newsobserver.com Saturday, February 15, 2003 6:11PM EST By MIKE MEYERS, MINNEAPOLIS-ST. PAUL STAR TRIBUNE

(SH) - Same desert. Same armies. Same threat of battles to come. Don't count on history repeating itself, however. Especially when it comes to investing money against a backdrop of war.

In the months before Operation Desert Storm in January 1991, U.S. stock prices sank. But once victory seemed assured, the markets turned around. It was the start of the longest bull market in history - and the most enduring period of economic prosperity on record.

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Minneapolis-St. Paul Star-Tribune But just as generals sometimes make the mistake of fighting the last war, investment advisers today warn against thinking the market will behave the same way in a 2003 confrontation with Iraq as it did in 1991.

"Normally the market goes down, then rallies during war, and a year later it's higher," said Phil Dow, market strategist at RBC Dain Rauscher, who has studied stock market trends in war and peace dating back to 1926.

"This time I don't know," Dow said, cautioning against expecting a repeat of the past, in which market euphoria followed wars. A return to normality in the stock market cannot be considered a fait accompli if there is a protracted war in the Middle East.

The paradox behind his worry: "Uncertainty has bred the certainty that only bad things can happen," Dow said.

Others agree.

"If it looks like we're going to win quickly with few casualties, maybe history will repeat itself," and good times will roll again, said Matt Norris, portfolio manager at Advantus Capital Management.

However, if the United States gets sucked into a military quagmire, the stock market could sag even more than it already has. The 1970s were dreary years for investors as inflation rates soared and the nation pursued a "guns and butter" plan that essentially deferred paying the financial costs of the Vietnam War.

"The historical parallel may be Vietnam, (only) much more costly in terms of lives and money and no clear resolution," Norris said.

Patrick Hagan, senior financial adviser at American Express Financial Advisors, said the run-up to a possible war in 2003 has been longer than the suspense before the 1991 conflict. Hesitation has a price for investors, he said.

"We all dislike indecision," Hagan said. "When we're left up in the air, we always think of the worst possible outcome."

Even if all goes well in the Persian Gulf, Hagan doubts stock prices will recover from three years of back-to-back losses any time soon.

"I don't think we'll all of a sudden be back where we were in 1999," he said.

Said Bruce Bittles, at the Milwaukee-based brokerage firm Robert W. Baird & Co., "What we're telling our people is that though this looks much like 1990-1991, that the market rarely reacts the same way under the same circumstances."

The lesson of the Persian Gulf War was that once the shooting starts, the stock market can soar as investors shake off fears.

That may happen again. But what are the risks that it won't?

Stock market watchers cite many differences between then and now:

• A cornered Saddam may be more likely to inflict large casualties with chemical or biological weapons, and a protracted war with many casualties heightens uncertainties and makes the markets quake.

• Fears of domestic terrorism in the wake of a Mideast conflict were nonexistent in the early 1990s. Today, such fears are rampant and have a chilling effect on investor confidence.

• The U.S. probably would garrison Iraq for years to come after an armistice, raising the cost of the military conflict long after the battlefield is quiet. The peacekeeping phase of war is risky, and that could continue to rock investor confidence.

"It sounds like we're making some kind of commitment to provide freedom for Iraq," Dow said. The reaction in peacetime Iraq may be gratitude - or hostility from cliques competing for power: "A receptive crowd or a minefield of ethnicity," he said.

Many investment advisers are telling clients to stick to investments in well-run consumer products companies such as Procter & Gamble, General Mills or Coca-Cola on the theory that people still will eat, drink and use Kleenex in times of war or peace.

But investors willing to take more risk, market watchers say, are betting on the stocks of oil companies, which will benefit if oil prices spike in a drawn-out war, or hotel and other travel-related firms, which could rise if the war ends quickly.

"Our clients are just suffering," said Dow, at RBC Dain Rauscher. "They're between a state of denial and absolutely considering staying out of the market forever."

www.dailytelegraph.co.uk (Filed: 16/02/2003)

For Britain and the US, war without UN backing has suddenly become a real prospect report by Julian Coman in New York and David Wastell in Brussels.

Once a week, Olivier Goulot, a diplomat at the French mission to the United Nations, takes his lunch at the Manchester Pub near his New York office. Recently he has become a little suspicious of Anglo-Saxon strangers.  

Jack Straw shares a light moment with Dominique de Villepin before Colin Powell's presentation on Iraq

"We have all got direct orders from the ambassador to keep quiet about Iraq," says Mr Goulot. "Although it's not an easy task. The French are being called 'weasels' in the American press and people are even thinking about a boycott of Perrier."

Nevertheless, after a traumatic week opposing war at the United Nations Security Council and suffering the abuse of the New York Post, Mr Goulot was willing to offer a word of pity for Tony Blair and Jack Straw, the Foreign Secretary, who have had an even worse few days: "Your Government thought that there was a middle ground that could allow it to be with both Europe and America in dealing with Saddam. He [Tony Blair] thought he could rein us in and rein the Americans in. But the middle ground is giving way beneath your feet. Now we all have to choose - Mr Blair included. War with the US or inspections with the UN?"  

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On Friday, at one of the most tumultuous United Nations Security Council meetings since the Cuban missile crisis, the French foreign minister, Dominique de Villepin, put a similar choice before the council's 15 member states after the second report on Iraqi disarmament by the UN chief weapons inspector, Hans Blix.

"Do we consider in good conscience that disarmament via inspections is now leading us to a dead end?" said Mr de Villepin. "Or do we consider that the possibilities regarding inspections have not been fully explored?"

One by one, as the US Secretary of State Colin Powell and Mr Straw exchanged tight-lipped smiles across the chamber, 12 of the 15 delegates expressed a desire to continue with inspections. Mr Powell threw away most of his notes and ad-libbed to no avail. He talked of "tricks" by Saddam. He told fellow Security Council members to "hold their nerve" when dealing with "a tyrant".

The German foreign minister, Joschka Fischer, and Mr de Villepin listened with folded arms. Igor Ivanov, the Russian foreign minister, invoked the spirit of St Valentine's Day as an inspiration for peace and received a round of applause. Mr Powell looked both tired and furious.

A successful second resolution, unleashing the "serious consequences" foretold by November's Resolution 1441 if Iraq fails to disarm, suddenly looks an extremely tall order. To pass a new resolution the US would require nine council votes.

On Friday, it could count on Mr Straw and Ana di Palacio of Spain. Even Bulgaria, previously a staunch ally on the council, expressed strong support for ongoing inspections. Angola, Guinea, Cameroon and Chile all said more or less the same. Russia, China and France established a 3-2 lead for continued inspections among veto-holding council members.

Outside the Security Council Chamber, in corridors where US officials have briefed and cajoled delegates for months as they urged them to get tough on Iraq, recriminations and inquests were already beginning among State Department officials.

Hans Blix had "ducked the hard language on non-compliance", according to one Bush administration official. Another said: "The news that Iraq had an illegal ballistic missile programme, confirmed by the UN, came out a day too early. It had no impact when Mr Blix said it because it was already in the papers. The way that happened was a mess."

Mr Straw failed to appear at all during the course of the day, although he made time for an urgent private meeting with Mr Powell. British officials talked confidently of a second resolution to be circulated by the middle of next week. But among both American and British diplomats, the dramatic prospect of a war with Iraq without United Nations backing had suddenly become real.

"Patience has gone and time's up," said a State Department official, "the UN has to decide whether it's coming along because a coalition of the willing, led by America and Britain, are going anyway."

In London, there is also a concerted attempt not to blanch at the prospect of war without a second resolution. "The Prime Minister is absolutely adamant that there would be no legal problem in going to war with Iraq without a second resolution," said a senior Downing Street official. "The second resolution is desirable for political and diplomatic reasons, not to give a legal back-up. Everything Britain needs to go to war is already contained in Resolution 1441, which authorises 'serious consequences' in the case of Iraqi non-compliance."

A delay in going to war can be countenanced and may even be advantageous. The American military insists that its equipment allows a war to be fought as efficiently in the spring or early summer as it could be now. Crucially, the 101st Airborne Division has only just set sail from the US and will not arrive in Kuwait for three weeks, at the end of the first week in March, at which point the complete invasion force will have been assembled.

The logistics of battle are unaffected. But it is the possible collapse of the fabled "UN route" to disarming Saddam that has darkened the mood in Washington and London. On Friday, no one in the State Department was looking forward to going back to Washington, where Donald Rumsfeld, the Secretary of Defence, and Dick Cheney, the Vice-President, who were loath to let the entire inspection process begin, are no doubt waiting to say 'I told you so'.

"This was a very bad day for us," said one senior aide, "We're at the turning point here. The Secretary of State has to go back to DC and a decision is going to be made as to whether we table a second resolution on Iraq, endorsing force, or we go another route. That's where we are now. Minds have failed to gel here."

The bad day followed a terrible week for those who wanted to sign up multinational bodies to the war effort. Warning signs of confrontation to come, and a climactic showdown with France, had been visible earlier in the week, in the drab Brussels offices of another venerable international institution - Nato.

At Nato headquarters, a converted hospital on the outskirts of Brussels, a request was made earlier this month on behalf of Turkey, a Nato member, for Patriot missiles, Acwas surveillance planes and defensive equipment against nuclear, biological and chemical weapons. It was explained that as a base for US troops during a future war with Iraq, Turkey would be vulnerable to attack during a conflict.

To the astonishment of their 16 fellow Nato members, France, Belgium and Germany said no. To say yes, said Jacques Chirac, the French president, would amount to accepting that the war with Iraq was inevitable before the UN had decided that was the case. The UN "trap" - interminable diplomatic wrangling - so feared by Washington's hawks, turned out to have been secretly laid in Nato headquarters as well.

Mr Rumsfeld said the decision not to come to the aid of a fellow member was "inexcusable" and placed the credibility of Nato on the line. In Brussels, the rows that ensued were among the most bitter in the organisation's history.

In Room 1 - the secure, windowless, beige-walled venue for gatherings of the North Atlantic Council - ambassadors from Canada, Britain, the Netherlands and Norway unleashed their anger at the "gang of three". The newly-founded "Brussels Resistance", a sister movement to the anti-war French diplomats in New York, were accused of "abject failure" to live up to their responsibilities under the Nato treaty.

Another said they were "reneging on their obligations". A third ambassador pointed to the trio and told them: "You are doing grave damage to the alliance."

Astonished eastern Europeans watched the organisation that they had fought so hard to join apparently on the verge of disintegration. "The scars will be lasting as this stand-off has gone too deep for too long," said Karel Kovada, the Czech ambassador to Nato. "We are getting dangerously near to the bone now. It will leave scars on the body of Nato, to the detriment of us all."

The French and the Germans appeared not to care. "You now have a split in Nato, not just in Europe, over Iraq," said Franois Heisberg, a former French Defence official and director of the Paris Foundation for Strategic Research. "It's being extended into the strategic realm. When the key players consider the alliance marginal, you know you have a real crisis. A crisis of indifference."

Nato argued itself to a standstill early in the week, satisfactorily delaying war preparations on the military front as far as Paris and Berlin were concerned. Franco-German attention switched to New York, where Mr Blix was due to deliver his report on progress in disarming Iraq at the end of the week.

The Bush administration was doing its utmost to ensure that the report would concentrate minds in the Security Council on continued Iraqi violations and defiance of inspectors. Drafts of a possible second resolution, authorising the use of force to disarm Iraq, flew all week between the United States and United Kingdom missions.

In response, the French circulated a so-called "non-paper" for discussion among Security Council members, advocating an expanded and strengthened inspections regime in Iraq. The battle for influence was waged daily.

According to an African diplomat the overwhelmed delegates of countries such as Guinea and Angola "just tried to keep their heads down until the big boys reached agreement".

There was no agreement to be had. On Tuesday, Condoleezza Rice, the National Security Adviser, visited Mr Blix's compact offices in the UN building to urge him to "report the facts".

"She also told him that a certain kind of language might be a problem," said a US government official. "We wanted to make sure he wasn't going to be amazingly upbeat about aspects of compliance from the Iraqis such as the agreement over U2 surveillance flights."

Yet as Ms Rice grilled Mr Blix, the rules of the latest round of the contest between hawks and doves were being subtly but significantly altered. Ms Rice was under the impression that the Friday meeting would be a closed session involving permanent UN representatives. Mr de Villepin and his ally, the German foreign minister Joschka Fischer, had developed a rather more grandiose vision of the session. Friday was to be the setting for Mr de Villepin's finest hour.

Three weeks earlier, Mr Powell had been notoriously "ambushed" by Mr de Villepin at a UN counter-terrorism meeting. The meeting, apparently innocuous, was used to make the French case against war even before Mr Blix had made his first report.

Now, on the occasion of Mr Blix's second report, the United States and Britain were to receive another lesson in playing the politics of an international bureaucracy.

On Wednesday, at a closed planning meeting for the Blix report, French and German representatives announced that Mr de Villepin and Mr Fischer wished to attend the Friday session. The American ambassador to the UN, John Negroponte, groaned at the prospect of the third visit by Security Council ministers in three weeks: "Here we go," said Mr Negroponte, "the weekly ministerial meeting coming to town."

In Washington, Mr Powell belatedly decided that if Mr de Villepin and Mr Fischer were going to be there, he needed to be there, too. Mr Straw made the same decision.

The determined obstructionism of France was now becoming a concern to both Britain and the US. In Washington and London, there was a growing feeling that Mr Chirac and his foreign minister might be eyeing the possibility of a "Gaullist moment", which could even go as far as a Security Council veto.

"Blair said he was struck by how hard line Chirac was when they last met," said a former White House official close to the present administration. "If France was in that mood, and Germany could tag along behind, there was always a danger that Russia could swing against the use of force as well."

The French and German foreign ministers, having ensured a prestigious turn-out of ministers, then set about organising an audience. It was suggested that half the day be taken up with an open media session.

Russia and China, both of which had sided with the earlier French call to strengthen and prolong inspections, enthusiastically endorsed the idea. "This was very clever," said a senior Security Council diplomat. "Where there are ministers there is always going to be posturing. It's not going to be the same kind of serious, sober work. And when you put the ministers on public display, with the whole world watching, you get something of a circus."

US and British officials warned that the new format would allow little time for closed debate and little opportunity for proper candour in debate. It was, said officials privately, simply a delaying tactic.

There was however, another motive. "Of course we wanted to make it public," said a French government official. "It's the public that's against the war. In London you were about to have one of the biggest anti-war demonstrations in your history. Seventy-five per cent of Spaniards are against going to war with Iraq, and so on. We let the people into the debate."

In his eventual report, Mr Blix listed aspects of the progress in Iraqi co-operation with the inspectors. He also pointedly minimised the significance of evidence presented to the Council by Mr Powell on February 5. Following Mr Powell's presentation of secret US intelligence which he claimed demonstrated Iraqi defiance of the UN, there were rumours in New York that the chief weapons inspector had resented the eagerness of the Secretary of State to prove the futility of Mr Blix's inspections regime.

On Friday, back in the chair, Mr Blix confirmed his suspicions when he delivered a public and stinging rebuttal of one of Mr Powell's major "scoops" - satellite images of alleged decontamination trucks indicating the presence of a chemical weapons factory.

Mr Blix was polite but withering, commenting: "The reported movement of munitions at the site could just as easily have been a routine activity as a movement of proscribed munitions in anticipation of imminent inspection." The packed hall murmured audibly. Mr Blix was not taking the game to Iraq. He was taking it to General Powell.

He appeared to end his presentation by calling for more time. The caustic tone of January 27, when Mr Blix had poured scorn on the idea of inspectors playing a game of "catch as catch can", had gone.

In the private afternoon session that followed, an exasperated Mr Straw challenged Mr Blix to explain why so few scientists would agree to private interviews without witnesses. He then answered his own question: "Because they are in fear of their lives!"

Mr Blix was also repeatedly asked: "Can you say that the Iraqis were showing full active compliance in accordance with 1441?". "He ducked that question," said a senior diplomat present, who added that the chief weapons inspector was simply "hoping against hope". But the damage to the Anglo-American case had already been done.

Mr de Villepin's carefully planned moment of oratory brought the house down. Calling for a further report by inspectors on March 14, he insisted that France would "never cease to stand upright in the face of history and pledged to give "priority to disarmament in peace". The audience and a sizeable section of the press corps, applauded. Mr Powell had been ambushed again.

Mr Blix is back before the UN Security Council again on March 1 at the latest, as part of a timetable linked to a previous Iraq resolution. In British and American eyes, this may well be the last chance for the UN route that began with President Bush's address to the UN on September 12.

If a second resolution is tabled at all, it will come well before the Blix meeting. If the foreign ministers are assembled yet again at that point, it will be to say yes or no to the use of force. But after a traumatic week, President Bush may not wish to wait any longer and Mr Blair may not feel that there is any point.

For now the Resistance is jubilant. Outside the Security Council meeting, a French diplomat joked: "Next we have an EU council meeting on Monday [tomorrow]. If we win the debate there, too, it will be a triple: Nato, the UN and the EU. It's a good week's work."

www.dailytelegraph.co.uk (Filed: 16/02/2003)

If readers find the headline above familiar, it is because it appeared above a leading article published by this newspaper in October 2001. A week after the launch of Allied raids on Afghanistan, we argued that those claiming that the campaign would lead to a protracted, pointless slaughter were wrong. The rapid collapse of the Taliban removed one of the world's most barbarous regimes, and one theologically committed to harbouring terrorists. Its extinction was an unalloyed good, especially for the Afghan people.

A year and a half later, Britain and America stand on the verge of another war, against a regime with a much longer record of sustaining and equipping terrorist groups. Again, the likely military campaign faces a cacophony of opposition: the thousands who marched through London yesterday to protest against war on Iraq were making exactly the same case as was advanced during the Afghan conflict and, in 1999, the Kosovo war. They had, and have, every right to express their dissent. But the cost of that right is to face scrutiny themselves.

The Prime Minister was right to say yesterday that - if, hypothetically, the marchers got their way - "there are consequences paid in blood for that decision too. But these [Iraqi] victims will never be seen. They will never feature on our TV screens or inspire millions to take to the streets. But they will exist nonetheless".

Iraqi exiles were conspicuous by their absence from yesterday's protest. Their position was well expressed by a letter in Thursday's Guardian from Dr B Khalaf, an Iraqi locum consultant in London, who wrote: "My family and almost all Iraqi families will feel hurt and anger when Saddam's media shows on the TV, with great happiness, parts of Saturday's demonstration in London. But where were you when thousands of Iraqi people were killed by Saddam's forces at the end of the Gulf war to crush the uprising?"

Saddam must have taken further comfort from the desperate scenes at the United Nations on Friday, as the supposed "global court" descended into a Babel of juvenile point-scoring. It was easy to forget the clarity of the situation: paragraph 13 of UN Resolution 1441 states explicitly that Iraq "will face serious consequences as a result of its continued violations of its obligations".

Hans Blix's report last week said that compliance with these obligations meant "more than opening doors". Iraq had to "squarely tackle this task and avoid belittling the questions". In his report on January 27, Dr Blix noted that 6,500 chemical bombs, stocks of anthrax and VX nerve agent, 3,000 tonnes of precursor chemicals, 360 tonnes of bulk agents for chemical weapons and 30,000 special munitions for the delivery of such agents were unaccounted for.

This remains the heart of the matter. On Friday, Dr Blix hailed as a "positive step" the decision of the Iraqi Parliament - if that body deserves to be so described - to "ban" weapons of mass destruction and "welcomed" the news that Saddam has set up commissions to search for such weapons. One can only hope that Dr Blix's dry delivery was meant to be parodic. If, as Saddam claims, Iraq has no such weapons, why does it need to ban them, or launch inquiries to find them?

As Sir Jeremy Greenstock, the British Ambassador to the UN, said on the BBC's Today programme yesterday, not one of the foreign ministers who applauded their French colleague on Friday believes that Saddam has complied with his disarmament obligations. The problem with the present impasse at the UN, however, is that the Iraqi dictator must now surely believe he has three options, rather than two: not just to disarm, or to face war, but also to string along the UN even longer.

There was an outside chance that war would be avoided by Saddam and his family fleeing Iraq: the antics of the French and Germans have reduced that chance almost to nil. Those nations which have been most vociferous about the UN are now doing least to ensure its continued credibility. On Friday, that body looked almost as painfully irrelevant as the League of Nations in the late 1930s.

Many in Europe, used to the soothing tones of Bill Clinton, find President Bush's Texan rhetoric unsettling and, in some cases, obnoxious. They should remember that the President's language is designed to appeal to an American audience still afflicted by the atrocities of September 11. It should also be remembered that Mr Bush has not remotely lived up to the stereotype of the trigger-happy cowboy: it was Mr Clinton who tended to fire off cruise missiles instantly when faced with an aggressor. President Bush, in contrast, has shown patience during the war on terrorism, and deserves more credit for that than most on this side of the Atlantic are prepared to give him.

What the opponents of war must remember is that the prospective conflict in the Gulf is not about America's financial ambitions. Nor would it be a war on Iraq. It would be a war on Saddam. In the past 12 years, the Iraqi dictator has shown that he has nothing but contempt for international law, for UN resolutions, for UN inspectors, for the liberties of his own people.

He has defied repeated demands that he account for lethal weaponry which could cause unimaginable horrors. At the same time, he has strengthened his connections with terrorist groups. The Bush administration's campaign to prove a link between Saddam and the events of September 11 is politically understandable but is a distraction from a greater argument.

The point is not that Saddam and Osama bin Laden are allies - they are not - but that the Iraqi dictator, a deceitful, tyrannous psychopath, has shown time and again that he is willing to use any means at his disposal to harm his enemies and to aid terrorist groups which would do the same. Are those who marched through London yesterday truly confident that Saddam will not pass weapons of mass destruction to such groups if he is able so to do? How can they possibly believe that the answer is yet more inspections, yet more delay, yet more postponement of the moment of reckoning?

In truth, that moment of reckoning is upon us. It is a bleak prospect, and it is insulting that the marchers assume that those who accept the necessity of war do so with anything other than a heavy heart. But those at yesterday's rally, and the national governments doing their best to obstruct military action, have failed to explain what they would do to make the world and the Iraqi people safe from Saddam's psychosis. On the day that Baghdad is liberated, as the full story of his horrific rule and the terrors that he inflicted becomes clear, will they march in celebration with the same passion as they protested yesterday?

www.chinapost.com.tw 2003/2/16 TAIEPI, Taiwan, The China Post staff

About 300 people staged a protest yesterday outside the U.S. representative office in Taipei to speak out against Iraq human rights violations and a possible U.S.-led war on Iraq.

The protest, organized by a Taiwan human rights promotion group, gathered at the building of the Bureau of National Health Insurance Bureau, before heading to the Taipei office of the American Institute in Taiwan (AIT), which represents U.S. interests here in the absence of formal diplomatic ties.

The demonstration was part of a global string of anti-war protests which took place simultaneously in all major cities around the world.

Since the organizers didn't apply for a permit to march, police repeatedly asked demonstrators to end their protest.

Rows of police with batons took up positions outside the AIT office, but there was no trouble and protesters dispersed after two hours.

Most protesters were labor activists but they also included foreign residents, ranging from veiled Indonesian women to Arab men and young Westerners. They held placards with slogans like "We need peace, no war," "No war on Iraq," and "War does not decide who's right, only who's left."

One man wearing a Bush mask carried a plastic gun and a blue plastic barrel with the inscription "Bush Oil: 50 percent oil, 50 percent blood."

Expressing his personal opinion, Stuart Hamby, a U.S. citizen, said that it would be "a useless war." He said Bush was seeking to place more wealth into the hands of his friends whose businesses are in oil and defense.

Organizers of the demonstration said that they oppose the Iraqi government's policy of cracking down on human rights. But they stressed that peaceful resolution of the Iraqi arsenal issue through U.N. efforts is the best course to take to end the controversy. Some speakers criticized the Taiwan government, saying it was taking a soft attitude toward the Bush administration.

More than 100 private associations in Taiwan have reportedly signed a global anti-war declaration initiated by European anti-war activists.

The government has expressed support for the U.S.-led war on terrorism, but not yet taken an official stance on the Iraq issue.

www.chinapost.com.tw 2003/2/16 ASSISI, Italy, AP

Iraqi Deputy Prime Minister Tariq Aziz urged the world to "resist war and the intentions of aggression" during a visit Saturday to this hilltown known for its messages of peace.

Aziz, a Chaldean Christian, participated in a series of peace prayers with Franciscan friars on a day that demonstrations took place around the globe to protest a possible war against Baghdad.

"My message is peace," Aziz said outside the Basilica of St. Francis after the prayer. "The people of Iraq want peace. And millions of people around the world are demonstrating for peace, so let us all work for peace and resist the war and the intentions of aggression."

Outside the basilica, the word "PAX" °X Latin for "peace" °X was written with shrubs in a flowerbed.

The Rev. Enzo Fortunato, a spokesman for the Franciscans, said Aziz's visit to the tomb of St. Francis was important because "the world needs images of peace to conquer the images of war."

When asked whether Aziz might use the visit for political purposes, Fortunato replied: "Whoever comes to Assisi can call himself a man of peace, but he is called to realize, with concrete gestures, that which he proclaims."

Aziz insisted after meeting with Pope John Paul II on Friday that Iraq had no weapons of mass destruction and, after the latest report from U.N. weapons inspectors, promised greater cooperation with arms searches.

The pope has been outspoken in his opposition to any new war but has also insisted on Iraqi compliance with U.N. resolutions. He dispatched his envoy, Cardinal Roger Etchegaray, to Baghdad this week with a personal message for Iraqi President Saddam Hussein.

Etchegaray met with Saddam on Saturday and said afterward that the Church was serving as the "moral conscience" of humanity in opposing war and insisting on a peaceful outcome of the crisis.

"For ultimately, it is conscience that will have the last word, stronger than any strategy, ideology, and even every religion," he said in a statement released by the Vatican.

At a press conference Friday, Aziz warned Europeans against supporting Washington in any war against Iraq, saying the impact would be felt across the Arab world.

"When anything happens in Europe, it affects us in the Middle East, in the Arab world," he said. "Therefore, the Europeans should be very careful when they say 'we support George Bush' because they encourage him to do mischief, to make aggression. They should not."

On Saturday, Aziz took part in the simple ceremony at the tomb of St. Francis, an intimate, stone chapel decorated with fragrant lilies underneath the lower basilica of the main church.

Assisi has long been associated with St. Francis' message of peace and the pope last year held a daylong, inter-religious peace prayer service in Assisi in the aftermath of the Sept. 11 attacks.

In the ceremony, Aziz joined the clergy in two symbolic gestures: holding an oil peace lamp and being shown an ivory horn that was presented to St. Francis in 1219 by the then sultan of Egypt, Melek el-Kamel.

The lantern was the same one used by participants in the pope's peace day and recalled his message urging all believers to be "lights of peace," while the horn is a symbol of friendship between peoples, the Franciscans said.

"We are convinced that war has never resolved the problems of humanity," Assisi Bishop Sergio Goretti told the small gathering. "We condemn every form of terrorism ... and the construction of weapons of mass destruction."

Aziz also signed a book on the altar that the Franciscans said was a commitment to peace, writing: "May God the Almighty grant peace to the people of Iraq and the whole world. Amen."

Those gathered then read a prayer issued by John Paul last year in Assisi: "Violence never again! War never again! Terrorism never again! In God's name, may all religions bring upon earth justice and peace, forgiveness, life and love."

Aziz joined the friars for a lunch of cheese pastry and fennel salad, ravioli with truffles °X a specialty of the region °X veal with artichokes, salad, fruit and sweets. He then took a private tour of the spectacular frescoes in the upper basilica.

Aziz is due to leave Italy on Sunday.