New Greek PM Samaras to name cabinet members

June 21, 2012

ATHENS, Greece (AP) — New Greek Prime Minister Antonis Samaras is set to announce his cabinet Thursday, a day after brokering a three-party governing coalition that ends weeks of political uncertainty in the crisis-afflicted country.

The conservative Samaras was sworn in Wednesday, pledging to restore hope to a country battered by a protracted debt crisis that has forced across-the-board cuts in incomes and public services. Greece has also been hit by soaring unemployment and a deep recession now in its fifth year.

Samaras met with the heads of his two minority coalition partners — Evangelos Venizelos from Socialist PASOK and the smaller Democratic Left's Fotis Kouvelis — to thrash out the final details in the government's policy platform.

Prominent banker Vassilis Rapanos, who is tipped to assume the finance portfolio, took part in the meeting. Caretaker Finance Minister Giorgos Zanias will represent Greece at Thursday's meeting of his eurozone colleagues in Luxembourg.

All three coalition parties have promised to broadly respect Greece's pledges to undertake further harsh austerity measures and reforms, conditions demanded by European partners and the International Monetary Fund in return for more bailout loans.

That commitment, and the formation of a government in a country that had been politically paralyzed since first inconclusive elections on May 6, relieved international markets. Many in Greece and abroad had feared an electoral win by anti-austerity parties could have prompted a disastrous confrontation with Greece's creditors, ended the flow of bailout funds and eventually forced the country out of the 17-member eurozone.

"I am optimistic and I think (Samaras) will lift the country out of the deadlock we've been in for the last two years," said Athens retired business manager Apostolos Athineos. "And I think this will be his only chance."

Kyriakos Tzaferos, an out-of-work civil engineer now working as a real estate agent, said the government deal could help restore market stability. "Probably the economy will try to pick up again and some money will be pumped into the market," he said. "Otherwise, if there's no money in the economy, there's going to be no improvement into what you get in your pocket at the end of the day."

Salaries have been deeply cut over the past two-and-a-half years in the shrinking private job market and the large civil service — although civil servants have been spared from the layoffs that have left more than one in five Greek workers jobless. Pensions have dwindled and taxes repeatedly hiked, although constant pledges to overhaul an inefficient tax system that primarily targets salaried employees and pensioners have failed to deliver.

Greek stocks dropped Thursday after five straight sessions of gains, losing nearly 2 percent in midday trading. Greek shares have lost more than half their value over the past year.

Greece swears in new prime minister

June 20, 2012

ATHENS, Greece (AP) — Greece moved to end its protracted political impasse Wednesday, swearing in a new prime minister to lead a largely pro-bailout coalition tasked with saving the country's place in the eurozone and easing a European financial crisis with global repercussions.

Antonis Samaras, a 61-year-old U.S.-educated economist, became the fourth prime minister in eight months. "I know well the need to restore the dignity of the Greek people that has been wounded," he said. "I know the need for a quick recovery of the economy to restore social justice and social cohesion."

Samaras, leader of the conservative New Democracy party, will head a three-party coalition that includes the socialist PASOK party and the small Democratic Left. The new government faces massive financial challenges. It must deliver on pledges to implement painful austerity measures, including cutting tens of thousands of civil service jobs, in exchange for billions of dollars (euros) in rescue loans from other European countries and the International Monetary Fund.

"You are taking over the governance of the country at a difficult and historic moment. You have many battles to fight, both within Greece and abroad," the outgoing caretaker prime minister, Panagiotis Pikrammenos, told Samaras during their handover.

New Democracy narrowly beat the radical left-wing Syriza party in Sunday's elections, but fell short of enough votes to form a government on its own, leading to power-sharing talks for three days. Similar talks after an inconclusive May 6 election had collapsed after 10 days.

Syriza, led by 37-year-old former student activist Alexis Tsipras, had campaigned on an anti-bailout platform, vowing to pull Greece out of the commitments it made to impose deeply unpopular austerity measures in return for the multibillion-euro bailouts. Greece has been dependent on the bailout funds since May 2010.

Tapping into widespread anger at the austerity, Tsipras quadrupled his party's support since the 2009 elections and will now be the main opposition party — a role it has already said it will use to oppose the bailout.

"Syriza will fight from the position of responsible, active opposition," spokesman Panos Skourletis said after the coalition agreement was announced. "It will stand beside those who suffer from the policies being implemented and will lead the social struggles of the next phase in the effort of keeping alive the hope of overturning the bailout policies."

But with the formation of a largely pro-bailout government, immediate fears of Athens reneging on its pledges have receded. Combined, the coalition's three parties hold a strong majority of 179 out of Parliament's 300 seats — although it is unclear how united they will be. New Democracy and PASOK are longtime foes in a rivalry that extends from the early 1980s.

The new government faces a long, tough job. It must deliver on pledges by its predecessors to generate huge new savings, privatize publicly-owned companies and real estate, cut some 150,000 civil service jobs and open restricted professions to competition.

All three coalition parties broadly back Greece's pledges for further austerity and reforms, but have pledged to re-negotiate some of the terms for the rescue loans. Samaras campaigned on promises to lower taxes, restart the economy and provide income boosts to low earners, large families, police and fighter pilots.

New Democracy and PASOK, the party that came in third in Sunday's vote and is led by former finance minister Evangelos Venizelos, are also looking for an extension of at least two years in the deadlines for implementing fresh cutbacks worth a total €14.5 billion ($18.42 billion).

Fotis Kouvelis of the Democratic Left went further Wednesday, saying Greece should eventually "disengage" from the austerity commitments and "lift those measures that have literally bled society." An initial test could come as early as Thursday, when the finance ministers of the 17-nation Eurozone meet in Luxembourg ahead of an EU summit on June 28-29. Greece will send outgoing finance minister Giorgos Zanias, who met Wednesday night with the heads of the three coalition parties. The meeting was also attended by National Bank of Greece chairman Vasilis Rapanos, tipped to succeed Zanias as finance minister.

The June 28-29 summit "will be the first big battle on the revision of the bailout agreement, the creation of a framework that will allow us to move to positive growth and to combat unemployment, which is the big problem of Greek society," Venizelos said.

The willingness of Greece's international creditors to soften some of the terms will be key. So far, while there have been some slightly conciliatory voices, it is unclear just how much tolerance there will be.

Dutch Prime Minister Mark Rutte, whose country has often taken a hard stance on the Greek crisis, said it was "good news" that a government had been put together quickly. "It is important that Greece now takes the right measures to implement the agreements that we made in the eurogroup," he said after meeting German Chancellor Angela Merkel in Berlin. "I assume that these agreements will be adhered to."

Merkel, whose country is the main contributor to the bailout, called Samaras to congratulate him and wished him "luck and success in the difficult work that lies ahead of him," the German government said. It added that Merkel hopes for "good cooperation" with Samaras and his government, and she invited him to visit Berlin.

The austerity has left the country struggling through a fifth year of recession, with unemployment spiraling to above 22 percent and tens of thousands of businesses shutting down. Earlier Wednesday, hundreds of poverty-stricken Greeks queued in a central Athens park for free vegetables. Cretan farmers handed out some 2,700 10-kilo (22-pound) packages of produce, in cooperation with the capital's municipal authorities.

Among those lining up was Panayiota Sidera, a 31-year-old unemployed Athenian whose husband is also out of a job. The couple lives on a €250 monthly disability pension and rent from an apartment they own, and has a €540-a-month loan installment to pay.

"That's my predicament," she said. The food handout "is helping people, and I'm grateful. ... The government should have been doing this years ago."

Nicholas Paphitis and Menelaos Hadjicostis in Athens and Geir Moulson in Berlin contributed.

Queen's granddaughter thrilled to be in Olympics

June 19, 2012

LONDON (AP) — Zara Phillips will skip the Opening Ceremony of the London Olympics together with her team because competition in her event begins the following day.

The 31-year-old Phillips — granddaughter of Queen Elizabeth II — will be treated just like any other Olympian when she competes, and that means she will be staying in the Athletes' Village. Phillips told reporters at a news conference Tuesday that she was very excited to be part of Britain's eventing team, a difficult discipline that tests dressage, cross-country and show jumping ability.

"It will be great to be part of the Olympics and get the atmosphere and the buzz of being a part of it," she told reporters only strides away from the competition venue at Greenwich park. "In the past, the equestrian has been based quite far out and this time they have made a big effort to have it as part of the Olympics and really nearby to the village, so it will be great to have the atmosphere and benefit from that," Phillips said.

At the London Games she'll be staying with others on the team — Tina Cook, William Fox-Pitt, Georgina French and Mary King. They are fierce competitors most times but a unit for the games. Phillips is aware that a lot of attention will be coming her way this summer because of her royal ties, but she seemed at pains not to make much of that. It took several persistent questions before she acknowledged that the queen was "very proud."

Both of Phillips' parents were British Olympians in equestrian events. Her mother, Princess Anne, competed in Montreal. Her father, Mark Phillips, is a two-time Olympian and gold medalist. When asked if she had spoken with her parents about their experiences in the Olympics, Phillips was almost comical in her brevity after saying they hadn't discussed it: "Mum fell off and Dad is not a big talker."

Even so, her delight in being part of the team was clear. "I'm massively excited and honored to be in the team with these guys, as well as still keeping my fingers crossed, as there are still a few weeks to go and you know what horses are like," she said.

The former world champion and her horse, High Kingdom, had been considered a long shot until recent weeks. Yet the 14th in line for the British throne defied the odds, clawing her way to a spot onto the team after a strong performance at Bramham in northeast England.

The moment is sweet for Phillips because she had to withdraw from competing in the 2008 Beijing Olympics because her horse, Toytown, was injured. Will Connell, the performance director for the U.K. equestrian team, tried to put to rest any suggestion that Phillips had been selected because of her royal ties.

"Zara is on the team because she is an outstanding athlete," he said.

WikiLeaks founder seeks asylum at Ecuador embassy

June 20, 2012

LONDON (AP) — WikiLeaks chief Julian Assange has made a run for the Ecuadorean Embassy in London, seeking asylum in a long shot move that, if successful, would place him in a small, friendly South American country rather than in Sweden facing questioning about alleged sex crimes.

Tuesday's unexpected caper has added a new and bizarre twist to Assange's increasingly desperate bid to avoid extradition to Scandinavia. Ecuadorean Foreign Minister Ricardo Patino said the leftist government of President Rafael Correa — an administration often at odds with Washington — was weighing the request, although he did not indicate when a decision might be made.

Assange said in a brief statement that he was grateful "to the Ecuadorean ambassador and the government of Ecuador for considering my application." Assange's legal options in the U.K. had almost completely run out. Less than a week ago Britain's Supreme Court re-endorsed its decision to allow the 40-year-old's extradition to Sweden, where he is wanted over sex crimes allegations. The accusations — which stem from Assange's trip to the country in mid-2010 — have cast a cloud over his online organization's spectacular leaks of U.S. military, diplomatic, and intelligence material.

Ecuador — where less than one in three people have access to the Web — may seem an unlikely place for the former computer hacker to seek refuge, but in many ways it's an obvious choice. "It's one of the few countries that has given a great opening to Assange's entire cause," said Grace Jaramillo, an international relations professor at Ecuador's FLACSO university.

"Correa sees Assange as a critic of the status quo," he said. "He has been challenging the United States and Correa likes that." Assange argues that extradition to Sweden is a first step in efforts to remove him to the United States, where he claims to have been secretly indicted over his disclosure of 250,000 State Department cables. He has spent the better part of two years fighting the move through the British courts.

But legal experts said Assange's flight to the Ecuadorean embassy was a desperate one. U.K. extradition specialist Karen Todner said she couldn't make sense of the move, while Michael Scharf, based at the Case Western Reserve University School of Law in Cleveland, Ohio, said he didn't believe Assange could be given asylum status.

"I think they are going to end up asking him to leave the premises," said Scharf. Ecuador's mission in London said in a statement that Assange would "remain at the embassy, under the protection of the Ecuadorean government," while his application was considered. Britain's foreign ministry said it was working with Ecuadorean authorities to resolve the situation, but gave few other details.

Aside from Assange's brief statement, WikiLeaks did not elaborate on its leader's plans. Nearly a dozen calls, texts and emails seeking further comment from WikiLeaks and its staff weren't returned. Patino, speaking at a news conference in Quito, the Ecuadorean capital, gave the fullest account of Assange's reasoning, saying he had personally written to Correa to ask for asylum.

Assange, who is Australian, had argued that "the authorities in his country will not defend his minimum guarantees before any government or ignore the obligation to protect a politically persecuted citizen." Patino said. That may be a reference to Australian Prime Minister Julia Gillard, who last month said that her country could not protect Assange from other countries' justice systems.

Ecuador has made friendly noises about Assange in the past. In the November 2010, at the height of the media storm over WikiLeaks' disclosures, its government appeared to offer him sanctuary, and on Assange's newly-launched television talk show — which interviewed Correa via videolink earlier this year — the pair swapped jokes and messages of encouragement.

It was during the interview that Assange received an offer of asylum, according to a woman who was present during the shows and familiar with the offer. She spoke on condition of anonymity because she was not authorized to speak to the media.

It was not immediately clear if the offer came directly from the president himself, although at one point Correa saluted WikiLeaks and told Assange to take courage. "Welcome to the club of those who are persecuted!" said Correa, whose government has been assailed by human rights and press freedom activists for using Ecuador's criminal libel law in sympathetic courts against journalists from the country's biggest newspaper, El Universo.

Assange and his allies had been in discussions over a possible attempt to seek sanctuary in Ecuador since last weekend, according to a person familiar with the matter. "His concern was that once he arrived in Sweden he would be held in custody and would not have a chance to seek sanctuary again," the person said, speaking on condition of anonymity because of the sensitivity of the case.

The person claimed that Assange had explained his reasons for seeking sanctuary to those who put up bail, but Jemima Khan, a celebrity journalist who supports Assange, said she was caught off guard by the news.

"I had expected him to face the allegations," she said in a message posted to Twitter. "I am as surprised as anyone by this." It wasn't immediately clear whether the escape to the Ecuadorean Embassy would invalidate Assange's strict bail conditions, or whether the 200,000 pounds (roughly $315,000) put up by his supporters would be forfeited.

British officials declined to say whether Assange had skipped bail or whether they were now seeking his arrest. Assange will be free from U.K. authorities so long as he remains at the Ecuadorean Embassy, but it's unclear how he could hope to get from the mission, based in London's wealthy Knightsbridge neighborhood, to Ecuador itself.

The embassy's buzzer rang unanswered Tuesday, although several times an unidentified figure peeked out from behind the curtain to look at reporters clustered around the building's entrance. At one point two men emerged from the building; neither addressed the assembled media, but one bore a folio entitled "Diplomatic Law."

Claes Borgstrom, the lawyer representing the two Swedish women with claims against Assange, told Swedish daily Dagens Nyheter late Tuesday that Assange's latest move was a delaying tactic. "It's tragic for the two clients that I represent," he was quoted as saying. "I can't imagine that this will lead anywhere."

Solano reported from Quito, Ecuador. Associated Press writers Frank Bajak in Lima, Peru, Paisley Dodds in London, and Louise Nordstrom in Stockholm, Sweden, contributed to this report.

UK: 'Arms' ship for Syria heading back to Russia

June 20, 2012

LONDON (AP) — A Russian-operated ship said to be carrying military helicopters to Syria appears to have turned back after its British insurer removed coverage for the vessel, U.K. officials said Tuesday.

Britain's Foreign Office said the ship, the MV Alaed, changed course in Europe after news reports emerged about its alleged contents. Earlier, the Foreign Office confirmed it was aware that a ship carrying a consignment of refurbished Russian-made attack helicopters was heading to Syria.


The ship has "turned back now apparently toward Russia," Foreign Secretary William Hague told British lawmakers in Parliament. The vessel appeared to have been avoiding UK territorial waters and EU territorial waters, his ministry added.

"It is good news that the shipment of attack helicopters we've been tracking in the North Sea in recent days is heading away from Syria," British Prime Minister David Cameron said during the G-20 summit in Mexico on Tuesday. "But we will continue to work to stem the flow of weapons."

The news came after the U.K.-based insurer Standard Club said it removed insurance coverage for the ship owner when it became aware it was carrying munitions, a clear breach of its rules. The BBC reported Tuesday that the ship was about 50 miles (80 kilometers) off the Outer Hebrides off the northwest coast of Scotland. The Foreign Office said it was heading toward the Netherlands when it changed course to avoid Dutch territorial waters and turned north.

Russian officials have not commented on the ship or its reported contents. The vessel's Russian operator, Femco, refused to comment Tuesday. Russian President Vladimir Putin said at the G-20 summit that only the Syrian people have the right to decide whether their president, Bashar Assad, steps down.

Putin said Tuesday that not all Syrians want a change in leadership and that all parties need to negotiate a solution to end the bloodshed. Britain has joined the United States and other countries in pressing Russia to halt arms shipments to Assad's regime. Opposition groups say more than 14,000 people have been killed since the Syrian uprising began in March 2011 with mostly peaceful protests. A ferocious government crackdown, however, led many to take up arms and the conflict is now an armed insurgency.

Syria is Russia's last remaining ally in the Middle East, and has been a major customer of Soviet and Russian weapons industries for the last four decades, acquiring billions of dollars' worth of combat jets, helicopters, missiles, armored vehicles and other military gear. Russia has also shielded Assad's regime from international sanctions over its violent crackdown.

The Foreign Office said Hague has told Russian Foreign Minister Sergey Lavrov that all defense shipments to Syria must stop. "We are working closely with international partners to ensure that we are doing all we can to stop the Syrian regime's ability to slaughter civilians being reinforced through assistance from other countries," the Foreign Office said in a statement.

President Barack Obama said at the G-20 that China and Russia were "not aligned" with the U.S. and other nations on Syria but said both countries' leaders recognize the dangers of a civil war. Obama met with Putin and Chinese President Hu Jintao on the sidelines of the economic summit. Syria was a top subject.

China and Russia have close ties to Syria and have vetoed two U.N. resolutions that mentioned the threat of sanctions against Assad's regime. China and Russia, however, did support an observer mission in Syria and a plan by special envoy Kofi Annan to end the violence.

Obama said Russia and China believe "everyone would be better served" if Syria had a mechanism for ceasing the violence." U.S. Secretary of State Hillary Rodham Clinton issued a harsh reprimand to Russia last week, saying that Moscow "dramatically" escalated the crisis in Syria by sending attack helicopters there. The State Department acknowledged later the helicopters she accused Moscow of sending were actually refurbished ones already owned by the Assad regime, but Russia was clearly annoyed, and the spat further fueled tensions between the two countries over Syria.

It was not immediately clear whether the helicopters reported to be aboard the Alaed were the ones Clinton had been referring to. Separately on Tuesday, Syria's government said it was ready to act on a U.N. call to evacuate civilians trapped in the rebellious central city of Homs for more than a week, but blamed rebels for obstructing efforts to get them out.

Maj. Gen. Robert Mood, chief of the U.N. observer mission in the country, has demanded that all warring parties in the conflict allow safe passage for women, children and sick people who need to leave the city and other combat zones.

Mood, speaking after briefing the U.N. Security Council during a closed meeting on the situation in Syria, said that questions about canceling the mission were premature and noted, "We are not going anywhere."

Activists said shelling and clashes between rebel fighters and troops in Homs continued unabated Tuesday, underlining the difficulty in organizing any sort of evacuation. Fierce shelling was reported on the rebel-held districts of Khaldiyeh and Jouret el-Shayeh and nearby areas. Troops backed by helicopter gunships were also bombarding the town of Rastan, north of Homs, which is controlled by rebels.

The Britain-based Syrian Observatory for Human Rights reiterated an urgent appeal for world leaders to intervene to stop the shelling that has trapped more than 1,000 families and "the systematic killings that the Syrian people in Homs are being subjected to."

A Syrian Foreign Ministry statement carried by state-run news agency SANA said the government has contacted the U.N. observer mission and local authorities in Homs to start efforts to bring out the trapped civilians.

"But the efforts of the U.N. monitors' mission failed in achieving this goal because of the armed terrorist groups' obstructions," the statement said, claiming that armed groups were using civilians as "human shields."

The Syrian government regularly refers to the rebels as terrorists.

Associated Press writers Meera Selva in London, Mansur Mirovalev in Moscow, Jan M. Olsen in Copenhagen and Zeina Karam in Beirut contributed to this report.

Pakistan's government nominates new PM

June 21, 2012

ISLAMABAD (AP) — Pakistan's ruling party has confirmed it will nominate outgoing textile minister Makhdoom Shahabuddin as its candidate for prime minister on Thursday, moving quickly after the former premier was ousted by the Supreme Court for contempt of court, a presidential spokesman said.

Shahabuddin, who is considered a Pakistan People's Party loyalist, will file nomination papers in parliament by midday, said presidential spokesman Farhatullah Babar. The PPP's coalition has a majority in parliament and barring last minute surprises is expected to be able to vote him into office in a session scheduled for Friday.

Yousuf Raza Gilani was dismissed by the Supreme Court on Tuesday for contempt of court for failing to initiate a corruption case against President Asif Ali Zardari, the head of the PPP. That was the climax of a bruising power struggle between the government and activist judges. PPP politicians almost immediately began to circulate Shahabuddin's name as a replacement.

The next prime minister will likely also face the same order from the Supreme Court to investigate Zardari, meaning political instability will continue until the government's term ends in March 2013. The Gilani government has been widely criticized for exacerbating or doing nothing to address the massive economic and security challenges in the country.

Stability in Pakistan is seen as vital to American goals of withdrawing from Afghanistan in 2014 and long-term victory against international jihadist terrorism. But relations between Washington and Islamabad are strained over a host of issues, including blocked war supply lines to Afghanistan and Pakistan's alleged support for the Afghan Taliban.

The dismissal of Gilani has made it more likely that polls will now be held before next year, possibly as early as November. Elections in Pakistan must be held under a supposedly neutral caretaker government in place three months before polling day, meaning the current government could be dissolved as early as August.

Shahabuddin, 65, comes from a wealthy, landowning family based in the central Pakistani district of Rahim Yar Khan. His father had served as minister in the cabinets of two Pakistani governments. He also served as minister for finance and health in the current government.

Pakistan to elect new PM on Friday

June 20, 2012

ISLAMABAD (AP) — Pakistan's president summoned parliament to meet on Friday to elect a new prime minister, with the outgoing textile minister emerging as the likely candidate for the job.

Yousuf Raza Gilani was dismissed Tuesday along with his Cabinet by the Supreme Court for failing to investigate his ally President Asif Ali Zardari for corruption, adding to political instability in a country already saddled with massive economic and security problems.

But in moving quickly to install a new premier — and not defying the court order as some had predicted — the government may reduce fears of major upheaval, at least in the short term. In a statement Wednesday, the presidency said the national assembly would be convened on Friday afternoon.

A government official confirmed that the purpose of the meeting was to elect a new premier. Zardari's Pakistan People's Party has the largest number of seats in parliament and is currently in government with coalition partners, which must also support his choice for prime minister to ensure he gets elected. Zardari has been meeting those partners to discuss a candidate.

The official said that Makhdoom Shahabuddin, the outgoing textile minister, was the likely candidate, as did another member of the ruling PPP. They didn't give their names because they weren't authorized to speak on the record about internal party decisions.

Shahabuddin is from Rahim Yar Khan, a conservative Islamic city in south of Punjab province. He is considered a party loyalist and was known to be close to Zardari's late wife Benazir Bhutto, who headed the party but was killed in 2007 by Islamist militants.

Whoever takes over will not have long in power and is likely to face a rocky ride. The government must call elections before March next year. Under the constitution, polls can only be held under a caretaker government, which must be in place three months before election day. Many analysts have speculated that the current political upheaval may expedite the polls, possibly to November. Elections before that date are considered unlikely because of the fierce summer heat.

The new prime minister will also likely run into trouble with the Supreme Court, which is expected to make the same demand of him or her as it did of Gilani, namely to initiate a corruption probe against Zardari. The court has been criticized by some for taking political decisions and jeopardizing the democratic setup in Pakistan.