European stocks steady at open

30 December 2010 - 10H34

A Cambodian woman counts US dollar bills and Japanese yen notes at her currency exchange shop in Phnom Penh in October. The dollar weakened against the yen on Thursday.

AFP - Europe's main stock markets were little changed at the start of trading on Thursday, with London's benchmark FTSE 100 index down 0.07 percent to 5,992.50 points compared with the previous day's close.

Frankfurt's DAX 30 grew 0.02 percent to 6,996.56 points and in Paris the CAC 40 gained 0.08 percent to 3,893.51.

Dollar-sensitive stocks were weak as the dollar fell, particularly against the yen, as investors exited the US currency because of falling US bond yields.

EU 'could end China arms embargo'

30 December 2010 - 10H40

A Chinese paramilitary guard mans his post on Tiananmen Square during the opening session of the National People's Congress in Beijing on March 5, 2010. A European Union arms embargo clamped on China in 1989 following the Tiananmen Square crackdown could be lifted in early 2011, Brussels sources told France's Le Figaro daily.

AFP - A European Union arms embargo clamped on China in 1989 following the Tiananmen Square crackdown could be lifted in early 2011, Brussels sources told Thursday's edition of France's Le Figaro daily.

The lifting of the embargo on all lethal weapons "could happen very quickly," a source close to EU foreign policy chief Catherine Ashton told the paper.

It said that the embargo was considered a slap in the face for the world's second largest economic bloc as well as militarily ineffective by the EU as China increasingly builds its own weapons.

A confidential report presented to the last European Union summit that ended on December 17 described the embargo as "a major obstacle" to Europe-China security and foreign policy cooperation.

As a result "the EU should draw the practical conclusions and go ahead," the report said.

Europe was divided on the issue when it was discussed at a meeting of the EU's 27 foreign ministers in September, with some mooting the idea of a conditional lifting of the embargo.

Conditions included improved ties with Taiwan, an amnesty for arrests linked to the Tiananmen crackdown, and a calendar for the ratification of the convention on civil and political rights.

The Figaro said that the Netherlands, Britain and, to a lesser extent, Germany, had all lowered their opposition to lifting the embargo.

Chinese troops and tanks ended weeks of pro-democracy protests in Beijing's Tiananmen Square on June 4, 1989, killing hundreds if not thousands of demonstrators.

N.Korea 'boosts special forces'

30 December 2010 - 10H47

File photo of a North Korean military honour guard. North Korea has added 20,000 soldiers to its feared special forces over the past two years and deployed an unspecified number of new battle tanks, South Korea's defence ministry said Thursday.

This undated photo shows North Korean leader Kim Jong-Il (front row C) photographed with officers and soldiers of the KPA unit 2670 after his inspection of the unit in an undisclosed location in North Korea.

AFP - North Korea has added 20,000 soldiers to its feared special forces over the past two years and deployed an unspecified number of new battle tanks, South Korea's defence ministry said Thursday.

In its two-yearly white paper, the ministry said the size of the special forces had risen to 200,000 over the past two years.

But the total size of the North's military remained unchanged at about 1.19 million, the paper said.

"Threats from North Korea's asymmetric warfare capabilities such as special forces, artillery pieces and weapons of mass destruction have been rising steadily since 2008," Deputy Defence Minister Chang Kwang-Il told journalists.

Experts say the North increasingly focuses on unconventional or "asymmetric" weapons because its ageing conventional weapons are no match for South Korean or US equipment.

The report was released at a time of high cross-border tensions after the North last month shelled a South Korean border island, killing four people including civilians.

The paper said the North's frontline 170mm self-propelled artillery and 240mm multiple rocket launchers are capable of carrying out a "massive surprise bombardment" of Seoul and neighbouring areas, even if the overall number of artillery pieces changed little over the past two years.

It also confirmed the communist state deployed its new battle tank, "Pokpung-ho" ("Storm Tiger"), which the North claims is comparable or superior to the Russian T-72 developed in the 1990s.

The paper did not say how many of the new tanks the North has deployed for operational use. The overall number of its tanks rose to some 4,100 as of last month from 3,900 in 2008, the paper said.

But most of the newly added tanks had old-style equipment deployed in the rear, a military intelligence official told the briefing.

The North carried out its first atomic test in 2006 and a second in 2009.

It is suspected of having secured about 40 kg (88 pounds) of weapons-grade plutonium from its reactor at Yongbyon, the paper said, giving the same estimate as in 2008.

Estimates vary but the stockpile is thought to be enough to build six to eight nuclear weapons.

Concerns about the North's nuclear weapons programme deepened last month when it revealed a uranium enrichment plant -- a potential new source of bomb-making material -- to a visiting US scientist.

Malaysia grants public holiday for ASEAN Cup win

30 December 2010 - 11H03

The captain of Malaysian team Safiq (C) holds up the trophy of the Suzuki Cup 2010 in Jakarta. Malaysia won its first ASEAN Suzuki Cup Wednesday by beating Indonesia with an aggregate score of 4-2 for the first and second legs of the Southeast Asian championships final.

AFP - Malaysians on Thursday celebrated their first win at a regional football tournament in more than two decades, prompting the prime minister to declare a public holiday.

Malaysia took its first ASEAN Suzuki Cup on Wednesday, beating Indonesia 4-2 on aggregate over two legs of the Southeast Asian championships finals in Jakarta.

The country last won the biennial Southeast Asian Games at the 1989 Kuala Lumpur tournament and had never taken the ASEAN Cup, launched 14 years ago.

The success dominated the front pages of almost all local papers, with the influential Star daily declaring "The Cup is ours" and the New Straits Times plastering a picture of the victorious players across its front and back pages under the headline "CHAMPIONS".

Premier Najib Razak declared Friday a public holiday to mark the victory, according to state media.

"This is the greatest night in Malaysian football. The team had done us proud and we must build upon this success to propel Malaysian football to greater heights," he told the Bernama news agency late Wednesday.

An aide to the premier confirmed the announcement and comments Thursday.

The returning footballers were mobbed by over 500 fans at Kuala Lumpur's international airport in the afternoon, who presented team members with bouquets of flowers and waved Malaysian flags and banners.

In the second leg, held in Jakarta's Gelora Bung Karno Stadium, Indonesia beat Malaysia 2-1 but it was not enough to overcome Malaysia's 3-0 win in Kuala Lumpur last Wednesday.

Losing the ASEAN Suzuki Cup tournament was a bitter pill for Indonesia to swallow after beating Malaysia 5-1 in a qualification match earlier this month.

Last week's first leg was marred by incidents in which fans aimed laser beams at Indonesian players during the game.

Swiss franc hits record high vs dollar, euro, pound

30 December 2010 - 11H21

A view of the Swiss ski resort of Gstaad and the montains around it. The Swiss franc strengthened on Thursday to new highs against the US dollar, euro and the British pound, as investors turned to the refuge currency amid weakness in other industrialised economies.

AFP - The Swiss franc strengthened on Thursday to new highs against the US dollar, euro and the British pound, as investors turned to the safe-haven currency amid weakness in other industrialised economies.

The euro slumped below the barrier of 1.24 francs in early morning trade, trading at just 1.2396 francs.

Meanwhile, the dollar also weakened to 0.9374 francs, and the pound was down to 1.4525 francs.

The strengthening Swiss currency has become a bane for exporters here.

With interest rates already at a record low, the central bank has little leeway to temper the franc's rise.

The Swiss government's advisory panel of leading economists in December heralded a slowdown in ever more costly exports over the coming year, helping to pare down Switzerland's economic growth from a 2.7 percent in 2010 to 1.5 percent in 2011.

Blast at Greek embassy in Buenos Aires

30 December 2010 - 11H39

Argentinian police guard the Greek embassy in Buenos Aires on May 12, during a demo in support of Greek trade unions. A bomb exploded early Thursday in front of the Greek embassy in the Argentine capital, causing material damage but no injuries, police said.

AFP - A bomb exploded early Thursday in front of the Greek embassy in the Argentine capital, causing material damage but no injuries, police said.

Pope acts to tackle money-laundering in Vatican

30 December 2010 - 12H44

Pope Benedict XVI (C) waves to people gathered in Aula Paolo VI at the Vatican during his weekly general audience. The Pope created a new financial authority in the Vatican in order to join the "fight against money laundering and the financing of terrorism."

AFP - Pope Benedict XVI created a new financial authority in the Vatican on Thursday in order to join the "fight against money laundering and the financing of terrorism."

Benedict's letter, which addressed "the prevention and opposition to illegal financial activity," comes three months after an investigation was launched into two senior figures at the Vatican bank.

"As of today, all organisations associated with the government of the Catholic Church... have become part of the system of juridical principles and instruments" set up by the international community, Vatican spokesman Federico Lombardi said in a statement.

Lombardi said the Vatican was "committed" to fighting illegal activities such as "the recycling of the profits of crime" and "the financing of terrorism" by adopting international rules "to prevent and combat these terrible phenomena."

The Vatican's new financial authority should bring the Holy See in line with international standards.

By promising to adhere to European rules on money-laundering laid down by the Organisation for European Economic Co-operation (OEEC), the Vatican hopes to make it onto the "White list" of countries compliant with strict financial controls.

The changes come after an investigation into the Vatican bank -- also known as the Institute for Religious Works (IOR) -- for alleged violation of money-laundering rules.

In September, Italy's financial police seized 23 million euros from IOR after the financial intelligence office at the Bank of Italy noticed two operations by the bank that it deemed suspicious.