackers. The Russian embassy on Tuesday moved their consular section to their embassy nearby after the attack in the capital Manama, an embassy official said. "The attack targeted a guard at the consular section," he said. There was no information about any arrests or suspects. It was the first reported attack on a policeman guarding a foreign mission in Bahrain since anti-government unrest broke out in December 1994. 3972 !E51 !ECAT !GCAT !GDIP Bosnian Prime Minister Hasan Muratovic arrived in Ankara on Tuesday for an official visit where he is due to discuss Turkey's aid to the former Yugoslav republic. The premier, who is due to meet his Turkish counterpart Necmettin Erbakan on Tuesday, will also be discussing the postponed Bosnian elections, a foreign ministry official said. A small number of Bosnians had also begun to vote in Turkey. Muratovic is also due to meet with President Suleyman Demirel, Foreign Minister Tansu Ciller and Turkish businessman, the ministry official said. He will leave on Thursday. A U.S. diplomat in charge of elections in Bosnia announced earlier that municipal polls due on September 14 with other Bosnian elections would be put off because of irregularities by the Serbs in registering voters. He said no new date had been set yet. "Turkish people are watching closely the developments in Bosnia. We have seen elections as a step in the normalisation process," the foreign ministry official said. 3973 !GCAT !GPOL !GVIO Jordanians slaughtered camels, cheered and ululated in a show of loyalty to King Hussein on Tuesday as he visited a southern region shaken by protests this month over bread price rises. The king flew to the town of Aiy, about 15 km (10 miles) from the fortress town of Karak where riots broke out 10 days ago after the government doubled the price of bread, the staple food for Jordan's poor. Speaking from a Bedouin tent on a hill-top overlooking the Dead Sea, he told a gathering of around 3,000 people that Jordanians should remain "steadfast and united in the face of all difficulties and challenges". Without referring specifically to the government's tough economic reforms and the disturbances in Karak, the king appealed to Jordanians' history of "steadfastness and sacrifice" to overcome their difficulties. "Let dialogue be our path in the search for improvement in every situation and toward every problem," he said. Three young camels were slaughtered in a display of loyalty as the king arrived in a military helicopter amid tight security. Officials, including local Islamist parliamentarian Ahmed Kasasbeh, read speeches pledging support for the king. The government has accused neighbouring Iraq of fomenting the three days of protests, the worst civil disturbances in Jordan since 1989 riots which also followed bread price rises. But many politicians and ordinary people have treated the claim with scepticism, pointing instead to rising poverty and unemployment as causes of the unrest. "Our dinars are being eaten away by the price rises," said Amir, a father of two who said he takes home about 90 dinars ($127) a month from his job at a local potash plant after loan repayments. The government promised to compensate for the price rises with a monthly allowance to all of 1.280 dinars ($1.80). "This is just symbolic," said Khaldun, a part-time tourist operator. "Some people will be spending 10 or 15 dinars a month extra." Information Minister Marwan al-Muasher said on Monday the price rises were a vital part of overall cuts in subsidies which would save Jordan $160 million a year. Prime Minister Abdul Karim al-Kabariti has assured businessmen his government is still committed to its economic reforms, directed by the International Monetary Fund, despite the protests over the subsidy cuts. "Nobody said it was an easy decision, but reforms need sacrifices," said Kabariti, who attended the festivities in Aiy. "We are trying to put this economy on track, to make it market friendly and attractive for investment," he told Reuters. 3974 !GCAT !GDIP !GVIO The flight of Iraqi hijackers to Britain apparently to seek asylum makes them the latest of tens of thousands of their countrymen to flee oppression or poverty at home. They range from high-profile relatives of Iraqi President Saddam Hussein to middle-class families wrecked by years of war and isolation. After the hijackers of a Khartoum-Amman flight released all 199 people aboard and surrendered at an airport near London on Tuesday, police said the Iraqi nationals were thought to be seeking asylum. Other Iraqis have not chosen such a spectacular method of flight, but there is no shortage of Iraqis who would like to join them in Britain. "The (Jordanian) government indicates there are about 20,000 Iraqis here but we have information there are up to 100,000," said Anthony Maryon, head of the regional delegation of the International Federation of Red Cross and Red Crescent Societies. "Some are living on only 2 JDs (Jordanian dinars - $2.80) a day for a family of six," he said. "And these were largely middle class before." The refugees are overwhelmingly economic, fleeing the uncertainty and poverty spawned by nearly two decades of wars. The 1980-88 war of attrition with Iran had barely ended when Saddam invaded Kuwait in 1990, triggering the U.S.-led onslaught of the Gulf War and the U.N. economic sanctions that have cut Iraq off from world trade. Iraqis, especially the middle class whose living standards collapsed, have poured into Jordan under sanctions. But most are then stranded, refused visas to the West where they had hoped to rebuild their lives. Just a rumour that an embassy will give visas draws crowds. When the Canadian embassy produced an information sheet to screen out those who would never quality for a visa, hundreds of Iraqis were lined up before opening hours waiting for a copy. Desperate Iraqis, even well-educated ones, believed a rumour that New Zealand was inviting large numbers of Iraqis to replace its citizens who had fled because of a hole in the ozone layer. The reality is that few Iraqis get visas, leaving most in Jordan eking out a living to support their families and hoping that at least some relatives can move on. Sprinkled among those driven from Iraq by economics are those fleeing a police state where bloody purges of people accused of treason are a method of rule. The dissidents are likely to receive a more sympathetic hearing. Those who were tortured or fear for their lives can qualify for asylum on humanitarian grounds. Those who want to join the opposition to Saddam are likely to get a sympathetic hearing from western intelligence agencies that are active in Jordan. But not always. A year ago this month two sons-in-law of the Iraqi president, including Hussein Kamel Hassan who ran secret military programmes, fled to Jordan in the middle of the night and were granted protection. No other country wanted them and the Iraqi opposition shunned men so closely associated with Saddam's policies. Bored and seeing no future as dissidents, they accepted Saddam's promise of a pardon and returned to Baghdad last February. Three days later they were dead. The Iraqi government said they were killed by relatives, shamed at their betrayal. 3975 !GCAT !GDIP A new U.N. relief coordinator has arrived in Baghdad to take up the task of organising humanitarian goods distribution and to face Iraq's continuing opposition over the number of international monitors to be involved. U.N. and diplomatic sources said on Tuesday that Secretary- General Boutros Boutros-Ghali had appointed Italian Gualtiero Fulcheri and sent him to Iraq last week to replace Moroccan Mohamed Zejjari. One diplomat said Iraq and U.N. were still in disagreement on how many international observers would be required to ascertain the equitable distribution of humanitarian supplies that will be procured under Baghdad's oil deal with U.N. "The United Nations would like to employ hundreds of foreign monitors. Baghdad says it can only accept a few dozens," said the diplomat. Baghdad holds that the Iraq-U.N. memorandum of understanding on partial oil sales signed last June does not specify how many foreign observers should be stationed in Iraq. "Observation of food supplies and their distribution are still a major issue and seems the two sides have not yet filled the gap separating them," said another diplomat. Iraq's partial oil sales pact with U.N., allowing crude exports worth $2 billion every six months, gives U.N. the right to supervise the purchase and distribution of food supplies in the country. The deal is a humanitarian exception to the U.N. sanctions imposed on Iraq for invading Kuwait in 1990 which include a ban on its oil exports. Fulcheri declined comment on the differences between the U.N. and Iraq, saying only: "There are several different things which still need to be done." Fulcheri started his U.N. career in 1960 and has long experience in U.N. emergency relief in Congo, Angola, Sudan and Somalia. 3976 !GCAT !GDIP !GPOL Israel fuelled Palestinian doubts about its commitment to implement a peace agreement on Tuesday by lifting a bulldozer over the walls of Jerusalem to demolish an Arab community centre and approving the expansion of a West Bank Jewish settlement. Palestinian President Yasser Arafat summoned foreign envoys and urged them to put pressure on Israel to stop demolitions which he called part of a policy to "Judaise" Arab neighbourhoods in the contested city. Palestinian legislators rushed to the Old City to lead protests against the demolition which they said showed that Israel's new right-wing government under Benjamin Netanyahu was not committed to the U.S.-sponsored peace process. A Jerusalem Municipality spokeswoman said the unfinished building, intended by Palestinians as a community centre, was built without a permit. Police sealed off a section of the city's Ottoman-built walls before dawn while most residents were asleep and brought in a crane to hoist a bulldozer over the top. The bulldozer, which could not pass through the city's gates, flattened the building which Palestinians said was funded by contributions from charities and organisations in Canada and Sweden. In a separate move the government said it had approved the building of a new neighbourhood at a Jewish settlement in the West Bank. "The neighbourhood in question is within Kiryat Sefer settlement. The building plan was approved in the past by the previous government and it was frozen and now it has been approved anew according to the government's decisions," a defence ministry spokeswoman said. The Maariv newspaper said the neighbourhood comprised 1,806 housing units but only 900 would be built in the first stage of the plan. Israel's Housing Ministry on August 20 said that it was drafting a plan to approve construction of 5,000 new homes in the West Bank. It was not immediately clear if the Kiryat Sefer project was part of that plan. Housing ministry officials were not available to comment. Kiryat Sefer is located west of Ramallah and just east of Israel's pre-1967 Middle East war border with the West Bank. While the previous government froze new settlement building and some large projects, it did allow building in West Bank settlements around Jerusalem and along the old border -- areas it hoped to keep in a final peace deal with the Palestinians. The Kiryat Sefer is the first such plan since Netanyahu's Likud government won elections in May. Netanyahu has promised to honour the previous Labour government's self-rule agreement with Arafat. But he has halted implemention of the accord and shied away from meeting the Palestinian leader. The United States, which is overseeing the entire Middle East peace process, organised a discreet meeeting of U.S., Israeli and Egyptian officials in Paris on Tuesday in an attempt to set Israel back on high-level talks with the Palestinians, Syrians and Lebanese. The meeting was called before the dawn demolition in Jerusalem which Arafat condemned. "These attempts and measures are part of a premeditated policy to Judaise Arab Jerusalem," Arafat was quoted as saying by the Palestinian news agency WAFA. "To empty the city of its inhabitants and to encourage settlement," Arafat said. Jerusalem, a city holy to Jews, Christians and Moslems, is one of the most explosive issues on the table in stalled Israeli-Palestinian talks on the final status of the Arab lands captured by the Jewish state in 1967. Arafat wants its Arab eastern sector, which includes the walled Old City and most religious sites, as the capital of a future Palestinian state. Israel claims the entire city as its capital. 3977 !GCAT !GDIS !GENT Actor Jan-Michael Vincent improved to serious but stable condition Tuesday and the outlook for his recovery from a spinal cord injury was positive, hospital officials said. The 51-year-old actor, best known for his role in the television series "Airwolf," was hospitalized in critical condition with a fractured vertebrae Monday after a car accident. Sheriff's Lt. Rich Paddock said Vincent was apparently following his girlfriend, Michelle Wallace, to her mother's home in Mission Viejo Monday, when his car struck the rear of hers, spun out of control and hit a traffic signal. Wallace and her two sons, age five and six, who were in the car with her, were not hurt in the accident, which occurred about 40 miles (65 km) southeast of Los Angeles. A spokeswoman at the Mission Hospital Regional Medical Centre said the outlook for Vincent's recovery "looks positive at this point," adding that there was no sign of paralysis or neurological damage. "Airwolf" ran on CBS from 1984 to 1986. 3978 !GCAT !GDIS !GWEA Hurricane Edouard remained a powerful storm on Tuesday with maximum sustained winds of 130 mph (215 kph) as it moved north of the Caribbean islands, the National Hurricane Centre said. But forecasters continued to say it was too early to tell whether the potentially deadly tempest would strike the Bahamas and United States coast, or move more toward the north and stay in the open Atlantic. They hoped to know more on Wednesday. "We're still looking for that gradual turn toward the northwest during the next two to three days, but we don't know," said Mike Hopkins, a meteorologist at the National Hurricane Centre. Computer models used by the hurricane centre predicted varying courses for Edouard over the next few days, including one that had Edouard brushing near the Bahamas in three days and then threatening the U.S. mainland. The storm was expected to spare the Leeward Islands of the eastern Caribbean. "The outer rim of the Caribbean islands should pay attention to this storm but we think they are going to be in good shape," said forecaster Brian Jarvinen. "Tomorrow is when we should be a little more definitive about whether it is going to pose a threat to the U.S. mainland." At 5 p.m. EDT (2100 GMT), Edouard was centred 265 miles (426 km) north-northeast of the Leeward Islands, at latitude 20.7 north and longitude 60.1 west. The storm was moving west-northwest at 15 mph (24 kph), motion that was expected to continue into on Wednesday. . It had weakened slightly overnight, but maximum winds stayed at 130 mph (215 kph) during the day on Tuesday, but forecasters said Edouard remained a powerful storm capable of inflicting major damage. Forecasters also watching two tropical depressions moving away from Africa's coast on Tuesday. At 5 p.m. EDT (2100 GMT) Tropical Depression Number Six was located at latitude 14.7 north, longitude 47.2 west, or 900 miles (1,448 km) east of the Lesser Antilles. Packing maximum sustained winds of 35 mph (56 kmh), the depression was moving west at 14 mph (23 kmh). Tropical depressions become tropical storms when maximum sustained winds reach 39 mph (63 kmh). Forecasters said tropical depression six might become Tropical Storm Fran on Tuesday night or on Wednesday. A second new tropical depression, the seventh of this year's Atlantic Hurricane Season, formed on Tuesday. At 5 p.m. EDT (2100 GMT), that system was located at latitude 10.5 north, longitude 31.8 west, or about 630 miles (1,013 km) southwest of the Cape Verde Islands. The system was moving west at about 14 mph (23 kmh) and packed maximum winds were 35 mph (56 kmh). "That one may become a storm within the next couple of days," Hopkins said. 3979 !GCAT !GDEF !GDIS An Air Force F-15C jet crashed in southwest Idaho on Tuesday, the fourth U.S. military plane accident in the past week, but the pilot ejected safely, military officials said. The plane, on a routine training mission, went down about 60 miles (100 km) southwest of the Mountain Home Air Force Base, where it was based. The pilot was the only person on board, an Air Force statement said. A board of officers was to investigate the cause of the accident. The aircraft was part of the 366th Wing at the Air Force base. "The pilot ejected safely," said Lt. Shane Balken at the base. "Whether he's got any broken limbs, we don't know." The Mountain Home Air Force Base is about 45 miles (75 km) east of Boise. A U.S. Marine Corps plane crashed during a training flight in southwestern Arizona last Friday, killing all four crew members on board. A Marine reserve F/A-18 fighter attack plane crashed into the Atlantic on Thursday and the pilot was missing. Hours later an Air National Guard A-10 tankbuster crashed less than 100 miles (160 km) away, and the pilot was taken to a hospital. 3980 !GCAT !GDEF !GDIP Up to 5,000 U.S. troops are being trained in Germany to protect the pullout of U.S. forces from Bosnia, but no decision has been reached on whether they would stay on next year, defence officials said on Tuesday. ABC television reported that the U.S. troops in Germany had been told they could remain in Bosnia for a year in a possible "follow-on" to the NATO-led peace implementation force (IFOR). "There is no timetable yet established on when they will go or when they will come home," Army Lt. Col. Rick Scott, a Pentagon spokesman, told Reuters. Scott refused to discuss numbers, but other defence officials said privately that the brigade-size protective force now being trained at Hoenfels training site in Germany could number from 3,000 to 5,000 troops. There are now 15,572 U.S. troops in Bosnia -- many of whom have had prior training at Hoenfels -- as part of an international force of more than 50,000. All of the IFOR troops are scheduled to pull out of Bosnia late this year, but the alliance is already contemplating the politically sensitive issue of whether to send more troops next year to keep peace there. "There is no decision on any follow-on force, or whether this will be the follow-on force," said Scott, stressing that the North Atlantic Council of NATO would make no decision on such a move until late this year. That decision would come after the November U.S. presidential election and after September elections scheduled in Bosnia. At the State Department on Tuesday, the chief U.S. negotiator on Bosnia denied that the United States was already preparing to put additional troops into the country next year. "An individual colonel can say what he wishes (in Germany), but there is no order to troops -- not even an informal order -- to tell them they are going to be staying," John Kornblum told reporters in response to questions. "I can tell you that. We checked it this morning with the Pentagon. It also just is not the policy that they are following." 3981 !E21 !E211 !ECAT !GCAT !GPOL !GVOTE President Bill Clinton proposed on Tuesday a $2.75 billion literacy campaign for children and said he would pay for it and other initiatives in part by eliminating billions in tax breaks for multinational corporations. Churning into the election battleground state of Michigan aboard his whistlestop train, Clinton announced in the blue-collar factory town of Wyandotte the latest in a series of proposals aimed at generating popular enthusiasm as he makes his way to the Democratic National Convention in Chicago. On the third day of his four-day train ride, Clinton went to Bacon Memorial Public Library to say he wanted to lead a national effort to ensure that "all America's children" can read on their own by the third grade, or about age eight. With national reading scores lagging behind recent advances in math and science scores, Clinton said many children need individualized attention and called for a "citizen's army" of 1 million volunteers to help 30,000 reading specialists and volunteer coordinators who would be hired. "Every single, tired night a parent spends reading a book to a child is a night well worth it. Every dollar we spend bringing in people to help these kids after school with personal tutoring is a dollar well worth it," he said. The program, which would require congressional approval, would spend $2.75 billion over five years, most of it to hire the specialists to help communities provide extra reading help before and after school for 3 million children at 20,000 schools. Some $1 billion of the total would go to Clinton's national service program, AmeriCorps, which the Republican-led Congress tried but failed to kill last year as an example of wasteful government spending. Aides denied Clinton was showing liberal roots with the proposal, saying much of the money would be dispersed to states and communities. Lest he be accused by Republicans as a big-spending Democrat, Clinton aides said he would propose $8.4 billion in budget cuts and to pay for the reading program as well as other initiatives he will announce this week. But of course that did not stop the campaign of Republican presidential nominee Bob Dole from attacking the idea. "Instead of pursuing fundamental reform -- by confronting the teachers' unions and embracing school choice -- Bill Clinton announces a new government program and a new pot of money for the unions," Dole's deputy press secretary Christina Martin said. He was to detail an environmental plan on Wednesday and a job-creation program to get people off welfare on Thursday during his nomination acceptance speech in Chicago. Putting some bite into frequent administration threats to reduce so-called "corporate welfare," Clinton would get $5.3 billion over six years by limiting export-related tax breaks for multinational corporations, aides said. For 70 years, multinationals that export products abroad have been able to declare half of their export profits as income from foreign sales and therefore eligible for U.S. tax breaks. Clinton would eliminate this. "All this provision says is the company will pay (tax on) the profit where the source of the profit is," said a Clinton economic adviser Gene Sperling. Sperling said these budget savings represent the type of stringent budget conditions that Clinton is operating under with his proposal for a balanced budget by 2002. "None of these things will be popular, a lot of these things will have people who will be unhappy, but this is the real world of paying for specific savings," he said. Before taking his "21st Century Express" to Michigan, Clinton toured the Chrysler Jeep Plant in Toledo, Ohio, and watched the plant's 2 millionth Jeep Cherokee roll off the assembly. Factory workers cheered, "Jeep! Jeep! Jeep!" It had right-handed steering meaning it was intended for export to Japan. Speaking to employees afterward, Clinton said from a stage flanked by Jeep Cherokees that American exports symbolized by Jeeps have prospered since he became president because of his negotiation of trade agreements. "You proved one more time that whenever we're given a chance to compete, we can be the best in the world," said Clinton. 3982 !GCAT !GHEA !GODD A two-year old Puerto Rican girl began treatment on Tuesday for a rare condition, popularly known as "human werewolf syndrome," that left half her face covered with a hairy, dark-brown patch of skin. Abys DeJesus suffers from a "hairy nevus" on the right side of her face, a mole-like condition that has been reported only a few times in medical journals, the St. Christopher Children's Hospital said. In addition to social ostracism, the condition carries a high risk of melanoma, a potentially lethal skin cancer. It will be corrected by gradually expanding healthy skin on the girl's body with surgical balloons, then attaching that skin to the afflicted side of her face. Dr. Adrian Lo, a plastic surgeon at the hospital, said the girl was recovering after the three-and-a-half hour operation to insert five surgical balloons in her forehead, neck and scalp and partially fill them with saline solution. "It went extremely well," Lo said. He said the balloons would be enlarged with more solution on a weekly basis for at least 2-3 months before the healthy skin was transplanted. He described the disfigurement as "a very severe involvement of the entire right face. It's a very challenging surgical case." "She's taken this with good spirits. She's a very bubbly personality," Lo said. But he said, "I think she's begun to notice ... the undue attention, the stares she's been getting from people around her." He said the mole-like condition was congential, meaning sufferers are born with it, but it was not inherited. He said there were theories that people afflicted with the disease helped fuel folklore about werewolves. "People in folklore have given (the condition) the moniker the human werewolf syndrome," he said. The girl, who was accompanied to Philadelphia by her parents, will need more surgery later to correct the condition on her chest, back and legs, the hospital said. 3983 !GCAT !GDIP !GPOL !GVOTE The United States praised as "clear and decisive" a decision on Tuesday to postpone the municipal part of Bosnian elections due next month. "We think, in fact, it's a very clear and a very decisive step by the OSCE (Organization for Security and Cooperation in Europe) and by (U.S.) Ambassador (Robert) Frowick to demonstrate that there are clear rules for holding these elections and that violation of them in their letter, or, in this case, in their spirit will not be tolerated," the chief U.S. negotiator on Bosnia, John Kornblum, said. Earlier on Tuesday in Sarajevo, Frowick, the U.S. diplomat in charge of Bosnian polls as head of the OSCE mission in Bosnia, said he made a "chairman's decision" to postpone the voting because of alleged voter registration irregularities. Kornblum, who leaves for the Balkans on Wednesday to meet key local leaders, said the irregularities chiefly involved the Serbs and, to a lesser extent, the Croatians. At issue was the large number of Serb registrants declaring an intention to live in cities such as Srebrenica, the site of massacres of Moslems last year that constituted the worst atrocities in Europe since the Second World War. "This irregularity was so great and so obvious that it was felt by Ambassador Frowick -- and we agreed on that decision -- that it would not be credible to hold the municipal elections," he told a briefing at the State Department. Kornblum's trip will take him to Belgrade, Zagreb and Sarajevo as well as Banja Luka "to demonstrate that we consider Pale not to be an appropriate place for the capital of the Republika Srpska." Asked about Bosnian Serb threats to hold municipal polls of their own, Kornblum said the results of any such vote "will not be accepted or certified by the OSCE," which is responsible for supervising the election through a mandate provided under the 1995 Dayton peace agreement. Kornblum said as far as he knew no decision had been made yet on when the postponed municipal elections might be held, although Frowick mentioned April or May as possible dates. The voting for cantonal assemblies, separate Moslem-Croat and Serb parliaments, a national House of Representatives and a three-man presidency will take place as scheduled on Sept. 14. Kornblum played down the postponement's possible impact on the 53,000-strong NATO-led peacekeeping mission in Bosnia, whose mandate is supposed to expire on Dec. 20. "The question of whether the municipal elections are going to be held -- either this year or next year -- is not going to be a defining factor" in any decision to extend the peacekeeping mission in Bosnia, he said. 3984 !E21 !E211 !ECAT !GCAT !GPOL !GVOTE To voters who turn out to cheer Bob Dole on the campaign trail, the Republican presidential candidate's pledge to hand out billions of dollars in tax cuts while balancing the budget is a simple matter of common sense and discipline. "Sure he can do it, absolutely," said Annette, a mother of three college-age children in Tampa, Florida. "All he has to do it get rid of that waste in Washington." But hard-core loyalists who brave the summer sun at Dole rallies or squeal when they spot him on the streets as he vacations this week in Santa Barbara are not the ones who will ultimately decide who occupies the White House come January. That decision will rest with swing voters, the undecideds like Phyllis Kindsvogel, an elderly woman from North Dakota, who fretted after Dole spoke to the Ladies Auxiliary of the Veterans of Foreign Wars in Kentucky last week. "I don't know if he can follow through. They've been working on that for years now. It's awfully tough," she said. Dole's campaign promise, which contradicts much of what he argued as a deficit hawk during 35 years in Washington, is to slash personal income taxes by 15 percent, cut capital gains taxes in half, grant child tax credits and expand long-term savings incentives. That adds up to $548 billion in tax cuts by 2002 but Dole says cutting taxes will not prevent him from wiping out the budget deficit. In a conversion to the supply-side economics embraced by his running mate Jack Kemp and tested by President Ronald Reagan with mixed results, Dole says tax cuts will stimulate faster growth that will help offset revenue losses. He says he can balance the budget while "restraining the rate of growth" but not cutting Medicare, defence, or Social Security. Defending the soundness of his plan after a Tuesday morning session with top economic advisers, Dole said, "There isn't an economist at this table who will stick their neck out for political reasons." He said he "obviously" will release more details of his proposed spending cuts but he did not say when. Tom Carsen, an engineer from an affluent Chicago suburb, likes what he heard at a recent Dole rally. "Reagan cut taxes -- but the Democrats in Congress wouldn't let him cut spending. Dole will have a Republican Congress, he'll have the line item veto, he can do it all." Liberal Democrats naturally scoff at the Dole plan, but even some conservative economists -- academics or Wall Streeters who may support Dole but are not in his inner circle -- have reservations. "I'm a conditional supporter of the Dole plan. The condition is that he balances the budget," said Bill Niskanen of the libertarion Cato Institute in Washington "If he cuts taxes and he balances the budget we're all better off." But Niskanen doubts that Dole can meet those dual pledges without cutting defence, veterans' benefits and entitlement programme like Medicare , Social Security or other areas Dole's campaign says are "off the table." Ben Bernanke, chairman of Princeton's economics department, says there are good reasons for both tax and spending cuts, but he predicts Dole will face pressure to downsize military spending and entitlement programmes. Dole's advisers include prominent and respected economists such as Nobel prize winner Gary Becker of the University of Chicago and John Taylor of Stanford. "This is the kind of tax reduction we should have, and the growth effect is very modest," Taylor told Reuters. Unlike the most ardent supply-siders, he said, the Dole team is adding spending cuts to the mix and not relying solely on growth. But Alan Blinder, a Princeton economist who was vice chairman of the Federal Reserve for a time under Clinton, says the Dole plan "has two distinct credibility problems." "I don't see anything in this plan that could raise the long-term growth rate to 3.5 percent a year. And on the budget numbers, we've heard this before," Blinder said, recalling the "record deficits" of the Reagan years. 3985 !GCAT !GPOL !GVOTE After an emotional opening day, buoyant Democrats turned on Tuesday more to the issues that divide them from Republicans at a convention designed to build on President Bill Clinton's lead going into the November election. The cheering, banner-waving delegates massed in a cavernous basketball stadium were set to revisit their liberal past and preview a more centrist future as they adopt a platform that differs sharply with presidential rival Bob Dole's party on major social issues. The Democrats also were preparing a warm welcome for Hillary Rodham Clinton, a Chicago native and still a hit with party faithful despite opposition attacks and accusations of shady dealing that have plunged her poll ratings to record lows for a first lady. For the time being, the president would have to dominate proceedings from afar, his waving, ebullient image projected onto huge screens in the hall as he made his way to Chicago aboard a whistle-stop campaign train before his culminating speech on Thursday night. The party platform offered stark contrasts to the Republican agenda approved at their San Diego convention two weeks ago. On the economy, the Democrats eschewed grim talk of middle class despair and played up big cuts in the deficit, creation of jobs and steady growth. The platform emphasised the right to abortion, improving public education rather than giving parents grants to opt out of the system, a more generous policy towards immigrants and reforming, not scrapping, affirmative action to help minorities. At a time when the party is short on thrilling speakers, organisers reached back to its liberal past for Tuesday's message-carriers, tapping black trailblazer Jesse Jackson and former New York Gov. Mario Cuomo, two of the Democrats' finest orators. But no one is going to rock the boat. Although Jackson and many others in the party were angry that Clinton this month signed a Republican-written welfare bill, ending the principle of a federal safety net for the poor, that concern will be buried for the sake of unity. And Jackson, who electrified the Democratic faithful at each of the past three conventions, was still capable of stirring rhetoric but not of changing the Democratic drift to the centre. He has been speaking off the podium of the "big Democratic tent" in which activists "agree to disagree". He has stressed steps Clinton must take to provide the jobs needed to replace welfare and the childcare to allow parents to take them. And with delegates yelling for a second Clinton term to lead the country into the next century, many will look more to a future represented by their keynote speaker, Indiana Gov. Evan Bayh, a centrist, tax-cutting chief executive seen by some as a possible heir to Clinton. After Monday's emphasis on crime and compassion, with actor Christopher Reeve, paralysed in an equestrian accident, and former Reagan presidential spokesman James Brady speaking in wheelchairs, the theme on Tuesday was aimed at protecting children and families. Speakers planned to discuss Clinton initiatives, including tax breaks for educational purposes, college scholarships, improving television for children and a law to allow parents to take time off work for family emergencies. With Clinton riding high in opinion polls, hope has spread in Chicago that the Nov. 5 election could restore Democratic majorities in the Senate and the House of Representatives at the same time as holding the White House, although the odds of that happening are considerably slim. 3986 !C21 !CCAT !GCAT !GPOL Using automobiles as a backdrop instead of his whistlestop train, President Bill Clinton on Tuesday watched a landmark Jeep Cherokee roll off the assembly line and said it was evidence of America's economic might under his stewardship. On a tour of Toledo's Chrysler Jeep Plant, Clinton watched admiringly as a midnight blue Jeep Cherokee sport utility vehicle came off the line. It was the 2 millionth such vehicle manufactured at the plant since they began producing them here in 1983. Factory workers cheered, "Jeep! Jeep! Jeep!" It had right-handed steering meaning it was intended for export to Japan. Speaking to employees afterward, Clinton said from a stage flanked by Jeep Cherokees that American exports symbolised by Jeeps have prospered since he became president because of his negotiation of trade agreements. "You proved one more time that whenever we're given a chance to compete, we can be the best in the world," said Clinton, who was introduced by an assembly worker who spoke at the Democratic National Convention in Chicago on Monday night. The United States has struggled to bring down its trade deficit with other exporting countries but managed to reduce it to $8.1 billion in June, which analysts said was surprisingly fast. Large trade gaps with China and Japan persist, however. Clinton called the global market "a tough thing to operate in" but said he feels good about what has been happening since he began insisting that "if we were going to have free trade, it has to be fair." "You know, just four years ago this plant exported 17,500 Cherokees. This year, 41,500. That means 700 more good middle-class jobs and strong families," he said. He later boarded his "21st Century Express" for the third day of his four-day whistlestop train tour as he makes his way through five states on his way to the Democratic Convention, where on Thursday night he will accept the party's nomination for a second four-year term. Churning into the battleground state of Michigan, Clinton was to announce in the blue-collar factory town of Wyandotte the latest in a series of policy intiatives aimed at generating some enthusiasm as he makes his way to Chicago. He is to propose a $2.5 billion programme to launch a national literacy campaign for American children. His plan, as outlined by a senior White House official who spoke on condition of anonymity, is to hire reading specialists and place them at 20,000 sites across the country to establish after-school programmes to ensure that children by the third grade, or about age eight, are able to read independently. "The overall goal is to raise standards for the 21st century by making reading a basic goal for every young person," the official said. The plan would cost $2.5 billion over five years, and would be paid for by cuts elsewhere in the national budget, including an elimination of some corporate subsidies. About $1 billion of the total would expand Clinton's national service programme, Americorps, to help create a pool of reading specialists. Republicans fought hard last year to kill Americorps but failed. The senior official said currently about 6 million children, or about 40 percent of American third-graders, cannot read independently. 3987 !C12 !CCAT !GCAT !GCRIM U.S. circuit judge Paul V. Neimeyer said the U.S. appeals court will issue a decision on the Lloyd's of London case at 1400 EDT/1800 GMT. Lloyd's of London has requested a stay of a preliminary injunction that would delay its reorganization plan. Lloyd's has argued that the plan is critical to its survival and that investors, known as Names, must decide to accept or reject it by Wednesday. Under the reorganization plan, the 300-year-old insurance market plans to reinsure its massive liabilities into a new company called Equitas. It is asking investors to help fund Equitas, but has offered them a compensation package to help offset their losses. A U.S. district judge late Friday ruled that Lloyd's had sold the Names securities in violation in U.S. securities laws. The judge granted a request for a preliminary injunction delaying the plan and ordered Lloyd's to give the Names more information about the plan. The three-judge panel in the U.S. Court of Appeals for the Fourth Circuit began hearing testimony on Lloyd's appeal Tuesday morning and will issue a decision in the case from the bench. 3988 !C24 !CCAT !GCAT !GDIS A fire and explosion ripped through a welding supply company Tuesday, killing one person and forcing a neighbourhood evacuation, officials and witnesses said. Exploding tanks of gas at the Portland Welding Supply's distribution building near the waterfront sent orange fire, black smoke and bits of flaming metal hundreds of feet into the air. One firefighter died of a heart attack, but the dozen workers inside the building escaped unharmed and no residents were hurt, authorities told local news media. Authorities evacuated residents from a one-mile area around the facility out of concern that a 3,000 gallon tank of liquid oxygen might explode. Some of those evacuated were removed by boat. 3989 !GCAT !GPOL !GVOTE U.S. Democrats on Tuesday set the stage for the re-nomination of President Bill Clinton, with a big build-up starring his wife and a campaign platform portraying them as the party with a heart. With opinion polls now shifting back Clinton's way after a surge by Republican rival Bob Dole, the Democrats turned on the second day of their convention to a manifesto they hope will look centrist on the economy but far more compassionate than the Republican version. The platform was tailored to Clinton's ideas and assured of smooth passage on Tuesday evening. That would clear the way for a drum-roll of partisan oratory by rousing speakers like black civil rights leader Jesse Jackson and with Hillary Rodham Clinton in the prime-time television spotlight. Mrs Clinton's speech was likely to be a rare public attention-grabber in a predictable, stage-managed event, considering her highly controversial status: admired by many as a strong, intelligent, successful feminist, disliked by many others who consider her a meddlesome unelected co-president. The star-spangled podium of the Chicago convention and its television audience gave her, in any case, the biggest forum yet to present her views -- probably on the day's theme of children and families -- but more broadly to showcase her husband's presidency on the eve of his re-nomination. Clinton, 50, who is about to battle the 73-year-old Dole on a campaign expected to underscore the future versus the past, rolled on toward Chicago aboard his "21st Century Express" train. The colourful "whistle-stop" trip, which will deliver him to the Chicago area on Wednesday, is drawing more public attention and television coverage than the convention itself -- just as his strategists planned. Clinton's naturally exuberant campaign style got a further boost as he chugged from town to town and rally to rally by yet another poll suggesting that the surge Dole got from his own convention two weeks ago may now be cresting. An ABC poll released on Tuesday said Clinton's lead over Dole had suddenly widened to 15 points, by 51 percent to 36 percent with eight for Reform Party candidate Ross Perot. This survey measured sentiment sampled on Sunday and Monday, as the Democrats got their show under way in Chicago, and compared to a Clinton lead of only nine points -- 47-38 percent -- in a similar poll on Saturday and Sunday. Even so, Dole regularly ran 20 points and more behind until his August "bounce" and Clinton aides were well aware he could still present a formidable challenge for the November 5 election. They reckoned the president's boundless appetite for campaigning would be well-served by the campaign platform the party was formally approving on Tuesday. Unlike the hard-edged Republican platform that includes some right-wing positions Dole does not endorse, the Democratic manifesto should fit Clinton like a glove. It tries to deal with the challenge of Dole's promised sweeping tax cuts -- the very heart of his campaign -- by proposing much more modest, targeted cuts specifically aimed at helping child-rearing and education payments. It underscores Clinton's argument that Dole's plan is an irresponsible prescription for "blowing a hole" in the federal deficit and undoing recent progress in deficit reduction. The Democratic plan vows to put the budget in balance by 2002 and says, "America cannot afford to return to the era of something-for-nothing tax cuts." The Democratic platform contrasts even more sharply with the Republican on some key social issues, including: --Abortion. The Democrats reaffirm their support of abortion rights, while the Republicans want a constitutional amendment banning abortion. --Immigration. The Democrats would allow the children of illegal immigrants to go to public schools and take a generally softer stand on immigrants' rights. The Republicans would bar public education for the children of illegal immigrants and take a harder tack. --Gay Rights. Democrats would press legal efforts to end discrimination against homosexuals. Republicans would oppose such an approach. "We Democrats are justified in being proud of our platform," said Georgia's Governor Zell Miller in a speech presenting the manifesto to delegates. "And the Republicans are justified in being ashamed of theirs." 3990 !GCAT !GHEA !GPOL An anti-abortion politician addressed the Democratic convention on Tuesday, but praised the overwhelmingly pro-abortion rights party for its tolerance of his minority views. Rep. Tony Hall of Ohio said he and other Democrats who opposed abortion had always felt left out in their own party. "But this year is different. For the first time, the Democratic Party has included in our platform a conscience clause," he said. The clause recognizes and welcomes Democrats with divergent views on abortion and states they have a full part to play at all levels of the party. "The Democratic Party is indeed the party of true inclusiveness," Hall said. At its convention four years ago, organizers prevented then Pennsylvania Gov. Robert Casey, a vehement opponent of abortion, from speaking. Republicans have used their decision as an example of Democrat intolerance ever since. Casey told a news conference in Chicago on Tuesday he had asked to speak again this year but was turned down. Democratic leaders said there was not room on the program for every retired governor to speak. "I believe the Democratic party ought to be pro-woman, pro-child and pro-life," Casey said. "I asked for the opportunity to deliver this message from the podium of the Democrat National Convention. For the second time in four years, my request fell on deaf ears," he said. The Republican Party, whose platform calls for making all abortions illegal, faced a similar dilemma this year when Massachusetts Gov. William Weld asked to deliver a speech defending abortion rights and was turned down. Bob Dole, the Republican presidential nominee, tried and failed to insert a tolerance clause in his party's platform recognizing the validity of those within the party who supported abortion rights. Democrats also heard Tuesday two passionate speeches defending abortion rights. Kate Michelman, president of the National Abortion Rights Action League, described how she had an abortion at a time when the procedure was illegal after her husband abandoned her with three young children. "I'm here to speak up for choice and to speak for truth. The message from the Republican Party is one of disdain. Their answer to choice is control and punishment. Our answer is trust, compassion and respect," she said. Georgia Rep. Cynthia McKinney said: "You make your moral decisions. I'll make mine and let's leave (Republican House Speaker) Newt Gingrich out of it." 3991 !GCAT !GPOL The teachers are mad at Bob Dole. In conduct unbecoming a classroom they hiss and boo the very mention of his name. At least that is what happened on Tuesday when Vice President Al Gore addressed a group of teachers at the Democratic National Convention. Two weeks ago, Dole picked the fight in his address accepting the Republican presidential nomination, telling the National Education Association and the American Federation of Teachers: "If education were a war, you would be losing it. If it were a business, you would be driving it into bankruptcy. If it were a patient, it would be dying." In attacking union opposition to giving parents financial help to let them choose which schools their children attend and injecting what some see as capitalistic competition into the education system, Dole took on one of the most powerful forces in the Democratic party. He also staked out an issue of interest to young parents and turned the school choice debate into a major campaign batleground. About 550 of the delegates to this week's Democratic National Convention belong to one of the two unions, which together have more than 3 million members. The NEA says many of its members are Republicans, at least in name. Gore told the teacher-delegates on Tuesday they were being made scapegoats by Dole who instead should be concentrating on making public schools "the best in the world, bar none." "We oppose vouchers because we will not tolerate an assault on the financial structure of educational opportunity," Gore said. He called the school choice idea a "fradulent" and "misguided" concept that would drain funds from the school system. The room sizzled with hisses and boos every time he mentioned Dole and running mate Jack Kemp. One delegate hoisted a hand-lettered sign reading "mad and mobilized." The teachers unions have traditionally backed Democratic candidates at most levels, and Dole might not have been able to count on much support from that quarter in the first place. But union members said the attack has triggered an anger that has resulted in a unified front for President Bill Clinton. Mary Bergan, president of the California Federation of Teachers, said she was "very surprised" that Dole elected to single out the teachers unions for a special attack in his acceptance speech. "They had tried to make such a big deal of inclusion in that speech. They tried to make a distinction between teachers and their unions, which most people don't make and a lot of our members sure don't make," she told Reuters. "A lot of our members and a lot of NEA members happen to be Republicans, so he really solidified people, brought people over to Clinton in the education community for sure," said Bergan, who lives in Oakland, California. A poll meanwhile released in Washington by Phi Delta Kappa International, an educational fraternity, and conducted by the Gallup organization found that 61 percent of those polled opposed the idea of allowing students to attend private schools at public expense while 36 percent supported it. The group said a similar poll in 1995 showed 65 percent opposed and that the opposition stood at 74 percent in 1993. Clinton on Tuesday proposed a $2.75 billion literacy campaign for children that would involve hiring spcialists to to help communities provide extra reading help before and after school for 3 million children at 20,000 schools. The Dole camp fired back immediately, indicating it was not about to let the teachers unions off the hook. "Bill Clinton is admitting that our schools cannot accomplish the most basic task of literacy. But, instead of pursuing fundamental reform -- by confronting the teachers' unions and embracing school choice -- Bill Clinton announces a new government program and a new pot of money for the unions," the Dole campaign said. "By drawing education into the political discourse, Bill Clinton has drawn a clear distinction between Bob Dole and Bill Clinton. Bob Dole trusts the people. Bill Clinton trusts the NEA," it said. 3992 !GCAT !GODD Repeated warnings failed to keep Mayor Ron Weaver off the Hilaman Golf Course during the time it was closed and groundskeeper Mike Osley did what any seasoned professional would do. He turned on the sprinklers and gave the mayor a good soaking. Now Osley finds himself suspended for a week without pay in a case the mayor insisted had nothing to do with his position in the city. "I admittedly did it," Osley told the Tallahassee Democrat. "I wrote an apology. It was not a good decision." Golf course officials said they warned Weaver no one was allowed on the course outside business hours. But the mayor, who pays $800 a year to use the course, said he had been playing during off-hours for nearly a year. After his shower, a steamed Weaver said he approached Tallahassee's city manager as an ordinary citizen and demanded that Osley be severely punished. "The city should not allow a citizen to be subjected to bodily harm by an employee," Weaver told. City offices were flooded with calls and local radio stations began taking up collections for Osley on Tuesday as word spread of his suspension. Weaver, who is black, said getting doused while chipping was especially troubling because it brought back memories of the civil rights movement, when high powered hoses were used to disperse demonstrators. He did not return phone calls Tuesday. 3993 !GCAT !GHEA Fears that giving cow's milk to infants increases the risk of the child developing diabetes are probably unfounded, a study published on Tuesday said. Researchers at the University of Colorado at Denver found babies under the age of three months who consumed proteins found in cow's milk were not more likely to develop a type of autoimmune disorder that is an early predictor of diabetes. The authors of the study, which was published in this week's Journal of the American Medical Association, said it disputed previous reports that showed a 60 percent increased risk of diabetes from cow's milk. The Colorado researchers screened 253 children from 171 families identified to be at risk for insulin-dependent diabetes mellitus. No connection was found between cow's milk and the 18 cases of B-cell autoimmunity that were uncovered, study author Jill Norris said. Scientists do not understand what triggers autoimmune diseases, believing it to be an interaction of several genes and the environment, University of Florida pathologists Desmond Schatz and Noel Maclaren wrote in an accompanying editorial. "Cow's milk has many valuable nutrients and forms a critical part of the diet of many infants and children throughout the world. Thus, feeding practices that exclude cow's milk should not be adopted without a strong scientific indication. In our opinion, such an opionion has not been clearly established," they wrote. 3994 !GCAT !GWELF California Gov. Pete Wilson signed an order on Tuesday asking state agencies to implement quickly provisions in the new federal welfare reform act that cuts off aid to illegal immigrants, his office said. With the executive order, Wilson seized on a way to put into action measures similar to those of California's Proposition 187, the controversial law that would bar illegal immigrants from state welfare programmes. The law was approved by the voters in 1994 but is tied up in constitutional challenges. Wilson's executive order asked all state agencies, departments, boards and commissions to implement "as expeditously as reasonably practicable" the parts of the federal law pertaining to illegal immigrants. The federal welfare bill signed by President Bill Clinton into law this month allows states to exclude illegal immigrants from most benefit programmes, including Medicaid, Aid to Families of Dependent Children and Food Stamps. Wilson's order requires the state departments, agencies and boards to advise the governor of any action that can be taken to implement the federal welform reform act. Wilson, who made a short-lived bid for the Republican presendential nomination, has repeatedly criticised the Clinton administration for not doing more to stem the flow of illegal immigrants and attempted to get the federal government to reimburse California for his spending on immigrants. 3995 !GCAT !GHEA Surgical removal of a cancerous prostate gland produced excellent survival rates, especially when the malignancy was detected early, researchers said on Tuesday. In the University of Chicago study of nearly 3,000 prostate cancer patients in the United States and Europe, the men who underwent radical prostatectomy had a 10-year survival rate of between 77 percent and 94 percent, depending on the stage of the tumour when discovered. Between 52 percent and 87 percent of the men who underwent surgery were metastasis-free after a decade. In some cases, particularly with elderly patients, doctors choose not to perform surgery and instead adopt a "watchful waiting" strategy where the cancer is monitored for spread. Study author Glenn Gerber cautioned that many factors precluded a direct comparison of data on the two courses of treatment. The American Urological Association said the study, which appeared in the Journal of the American Medical Association, helped clarify the best treatment for prostate cancer, and underscored the importance of early detection. 3996 !C13 !C33 !CCAT !GCAT !GSPO New York City Mayor Rudolph Giuliani took a swing Tuesday at the U.S. Open, saying the city's deal to host the popular tennis tournament is dangerous because it requires planes to be rerouted away from the tennis courts. Under terms of the contract with the U.S. Tennis Association, planes in and out of nearby LaGuardia Airport must not disturb matches on the courts at Flushing Meadow, where the two-week tournament began Monday. "The provision on flyovers is an outrage," Giuliani said at a City Hall news conference. "The lease is a danger to public safety." The city faces fines of up to $325,000 if it does not divert the planes, officials said. Arlene Salac, a spokeswoman for the Federal Aviation Administration, said the agency in a long-standing practice reroutes planes when it can to spare the tennis below, but she said it has never posed a safety risk. "It's not anything that poses an unsafe situation and, if it was going to, we would not be doing it," she said. Some 1,100 planes land and depart from LaGuardia every day. Salac said she did not know how many would be diverted due to the annual tennis tournament. The deal with the USTA was negotiated by Giuliani's predecessor, former Mayor David Dinkins, an avid tennis player and fan. The lease keeps the US Open, often criticised as having the least glamorous facilities of all the Grand Slam tennis tournaments, in New York City at least until 2020. Under terms of the lease, the USTA uses 42 acres of city parkland as its National Tennis Centre in the city's Queens borough. In exchange it was to pay for a $172 million expansion, including a new 23,500-seat stadium scheduled to open in time for next year's tournament. The current stadium was built originally for the 1964 Worlds Fair. 3997 !GCAT !GDIP !GVIO The United States urged a rebel group in south Sudan on Tuesday to bring about the immediate release of six Roman Catholic missionaries, one of them a U.S. priest, held by a rogue commander for 10 days. Senior officials of the Sudan People's Liberation Army (SPLA), the main rebel group in the south, are "cooperating closely" with the United States and others in efforts to free the detainees, the State Department said. "We remain very concerned for the safety of the American citizen and the other missionaries, and we call upon the SPLA to take all necessary measures to guarantee their safety and effect their immediate release," department spokesman Glyn Davies said. The department did not identify the U.S. priest because of privacy concerns. But the Catholic Information Office in Nairobi named him as Michael Barton, 48. The office said four of the six detainees had been charged by the SPLA with spying, spreading Islam under a Christian cover and hindering recruitment into the rebel group. The SPLA has fought Khartoum government forces in the south since 1983 for greater autonomy or independence of the mainly Christian and animist region from the Moslem, Arabized north. In Nairobi, George Garang, an SPLA spokesman, said his group was urgently trying to contact SPLA commander Nuour Marial at Mapourdit, the southern town where the six were being held. "The movement is making arrangements for them to be set free. This is a decision of the leadership," Garang said. 3998 !GCAT !GDIS Almost an entire block of scaffolding collapsed in midtown Manhattan Tuesday, injuring 10 people, five of them seriously, authorities said. The pile of framing, corrugated metal, bricks and sacks of cement also buried cars that were parked along East 44th Street, just one block away from the landmark Grand Central Terminal train station. The scaffolding, which ran along the second floor of an office building, collapsed just before 3 p.m. EDT, fire department officials said. Of the 10 people injured, five were taken to nearby Bellevue Hospital and the rest were being treated at the scene, authorities said. They did not say whether the injured included only pedestrians. The collapse snarled traffic along the nearby busy avenues and side streets. 3999 !GCAT !GDIS Authorities evacuated this southeast Oklahoma town Tuesday as a precaution against a fire that burned in a warehouse containing fertilizer and agricultural products. An official at the Webbers Falls Fire Department said there had been no injuries among the town's approximately 750 inhabitants. The fire was detected Tuesday morning at the Farmers Export Elevator, which is owned by Guthrie Corp, a privately-held company based in Guthrie, Okla. A senior official with Guthrie Corp said he was not certain whether the fire was still burning Tuesday afternoon, but said the blaze appeared to have been caused by lightning earlier in the day. The official said the town had been evacuated because of concerns that the fire might causing an explosion in the urea and diammonium phosphate fertilizers contained in the warehouse. He said the warehouse contained about 1,000 tonnes of soybeans, corn gluten beans and fertilizer, and that the building's total capacity was between 20,000 and 25,000 tonnes. "It was practically empty," the official said, adding that the building had suffered a "total loss." He declined to comment on the dollar amount of the damage. The official, who wished to remain anonymous, said the fire had not damaged any of the surrounding grain elevators. "Our grain elevators are intact. They have not burned and have received absolutely no damage," he said. Other local authorities were not immediately available for comment on the state of the fire.