Extracts.
 
China, Turkmenistan Mark 10th Anniversary of Bilateral Ties.

The leaders of China and Turkmenistan on Sunday exchanged messages of
congratulation on the occasion of the 10th anniversary of the establishment
of diplomatic ties between the two countries.

The leaders of China and Turkmenistan   on Sunday exchanged messages of
congratulation on the occasion of the 10th anniversary of the establishment
of diplomatic ties between the two countries.

Ever since China and Turkmenistan established diplomatic ties in 1992, the
two countries have forged good state-to-state relations based on mutual
respect, mutual trust and mutual understanding in accordance with the Five
Principles of Peaceful Coexistence and other internationally-recognized
norms governing international relations, said Chinese President Jiang Zemin
<http://english.peopledaily.com.cn/data/people/jiangzemin.shtml>  in his
message. 

The Chinese leader also expressed his appreciation of the Turkmen
government's consistent support to China in dealing with the Taiwan
question and fighting against separatism.

The cooperation based on mutual benefit between the two countries in the
fields of economy, trade and energy has been fruitful, Jiang said, adding
that such cooperation enjoys great potential and broad prospects due to the
strong complementarity between the two economies.

It is in the fundamental interests of the two peoples to maintain and
develop the good-neighborly ties based on friendship and cooperation, which
will also contribute to regional peace and development, said the Chinese
president. 

In his message, Jiang pledged to work together with the Turkmenside for the
further development of bilateral friendship and cooperation in the new
century. 

Meanwhile, Turkmen President Saparmurad Atayevich Niyazov said in his
message that the two countries hold similar or identical positions on major
strategic issues concerning global development and Asian affairs as both
countries cherish peace, equality and justice and respect state sovereignty,
human rights and national dignity.

It is of realistic significance for the two countries to hold a common stand
on combating extremism and terrorism carried out under the disguise of
practicing religion, belief and democracy, said the Turkmen leader.

He called on the international community to coordinate with and help each
other in fighting such evil forces and eradicating their activities, thus
paving the way for enhancing mutual understanding and constructive
cooperation among countries. He also urged international organizations,
including the United Nations, to engage themselves in such causes.

During the past 10 years, Turkmenistan and China have witnessed continuous
consolidation and development of their economic and trade ties, Niyazov
said, adding that the long-term cooperation between the two sides is based
on equality, mutual benefit, mutual understanding and taking into account
each other's interests.

Chinese Foreign Minister Tang Jiaxuan  also sent greetings to his Turkmen
counterpart, Rashid Meredov, on the occasion.

****


Taliban Envoy Back to Afghanistan: Pak Spokesman.

Former Taliban Ambassador to Pakistan Mullah Abdul Salam Zaeef has crossed
over to Afghanistan since Pakistan has turned down his request for political
asylum, Pakistani Foreign Office spokesman Ziz Ahmed Khan said in Islamabad
on Saturday. 


Former Taliban Ambassador to Pakistan   Mullah Abdul Salam Zaeef has crossed
over to Afghanistan  since Pakistan has turned down his request for
political asylum, Pakistani Foreign Office spokesman Ziz Ahmed Khan said
here on Saturday. 

Aziz told a briefing that Pakistan had rejected the request of Mullah Zaeef
who sought political asylum in Pakistan after the fall of Taliban in
Kandahar in the first week of December last year.

"He has gone to Afghanistan and he is no more inside Pakistan,"Khan said
while responding to a number of questions about whereabouts of Zaeef.

It was reported earlier that Zaeef was detained from his residence in
Islamabad and brought to Peshawar, a northwest city near Pak-Afghan border
by the Pakistani police on Thursday.

****




Indian PM: No Discussion With Musharraf on Indo-Pak Tension.

Indian Prime Minister Atal Bihari Vajpayee Sunday said he did not discuss
with Pakistan President Pervez Musharraf any steps to defuse tension between
India and Pakistan during their brief "informal interaction" afterthe close
of the South Asian Association for Regional Cooperation (SAARC) summit in
Kathmandu. 

Indian Prime Minister Atal Bihari Vajpayee Sunday said he did not discuss
with Pakistan  President Pervez Musharraf any steps to defuse tension
between India and Pakistan during their brief "informal interaction"
afterthe close of the South Asian Association for Regional Cooperation
(SAARC) summit in Kathmandu.

Vajpayee, who arrived here from the Nepalese capital, made these remarks
when asked by reporters whether the stand-off between the two countries came
up at the interaction.

Asked to elaborate on the meeting, Vajpayee said, "we exchangedgreetings,
enquired about each other. There is nothing worth narrating."

He also said he would "definitely" participate in next year's SAARC summit
to be held in Pakistan if the situation between the two countries normalizes
by then. 



****
Recession Looming Japan's Economy.

Japan's already stagnant economy, the second largest in the world, looks
even more dismal this year amid a worldwide economic slowdown following the
September terrorist attacks in the United States.

Japan's already stagnant economy, the second largest in the world, looks
even more dismal this year amid a worldwide economic slowdown following the
September terrorist attacks in the United States.

Bad news and pessimistic outlook for the economic are popular in Japan, with
dwindling GDP (gross domestic product), hiking unemployment, reduced
investment, job cuts, insolvent banks, and so on.

Earlier this month, the Japanese government announced Japan's GDP shrank by
0.5 percent in the third quarter of this year, or an annualized decline of
2.2 percent, the second consecutive quarterly shrinkage following a 1.2
percent contraction in the previous quarter.

The announcement officially confirmed that the Japanese economy has now slid
into recession, the third recession in a decade. Recession is usually
defined as two consecutive quarters of economic contraction.

Fueling the latest slump, personal consumption, which had played a major
role in keeping the economy from an unchecked plunge, dipped substantially
in the quarter. 

The dwindling personal consumption, along with falling prices, point to the
possibility of a dreaded deflationary spiral in which prices plunge amid a
slowing economy. 

The business sentiment also dumps, with the diffusion index of business
sentiment among big manufacturers down to minus 38, according to the latest
Tankan month report by the Bank of Japan ( BOJ). A minus reading means more
firms are more pessimistic than optimistic.

The index of electronics makers and automakers, regarded as the engine of
Japan's economy, hit a 27-year low of minus 63 and a record low of minus 14,
respectively. 

Other accurate figures are certainly appalling, with industrial production
down at an annual rate of 15 percent in the first half of the year, exports
falling at an annual rate of nine percent over the same period while
machinery order tumbling at an annual rate of 20 percent in the third
quarter. 

Unemployment situation was severe, with the jobless standing at a record
high of 5.4 percent in October after renewing the record once again in the
previous months. 

Japan's economic downward drift is certainly partly due to the spreading
impact of the September 11 terrorist attacks and the U.S. economic
recession, the first in a decade for the U.S.

Industrial output and exports have slowed after the September 11 terrorist
attacks, while the rising jobless rate and the mad- cow disease scare are
dampening consumer confidence.

But the root for Japan's problems lies in its own, namely, its failure to
address the structural problems in the past and the lagging structural
reforms, as the Organization for Economic Co- operation and Development
(OECD) put it. 

One of the long-standing problems came from its banking sector, which has
consistently failed to deal properly with bad loans.

As of the end of September, Japan's 14 banks' outstanding bad loans totaled
20.69 trillion yen (166.8 billion U.S. dollars) under the strict disclosure
standards required by the financial- system revival law.

Another most worrying problem facing Japan is deflation, with prices falling
close to one percent a year. Yet, Japan's policy makers seem incapable to
respond to the dangers posed by prolonged deflation.

The future course of the Japanese economy looks dim.

On December 19, Japanese government officially adopted a projection of zero
economic growth in real terms for fiscal 2002, turning in its lowest-ever
growth target for a coming fiscal year but still avoiding a negative
forecast. 

Japan's GDP will shrink 0.9 percent in nominal terms to 496.2 trillion yen
(3.87 trillion dollars), according to the forecast.

The International Monetary Fund, however, predicted that Japan' s economy
will shrink by nearly one percent this year and 1.3 percent next year.

The OECD forecast the economy to shrink by 0.75 percent this year, and by a
further one percent next year.

Economic shrinkage will bedevil Japan through early 2004, according to a
forecast earlier this month, released by Japan's Council on Economic and
Fiscal policy. 

Ordinary Japanese also shared this fear. During a survey conducted by the
Nippon Research Institute, 72 percent out of the 1,500 said they feared to
lose their jobs next year.

With the economic recession, this year's winter season will be a chilling
one for many Japanese.

****



Saddam Defies US Military Threat in Annual Army Day Address.

Iraqi President Saddam Hussein struck a defiant note in his annual Army Day
address on Sunday whenhe vowed to thwart any fresh military attacks by the
United States. 

Iraqi President Saddam Hussein struck a defiant note in his annual Army Day
address on Sunday whenhe vowed to thwart any fresh military attacks by the
United States . 

"As your debased enemies failed in the past, so will any aggressor, if he
lets himself be seduced into committing an evil act against your trust. He
... will be thwarted in his base aims," Saddam said in a speech carried by
the official Iraqi News Agency (INA).

While admitting that the Iraqi army is standing "a glorious test," Saddam
said "obstacles facing the march will be nothing but lessons that deepen
faith and determination, increase resolution, and enlarge horizons for
optimism and confidence in success."

Saddam praised the "proud, faithful and striving" army of Iraq, and
expressed confidence that the army "will remain loyal to the interests of
the people, jealous of the sovereignty and dignity of the homeland."

Saddam also blasted the "hateful" embargo imposed for Iraq's 1990 invasion
of neighboring Kuwait.

The annual speech of the Iraqi strongman came amid widespread speculation
that the U.S. may expand its war on terrorism from Afghanistan to Iraq.

U.S. President George W. Bush strongly hinted last November thatthe U.S.
might target Iraq after Afghanistan by demanding Saddam toallow the United
Nations arms inspectors back into the country or face the consequences.

Some U.S. officials have been clamoring for attacking Iraq for its suspected
development of weapons of mass destruction in the absence of U.N. arms
inspectors. 

U.N. weapons inspectors have been barred from re-entering Iraq since they
withdrew from the country before U.S.-British military strikes against Iraq
in December 1998. 

Saddam has remained adamant in the face of the latest U.S. threats and vowed
to reject the resumption of international arms inspections.

In a telegram to Saddam on the eve of the Army Day, Iraqi Defense Minister
Sultan Hashem Ahmed vowed to defend Iraq from any possible attacks. "We are
confident in our capabilities to confrontwhoever dream to harm our country,"
Ahmed said. 

****


Kathmandu Summit Revitalizes SAARC Process.

The 11th summit of the South Asian Association for Regional Cooperation
(SAARC) concluded here Sunday. Of all the achievements, the summit has
helped revitalize the regional body's process which has already been bogged
into a stillness for more than three years.

This time, though it seemed overshadowed again by new tensions between
India, all the leaders, with overall regionalinterests in mind, came
together and worked hard to reach consensus in accelerating the SAARC's
activities in order to strengthen socio-economic cooperation and address the
most urgent,difficult problems in the region -- poverty eradication,
trafficking of women and children, trade barriers and terrorism.

In the Kathmandu Declaration adopted at the conclusion of the summit, the
leaders "solemnly renewed their pledge to strengthen the Association and
make it more cohesive, result oriented and forward looking."

In particular, they decided to speed up the free trade process by finalizing
a draft treaty by the end of 2002, so as to move more quickly towards a
South Asian Free Trade Area (SAFTA), which would remove non-tariff barriers
and structural impediments and lower tariffs to greatly enhance trade and
investment among SAARC countries.

Back in 1995, with the aim to realize SAFTA, the seven SAARC nations --
Nepal, Bhutan, India, the Maldives, Pakistan, Sri Lanka and Bangladesh  --
reached an agreement on South Asian PreferentialTrading Arrangement (SAPTA),
under which more than 2,000 items of products are being traded for
preferential treatment among them.

The benefit of this move is more than evident, just as Indian Prime Minister
Atal Bihari Vajpayee summed up at the summit, "In an intensely competitive
world, regional economic groups create obvious economies of scale. At times
of wider recession, regional trade can cushion their adverse impact."

In fact, the SAARC decided on its ninth summit in the Maldives in 1998 to
establish SAFTA by 2001. However, the process was unfortunately delayed as
almost all the SAARC activities came to astop due to escalating nuclear
tests by India and Pakistan, the two biggest economies in the group.

Now with the SAARC becoming more business-oriented, the member countries
would quicken their steps in the direction. "Although there is no time frame
yet for SAFTA, it is encouraging that the process is restarted," said Ram
Mahat, Nepali finance minister.

South Asia remains one of the poorest regions in the world, with 40 percent
of its 1.3 billion people (accounting for one fifth of the world population)
living below the poverty line, and its share of global gross products less
than two percent. 

On the alleviation of poverty -- the most formidable developmental challenge
for the region, the leaders this time tried to stop high talking and pledged
to come down to practical measures. They directed both the SAARC Secretariat
and the SAARC Council of Ministers to work out effective, sustained and
attainable anti-poverty programs. It seems the programs would be practical
and could be implemented in a fixed time frame.

Another important achievement of this summit is the signing of two
conventions, one on combating the crime of trafficking of women and children
for prostitution and the other on regional arrangements for the promotion of
child's welfare. Under these documents, concrete steps would be taken to
empower and protect women and children in the region, where trafficking of
them has long been a lingering social evil.

Meanwhile, all the leaders committed themselves to fighting terrorism in a
comprehensive and collective manner at the present time when terrorism is
ever threatening. The SAARC nations have accepted U.N. Resolution 1373 as
the basis for future actions against terrorism, and are determined to
"redouble efforts, collectively as well as individually, to prevent and
suppress terrorism," the declaration said.

All in all, the most important success of the summit, as political analysts
have noticed, is that the leaders bypassed their disputes and came together
to revitalize the region's development and cooperation. Their efforts are
essential to the social advancement, economic prosperity, peace and
stability, not only of the South Asian region, but even of the world at
large. 

SAARC Leaders Vow to Wage Sustained Fight Against Terrorism
The fight against terrorism inall its forms and manifestations has to be
comprehensive and sustained, declared leaders of the South Asian Association
for Regional Cooperation (SAARC) members.

In the Kathmandu Declaration issued at the end of the two-day 11th SAARC
summit, the leaders reiterated their support to U.N. Resolution 1373 of
September 28, 2001.

They said they are determined to "redouble efforts, collectively as well as
individually, to prevent and suppress terrorism."

In the document, they also reaffirmed their commitment to the SAARC Regional
Convention on Suppression of Terrorism which was passed in 1987 in Kathmandu
and expressed their aspiration to "accelerate the enactment of enabling
legislation within a definitetime-frame" for its full, early and effective
implementation. 

Meanwhile, they called upon the international community to assist SAARC
members to deal effectively with the adverse economiceffects of terrorism
and to help meet the rising insurance and security related costs.

They stressed that terrorism violates the fundamental values ofthe United
Nations and the SAARC Charter and constitutes one of the most serious
threats to mankind.

Terrorism, they declared, "cannot be justified on ideological, political,
religious or on any other ground," and must be suppressed for the sake of
safeguarding "international peace and security in the twenty-first century."

The SAARC, established in 1985 for regional cooperation and integration,
groups seven South Asian countries -- Nepal, Bhutan, India, the Maldives,
Pakistan, Sri Lanka and Bangladesh.





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