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Wednesday, February 28, 2007

World economy: Exposing the risks


If financial markets doubted China’s rising economic influence, they don’t any longer. A plunge in China’s stockmarket on February 27th triggered a chain reaction, punishing equities in most countries, unnerving currency markets and curbing investor appetite for risky assets. The surge in worldwide volatility brought together on one day nearly every major risk threatening the global economy: speculative investment in China, the yen carry trade, overvalued emerging markets, and fears of a sharp decline in the US dollar.

Nothing fundamental has changed in the global economy in the last day, and the equity sell-off will probably be short-lived. (China’s stockmarket opened lower on Wednesday.) But the sweeping reaction to events in China—and to other big risks, such as a slump in the US economy—says much about the precarious state of financial markets, and suggests volatility will increase. One closely watched indicator of US stock market volatility, the Chicago Board of Trade’s VIX index, soared by more than 60% on Tuesday.

China’s Shanghai and Shenzen 300 Index fell 9.2% yesterday, the most in 10 years, after the government a day earlier said it approved a task force to clamp down on illegal share offerings and rampant stockmarket speculation. The Shanghai and Shenzen index has risen by 135% in the last 12 months and Chinese officials openly worry about an equity bubble. A few years ago, a sharp fall in China’s murky stockmarket would have meant little internationally; today, with China increasingly driving global growth, any disturbance in the world’s third-largest economy has the potential to create contagion in both rich countries and emerging markets. Other factors, though, also contributed to Tuesday’s global panic: January US durable goods orders, a measure of business investment, fell by the most in three years.

Just a sell-off?

Yesterday’s global stockmarket retreat was probably just that; a much-needed sell-off after a period of strong gains. The US Dow Jones Industrials fell 3.3% and the European DJ Stoxx 50 dropped 2.6%. The carnage was worse in emerging markets: Brazil’s stock exchange fell by more than 6% and Mexico’s by almost that amount. Equities also declined in Russia, Turkey and most other emerging markets. But this has happened before—notably in April/May 2006, and the markets soon recovered. Nothing in China’s stockmarket rout, in particular, suggests deeper weakness in the economy. Global investors were looking for an opportunity to take profits, and an equity slump in China was a suitable excuse. The sell-off was also a boon for bonds in the US and Europe, as nervous investors sought a safe haven. The price on the benchmark US Treasury note rose by two-thirds of a percentage point and the yield fell by 9 basis points.

That said, Tuesday’s turmoil exposes deeper fissures in a global economy that has been kept afloat for years by cheap money. US equity markets had been rising more or less steadily for the last eight months, despite slowing economic growth and a declining housing market. Markets have been even more buoyant in Europe. Investors in emerging markets have thrown caution to the wind: risky markets in such far-flung places as Russia, Argentina and Egypt have attracted so much capital that government bond spreads over US Treasuries have plummeted. This heedless approach to risk has been epitomised by the so-called carry trade, in which investors borrow in low-yielding currencies such as the yen and the Swiss franc and invest in securities that bring a higher return, typically in emerging markets.

Carry trade

On Tuesday, the carry trade showed signs of unwinding, at least temporarily. The yen was the world’s best-performing currency, rising by more than 2% against the US dollar as investors sold emerging-market currencies and bought Japan’s to close out speculative positions. The Swiss franc also rose against the dollar, by more than 1%. Most of the popular carry-trade investment currencies, including those in New Zealand, Iceland and South Africa, fell by between 1% and 2.5%.

Economists have been expecting the carry trade to unravel for more than a year, to no avail, and nothing that happened yesterday suggests a sustained reversal. Interest rates remain very low in Japan and Switzerland, and the opportunity to earn profits by borrowing those currencies and investing elsewhere remains attractive. But the carry trade also depends on stable exchange rates; if Tuesday’s gyrations signal a period of greater volatility, the appeal of the carry trade will fade. It is too soon to draw that conclusion; the trade has slowed before, only to accelerate when volatility eased. The Bank of Japan’s decision last week to raise the country’s benchmark interest rate should have depressed the carry trade, but the central bank’s signal that rates won’t rise very sharply during the next year had the effect of reassuring carry trade investors.

The sell-off in emerging markets also highlights the frothy valuations in many of these countries; equity markets in India and Russia, for example, have doubled or tripled in the last two years. Although emerging-market bourses declined by around 25% in April and May 2006, they later rebounded and pushed even higher by year’s end. Morgan Stanley Capital International’s emerging markets index, a composite of 23 stockmarkets, has doubled in the last three years (it fell 3% on Tuesday.) Another measure of investor risk, the composite spread between emerging-market government debt and US Treasuries, has fallen to a record-low of around 165 basis points this year from a 10-year average of around 600 basis points. (The spread on Tuesday was as much as 12 basis points higher than the day before.) The search for yield in emerging markets has, despite ever higher valuations, been relentless.

Chinese froth

The tumult in China’s own market also points to the speculative nature of investment there. Some sectors in China, especially property and construction, have experienced significant overinvestment; surplus capacity in China’s steel industry, for example, exceeds Japan’s entire output of steel. China’s stock market, in particular, has been a casino for the last year. While China’s economy continues to grow rapidly, the government is adopting policies to restrain investment, and there is no clear evidence of overheating. That said, the government’s struggle to manage the stockmarket surge suggests that its wider management of the economy may not always go smoothly.

The global equity sell-off, which was partly fueled by weak US economic data, also suggests the US dollar may be in for a rough ride. The dollar fell sharply at the end of 2006 as the economy slowed, but recent buoyancy in US growth and a likely delay in interest-rate cuts by the Federal Reserve have served to support the dollar this year. The US economy, despite weakness in manufacturing and housing, continues to expand, and the Economist Intelligence Unit still expects growth of around 2.5% in 2007. But the dollar remains vulnerable to even the slightest hint of bad economic news, and with the European and Japanese economies performing well, investors have alternatives to the US.

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Selected CRS Reports

Analysts at the Congressional Research Service continue to churn out reports for Congress faster than they can reasonably be digested. Not all of them are of broad interest, nor do they consistently offer original content or significant analytical insight.

But as long as Congress refuses to make them available online to the general public, there seems to be value in our helping to do so.

Recent CRS products that are not already available in other online public collections such as OpenCRS and the State Department's Foreign Press Center include the following.

"Is China a Threat to the U.S. Economy?," updated January 23, 2007.

"China's Trade with the United States and the World," updated January 4, 2007.

"Yemen: Current Conditions and U.S. Relations," updated January 4, 2007.

"State and Urban Area Homeland Security Plans and Exercises: Issues for the 110th Congress," updated January 3, 2007.

"The Organization for Economic Cooperation and Development," updated January 19, 2007.

"Environmental Activities of the U.S. Coast Guard," updated January 16, 2007.

"The Emergency Planning and Community Right-to-Know Act (EPCRA): A Summary," updated January 3, 2007.

"Countries of the World and International Organizations: Sources of Information," updated January 8, 2007.

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Venezuela to purchase surface-to-air missiles

Russian media has reported that Hugo Chavez has expressed interest in purchasing Russian made Almaz-Antey Tor-M1 SA-15 surface to air missiles. Russia will provide training and maintenance for $300 million.

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Canada's Parliament scraps 2 anti-terror measures

Two anti-terror measures adopted as part of Canada's response to the Sept. 11 terror attacks will expire Thursday after opposition lawmakers agreed they were an unnecessary infringement on civil liberties.

The measures empower authorities to arrest and detain suspects for three days without charge and to compel individuals with knowledge of terrorist activity to testify before a judge. Neither has ever been applied.

Prime Minister Stephen Harper of the Conservative Party wanted to extend them three years, but his minority government needed the opposition's support.

The motion was defeated 159-124 in the House of Commons Tuesday after all three opposition parties voted against it.

"These two provisions especially have done nothing to fight against terrorism, have not been helpful and have continued to create some risk for civil liberties," Liberal leader Stephane Dion said.

The vote came just days after Canada's Supreme Court struck down a law allowing the government to detain foreign terror suspects indefinitely while the courts review their deportation orders.

Human rights activists hailed Friday's ruling as a victory for those who believe fundamental rights have been curtailed in the name of national security after Sept. 11.

That law and the two measures expiring Thursday were all part of a sweeping package of antiterrorism laws passed weeks after the 2001 attacks on New York and Washington.

Although some abstained, most Liberal Party lawmakers voted Tuesday against extending the measures, although the opposition party was in power when the laws were passed.

Harper predicted the Liberals will be defeated in the next election because of their refusal to back his proposed extension.

"This issue is not going to go away. It's going to haunt the Liberal Party from now until the election campaign," Harper said. That campaign could begin as early as this spring.

"Any party that doesn't take the national security of Canadians seriously will never be chosen by Canadians to form the government of Canada."

Ahead of the vote, relatives of Canadians killed in the Sept. 11 attacks appealed to lawmakers to retain the security measures.

Maureen Basnicki, whose husband, Ken, was one of 24 Canadians killed in the attack on the World Trade Center, said a rejection would seriously diminish Canada's capacity to fight terrorism.

"We want to protect other Canadians from the devastation that we experienced," Basnicki said.

Stockwell Day, Canada's public safety minister, said Canada was sending the wrong message to allies and potential terrorists.

Although the provisions were never used, the Royal Canadian Mounted Police was planning to use the investigative hearing provision to compel 15 individuals to testify about their knowledge of Canada's worst terrorist attack - the 1985 downing of Air India Flight 182, which claimed 329 lives.


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US won't extradite indicted CIA agents to Italy

The United States will refuse any Italian extradition request for CIA agents indicted in the alleged abduction of an Egyptian cleric in Milan, a senior US official said Wednesday.

"We've not got an extradition request from Italy. If we got an extradition request from Italy, we would not extradite US officials to Italy," John Bellinger, legal adviser to US Secretary of State Condoleezza Rice, told journalists after meeting legal advisers to EU governments.

Milan prosecutors want the Italian government to forward to Washington their request for the extradition of the 26 Americans, mostly CIA agents. The previous government of Silvio Berlusconi refused, and Premier Romano Prodi's center-left government has indicated it would not press Washington on the issue.

The 26 are accused in the abduction of Osama Moustafa Hassan Nasr from a Milan street on Feb. 17, 2003. Nasr was allegedly taken to Aviano Air Base near Venice, Ramstein Air Base in southern Germany, and then to Egypt, where he was held for four years and, according to his lawyer, tortured. He was freed last week by an Egyptian court that ruled his detention was "unfounded."


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Pakistan: Teacher suspected to be US spy beheaded

Suspected Islamic militants captured and beheaded a schoolteacher in Pakistan's wild Afghan border area for allegedly spying for the United States, an official said Wednesday.

The man's body was found early Tuesday in a large sack dumped by a road near Jandola, a town in the South Waziristan tribal district, the local security official said. He asked not to be identified due to the sensitive nature of his job.

A note found with the beheaded man's body identified him as "Akhtar Usman, the one who spied for America," the official said.

He said the forehead of the man's severed head was inscribed with the word for "hypocrite" in Urdu, Pakistan's main language.

Usman, in his 30s, was a teacher at an Islamic school in nearby North Waziristan and was known to have spoken out against militants in the area, the official said.


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Senior U.S. Officials Urge Changes to Create, Retain ‘Cyber Warriors’


The Pentagon must create a new force of experts to combat growing threats in cyberspace, a task that will require changes in how the military’s high-technology experts are trained, educated and retained, senior U.S. military officials say.

But, according to several officials, the military is still grappling with several key questions about just how officials should create such a cyber fighting force, including:
• What skills will cyberwarriors need?
• What training and education will they need?
• How will the services retain them? Often, these personnel opt to jump to the private sector – where salaries are bountiful.

“It takes five years to build someone who can do this,” Marine Corps Brig. Gen. Jon Davis, the deputy commander of Strategic Command’s Joint Functional Component Command for Network Warfare, said last week during an industry conference in Alexandria, Va. Then, Davis said, “The services have to figure out how to keep guys in the ‘cyber cockpit.’”

The 2006 Quadrennial Defense Review highlighted the growing strategic importance of cyberspace, noting it plays an increasingly important role in U.S. operations. The Air Force last fall unveiled plans to establish its first Cyberspace Command. Some military officials are debating how the military should be organized and armed — from a legal and hardware standpoint — for cyber conflict.

Military officials and information security experts say the new cadre is needed to meet the growing potential threats of al-Qaida and rising national powers like China.

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Hezbollah building new military line

BEIRUT, Lebanon (UPI) - The armed wing of the Lebanese Hezbollah organization is openly rebuilding a military line further back from the Israeli border along with an arsenal.

A Times of London correspondent reported the build-up is occurring out of sight of the 12,000-strong U.N. Interim Force In Lebanon, or UNIFIL, although peacekeepers said they are aware of what's going on.

Hezbollah critic Walid Jumblatt told the newspaper Shiites are buying land to create a contiguous belt through the mountains north of the Litani river.

"The state of Hezbollah is already in existence in south Lebanon," Jumblatt said.

For 34 days last July and August, Hezbollah militia and Israeli troops fought along the border, killing more than 1,100 Lebanese civilians, 116 Israeli soldiers and 43 Israeli civilians.

A Western diplomat who asked not to be identified said while Hezbollah has admitted to rearming, the strategic land acquisitions suggest more is going on.

"We have evidence to support their presence there. It seems to be an expansion of what was there before the war," the diplomat said.

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Baloch Nationalists Up the Ante in Iran

By Chris Zambelis

A February 14 car bomb attack against a bus carrying Iranian Islamic Revolutionary Guard Corps (IRGC) units outside of Zahedan in Iran's southeastern province of Sistan-Balochistan is the latest example of tensions and violence between ethnic Baloch nationalists and Tehran. Eleven IRGC members were killed and scores more wounded in the bombing. Baloch insurgents also allegedly targeted a school located near the site of the initial strike on February 16, culminating in a firefight between rebels and Iranian security forces (Fars News Agency, February 15; Rooz, February 21).

Iranian authorities accused Jundallah (Soldiers of God) of orchestrating the attacks. Jundallah has a history of violence against Tehran dating back to 2003, including attacks against Iranian security forces and other symbols of the regime. Unlike most ethnic Persians and other Iranians who are Shiite Muslims, the vast majority of ethnic Baloch are Sunnis. Sistan-Balochistan is one of Iran's most underserved and impoverished regions (Terrorism Monitor, June 29, 2006). The province is also the scene of frequent military crackdowns by Iranian security forces. As a result, Iranian Baloch harbor deep resentment toward Tehran and feel a sense of solidarity with their kin in Pakistan's neighboring province of Balochistan, who are also engaged in a violent struggle for independence, and the small Baloch community in Afghanistan in what Baloch nationalists refer to collectively as "Greater Balochistan." Because of their Sunni background, Tehran accuses Baloch nationalists, in an attempt to tarnish the group's image, of having ties to al-Qaeda and the Taliban, despite a lack of evidence (Terrorism Monitor, June 29, 2006).

Shortly after the attacks, Tehran announced that it had detained men allegedly involved in the bombing who later provided televised confessions of having received foreign funding and material support to sow ethnic and sectarian strife to destabilize Iran. Iran then accused the United States and other foreign elements of backing Jundallah, possibly from Pakistani territory with Islamabad's support, despite Pakistan's history of cooperating with Iran to suppress Baloch nationalism. Tehran then publicized photographs of what appear to be U.S.-made ammunition and explosive materials allegedly uncovered at a Jundallah hideout (Fars News Agency, February 18). Interestingly, the United States is known to have provided the Northern Alliance units with the same material during the invasion of Afghanistan. A number of sources, however, claim that the images were doctored using Photoshop software (http://www.iraqslogger.com).

Iran also accused Abdulmalak Rigi, the group's leader, of appearing on a television station run by the People's Mujahideen of Iran (PMOI) minutes before the February 16 attacks, thus implying a link between Jundallah and other Iranian opposition groups. In a February 17 statement on its official website, PMOI dismissed these claims as "propaganda" devised by Iranian intelligence to tarnish the reputation of PMOI. The PMOI, also known as the Mojahedin-e-Khalq (MEK), is affiliated with the opposition National Council of Resistance of Iran (NCRI), an umbrella organization of anti-regime movements that include ethnic Baloch and other Iranian minority-led groups that seek to overthrow the Shiite Islamist-led government (http://www.ncr-iran.org).

Jundallah traditionally claims responsibility for its attacks early. The group eventually took credit for its actions under a different moniker. In a public statement issued on February 20 by the self-proclaimed "former Jundallah of Iran" and "People's Resistance Movement of Iran" (PRMI), the group justified what it labeled as "recent defensive measures" to prevent Iran's "genocide" against the Baloch people. PRMI also declared its intention "to change the present regime and establish a new system in Iran in which every Iranian enjoys equal opportunity and equal rights." The group adamantly denies any links to al-Qaeda and the Taliban, as well as foreign governments such as the United States and Great Britain: "We do not receive any support, arms, ammunition, training and financial help from any country. In such conditions it is not easy for us to live peacefully. Yet, we have been able to maintain our independence in such [an] important geopolitical center and battlefield" (http://www.radiobalochi.org).

Tehran's claims of a foreign hand behind Baloch nationalism mirror previous allegations of U.S. and British support for armed uprisings among ethnic Arabs (Ahvazi) in Iran's southwestern province of Khuzestan (also known as Arabistan) and ethnic Kurdish nationalists in Iranian Kurdistan. Tehran is also attempting to counter pressure from Washington over its nuclear program and influence among Iraqi Shiite militias by casting the United States as a destabilizing force in the region. In this context, groups such as PRMI see growing U.S. pressure on Iran as an opportunity to bolster their own positions.

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French Authorities Dismantle Network of Fighters Bound for Iraq

By Pascale Combelles Siegel

In the early hours of February 14, the anti-terrorism directorate of the French national police arrested 11 French citizens, including four women, on suspicion that they were part of a network recruiting volunteers to go to Iraq to fight the U.S.-led coalition. On February 17, the French prosecutor charged six men with "criminal conspiracy in connection with a terrorist venture" (e.g. facilitating the infiltration of jihadis into Iraq via Syria). Three of them have also been placed under formal investigation for financing international terrorism. Four have been remanded in custody, while two have been released with judicial supervision. The four women were released on February 15 and the last man was released on February 16. The names of those involved, however, have not been released.

French authorities have known since the summer of 2004 that some young Muslims living in France were seeking to infiltrate Iraq to fight against coalition forces. Between July and October 2004, three young Muslim French citizens were killed in the Sunni Triangle area of Iraq. By December 2004, the French anti-terrorism services identified "Fawzi D.," a French Muslim, as an amir of an Iraqi armed group (estimated at 20 people) fighting against the U.S. Marines in Fallujah. These deaths prompted the French prosecutor's office to open an investigation into the networks providing assistance to jihadis infiltrating Iraq. The investigation led to the dismantlement of at least three networks in Paris, Tours and Montpellier in the past two years (NouvelObs.com, January 26, 2005). According to press reports, the recruitment networks of would-be jihadis bound for Iraq used the Mosque of Adda'Wa in the 19th arrondissement of Paris and a musalla (prayer hall) in Levallois (a working suburb of Paris). The Levallois prayer hall was closed in 2004 while the Mosque of Adda'Wa was raided by police in December of 2005.

This latest operation was the result of a different, joint Franco-Belgian surveillance operation that began in May 2006. Both French and Belgian authorities have praised the cooperation effort as "excellent" (20minutes.fr, February 17). According to the Paris prosecutor's office, "This [operation] is the result of an exemplary cooperation between the French and Belgian services, which took the novel approach of mutual assistance, with the creation of a joint investigative unit." The joint surveillance operation led to 11 arrests in France and nine more in Belgium on suspicion of ties to a terrorist group. Six of the 11 were charged in France, while the nine Belgians were released after being interrogated.

These operations provide insight into the path of young French Muslims who leave their lives behind to face certain death in Iraq. The would-be jihadis trying to infiltrate Iraq are French Muslim citizens. They are the sons of Muslim immigrants born in France. They closely identify with the idea, repeated ad nauseum by jihadi propaganda, that the Muslim nation is suffering great injustices at the hands of the West in general and of the United States in particular. They do not necessarily come from destitute socio-economic backgrounds; two of those arrested in Montpellier, for example, were students in telecommunications and electronic engineering.

In these latest arrests, according to the police, the radicalization process began in Egypt. The recruits traveled to radical schools in Egypt, where they learned Arabic and underwent ideological and religious training (in Salafism). After successfully completing this training, the recruits made contact with a cell affiliated with al-Qaeda in Saudi Arabia. This cell helped them reach a network in Syria that was supposed to infiltrate them into Iraq (20minutes.fr, February 17). Their ultimate goal, according to the French prosecutor's office, was to "commit terrorist acts such as suicide bombings" (20minutes.fr, February 17). There was nothing in the background of those arrested on February 14 hinting at their jihadi inclinations. The police did not have records on any of them, neither for criminal activity nor for association with radical Islamists or with terrorist groups. They also were not known for supporting "jihad" elsewhere (20minutes.fr, February 17). The run of this particular cell ended in Syria, when authorities intercepted two of them last December. Both men arrested in December were deported back to Paris on the February 14. The rest of the network was arrested in France on the same day.

Considering that terrorist networks and radical Islamists have used the wars in Afghanistan and Bosnia very effectively to radicalize young Muslims in the past, the French authorities greatly fear the possible effects of a blowback from the Iraq war on the French Muslim population. The networks uncovered so far do not seem to be as numerous and as sophisticated as those operating during the Afghan war, but the question remains as to how long this will remain the case.

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Two militants killed in sweep in Dagestan

MAKHACHKALA. Feb 28 (Interfax) - Two militants have been killed in the active phase of a sweep operation, which has ended in the village of Tyube in Dagestan's Kumtorkala district, a source in Dagestan's Interior Ministry, who worked at the scene, told Interfax.

"The Dagestani Interior Ministry was informed on Tuesday evening that a suspicious group had been noticed in a private house in the village of Tyube. The house was encircled at about 5:30 a.m. and the group was ordered to walk out and surrender. Two men, one of them the owner of the house, followed the order. They are being questioned," the source said.

But the two other men stayed in the house refusing to surrender. The house was stormed at 5:45 a.m. with the use of armored vehicles and grenade launchers. The operation lasted for two hours.

"Early reports indicate that both suspected militants were killed. They have been identified, but their names will not be disclosed thus far. Investigators are working at the scene," the source said. sd

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Two Iranian police killed, four abducted in ambush attack near Pakistan border


A group of Iranian police were ambushed late Tuesday in Sistan-Baluchestan province bordering Pakistan, leaving two police killed and four others kidnapped, the official IRNA news agency reported on Wednesday.

Police commander Esmael Ahmadi-Mogadam was quoted as saying that "seven police fell victim to an ambush by rebels, two were killed and another four were abducted", without disclosing the seventh police's destiny.

"The rebels in two cars escaped towards Pakistan," said Ahmadi- Mogadam.

The commander complained that "the Pakistani side lacks cooperation with Iran to fight against these rebels", underscoring that "this position is not acceptable."

Sistan-Baluchestan province borders with Pakistan and Afghanistan. Earlier this month, 13 Revolutionary Guards members were killed in a car bomb explosion in the provincial capital Zahedan.

Iran's security forces usually clash with local armed groups which were involved in drugs smuggling. Sistan-Baluchestan and its close province of Kerman have been hit by a string of attacks and kidnappings in the past years, which Iranian authorities blamed on a Sunni group called Jundallah.

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Security developments in Iraq, Feb 28

Feb 28 (Reuters) - Following are security developments in Iraq as of 0830 GMT on Wednesday:

BAGHDAD - A car bomb killed 10 people and wounded 21 near a vegetable market in Bayaa district in southern Baghdad, police said.

NEAR TAJI - U.S. forces killed eight insurgents and detained six suspects during operations targeting foreign fighter facilitators and the al-Qaeda in Iraq network northeast of Taji, 20 km (9 miles) north of Baghdad, the U.S. military said.

TIKRIT - Gunmen shot dead a man inside his car on Tuesday in Tikrit, 175 km (110 miles) north of Baghdad, police said.

HIMREEN - Police found a body shot in the head in the town of Himreen, 120 km (75 miles) south of the northern oil city of Kirkuk, police said.

MOSUL - Gunmen killed Abdul-Hadi Mahmoud, the head of a government office in Mosul that issues identity cards, in a drive-by shooting in the northern city of Mosul, 390 km (240 miles) north of Baghdad, police said.

ISKANDARIYA - Several mortar rounds landed in a residential district, killing a man and woman, in the town of Iskandariya, 40 km (25 miles) south of Baghdad, police said.

BAGHDAD - A report of a bomb killing 18 people, mostly children, on Tuesday in Ramadi was wrong and stemmed from confusion over a similar attack the day before, police officials and residents said. There was no such attack on Tuesday.

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Sudan: Iranian President arrives for visit

Khartoum, 28 Feb. (AKI) - Iranian president Mahmoud Ahmadinejad arrived in Sudan on Wednesday for a two-day visit to the country, which like Iran is currently under pressure from the United Nations. Ahmadinejad wad greeted at Khartoum airport by Sudanes president Omar el-Bashir. Sudan continues to face international criticism for policies in the country's ethnically troubled Darfur region where government forces have been accused of colluding with local Arab militias in the murder and rape of the region's African ethnic groups. Khartoum has repeatedly refused to allow UN peacekeepers to deploy in Darfur.

On Tuesday the International Criminal Court of Justice in The Hague, Netherlands released what it said was evidence implicating former Sudanese interior minister Ahmed Haroun, the current humanitarian affairs minister, in the killings of civilians in Darfur. Khartoum has rejected ICC jurisdiction to try those it intends to indict for crimes in Darfur.

Iran on the other hand ins under fire for its controversial nuclear development programme with the United States and several European nations pressing the UN to impose sanctions on Tehran.

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Russia Worried About Possible U.S. Military Attack on Iran

Russian Foreign Minister Sergei Lavrov has said that Moscow was “worried” about the possibility of US military action against Iran, The Associated Press reported on Monday.

“We are worried that the forecasts and suppositions of a possible attack on Iran have become more frequent,” Lavrov said during a meeting with President Vladimir Putin that was shown on state television.

Lavrov referred in particular to comments made last week by US Vice President Dick Cheney, who said that “all options are still on the table” for Washington to prevent Iran from acquiring nuclear weapons.

“What attacks are they talking about, without sanctions from the UN Security Council?” Putin asked during the meeting at his Novo-Ogaryovo residence outside Moscow.

“No-one is talking about such sanctions,” Lavrov responded.

Russia has relatively close ties with Iran and is building the country’s first nuclear power station at Bushehr, although Moscow agreed to support limited UN sanctions in December against the Islamic republic.

Washington suspects Iran of developing nuclear weapons under cover of a nuclear energy programme. Iran denies this, saying its nuclear programme is strictly for civilian energy generation.

Representatives of six key powers, including Russia, gathered in London on Monday for talks on how to increase pressure on Tehran amid mounting tension over the Islamic republic.

The United States, while insisting it has no military plans against Iran, is beefing up its naval firepower in the Gulf: two US aircraft carrier groups are now there, the highest concentration since the 2003 invasion of Iraq.

And the New Yorker magazine reported Sunday that the United States is stepping up covert operations in Iran in a new strategy that risks sparking an “open confrontation” and benefits Sunni radicals.

The weekly reported that the US Defence Department had formed a special planning group to draw up possible attacks on Iran “that can be implemented, upon orders from the president, within 24 hours.”

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Tuesday, February 27, 2007

College professor spied for Cuba

A Cuban-born university professor and his wife who pleaded guilty to spying for Cuba have been jailed in the US.

Carlos Alvarez, 61, and his 56-year-old wife, Elsa, received a five and three-year term respectively for exchanging coded messages with Cuba.

Both said they took responsibility for their actions but had wanted to establish an open dialogue with Cuba.

But a Miami district judge said that their behaviour had undermined US foreign policy towards the country.

"As we know, a good motive is never an excuse for criminal conduct," Miami Judge Michael Moore said before he sentenced the couple.

The pair were accused of sending coded messages about fellow Cuban-American exiles living in Miami back to Cuba.

Carlos Alvarez was accused of being in contact with Cuban intelligence agencies since 1977.

'Innocuous information'

The psychology professor, based at Florida International University, disguised his identity using the codename David.

His wife also communicated with Cuban agents under the name Deborah but to a lesser extent than her husband.

Before being sentenced, Carlos Alvarez told the court he had once been part of an underground movement that sought to oust Castro's regime but that he later became "an advocate of dialogue."

"I decided to engage in a relation that would require sharing what I consider innocuous information and analysis for access," he said, adding, "The method and channel that I used were unfortunately wrong."

Carlos Alvarez's lawyer claimed that the messages included no secret, classified or defence material and often amounted to no more than "simple gossip".

But US lawyer Matthew Axelord said that the pair had gone to great lengths to conceal their actions.

"This was not idle chit-chat," he said, "Carlos Alvarez was tasked directly by the Cuban intelligence service to provide certain information and he provided that information."

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Terror: Is Tehran Targeting New York?

March 5, 2007 issue - Increasing tensions between Washington and Tehran have revived New York Police Department concerns that Iranian agents may already have targeted the city for terror attacks. Such attacks could be aimed at bridges and tunnels, Jewish organizations and Wall Street, NYPD briefers told security execs last fall, according to a person with access to the briefing materials who asked for anonymity because of the sensitive subject matter.

NYPD officials have worried about possible Iranian-sponsored attacks since a series of incidents involving officials of the Iranian Mission to the United Nations. In November 2003, Ahmad Safari and Alireaza Safi, described as Iranian Mission "security" personnel, were detained by transit cops when they were seen videotaping subway tracks from Queens to Manhattan at 1:10 in the morning. The men later left New York. "We're concerned that Iranian agents were engaged in reconnaissance that might be used in an attack against New York City at some future date," Police Commissioner Raymond W. Kelly told NEWSWEEK. A spokesman for the Iranian Mission in New York said he was aware of the allegations but had no immediate comment.

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Europe's space wars

The Economist Print Edition

Europe should not let Russia's threats deter it from deploying a defence against rogue states with rockets

SINCE the end of the cold war, few of the people of Europe, east or west, have worried much about missiles. In 1987 Ronald Reagan and Mikhail Gorbachev signed a treaty eliminating the medium-range nuclear-tipped ones, such as the Pershings and SS-20s, that had convulsed Europe's politics for much of the 1980s. The angry British women who had set up “peace camps” outside the missile base at Greenham Common eventually rolled up their sleeping bags and went home.

This week the missile wars returned—on two fronts. General Nikolai Solovtsov, commander of Russia's strategic forces, warned Poland and the Czech Republic that if they went ahead with plans to allow the rockets and radars of an American anti-missile system to be installed on their territory, Russian forces would be “capable of having these installations as their targets”. Condoleezza Rice, America's secretary of state, called that “an extremely unfortunate comment”. The Czech foreign minister accused Russia bluntly of “blackmail”.

Where has this sudden squall blown in from? As Russia's president, Vladimir Putin, surely knows, the anti-missile radar the Czechs are receiving, and the battery of anti-missile missiles that may end up in Poland, are not aimed at Russia. They are parts of a defensive shield that NATO has concluded could help defend both America and its European allies from a different threat altogether: the growing danger of long-range missiles, potentially even nuclear-armed ones, from countries such as Iran and North Korea. And the anti-missile missiles may not even in the end be based in Poland.

The Economist has learned that Britain has also made a bid to become the European base for them (see article). This, however, highlights the second front—the battle for domestic public opinion. With the row over the Iraq war still reverberating, this offer will come as a red rag to Britain's vocal anti-everything-Bush-stands-for lobby. Just the sort of poodlish behaviour from Tony Blair's government that we have come to expect, many will fume. Why make Britain more of a target?

For Britain's Labour government, this is already round two of the missile-defence debate. At America's request, it agreed in 2003 to upgrade an early-warning radar system at Fylingdales; that radar is already a working component of America's still developing anti-missile plans. If the Fylingdales decision was controversial, offering to host the interceptors that might shoot down missiles bound for America or Europe as they travel through space is sure to be more so. Yet, as it did last time, the Blair government should welcome a robust debate.
A false alarm

During the cold war, when the doctrine of Mutually Assured Destruction helped to keep the peace, a case could be made that building defences against incoming missiles would be destabilising. So it was not just the usual anti-American crowd that was alarmed when George Bush insisted, soon after becoming president—and eventually Russia accepted—that their long-standing Anti-Ballistic Missile (ABM) treaty be scrapped. By preventing either side from building an effective anti-missile shield, the rules meant neither side had been tempted to strike the other in the belief that it was safe from a counter-attack. Surely scrapping such limits on defences was a mistake? Wasn't Mr Bush planning to bolster America's security at everyone else's expense? And won't extending his anti-missile shield a bit farther over Europe enrage the Russians anew and just end up making everyone less secure?

In fact, scrapping the ABM treaty, far from worsening America-Russia rivalry, left the Russians free to look more realistically to their own defences. And instead of the new arms race that was predicted, America and Russia, no longer enemies, quickly agreed to far deeper cuts in the numbers of strategic warheads they had pointing at each other than either had previously imagined possible.

Mr Putin may not like the Czechs and Poles—former vassals of the old Soviet Union that are now NATO members—volunteering for new missile-defence duty. But putting ten interceptors in Poland, or Britain, or anywhere else in Europe for that matter, will do nothing to blunt Russia's vast nuclear deterrent. America should do more to reassure Mr Putin of that. Indeed, it would reduce tension if the Americans responded to Russia's request to negotiate further arms-control treaties. But the only real damage to Russia from this episode will be self-inflicted: Mr Putin and his generals have reminded the Czechs and the Poles, and others queueing outside the door, why they wanted to join NATO in the first place.
And a real threat

Other governments have come to accept that their security is genuinely at risk from those more limited, but less predictable, threats. Japan and Australia have been co-operating with America to help fend off the danger from North Korea's missiles. Iran's tests of increasingly far-flying rockets, and its repeated refusal to heed UN Security Council deadlines (another passed this week) to end nuclear work that could be abused for bomb-making, have convinced even NATO's sceptics that limited defences can bolster security in Europe too.

Yet it is worth keeping in mind just how limited a role such limited defences can play. Even if the missiles America is still testing can be made to work properly, technology is seldom flawless. At best, therefore, the extra defences can offer a little bit of extra insurance in a crisis, by helping to persuade an aggressor that an attack, or a threatened one in an attempt at nuclear blackmail, might well fail and invite retribution instead.

Might. So the best way of avoiding getting to crisis-point is still to uphold and strengthen the rules against nuclear proliferation. Only far more robust diplomacy than has been tried so far seems likely to discourage Iran from pressing ahead with its nuclear ambitions. And there Russia is key. Mr Putin worked hard to ensure that the first sanctions resolution on Iran, passed in December, was as feeble as he could make it. What folly. A nuclear-armed Iran would bring instability to Russia's borders in a way neither NATO nor the modest American missile defences in Europe ever will.

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U.S., Italian Ambassadors Hurt in Sri Lanka Shelling

Feb. 27 (Bloomberg) -- The U.S. and Italian ambassadors to Sri Lanka were wounded in an artillery attack by Tamil Tiger rebels in the island's east. The Tigers accused the government of putting the diplomats in danger.

Robert Blake and Pio Mariani were injured when shells fired by the Liberation Tigers of Tamil Eelam struck an air force base at Batticaloa at about 8:45 a.m. Sri Lankan time, said Flight Lieutenant Kanishka Rajapaksa, a military spokesman.

Sri Lanka's peace process collapsed last year as fighting broke out in the north and east of the country and two rounds of peace talks in Geneva failed. The LTTE last week marked the fifth anniversary of a cease-fire with the government by saying the army's new offensives will force Tamils to renew their struggle for self-determination.

The Tigers expressed ``shock and sadness'' at the wounding of the diplomats, while saying the government was to blame for their injuries because it didn't inform the rebels the envoys would be in the area.

The ``Sri Lankan government has exposed senior diplomats to danger by allowing aircraft carrying them into an area where they have declared military operations without informing the LTTE in advance,'' the rebels said in a statement, citing their military spokesman S. Ilanthirayan.

Sri Lankan military aircraft bombed ``identified LTTE bases'' in the Batticaloa district after today's attack, military spokesman Upali Rajapakse said. The targets were marked for destruction before the attack he said. A teacher was killed and another was wounded in a bomb attack the Tamil Tigers blamed on government forces, Agence France-Presse reported. The attack came hours after the shelling of the air base by the Tigers.


Blake has minor injuries, military spokesman Upali Rajapakse said. The U.S. Embassy in Colombo issued a statement saying Blake is ``all right.'' Mariani suffered shrapnel wounds to the head and was being taken to a hospital in the capital, Rajapakse said. Italian Foreign Ministry spokesman Pasquale Ferrara said via telephone that Mariani was lightly wounded. Mariani was later discharged from hospital, Ferrara said.

``This is an indication that the LTTE doesn't want any betterment for the people of the east,'' Rajapakse said. ``The visit was part of a tour to see the resettlement of civilians after the takeover of LTTE camps.''

The diplomats were accompanying Mahinda Samarasinghe, the human rights minister, on a visit to the eastern region when the shelling occurred, the military said. At least seven other people, including air force and police personnel and a schoolboy, were hurt, he added.

Army Offensive

Sri Lanka's army this week drove LTTE fighters from four bases near the northeastern port of Trincomalee, one month after capturing 12 rebel camps in the area.

President Mahinda Rajapaksa's office condemned today's attack and said terrorism must be eliminated.

``I take this opportunity to call upon the international community to support the endeavors of the government of Sri Lanka to address the scourge of terrorism and to pressure the LTTE to give up terrorism and return to the democratic fold,'' Foreign Minister Rohitha Bogollagama said in an e-mailed statement.

The Tamil Tigers have been fighting for two decades for a separate homeland in areas of northern and eastern Sri Lanka they control, a conflict that has killed more than 60,000 people in the South Asian island nation of 20 million. The LTTE is classified as a terrorist organization by the U.S., European Union and India.

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Iran's space launch suggests no technology leap

By Doug Richardson, JMR Editor

The launch of Iran's first space research rocket does not represent a significant development in Iranian rocket technology.

The vehicle's performance is similar to that of existing Iranian solid-propellant tactical missiles.

In a statement to Iran's Fars news agency, Ali Akbar Golrou, executive deputy of the Aerospace Research Institute, said that the vehicle was a sounding rocket able to carry a payload to an altitude of 150 km before returning it by parachute.

Sounding rockets are normally launched on near-vertical trajectories in order to attain the greatest height possible from their post-boost velocity. To obtain the maximum range from a rocket of modest performance, it must be fired at an angle of about 45 degrees. (This assumes a flat, non-rotating earth, without an atmosphere, but is a good approximation for short-range tactical missiles.)

Jane's Missiles and Rockets

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Open Source News

Open Source articles:

Open Sources Intelligence

U.S., Indian Officials See Progress on Nuclear Cooperation
US Welcomes North Korean Invitation to UN Nuclear Chief
S. Korean Negotiator Outlines Plans for Disabling Pyongyang's Nuclear Programs
DPR Korea invites UN nuclear chief four years after leaving non-proliferation pact
Israel Calls for Tougher Sanctions on Iran
World Powers Will Meet In London To Discuss Iran
Iran to defend its right to civilian nuclear technology - pres.
Rare Protest in Burma Brought to Quick End
Iranian President Vows to Push Ahead With Nuclear Program
NY Times: US Staged Anti-Terror Campaign from Ethiopia
U.S. Soldier Sentenced In Rape, Murder Of Iraqi Girl
Afghanistan: Amnesty Bill Places Karzai In Dilemma
Iraq: U.S. Adapting To New Insurgent Tactics
U.S. Diplomat Sees Progress in Somalia
Sri Lanka Rebels to Resume Struggle for Homeland
Thousands March on Afghan Capital, Supporting Amnesty for War Criminals
Afghanistan: Taliban Attacks Signal Start Of Spring Offensive
US Senate Democrats Draft Plan to Revise Military's Iraq Mission
Chad: Ban Ki-moon proposes peacekeeping force with some 11,000 personnel
Cheney Says Free Nations Cannot Allow Safe Havens for Terrorism


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Russian Military-Industrial Commission To View Fifth Generation Air-Defense System

Moscow (RIA Novosti): The Military-Industrial Commission, which answers directly to the Russian president, will meet Tuesday to consider prospects for a fifth-generation air-defense system, a senior Russian government official said Monday.

"It will be a field session, which will be held at the Almaz Science and Production Association," said First Deputy Prime Minister Sergei Ivanov, who oversees the defense related sectors.

Ivanov said new S-400 missile systems were adopted for service in late 2006 and will be placed on alert duty later this year.

"It is a unique system that has no parallels [in the world]," he said.

He said priority should now be given to the development of fifth-generation air-defense systems, combining elements of air-, missile-, and space defense.

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Iran Ready For US Talks Without Preconditions

Tehran (AFP): Iran said on Monday it would be ready to examine positively a request by its arch-enemy the United States for talks but would not accept halting sensitive nuclear activities as a precondition. "If the United States presents a request for negotiations through the official channels and it appears these negotiations are constructive and logical, we are ready to examine this request with a positive eye," chief nuclear negotiator Ali Larijani told the IRNA agency.

But he added: "Fixing preconditions means that you have already determined the result of negotiations in advance and it is for this reason that such policies have produced no result up to now."

Iran and the United States have had no diplomatic relations since Washington severed ties in 1980 in the wake of the seizure of its embassy in Tehran by Islamist students.

Any official contacts between the two sides would mark a breakthrough in the frozen relations, which have been marked by mutual recriminations and enmity over almost three decades.

However past overtures for talks have stumbled over Iran's right to enrich uranium in its nuclear programme, a process the West fears Iran could use to produce nuclear weapons.

The UN Security Council has imposed limited sanctions against Tehran over its refusal to suspend uranium enrichment and world powers were to meet in London on Monday in a bid to thrash out a consensus on further measures.

The United States and Israel accuse Iran of seeking nuclear weapons. Tehran denies the charges, insisting that its atomic programme is peaceful in nature.

While US Secretary of State Condoleezza Rice has insisted she is ready for talks with her Iranian counterpart, Washington has always maintained Tehran must halt its uranium enrichment activities first.

If Iran froze enrichment "then we can come to the table and we can talk about how to move forward," Rice said in a US weekend television interview.

"We're all prepared to have full-scale negotiations anytime, at any place," she added.

"We do not accord credibility to declarations made through the media," responded Larijani, head of Iran's supreme national security council, who spoke to IRNA from Pretoria where he has held talks with South African leaders.

However Iranian officials have repeatedly rejected the prospect of suspending enrichment, with President Mahmoud Ahmadinejad on Sunday comparing the Iranian nuclear programme to a train without brakes or reverse gear.

"The great powers have to put an end to our worries and respect the right of Iran," said Deputy Foreign Minister Saeed Jalili, according to the Fars news agency.

"We have done what was necessary to put an end to their worries. It is their job now to end our worries and win our confidence," he added.

The remarks on official talks coincide with an upsurge in speculation that the United States is planning air strikes on Iran to thwart its nuclear programme.

Russian Foreign Minister Sergei Lavrov said on Monday that Moscow was "worried" about the possibility of US military action against Iran.

"We are worried that the forecasts and suppositions of a possible attack on Iran have become more frequent," Lavrov said at a meeting with President Vladimir Putin shown on state television.

Lavrov referred in particular to comments made last week by US Vice President Dick Cheney, who said that "all options are still on the table" for Washington.

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Pristina, 27 Feb. (AKI) - An explosion damaged seven automobiles belonging to the Organisation for Security and Cooperation in Europe (OSCE) in the Kosovo town of Pec on Monday, just hours before former prime minister Ramus Haradinaj left for the Hague to stand trial before the United Nations' tribunal for the former Yugoslavia on charges of crimes against Serb and other civilians during the 1998/99 Kosovo conflict.

"Immediately after the explosion, the police found seven OSCE automobiles damaged at the scene as well as two private vehicles," local police spokesman Avni Djevukaj told media. He said the explosion took place at 3.30 am local time and the police discovered another unexploded device. An investigation of the blasts was continuing and police had no immediate knowledge of the perpetrators or their motives, he said.

Haradinaj, the former commander of the Kosovo Liberation Army (KLA), which started a rebellion against Serbian rule in 1999 in the Pec region, has been indicted by the UN's International Criminal Tribunal for the Former Yugoslavia (ICTY) for alleged crimes against Serbs, Gypsies and ethnic Albanians loyal to Belgrade.

Haradinaj, the leader of the Alliance for the Future of Kosovo, was Kosovo's prime minister when he was indicted in 2004 and surrendered voluntarily to the the ICTY. He was freed in June 2005, pending the start of his trial, which will begin on 5 March. Chief ICTY prosecutor Carla Del Ponte has voiced concern that Haradinaj might influence the court witnesses while free, but the court had even allowed him to continue his public activities.

One of the ICTY potential witnesses was run over by a car and killed in a suspicious accident in Montenegro this month, and Serbian media reported that many other witnesses had in the meantime changed their original statements.

Haradinaj was seen off by hundreds of his supporters at Pristina airport and vowed he would prove his innocence and return home soon. Last week, he was received in a farewell visit by the chief United Nations administrator in Kosovo Joachim Ruecker, as well as by Kosovo president Fatmir Seidiu and prime minister Agim Ceku. ICTY prosecutors had asked Ruecker not to see Haradinaj, but Ruecker ignored the call.

Ceku and Seidiu have said they believe Haradinaj is innocent, while the British-based Observer newspaper noted that Haradinaj had received "unprecedented treatment for someone accused of war crimes." Kosovo, most of whose 90 percent ethnic Albanian majority demands independence, has been under UN control since 1999 and the final round of UN sponsored talks on a proposal for "supervised independence" for the province is due to resume on Tuesday in Vienna.

A Kosovo Serb leader, Rada Trajkovic, said the Pec explosions were aimed at applying pressure on the ICTY to acquit Haradinaj and to steer Vienna talks towards granting independence for the province in which ethnic Albanians outnumber Serbs by 17 to one.

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Monday, February 26, 2007

World court finds Serbia innocent of genocide charge

SERBIA did not commit genocide against Bosnia during the 1992-5 war, the United Nation's highest court has ruled in a landmark case - but it said that the country had violated its responsibility to prevent genocide.

Bosnia had asked the International Court of Justice (ICJ), based in The Hague, to rule on whether Serbia had committed genocide through the killing, rapes and ethnic cleansing that overtook Bosnia during the war.

It was the first time a sovereign state had been tried for genocide, outlawed in a UN convention in 1948 after the Nazi Holocaust of the Jews.

A judgment in Bosnia's favour could have allowed the country to seek billions of pounds of compensation from Serbia.

Judge Rosalyn Higgins, the ICJ president, said the court concluded that the 1995 Srebrenica massacre of thousands of Bosnian Muslim men and boys did constitute genocide, but that other mass killings of Bosnian Muslims did not.

But she said the court ruled that the Serbian state could not be held directly responsible for genocide, so paying reparations to Bosnia would be inappropriate even though Serbia had failed to prevent genocide and punish the perpetrators.

"The court finds by 13 votes to two that Serbia has not committed genocide," she said. "The court finds that Serbia has violated the obligation to prevent genocide ... in respect of the genocide that occurred in Srebrenica."

Some 8,000 Muslims from Srebrenica and surrounding villages in eastern Bosnia were killed in July 1995. The bodies of almost half of them have been found in more than 80 mass graves nearby.

Radovan Karadzic, the Bosnian Serb wartime leader and his military commander, Ratko Mladic, both accused of genocide over Srebrenica, are still on the run.

Reacting to the ruling in Belgrade, the Serbian president, Boris Tadic, urged the country's parliament to condemn the massacre. "For all of us, the very difficult part of the verdict is that Serbia did not do all it could to prevent genocide," he told a news conference.

"Thank God," said Mirko Kocic, a 25-year-old economy student and Belgrade resident. "For once we are cleared of something."

Tomislav Nikolic, an ultra-nationalist Serbian leader, dismissed the World Court proceedings as "part of a conspiracy" to declare the Serbs a "genocidal nation."

In Sarajevo, 160 miles to the south-west, the Bosnian presidency's Muslim member, Haris Silajzic, told Bosnian television: "I am sorry that Serbia and Montenegro were not convicted of genocide and that they were not convicted of conspiracy in genocide."

In front of Serbia's embassy to Bosnia, set on the banks of Sarajevo's Miljacka river, protesters have planted a series of black coffin-shaped headstones in the riverbank, each marked with the name of a Bosnian town.

"Srebrenica," "Foca," "Zepa," read three of them, some of the towns were Serb atrocities were at their worst.

"I am speechless," said Fadila Efendic, whose son and husband were killed in Srebrenica. "We know that Serbia was directly involved. We saw Serbian troops shell us ... and kill our sons and husbands, we saw them commit genocide here."

Sehida Rahmanovic, another massacre survivor, added that "Bosnian Serbs could not have committed genocide without the help in arms, money, troops and everything from Serbia."

Mr Silajdzic's Bosnian-Croat colleague Zeljko Komsic said he was "disappointed" the ruling did not class as genocide other crimes in the war in which at least 170,000 people died, three-quarters of them Muslims and Croats.

"We who were in Bosnia know what happened here right from the beginning of the war and I know what I will teach my kids," Mr Komsic said.

Fatija Suljic, 60, who lost her husband and three sons in Srebrenica, said: "This makes me cry. This is no verdict, no solution. This is a disaster for our people."

Serbia had said a ruling against it would be an unjust and lasting stigma on the state, which overthrew its wartime leader Slobodan Milosevic in 2000.

Milosevic died last year, only months before a verdict in his trial on 66 counts of genocide and war crimes was due.

The UN war crimes tribunal in The Hague has already found individuals guilty of genocide at Srebrenica. Bosnia used evidence from trials there for its case against Serbia.

It is almost 14 years since Bosnia first sued the rump Yugoslav state from which it seceded in 1992, but the case has been repeatedly held up by arguments over jurisdiction.

In 1992, backed by the Yugoslav army, the Serbs captured two-thirds of Bosnia and besieged Sarajevo. Tens of thousands of non-Serbs were killed and hundreds of thousands forced from their homes.

In Brussels, Friso Roscam Abbing, a spokesman for the European Commission, urged both sides to respect the judgment "to ensure justice and enable reconciliation to start".

Nenad Canak, of Serbia's new Social Democrat-Liberal Democratic coalition, said the ruling left him "speechless".

"The only thing I can say is to remind you of the words of Primo Levi written on a wall in Dachau. "The man who denies Auschwitz is the same one who is ready to repeat it."

Meanwhile, in the breakaway Serbian province of Kosovo, teetering on the edge of fresh ethnic violence, the former prime minister headed to the UN court in The Hague on Monday to face a war crimes charges in a trial due to start next week.

Ramush Haradinaj, the Kosovo Albanian leader of the Alliance for the Future of Kosovo, will appear before the UN war crimes tribunal on 5 March on charges of involvement in a criminal plot to murder, rape and torture Serbs and gypsies in the Albanian-dominated province.

Haradinaj, accompanied by his wife, Anita, was cheered by hundreds of supporters as he arrived at the province's main Slatina airport.

Haradinaj was indicted in 2005 and surrendered to the UN court. The highest-ranking Kosovo Albanian to be indicted by the court, he was allowed to return to Kosovo pending the start of the trial and was also permitted to take up his role of president of his political party, which is part of the province's governing coalition.

Seven international vehicles belonging to the OSCE, or Organisation for Security and Co-Operation in Europe, were damaged by an explosion in the town of Peja in western Kosovo, hours before Haradinaj's departure.

Another explosive device was found nearby, said a Kosovo police service spokesman.

• THE powerful post of Bosnia's peace overseer is likely to be extended for a year from July because of concerns about the political stability of the tiny Balkan state.

Nevertheless, European Union officials said the bloc would approve plans today to more than halve its 6,000-strong peace force in Bosnia by June, saying they had few concerns about security.

An extension of the mandate of the Office of the High Representative is expected to be agreed today by Bosnia's Peace Implementation Council, said the spokesman for Christian Schwarz-Schilling, who is due to step down on 30 June.

"There appears to be a consensus that the mandate will be extended for a year," Chris Bennett said.

The post, set up to oversee implementation of the Dayton peace agreement ending the 1992-95 war and giving the holder powers to sack officials and impose laws, had been due for abolition after Mr Schwarz-Schilling stands down.

However, he said last month he would argue against scrapping it due to concerns that an imminent decision on the future of the breakaway province of Kosovo in neighbouring Serbia could raise ethnic tensions in Bosnia.

Bosnian leaders also failed last week to break a year-long deadlock over unification of police forces, a condition for establishing closer ties with the European Union. The EU wants Bosnia to have its 16,000 policemen, now divided into 15 separate police forces, integrated into a single structure that would be politically unbiased and operate across the Balkan country without artificial boundaries.

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Five Officers Killed as Blast Hits Police Base in Chechnya


A blast in Russia’s southern republic of Chechnya killed at least five policemen on Friday, Reuters news agency reports Monday.

The blast rocked an Interior Ministry base in the Gudermes region of Chechnya, a source in the Southern Federal District’s law enforcement services reported.

The incident is under investigation, he said.

Russian leaders say Chechnya, where Russia has fought two wars since 1994, is a stable province undergoing reconstruction.

But Chechen separatists, many of whom say they are fighting in the name of Islam, are able to launch attacks on Russian forces from their mountain hideouts

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Defense News

Defense news articles:

Latest news

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Additional Heavy Tank Transporters for Australian Army
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Read more ...

Venezuela: FARC, ELN Told To Leave


Venezuelan rebel group Bolivarian Liberation Force (FBL) has demanded that Colombian rebel groups the Revolutionary Armed Forces of Colombia and the National Liberation Army suspend their activities in Venezuela, El Universal reported Feb. 26. In a press release sent to El Universal, FBL said it considers the Colombian groups' activities harmful to its insurgency because they are facilitating counterrevolutionary action in Venezuela.

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The Shiite extremist groups in southern Iraq

The Iraqi forces, backed by the US Army, launched an offensive on 28/1/07 near Najaf against a Shiite extremist group named Jund Al-Sama’.

It was the first time that a Shiite extremist group had appeared in southern Iraq - an area largely dominated by the Dawa party, the Sadrists and the Supreme Council for Islamic Revolution in Iraq (SCIRI).

Jund Al-Sama’ is not the only Shiite extremist group active in southern Iraq. There are other groups which work in secret. All work under the Al-Mahdawiya Movement, which is waiting for the Imam Al-Mahdi Al-Muntazar or the Awaited Imam to appear.

Some of these groups are active in Basra, Nassiriyah, Kut, Najaf, Karbala and Maysan, some others in Shiite-populated districts of Baghdad and a part of Diyala province.

Although these groups are Shiite, they include members of other sects, such as Sunni, or Ismaili or Zaidi.

Reports from southern Iraq suggest these groups call on to destroy all public institutions, kill all leaders and clerics to pave the way for the Imam Al-Muntazar.

Besides Jund Al-Sama’, these groups include:

- Ruhullah group, which is active in Nassiriyah and Maysan. Its members are sacked from the Sadrist movement.

- Al-Marsumi group, active in Diyala;

- Ahmad Bin Al-Hasan group, active in Najaf and Karbala

- Jund Al-Islam, active in Basra and Kut

- Al-Hadiya group, active in Kut and Maysan

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Lithuania exploring 'exit strategy' for Belarus leader

EUOBSERVER / BRUSSELS - EU state Lithuania and EU neighbour Georgia are working on an exit strategy for Europe's "last dictator" - Belarus president Aleksander Lukashenko - amid concern that Russian gas and oil hikes against Belarus are part of a wider process threatening the country's independence.

"I recently visited Georgia and I had a lot of discussions with our Georgian colleagues - some of them think we need to propose an exit strategy for Lukashenko," Lithuanian prime minister Gediminis Kirkilas told EUobserver in Vilnius on Friday (23 February).

The prime minister declined to speculate whether such an "exit strategy" could one day see Lukashenko retire to a friendly country such as Venezuela, or whether it would mean a full rapprochement with the EU starting with, say, Belarus' release of senior political prisoner Aleksander Kozulin.

"For the preparation of this strategy we have to have some informal consultation with envoys, such as a former president who can speak Russian [and go to Minsk]," Mr Kirkilas added. "Lukashenko has to take some steps [such as releasing Mr Kozulin]...but we have to work with him, to speak with him."

The prime minister explained that Belarus' conflict with Russia is "much more deep than it seems" in the context of a proposed Russia-Belarus state union that is being resisted by Minsk. "Belarus sovereignty is the main issue. Lukashenko will step down sooner or later, but to have an independent Belarus is very important [for the EU]."

Old allies Russia and Belarus fell out in January when Russia imposed gas and oil hikes set to cost Minsk $1.8 billion a year and that could push it to the edge of economic crisis, with European kremlinologists scratching their heads as to why Moscow made the move.

Russian ambassador to the EU Vladimir Chizhov recently said it is simply designed to fit in with market prices, adding that the old talks on state union are at a "relative standstill" but that all options are still on the table, including the annexation of Belarus by Russia.

Of all the EU states, Lithuania has kept the closest contacts with Minsk since EU-Belarus relations began to deteriorate in the mid-1990s, with Lukashenko and 34 of his officials currently on an EU visa ban list and with EU trade sanctions worth $530 million a year to kick in by July.

The Belarus game is being played out amid EU concern for Mr Lukashenko's mental health. The 53-year old autocratic ruler is a gifted orator and a match-fit ice hockey player. But he is wildly unpredictable in policy terms, prone to emotional outbursts and increasingly self-contradictory statements.

The prospect of Mr Lukashenko one day leading a reformed government and shaking the hands of a European Commission president in Brussels is laughable to most EU diplomats working on the Belarus dossier, while some hardline Belarus activists want him to face justice over disappeared persons.

Other candidates wanted
"We are looking for other people in the Belarus administration that we can talk to," Lithuanian foreign ministry eastern Europe director, Arunas Vinciunas, said last week. The US has also recently hinted it would prefer to work with an alternative leader from the existing government.

EU diplomacy is focussing on approaches to potential reformers at the "low and medium" levels of the Belarus government for now. Lukashenko's former EU ambassador and current foreign minister, Sergei Martynov, was once considered a reformer but lost that reputation after returning to Minsk.

Meanwhile, Mr Lukashenko seems to be grooming his eldest son, Viktor, for succession, having recently appointed him as a senior member of the country's security council and given him two assistants to underline his importance.

The president has also carried out an extensive process of derussification of the Belarusian KGB and military to reduce the risk of a Russian-led palace coup, but many Kremlin-loyal Belarus KGB and military officers remain in the system adding to Mr Lukashenko's unease.

Historically, Belarus has only been independent twice in its entire history - briefly in 1918-1919 and since 1991, with Lukashenko taking the reins in 1994. Ethnic Belarusians make up 81 percent of the 10 million-strong population, with Russians (11%), Poles (4%) and Ukrainians (2%) also forming large groups.

Belarusians recall that surrealist painter Marc Chagall, Hollywood actor Kirk Douglas (a.k.a. Issur Danielovitch) and proto-existentialist writer Fyodor Dostoyevsky have Belarusian origins. "We are not just a territory underneath a gas pipeline," Belarusian activist Natalia Koliada once told EUobserver.

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Security developments in Iraq, Feb 26

Feb 26 (Reuters) - Following are security developments in Iraq as of 1810 GMT on Monday:

BAGHDAD - Iraq's Shi'ite vice president, Adel Abdul-Mahdi, and a cabinet minister were wounded in an apparent assassination attempt when a bomb killed six people at the public works ministry in Baghdad where they were attending a ceremony. An aide said Abdul-Mahdi was taken to hospital after suffering wounds in the blast. At least 31 people were wounded.

BAGHDAD - Iraqi security forces killed 12 insurgents, including two wearing explosive vests, and arrested 117 others, the government said in a statement.

BAGHDAD - At least 1,000 displaced families have returned to their homes since Operation Imposing Law was officially launched about 10 days ago.

* FALLUJA - A U.S. Marine was killed in combat in Anbar province, the U.S. military said.

BAGHDAD - A roadside bomb struck a police patrol, killing two officers and seriously wounding another in the Rustamiya area of southern Baghdad, police said.

ABBASI - A suicide car bomber killed one Iraqi soldier and wounded two others when he attacked a joint U.S.-Iraqi military checkpoint near the small town of Abbasi, 70 km (40 miles) southwest of Kirkuk, police and army sources said.

BAGHDAD - A mortar round killed one civilian and wounded two others when it landed in central Baghdad's commercial Nidhal street, police said.

ISKANDARIYA - At least seven people were wounded when mortar rounds hit the town of Iskandariya, 40 km (25 miles) south of Baghdad, police said.

MOSUL - A roadside bomb wounded two policemen in a patrol in the northern Iraqi city of Mosul, police said.

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The Threat of Grassroots Jihadi Networks: A Case Study from Ceuta, Spain

By Javier Jordán, Robert Wesley

On December 12, 2006, Spanish police executed a spectacular counter-terrorism operation in the neighborhood of "Príncipe Alfonso" in Ceuta (a Spanish city located in North Africa, just south of Gibraltar). Those arrested belonged to a grassroots jihadi group planning attacks on local targets in the Spanish enclave. The following analysis emphasizes the principal characteristics of this former jihadi network and explores two issues of particular importance: 1) the relationship between the network's members and Spanish soldiers garrisoned in Ceuta, and 2) the inclusion and importance of the Spanish cities of Ceuta and Melilla in jihadi rhetoric as Muslim territories that must be liberated from their infidel occupation.

The jihadi group in Ceuta was composed of at least 11 individuals and constitutes another good example of the emergence of grassroots jihadi networks in European countries. "Grassroots jihadis" refers to groups that sympathize with and relate to the global jihadi movement, sharing common strategic objectives, but have little or no formal connections to al-Qaeda or any other associated organizations. They could, however, eventually secure relationships with some established operatives.

The History and Characteristics of the Ceuta Jihadi Network

The group's origins stem from meetings in a small mosque called Darkawia that was dominated by a radical imam and located in the Príncipe Alfonso district—a disadvantaged area of Ceuta, where around 12,000 Muslims live. At the time of the raids, the area was practically considered a conflict zone by local police and residents, with high rates of unemployment and delinquency. In the months preceding the December 12 operation, the local police had resigned from patrolling the neighborhood due to various threats, especially from ambushes by local organized delinquent groups [1].

The majority of the group's members were born in Ceuta and lived in the Príncipe Alfonso district, with all but one having Spanish nationality. Many of the group's members also had criminal records. The principal leader of the jihadi network, Karin Abdelselam Mohamed, became radicalized while serving time in prison for minor crimes. Within the group, the members justified these illegal activities by claiming that they were done in support of jihad, a seemingly common occurrence among jihadis.

In terms of linkages with external jihadi groups, their primary connection was Karin's relationship with Tarik Hamed, who has been incarcerated in Spain since June 2005 for his involvement in a network established to recruit and facilitate travel for recruits heading to the jihad in Iraq. The group's radicalization, however, was largely independent of external mentoring, with its two leaders Karin and Mohamed Fuad Mohamed driving the process. The group's "gatherings," which were held in the mosque outside of normal praying hours and in the homes of its members, played a very important role in the development of the group's radicalization. Another apparent contributing element in this path was the incorporation of jihadi propaganda distributed via CDs containing videos, songs and text archives.

A common characteristic of grassroots networks is that they direct their aggression against targets of close proximity [2]. In the case of the Ceuta network, that hostility underwent several stages of escalation. In the first stage, the network started to spread rumors of possible attacks in the city and painted threatening graffiti around town. The next step consisted of destroying a morabito—a small building that lodges the tomb of people considered holy by Muslims in the Maghreb [3].

The third stage was aborted by the police. At the time of their arrests, the members of the group had already started to plan a high-casualty attack in Ceuta using explosives. They had discussed several targets: a shopping mall, a fairground during a time of festivities and a fuel depository. During their investigations, police found a will of a jihadi and evidence that some of them had expressed their willingness to die as martyrs (El Mundo, December 17, 2006; El País, December 16, 2006).

What has been described, so far, resembles other grassroots networks dismantled in Spain and Europe during the past few years and underlines the vitality of the third jihadi generation (if we follow the terminology used by the strategist Abu Mus'ab al-Suri) [4]. There are two aspects of the Ceuta case, however, that merit special attention.

First, the network tried to recruit Spanish soldiers of Muslim origin born in Ceuta. Approximately 30% of the troops in the Ceuta and Melilla garrisons have Muslim backgrounds. Each of the cities has on paper the equivalent of a light brigade. For many young Muslims born in Spanish territory, the military is an attractive employment opportunity, as many of them encounter difficulties securing jobs in the civil sector. The military provides an acceptable salary and offers the opportunity to learn a profession, while opening the door to other jobs such as occupations in the national and local police services. A significant portion of young soldiers also end up finding stable jobs in the public security domain.

The network's leader, Karin, succeeded in attracting several young soldiers garrisoned in Ceuta to his private meetings. Karin's jihadi group wanted the soldiers to facilitate access to a military deposit of arms and explosives with which to perpetrate further terrorist attacks. The soldiers, however, were not persuaded. Despite the group's overall failure, news of the group's military contacts and the fact that one of the apprehended had been an infantry soldier in Ceuta (and as a consequence had been taught the use of light weapons) produced alarm about the possible infiltration of jihadis in the Muslim ranks of the garrisons.

In addition, this news coincided with the non-renewal of the contracts of more than 15 soldiers of Muslim backgrounds in the Ceuta garrison due to the findings of internal intelligence reports. In fact, the worry over possible infiltration of radical Salafism in the military began much earlier than this recent operation. It was already explicitly mentioned in a military intelligence report leaked to the press in September 2005, which led to the non-renewal of at least three soldiers in the previous months (El País, September 12, 2005; El País, November 5, 2006). The most recent news of non-renewal, however, has helped precipitate an antagonistic climate among the associations and the opinion leaders of the Muslim community, a problem that has been politicized rapidly. La Unión Democrática Ceutí—the political party in Ceuta that receives most of the Muslim vote—has started a protest campaign that has included the distribution of thousands of leaflets at the entryways of mosques denouncing the "persecution of the Spanish soldiers of the Muslim faith" (El País, January 21).

The tension has increased even more with a police union requesting to control Muslim candidates' access to vacancies in the national police coming from Ceuta and Melilla in order to avoid potential infiltration by radicals (there were 434 Ceuta/Melilla Muslim applicants for the most recent entrance examination). This request has also been harshly criticized by Muslim collectives in Ceuta and throughout Spain (EFE, January 25).

It is quite possible that this frictional dynamic will continue or worsen in the future if the two factors evident in this case study continue to be present: a) that grassroots jihadi networks remain resolute in their campaign to attract members of the security services; and b) that thousands of qualified second generation Muslims continue to apply for vacancies in the army and police forces.

In facing this situation, the Spanish government will have to find the appropriate balance between protecting the constitutional right to non-discrimination regardless of ethnicity or religion and necessary counter-intelligence activities. It is an equation which will require discretion and an acute sense of the social climate from policymakers in the military and police intelligence units to avoid additional polarization and the permissive conditions that could further recruitment and radicalization in local communities.

Another salient aspect of this case is its implications for future networks to operate in the region based on the grievances emerging from local interests (i.e. perceived discrimination in the military), and those emanating from exogenous jihadi propaganda. The Ceuta counter-terrorist operation overlapped with an increase in global jihadi rhetoric concerning the rightful ownership of the cities of Ceuta and Melilla. Although there is apparently no relationship between this most recent network's activities and these claims, such rhetoric cannot be overlooked when considering the future of jihadi activity in the region.

In May 2006, a direct threat to Spanish interests appeared in the radical al-Ansar forum, in which the fight for the liberation of Ceuta and Melilla was compared with those of Iraq, Chechnya and Kashmir. The communiqué was posted by a group calling itself Nadim al- Magrebi, which is the name occasionally used by an Algeria-based jihadist network (El País, November 5, 2006).

The communiqué quite naturally caused alarm throughout Spanish counter-terrorism agencies. Even more worrying, however, was the reference to Ceuta and Melilla as occupied cities in the December 20, 2006 diatribe of Ayman al-Zawahiri. These types of proclamations have the potential to pressure or motivate groups acting in the Maghreb or in Spanish territory to plot new attacks on Spanish interests.

This threat could be compounded further by the recent partnering initiatives of groups operating in the Maghreb (i.e. the GSPC's tactic of changing its name to "Al-Qaeda in the Maghreb"). These more established groups are in part attempting to harness the potential of such local grievances and grassroots groups to further their agenda of reinvigorating their beleaguered movements.


1. Javier Jordan & Humberto Trujillo, Favourable situations for the jihadist recruitment: The neighbourhood of Principe Alfonso (Ceuta, Spain), Jihad Monitor Occasional Paper No. 3, November 27, 2006.
2. This hostility can also be observed in other European networks such as the Hofstad Group that assassinated Theo Van Gogh, the network that authored the Madrid attacks, as well as other Spanish-based groups arising after the March 11, 2004 attacks.
3. Their construction and veneration constitutes a habitual practice in the north of Morocco; nevertheless, it is considered abominable by Salafis.
4. Brynjar Lia, "Al-Suri's Doctrines for Decentralized Jihadi Training," Part 1 and 2, Terrorism Monitor, January 18 and February 1.

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