UNITED NATIONS (AFP) – Investigators have evidence that Libyan leader Moamer Kadhafi ordered mass rapes and bought containers of sex drugs to encourage troops to attack women, the chief ICC prosecutor said Wednesday.
Luis Moreno-Ocampo said he may ask for a new charge of mass rape to be made against Kadhafi following the new evidence.
The International Criminal Court's chief prosecutor is expecting a decision from judges within days on his request for charges of crimes against humanity to be laid against the Libyan leader, one of his sons and his intelligence chief.
"Now we are getting some information that Kadhafi himself decided to rape and this is new," Moreno-Ocampo told reporters.
He said there were reports of hundreds of women attacked in some areas of Libya, which is in the grip of a months-long internal rebellion.
There was evidence the Libyan authorities bought "Viagra-type" medicines and gave them to troops as part of the official rape policy, Moreno-Ocampo said.
"They were buying containers to enhance the possibility to rape women," he said.
"It was never the pattern he used to control the population. The rape is a new aspect of the repression. That is why we had doubts at the beginning, but now we are more convinced that he decided to punish using rape," the prosecutor said.
"It was very bad -- beyond the limits, I would say."
Kadhafi's regime had not previously been known for using rape as a weapon against political opponents and Moreno-Ocampo said he had to find evidence that the Libyan leader had given the order.
In March, a Libyan woman made international headlines when she entered a Tripoli hotel and said she had been raped by Kadhafi troops.
Iman al-Obeidi was detained but managed to escape from Libya. She ended up in Qatar but was deported back from there to rebel-held Libya. She is now resting at a refugee centre in Romania.
Moreno-Ocampo issued arrest warrants last month against Kadhafi, his son Seif al-Islam and intelligence chief Abdullah al-Sanussi. ICC judges are to announce in days whether they agree to the charges.
The Libyan government does not recognize the international court's jurisdiction.
Thursday, June 9, 2011
Wednesday, June 8, 2011
Qaeda's Zawahri says U.S. facing Muslim rebellion
CAIRO (Reuters) – Al-Qaeda's second-in-command Ayman al-Zawahri said the United States faced a Muslim rebellion following the death of Osama bin Laden, according to a video recording posted on YouTube and monitored on Wednesday.
The Egyptian-born Zawahri devoted much of his 28-minute recording to mourning bin Laden, who was killed in a raid by U.S. special forces on his home in Pakistan in May after a nearly 10-year worldwide hunt.
"The sheikh has departed, may God have mercy on him, to his God as a martyr and we must continue on his path of jihad to expel the invaders from the land of Muslims and to purify it from injustice," Zawahri said.
"Today, and thanks be to God, America is not facing an individual or a group ... but a rebelling nation which has awoken from its sleep in a jihadist renaissance."
Zawahri has long been seen as the brains and potential successor to bin Laden, founder of al Qaeda, which carried out the September 11, 2001 attacks on the United States.
But Al Jazeera television has said that another Egyptian militant called Saif al-Adl has been named as temporary leader of the group following bin Laden's death.
The Egyptian-born Zawahri devoted much of his 28-minute recording to mourning bin Laden, who was killed in a raid by U.S. special forces on his home in Pakistan in May after a nearly 10-year worldwide hunt.
"The sheikh has departed, may God have mercy on him, to his God as a martyr and we must continue on his path of jihad to expel the invaders from the land of Muslims and to purify it from injustice," Zawahri said.
"Today, and thanks be to God, America is not facing an individual or a group ... but a rebelling nation which has awoken from its sleep in a jihadist renaissance."
Zawahri has long been seen as the brains and potential successor to bin Laden, founder of al Qaeda, which carried out the September 11, 2001 attacks on the United States.
But Al Jazeera television has said that another Egyptian militant called Saif al-Adl has been named as temporary leader of the group following bin Laden's death.
Syrians flee town as troops approach
BEIRUT (Reuters) – Turkey called on Syria on Wednesday to rein in violence against civilians and promised not to turn away refugees as some residents of a Syrian border town headed for the Turkish frontier in fear of a military assault.
"Syria should change its attitude toward civilians and should take its attitude to a more tolerant level as soon as possible," said Turkish Prime Minister Tayyip Erdogan, who has had warm relations with Syrian President Bashar al-Assad.
Assad's government has accused armed bands of killing scores of its security men in Jisr al-Shughour and has vowed to send in the army to carry out their "national duty to restore security."
Accounts of the violence that began in the hilly town of Jisr al-Shughour Friday vary, with officials saying gunmen ambushed troops and residents reporting an army mutiny.
The bloodshed has triggered international alarm that Syria may be entering an even more violent phase after three months of popular unrest that has cost more than 1,000 lives.
France and Britain, allies in the war against Libyan leader Muammar Gaddafi, will put forward a U.N. Security Council resolution Wednesday condemning Assad's crackdown on protesters, British Prime Minister David Cameron said.
"And if anyone votes against that resolution or tries to veto it, that should be on their conscience," Cameron said.
The draft resolution condemns the repression and demands humanitarian access, Cameron said in London. But it was unclear how Russia, which holds a veto, would vote. Citing NATO's inconclusive bombing of Tripoli, Moscow says it will not back intervention against Syria in the Security Council.
French Foreign Minister Alain Juppe, at U.N. headquarters in New York, said it was "a question of days, maybe hours" before the Council voted on a resolution condemning Syria. A draft circulated last month does not propose military intervention.
At Jisr al-Shughour, home to tens of thousands of people, residents said they were taking cover and bracing for attacks. Some 120 men, women and children fled into Turkey overnight to seek refuge, the Anatolian news agency said.
Erdogan, who has distanced himself from Assad since the Syrian uprising began, said Turkey would not "close its doors" to refugees fleeing Syria.
Rami Abdulrahman of the Syrian Observatory for Human Rights said troops had deployed in villages around Jisr al-Shughour, including Ariha to the east and on the main Latakia highway to the southwest.
Residents said about 40 tanks and armored vehicles were about 7 km (4 miles) from Jisr al-Shughour, which was now mostly empty, save for youth protesters.
Ali Haj Abrahim said his son Bilal, who had volunteered to help the wounded at the weekend, was shot by security forces on Sunday on the outskirts of Jisr al-Shoughour.
"Two machinegun rounds tore through his chest and his left shoulder. He was 26 with a geography degree, married four months ago. His wife is pregnant," Haj Ibrahim said.
"We are not taking condolences. We consider his martyrdom a wedding for the defense of freedom," he told Reuters.
Abdulrahman said there were protests against Assad on Tuesday in suburbs of Damascus, including Harasta and Douma, and in Deir Al-Zor and Qamishli in the northeast. Pro-Assad rallies were also held in some of the capital's suburbs.
The government has expelled independent journalists, making it hard to determine clearly what is happening in the country.
Despite enthusiasm for pro-democracy movements that have unseated presidents in Tunisia and Egypt, few Western leaders -- let alone their autocratic Arab partners -- have shown a willingness to intervene in Syria, an Iranian ally whose volatile mix of ethnic and religious groups sits astride a web of regional conflicts.
FOREIGN PRESSURE
Assad's family and supporters from the minority Alawite sect have dominated Syria since his late father seized power 41 years ago. He has responded with promises of reform, and a crackdown on protesters in towns across the country. His officials accuse radical Islamists of fomenting a violent, armed revolt.
Neighboring countries, including Israel and Turkey, worry that a collapse into chaos in Syria could set off sectarian conflict and the emergence of violent, radical Islamists, as happened in neighboring Iraq after the U.S. invasion of 2003.
But Western powers are keeping up the pressure on Assad, with U.S. President Barack Obama urging him to lead a transition to democracy or "get out of the way."
British Foreign Secretary William Hague, in some of London's strongest language yet against the 45-year-old leader, on Tuesday told parliament: "President Assad is losing legitimacy and should reform or step aside." He said European governments were looking at further sanctions.
Russia appears opposed to a general condemnation of Assad, let alone authorizing military action against him.
"The prospect of a U.N. Security Council resolution that's along the same lines as Resolution 1973 on Libya will not be supported by my country ... The use of force, as Libya shows, does not provide answers," said Russia's envoy to the European Union, Vladimir Chizhov.
Syria's ambassador to France Lamia Chakkour denied a report Tuesday that she had resigned in protest at the government's repression of protests, saying it was part of a campaign of disinformation against Damascus
"Syria should change its attitude toward civilians and should take its attitude to a more tolerant level as soon as possible," said Turkish Prime Minister Tayyip Erdogan, who has had warm relations with Syrian President Bashar al-Assad.
Assad's government has accused armed bands of killing scores of its security men in Jisr al-Shughour and has vowed to send in the army to carry out their "national duty to restore security."
Accounts of the violence that began in the hilly town of Jisr al-Shughour Friday vary, with officials saying gunmen ambushed troops and residents reporting an army mutiny.
The bloodshed has triggered international alarm that Syria may be entering an even more violent phase after three months of popular unrest that has cost more than 1,000 lives.
France and Britain, allies in the war against Libyan leader Muammar Gaddafi, will put forward a U.N. Security Council resolution Wednesday condemning Assad's crackdown on protesters, British Prime Minister David Cameron said.
"And if anyone votes against that resolution or tries to veto it, that should be on their conscience," Cameron said.
The draft resolution condemns the repression and demands humanitarian access, Cameron said in London. But it was unclear how Russia, which holds a veto, would vote. Citing NATO's inconclusive bombing of Tripoli, Moscow says it will not back intervention against Syria in the Security Council.
French Foreign Minister Alain Juppe, at U.N. headquarters in New York, said it was "a question of days, maybe hours" before the Council voted on a resolution condemning Syria. A draft circulated last month does not propose military intervention.
At Jisr al-Shughour, home to tens of thousands of people, residents said they were taking cover and bracing for attacks. Some 120 men, women and children fled into Turkey overnight to seek refuge, the Anatolian news agency said.
Erdogan, who has distanced himself from Assad since the Syrian uprising began, said Turkey would not "close its doors" to refugees fleeing Syria.
Rami Abdulrahman of the Syrian Observatory for Human Rights said troops had deployed in villages around Jisr al-Shughour, including Ariha to the east and on the main Latakia highway to the southwest.
Residents said about 40 tanks and armored vehicles were about 7 km (4 miles) from Jisr al-Shughour, which was now mostly empty, save for youth protesters.
Ali Haj Abrahim said his son Bilal, who had volunteered to help the wounded at the weekend, was shot by security forces on Sunday on the outskirts of Jisr al-Shoughour.
"Two machinegun rounds tore through his chest and his left shoulder. He was 26 with a geography degree, married four months ago. His wife is pregnant," Haj Ibrahim said.
"We are not taking condolences. We consider his martyrdom a wedding for the defense of freedom," he told Reuters.
Abdulrahman said there were protests against Assad on Tuesday in suburbs of Damascus, including Harasta and Douma, and in Deir Al-Zor and Qamishli in the northeast. Pro-Assad rallies were also held in some of the capital's suburbs.
The government has expelled independent journalists, making it hard to determine clearly what is happening in the country.
Despite enthusiasm for pro-democracy movements that have unseated presidents in Tunisia and Egypt, few Western leaders -- let alone their autocratic Arab partners -- have shown a willingness to intervene in Syria, an Iranian ally whose volatile mix of ethnic and religious groups sits astride a web of regional conflicts.
FOREIGN PRESSURE
Assad's family and supporters from the minority Alawite sect have dominated Syria since his late father seized power 41 years ago. He has responded with promises of reform, and a crackdown on protesters in towns across the country. His officials accuse radical Islamists of fomenting a violent, armed revolt.
Neighboring countries, including Israel and Turkey, worry that a collapse into chaos in Syria could set off sectarian conflict and the emergence of violent, radical Islamists, as happened in neighboring Iraq after the U.S. invasion of 2003.
But Western powers are keeping up the pressure on Assad, with U.S. President Barack Obama urging him to lead a transition to democracy or "get out of the way."
British Foreign Secretary William Hague, in some of London's strongest language yet against the 45-year-old leader, on Tuesday told parliament: "President Assad is losing legitimacy and should reform or step aside." He said European governments were looking at further sanctions.
Russia appears opposed to a general condemnation of Assad, let alone authorizing military action against him.
"The prospect of a U.N. Security Council resolution that's along the same lines as Resolution 1973 on Libya will not be supported by my country ... The use of force, as Libya shows, does not provide answers," said Russia's envoy to the European Union, Vladimir Chizhov.
Syria's ambassador to France Lamia Chakkour denied a report Tuesday that she had resigned in protest at the government's repression of protests, saying it was part of a campaign of disinformation against Damascus
Syrians flee town as troops approach
BEIRUT (Reuters) – Turkey called on Syria on Wednesday to rein in violence against civilians and promised not to turn away refugees as some residents of a Syrian border town headed for the Turkish frontier in fear of a military assault.
"Syria should change its attitude toward civilians and should take its attitude to a more tolerant level as soon as possible," said Turkish Prime Minister Tayyip Erdogan, who has had warm relations with Syrian President Bashar al-Assad.
Assad's government has accused armed bands of killing scores of its security men in Jisr al-Shughour and has vowed to send in the army to carry out their "national duty to restore security."
Accounts of the violence that began in the hilly town of Jisr al-Shughour Friday vary, with officials saying gunmen ambushed troops and residents reporting an army mutiny.
The bloodshed has triggered international alarm that Syria may be entering an even more violent phase after three months of popular unrest that has cost more than 1,000 lives.
France and Britain, allies in the war against Libyan leader Muammar Gaddafi, will put forward a U.N. Security Council resolution Wednesday condemning Assad's crackdown on protesters, British Prime Minister David Cameron said.
"And if anyone votes against that resolution or tries to veto it, that should be on their conscience," Cameron said.
The draft resolution condemns the repression and demands humanitarian access, Cameron said in London. But it was unclear how Russia, which holds a veto, would vote. Citing NATO's inconclusive bombing of Tripoli, Moscow says it will not back intervention against Syria in the Security Council.
French Foreign Minister Alain Juppe, at U.N. headquarters in New York, said it was "a question of days, maybe hours" before the Council voted on a resolution condemning Syria. A draft circulated last month does not propose military intervention.
At Jisr al-Shughour, home to tens of thousands of people, residents said they were taking cover and bracing for attacks. Some 120 men, women and children fled into Turkey overnight to seek refuge, the Anatolian news agency said.
Erdogan, who has distanced himself from Assad since the Syrian uprising began, said Turkey would not "close its doors" to refugees fleeing Syria.
Rami Abdulrahman of the Syrian Observatory for Human Rights said troops had deployed in villages around Jisr al-Shughour, including Ariha to the east and on the main Latakia highway to the southwest.
Residents said about 40 tanks and armored vehicles were about 7 km (4 miles) from Jisr al-Shughour, which was now mostly empty, save for youth protesters.
Ali Haj Abrahim said his son Bilal, who had volunteered to help the wounded at the weekend, was shot by security forces on Sunday on the outskirts of Jisr al-Shoughour.
"Two machinegun rounds tore through his chest and his left shoulder. He was 26 with a geography degree, married four months ago. His wife is pregnant," Haj Ibrahim said.
"We are not taking condolences. We consider his martyrdom a wedding for the defense of freedom," he told Reuters.
Abdulrahman said there were protests against Assad on Tuesday in suburbs of Damascus, including Harasta and Douma, and in Deir Al-Zor and Qamishli in the northeast. Pro-Assad rallies were also held in some of the capital's suburbs.
The government has expelled independent journalists, making it hard to determine clearly what is happening in the country.
Despite enthusiasm for pro-democracy movements that have unseated presidents in Tunisia and Egypt, few Western leaders -- let alone their autocratic Arab partners -- have shown a willingness to intervene in Syria, an Iranian ally whose volatile mix of ethnic and religious groups sits astride a web of regional conflicts.
FOREIGN PRESSURE
Assad's family and supporters from the minority Alawite sect have dominated Syria since his late father seized power 41 years ago. He has responded with promises of reform, and a crackdown on protesters in towns across the country. His officials accuse radical Islamists of fomenting a violent, armed revolt.
Neighboring countries, including Israel and Turkey, worry that a collapse into chaos in Syria could set off sectarian conflict and the emergence of violent, radical Islamists, as happened in neighboring Iraq after the U.S. invasion of 2003.
But Western powers are keeping up the pressure on Assad, with U.S. President Barack Obama urging him to lead a transition to democracy or "get out of the way."
British Foreign Secretary William Hague, in some of London's strongest language yet against the 45-year-old leader, on Tuesday told parliament: "President Assad is losing legitimacy and should reform or step aside." He said European governments were looking at further sanctions.
Russia appears opposed to a general condemnation of Assad, let alone authorizing military action against him.
"The prospect of a U.N. Security Council resolution that's along the same lines as Resolution 1973 on Libya will not be supported by my country ... The use of force, as Libya shows, does not provide answers," said Russia's envoy to the European Union, Vladimir Chizhov.
Syria's ambassador to France Lamia Chakkour denied a report Tuesday that she had resigned in protest at the government's repression of protests, saying it was part of a campaign of disinformation against Damascus.
"Syria should change its attitude toward civilians and should take its attitude to a more tolerant level as soon as possible," said Turkish Prime Minister Tayyip Erdogan, who has had warm relations with Syrian President Bashar al-Assad.
Assad's government has accused armed bands of killing scores of its security men in Jisr al-Shughour and has vowed to send in the army to carry out their "national duty to restore security."
Accounts of the violence that began in the hilly town of Jisr al-Shughour Friday vary, with officials saying gunmen ambushed troops and residents reporting an army mutiny.
The bloodshed has triggered international alarm that Syria may be entering an even more violent phase after three months of popular unrest that has cost more than 1,000 lives.
France and Britain, allies in the war against Libyan leader Muammar Gaddafi, will put forward a U.N. Security Council resolution Wednesday condemning Assad's crackdown on protesters, British Prime Minister David Cameron said.
"And if anyone votes against that resolution or tries to veto it, that should be on their conscience," Cameron said.
The draft resolution condemns the repression and demands humanitarian access, Cameron said in London. But it was unclear how Russia, which holds a veto, would vote. Citing NATO's inconclusive bombing of Tripoli, Moscow says it will not back intervention against Syria in the Security Council.
French Foreign Minister Alain Juppe, at U.N. headquarters in New York, said it was "a question of days, maybe hours" before the Council voted on a resolution condemning Syria. A draft circulated last month does not propose military intervention.
At Jisr al-Shughour, home to tens of thousands of people, residents said they were taking cover and bracing for attacks. Some 120 men, women and children fled into Turkey overnight to seek refuge, the Anatolian news agency said.
Erdogan, who has distanced himself from Assad since the Syrian uprising began, said Turkey would not "close its doors" to refugees fleeing Syria.
Rami Abdulrahman of the Syrian Observatory for Human Rights said troops had deployed in villages around Jisr al-Shughour, including Ariha to the east and on the main Latakia highway to the southwest.
Residents said about 40 tanks and armored vehicles were about 7 km (4 miles) from Jisr al-Shughour, which was now mostly empty, save for youth protesters.
Ali Haj Abrahim said his son Bilal, who had volunteered to help the wounded at the weekend, was shot by security forces on Sunday on the outskirts of Jisr al-Shoughour.
"Two machinegun rounds tore through his chest and his left shoulder. He was 26 with a geography degree, married four months ago. His wife is pregnant," Haj Ibrahim said.
"We are not taking condolences. We consider his martyrdom a wedding for the defense of freedom," he told Reuters.
Abdulrahman said there were protests against Assad on Tuesday in suburbs of Damascus, including Harasta and Douma, and in Deir Al-Zor and Qamishli in the northeast. Pro-Assad rallies were also held in some of the capital's suburbs.
The government has expelled independent journalists, making it hard to determine clearly what is happening in the country.
Despite enthusiasm for pro-democracy movements that have unseated presidents in Tunisia and Egypt, few Western leaders -- let alone their autocratic Arab partners -- have shown a willingness to intervene in Syria, an Iranian ally whose volatile mix of ethnic and religious groups sits astride a web of regional conflicts.
FOREIGN PRESSURE
Assad's family and supporters from the minority Alawite sect have dominated Syria since his late father seized power 41 years ago. He has responded with promises of reform, and a crackdown on protesters in towns across the country. His officials accuse radical Islamists of fomenting a violent, armed revolt.
Neighboring countries, including Israel and Turkey, worry that a collapse into chaos in Syria could set off sectarian conflict and the emergence of violent, radical Islamists, as happened in neighboring Iraq after the U.S. invasion of 2003.
But Western powers are keeping up the pressure on Assad, with U.S. President Barack Obama urging him to lead a transition to democracy or "get out of the way."
British Foreign Secretary William Hague, in some of London's strongest language yet against the 45-year-old leader, on Tuesday told parliament: "President Assad is losing legitimacy and should reform or step aside." He said European governments were looking at further sanctions.
Russia appears opposed to a general condemnation of Assad, let alone authorizing military action against him.
"The prospect of a U.N. Security Council resolution that's along the same lines as Resolution 1973 on Libya will not be supported by my country ... The use of force, as Libya shows, does not provide answers," said Russia's envoy to the European Union, Vladimir Chizhov.
Syria's ambassador to France Lamia Chakkour denied a report Tuesday that she had resigned in protest at the government's repression of protests, saying it was part of a campaign of disinformation against Damascus.
China warns U.S. debt-default idea is "playing with fire"
SINGAPORE (Reuters) – Republican lawmakers are "playing with fire" by contemplating even a brief debt default as a means to force deeper government spending cuts, an adviser to China's central bank said on Wednesday.
The idea of a technical default -- essentially delaying interest payments for a few days -- has gained backing from a growing number of mainstream Republicans who see it as a price worth paying if it forces the White House to slash spending, Reuters reported on Tuesday.
But any form of default could destabilize the global economy and sour already tense relations with big U.S. creditors such as China, government officials and investors warn.
Li Daokui, an adviser to the People's Bank of China, said a default could undermine the U.S. dollar, and Beijing needed to dissuade Washington from pursuing this course of action.
"I think there is a risk that the U.S. debt default may happen," Li told reporters on the sidelines of a forum in Beijing. "The result will be very serious and I really hope that they would stop playing with fire."
[ For complete coverage of politics and policy, go to Yahoo! Politics ]
China is the largest foreign creditor to the United States, holding more than $1 trillion in Treasury debt as of March, U.S. data shows, so its concerns carry considerable weight in Washington.
"I really worry about the risks of a U.S. debt default, which I think may lead to a decline in the dollar's value," Li said.
Congress has balked at increasing a statutory limit on government spending as lawmakers argue over how to curb a deficit which is projected to reach $1.4 trillion this fiscal year. The U.S. Treasury Department has said it will run out of borrowing room by August 2.
If the United States cannot make interest payments on its debt, the Obama administration has warned of "catastrophic" consequences that could push the still-fragile economy back into recession.
"It has dire implications for the economy at a time when the macro data is softening," said Ben Westmore, a commodities economist at National Australia Bank.
"It's just a horrible idea," he said.
Financial markets are following the U.S. debate but see little risk of a default.
U.S. Treasury prices were firm in Europe on Wednesday, supported by a flight to their perceived safety on the back of the Greek debt crisis and worries about a slowdown in U.S. economic growth.
Marc Ostwald, a strategist with Monument Securities in London, said markets were working on the assumption that the U.S. debt story "will go away." But nervousness would grow if a resolution was not reached in the next five to six weeks.
'WOULDN'T HAPPEN'
The Republicans' theory is that bondholders would accept a brief delay in interest payments if it meant Washington finally addressed its long-term fiscal problems, putting the country in a stronger position to meet its debt obligations later on.
But interviews with government officials and investors show they consider a default such a grim -- and remote -- possibility that it was nearly impossible to imagine.
"How can the U.S. be allowed to default?" said an official at India's central bank. "We don't think this is a possibility because this could then create huge panic globally."
Indian officials say they have little choice but to buy U.S. Treasury debt because it is still among the world's safest and most liquid investments. It held $39.8 billion in U.S. Treasuries as of March, U.S. data shows.
The officials declined to be identified because they are not authorized to speak to the media.
Oman is concerned about the impact of a default on the currency reserves of the sultanate and its Gulf neighbors.
"Our economies are substantially tied up with the U.S. financial developments," said a senior central bank official, who spoke on condition of anonymity.
"It just wouldn't happen," said Barry Evans, who oversees $83 billion in fixed income assets at Manulife Asset Management. "They would pay their Treasury bills first instead of other bills. It's as simple as that."
Monument's Ostwald called the default scenario "frightening" and said bondholders' patience would wear thin if lawmakers persisted in pitching this strategy in the coming weeks.
"This isn't a debate, this is like a Mexican standoff and that is where the problem lies," he said.
Yuan Gangming, a researcher with the Chinese Academy of Social Sciences, a government think tank, smelled some political wrangling behind the U.S. debt debate as the 2012 presidential election draws nearer and said Republicans "want to make things difficult for Obama."
But with time running short before the U.S. Treasury exhausts its borrowing room, Yuan said default was a real risk.
"The possibility is quite high to see a default of the U.S. debt, which would harm many countries in the world, and China in particular," he said.
The idea of a technical default -- essentially delaying interest payments for a few days -- has gained backing from a growing number of mainstream Republicans who see it as a price worth paying if it forces the White House to slash spending, Reuters reported on Tuesday.
But any form of default could destabilize the global economy and sour already tense relations with big U.S. creditors such as China, government officials and investors warn.
Li Daokui, an adviser to the People's Bank of China, said a default could undermine the U.S. dollar, and Beijing needed to dissuade Washington from pursuing this course of action.
"I think there is a risk that the U.S. debt default may happen," Li told reporters on the sidelines of a forum in Beijing. "The result will be very serious and I really hope that they would stop playing with fire."
[ For complete coverage of politics and policy, go to Yahoo! Politics ]
China is the largest foreign creditor to the United States, holding more than $1 trillion in Treasury debt as of March, U.S. data shows, so its concerns carry considerable weight in Washington.
"I really worry about the risks of a U.S. debt default, which I think may lead to a decline in the dollar's value," Li said.
Congress has balked at increasing a statutory limit on government spending as lawmakers argue over how to curb a deficit which is projected to reach $1.4 trillion this fiscal year. The U.S. Treasury Department has said it will run out of borrowing room by August 2.
If the United States cannot make interest payments on its debt, the Obama administration has warned of "catastrophic" consequences that could push the still-fragile economy back into recession.
"It has dire implications for the economy at a time when the macro data is softening," said Ben Westmore, a commodities economist at National Australia Bank.
"It's just a horrible idea," he said.
Financial markets are following the U.S. debate but see little risk of a default.
U.S. Treasury prices were firm in Europe on Wednesday, supported by a flight to their perceived safety on the back of the Greek debt crisis and worries about a slowdown in U.S. economic growth.
Marc Ostwald, a strategist with Monument Securities in London, said markets were working on the assumption that the U.S. debt story "will go away." But nervousness would grow if a resolution was not reached in the next five to six weeks.
'WOULDN'T HAPPEN'
The Republicans' theory is that bondholders would accept a brief delay in interest payments if it meant Washington finally addressed its long-term fiscal problems, putting the country in a stronger position to meet its debt obligations later on.
But interviews with government officials and investors show they consider a default such a grim -- and remote -- possibility that it was nearly impossible to imagine.
"How can the U.S. be allowed to default?" said an official at India's central bank. "We don't think this is a possibility because this could then create huge panic globally."
Indian officials say they have little choice but to buy U.S. Treasury debt because it is still among the world's safest and most liquid investments. It held $39.8 billion in U.S. Treasuries as of March, U.S. data shows.
The officials declined to be identified because they are not authorized to speak to the media.
Oman is concerned about the impact of a default on the currency reserves of the sultanate and its Gulf neighbors.
"Our economies are substantially tied up with the U.S. financial developments," said a senior central bank official, who spoke on condition of anonymity.
"It just wouldn't happen," said Barry Evans, who oversees $83 billion in fixed income assets at Manulife Asset Management. "They would pay their Treasury bills first instead of other bills. It's as simple as that."
Monument's Ostwald called the default scenario "frightening" and said bondholders' patience would wear thin if lawmakers persisted in pitching this strategy in the coming weeks.
"This isn't a debate, this is like a Mexican standoff and that is where the problem lies," he said.
Yuan Gangming, a researcher with the Chinese Academy of Social Sciences, a government think tank, smelled some political wrangling behind the U.S. debt debate as the 2012 presidential election draws nearer and said Republicans "want to make things difficult for Obama."
But with time running short before the U.S. Treasury exhausts its borrowing room, Yuan said default was a real risk.
"The possibility is quite high to see a default of the U.S. debt, which would harm many countries in the world, and China in particular," he said.
German minister pushes 7-year Greek debt rollover
BERLIN (AFP) – Germany, facing pressure from lawmakers within its ruling coalition, has laid out its conditions for new aid for Greece: private banks must forego collecting Greek public debts for seven years.
In a letter sent to eurozone partners and made public on Wednesday, German Finance Minister Wolfgang Schaeuble said an agreement could be reached "through a bond swap leading to a prolongation of the outstanding Greek sovereign bonds by seven years."
Schaeuble has insisted for weeks that a second aid package being negotiated for Greece must include contributions by private investors, though without detailing what would be expected of them.
A rollover, or renewal of credits to Greece would allow for "a fair sharing of the burden between taxpayers and investors," finance ministry spokesman Martin Kreienbaum said Wednesday.
Chancellor Angela Merkel has just returned from the United States and was to speak with deputies from liberal and conservative parliamentary groups to calm heated passions and convince them to back more aid for Athens.
She is expected to assure the lawmakers that, as Schaeuble said in his letter, Germany will agree to nothing that did not include "a quantified and substantial contribution of bondholders to the support effort" for Greece.
Taxpayers in several European countries such as Austria, Finland, Germany, the Netherlands and Slovakia are firmly opposed to more aid for Greece, which is being crushed by some 350 billion euros ($500 billion) in debt.
While the German proviso may go some way towards appeasing them, it will probably not go down well in other parts of Europe.
The French position is "a refusal to restructure Greek debt," government spokesman Francois Baroin said Wednesday, something the German proposal could be seen as.
The European Central Bank in Frankfurt is also unlikely to appreciate Schaeuble's letter.
ECB president Jean-Claude Trichet said Monday he would only accept a voluntary gesture on the part of banks to reinvest money they earned on Greek bonds into more credit for the country.
Schaeuble's idea goes much further however by establishing a period long enough to fully implement necessary reforms and regain market confidence.
He specifically called for a commitment by holders of Greek bonds that goes beyond the approach summed up as the Vienna Initiative.
That was a model created during the global financial crisis that saw banks roll over credits to Hungary, Latvia and Romania, and has support from the European Commission and French authorities.
"Someone will have to give ground," Commerzbank analyst Christoph Rieger concluded.
He supposed that it would be Germany that would probably ease its demands at some point.
Berlin has already stressed the "voluntary" aspect to decisions by investors.
"We assume that private creditors are aware of their responsibilities," finance ministry spokesman Kreienbaum said.
Andreas Schmitz, head of the German federation of private banks, allowed that "an extension of the maturity of Greek bonds might be a solution."
Banks might not have a choice in any event, since the alternative could be getting hit with severe losses.
Schaeuble warned in his letter that "I see the need to agree on a new program for Greece in order to close the financing gap and prevent default," which could spell disaster for the 17-nation eurozone
In a letter sent to eurozone partners and made public on Wednesday, German Finance Minister Wolfgang Schaeuble said an agreement could be reached "through a bond swap leading to a prolongation of the outstanding Greek sovereign bonds by seven years."
Schaeuble has insisted for weeks that a second aid package being negotiated for Greece must include contributions by private investors, though without detailing what would be expected of them.
A rollover, or renewal of credits to Greece would allow for "a fair sharing of the burden between taxpayers and investors," finance ministry spokesman Martin Kreienbaum said Wednesday.
Chancellor Angela Merkel has just returned from the United States and was to speak with deputies from liberal and conservative parliamentary groups to calm heated passions and convince them to back more aid for Athens.
She is expected to assure the lawmakers that, as Schaeuble said in his letter, Germany will agree to nothing that did not include "a quantified and substantial contribution of bondholders to the support effort" for Greece.
Taxpayers in several European countries such as Austria, Finland, Germany, the Netherlands and Slovakia are firmly opposed to more aid for Greece, which is being crushed by some 350 billion euros ($500 billion) in debt.
While the German proviso may go some way towards appeasing them, it will probably not go down well in other parts of Europe.
The French position is "a refusal to restructure Greek debt," government spokesman Francois Baroin said Wednesday, something the German proposal could be seen as.
The European Central Bank in Frankfurt is also unlikely to appreciate Schaeuble's letter.
ECB president Jean-Claude Trichet said Monday he would only accept a voluntary gesture on the part of banks to reinvest money they earned on Greek bonds into more credit for the country.
Schaeuble's idea goes much further however by establishing a period long enough to fully implement necessary reforms and regain market confidence.
He specifically called for a commitment by holders of Greek bonds that goes beyond the approach summed up as the Vienna Initiative.
That was a model created during the global financial crisis that saw banks roll over credits to Hungary, Latvia and Romania, and has support from the European Commission and French authorities.
"Someone will have to give ground," Commerzbank analyst Christoph Rieger concluded.
He supposed that it would be Germany that would probably ease its demands at some point.
Berlin has already stressed the "voluntary" aspect to decisions by investors.
"We assume that private creditors are aware of their responsibilities," finance ministry spokesman Kreienbaum said.
Andreas Schmitz, head of the German federation of private banks, allowed that "an extension of the maturity of Greek bonds might be a solution."
Banks might not have a choice in any event, since the alternative could be getting hit with severe losses.
Schaeuble warned in his letter that "I see the need to agree on a new program for Greece in order to close the financing gap and prevent default," which could spell disaster for the 17-nation eurozone
11 die in sect attacks in Nigeria's northeast
MAIDUGURI, Nigeria – At least 11 people have been killed in multiple blasts and targeted attacks orchestrated by a feared radical Muslim sect in Nigeria's restive northeast, police said Tuesday.
Borno State police chief Mohammed Abubakar said members of the radical sect locally known as Boko Haram detonated bombs at two police stations and at St. Patrick's Church Tuesday afternoon in the city of Maiduguri. Ten people died in the attacks including three suspected sect members and a soldier, he said.
The multiple blasts come a day after motorcycle-mounted gunmen shot dead Sheik Ibrahim Birkuti, a cleric from a rival sect. The police also blame Boko Haram for killing the cleric Monday at his home in the town of Biu, south of Maiduguri.
Birkuti had been critical of Boko Haram's violence and belonged to the Wahabbi group, a splinter faction of Sunni Muslims. Boko Haram is also a splinter group of Sunni Muslims who have pushed for the implementation of Shariah law in Borno State. However, Wahabbi has done so through peaceful means, while Boko Haram has vowed to keep killing people believed to support the establishment until Shariah law is adopted alongside other demands.
Nigeria, a nation of 150 million people, is divided between the Christian-dominated south and the Muslim north. A dozen states across Nigeria's north already have Shariah law in place, though the area remains under the control of secular state governments.
Boko Haram is responsible for a rash of killings which have targeted police officers, soldiers, politicians and clerics in Nigeria's north over the last year. They have also attacked churches and engineered a massive prison break. However, authorities say attacks intensified after April 26 gubernatorial elections kept the same political party in power.
Governor-elect Kashim Shettima promptly reached out to the sect members to calm tensions by offering an amnesty, but a man claiming to speak for Boko Haram told the BBC last month that the group was rejecting the offer.
In a separate and more recent interview with the BBC's Hausa language service, a man claiming to speak for Boko Haram claimed responsibility for three blasts that rocked two cities in Nigeria's north and a town close to the capital hours after the inauguration of Nigeria's president, Goodluck Jonathan, a Christian from the southern part of the country. The National Emergency Management Agency said that 18 people died in the May 29 attacks.
Boko Haram was thought to be vanquished in 2009 after Nigeria's military crushed its mosque into concrete shards, and its leader was arrested and died in police custody. But now, Maiduguri and surrounding villages in Borno state again live in fear.
Routine attacks mean that residents are subjected to searches at dozens of checkpoints. Drivers have to come out of their vehicles, along with their passengers, and walk with their arms raised to prove weapons aren't hidden in their clothing several times a day.
Borno State police chief Mohammed Abubakar said members of the radical sect locally known as Boko Haram detonated bombs at two police stations and at St. Patrick's Church Tuesday afternoon in the city of Maiduguri. Ten people died in the attacks including three suspected sect members and a soldier, he said.
The multiple blasts come a day after motorcycle-mounted gunmen shot dead Sheik Ibrahim Birkuti, a cleric from a rival sect. The police also blame Boko Haram for killing the cleric Monday at his home in the town of Biu, south of Maiduguri.
Birkuti had been critical of Boko Haram's violence and belonged to the Wahabbi group, a splinter faction of Sunni Muslims. Boko Haram is also a splinter group of Sunni Muslims who have pushed for the implementation of Shariah law in Borno State. However, Wahabbi has done so through peaceful means, while Boko Haram has vowed to keep killing people believed to support the establishment until Shariah law is adopted alongside other demands.
Nigeria, a nation of 150 million people, is divided between the Christian-dominated south and the Muslim north. A dozen states across Nigeria's north already have Shariah law in place, though the area remains under the control of secular state governments.
Boko Haram is responsible for a rash of killings which have targeted police officers, soldiers, politicians and clerics in Nigeria's north over the last year. They have also attacked churches and engineered a massive prison break. However, authorities say attacks intensified after April 26 gubernatorial elections kept the same political party in power.
Governor-elect Kashim Shettima promptly reached out to the sect members to calm tensions by offering an amnesty, but a man claiming to speak for Boko Haram told the BBC last month that the group was rejecting the offer.
In a separate and more recent interview with the BBC's Hausa language service, a man claiming to speak for Boko Haram claimed responsibility for three blasts that rocked two cities in Nigeria's north and a town close to the capital hours after the inauguration of Nigeria's president, Goodluck Jonathan, a Christian from the southern part of the country. The National Emergency Management Agency said that 18 people died in the May 29 attacks.
Boko Haram was thought to be vanquished in 2009 after Nigeria's military crushed its mosque into concrete shards, and its leader was arrested and died in police custody. But now, Maiduguri and surrounding villages in Borno state again live in fear.
Routine attacks mean that residents are subjected to searches at dozens of checkpoints. Drivers have to come out of their vehicles, along with their passengers, and walk with their arms raised to prove weapons aren't hidden in their clothing several times a day.
Gaddafi's forces advance on Libya's Misrata: rebels
TRIPOLI (Reuters) – Thousands of troops loyal to Libyan leader Muammar Gaddafi advanced on the rebel-held western city of Misrata on Wednesday, shelling it from three sides in attacks that killed at least 12 rebels, a rebel spokesman said.
There was no immediate comment from Gaddafi's government.
"Misrata is under heavy shelling ... Gaddafi forces are shelling Misrata from three sides: east, west and south," rebel spokesman Hassan al-Misrati told Reuters from inside the town.
"He has sent thousands of troops from all sides and they are trying to enter the city. They are still outside, though."
He added that 12 rebels had been killed and 26 wounded.
The offensive followed a lull in NATO bombing of Tripoli on Wednesday, after 24 hours of some of the heaviest bombardments of the Libyan capital since air strikes began in March.
NATO defense ministers met in Brussels on Wednesday, but there were few signs of willingness to intensify their Libya mission, which has so far failed to oust Gaddafi.
The alliance says the bombing aims to protect civilians from the Libyan leader's military, which crushed popular protests against his rule in February, leaving many dead.
But with officials like British Foreign Secretary William Hague talking explicitly of Gaddafi being forced out, critics say NATO has gone beyond its U.N. mandate to protect civilians.
Western powers are lining up behind the rebels. Spain on Wednesday said it had recognized their National Transitional Council as the country's only representative.
"I'm here today to confirm that the National Transitional Council is the only legitimate representative of the Libyan people," Spanish Foreign Minister Trinidad Jimenez told reporters in the eastern Libyan city of Benghazi on Wednesday.
Rebel spokesman Abdulrahman said from Zintan that Gaddafi's forces had also shelled the western town on Wednesday morning, after massing large numbers of troops toward it.
"They are now using anti-aircraft weapons," he said.
Gaddafi's troops and the rebels have been deadlocked for weeks, with neither side able to hold territory on a road between Ajdabiyah in the east, which Gaddafi's forces shelled on Monday, and the Gaddafi-held oil town of Brega further west.
Rebels control the east of Libya, the western city of Misrata and the range of western mountains near the border with Tunisia. They have been unable to advance on the capital against Gaddafi's better-equipped forces.
NATO SEEKS MORE SUPPORT
NATO sought broader support for the Western bombing campaign in Libya on Wednesday, given that the alliance's air power has been stretched by the latest strikes on Tripoli.
"We want to see increased urgency in some quarters in terms of Libya," NATO Secretary-General Anders Fogh Rasmussen said.
But some NATO allies that have not taken part in the bombing said they would not alter their stance, and Sweden, a non-NATO participant, said it would scale down its role.
Of the 28 NATO allies, only eight, led by Britain and France, have been conducting air strikes on Gaddafi's forces, and a senior U.S. official warned this week that fatigue was beginning to set in among the aircrews already committed.
NATO allies agree Gaddafi must go, but not all view military intervention as the best way to achieve this.
Germany, which opposed the Libyan intervention, said it understood the pressures on Britain and France but would not change its position. Spain said it would not join the mission, despite now recognizing the rebels as Libya's representatives.
"Germany sticks to its position -- no military engagement," German Deputy Defense Minister Christian Schmidt told reporters.
GADDAFI DIGS IN
As bombs fell late on Tuesday, Gaddafi vowed to fight to the end, after strikes on his Bab al-Aziziya compound.
"We only have one choice: we will stay in our land dead or alive," he said in a fiery audio address on state television.
Gaddafi says the rebels are a minority of Islamist militants and the NATO campaign is an attempt to grab Libya's oil.
U.S. President Barack Obama said on Tuesday it was "just a matter of time before Gaddafi goes."
Diplomatic overtures are being made to the rebels by world powers, even Russia and China, despite their misgivings about interference in Libya's sovereign affairs.
A Russian special envoy for Africa said in the rebel capital of Benghazi on Tuesday that Gaddafi could no longer represent Libya and that Russia was ready to help in any way possible.
The Chinese Foreign Ministry said an Egypt-based Chinese diplomat had visited Benghazi to talk with the rebels.
There was no immediate comment from Gaddafi's government.
"Misrata is under heavy shelling ... Gaddafi forces are shelling Misrata from three sides: east, west and south," rebel spokesman Hassan al-Misrati told Reuters from inside the town.
"He has sent thousands of troops from all sides and they are trying to enter the city. They are still outside, though."
He added that 12 rebels had been killed and 26 wounded.
The offensive followed a lull in NATO bombing of Tripoli on Wednesday, after 24 hours of some of the heaviest bombardments of the Libyan capital since air strikes began in March.
NATO defense ministers met in Brussels on Wednesday, but there were few signs of willingness to intensify their Libya mission, which has so far failed to oust Gaddafi.
The alliance says the bombing aims to protect civilians from the Libyan leader's military, which crushed popular protests against his rule in February, leaving many dead.
But with officials like British Foreign Secretary William Hague talking explicitly of Gaddafi being forced out, critics say NATO has gone beyond its U.N. mandate to protect civilians.
Western powers are lining up behind the rebels. Spain on Wednesday said it had recognized their National Transitional Council as the country's only representative.
"I'm here today to confirm that the National Transitional Council is the only legitimate representative of the Libyan people," Spanish Foreign Minister Trinidad Jimenez told reporters in the eastern Libyan city of Benghazi on Wednesday.
Rebel spokesman Abdulrahman said from Zintan that Gaddafi's forces had also shelled the western town on Wednesday morning, after massing large numbers of troops toward it.
"They are now using anti-aircraft weapons," he said.
Gaddafi's troops and the rebels have been deadlocked for weeks, with neither side able to hold territory on a road between Ajdabiyah in the east, which Gaddafi's forces shelled on Monday, and the Gaddafi-held oil town of Brega further west.
Rebels control the east of Libya, the western city of Misrata and the range of western mountains near the border with Tunisia. They have been unable to advance on the capital against Gaddafi's better-equipped forces.
NATO SEEKS MORE SUPPORT
NATO sought broader support for the Western bombing campaign in Libya on Wednesday, given that the alliance's air power has been stretched by the latest strikes on Tripoli.
"We want to see increased urgency in some quarters in terms of Libya," NATO Secretary-General Anders Fogh Rasmussen said.
But some NATO allies that have not taken part in the bombing said they would not alter their stance, and Sweden, a non-NATO participant, said it would scale down its role.
Of the 28 NATO allies, only eight, led by Britain and France, have been conducting air strikes on Gaddafi's forces, and a senior U.S. official warned this week that fatigue was beginning to set in among the aircrews already committed.
NATO allies agree Gaddafi must go, but not all view military intervention as the best way to achieve this.
Germany, which opposed the Libyan intervention, said it understood the pressures on Britain and France but would not change its position. Spain said it would not join the mission, despite now recognizing the rebels as Libya's representatives.
"Germany sticks to its position -- no military engagement," German Deputy Defense Minister Christian Schmidt told reporters.
GADDAFI DIGS IN
As bombs fell late on Tuesday, Gaddafi vowed to fight to the end, after strikes on his Bab al-Aziziya compound.
"We only have one choice: we will stay in our land dead or alive," he said in a fiery audio address on state television.
Gaddafi says the rebels are a minority of Islamist militants and the NATO campaign is an attempt to grab Libya's oil.
U.S. President Barack Obama said on Tuesday it was "just a matter of time before Gaddafi goes."
Diplomatic overtures are being made to the rebels by world powers, even Russia and China, despite their misgivings about interference in Libya's sovereign affairs.
A Russian special envoy for Africa said in the rebel capital of Benghazi on Tuesday that Gaddafi could no longer represent Libya and that Russia was ready to help in any way possible.
The Chinese Foreign Ministry said an Egypt-based Chinese diplomat had visited Benghazi to talk with the rebels.
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