usinfo.state.gov 13 January 2003

(White House Report) (830)

BUSH HAS PUT NO "TIMETABLE" ON U.N. INSPECTIONS IN IRAQ

President Bush "has not put a timetable" on how long the United Nations weapons inspections in Iraq should continue, White House Press Secretary Ari Fleischer told reporters January 13, following news reports that the inspectors said their work could take as long as a year.

"The President has not put any type of artificial timetable on how long he believes is necessary for Saddam Hussein to prove to the world that he's going to comply," with United Nations Security Council demands that Iraq disarms itself of any weapons of mass destruction, Fleischer said.

Bush "has made it very clear that the role of the inspectors is a very important part of this process. The inspectors need to be in Iraq to do the job that the world has asked them to do. And they're in the middle of their work," said Fleischer.

The inspection process, he pointed out, "included a series of dates that the inspectors would report back" to the U.N. Security Council. "We're not even through those dates yet. An important one is coming up January 27th. So, I think, frankly, other than it's a slow news day, nothing really has changed about the timing in Iraq," Fleischer said.

When asked if the U.S. military troops being sent to the Gulf could be waiting there as long as a year, Fleischer responded that "the President has not put a timetable on it. And if the President hasn't put a timetable on it, I certainly won't."

WHITE HOUSE SAYS ITS POLICY ON NORTH KOREA CONSISTENT

Fleischer reconfirmed the U.S. position that North Korea must comply with its international obligations before progress can be made on other fronts.

He noted a January 13 statement at a press conference in Seoul by U.S. Assistant Secretary of State James Kelly, in which Kelly said "Once we get beyond nuclear weapons, there may be opportunities with the U.S., with private investors, with other countries to help North Korea in the energy area."

"So the ball remains in North Korea's court. They know what they need to do and they need to take that action," Fleischer said.

"North Korea wants to take the world through its blackmail play book, and we won't play. It's up to North Korea to come back into international compliance with their obligations. If and when they do that, then the world, of course, would make clear to North Korea that ... the world was prepared to engage," Fleischer said.

"(W)hat we've always said is that North Korea needs to come back into compliance with international obligations. If they do not come back into compliance with international obligations, they'll continue to isolate themselves. And that begins with North Korea's dismantlement of its programs for the development of nuclear weapons."

The United States, the Press Secretary added, "is prepared to talk to North Korea. And the message is simple, that North Korea needs to take action to disarm.... There is a perfect consistency here. Mr. Kelly said that once we get beyond their nuclear weapons then there may be opportunities in the front in the area of energy.

"But as I made clear before, I said the United States is willing to talk, not negotiate. We are willing to talk about North Korea dismantling its facilities and coming back into international compliance with their obligations. Having done that, once they do that, then, at that point, North Korea can resume its place as a sovereign nation that is respected and treated by other nations in a manner consistent with their resuming those international obligations," Fleischer said.

BUSH VIEWS AS WELCOME STEP OPEC DECISION TO INCREASE PRODUCTION

Asked to give the Bush administration reaction to the Organization of Petroleum Exporting Countries' decision to increase production, Fleischer said President Bush "views OPEC's action to increase production, particularly given the protracted dispute in Venezuela, as a welcome step. It will increase global energy supplies and support global economic growth. The President views this as a welcome step."

Asked how much the oil strike in Venezuela is affecting the U.S. economy, Fleischer said "you can talk to any number of economists and get any number of different answers about it, particularly given the fact that OPEC is going to take this action that is, as I indicated, a welcome step that does address the situation in Venezuela."

"Ultimately, the markets will be the determinant of whether or not it's sufficient. But obviously, the President views this as a welcome matter," Fleischer said.

The Organization of Petroleum Exporting Countries agreed January 12 to lift output by 7 percent beginning February 1 to compensate in part for an estimated two-million-barrel-a-day Venezuela output reduction because of the strike.

(Distributed by the Office of International Information Programs, U.S. Department of State. Web site: usinfo.state.gov)

www.inq7.net Posted: 8:59 AM (Manila Time) | Jan. 13, 2003 Agence France-Presse

CHICAGO - The death penalty is either formally banned or has fallen out of use in 111 countries out of 195, and those using capital punishment are increasingly reluctant to do so, according to Amnesty International. Some 40 countries have dropped the death penalty in the past 20 years, added the London-based rights group, which opposes it. Data from the World Coalition against the Death Penalty indicates some 76 countries have totally abolished the death penalty, 14 others abolished it for civil crimes only and 21 have abolished it in practice.

In Europe, Russia retains the death penalty for civil offenses though it signed a protocol in 1996 promising to eliminate it in order to secure membership in the Council of Europe.

But faced with the Russian Parliament's reluctance to approve the legislation, President Boris Yeltsin issued a moratorium on judicial executions in 1996.

On August 3, 2002 Turkey abolished the death penalty for civil crimes only, but maintained it for exceptional crimes such as those under military law or crimes committed in exceptional circumstances.

In Latin America, Cuba stands out as the only country that uses capital punishment. Other countries have entirely abolished it or, like Mexico, only maintain it for treason in time of war or for the assassination of a president.

Guatemala has suspended all executions while waiting for the legislature to vote a bill introduced last July to abolish the death penalty.

The last official executions in Latin America took place in 1985 in Chile and Peru in 1979. Venezuela, the fist abolitionist country in South America, has not executed anyone since 1863.

However 84 countries still maintain capital punishment.

China is by far the country that executes the most but no official data or statistics exist on the subject.

The US stands out since it reinstated capital punishment in 1976. Since then more than 800 people have been executed and at least 3,500 people are on death row.

Recent executions have taken place in Iran, Saudi Arabia, Sierra Leone, Taiwan and Rwanda.

sg.biz.yahoo.com Monday January 13, 6:00 AM By Grainne McCarthy Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--Having fallen swiftly on the back of some surprisingly weak U.S. employment data, the dollar is set to remain under pressure this week, increasingly vulnerable to the drumbeat of war surrounding Iraq and nuclear saber-rattling in North Korea.

"People are positioned for Armageddon on the dollar, in that scenario you can get whacky moves," says Paul Podolsky, chief strategist at Fleet Global Markets in Boston.

Investors unsure of the dollar's vulnerability to U.S. economic data got a resounding wake-up call Friday, with the currency tumbling swiftly after the government reported a dismal December payrolls report that fueled concerns about the lingering soft spot dogging the world's largest economy. The dollar hit a fresh three-year trough against the euro, while sliding to its weakest point against the Swiss franc in four years.

Late Friday in New York, the euro was at $1.0574, up steeply from $1.0488 late Thursday. Against the Swiss franc, the dollar was at CHF1.3802, sharply down from CHF1.3909 late, while sterling was at $1.6082, modestly up from $1.6061 late Thursday. The dollar was at Y119.20, modestly lower than Y119.26 late Thursday in New York.

Even as Canada reported another remarkably strong month of employment growth, job losses in the U.S. soared to 101,000, disarmingly far from consensus forecasts for a modest increase of 20,000.

There were clearly some seasonal explanations for the massive leap but the report still further underscored a view that the sluggish U.S. economic recovery isn't creating jobs, potentially boding ill for the dollar at a time when it's already being undermined by war concerns.

"Until Iraq goes away and the outlook for consumer confidence and business spending improves, the dollar is going to remain under pressure," said Jay Bryson, global economist at Wachovia Securities in Charlotte, N.C.

There will certainly be plenty of economic data this week for dollar investors to sink their teeth into, with the focus most likely on somewhat stronger economic activity and benign inflation. Headline retail sales for December - to be reported Tuesday - are expected to come in very firm, mostly thanks to the 18% jump in auto sales already reported. But excluding autos, economists anticipate just a 0.3% increase.

The U.S. will also see December's producer price and consumer price indexes on Wednesday and Thursday respectively, while the focus for Friday will be squarely on the initial University of Michigan consumer sentiment report for January, which should provide a glimpse of how confidence is holding up amid growing war jitters.

But aside from the clear significance of much of this data, many analysts expect the dollar to look more to the Pentagon, State Department and ultimately the White House for signposts for near-term direction.

As the central emblem in financial markets of the world's only superpower, the dollar is beset by multiple threats to global stability that are simultaneously breaking out on several fronts. As well as the situations in North Korea and Iraq, the ongoing battle against terrorist network al-Qaida is high on the list of nightmarish issues facing the Bush administration. The U.S. - given its position of global hegemon - has almost by default become the first line of defense in tackling these challenges.

"Connect the dots and what emerges is hardly encouraging for the dollar in particular and the financial markets in general," said Joseph Quinlan, global economist at Johns Hopkins University in Washington.

He argues that investors in U.S. assets, while certainly cognizant of war risk, may have priced in an overly rosy scenario under which the war on terrorism has already been won, the war against Iraq has already been priced in and a war on the Korean peninsula is too remote a possibility to take seriously.

An upset to this more optimistic picture could weigh much more heavily on global capital flows, ultimately depressing the dollar given the U.S. status as a creditor nation dependent on capital inflows to finance the current account.

Indeed, some analysts believe the dollar's swift reaction to the jobs data raises the question of whether the currency might be headed for a more precipitous slide, which has the potential to ripple more heavily over into other U.S. asset markets, while also raising alarm among policy makers.

"We've had a pretty quick move here and a lot of people are scratching their heads and asking if the speed of adjustments might be more than they've already anticipated," said Marcel Kasumovich, head of G-10 currency strategy at Merrill Lynch in New York. "Especially if you start to see a feedback to interest rates or equity markets, that sends a warning signal to central banks that maybe there's a confidence issue."

For now, that's not happening, but the tenacity of the euro's gains could have clear consequences for U.S. fixed income markets. A stronger euro only enhances the appeal of European sovereign debt, which many global fund managers have been advocating for months as much more appealing than Treasurys, particularly with expectations that the European Central Bank still has some room to lower interest rates.

Already currency analysts are talking about the euro reaching as high as $1.10 this month, a dramatic contrast from just a couple of weeks ago when a survey of major currency dealing banks predicted the euro only scaling those heights at the end of this year.

Elsewhere, the focus this week will once again be on Venezuela, after the bolivar tumbled last week amid some panic buying ahead of a 48-hour bank strike. The currency did rebound on Friday, but remains vulnerable to further instability, with the general strike, which began Dec. 2, lingering.

-By Grainne McCarthy; Dow Jones Newswires; 201 938 2381; grainne.mccarthy@dowjones.com

abcnews.go.com — By Hassan Hafidh and Dominic Evans

BAGHDAD/LONDON (Reuters) - Saudi Arabia put out peace feelers over Iraq on Sunday as a British minister signaled fresh unease within Prime Minister Tony Blair's cabinet over joining a possible U.S.-led war against Baghdad.

The United States said it was more than doubling its troop strength in the Gulf region to 150,000 amid signs in Europe and the Middle East that many states were increasingly nervous about a possible rush to war and wanted all other options explored.

Saudi Arabia, a key U.S. ally and the Gulf region's economic powerhouse, said it did not believe there would be a war and disclosed it had proposed an initiative to fellow Arab states to resolve the crisis.

"There is no doubt that all the reasons point to a war but I personally believe there will not be a war... I see the fleets but, God willing, there will be no war," the kingdom's de facto leader, Crown Prince Abdullah, said in remarks carried by state television.

"Saudi Arabia has presented proposals to its brothers in Arab states and asked them to accept them and for them to be the basis of any summit. I believe if the (proposal) is accepted, then it will solve many problems," he said.

Britain's International Development Secretary Clare Short said on Sunday Britain should not join a unilateral U.S. attack on Iraq and said it was Britain's duty to restrain Washington.

Her comments took on added significance when sources said Blair would meet President Bush after a January 27 report by U.N. inspectors on Iraqi compliance with searches for arms of mass destruction.

POSSIBLE COUNCIL OF WAR

Blair has said the inspectors should be given time to deal with Iraq but British newspapers reported at the weekend that the meeting could turn into a council of war if Baghdad failed to satisfy U.N. teams on questions about its arms programs.

"I think all the people of Britain have a duty to keep our country firmly on the U.N. route, so that we stop the U.S. maybe going to war too early, and keep the world united," Short, one of the most dovish members of Blair's cabinet, told Britain's ITV network.

Blair and Bush are the chief prosecutors in the case against Iraq, saying they have intelligence that Baghdad possesses banned weapons and threatening war unless it comes clean.

Short's remarks underlined increasing disquiet within the ranks of Blair's Labor Party over going to war against Iraq without U.N. authorization or hard evidence against Baghdad.

For many countries, particularly in the Muslim world, the jury is out until clear proof is produced that Baghdad has biological, chemical or nuclear weapons.

Egyptian President Hosni Mubarak urged Iraqi President Saddam Hussein on Sunday to cooperate with U.N. inspectors to avert a devastating war.

"(Saddam) said, 'The weapons inspectors don't talk to us properly'. Put up with it to avoid the annihilation of the people," Mubarak counselled the Iraqi leader in remarks to reporters.

SADDAM URGES NEIGHBORS TO STOP WAR

Saddam himself said only Iraq's neighbors could stop the United States from declaring war on Baghdad.

"Inspection teams are here and our cooperation with them is continuing, but if America wants to look for a pretext for the aggression, only the countries of the region can prevent it," Saddam was quoted by Iraqi state television as saying during a meeting with Turkish Trade Minister Kursad Tuzmen.

Tuzmen carried a letter from Turkish Prime Minister Abdullah Gul urging Iraq to comply with U.N. resolutions in an effort to ward off military action.

European officials have spoken out against a rush to war on the basis of inconclusive weapons inspections, which resumed in late November after a four-year hiatus.

France, a veto-wielding member of the U.N. Security Council, has insisted on an international mandate for any military action, while Germany opposes an attack on Iraq.

U.N. inspectors say they have not found any evidence of active weapons programs in Iraq, but that Baghdad's arms declaration fails to answer a "great many questions."

Iraqi Vice President Taha Yassin Ramadan, in the government newspaper al-Jumhouriya, repeated accusations by Saddam last week that the inspectors were carrying out "intelligence" work, but said Baghdad would continue to cooperate with them.

"We know they are playing an intelligence role. The way they are conducting their inspections and the sites they are visiting have nothing to do with weapons of mass destruction," he said.

Amer al-Saadi, an adviser to Saddam, said two Iraqi scientists interviewed by U.N. inspectors last month had refused to leave the country for further interviews.

Against the backdrop of possible war in Iraq, the Organization of Petroleum Exporting Countries agreed in Vienna on Sunday to raise production to stave off a rise in oil prices threatened by a strike in Venezuela.

abcnews.go.com — By Carol Giacomo and Hassan Hafidh

WASHINGTON/BAGHDAD (Reuters) - The United States ordered 62,000 more troops to the Gulf at the weekend, despite signs of European reluctance to rush to war with Iraq.

As the military build-up went ahead, Iraqi President Saddam Hussein said Sunday that only Iraq's neighbors could prevent the United States from declaring war on Baghdad.

Sources said British Prime Minister Tony Blair would meet President Bush soon after U.N. arms inspectors present a key report on Jan. 27 on Iraq's compliance with their searches for weapons of mass destruction.

The inspectors visited at least eight sites in Iraq on Sunday, hunting for banned nuclear, chemical and biological weapons, an Iraqi official said, as Baghdad again accused them of spying.

"Inspection teams are here and our cooperation with them is continuing, but if America wants to look for a pretext for the aggression, only the countries of the region can prevent it," Saddam was quoted by Iraqi state television as saying during a meeting with Turkish Trade Minister Kursad Tuzmen.

Tuzmen was carrying a letter from Turkish Prime Minister Abdullah Gul urging Iraq to comply with U.N. resolutions in an effort to ward off military action.

"With clarity, seriousness and brotherly dialogue we can reach the best solutions in the field of bilateral cooperation which would lead to many achievements and a high degree of stability in the region," Saddam said.

BLAIR TRIP TO WASHINGTON

Blair, Bush's staunchest ally on Iraq, is expected to use his trip to Washington to press his position that U.N. inspectors be given time to do their work.

His spokesman said Blair had told his cabinet: "January 27, whilst an important staging post, should not be regarded in any sense as a deadline."

The Washington Post, however, quoted a senior U.S. official as saying while the United States believed the January 27 report would probably not provide a definitive trigger for war, "it is a very important day (marking) the beginning of a final phase."

Besides ordering the deployment of 62,000 additional military forces since Friday, the Pentagon launched an e-mail campaign urging Iraqi civilian and military leaders to reject Saddam.

Defense officials said the United States could be ready for war by mid- to late-February with a force exceeding 150,000 soldiers, sailors, Marines and airmen.

But European officials have spoken out against a rush to war on the basis of inconclusive weapons inspections, which resumed in late November after a four-year hiatus.

France, a veto-wielding member of the U.N. Security Council, has insisted on an international mandate for any military action, while Germany opposes an attack on Iraq.

Three out of four French people were opposed to France taking part in any Iraq war, a survey in the weekly Le Journal du Dimanche showed. In Britain, many in Blair's own Labor Party opposed war, surveys have shown.

NO SMOKING GUN

Washington accuses Baghdad of developing weapons of mass destruction and has threatened war unless Iraq complies with a tough new U.N disarmament resolution. Iraq denies it possesses such weapons.

U.N. inspectors have said they have not found concrete evidence of active weapons programs, "no smoking gun," but that Iraq's weapons declaration fails to answer many questions.

Iraqi Vice President Taha Yassin Ramadan, in the government newspaper al-Jumhouriya, repeated accusations by Saddam last week that the inspectors were carrying out "intelligence" work, but said Baghdad would continue to cooperate with them.

"We know they are playing an intelligence role. The way they are conducting their inspections and the sites they are visiting have nothing to do with weapons of mass destruction," he said.

Saddam's adviser Amer al-Saadi said: "They (inspectors) are asking questions which are irrelevant to weapons of mass destruction and to their mandate. For example, they visited an air base and asked about the routes leading to and out of it."

Saadi also said two Iraqi scientists interviewed by U.N. inspectors last month had refused to leave the country for further interviews on Iraq's weapons programs. The United States has pressed inspectors to take scientists abroad in the hope they would feel more able to disclose crucial intelligence.

Saadi said he expected the interviews to be "a topic for further discussion" with chief U.N. inspector Hans Blix and International Atomic Energy Agency head Mohamed ElBaradei when they visit Iraq on Jan. 19.

Arab League Secretary-General Amr Moussa warned any attack on Iraq would open a "Pandora's Box" of problems in the Middle East, "a region already frustrated by Israeli policies against Palestinians," United Arab Emirates newspapers reported.

Against the backdrop of possible war in Iraq, the Organization of Petroleum Exporting Countries (OPEC) agreed in Vienna Sunday to raise production to stave off a rise in oil prices threatened by a strike in Venezuela.