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Cautious optimism over Iran nuclear offer

Oct 162013
 

Cautious optimism over Iran nuclear offer Iran’s plan to break the deadlock with world powers over its nuclear programme has been received with a sense of “cautious optimisim” in Geneva.

Mohammad Javad Zarif, the Iranian foreign minister, and his team presented a proposal in talks with six world powers on Tuesday which they called a potential breakthrough plan for a decade-old standoff over its contested nuclear programme.

Details of the Iranian proposal – unveiled as a nearly hour-long PowerPoint presentation – were not immediately available.

Michael Mann, the spokesman for the European Union foreign policy chief Catherine Ashton, who leads the negotiations on behalf of world powers, said the Iranian presentation had been “very useful”, but did not elaborate.

Western officials said the fact that the plan was delivered in English for the first time underlined a new mood in the often-tense nuclear talks.

Abbas Araghchi, a senior Iranian negotiator, praised the “very positive environment” and said the “reaction was good” across the table.

He told reporters that all sides had agreed not to reveal details, but insisted the proposal was “very comprehensive”.

However, he was quoted by IRNA, the Iranian state news agency, as saying that snap inspections of Iran’s nuclear facilities were not on the table.

Iran’s two-day meeting with the European Union-chaired P5+1 group — the United States, Britain, France, China and Russia, plus Germany — ends a six-month hiatus over the Islamic republic’s refusal to curb uranium enrichment in exchange for the easing of punishing international sanctions.

The talks in Geneva are seen as a test for the administration of Iranian President Hassan Rouhani, who took office in August pledging transparency on the nuclear programme and engagement with the international community to help lift the sanctions strangling Iran’s economy.

Meanwhile, Israel on Tuesday urged the world to avoid a partial deal with Iran which could see a relaxing of sanctions.

The security cabinet warned the international community against any “partial agreement that would fail to bring about the full dismantling of the Iranian military nuclear programme…[which] could lead to the collapse of the sanctions regime.”

Going nuclear 

The US and its allies suspect Iran is seeking to develop the capability to make nuclear weapons. Iran denies this, but its refusal to curb sensitive nuclear activity has drawn tough international sanctions.

Since 2006, Iran has rejected the UNSC demands that it halt uranium enrichment and has continued to expand its nuclear fuel programme, leading to increasingly harsh sanctions.

Hopes of a negotiated settlement of the dispute were raised last month when President Barack Obama and Rouhani spoke by telephone, the highest level US-Iranian contact since Iran’s Islamic revolution in 1979. Washington and Tehran have not had diplomatic relations since 1980.

In the US, 10 senators – six Democrats and four Republicans – wrote to Obama to say they were open to such a deal to relaxing sanctions on Iran if it slows down its nuclear programme.

The World Bank says sanctions pushed Iran into recession last year, and the Iranian rial lost an estimated 80 percent of its value against the US dollar between March 2012 and March 2013, leading to high inflation. It says bankruptcies are in the rise, Iran’s pharma industry struggles to import supplies and factories are working at half capacity.

The House of Representatives overwhelmingly approved even stricter new sanctions in July. The Senate Banking Committee agreed to delay them until after the Geneva negotiations only after appeals from the Obama administration.

Japanese government to go ahead with sales tax rise

Oct 012013
 

Japanese government to go ahead with sales tax riseJapan’s Prime Minister Shinzo Abe said his government will raise the rate of sales tax to 8% from 1 April next year, from the current 5%.

Policymakers have argued that the hike is key to reducing Japan’s public debt – which now stands as around 230% of its gross domestic product (GDP).

There have been concerns that such a move may hurt domestic demand.

However, analysts said recent data showing signs of a recovery in the economy had helped allay those fears.

Legislation passed by Mr Abe’s predecessor last year had called for the rate to be raised.

The government needs to increase its revenue as it looks to fund rising welfare costs, driven by an ageing population.

It is estimated that 40% of Japan’s population will be of retirement age by 2060.

Mr Abe was quoted by the AFP news agency as saying the tax hike was aimed at “maintaining the nation’s trust and handing over a sustainable social security system to the next generation”.

He added that his government would unveil a fresh stimulus package to ease the impact of the hike on businesses and households.

‘Broad-based improvement’

Earlier on Tuesday, the Bank of Japan’s closely-watched Tankan survey showed a sharp improvement in sentiment among Japanese manufacturers.

The big manufacturers’ index rose to plus 12 in the July-to-September quarter, from plus 4 in the previous three months.

Manufacturers also plan to increase their spending in the current financial year, which should help boost growth.

The improvement comes amid signs of a recovery in the Japanese economy after years of stagnant growth.

“Japan’s economy is on track, and the tankan has shown broad-based improvement in sentiment,” said Yasuo Yamamoto, a senior economist with Mizuho Research Institute in Tokyo.

“Manufacturers had been lagging the overall economy, but the tankan shows improvements in this sector are starting to catch up due to exports and a weak yen.”

The sentiment indexes are calculated by subtracting the percentage of respondents who say business conditions are poor from those who say they are good.

A positive reading means optimists outnumber pessimists.

Abenomics boost

Prime Minister Shinzo Abe, who came to power in December last year, has unveiled a series of aggressive policy measures aimed at reviving Japan’s economy.

His moves, which have come to be known as Abenomics, have started to have some impact on Japan’s growth.

At the same time, Japan’s central bank, the Bank of Japan, has also taken some steps – including setting a 2% inflation target and doubling the country’s money supply – to help boost growth.

These measures have resulted in a sharp decline in the yen’s value. The Japanese currency has fallen nearly 25% against the US dollar since November last year.

A weak yen bodes well for Japan’s large manufacturers, who rely heavily on exports for their growth, as it makes their good more affordable for foreign buyers.

It also helps boost their profits when they repatriate their foreign earnings back home. Many leading Japanese firms have reported an improvement in profits recently.

Analysts said that an improvement in earnings, coupled with the signs of a recovery in the Japanese economy, had helped boost morale.

“Earnings recovery on the back of a weaker yen, which affected only limited sectors at the time of the previous survey, has spread to a wider part of industry,” said Yoshimasa Maruyama, chief economist with Itochu Economic Research Institute in Tokyo.

Deadly Mexico storms leave thousands stranded

Sep 192013
 

Deadly Mexico storms leave thousands stranded The death toll from storms that have swept across Mexico has risen to 80, a civil protection official has said.

Ricardo de la Cruz, national civil protection director general, said on Wednesday the fatalities had occurred across a dozen states.

Tens of thousands of people have been trapped in the aftermath of two tropical storms that hammered vast swathes of Mexico. More than one million people have been affected.

Looting broke out in Acapulco on Wednesday, as thousands of tourists lined up in the hope of getting on emergency aircraft, after resort’s airport terminal was submerged by water.

Shops were plundered in the city’s upscale neighborhood of Diamante, home to luxury hotels and plush apartments, where dozens of cars were ruined by muddy brown floodwaters.

Marines were posted outside stores to prevent further theft.

“Unfortunately, it wasn’t looting from need of food. It was stealing for stealing’s sake,” said Mariberta Medina, head of a local hoteliers’ association.

“They even stole Halloween and Christmas decorations and an outboard motor.”

Food and bottled water were scarce, and cash was hard to come by after power outages knocked out bank machines.

Fresh storm threat

Northwest of Acapulco in the village of La Pintada, rescue workers recovered the bodies of 18 people killed after a landslide buried their homes, the town’s mayor said.

That death toll could rise because more than 60 people in the area have disappeared.

Torrential rains were spawned by the two tropical storms, Ingrid and Manuel, which converged on Mexico from the Gulf and the Pacific over the weekend, triggering the flash floods.

Manuel strengthened to a tropical storm again on the Pacific coast on Wednesday, moving northwest towards the Baja California peninsula, the US National Hurricane Centre (NHC) said.

Rescue workers in the state of Baja California Sur, home to the resorts of Los Cabos, prepared to evacuate people from flood-prone areas.

The storm was expected to hit Baja on Friday, at which time Manuel could be close to hurricane strength, the NHC said.

Another area of low pressure over Mexico’s Yucatan Peninsula has a 70 percent chance of becoming a tropical cyclone by Saturday.

It is likely to dump more heavy rains across an area already hit by floods and mudslides.

Alligators in streets

President Enrique Pena Nieto pledged to repair the damage quickly and was due to conduct a flyover of affected areas on the Gulf coast of Mexico on Wednesday.

The rains pummeled several states, with Veracruz, Guerrero, Puebla, Hidalgo, Michoacan, Tamaulipas and Oaxaca among the hardest hit.

Landslides buried homes and a bus in Veracruz on Mexico’s eastern seaboard. Thousands were evacuated from flooded areas, some by helicopter, and taken to shelters.

Dozens of homes in Tampico, one of the main Gulf ports north of Veracruz, were waterlogged when the Panuco River burst its banks, forcing evacuations.

Alligators swam into the streets of Tampico.

FDI flows into China at $8.38 billion in August

Sep 172013
 
FDI flows into China at $8.38 billion in AugustBEIJING: China attracted $8.38 billion through Foreign Direct Investment (FDI) in August, up 0.62 per cent year-on-year but lower than July figures, the Ministry of Commerce (MOC) today said.

The increase was down sharply from a 24.13 per cent jump in July and 20.12 per cent growth in June, but higher than May’s growth rate of 0.29 per cent, the data released by the Ministry said.

In the first eight months of the year, China’s FDI inflow totalled $79.77 billion, up 6.37 per cent from the same period last year, despite the slowdown of the economy, MOC spokesman Shen Danyang told media here.

The data does not cover incoming investments in banking, securities and insurance sectors.

Shen attributed the subdued growth rate to a higher comparative base in August 2012, when the monthly FDI inflow rose considerably from those in July 2012. “China has seen year-on-year FDI growth for seven straight months since February, which demonstrated the competitiveness of the Chinese economy and foreign investors’ recognition of the business environment in China,” state-run Xinhua news agency quoted Shen as saying.

The FDI growth will remain relatively stable in the next few months and this year’s total FDI inflows can be expected to exceed the 2012 level, Shen said, adding, China emphasises more the quality and structure of foreign investment than the growth figures.

From January to August, China approved the establishment of 14,480 foreign-invested enterprises, down 8.22 per cent from a year earlier.

The services sector saw a steady increase of FDI inflows in the first eight months of the year, up 13.5 per cent and accounted for 49.84 per cent of the total FDI inflows during the period.

Foreign investment in the manufacturing sector fell 3.27 per cent, taking a 40.9 per cent share of the FDI inflows, Shen said.

Direct investment from the US and European Union jumped 18.04 per cent and 4.27 per cent, respectively, to $2.50 billion and $5.44 billion in January-August.

Meanwhile, Chinese investment in overseas non-financial sectors rose 18.5 per cent to $56.5 billion in the first eight months, the ministry said.

Customs data also indicated that exports and imports have further recovered due to a stable yuan and increasing external demand.

Trade surplus widened by 8.4 per cent to $28.52 billion in August, the highest since January this year. “The macroeconomic situation in the past few months showed that the country’s economy is developing in a positive trend,” Shen said, adding, the trend will not be affected by short-term difficulties in some countries or the so-called financial crisis in some emerging markets.

Australia plans to scrap carbon tax

Jul 152013
 

Australia plans to scrap carbon tax Australia will scrap its carbon tax and bring forward an emissions trading scheme a year earlier than planned, Treasurer Chris Bowen said, a policy shift certain to be a focal point in the forthcoming election.

Under current plans, Australia would move from the current fixed price on carbon - essentially a tax assessed on larger companies entitling them to produce carbon emissions - to a floating price in July 2015.

Bowen on Sunday confirmed media reports that the fixed $21.9 per tonne carbon tax would be dumped in favour of a floating price of between $5.5 and $9.1 per tonne from July 1, 2014, to ease cost of living pressure for families and help support the non-mining sectors of the economy.

Australia is among the world’s worst per capita polluters due to its reliance on coal-fired power and mining exports and introduced a carbon tax in 2012, charging big polluters for their emissions.

The tax applies to around 300 of Australia’s biggest polluters, including mining giant BHP Billiton, Qantas Airways and BlueScope Steel.

The government has always said it would move to an emissions trading scheme after three years with a floating price set by the market, but new Prime Minister Kevin Rudd has now moved that forward a year.

The floating price is expected to be cheaper for big business and the move is set to cost the government billions of dollars.

Upcoming elections

Bowen said cuts would be made elsewhere to compensate with the Labor Party sticking to its plan to return the budget to surplus in 2015-2016.

With national elections later this year, Labor is hoping the change will see a drop in soaring electricity prices.

“There is a substantial impact on the budget of doing this, of course there is, and it is several billion dollars, but we will be financing that in a fiscally responsible way,” Bowen told Channel Ten, adding that full details would be announced over the coming days.

The issue of a carbon tax has been hotly debated in Australia.

Former Labor prime minister Julia Gillard’s popularity sunk after she announced plans for the carbon tax in early 2011 – after pledging before her 2010 election that it would not be introduced by a government she led.

The policy backflip prompted protests around the country and conservative opposition leader Tony Abbott, who opinion polls suggest will narrowly win the 2013 election, has vowed to abolish it.

Abbott on Sunday said the shift to 2014 was “just another Kevin con job.

“Mr Rudd can change the name but whether it is fixed or floating it is still a carbon tax,” he said, adding that “it’s a bad tax, you’ve just got to get rid of it”.

China trade data suggests prolonged slowdown

Jul 112013
 

China trade data suggests prolonged slowdown China’s trade surplus fell 14 percent in June with drops recorded in both imports and exports compared to a year earlier.

The unexpected decrease in the data announced on Wednesday suggests a further slowdown in the Asian economic giant on the back of global weakness.

The figures are seen as the latest to set alarm bells ringing over the health of China’s rebound from a prolonged downtrend as trade and manufacturing conditions have worsened this year.

Exports slipped 3.1 percent to $174.3bn while imports were down 0.7 percent at $147.1bn, resulting in a trade surplus of $27.1bn, according to figures from data from the General Administration of Customs.

Average expectations in a survey of 20 economists by Dow Jones Newswires had been for a 3.3 percent rise in exports and imports to go up 5.5 percent.

“Currently China’s foreign trade is facing grave challenges,” Zheng Yuesheng, General Administration of Customs spokesman, told reporters.

He said “prolonged sluggish foreign demand” was the main cause, followed by rising export prices in foreign currency terms, labour costs, and a deteriorating trade environment due to growing trade disputes.

Economists from Australia-headquartered ANZ bank warned China would not achieve its goal of eight percent growth in trade this year if the softness persists. China failed to deliver a 10-percent gain targeted for 2012.

“This will not only bring about downside risk to the gross domestic product (GDP) growth for this year but also place severe pressure on employment,” ANZ’s Liu Ligang and Zhou Hao said in a research note.

China’s economy grew 7.8 percent in 2012, its worst performance in 13 years, on the back of slack demand for exports and weakness at home.

Global cut

The first three months of this year saw an economic expansion of just 7.7 percent, disappointing analysts who had expected growth to accelerate after showing strength at the end of 2012.

The government has set a growth target for 2013 of 7.5 percent, the same as last year’s, as it looks to retool its economic model from exports to domestic consumption.

Beijing is due to announce GDP figures for the second quarter on Monday.

China’s June trade figures came after the International Monetary Fund (IMF) on Tuesday cut its global economic growth forecast, citing new downside risks in key emerging-market economies and a deeper recession in the eurozone.

The IMF projected the world economy to expand 3.1 percent in 2013, down from its April stimate of 3.3 percent.

China and other emerging economic powers now face new risks, the IMF warned, “including the possibility of a longer growth slowdown”.

Strike grounds hundreds of Lufthansa flights

Apr 222013
 

Most of Lufthansa’s, Germany’s national airline, domestic, European and long-haul flights have been cancelled due to strikes by ground personnel and cabin crews.

“Due to strike action announced for April 22, nearly all Lufthansa flights to German and European destinations must be cancelled,” the airline announced in a statement.

The firm said it had scheduled only around 20 of its usual 1,650 short-haul flights for Monday, and warned that long-haul routes would also be seriously affected.

At Frankfurt airport, Europe’s third-busiest hub, 46 out of 50 intercontinental flights would be scrapped, with long-haul flights from Munich also grounded.

‘All-out strike’

Services union Verdi called the strike after three rounds of pay talks with management ended without agreement.

Verdi is demanding a 5.2 percent pay increase for 33,000 Lufthansa ground staff, plus employees of various subsidiaries, as well as cabin crew members who are Verdi members.

The escalating pay dispute threatens to cause transport chaos across Germany, Europe’s largest economy.

It comes a month after Lufthansa was forced to cancel nearly 700 out of a total 1,800 flights due to half a day of warning strikes.

Lufthansa board member Stefan Lauer said the action, described as a 24-hour warning strike, was “de facto an all-out strike” that was “a completely excessive measure that can in no way be justified in view of the current state of negotiations”.

Verdi has accused management of “playing with employees’ fears about their future and their jobs” in refusing to make any concrete guarantees.

The union has complained that the offer tabled by management represented an increase of less than one percent over a period of one year.

China accuses US of destabilising region

Apr 172013
 

China has accused the US of destabilising the Asia-Pacific region by strengthening its military presence in the area.

China made the claim in its defence ministry’s annual white paper, saying the US was sending more ships, planes and troops into the region.

“There are some countries which are strengthening their Asia-Pacific military alliances, expanding their military presence in the region and frequently make the situation there tenser,” the document, published on Tuesday, said.

It states that the US policy has emboldened Japan, the Philippines and Vietnam regarding territorial disputes and China now faces “multiple and complicated security threats”.

“Certain efforts made to highlight the military agenda, enhance military deployment and also strengthen alliances are not in line with the calling of the times and are not conducive to the upholding of peace and stability in the region,” Yang Yujun, spokesman, said at a news conference marking the report’s release.

China has criticised the US deployment of ships and personnel to Asia, as well as its increasing cooperation with treaty partners, including Japan, South Korea and the Philippines.

Re-orientation defended

For his part, John Kerry, US secretary of state, defended the re-orientation of US foreign policy as he ended his trip to the region.

The US calls the restructuring a natural reallocation of resources to the world’s most economically dynamic region.

China, however, sees it as designed to contain its diplomatic, military and economic rise.

The US policy determines that 60 percent of the navy’s fleet will be deployed to the Pacific by 2020.

Singapore will house four new US Littoral Combat Ships designed to fight close to shorelines, while Indonesia wants to buy a range of American hardware and take part in joint manoeuvres.

The Philippines wants to host more US troops and Australia has agreed to allow up to 2,500 Marine Corps soldiers to deploy to the northern city of Darwin.

China has also been angered by what it sees as US support for its opponents in disputes with Japan, the Philippines and others over territory in the East China and South China seas.

“China views the US actions as proving it is biased against it,” Qian Liwei, an associated research fellow at the China Institutes of Contemporary International Relations, wrote in the official English-language newspaper, China Daily, on Tuesday.

“It will take time and patience to convince China that it isn’t the target of the US’s rebalancing.”

In its report, the defence ministry tried to address concerns about its 500-percent-plus increase in defence spending over the past 14 years, making China’s defence budget the second largest in the world after America.

Much of the report was devoted to the military’s contribution to UN peacekeeping efforts and disaster relief.

It also asserted the army’s role as a guarantor of China’s core interests, pledging to tolerate no violation of those.

“China will resolutely take all necessary measures to safeguard its national sovereignty and territorial integrity,” the report said.

Italy ship disaster inquiry resumes

Apr 162013
 

An Italian court has resumed a hearing into the Costa Concordia cruise ship disaster, which left 32 people dead.

The case, which re-opened on Monday, is focusing on whether to hand down indictments to six men, including the ship’s captain.

The men have been accused of contributing to the accident, which happened in January 2012, by delaying rescue operations.

Prosecutors want Captain Francesco Schettino to stand trial for manslaughter, causing a shipwreck, misinforming coast guards during the rescue operation and abandoning the ship before all 4,200 passengers and crew had been evacuated.

They also want four crew members and a land-based manager to face manslaughter charges.

The preliminary hearing, held in Groseto, Tuscany, is expected to focus on the passengers seeking damages due to injuries, trauma and loss.

A decision regarding the indictments was not expected to be reached on Monday.

Evacuation delayed

Schettino ordered the ship to be taken off course on January 13 last year to bring it closer to the island of Giglio, near Tuscany, as a favour to friends.

The ship crashed into a reef off the island, leaving a 70-metre gash in the hull and causing the liner to take on water and capsize.

Passengers said the evacuation was delayed and by the time Schettino gave the evacuation order, the ship was listing so far to one side that many lifeboats could not be lowered.

Schettino has defended his actions, saying he saved lives by bringing the crippled ship closer to port.

He also stated that the reef was not on his nautical charts and denied abandoning ship, saying he fell off the liner when it titled at a near-90 degree angle.

First officer on duty on the bridge at the time of the crash, Ciro Ambrosino, is one of the four crew accused of wrongdoing.

Ambrosino’s attorney Salvatore Catalano, said on Monday that his client was still suffering from what happened.

“From the point of view of responsibility, I can absolutely exclude that Ciro Ambrosio is responsible,” Catalano said.

Lawyers representing victims were at the hearing to make the case for greater compensation than that offered by holding company Costa Crociere S.p.A immediately after the disaster.

Two weeks after the capsizing, Costa offered passengers $14,460 plus reimbursement for the cost of their cruises and extra travel expenses.

The offer was accepted by many passengers.

Massimiliano Gabrieli, who is representing several dozen Italian passengers, said they would be asking for $1.3m per victim.

Costa attorney Marco De Luca said the request was ridiculous.

Captain ‘scapegoat’

Codacons, a consumer association which is suing Costa on behalf of some survivors, has published a report that showed key equipment on board apparently malfunctioned including its sealed doors and lifts.

Bruno Neri, a professor called by Codacons to carry out the technical analysis, said: “Schettino has been turned into a scapegoat.”

The company negotiated a controversial plea bargain with the court in the criminal case last week in which it accepted limited responsibility as the employer of the suspects and was ordered to pay a $1.3m fine.

“This company has disregarded safety for the sake of its passengers, to just increase its profits. The industry must change,” said John Artur Eaves, a US lawyer representing about 150 survivors.

The Costa Concordia remains on its side, grounded off Giglio’s port.

UN says funds for Syrian refugees running out

Apr 062013
 

UN says funds for Syrian refugees running out The United Nations Children’s Fund (UNICEF) has warned that it will soon run out of money to cope with the vast needs of internally displaced Syrians as well as refugees in neighbouring countries.

UNICEF said on Friday that it would run out of money by June for its operations in Jordan – where it provides water sanitation and hygiene services to about 100,000 refugees living in Zaatari camp.

Marixie Mercado, the UNICEF spokeswoman, said: “The needs are rising exponentially, and we are broke.”

“We have received about 29 percent of the money we need to be able to sustain our operations inside Syria and in neighbouring countries,” Ted Chaiban, UNICEF Director of Emergency Operations, told Al Jazeera.

In the case of Zaatari camp, if UNICEF programmes cease functioning, the population will no longer have access to clean water or hygiene facilities.

“Then you will see skin diseases, diarrhoea and dramatic consequences for children,” Chaiban said.

The number of Syrian refugees in Jordan is approaching half a million.

The UN is predicting that the number of Syrian refugees in Jordan will more than double to 1.2 million by the end of this year.

UNICEF also works inside Syria with the International Committee of the Red Cross (ICRC) to provide support to urban water systems that allows continued access to water in major cities.

In addition, the aid group runs an immunisation campaign for the increasing number of internally-displaced people that provides life-saving measles and polio vaccinations to three milllion children.

“If you stop immunisations, you have the kind of measles outbreak we saw in Lebanon recently. And measles plus malnutrition can lead to children dying. These are profound consequences,” Chaiban told Al Jazeera.

Rebels overrun army garrison

Clashes broke out across Syria on Friday, with Syrian rebels claiming they have overrun an army garrison that defends the main southern border crossing with Jordan on Friday and vowed to press on to take control of the major transit route.

Fighters from the Free Syrian Army said that they captured the Um al-Mayathen post on the main Damascus-Jordan highway in heavy fighting overnight that ended a more than week-long siege.

Confirming the development, the Syrian Observatory for Human Rights (SOHR) said: “Rebel fighters took control of the Um al-Mayathen military checkpoint … in Deraa province in clashes with regime forces.”

Earlier in the day, activists said a barrage of rockets slammed into a contested district on the northeasternedge of Damascus, killing at least five people and trapping others under the rubble.

The attack on the capital’s Barzeh neighbourhood, where opposition fighters are known to operate, followed days of heavy fighting between the rebels and the military in the area.

Meanwhile, the Italian Foreign Ministry said four Italian journalists were kidnapped in northern Syria, the Italian news agency ANSA said. It provided no further details.

Italian media said that one of the reporters worked for RAI state television, two were freelance and one was an Italian-Syrian woman who works with an Italian newspaper.

‘Domino effect’

Bashar al-Assad, the Syrian president, has warned that the fall of his regime or the breakup of Syria will unleash a “domino effect” that will fuel Middle East instability for years to come, in his sharpest warning yet about the potential fallout of his country’s civil war on neighbouring states.

Speaking in an interview broadcast on Friday, Assad accused his neighbours of stoking the revolt against his rule and warned they would eventually pay a heavy price.

“We are surrounded by countries that help terrorists and allow them to enter Syria,” he told the Turkish TV station Ulusal Kanal.

“Everybody knows that if the disturbances in Syria reach the point of the country’s breakup, or terrorist forces control Syria … then this will immediately spill over into neighbouring countries and there will be a domino effect that will reach countries across the Middle East,” he said.

The Syrian regime is under growing pressure from an increasingly effective rebel force that has managed to pry away much of northern Syria and is making significant headway in the south, capturing military bases and territory that could offer rebels a staging ground to attack the capital, Damascus, the seat of Assad’s power.