IMF says Bangladesh loan program on track

WASHINGTON: The International Monetary Fund on Thursday said Bangladesh was making progress with reforms under an IMF loan program and may be eligible for the second aid payment.

An IMF mission to Dhaka met with senior Bangladeshi officials in the first review of the country's performance under a $987 million Extended Credit Facility granted in April.

Bangladesh's performance under the loan program so far has been generally sound, said IMF mission leader David Cowen.

"Quantitative targets are broadly on track, with all performance criteria met at end-June 2012 -- the first test date under the ECF," he said in a statement.

Under the three-year loan deal, Bangladesh has pledged wide-reaching structural reforms to get its economy back on track and ease long-term poverty.

Bangladesh received some $141 million in an initial disbursement in April.

Cowen noted progress on structural measures as well as commitments by the government on several measures, including containing the budget deficit to 4.5 percent of gross domestic product in fiscal 2013.

The government also pledged to boost efforts to curb subsidy costs, particularly through a fuel price adjustment formula, and to take steps to lessen the negative impact on the most vulnerable.

The IMF Executive Board is expected to complete its review in January, which would make the second disbursement of some $141 million available to Bangladesh.

The government sought the IMF aid after rising global oil prices delivered a double whammy, spurring inflation and taking scarce foreign currency out of the country.

Under the IMF agreement, the government must hike prices of oil, power and fertilizer to bolster the country's shaky balance of payments. But poor farmers have relied on deep subsidies for decades.

"Despite global headwinds, Bangladesh's economy performed well in FY12, with preliminary estimates pegging growth at 6.3 percent," Cowen said.

The IMF projects GDP growth of about 6 percent in the current fiscal year, citing external uncertainties and the broader global slowdown.

-AFP/ac

Read More..

Shinde called all-party meet on Telangana to know views afresh: Ghulam Nabi Azad

HYDERABAD: Home minister Sushil Kumar Shinde has convened all-party meeting on Telangana on December 28 as he has recently taken over and wants to know the views of the parties on the issue, Congress leader Ghulam Nabi Azad said.

Azad, the union health minister and in charge of party affairs in Andhra Pradesh, recalled that the central government earlier held two all-party meetings on the issue.

"Since Mr Sushil Kumar Shinde recently took over, he has called the meeting to know the views afresh," Azad told reporters here Thursday.

The central leader's statement may come as a disappointment for a section of Congress MPs from Telangana, who are expecting a positive decision by the central government for separate statehood to Telangana region, which comprises 10 districts including Hyderabad.

Bowing to the pressure from seven Congress MPs, the central government Wednesday agreed to call the all-party meeting.

Azad said a decision was yet to be taken on the number of representatives each party can send to the meet. He hoped that all parties will participate and express their views frankly.

"There are divergent views over Telangana. Some want Telangana state, some want both Telangana and Andhra and there also others who want the state to remain united," he said.

In the all-party meetings held in the past, the parties had taken diametrically opposite stands.

Azad also held talks with former chief of state Congress D. Srinivas and state minister K Jana Reddy, both hailing from Telangana.

Meanwhile, chief minister N Kiran Kumar Reddy and state Congress chief Botsa Satyanarayana met Azad and demanded that the proposed all-party meet on Telangana be either advanced or postponed as its date is clashing with the World Telugu Conference at Tirupati.

Read More..

Celebrations planned as Wash. legalizes marijuana

SEATTLE (AP) — Legal marijuana possession becomes a reality under Washington state law on Thursday, and some people planned to celebrate the new law by breaking it.

Voters in Washington and Colorado last month made those the first states to decriminalize and regulate the recreational use of marijuana. Washington's law takes effect Thursday and allows adults to have up to an ounce of pot — but it bans public use of marijuana, which is punishable by a fine, just like drinking in public.

Nevertheless, some people planned to gather at 12:01 a.m. PST Thursday to smoke in public beneath Seattle's Space Needle. Others planned a midnight party outside the Seattle headquarters of Hempfest, the 21-year-old festival that attracts tens of thousands of pot fans every summer.

"This is a big day because all our lives we've been living under the iron curtain of prohibition," said Hempfest director Vivian McPeak. "The whole world sees that prohibition just took a body blow."

In another sweeping change for Washington, Gov. Chris Gregoire on Wednesday signed into law a measure that legalizes same-sex marriage. The state joins several others that allow gay and lesbian couples to wed.

That law also takes effect Thursday, when gay and lesbian couples can start picking up their wedding certificates and licenses at county auditors' offices. Those offices in King County, the state's largest and home to Seattle, and Thurston County, home to the state capital of Olympia, planned to open the earliest, at 12:01 a.m. Thursday, to start issuing marriage licenses. Because the state has a three-day waiting period, the earliest that weddings can take place is Sunday.

The Seattle Police Department provided this public marijuana use enforcement guidance to its officers via email Wednesday night: "Until further notice, officers shall not take any enforcement action — other than to issue a verbal warning — for a violation of Initiative 502."

Thanks to a 2003 law, marijuana enforcement remains the department's lowest priority. Even before I-502 passed on Nov. 6, police rarely busted people at Hempfest, despite widespread pot use, and the city attorney here doesn't prosecute people for having small amounts of marijuana.

Officers will be advising people to take their weed inside, police spokesman Jonah Spangenthal-Lee wrote on the SPD Blotter. "The police department believes that, under state law, you may responsibly get baked, order some pizzas and enjoy a 'Lord of the Rings' marathon in the privacy of your own home, if you want to."

Washington's new law decriminalizes possession of up to an ounce for those over 21, but for now selling marijuana remains illegal. I-502 gives the state a year to come up with a system of state-licensed growers, processors and retail stores, with the marijuana taxed 25 percent at each stage. Analysts have estimated that a legal pot market could bring Washington hundreds of millions of dollars a year in new tax revenue for schools, health care and basic government functions.

But marijuana remains illegal under federal law. That means federal agents can still arrest people for it, and it's banned from federal properties, including military bases and national parks.

The Justice Department has not said whether it will sue to try to block the regulatory schemes in Washington and Colorado from taking effect.

"The department's responsibility to enforce the Controlled Substances Act remains unchanged," said a statement issued Wednesday by the Seattle U.S. attorney's office. "Neither states nor the executive branch can nullify a statute passed by Congress" — a non-issue, since the measures passed in Washington and Colorado don't "nullify" federal law, which federal agents remain free to enforce.

The legal question is whether the establishment of a regulated marijuana market would "frustrate the purpose" of the federal pot prohibition, and many constitutional law scholars say it very likely would.

That leaves the political question of whether the administration wants to try to block the regulatory system, even though it would remain legal to possess up to an ounce of marijuana.

Colorado's measure, as far as decriminalizing possession goes, is set to take effect by Jan. 5. That state's regulatory scheme is due to be up and running by October 2013.

___(equals)

Johnson can be reached at https://twitter.com/GeneAPseattle

Read More..

Deadly, or Just Misused? Feds Sue Nap Nanny

The Consumer Product Safety Commission is taking action against the makers of a portable baby recliner called the Nap Nanny after five infant deaths linked to the product.

The commission filed a complaint Wednesday to force the manufacturer, Baby Matters LLC, to pull its product off store shelves and offer full refunds to their customers. In addition to the five deaths, the commission says there have been 70 complaints about children falling out of the Nap Nanny.

The commission says normally it can work things out with manufacturers to voluntarily recall a dangerous product, but for five months the makers of Nap Nanny have defiantly refused to pull its product or offer refunds.

"We believe it is a hazardous product and we are concerned about the safety of the children that are in there," Consumer Product Safety Commission spokesman Alex Flip told ABC News.

Baby Matters LLC describes the Nap Nanny as an infant recliner designed to increase the baby's comfort.

"We had to take action because of the number of incidences, and that is why we have filed this complaint against the company. They would not agree to a voluntary recall," Flip said.

The Nap Nanny was invented by a Philadelphia sportscaster and mother Leslie Gudel. She came up with the idea after learning her daughter would only fall asleep in the car seat.

New Findings on Breast Cancer Drug Tamoxifen Watch Video

Carbon Monoxide Leak Sickens School Children, Teachers Watch Video

In a statement posted on Nap Nanny's website, Gudel said she is heartbroken for the families who have lost a child, but says the victims' parents misused her product by either not strapping the baby in or placing the device on a table or in a crib.

Some of the cases involved recliners that were placed in a crib, which the company has urged parents not to do.

"We do not believe the complaint has merit and stand behind the safety of our product when used as instructed," Gudel wrote in the statement. "The Nap Nanny should be placed on the floor with the harness secured."

Gudel says that the ongoing battle with the CPSC has cost her company so much money that it was forced to close last month.

"Another small business is gone. Twenty-two Americans are out of work between Nap Nanny and our supplier. This doesn't take into account the financial impact our closure has had on our other U.S. suppliers," Gudel wrote.

The first infant death was reported in 2010, which caused Nap Nanny to recall the product that same year and raise the sides of the recliner. The manufacturer also posted warnings and made an instructional video for parents.

According to the complaint, in April 2010, a six-month old died when she suffocated while using the Generation Two Nap Nanny. The infant was not secured in the harness and the medical examiner ruled the cause of death was positional asphyxia.

In July 2010, a four-month old died when she suffocated between a Generation Two Nap Nanny and the bumper in her crib. This time, the infant was secured in the harness but it failed to adequately restrain her in the recliner.

Still, the maker of the Nap Nanny stands by their product and says they have gone to "great lengths to make the safest product possible."

"No infant using the Nap Nanny properly has ever suffered an injury requiring medical attention," Gudel said in the statement.

Some 5,000 Nap Nanny Generation One and 50,000 Generation Two models were sold between 2009 and early 2012. About 100,000 Chill models have been sold since January 2011, reports The Associated Press.

Read More..

Military halts clashes as political crisis grips Egypt

CAIRO (Reuters) - Egypt's Republican Guard restored order around the presidential palace on Thursday after fierce overnight clashes killed seven people, but passions ran high in a struggle over the country's future.

The Islamist president, Mohamed Mursi, criticized by his opponents for his silence in the last few days, was due to address the nation later in the day, state television said.

Hundreds of his supporters who had camped out near the palace overnight withdrew before a mid-afternoon deadline set by the Republican Guard. Dozens of Mursi's foes remained, but were kept away by a barbed wire barricade guarded by tanks.

The military played a big role in removing President Hosni Mubarak during last year's popular revolt, taking over to manage a transitional period, but had stayed out of the latest crisis.

Mursi's Islamist partisans fought opposition protesters well into the early hours during dueling demonstrations over the president's decree on November 22 to expand his powers to help him push through a mostly Islamist-drafted constitution.

Officials said seven people had been killed and 350 wounded in the violence, for which each side blamed the other. Six of the dead were Mursi supporters, the Muslim Brotherhood said.

The street clashes reflected a deep political divide in the most populous Arab nation, where contrasting visions of Islamists and their liberal rivals have complicated a struggle to embed democracy after Mubarak's 30-year autocracy.

The United States, worried about the stability of an Arab partner which has a peace deal with Israel and which receives $1.3 billion a year in U.S. military aid, has urged dialogue.

The commander of the Republican Guard said deployment of tanks and troop carriers around the presidential palace was intended to separate the adversaries, not to repress them.

"The armed forces, and at the forefront of them the Republican Guard, will not be used as a tool to oppress the demonstrators," General Mohamed Zaki told the state news agency.

Hussein Abdel Ghani, spokesman of the opposition National Salvation Front, said more protests were planned, but not necessarily at the palace in Cairo's Heliopolis district.

"Our youth are leading us today and we decided to agree to whatever they want to do," he told Reuters.

UNITY APPEAL

Egypt plunged into renewed turmoil after Mursi issued his November 22 decree and an Islamist-dominated assembly hastily approved a new constitution to go to a referendum on December 15.

The Supreme Guide of the Brotherhood, to which Mursi belonged before he was narrowly elected president in June, appealed for unity. Divisions among Egyptians "only serve the nation's enemies", Mohamed Badie said in a statement.

Rival factions used rocks, petrol bombs and guns in the clashes around the presidential palace.

"We came here to support President Mursi and his decisions. He is the elected president of Egypt," said demonstrator Emad Abou Salem, 40. "He has legitimacy and nobody else does."

Opposition protester Ehab Nasser el-Din, 21, his head bandaged after being hit by a rock the day before, decried the Muslim Brotherhood's "grip on the country", which he said would only tighten if the new constitution is passed.

Another protester, Ahmed Abdel-Hakim, 23, accused the Brotherhood of "igniting the country in the name of religion".

Mursi's opponents accuse him of seeking to create a new "dictatorship". The president says his actions were necessary to prevent courts still full of judges appointed by Mubarak from derailing a constitution vital for Egypt's political transition.

Mursi has shown no sign of buckling under pressure from protesters, confident that the Islamists, who have dominated both elections since Mubarak was overthrown, can win the referendum and the parliamentary election to follow.

Mahmoud Hussein, the Brotherhood's secretary-general, said holding the plebiscite was the only way out of the crisis, dismissing the opposition as "remnants of the (Mubarak) regime, thugs and people working for foreign agendas".

As well as relying on his Brotherhood power base, Mursi may also tap into a popular yearning for stability and economic revival after almost two years of political turmoil.

The Egyptian pound sank on Thursday to its lowest level in eight years, after previously firming on hopes that a $4.8 billion IMF loan would stabilize the economy. The Egyptian stock market fell 4.4 percent after it opened.

Foreign exchange reserves fell by nearly $450 million to $15 billion in November, indicating that the Central Bank was still spending heavily to bolster the pound. The reserves stood at about $36 billion before the anti-Mubarak uprising.

(Additional reporting by Tom Perry and Yasmine Saleh; Writing by Alistair Lyon; Editing by Giles Elgood)

Read More..

Football: West Ham recommended for Olympic Stadium move

LONDON: West Ham United took an important step towards moving into London's Olympic Stadium after being granted 'first bidder' status by the London Legacy Development Corporation (LLDC) on Wednesday.

The Premier League team are competing with third-tier football club Leyton Orient, a football business college and a Formula One racing group to become permanent tenants of the east London arena.

"We had four good bids, as everybody knows. The bid that has been ranked top is West Ham United. I am very pleased about that," said LLDC chairman and London Mayor Boris Johnson.

"It will, if it goes through, mean a football legacy for the stadium but there is still a lot of negotiation to go on between the LLDC and West Ham United about the terms of the deal."

The LLDC board voted unanimously to make West Ham their first choice to occupy the arena.

West Ham's preferred bidder status does not involve the signing of any contracts but it puts the club in pole position to secure the 99-year lease on the stadium.

"In selecting West Ham United, the LLDC have secured a long-term viable financial future for the (Olympic) Park," said West Ham vice-chairman Karren Brady.

"On behalf of West Ham United, I feel privileged to have been granted the responsibility to play a key part in delivering a true Games legacy.

"We are now committed to working closely with our new partners and stakeholders in the Stadium to successfully conclude our discussions and bring our collective ambitions to fruition."

The Olympic Stadium, which cost £486 million ($782.7 million, 598.7 million euros) to construct, has been vacant since the end of the Paralympics in September.

Before West Ham could move in, the stadium would have to be converted into a football ground with retractable or moveable seating over the running track.

As part of a pre-existing legacy agreement, the stadium must continue to be used as an athletics venue.

Any future tenants would therefore have to share the ground with UK Athletics, while the 2017 World Athletics Championships are scheduled to take place at the stadium.

A final agreement would also be dependent on the new tenants securing funding for adjustments to the stadium, gaining planning permission and obtaining approval from the appropriate national governing bodies.

The LLDC, meanwhile, will be keen to make sure that taxpayer investment in the initial construction of the venue is protected so that any future benefits will be equally shared between investors.

"There is no deal-breaker as such," said Johnson.

"It is just a question of making sure that an asset, which is a public asset and something that taxpayers put half a billion pounds into, that the value of that is properly reflected in the commercial deal that is now being done with a private sector entity.

"People will understand that my job is to get the best possible deal for the taxpayer."

The LLDC confirmed earlier this month that the stadium will not re-open until 2015 at the earliest.

West Ham hope that leaving their current 35,000-capacity Upton Park home for the much larger Olympic Stadium would enable them to compete with the leading clubs in the Premier League.

-AFP/ac

Read More..

Airlines asked to display the range of fares for each route

MUMBAI: The Directorate General of Civil Aviation (DGCA) has asked domestic airlines to display tariff, slab wise on each route they operate so as to bring transparency in pricing and the consumer will have an idea of the highest and lowest fares on offer for a particular route.

For the sake of transparency, the DGCA has asked scheduled domestic airlines to display established tariff route-wise and fare category-wise on monthly basis and also to notify noticeable changes to DGCA within 24 hours of effecting such a change, said a release issued by the press information bureau.

"The intention behind the above directions is to keep the passengers informed of pricing pattern of airlines. Further, DGCA also monitors tariff on specific sectors on regular basis,'' the release added.

The peak travel season during this Diwali saw airfares on several domestic routes jump to new levels.
"Airfares applicable for domestic passengers are determined by the market forces and are not fixed by the government. Airfares are dependent upon ATF prices, Airport Development Charges, Passenger Services fee, Foreign exchange rates, Service Tax, etc. Fluctuations in any of these components affect the airfares,'' the release added.

"Scheduled airlines offer different fare buckets for each flight and the airfares offered by the airlines in lower bucket are affordable. The airfares increase with the increase in demand for seat, as the lower fare buckets get sold out fast. Random monitoring of domestic airfares revealed that the airfares are remaining within the fare band made available by the scheduled airlines on their respective websites,'' it said.

Read More..

Longer tamoxifen use cuts breast cancer deaths

Breast cancer patients taking the drug tamoxifen can cut their chances of having the disease come back or kill them if they stay on the pills for 10 years instead of five years as doctors recommend now, a major study finds.

The results could change treatment, especially for younger women. The findings are a surprise because earlier research suggested that taking the hormone-blocking drug for longer than five years didn't help and might even be harmful.

In the new study, researchers found that women who took tamoxifen for 10 years lowered their risk of a recurrence by 25 percent and of dying of breast cancer by 29 percent compared to those who took the pills for just five years.

In absolute terms, continuing on tamoxifen kept three additional women out of every 100 from dying of breast cancer within five to 14 years from when their disease was diagnosed. When added to the benefit from the first five years of use, a decade of tamoxifen can cut breast cancer mortality in half during the second decade after diagnosis, researchers estimate.

Some women balk at taking a preventive drug for so long, but for those at high risk of a recurrence, "this will be a convincer that they should continue," said Dr. Peter Ravdin, director of the breast cancer program at the UT Health Science Center in San Antonio.

He reviewed results of the study, which was being presented Wednesday at a breast cancer conference in San Antonio and published by the British medical journal Lancet.

About 50,000 of the roughly 230,000 new cases of breast cancer in the United States each year occur in women before menopause. Most breast cancers are fueled by estrogen, and hormone blockers are known to cut the risk of recurrence in such cases.

Tamoxifen long was the top choice, but newer drugs called aromatase inhibitors — sold as Arimidex, Femara, Aromasin and in generic form — do the job with less risk of causing uterine cancer and other problems.

But the newer drugs don't work well before menopause. Even some women past menopause choose tamoxifen over the newer drugs, which cost more and have different side effects such as joint pain, bone loss and sexual problems.

The new study aimed to see whether over a very long time, longer treatment with tamoxifen could help.

Dr. Christina Davies of the University of Oxford in England and other researchers assigned 6,846 women who already had taken tamoxifen for five years to either stay on it or take dummy pills for another five years.

Researchers saw little difference in the groups five to nine years after diagnosis. But beyond that time, 15 percent of women who had stopped taking tamoxifen after five years had died of breast cancer versus 12 percent of those who took it for 10 years. Cancer had returned in 25 percent of women on the shorter treatment versus 21 percent of those treated longer.

Tamoxifen had some troubling side effects: Longer use nearly doubled the risk of endometrial cancer. But it rarely proved fatal, and there was no increased risk among premenopausal women in the study — the very group tamoxifen helps most.

"Overall the benefits of extended tamoxifen seemed to outweigh the risks substantially," Dr. Trevor Powles of the Cancer Centre London wrote in an editorial published with the study.

The study was sponsored by cancer research organizations in Britain and Europe, the United States Army, and AstraZeneca PLC, which makes Nolvadex, a brand of tamoxifen, which also is sold as a generic for 10 to 50 cents a day. Brand-name versions of the newer hormone blockers, aromatase inhibitors, are $300 or more per month, but generics are available for much less.

The results pose a quandary for breast cancer patients past menopause and those who become menopausal because of their treatment — the vast majority of cases. Previous studies found that starting on one of the newer hormone blockers led to fewer relapses than initial treatment with tamoxifen did.

Another study found that switching to one of the new drugs after five years of tamoxifen cut the risk of breast cancer recurrence nearly in half — more than what was seen in the new study of 10 years of tamoxifen.

"For postmenopausal women, the data still remain much stronger at this point for a switch to an aromatase inhibitor," said that study's leader, Dr. Paul Goss of Massachusetts General Hospital. He has been a paid speaker for a company that makes one of those drugs.

Women in his study have not been followed long enough to see whether switching cuts deaths from breast cancer, as 10 years of tamoxifen did. Results are expected in about a year.

The cancer conference is sponsored by the American Association for Cancer Research, Baylor College of Medicine and the UT Health Science Center.

___

Marilynn Marchione can be followed at http://twitter.com/MMarchioneAP

Read More..

Fiscal Cliff: Can Savings Be Found Without Sacrifice?

How does one come up with $4 trillion in revenue and spending cuts?

That's the question members of Congress, the Obama administration and fiscal experts around the country are grappling with as "fiscal cliff" talks continue to stall.

The fiscal cliff is a combination of the soon-to-expire Bush tax cuts coupled with a series of deep budgetary cuts to defense and domestic programs- the ultimate goal of which is to help stabilize the deficit going forward. While there is no exact amount of savings and revenue that would stabilize the country's debt- the number varies somewhat depending on who you ask- the generally agreed upon range is around $4 trillion.

Republicans and Democrats are drawing lines in the ideological sand. Democrats want to let the Bush tax cuts expire for the highest income earners, effectively raising tax rates on the top 2 percent of earners, which Republicans oppose. Republicans want to look at entitlement reforms- Medicare, Medicaid, Social Security, which Democrats oppose. The seemingly staunch stands beg the question--is there any way to reach a deal that would start to generate close to $4 trillion that does not involve raising taxes or reforming entitlement programs?

It's fiscally possible, but it's inconvenient and unlikely.

There are a series of trims that the government could make to the budget that would save a few billion here and there. Ideas that have been suggested include doubling the airline fee for a non-stop flight from $2.50 to $5, reforming our immigration detention programs, and prison reform.

Fiscal Cliff: What Republicans, Democrats Agree on So Far Watch Video

'Fiscal Cliff': John Boehner Makes Counteroffer Watch Video

Washington, D.C., Gridlocked as Fiscal Cliff Approaches Watch Video

But those ideas don't generate a great deal of savings in and of themselves. The airline fee increasing for example, it's estimated that raising the non-stop flight fee to $5 would only generate an additional $1 billion a year--$10 billion over the course of 10 years.

Prison reform is another avenue of savings. A study from the Vera Institute of Justice released in January, 2012 showed that in the fiscal year of 2010 the total cost for taxpayers of the nation's federal prisons was $39 billion--which was a little more than $5 billion more than the states' combined corrections budgets that year. The cost of an inmate per taxpayer on average was $31,286.

Reforming the system could trim that cost, but it's a complicated endeavor that lacks a single, or even simple handful of solutions, and at the end of the day wouldn't generate the hundreds of billions of dollars in savings needed to begin approaching the trillions in savings and revenue the government is looking for.

Those big savings, experts point out, are found in entitlements and taxes.

"The high-end Bush tax cuts generate a trillion dollars over 10 years. That's a quarter of the task of stabilizing the debt...That's achievable," said Chuck Marre, director of Federal Tax Policy at the Center on Budget and Policy Priorities. "If they just pass the tax cuts for 98 percent of the people only, by default that (revenue) happens and that's significant. Then you need to figure out where does the rest of the money come from?"

And a significant area where that money comes from, experts suggest, is entitlement spending.

"I'm sure there are some small programs that could be eliminated or curtailed but it would be a drop in the ocean of spending represented by entitlements," said Isabel Sawhill, a senior fellow at the Brookings Institution.

Social Security, Medicaid and Medicare, are categorized as mandatory spending in the government's fiscal budget. In the 2010 fiscal year 55 percent of the budget went to mandatory spending. Within that 55 percent, Social Security, Medicare and Medicaid made up a total of 71 percent combined, according to figures from the Center on Budget and Policy Priorities.

It's these avenues that will likely be the quickest and least complicated means of generating the savings necessary to stabilize the debt. Of course, the irony is, these avenues are also the most politically sacred, making a simple and painless fix to the problem effectively impossible.

Read More..

Egypt's vice president suggests way out of crisis

CAIRO (Reuters) - Egypt's vice president proposed ideas on Wednesday to defuse unrest over a draft constitution that has polarized the most populous Arab nation, with Islamists fighting opposition protesters near the presidential palace.

Vice President Mahmoud Mekky said amendments to disputed articles could be agreed with the opposition. A written agreement could then be submitted to the next parliament, to be elected after a referendum on the constitution on December 15.

"There must be consensus," he told a news conference, saying opposition demands must be respected to overcome the crisis.

Egyptian opposition leader Amr Moussa said President Mohamed Mursi should make a formal offer for dialogue, rather than what Mekky had presented as personal ideas to resolve the row.

A senior Muslim Brotherhood official said Mekky's proposals needed to be crystallized.

"We are ready when there is something formal, something expressed in definite terms, we will not ignore it, especially if there is something useful," Moussa told Reuters during talks with other opposition figures.

The website of Al-Ahram said opposition leaders were discussing Mekky's proposals.

They have previously urged Mursi to retract a decree widening his powers, defer the plebiscite and agree to revise the constitution, but have not echoed calls from street protesters for his overthrow and the "downfall of the regime".

Mursi had returned to work at his compound a day after it came under siege from protesters furious at his assumption of extraordinary powers via an edict on November 22.

Mursi, narrowly elected by popular vote in June, said he acted to stop courts still full of judges appointed by ousted strongman Hosni Mubarak from derailing a constitution meant to complete a political transition in Egypt, long a strategic ally of Washington and signatory to a 1979 peace deal with Israel.

Rival groups threw stones at each other outside the presidential palace in northern Cairo on Wednesday. Islamist supporters of Mursi tore down tents erected by leftist foes, who had begun a sit-in there.

"They hit us and destroyed our tents. Are you happy, Mursi? Aren't we Egyptians too?" asked protester Haitham Ahmed.

Dozens of opposition supporters streamed away from the palace as hundreds of Islamists arrived, shouting, "God is greatest. The people support the president's decision."

Mohamed Mohy, a pro-Mursi demonstrator who was filming the scene, said: "We are here to support our president and his decisions and save our country from traitors and agents."

Facing the gravest crisis of his six-month-old tenure, Mursi has shown no sign of buckling, confident that Islamists can win the referendum and a parliamentary election to follow.

Many Egyptians yearn for an end to political upheaval that has scared off investors and tourists, damaging the economy.

Mekky said street mobilization by both sides posed a "real danger" to Egypt. "If we do not put a stop to this phenomenon right away ..., where are we headed? We must calm down."

DIALOGUE

U.S. Secretary of State Hillary Clinton weighed into Egypt's political debate, saying dialogue was urgently needed on the new constitution, which should "respect the rights of all citizens".

Clinton and Mursi worked together last month to broker a truce between Israel and Hamas Islamists in the Gaza Strip.

"It needs to be a two-way dialogue ... among Egyptians themselves about the constitutional process and the substance of the constitution," Clinton told a news conference in Brussels.

Washington is worried about rising Islamist power in Egypt, a staunch security partner under Mubarak, who preserved Cairo's peace treaty with Israel, a pact still bolstered by billions of dollars of U.S. military and economic assistance.

The Muslim Brotherhood, to which Mursi belonged before he was elected, had summoned supporters to an open-ended demonstration at the presidential palace on Wednesday to respond to "oppressive abuses" by opposition parties.

Brotherhood spokesman Mahmoud Ghozlan was quoted on its Facebook page as saying opposition groups "imagined they could shake legitimacy or impose their views by force".

Essam el-Erian, deputy head of the Brotherhood's political party, said: "The president will not retreat, and if the state apparatus is weakened by the wounds of the previous period, then the people can impose their will and protect legitimacy."

Leftist opposition leader Hamdeen Sabahy promptly urged his supporters to go to the streets as well, heightening the chances of confrontation between Islamists and their opponents.

Responding to the scuffles at the palace, opposition leader Mohamed ElBaradei urged Mursi via Twitter to protect protesters there if he wants to keep "what remains of his legitimacy".

About 10,000 protesters had encircled the palace on Tuesday for what organizers dubbed a "last warning" to Mursi. "The people want the downfall of the regime," they chanted, roaring the signature slogan of last year's uprising against Mubarak.

Officials said 35 protesters and 40 police were wounded.

"LEAVE"

The "last warning" may turn out to be one of the last gasps for a disparate opposition that has little chance of scuttling next week's vote on a constitution drawn up over six months and swiftly approved by an Islamist-dominated assembly.

Protesters have scrawled "leave" over Mursi's palace walls, but the president has made clear he is not going anywhere.

Ahmed Kamel, spokesman for the Congress Party led by former Arab League chief Amr Moussa, said Mursi should meet opposition demands, not call for an Islamist counter-demonstration.

Opposition leaders have urged Mursi to scrap his decree, defer the referendum and agree to revise the constitution, but have not echoed protesters' calls for his overthrow.

"The demands of the street are moving faster than those of the politicians," said Elijah Zarwan, a fellow with the European Council on Foreign Relations.

State institutions, with the partial exception of the judiciary, have mostly fallen in behind Mursi.

The army, the muscle behind all previous Egyptian presidents in the republic's six-decade history, has gone back to barracks, having apparently lost its appetite to intervene in politics.

In a bold move, Mursi sacked Mohamed Hussein Tantawi, the Mubarak-era army commander and defence minister, in August and removed the sweeping powers that the military council, which took over after Mubarak fell, had grabbed two months earlier.

The liberals, leftists, Christians, ex-Mubarak followers and others opposed to Mursi have yet to generate a mass movement or a grassroots political base to challenge the Brotherhood.

Investors have seized on hopes that Egypt's turbulent transition, which has buffeted the economy for two years, may soon head for calmer waters, sending stocks 1.6 percent higher after a 3.5 percent rally on Tuesday.

Egypt has turned to the IMF for a $4.8 billion loan to help it out of a crisis that has depleted its foreign currency reserves. The government said on Wednesday the process was on track and its request would go to the IMF board as expected.

The board is due to review the facility on December 19.

(Additional reporting by Tom Perry, Tamim Elyan and Edmund Blair; Writing by Alistair Lyon; Editing by Mark Heinrich)

Read More..