Zelaya's Honduras exit 'aborted'

The de facto government of Honduras has said that plans for Manuel Zelaya, the country's deposed president, to leave the Honduran capital for Mexico have been put on hold.

Sources had said on Wednesday that Zelaya, who has sheltered at the Brazilian embassy in Tegucigalpa since returning from exile in September, was due to head to Mexico within hours.

But Carlos Lopez, Honduras's foreign minister, told Honduran television that the plan had been "aborted under current circumstances".

Milton Mateo, a spokesman for the Honduran foreign ministry, had earlier said that Mexico had asked for a safe-conduct pass for Zelaya, and that the pass had been signed off.

Security forces alerted

Craig Mauro, an Al Jazeera correspondent who has reported on the politicial events in Honduras, said: "There was a lot of activity around the Brazilian embassy in Tegucigalpa where Zelaya has taken refuge for the last couple of months.

"There were reports that the number of security forces there have been doubled, and that Zelaya would be leaving to take asylum in Mexico," Mauro said from Buenos Aires, Argentina.

"Since then there have been conflicting reports. Honduran aviation officials [said] that a plane is on the way from Mexico, and there [were] some reports from Mexico, quoting unnamed sources, that he has been granted asylum.

"Zelaya has just spoken to a Venezuelan television network and he has neither confirmed nor denied that he would be seeking asylum."

The de facto government, which has held power since Zelaya was deposed on June 28, wants Zelaya to take political asylum in another country, which would restrict his political activities.

However, Zelaya seeks a status that would allow him to campaign fully for his return, Daniel Ortega, Nicaragua's president, said on Wednesday.

Political crisis

Zelaya has demanded his reinstatement since being ousted, but the country's congress voted against restoring him to power.

Fresh elections that were held last month saw Porfirio Lobo, a National Party politician, win the presidency.

Zelaya was forced into exile after the supreme court, congress and business leaders said he acted against the constitution and tried to illegally extend limits to his term in office. He has repeatedly denied this and pointed out that it would have been impossible to change the constitution before his term in office was complete. Divisions in the Central American nation remain wide even after the election, which Zelaya's supporters boycotted, and nations across the Americas are also at odds over whether to recognise the poll. "The US has said that it recognised the elections but that it was only a step forward, and that it wanted to national reconciliation," Mauro said. "Several countiries have followed the US' lead there, but there is also a bloc, led by Argentina, Brazil and Venezuela, that refuses to recognise the elections and which is demanding that Zelaya be restored to the presidency [to serve out the rest of his term], no matter what." Lobo, who was defeated by Zelaya in the 2005 election, has pledged to form a unity government and seek dialogue. He is due to take office on January 27, when Zelaya's term officially ends.

Source: Al Jazeera and agencies

Iraq orders security shakeup after Baghdad blasts

CHELSEA J. CARTER

Associated Press Writer= BAGHDAD (AP) — Iraq's Western-backed government — facing intense pressure to address security lapses after suicide bombings killed 127 people in the capital — ordered a shake-up Wednesday in the country's military leadership.

The angry mood that led Prime Minister Nouri al-Maliki to replace Baghdad's top military commander reveals a stark psychological shift among Iraqis who once accepted such violence as routine and are now demanding someone pay a political price.

Al-Maliki appealed for Iraqis to be patient as he signaled more changes might be ahead for security officials. The prime minister was expected to attend a special parliamentary session Thursday, where lawmakers demanded his security ministers answer for lapses that allowed for the attacks.

"I call on the Iraqi people for more patience and steadfastness," al-Maliki said in a televised address.

It was unclear whether the replacement of Lt. Gen. Abboud Qanbar would quiet outraged lawmakers, who are questioning how suicide bombers managed to launch multiple attacks Tuesday in heavily guarded central Baghdad. The blasts wounded more than 500.

Much of al-Maliki's appeal was aimed at calming anger that has united Iraq's ethnic and sectarian rivals — from Kurd to Arab, Shiite to Sunni — with their calls on Iraq's interior and defense ministers to resign.

"They have proved failures," said Saadi al-Barzanji, a Kurdish lawmaker.

Even the group that Iraq has accused of masterminding this week's bombings as well as two previous major attacks has called on security officials to step down.

"He who cannot ensure security for Iraqis should leave," Baath party spokesman Khudair al-Murshidi told Al-Jazeera in an interview from Syria. Al-Murshidi has denied that loyalists of Saddam Hussein's Baath party were behind any of the attacks.

Top security officials have twice failed to appear after being called before lawmakers. Those request followed suicide bombings against government buildings Aug. 19 and Oct. 25. More than 250 were killed in the earlier attacks.

Ayad al-Samarrie, the parliament speaker, on Tuesday again called on the ministers and others to appear before legislators, said Omar al-Mashhadani, the speaker's spokesman.

Interior Minister Jawad al-Bolani said he would attend the session only if it was not held behind closed doors, according to a statement released by his office. It was not clear whether his demand was met or whether other officials would attend. Security matters have typically been discussed in parliament in closed session.

The political fallout provides a sharp contrast to what occurred following attacks that produced equal or greater devastation in previous years in Baghdad. At the height of the insurgency, tens of thousands died in street fighting and bombing attacks with virtually no calls for resignations.

During the address on state television, al-Maliki said Iraq's security strategies would be reviewed and possible personnel changes made. He stopped short of saying whether any of his ministers would be held responsible.

Al-Maliki appointed Lt. Gen. Ahmed Hashim Ouda late Wednesday to head Baghdad's military operations, according to state television.

Ouda has been a close political ally of al-Maliki and belongs to his Dawa party. He fought in the Iran-Iraq war, commanding an army division, and led an Iraqi army division during the 1991 Gulf War.

The prime minister previously has not asked any of his top security advisers to step down, but he now may have little choice. Al-Maliki has been running for re-election on a platform of improved security, and a lack of response could cost the prime minister and his party votes.

The U.S. has refrained from commenting publicly about the security lapses, instead warning of a possible rise in violence aimed at destabilizing the government ahead of the March 7 parliamentary elections. The top American commander in Iraq, Gen. Raymond Odierno, has said he will keep the bulk of the 120,000 U.S. troops in place until after the election.

There have been no claims of responsibility for the latest bombings, though the U.S. military has said high-profile vehicle bombs and simultaneous suicide bombings are the hallmarks of al-Qaida.

In his address, Al-Maliki called on neighbors to do more to stop to prevent insurgent attacks in Iraq — an apparent reference to Syria. Relations between the two countries soured after Baghdad accused Syria of harboring senior Baathists who masterminded the attacks in August and October. Syria denies it.

"I demand of the international community and all countries, including neighboring countries, who condemn the attacks to turn their words into actions and support the Iraqi people and the Iraqi government by confronting terrorism," al-Maliki said.

Sarkozy and Brown call for global market changes

British Prime Minister Gordon Brown and French President Nicolas Sarkozy have issued a joint call for urgent global reform of financial markets.

Writing in the Wall Street Journal, they say a one-off tax on bank bonuses should be "considered a priority".

The two leaders say it is "simply not acceptable" for taxpayers to cover the cost of bank failures but not benefit from their successes.

The article comes as EU leaders prepare to meet for a summit in Brussels.

It also follows the announcement in a pre-Budget report by UK finance minister Alistair Darling of a one-off supertax on banker bonuses.

'Proper regulation'

The BBC's Jonny Dymond, in the Belgian capital, says the joint article at times reads like a call to arms.

In it, Mr Sarkozy and Mr Brown say the financial crisis has made them "recognise that we are now in an economy which is no longer national but global, so financial standards must also be global".

"We must ensure that through proper regulation, the financial sector operates on a level playing field globally."

They say there is an "urgent need for a new compact between global banks and the society they serve".

"A compact that ensures the benefits of good economic times flow not just to bankers but to the people they serve; that makes sure that the financial sector fosters economic growth."

Various proposals to reform the sector "deserve examination", they said, but a one-off tax on high bonuses paid to bankers "should be considered a priority".

"People rightly want a post-crisis banking system which puts their needs first. To achieve that, nothing less than a global change is required," the leaders wrote.

France and the UK have been at odds recently over European banking.

Mr Sarkozy appeared to boast that the appointment of Frenchman Michel Barnier to oversee European banking reform was a defeat for Britain.

Mr Sarkozy told Le Monde newspaper the British were "the big losers" in the share-out of EU jobs.

Mr Sarkozy and Mr Brown cancelled a meeting last week but are set to meet on Thursday on the sidelines of the EU summit.

On Wednesday, Mr Darling announced plans for a one-off supertax of 50% on banker bonuses, to be applied to payments over £25,000.

The new tax - which would be paid by banks and not individuals - is designed to discourage institutions from paying large bonuses to employees in the wake of the major taxpayer support they have received in the financial crisis.

Afghan violence will rise, says Petraeus

By Phil Stewart and Susan Cornwell

Washington - Violence in Afghanistan will likely climb in the short-term, along with internal government turmoil, US General David Petraeus told Congress on Wednesday, urging lawmakers to reserve judgment for a full year on President Barack Obama's new war strategy.

Petraeus, who as head of US Central Command is in charge of drawing down forces in Iraq and overseeing a new surge of 30 000 US troops in Afghanistan, said he expected increased fighting in Afghanistan in the spring and the summer.

He also said the Afghan government's expected moves to combat corruption likely would result in "greater turmoil within the government as malign actors are identified and replaced".

"It will be important, therefore, to withhold judgment on the success or failure of the strategy in Afghanistan until next December, as the president has counselled," Petraeus said.

Petraeus, who in his previous role as the top Iraq commander oversaw a surge of forces in 2007 that was credited with helping pull that country back from the brink, cautioned that progress in Afghanistan would not be as quick as in Iraq.

"Achieving progress in Afghanistan will be hard and the progress there likely will be slower in developing than was the progress achieved in Iraq," Petraeus said.

The general, a favourite among Republicans who had a high public profile under former president George Bush, was the latest US official to go before Congress to defend Obama's new war strategy announced last week.

Petraeus expressed his full support for Obama's plan and called success in Afghanistan "necessary and attainable".

All of the additional 30 000 US forces are expected to be deployed by the summer or fall, aiming to reverse Taliban momentum and allow for a gradual withdrawal starting in July 2011, according to Obama's plan. The United States already has about 68 000 troops in Afghanistan. - Reuters

Report: Nigerian police killing civilians

MICHELLE FAUL

Associated Press Writer= JOHANNESBURG (AP) — Beware of police roadblocks in Nigeria: If you cannot pay a bribe, you can land up dead, according to an Amnesty International report published Wednesday.

It highlights a new danger in a country regularly denounced as one of the most corrupt in the world, where bribe-taking long has been a way for poorly paid government workers to make ends meet.

Nigeria's police force is poorly paid and trained, and short of essential tools including bulletproof vests, fuel, even paper and pens, Amnesty said. But there appears to be no shortage of the bullets its officers use to kill people they are supposed to protect, the report said.

"In a country where bribes guarantee safety, those who cannot afford to pay are at risk of being shot or tortured to death by the police," it said.

Emmanuel Ojukwu, the national police spokesman, told The Associated Press that "extrajudicial killing is not approved in Nigeria."

He said officers who use unlawful force are arrested, prosecuted and sanctioned. But he could not say how many officers have been dismissed or jailed.

Amnesty International said its research, conducted over three years, indicates officers suspected of unlawful killings are "sent on training" or transferred to other areas. It said there are few prosecutions and it condemned a "culture of impunity."

No one can say how many people are summarily killed by Nigerian police, but the report put it at hundreds each year.

"Many unlawful killings happen during police operations. In other cases, the police shoot and kill drivers who fail to pay them bribes at checkpoints," the report said. "Some are killed in the street because, as the police later claim, they are 'armed robbers'; others are killed after arrest, allegedly for attempting to escape. Many disappear in police custody and are likely to have been extrajudicially executed."

Turkey mulls closure of Kurdish party

ANKARA: Turkey’s highest court on Tuesday began hearing a case to shut down the main pro-Kurdish party on charges of backing PKK rebels, a verdict which could ruin government efforts to boost rights for minority Kurds.

There have been protests and shootings ahead of a ruling by the Constitutional Court, which could decide to disband the Democratic Society Party (DTP), the largest pro-Kurdish party in Turkey’s Parliament.

A verdict to close the party could undermine Prime Minister Tayyip Erdogan’s AK Party’s drive to improve rights of Kurdish citizens, aimed at ending a long-running conflict with Kurdish separatists.

PKK guerrillas have fought for 25 years for a Kurdish homeland in southeastern Turkey. About 40,000 people have died in the violence.

Investors in Turkey, an EU-candidate country, worry the court ruling may raise political instability ahead of a general election set for 2011 and at a time when the economy has begun crawling back from a steep recession. “A verdict to close down DTP will lead to nothing but chaos,” wrote Okay Gonensin, a columnist in the liberal Radikal newspaper.

Several pro-Kurdish parties have been banned in the past.

The case to close down the DTP was brought by Turkey’s Chief Prosecutor Abdurrahman Yalcinkaya, who tried unsuccessfully to close down Erdogan’s party in 2008 on grounds it contravened the country’s secular constitution.

Judges among the 11-member court have told Reuters they want to reach a verdict in the next two weeks. The EU has criticized the lawsuit against the DTP, warning Turkey that banning the party would violate Kurdish rights, and analysts fear it would strengthen the hand of the militant Kurdistan Workers’ Party (PKK) separatist group.

“If the party is closed down, the influence of the PKK in the Kurdish issue will increase. Nine Kurdish parties have been shut so far, but PKK activity in the area has always continued,” said Gonensin.

Leaked climate draft sparks anger

Developing nations taking part in the United Nations climate change conference in Copenhagen have criticised a leaked document which proposes that more power be granted to rich nations.

The document, which was leaked on Tuesday by The Guardian, a British newspaper, also suggests that the UN's negotiating role should be sidelined and that the legally-binding Kyoto protocol be abandoned.

The Guardian reported that the text was drawn up by representatives of a small group of rich nations. The US, UK and Denmark are thought to be among those involved in the drafting of the proposals.

Developing countries have said that the text is part of a plan by rich nations to set unequal limits on carbon emissions in 2050, according to a confidential analysis of the proposals that The Guardian also obtained.

Alan Fisher, Al Jazeera's correspondent in Copenhagen, said leaks are made because people want to make certain positions public.

"There are two possible reasons for the leak. One is that Western nations were saying - this is our bottom line, these are the draconian measures we are prepared to take to safe-guard our interests," Fisher said.

"Or it could have been the developing nations saying - if you are even considering anything like this, there is going to be a revolt you have never seen the like of before.

"The Danes are not denying that the document exists, but they are saying it doesn't carry any official weight at all."

Unequal emissions target

The analysis says that the text worked on by rich nations is a strategy to get developing countries to agree to specific emission cuts, the newspaper reported.

The text seeks to set a limit on developing nations that would not allow them to emit more than 1.44 tonnes of carbon per person by 2050 - while developed nations will be allowed to discharge 2.67 tonnes per head.

The draft is also understood to call for handing control of climate change finance to the World Bank.

Waldon Bello, the director of "Focus on the Global South", a non-governmental organisation specialising in policy research, said that the text was evidence of a "betrayal" on the part of rich nations.

"This is a terrible document - the idea that there would be differential limits put on emissions to favour the north [and] the fact that there would be abandonment of the only legitimate framework, which is the Kyoto Protocol," he said.

"This is not what developing countries were expecting. They were expecting the north to make a serious offer and this is definitely not a serious offer at this point in time. This shows that there is just no 'give' when it comes to the north."

Funding gap

On the same day that the text was leaked, a senior Chinese negotiator told reporters in Copenhagen that the US's emissions target was not notable, that the EU's was not enough, and that Japan's came with impossible conditions.

He also criticised talk of developed nations contributing $10bn annually to poor countries to help them cope with climate change, saying that more money is needed.

Estimates of how much it would costs to enact a climate change plan vary widely. Nicholas Stern, the British government adviser on climate change, says developing countries could use $130bn dollars per year. The bulk of it, $75bn, would be spent on coping with the effects of climate change, with another $40bn going towards research and development of greener technologies and $15bn for forest conservation. Those estimates are much lower than those given by the World Bank, which reports that poor countries would need $550bn dollars a year - including $400bn for technology development and $150bn to cope with the effects of climate change. If global temperatures are to rise no more than two degrees Celsius by 2050, the International Energy Agency says $10 trillion of energy-related investments will have to be made over the next two decades.

Source: Al Jazeera and agencies

AP sources: Dems reach deal to drop gov't-run plan

DAVID ESPO

AP Special Correspondent= WASHINGTON (AP) — After days of secret talks, Senate Democrats tentatively agreed Tuesday night to drop a government-run insurance option from sweeping health care legislation, several officials said, a concession to party moderates whose votes are critical to passage of President Barack Obama's top domestic priority.

In its place, officials said Democrats had tentatively settled on a private insurance arrangement to be supervised by the federal agency that oversees the system through which lawmakers purchase coverage. Additionally, the emerging agreement calls for Medicare to be opened to uninsured Americans beginning at age 55, a significant expansion of the large government health care program that currently serves the 65-and-over population.

At a hastily called evening news conference in the Capitol, Majority Leader Harry Reid, D-Nev., declined to provide details of what he described as a "broad agreement" between liberals and moderates on an issue that has plagued Democrats' efforts to pass health care legislation from the outset.

With it, he added, the end is in sight for passage of the legislation that Congress has labored over for months.

The officials who described the details of the closed-door negotiations did so on condition of anonymity, saying they were not authorized to discuss them publicly.

At its core, the legislation would expand health care to millions who lack it, ban insurance companies from denying coverage on the basis of pre-existing medical conditions and rein in the rise of health care spending nationally.

The developments followed a vote on the Senate floor earlier in the day in which abortion opponents failed to inject tougher restrictions into sweeping health care bill, and Democratic leaders labored to make sure fallout from the issue didn't hamper the drive to enact legislation. The vote was 54-45.

Taken together, the day's developments underscored the complexity that confronts the administration and Reid as they seek the 60 votes needed to overcome Republican opposition and pass a bill by Christmas. Despite their reluctance, some senators had talked openly and in detail earlier in the day about the progress of the negotiations.

The provision in the legislation to be dropped under the emerging agreement provides for a government-run insurance option to be available to consumers, with individual states permitted to drop out. Liberals have long sought such as arrangement, as a means of forcing competition on insurance companies.

One participant in the talks, Sen. Tom Harkin, D-Iowa, told reporters he didn't like the deal, but he added, "I'm going to support it to the hilt" in hopes of securing passage of the health care bill.

Another senator involved, Sen. Russ Finegold, D-Wis., issued a statement saying, "I do not support proposals that would replace the public option in the bill with a purely private approach. We need to have some competition for the insurance industry to keep rates down and save taxpayer dollars." But he did not rule out voting for the measure.

In his comments to reporters, Reid said the emerging compromise "includes a public option and will help ensure the American people win in two ways: one, insurance companies will face more competition, and two, the American people will have more choices."

It wasn't clear what he meant by a "public option," the Medicare expansion or another as yet unknown element.

It was unclear, for example, what fallback steps would be included in case private insurance companies declined to participate in the nationwide plan envisioned to be overseen by the Office of Personnel Management. One possibility was for the agency to set up a government-run plan, either national in scope or on a state-by-state basis, but no confirmation was available.

Under the tentative agreement, liberals lost their bid to expand Medicaid, the federal-state program that provides health care for the poor, elderly and disabled. But they prevailed on the Medicare expansion, and the negotiators appeared ready to maintain a separate health care program for children until 2013, two years longer than the bill currently calls for, according to officials familiar with the details.

Additionally, there was consensus support for a requirement long backed by Sen. Jay Rockefeller, D-W.Va., and other liberals for insurance companies to spend at least 90 percent of their premium income providing benefits, a step that supporters argue effectively limits their spending on advertising, salaries, promotional efforts and profits.

127 Iraqis killed in spate of deadly bombings in Baghdad

Baghdad, December 09: Five powerful car bombs rocked Baghdad on Tuesday, killing at least 127 people, many of them students, and wounding 448 in the third co-ordinated massacre to devastate the capital since August.

The attacks came hours before the Iraqi presidency council fixed a new date for the country's crucial parliamentary elections on 6th March.

The first attack occurred at about 10:25 a.m. (0725GMT) when a car loaded with explosives went off at the park of the new seat of the Finance Ministry after a massive truck bombing on 19th August badly damaged its original building in Waziriya district.

Seconds later, another car bombing took place near an intersection close to the Interior Ministry in eastern Baghdad, while a third car bombing detonated in the park of a court near the Institution of Fine Arts in Baghdad's western district of Mansour.

The bombing at the court building apparently targeted the part of the building occupied by the federal court which moved recently from its original place in the building of the Justice Ministry in Salhiyah which was destroyed by a massive truck bombing on 25th October.

A minute later, a fourth car bombing carried out by a minibus loaded with explosives went off at the intersection of the Nidaa mosque, near the Ministry of Labor and Social Affairs in the al-Qahira neighborhood in northeastern Baghdad.

The powerful blast destroyed dozens of civilian cars which were crowded at the intersection.

"I saw dozens of cars were charred and many bodies were scattered at the site and some parts of human bodies were thrown on the roofs of nearby buildings," Jamal al-Obiedi, a witness at the scene said.

Footage of the Iraqi local television al-Sharqiya showed the finance ministry bombing destroyed parts of its building and many old houses in the nearby impoverished neighborhood were damaged.

A total of 112 people were killed and 425 wounded by the four coordinated bombings in Baghdad, the Interior Ministry said in its latest toll reports.

Earlier in the day, a suicide bomber drove his explosive-laden car into a police patrol in Baghdad's southern district of Doura, killing 15 people, including three policemen, and wounding 23 people.

The latest wave of deadly bombings is the third of such attacks since 19th August when suicide truck bombings struck the ministries of foreign affairs and finance, and the attacks on 25th Oct when insurgents hit the buildings of Baghdad Provincial Council and the Justice Ministry.

The attacks came hours before the Iraqi Presidency Council announced that 6th March, 2010 is the date of holding the crucial parliamentary elections in the country.

The presidency decision came two days after Iraqi lawmakers unanimously agreed on controversial amendments on the electoral law that would govern the war-torn country's national elections.

Originally, the election was slated for 16th January, but months of debate among Iraqi politicians to pass the amendments needed to the law in an attempt to reform the elections process to make it more representative for Iraqis inside and outside the country.

Iraqi Prime Minister Nuri al-Maliki condemned Tuesday's bloody attacks, renewing his accusation to the remnants of Saddam Hussein's Baath party and the al-Qaida militants for committing such deadly attacks.

"The terrorist gangs backed by both remnants of Baath party outside Iraq and al-Qaida, committed another massacre carrying the same black fingerprints which have always plunged into the blood of innocents," Maliki said in a statement issued by his office in the afternoon.

Maliki also said that the attacks came after the Iraqi parliament succeeded in passing the last stumbling block toward the country's landmark elections, confirming that "Iraq's foes are only aimed at inciting chaos in the country and halting any progress in the political process."

The number of deaths by violence in the war-ravaged country had dropped to its lowest level in November since the U.S.-led invasion in 2003, when official monthly figures showed that 122 people had been killed in the country.

Jerusalem should be joint capital: European Union

Brussels, December 09: European Union foreign ministers urged Israel and the Palestinians on Tuesday to make Jerusalem their shared capital, prompting a swift, angry reaction from Israel.

For their part Tuesday, the Palestinians announced a boycott of products made in Israeli settlements in the West Bank. Palestinian Economics Minister Hassan Abu Libdeh said the government has already confiscated $1 million worth of products, including foods, cosmetics and hardware, and that he hoped to remove all such goods from Palestinian store shelves next year.

In Brussels, EU foreign ministers reiterated that the 27-member bloc would not recognize Israel’s annexation of the eastern part of Jerusalem after it occupied it in the 1967 war. The ministers called for Israel to share Jerusalem as a capital with a future Palestinian state.

Although the EU has long opposed the annexation of east Jerusalem, the statement angered Israel and was sure to deepen Israel’s sense that the Europeans favor Palestinian positions. President Barack Obama has been trying, so far in vain, to nudge the sides toward renewed peace talks.

‘The EU will not recognize any changes to the pre-1967 borders including with regard to Jerusalem, other than those agreed by the parties,’ said the ministerial statement. It was referring to the Mideast war in which Israeli forces captured east Jerusalem from the Jordanian army.

‘If there is to be a genuine peace, a way must be found (through negotiations) to resolve the status of Jerusalem as the future capital of two states,’ it said.

The EU ministerial statement dropped an earlier Swedish draft resolution which explicitly stated that east Jerusalem — the disputed part of the holy city — should be the capital of a Palestinian state after Israel warned it would damage the bloc’s ability to take part in any resumed peace talks as a negotiator.

The Israeli Foreign Ministry reacted immediately. ‘We regret that the European Union chose to adopt the text,’ Israeli Foreign Ministry spokesman Yigal Palmor said in a statement. He said the statement ‘does not contribute’ to promoting peace and ignores the Palestinians’ refusal to resume talks.

Palestinian President Mahmoud Abbas refuses to resume peace talks, which broke down a year ago, unless Israel halts all settlement construction.

The Palestinian prime minister, Salam Fayyad, welcomed Tuesday’s EU statement. He said it gives Palestinians ‘a better sense of hope and possibility about tomorrow.’

The competing claims to east Jerusalem remain perhaps the most explosive issue in the Israeli-Palestinian conflict.

East Jerusalem is home to sensitive Jewish, Muslim and Christian holy sites. The most contentious is the disputed hilltop compound known to Jews as the Temple Mount and to Muslims as the Noble Sanctuary. Temple Mount, home to the biblical Jewish Temples, is the holiest site in Judaism. It also is the site of the Al Aqsa Mosque, the third-holiest site in Islam.

Palestinians have complained that Israel is trying to restrict their numbers in the eastern part of the city.

Some EU ministers supported the original Swedish proposal but others said it would risk undermining efforts to restart peace talks. Swedish Foreign Minister Carl Bildt said after the meeting: ‘We call on the Israeli government to cease all discriminatory treatment of the Palestinians in east Jerusalem.’

The ministers took ‘positive note’ of Israel’s recent decision to implement a temporary freeze on building new homes in West Bank settlements — a decision that angered the Palestinians by excluding east Jerusalem.

But they emphasized that the settlements and a separation barrier Israel has built are on occupied land and that Israel’s evictions and the demolition of Palestinian homes in east Jerusalem were illegal under international law.

The resolution said such Israeli actions ‘constitute an obstacle to peace and threaten to make a two-state solution impossible.’

The Palestinians have dismissed the Israeli’s temporary building freeze as insincere because it excludes east Jerusalem and 3,000 homes already being built in the West Bank. Some 300,000 Israelis live in the West Bank, in addition to 180,000 Jewish Israelis in east Jerusalem.

Meanwhile Tuesday, the Palestinians’ economics minister, Abu Libdeh, defended the Western-backed government’s decision to remove settlement-built products from Palestinian stores. ‘Consuming settlements’ products is wrong, nationally, economically, politically, and must stop right away,’ he told a news conference.

Fully implementing the boycott will be a challenge since the Palestinian economy relies heavily on Israeli manufacturers for many basic goods.