France and Germany will this week try and persuade Poland to support the EU's new treaty amid reports that Warsaw is not happy with the latest draft.

Poland's president Lech Kaczynski is to meet his French counterpart Nicolas Sarkozy in Paris today (8 October) and German chancellor Angela Merkel at the end of the week in Berlin.

The move comes after Warsaw let it be known that it is dissatisfied with the treaty compromise which does not take on board one of Poland's key demands.

A senior Polish diplomat told the International Herald Tribune newspaper: "We are not happy with the current text, because elements we wanted are not in there."

Authorities in Italy are investigating a mafia clan accused of trafficking nuclear waste and trying to make plutonium.

The 'Ndrangheta mafia, which gained notoriety in August for its blood feud killings of six men in Germany, is alleged to have made illegal shipments of radioactive waste to Somalia, as well as seeking the "clandestine production" of other nuclear material.

Two of the Calabrian clan's members are being investigated, along with eight former employees of the state energy research agency Enea.

EUOBSERVER / TÓRSHAVN - The Faroe Islands are seeking a stronger and more structured relationship with the European Union and membership of the European Free Trade Association (EFTA).

"We would like a closer co-operation with the EU - a more structured relationship similar to the one Switzerland has with the EU," said Herluf Sigvaldsson, director of the Faroese government's foreign affairs department.

He told EUobserver that the Faroese government is having informal talks with the EFTA member states - Iceland, Liechtenstein, Norway and Switzerland.

Although the talks are only in the initial stages and are expected to take a long time, "the strategy is membership", according to Mr Sigvaldsson.

The EU treaty is "substantially equivalent" to the EU Constitution thrown out by Dutch and French voters in 2005, MPs have said.

The European scrutiny committee said it should be "made clear" the UK can keep opt-outs of parts of the document.

The Conservatives said the government was now "morally bound" to hold a referendum on the treaty, as had been promised on the Constitution.

But ministers say the two documents are "substantially" different.

The treaty incorporates some of the old EU Constitution, on which Labour had promised a referendum before it was scuppered by the Dutch and French votes.

The Conservatives argue it is as much as 90% the same.

PARIS: While President Nicolas Sarkozy would like to take the lead on preventing Iran from getting the nuclear bomb, some of France's neighbors and many of its own companies are skeptical of his initiative to impose tougher European sanctions outside a United Nations mandate.

Sarkozy travels to Moscow on Tuesday to meet with President Vladimir Putin and France will present its sanctions proposals to EU colleagues next Monday. But neighbors and businesses warn that Asian - notably Chinese - companies will simply step in and pick up the slack, hurting European business interests rather than Iran.

They also argue that forgoing an early foothold in Iranian gas reserves, the world's second-largest, could compromise European energy security by increasing dependence on Russia - which threatened again last week to turn off the gas spigot on the main pipeline to Western Europe.

The skeptical countries include those with old and new economic relations with Tehran - Italy, Germany and Austria - and French companies with current and future investment plans in Iran, like Total and Renault.

An interview with the head of the European Commission, Jose Manuel Barroso, set sparks flying in Germany after he criticized Berlin's EU policy and overall attitude to Europe in what some called an election ploy.

Barroso's comments were a "provocation" which "amazed" diplomats in Brussels, Germany's Süddeutsche Zeitung (SZ) wrote in its Monday edition.

 

On Saturday, Belgian newspaper De Standaard published a wide- ranging interview with Barroso in which the head of the European Union's executive arm first said he "got along well" with German Chancellor Angela Merkel, and then accused Germany of "contradictory" behavior towards the EU.

 

Germany "pulled Europe out of the crisis over the Reform Treaty, so it has no need to catch up" with the rest of the union, European parliamentarian Elmar Brok told the Frankfurter Allgemeine Sonntagszeitung (FAS) in an implicit rejection of Barroso's comments.

French Foreign Minister Bernard Kouchner discusses Franco-German tensions, the controversy over Iran's nuclear program and his relationship with President Sarkozy.

French Foreign Minister, Bernard Kouchner (left) and French President Nicolas Sarkozy: "He gives me all kinds of latitude to act and do as I see fit." SPIEGEL: Mr. Minister, is our impression correct that there is trouble in Franco-German relations -- despite kisses on the cheek between President Nicolas Sarkozy and Chancellor Angela Merkel?

Kouchner: I don't believe that there is trouble. Friends don't have to agree on all issues. For example, we are indeed of different opinions when it comes to nuclear power, but that's normal. We agree on all fundamental issues.

SPIEGEL: And yet officials in Berlin complain that their friends in Paris are claiming every diplomatic success as their own. One example is the release of the five Bulgarian nurses from a Libyan prison. Is it only the style of French foreign policy that has changed, or is it also its substance?

Kouchner: Yes, there is a new style. During the campaign, Sarkozy promised to do what he could for the imprisoned Bulgarians. Everything happened very quickly in the end, which may have seemed abrupt. Of course, (German Foreign Minister) Frank-Walter Steinmeier and (European Commissioner for External Relations) Benita Ferrero-Waldner made important contributions. But Sarkozy and Libyan leader Moammar Gadhafi settled the matter in one decisive evening.

Ukraine has settled a commercial dispute with Russian gas firm Gazprom, averting the risk of having its most important supply of energy cut off.

The Russian firm had threatened to stop supplying its neighbour unless a $1.3bn (£650m) bill was paid this month.

But the two parties said they had reached a solution and would conclude an official agreement on Tuesday.

Previous disputes between the two have seen gas supplies to Ukraine stopped, with a knock-on effect across Europe.

European nations are to draw up radical proposals to improve transparency in financial markets and to change the way credit rating agencies operate in an attempt to prevent any recurrence of the financial turmoil arising from the credit squeeze.

A roadmap of reforms was being drawn up by eurozone finance ministers last night including fuller public disclosure of activities involving special investment vehicles set up by banks.

The finance ministers, meeting on Sunday night in Luxembourg, were poised to call for a close examination of the role of credit rating agencies, especially in relation to structured finance instruments, conflicts of interest, transparency of rating methods and delays in reassessing ratings.

The drive comes as some members of the Group of Seven leading nations prepare to launch joint action to avoid future market turmoil at their autumn meeting this month.

Gordon Brown was embroiled in another row about "spin" last night after telling MPs he may pull all of Britain's troops out of Iraq before he calls an election.

The Prime Minister said he was planning to reduce the total number of troops from 5,500 to 2,500 by next spring and held out the possibility of a total pull-out of British troops by the end of 2008. That would enable him to fight the next general election - now expected to be held in 2009 - with no troops in Iraq, neutralising the damage done to the Government by Tony Blair's decision to go to war.

He said the decision about more troop withdrawals would be taken in spring next year as Britain switched to an "over-watch" role with Iraqi forces, and it would depend on the advice of the military chiefs. But his claims were greeted with scepticism.

Mr Brown was accused of cynical media manipulation last week when he used a trip to Basra during the Conservative Party conference to imply that 1,000 British troops would be brought home by Christmas after the transfer of more tasks to Iraqi forces. It later emerged that the total included the withdrawal of 500 troops which had been previously announced.

Gordon Brown has accepted full responsibility for the fiasco over his decision not to call a general election next month but admitted that he should have announced it earlier.

The Prime Minister refused to join a "blame game" taking place in Labour circles over who advised him to go for a snap election before he finally decided against one on Saturday. But he denied scrapping well-advanced plans for a1 November election because the Conservatives had recovered in the opinion polls during their party conference last week.

An uncomfortable Mr Brown faced questions for more than 65 minutes at a Downing Street press conference - the most hostile he has faced since becoming Prime Minister in June. Several journalists expressed doubts about his claim that he was not scared off from calling an election by the turnaround in the polls.

Later, Mr Brown clashed with the Tory leader in the Commons when David Cameron accused him of "spinning" the number of British troops to be withdrawn from Iraq during a visit to the country last week, saying this was "not an acceptable way for a Prime Minister to behave". Mr Brown was jeered by Tory MPs over his decision not to call an election, while they cheered Mr Cameron for scuppering an election few of them wanted.

Mounting concern over the euro's strength against the dollar failed to translate into a common European strategy Monday, as finance ministers disagreed over how much to press Washington before a meeting of the Group of 7 industrialized countries next week.

French calls for central bank intervention to cut the costs borne by European exports failed to sway Germany's finance minister, Peer Steinbrück, who insisted publicly Monday that he loved "a strong euro."

But before a meeting of finance ministers from the 13 countries that use the euro, Pedro Solbes of Spain underlined concerns about recent volatility that are shared across much of southern Europe. After saying that exchange rates should reflect economic fundamentals, he insisted that efforts to correct the euro-dollar relationship should "not only be made by the Europeans, but by all the parties concerned," according to news agencies.

MADRID: For more than three decades, King Juan Carlos of Spain has enjoyed the unquestioning loyalty of his subjects and the discreet respect of the media. But the era of deference during which the royal family's jet-set lifestyle and personal affairs were free of public scrutiny could be drawing to a close.

A series of protests by Catalan nationalists and calls from a conservative commentator for the king to abdicate have broken a longstanding taboo and prompted debate about the role of the monarchy and the privileges and uncommon reverence enjoyed by the royal family.

Juan Carlos took the unprecedented step last week of defending the constitutional monarchy, saying it had helped guarantee "the longest period of stability and prosperity that Spain has ever experienced under democratic rule."

The king's role in helping restore democracy in Spain after the dictatorship of Franco won him the enduring gratitude and respect of a majority of Spaniards.

Turkey's prime minister, Recep Tayyip Erdogan, came under intense pressure last night to order an invasion of northern Iraq following the deadliest attacks for over a decade on the Turkish military and civilians by separatist Kurdish guerrillas.

Mr Erdogan, who has resisted demands from the Turkish armed forces for the past six months for a green light to cross the border into Iraqi Kurdistan, where the guerrillas are based, called an emergency meeting of national security chiefs to ponder their options in the crisis, a session that some said was tantamount to a war council.

Talks aimed at ending strike action by postal workers have broken down.

A second 48-hour strike over pay, pensions and job cuts began early on Monday morning with up to 130,000 staff staying away from work.

The Communications Workers Union said a further week of "continuous disruption" to all services would begin next Monday if the dispute was not resolved.

Both Royal Mail and the union expressed disappointment that an eighth day of talks failed to resolve the dispute.

A senior Israeli cabinet minister said yesterday that Israel may be willing to divide Jerusalem with the Palestinians as part of a future peace agreement.

Haim Ramon said Jewish districts of Jerusalem should remain Israeli while Arab areas could be transferred to the Palestinian Authority. "Wouldn't it be the right deal today for the Palestinians, the western world and the international community to recognise [Israel's] annexation of .... [Jewish] neighbourhoods as part of Jerusalem, and for us to quit the Arab neighbourhoods?" he told Israel Radio.

Israeli and Palestinian leaders are expected to meet at a peace conference next month in Annapolis, Maryland, but a peace deal is not believed to be close.

Mr Ramon, the vice-prime minister, said decisions over the sovereignty of holy sites of Jerusalem such as the Church of the Holy Sepulchre, the Haram al-Sharif and the Western Wall would be more complicated. "We need to say there will be a special regime in the 'holy basin', which we will talk about in the future," he said.

Renewed American efforts to persuade the Afghan government to use crop dusters against poppy production have failed, despite Washington dispatching a top scientist to advocate the safety of spraying herbicides.

Charles Helling met representatives of the Afghan ministries of counter-narcotics, health, and rural rehabilitation on Sunday to discuss fears over the side effects of glyphosate, one of the most effective methods for the mass eradication of opium poppies. Kabul, however, remained unconvinced.

"We have rejected the spraying of poppy in Afghanistan for good reasons: the effect on the environment, other smaller crops and on human genetics," the acting minister for counter-narcotics, General Khodaidad (who uses only one name), told the Guardian. "It was a very friendly discussion, but it is difficult to change our mind," he added.

The US maintains that the herbicide is safe for the environment and the local population. It says the misgivings of the Afghan president, Hamid Karzai, are based on myth and Taliban disinformation.

HAMMERFEST, Norway: For a quarter-century, energy executives were tantalized by vast quantities of natural gas in one of the world's most inhospitable places - off Norway's northern coast, beneath the Arctic Ocean.

Bitter winds and fierce snowstorms lash the region, located 90 miles, or 145 kilometers, from the country's shoreline.

The sun disappears for two months a year. No oil company knew how to operate in such a harsh environment.

But Norway has finally solved the problem. The other day, on an island just offshore, a giant yellow flame illuminated the sky here. It was just a temporary flare for excess gas, but it signaled a new era in energy production.

Across the bay from this small fishing village, where reindeer wander the streets, one of the world's most advanced natural gas plants is coming to life. Within weeks, natural gas will start crossing the ocean in specially designed ships, feeding into the pipeline network for the eastern coast of the United States. Before Christmas, furnaces in New York and stoves in Washington will be burning the fuel. It will be the first commercial energy production from waters north of the Arctic Circle.

Seven South American countries will create a new development bank.

Following a meeting in Brazil, finance ministers said the Bank of the South would play a "central role in the new financial architecture of the region".

The bank will have its headquarters in Venezuela, the country that originated the idea.

The idea for this bank was first put forward by Venezuela's socialist President Hugo Chavez, who is keen to reduce US influence in the region.

President Chavez also wants to provide an alternative to lending organisations such as the World Bank and the International Monetary Fund, which he sees as biased, capitalist and imperialist.

Washington Post - Leak Severed a Link to Al-Qaeda's Secrets
^{Firm Says Administration's Handling of Video Ruined Its Spying Efforts}
By Joby Warrick

A small private intelligence company that monitors Islamic terrorist groups obtained a new Osama bin Laden video ahead of its official release last month, and around 10 a.m. on Sept. 7, it notified the Bush administration of its secret acquisition. It gave two senior officials access on the condition that the officials not reveal they had it until the al-Qaeda release.

Within 20 minutes, a range of intelligence agencies had begun downloading it from the company's Web site. By midafternoon that day, the video and a transcript of its audio track had been leaked from within the Bush administration to cable television news and broadcast worldwide.

The founder of the company, the SITE Intelligence Group, says this premature disclosure tipped al-Qaeda to a security breach and destroyed a years-long surveillance operation that the company has used to intercept and pass along secret messages, videos and advance warnings of suicide bombings from the terrorist group's communications network.

"Techniques that took years to develop are now ineffective and worthless," said Rita Katz, the firm's 44-year-old founder, who has garnered wide attention by publicizing statements and videos from extremist chat rooms and Web sites, while attracting controversy over the secrecy of SITE's methodology. Her firm provides intelligence about terrorist groups to a wide range of paying clients, including private firms and military and intelligence agencies from the United States and several other countries.

Today there was a meeting and some Congress allies played role of mediator, urging government to press the brakes on negotiations with IAEI about India-specific safeguards which are required. But the pause means that deal will not be approved by US Congress till the end of this year, and Communists are already announced their victory.

Of course government did not utter a word on this but all understand, it's just a matter of time.

I think Congress after yesterday's failed last attempt to persuade Comrades to proceed with safeguards resigned on the deal - they cannot go on in case if Communists withdraw support as they previously thought. Government was left with unsavoury choice of falling apart with Leftists and no deal or quiet burial of deal and saving government.

It seems Sonia Gandhi preferred the latter but it remains to be seen what will be next for PM Manmohan Singh who had staked his political career on the deal. Now he will have no moral authority to continue in office and likely he will be replaced.

The genetics research that won Mario Capecchi a share of this year's Nobel Prize for medicine may well help to define the science of the 21st century. But the man himself was marked, in extraordinary ways, by the turbulent history of the century before.

Mr Capecchi's grandfather, a German archaeologist, was accidentally gunned down by his own men during the First World War. His father, an Italian aviator, perished in the Second World War. He himself spent that war destitute in northern Italy after his American mother was arrested and sent to the Dachau concentration camp - a survival tale all the more remarkable for the fact that he was just four years old when his mother was taken away.

One might imagine, after a start like that, that he would develop into an artist wrestling with his demons - one thinks of Roman Polanski, who survived the Warsaw Ghetto - or a political campaigner. Indeed, Mr Capecchi first intended to study political science when, at length, he got around to a university education.

Instead, though, he came to embody the very best of the can-do spirit of that defining 20th century nation, the United States, and, with his quiet manner and rigorously methodical mind, rose to the top of his chosen field in the medical sciences.

Yesterday's prize recognises work which could have enormous implications for medicine. Mr Capecchi, of the University of Utah in Salt Lake City, shares the £755,000 award with another naturalised American, British-born Oliver Smithies, of the University of North Carolina at Chapel Hill, and a Briton, Sir Martin Evans, of Cardiff University.

A British scientist whose pioneering research led to the creation of legions of "knockout" mice that are genetically modified to develop human diseases was awarded a Nobel prize yesterday.

Sir Martin Evans, a professor of mammalian genetics at Cardiff University, became the first scientist to isolate stem cells from mouse embryos in 1981. The research paved the way for a technique called gene targeting, which allows scientists to alter the genetic code of an animal with exquisite precision.

By knocking out specific genes, researchers have designed mice that develop a range of medical conditions including cancer, cystic fibrosis and atherosclerosis, or hardening of the arteries.

The modified mice give researchers unprecedented insight into how some of the most debilitating human diseases progress in different tissues and organs over a lifetime, and have proved invaluable in testing new drug therapies. More than 500 different diseases have been recreated in mice using the technique.

Professor Evans, 66, was awarded the Nobel in physiology or medicine, sharing the kudos - and accompanying 10m Swedish kronor (£755,000) - with two other scientists, the Yorkshire-born Oliver Smithies, 80, now an American citizen at the University of North Carolina, and Mario Capecchi, 70, an Italian researcher based at the University of Utah. The award was announced by the Nobel committee in Stockholm yesterday.

Sixty thousand people converged in Hanover over the weekend to celebrate the 60th birthday of the Volkswagen Bus. On view were over 5,000 examples of the vehicle that would change the way people used -- and experienced -- the road.

It has been the preferred vehicle for postal workers, policemen, camping enthusiasts and, of course, members of the "Flower Power" generation. Over the weekend, 60,000 people came to Hanover for a three-day festival saluting 60 years of the vehicle that revolutionized the world.

A Japanese teenager has won the Rubik's Cube World Championships in Hungary's capital, Budapest, taking less than 13 seconds to finish the cult '80s puzzle.

Yu Nakajima, 16, took home 5,000 euros (£3,400, $7,000) after winning the main event of the three-day tournament.

Nearly 300 contenders from 33 countries tried their hands - and feet - at the puzzle, some completing it blindfolded.

Hungarian architect Erno Rubik invented the cube in Hungary in 1974. More than 300 million cubes have been sold since.

Hong Kong choking in dense smog

Hong Kong's air pollution reached dangerous levels on Monday, reigniting concerns about public health and fears that the city could lose out on crucial foreign investment due to the thick smog.

Across the southern Chinese territory, the Air Pollution Index on Monday passed the critical 100 mark, the point at which the Environmental Protection Department warns anyone with respiratory or heart problems to stay home.

At the weekend, the index reached 144. The high on Monday was 113.

The poor air quality -- which left the city's Victoria Harbour shrouded in haze -- was recorded even though many factories in the neighbouring Pearl River Delta in mainland China have been closed for a week-long holiday.

More than a dozen Hong Kong pensioners were hospitalised on Saturday alone for breathing ailments, prompting local aid charities to cry foul.

Some optimists are designing Hong Kong jungle like this:

Plans for an eco-village of nine small holdings built from scratch on grazing land in rural Pembrokeshire are being recommended for refusal by officials.

Lammas, the group behind the bid, said if approved, the community would be a model of low-impact green development.

The village at Glandwr near the Preseli mountains would be built from natural materials such as turf, wood and straw.

But 90 people have objected to the plan and planning officers say the application should be turned down.

It was the first to be submitted under the council's new "low impact development" policy this year.

A Milan prosecutor has laid a new charge of false accounting against ex-Prime Minister Silvio Berlusconi.

Monday's charge opened a new phase in the long-running battle between the Italian judiciary and Mr Berlusconi.

It prevents the statute of limitations from expiring in a trial over the purchase by Mr Berlusconi's Mediaset empire of rights to films.

Mr Berlusconi's lawyer says his client was not involved in company business at the time of the alleged fraud.