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At least 48 people are now known to have died in a suspected outbreak of Ebola in the north of Congo-Brazzaville, near the border with Gabon.

There is no cure for Ebola, which causes up to 95% of its victims to bleed to death.

The authorities in Brazzaville have not yet been unable to confirm the virus is the cause of the deaths.

But the ministry of health says it has now obtained blood samples from five of the deceased.

At first inhabitants of the villages of Kelle and Mbomo where people have been dying daily in recent weeks, refused to co-operate with emergency teams from the ministry of health and the World Health Organisation (WHO), sent to investigate a possible Ebola outbreak.

Instead they accused the health teams of bringing the virus to the area themselves, and refused to give blood samples from their dead.

Wild game

The samples have been sent from Kelle and Mbomo, 800 kilometres north of the capital, Brazzaville, to a laboratory in Libreville, Gabon, and results of the Ebola tests are expected within the next five days.

. .Doctors say the virus can spread through infected bush meat .

In the meantime, the ministry of health and the WHO are treating the deaths as a confirmed Ebola outbreak and taking measures to contain the spread of the virus, which is easily passed by contact with body fluids and between humans and animals.

The ministry says its emergency teams have now succeeded in convincing inhabitants of the area to stay away from church and not to travel.

The teams are also trying to stop people in the region from eating wild game such as gorilla, gazelle and antelope.

These are among the animals which have been dying off in the surrounding forest and have already tested positive for Ebola.

Ebola killed 43 people in Congo and 53 others in neighbouring Gabon between October 2001 and February 2002.

The WHO says more than 1,000 people have died of Ebola since the virus was first identified in 1976 in western Sudan and in a nearby region of Congo.

The European Union has renewed its sanctions against Zimbabwe for a further 12 months, but will allow President Robert Mugabe to travel to a summit in Paris next week.

I find it extraordinary that EU ambassadors have had to spend time finding a way of allowing avoidance of their own sanctions Geoffrey van Orden UK Conservative Party spokesman

At a meeting in Brussels on Wednesday, diplomats agreed to a temporary "opt-out" for France, which is hosting a meeting of Franco-African leaders on human rights.

The current measures include a ban on President Robert Mugabe and 71 of his officials travelling to Europe, because of concerns about political repression and human rights abuses.

The Commonwealth looks set, however, to end its suspension of Zimbabwe after Nigeria and South Africa argued that the situation had improved in the past 12 months.

Nigeria, South Africa and Australia were charged with monitoring events in Zimbabwe on behalf of the grouping of former British colonies.

Nigerian President Olusegun Obasanjo has written to Australian Prime Minister John Howard, saying that Mr Mugabe's controversial land redistribution programme is now proceeding normally.

Both sets of sanctions were imposed a year ago, around the time of the presidential elections.

Mr Mugabe was accused of using violence and fraud to ensure his re-election.

Constructive engagement

France had opposed extending the travel ban, and African countries had warned they would not go to Paris without Mr Mugabe.

France believes it is better to engage Mr Mugabe in dialogue, but several other EU members, including the UK, say he should not be allowed into Europe at all.

ZIMBABWE SANCTIONS

US travel ban, asset freeze EU travel ban, asset freeze Commonwealth - suspended, until March

Mugabe outfoxes his critics

Geoffrey van Orden, human rights spokesman in the European parliament for the UK Conservative Party condemned the decision in view of the current trial of opposition Movement for Democratic Change (MDC) leader Morgan Tsvangirai.

"I find it extraordinary that, at the very moment when yet another Zimbabwe opposition MP has been arrested and the opposition leader is on trial facing the most dubious of treason charges, EU ambassadors have had to spend time finding a way of allowing avoidance of their own sanctions," he said.

A meeting between EU leaders and members of the African-Caribbean-Pacific group due to take place in Lisbon has also been threatened by the same arguments.

Diplomats say that this summit is likely to be postponed.

The 72 Zimbabwean leaders have also had any assets in the EU frozen.

The MDC has condemned Nigeria and South Africa for opposing renewed Commonwealth sanctions.

"This letter [Obasanjo's] speaks the language of Zanu-PF," said MDC foreign secretary Moses Mzila Ndlovu, referring to Zimbabwe's ruling party.

He pointed to the arrests of journalists and opposition lawmakers and the alleged partisan distribution of food aid among the hungry as reasons for keeping Zimbabwe out of the Commonwealth.

The Australian prime minister is also opposed to readmitting Zimbabwe to the Commonwealth.

'Normal process'

After a recent visit to Harare, Mr Obasanjo wrote to John Howard that the land reform programme had been "acclaimed as remarkable".

. . Mugabe's supporters have been occupying farms .

"It is now a matter of reality that the Fast-Track land resettlement programme, adopted by the Government of Zimbabwe... has substantially ended since August 31, 2002," he said.

"Since then the Land Reform Programme (LRP) has continued to be implemented in the normal regulatory process."

The Nigerian leader noted Mr Mugabe's promise to compensate white farmers who have lost their land but Colin Cloete, president of the Commercial Farmers' Union, said:

"No farmers have had their compensation yet."

He also told BBC News Online that illegal farm invasions were continuing.

Between 600 and 800 white farmers remained on their farms, out of some 4,000 two years ago, he said.

The United States has condemned the Sudanese Government, which it says has violated the ceasefire signed last year with rebels in the south.

A State Department spokesman, Richard Boucher, said the US condemned what he described as "unconscionable attacks and abuses" against civilians in the Western Upper Nile region.

But he added that the Sudanese Government now seemed to be taking steps to adhere to the ceasefire accord.

The US spokesman was responding to a report by a US-led team of international monitors who detailed a number of attacks in southern Sudan in December and January, and the displacement of thousands of civilians.

From the Newsroom of the BBC World Service

The Bolivian president has abandoned plans to introduce a new income tax after violent protests left at least 10 people dead and dozens injured in the capital, La Paz.

Gonzalo Sanchez de Lozado announced his decision after troops and striking police officers fought each other outside the presidential palace.

The government should really have thought before announcing these new taxes - we're just too poor to pay them Sonia Rocha Restaurant owner

"I have decided to withdraw the budget bill that I sent to Congress," he said in a televised address to the nation.

Local media say eight policemen and two soldiers were killed in Wednesday's violence in the impoverished Latin American state.

The trouble appears to have erupted when demonstrators outside the presidential palace threw stones at the windows as police looked on.

The soldiers guarding the building opened fire with tear gas and live bullets, eyewitnesses said.

Tax hike

Unrest began earlier in the week when police units in La Paz refused to go out on patrol over a demand for higher wages.

About 10,000 officers - nearly half of the nation's police force - refused to go on duty.

. . The president appealed for an end to the violence .

The government's announcement of a new income tax of 12.5% - necessary, it said, to reduce the deficit and win IMF support - only added fuel to the fire.

One restaurant owner, Sonia Rocha, denounced the government's economic plans.

"We're living a total chaos," she told the Associated Press news agency.

"The government should really have thought before announcing these new taxes. We're just too poor to pay them."

Unions, employers organisations and opposition politicians have threatened a general strike over President de Lozado's austerity policies.

The BBC's South America correspondent, Tom Gibb, says it is still unclear whether the president's climb-down on Wednesday will be enough to stop a general strike.

The body of a popular Colombian Government minister has been found almost a week after his plane crashed in the Andes mountains.

The bodies are spread over the area and the aircraft is completely destroyed Aviation Direction Juan Carlos Velez

The remains of Juan Luis Londono and the four people travelling with him were located near the town of Cajamarca, 140 kilometres (85 miles) west of the capital Bogota.

"The bodies are spread over the area and the aircraft is completely destroyed," Aviation Director Juan Carlos Velez said, according to the Reuters news agency.

No cause has been announced for the accident.

The BBC's Jeremy McDermott in Colombia says Londono's was the friendliest face in the hardline government of President Alvaro Uribe but that he was also one of the most able ministers.

He presided over the merger of two ministries, those of health and labour.

Disappeared

On 6 February, he was flying across the country to attend a series of meetings but whilst crossing over the Andes the small Piper aircraft he was travelling in disappeared off radar screens over the central province of Tolima.

. . Londono had fought against corruption .

It took rescue services five days to find a trace of the plane and the search was not helped by the fact that Marxist guerrillas in the area opened fire on helicopters looking for Londono.

Sources within the Colombian civil aviation authority has earlier said that the wreckage of the plane was burnt up and scattered over a wide area and that nobody could have survived the impact.

The death of Londono, 44, is a blow to the government.

One of the country's top economists, with a doctorate from Harvard, he had worked tirelessly over the last six months to reform departments riddled with corruption and inefficiency.

By Steve Schifferes BBC News Online, Washington

US lawmakers are threatening to take retaliatory action against France, Belgium and Germany for their opposition to US policy towards Iraq.

Anger with the French and German stand has led some US congressmen to call for a trade boycott of French products and the withdrawal of some US troops from Germany.

The failure of these three states to honour their commitments is beneath contempt Tom Lantos, Democratic congressman

And some consumers are already reducing their purchases of French cheese and wine.

The increased rhetoric and demands for action are a concrete sign of the growing tensions within the Nato alliance.

The bitterness is evident across the political spectrum.

Democratic Congressman Tom Lantos of California said he was "particularly disgusted by the blind intransigence and utter ingratitude" of France, Germany and Belgium.

"The failure of these three states to honour their commitments is beneath contempt," he told Colin Powell as the secretary of state began his testimony to Congress.

Drop in support

Republican Senator John Warner, the chairman of the Armed Services Committee, said that Congress may consider reducing financial support to Nato.

And his counterpart in the House of Representatives, Duncan Hunter, said that Germany's "tears of gladness at the sacrifice Americans have made for their freedom have dried very quickly."

Anything we can do to hurt them without hurting us, I will support Peter King, Republican congressman

He said that the House would now strongly back the plans by the Bush administration to reduce the number of US troops in Germany from the current level of 71,000.

"Anything we can do to hurt them without hurting us, I will support," said Republican congressman Peter King.

Even moderate Democratic Senator Joe Lieberman said that "the tone and volume of their dissent is in danger of drowning out the voice of a nearly united Europe."

Ban request

Meanwhile, the Speaker of the House of Representatives, J Dennis Hastert, has asked Congress to consider banning French exports of wine and bottled water on health grounds.

. . Anti-war sentiment in Europe is causing anger in the USA .

He says that some French wine is clarified using bovine blood, so that Americans could be at risk of getting BSE or "mad cow" disease.

The US is already involved in several bitter trade wars with the European Union, which has banned US exports of genetically modified food on health grounds.

So far, US trade officials are holding off from bringing a case against the EU to the World Trade Organisation - at least partly because the EU is already in a position to slap up to $4bn worth of trade sanctions against the US in another case, but has so far refrained from doing so.

Consumer boycott

Meanwhile, some Americans are taking direct action.

. . European products are under pressure .

Orders at the French cheese website, fromages.com, which gets 80% of its business from the US, have dropped as the site as received many e-mails from angry customers.

"Because of the current position your government is taking on not supporting the U.S. at this time regarding Iraq, we are not going to support France in any way," one e-mail said.

And the president of the French-American Chamber of Commerce, Boris Marchand-Tonnel, warned that US airlines that were getting government support would be reluctant to buy Airbus commercial jets from France.

So far, the movement for a consumer boycott is small, and like the boycott of the French tourist industry in the past, officials are hoping it will be short-lived.

But the bitter words are resonating with the strong but dormant US tradition of avoiding foreign alliances.

In the long run, that mounting disillusionment could make it more difficult for those in the Bush administration who are trying to maintain the integrity of the Nato alliance.

Batteries of anti-aircraft missiles have been set up around Washington amid warnings that a terrorist attack is expected.

Fighter jets are also patrolling the skies around the United States capital after the Pentagon activated increased security.

SAFEGUARDS

In Washington: Anti-aircraft missiles F-16 fighter jets and helicopters Radar In London: 1,500 police and soldiers guarding main airport Roads along flight paths also secured

In Britain, 1,500 armed troops and police were deployed to protect London's Heathrow airport which ministers believe could be a target.

The action follows the release of the latest message said to be from Osama Bin Laden, which called for armed opposition to any attack on Iraq, which could be led by the US and UK.

Intelligence agencies on both sides of the Atlantic have warned they believe an attack - possibly by Bin Laden's al-Qaeda network - could happen within days.

'Specific threat'

The US authorities have indicated they are more worried about an attack than at any time since passenger planes were hijacked and flown into buildings in New York and Washington on 11 September 2001.

Whether this is a signal of impending attack or not is something we're looking at George Tenet CIA Director

CIA Director George Tenet told a Senate committee on Tuesday: "This is the most specific [threat] we have seen."

On Wednesday, he told the same committee that broadcasts of statements believed to be from the al-Qaeda leader often preceded attacks.

He said a tape played on 6 October last year came before an attack on a French tanker in Yemen, the killing of a US diplomat in Jordan and the Bali nightclub bombing.

Another message released on 12 November was followed by an attack on Israeli targets in Kenya, he said.

Mr Tenet said it appeared Bin Laden wanted to encourage his followers.

"He is obviously exhorting them to do more," he said.

"Whether this is a signal of impending attack or not is something we're looking at."

. The UK has increased security visibly at Heathrow .

A spokeswoman at the Pentagon said the batteries of Stinger anti-aircraft missiles had been activated following assessment of new threats.

F-16 fighter jets and helicopters are also being used to protect the city and radar is being monitored.

The Pentagon building - one of the targets on 11 September - is being covered as are other landmarks.

Americans have been following advice to make emergency plans and have been stocking up on supplies of food and water.

British action

A senior member of the UK Government, John Reid, referred to the 11 September attacks when discussing what danger was being faced in London and other cities.

"This is about a threat of the nature that massacred thousands of people in New York," he said.

But Home Secretary David Blunkett said it was not necessary to close Heathrow - one of the world's busiest airports.

He told the public to be vigilant but not frightened and said he hoped the country would get through the next few days without incident.

Bin Laden's message

The possibility of an attack in Britain is being linked to the Muslim religious festival of Eid al-Adha, which coincides with the end of the annual Hajj pilgrimage which runs until Saturday.

The heightened security also comes as the United Nations prepares to hear a new report on Iraq from weapons inspectors on Friday.

We stress the importance of martyrdom attacks against the enemy; these attacks inflicted on America and Israel a disaster they have never experienced before Voice identified as Osama Bin Laden

Click here for Bin Laden's message

The US and the UK have been the leading international voices saying an invasion may be the only way to ensure Iraq has no banned weapons.

In a message broadcast on Tuesday, a man believed to be Bin Laden called for armed resistance including suicide missions to protect Iraq.

The taped statement has raised new tensions about any action to be taken against Iraq.

The US says it is further evidence of a link between Iraq and al-Qaeda while Germany says there is no proof. Iraq has also denied being a backer of Bin Laden.

China has warned the UN Security Council against getting involved in the North Korean nuclear crisis.

"The UN Security Council's involvement at this stage might not necessarily contribute to the settlement of the issue," said China's ambassador to the UN, Zhang Yan.

The UN Security Council's involvement at this stage might not necessarily contribute to the settlement of the issue Zhang Yan China's UN ambassador

He was speaking in Vienna after the UN's nuclear watchdog, the International Atomic Energy Agency (IAEA), took the dramatic step of declaring the North in breach of UN nuclear safeguards and referring it to the Security Council.

Japan has appealed to the North to re-open talks with the IAEA and South Korea called on it to seek a diplomatic solution to the crisis.

The IAEA's move raises the possibility of economic or political sanctions being imposed - a development Pyongyang has said would be tantamount to a declaration of war.

The Communist regime has still to react officially to the announcement.

'Dialogue of equals'

China backed the decision by the IAEA's 35-country board but its ambassador urged "dialogue" on Thursday.

"The only correct and effective approach... is through constructive dialogue and consultations on the basis of equality, especially the sincere and pragmatic dialogue directly among the parties concerned," he said.

. North Korea's Yongbyon power plant has been reactivated .

He did not name the United States but China has previously called for Washington, which withdrew aid to North Korea last year over its continuing nuclear programme, to speak directly to Pyongyang.

Washington sees China as one of the few states with influence in North Korea and Secretary of State Colin Powell said on Wednesday that it was in Beijing's interests to use its "leverage".

The Japanese Government has called on the North to "immediately re-open talks with the IAEA and quickly make moves towards a rapid and verifiable dismantling of its nuclear weapons programme".

Its top spokesman, Yasuo Fukuda, said the issue of sanctions would depend on "how North Korea thinks and deals with the current situation".

'Chronic offender'

Mohamed ElBaradei, the IAEA's director general, said North Korea had been in "chronic non-compliance since 1993".

CRISIS CHRONOLOGY

16 Oct: US announces that N Korea has acknowledged secret nuclear programme 14 Nov: US halts oil shipments to N Korea 22 Dec: N Korea removes monitoring devices at Yongbyon nuclear plant 31 Dec: UN nuclear inspectors forced to leave North Korea 10 Jan: N Korea pulls out of anti-nuclear treaty 28 Jan: President Bush urges the "oppressive" N Korean regime to give up its nuclear ambitions 12 Feb: IAEA refers issue to Security Council

Timeline of tensions

The director of America's CIA, George Tenet, has warned that the North might already be capable of hitting the west coast of the United States with a nuclear missile and supports sanctions.

But China's reluctance to impose sanctions is shared by the European Union as well as Japan and South Korea.

Russia - a veto-holding member of the Security Council and a key North Korean ally - abstained on the IAEA vote saying it believed that involving the Security Council would be "premature and counter-productive".

But, under its charter, the IAEA must report any violations of the nuclear non-proliferation treaty to the Security Council.

IAEA dismissed

North Korea said before Wednesday's decision that it was not interested in whether it was referred to the Security Council by the IAEA.

A North Korean spokesman told the BBC that the IAEA meeting was not impartial, and that it reflected only the American position in the stand-off over Pyongyang's nuclear activities.

The North Korean counsellor to the IAEA, Son Mun-san, reiterated that the only way forward was for Washington to hold direct talks with Pyongyang.

Mike Thomson, BBC Radio 4's Today Programme reporter who has just returned from Pyongyang, reports on the freezing temperatures and rising tensions in North Korea.

The city's underground system, with its sinister piped music, still works, largely thanks to having its own electricity supply, but everywhere else, life is slowly spluttering to a chilly, uncomfortable halt.

Sometimes the weather is as cold as -20 Centigrade and many of our homes have no heat at all Kim Jae-rok, director of the government's energy ministry

Most of the country lacks any heating or lighting, food is scarce, and the winters here are freezing.

Kim Jae-rok, director of the government's energy ministry, admits that times are not just hard, they are desperate.

"Sometimes the weather is as cold as minus 20C and many of our homes have no heat at all. Not only that, but most live in high-rise buildings and we lack the power to pump water up to those on above floors," he said.

"So many elderly people have no heating or water and sometimes have to walk up 40 or more floors because there's no power for the elevators either. Just imagine the suffering this causes," he added.

Pointing the finger

Mr Kim pins the blame, like most people here, on the United States, for pushing the country to freeze its nuclear programme, back in 1994.

. . Pyongyang's subway still works, but elsewhere life is stalling. .

"At that time, the 5-MegaWatt (MW) plant was working and we had started building two much bigger 50- and 200-MW atomic power plants. These would have produced 255,000 MW by the end of last year All were stopped, " he told me,

"We now need to build a total of five atomic energy plants to recoup that loss and meet the energy needs of our country... People are suffering, we cannot delay. We must do this as soon as possible, it is very urgent," Mr Kim warned.

Such a plan will not be music to the ears of the IAEA [International Atomic Energy Agency], or the American Government, who feel that the Yongbyon nuclear storage facility is already enough to worry about, without adding several more even larger plants that inspectors cannot visit.

Pyongyang insists that such schemes will be for peaceful purposes only, but that will not be enough in these nervous times.

Regular air raid drills and black-outs are now becoming part of everyday life here, which is a worrying trend in this volatile and divided land.

Invasion fears

I visited the truce village of Panmunjom, where the Koreas meet. Here, 1.7 million soldiers face each other - one million North Korean, 700,000 South Korean and 37,000 American. This is the place things could ignite.

Major Ri Kun-chol of the North Korean army acknowledges the risks of nuclear rows in a place where some opposing forces stand no more than 2 feet apart.

But he insists that his government has no plans to develop nuclear weapons, though he seems to believe that there is no reason why it should not, when others are not giving up theirs.

. . Lifts in apartment blocks have reportedly stopped .

"Have you ever heard us insisting that the US tells us that it is developing nuclear weapons?" he asks. "Our people don't want war, but if the United States provokes another Korean War here, we'll give them a big blow in a very unexpected way."

The major points to an article in a Pyongyang paper claiming to have proof of a detailed American plan to invade his country. But does he really believe this is true?

"Yes, it's true, it's all true. I have seen the newspaper. Korean newspapers don't tell lies. They are always fair and reflect reality."

At the Korean War Museum in Sinchon, south of Pyongyang, tourists are taken on a ghoulish tour of alleged American atrocities.

It includes the following: "He pulls the nails out of his fingers with pliers, then he pulled the nail out of his toes. They killed him by driving a dagger through his body. The poor man was 70 years old."

The curator was too young to fight then, and he looks too old now, should hostilities flare up again. But rather worryingly he, and many of his countrymen, seem to be almost hoping they will.

"We are now trying to turn all our country into a fortress. This can repel the enemy's attack. Not only the Korean people's army but all the people they are fully armed, ready to fight a war," he said.

The Philippine military has killed scores of Muslim rebels this week in a sweep of the southern island of Mindanao, a spokesman said.

"The latest count we have is 122 enemy killed," army division commander Major Generoso Senga told Reuters news agency by telephone, adding that the figures were being verified.

. . MILF rebels on another island, Basilan, have been surrendering .

The army is pursuing rebels from the Moro Islamic Liberation Front (MILF) which it accuses of harbouring a notorious kidnap gang.

Fighting continued on Thursday when a group of fighters briefly seized a village before being driven back by troops.

The army said that about 50 militants, whom it identified as MILF, attacked the village of Bual near the town of Tulunan.

They withdrew when troops appeared but escaped with eight male villagers as hostages.

Four rebels and a ninth hostage were killed in the fighting, the army added.

Rebel denial

The MILF has played down army reports of heavy casualties since the fighting erupted on Tuesday.

The rebels have vowed to continue fighting until government troops withdraw to their original positions and refused to attend talks scheduled for Wednesday to end the fighting.

"We cannot hold talks when the troops on the ground are fighting," MILF spokesman Eid Kabalu told the Associated Press.

Army spokesman Major Senga said three soldiers had been killed to date and 15 wounded.

Kidnappers targeted

The fighting started on Tuesday, when more than 2,000 soldiers advanced towards the MILF stronghold near Pikit, with tanks, artillery and planes.

The military says the attack was planned to flush out a group of kidnappers known as the Pentagon gang, which is on the list of US terrorist organisations.

The army has accused the MILF of sheltering Pentagon members, an accusation the rebels deny.

MILF guerrillas are campaigning for independence for the Muslim minority in the south of the Philippines - a predominantly Christian country.

Despite a cease-fire agreement signed in 1997, there continues to be sporadic outbreaks of violence.

So far up to 31,000 civilians have sought shelter from the fighting in schools and other government buildings.

Land seized from white farmers in Zimbabwe is going to be given to a Chinese utility firm, according to state media reports in Zimbabwe.

China International Water and Electric Corporation has reportedly been awarded a tender to grow crops on 100,000 hectars and help ease the food shortage.

Professor Tony Hawkins at the University of Zimbabwe in Harare said President Mugabe had turned to other countries to help it alleviate some of its many problems.

Zimbabwe has signed agreements with Libya for oil, Malaysia for foreign investment and trade and now China to farm its land.

But none of the deals seem to have any long-term effect.

Desperate measures

"It's all snatching at straws," Professor Hawkins told the BBC's World Business Report.

You'll find a number of African countries that say the future in terms of trade and investment is coupled with Asia Professor Tony Hawkins

"The Libyan example with oil is classic - over time, the shortage has become more severe," he said.

The Malaysian trade agreement is highlighted in the state media every three or four months but the foreign currency position keeps getting worse.

"Obviously the Malaysian trade package is not achieving very much - if anything," he said.

Turning east

The moves are also seen as Zimbabwe trying to gain help from Asian countries at the expense of the West.

"You'll find a number of African countries that say the future in terms of trade and investment is coupled with Asia," he said.

He believes the reaction of Zimbabweans to the prospect of foreigners arriving to take over the farms will be hostile.

Zimbabwe's permanent secretary at the Ministry of Land and Agriculture did not respond to questions about the land transfer.

Three Nobel prize winning economists have stepped forward to support President George W Bush's tax cut package, in response to 10 who condemned it earlier this week.

The National Taxpayers Union has sent a letter signed by 115 economists to the US Congress supporting the policy.

Government can... hinder economic growth through excessive taxes... or unnecessary spending National Taxpayers Union

The letter said that the "bold tax and budget agenda" would help end the "continued sluggishness in the American economy".

Among the signatories were Nobel prize winners Milton Friedman, James Buchanan, and last year's winner, Vernon Smith.

On Monday the left-leaning Economic Policy Institute placed an advertisement in the New York Times newspaper, signed by 400 economists, warning against Mr Bush's tax programme.

Deficit blow-out debate

"As a rule, government cannot create wealth or expand the economy," Wednesday's letter said.

"Government can, however, hinder economic growth through excessive taxes, high marginal tax rates, overregulation, or unnecessary spending," it continued.

"Accordingly, elected leaders should be working to adopt measures that curb or halt government policies that are hurting the economy."

The centrepiece of Mr Bush's $674bn package was eliminating taxes on shareholder dividends.

But the letter also called on the government to show spending restraint to keep the deficit under control.

Mr Bush's economic programme will push the deficit up to record levels.

The Economic Policy Institute said cutting tax on dividends was "not credible".

Strong sales of non-carbonated drinks have put a sparkle into sales at Coca-Cola.

The beverage giant, reporting profits of $930m for the October to December quarter, saw sales of juice drinks surge by 21% over 2002.

Overall, we were pleased with our results in 2002 in the face of a difficult macroeconomic environment Douglas Daft, chief executive, Coca-Cola

Sales of Powerade sports drink rose by one quarter, while the firm's water business recorded growth of 68% - compared with an industry average of 8%.

Overall, the volume of Coca-Cola drinks produced hit a record 18.7 billion unit cases, equivalent to almost 450 billion standard eight-ounce servings, and at the top end of Wall Street expectations.

"Volume results were sold," said JP Morgan analyst John Faucher.

But Mr Faucher dismissed as "anaemic" that growth in operating profits of 3.4% during the quarter, compared with the same period last year.

Goldman Sachs analyst Marc Cohen saw the figures as "encouraging", in the face of "some very visible challenges that the company confronted".

Factory shutdown

Beside the global economic downturn, the firm admitted it had faced "very challenging economic conditions" in Argentina and Venezuela.

The firm said a shutdown at a bottling plant in Venezuela, which has suffered weeks of industrial action in protest at the regime of president Hugo Chavez, had cost its Latin American operations one percentage point of growth.

In Germany, a surprise government clampdown on non-returnable containers had "negatively impacted" sales, as supermarkets spurned goods sold in non-recyclable packaging.

The firm added: "While this change in deposit laws will be disruptive in the short-term... the Coca-Cola system remains extremely well placed to take advantage of a probable move by consumers back to returnable packaging."

Analysts credited the firm's strong performance in the water market largely down to a decision last year to licence the distribution of Evian and Danone bottled water in North America.

The performance of the non-carbonated drinks unit was also boosted by the purchase of the Seagram line of drink mixers.

Sales of Coca-Cola's fizzy drinks grew by only 2% last year, with Fanta, recording 6% growth in sales, one of the strongest performers.

Future prospects

Chief executive Douglas Daft said, nonetheless, that the firm had "outpaced" rivals in all its major markets.

"Overall, we were pleased with our results in 2002 in the face of a difficult macroeconomic environment," Mr Daft said.

He added: "We are confident about how we will execute in 2003."

Goldman Sachs' Marc Cohen added that a company restructuring, and the decline in the dollar, had boosted the firm's profits potential.

Coca-Cola shares closed $0.74 higher at $39.74 in New York on Wednesday.

Economically troubled Zimbabwe is reportedly preparing to abandon its privatisation programme due to national security concerns.

"There is a deliberate policy shift by the government, which now wants to ensure the viability of key parastatals rather than selling them off," a Privatization Agency of Zimbabwe (PAZ) official told state media.

Air Zimbabwe, the heavily indebted airline, Zimbabwe Electricity Supply Authority (Zesa), National Railways of Zimbabwe, the National Oil Company of Zimbabwe and TelOne were named as state-owned companies that may now not be sold.

The southern African country is in the midst of its worst economic crisis since independence in 1980.

Political turmoil resulting from President Robert Mugabe's controversial land reform policy also means the sales may not have attracted foreign investors.

Strategic interest

"Concentration is now on commercializing the entities in order to turn around their fortunes without selling them because of their importance to the country," the PAZ official told state radio.

"Such strategic companies cannot be entrusted into the hands of anybody because this may compromise national security," the official said.

PAZ advises the government on privatisation of public companies and is expected to lead the commercialisation programme.

In his 2001 budget speech, former finance minister Simba Makoni said that the government would speed up privatisations to help pay-off accumulated interest on foreign debts of $488m.

Since then, the state has only sold its equity in the Cotton Company of Zimbabwe and Dairibord Zimbabwe.

Troubled

On Tuesday, a Zimbabwean parliamentary inquiry said the national airline was one of the worst international carriers and could collapse because of the economic crisis and cash shortages.

Two of Air Zimbabwe's six planes are grounded because there was no hard currency to buy spare parts, the head of the inquiry Silas Mangono told ZBC.

Mr Mangono said Air Zimbabwe, the only carrier still flying in the country, would make an operating loss of $21m this year.

By Angus Roxburgh BBC News Online, Brussels

On the face of it they are an unlikely threesome, ganging up against America and its planned war on Iraq.

Russia, under President Putin, has been currying favour with Washington, especially since the terrorist attacks of 11 September, 2001.

Russia may have been sucking up to America of late, but as a nation it has been smarting ever since the Soviet Union collapsed and it lost its status as a superpower

Germany, as Foreign Minister Joschka Fischer pointed out at the weekend, is grateful to the Americans for their part in the defeat of Nazism and the restoration of democracy.

And France... Well, France has always been something of a wandering star in the Allied constellation. But it too, in recent years, has played its role in American-led wars in Kosovo and Afghanistan.

So what's changed?

One thing unites Moscow, Berlin and Paris - their abhorrence of what they regard as American bullying, a feeling that has grown in the past week or so as the insults about them piled up.

. . Germany and Russia resent current and past US tactics .

First there was Donald Rumsfeld, the US defence secretary, damning France and Germany as "Old Europe", then his remark that Germany's stance on Iraq resembled that of Libya or Cuba.

The more criticisms are levelled against them - for causing a "crisis of credibility" within Nato, and for their "shameful" refusal to help Turkey - the more this new triangular relationship will be cemented.

Germany, currently in the chair of the UN Security Council, has been canvassing opinion, and says only four of its members - the US, UK, Spain and Bulgaria - oppose the line being taken by the anti-war troika.

The consequences could be very interesting.

Security Council tactics

Unless the UN's chief weapons inspector Hans Blix delivers a damning report on Iraq next Friday, then the three will at the very least stand a good chance of preventing the US and UK from getting a second resolution adopted which would authorise the use of force against Iraq.

They may go even further and propose a "counter-resolution" calling for prolonged, intensified arms inspections, backed up by increased surveillance.

President Bush's attitude has reminded Russians of the bad old days when American presidents branded Russia the "evil empire" and went around toppling or undermining pro-Soviet regimes around the world

France's role in the troika is crucial. It has a long history of independent thinking, especially in foreign and defence policy. Since Jacques Chirac's re-election as president last summer Paris has been more bullish than ever.

Russia may have been sucking up to America of late, but as a nation it has been smarting ever since the Soviet Union collapsed and it lost its status as a superpower, and with it the "right" to divide the world into spheres of influence with the USA.

Under President Yeltsin, the Kremlin resisted every American move towards hegemony, including the gradual extension of Nato into eastern Europe.

Vladimir Putin was more pragmatic. He acquiesced in the expansion of Nato, even to include the three Baltic states territories which were once part of the USSR.

. . The attacks brought Russia and US closer, but Iraq is dividing them .

The reasons for this included a desire for better relations and the promise that Russia would be better integrated into the world community.

After 11 September Putin quickly signed up to the "war on terror", partly to gain sympathy and help in his own war on terrorism in Chechnya.

A Nato-Russia council was set up last May, crowning the new relationship.

But Iraq is another matter. For one thing, like France, Russia has economic interests there.

But more important, President Bush's attitude has reminded Russians of the bad old days when American presidents branded Russia the "axis of evil" and went around toppling or undermining pro-Soviet regimes around the world. It has reawakened Russia's acute sense of hurt and inferiority.

German pacifism

Germany's position is the most extreme - ruling out participation in a war on Iraq even if there is a UN resolution in favour of it. That stance was adopted before last September's elections and probably helped Gerhard Schroeder scrape back into office.

It was a popular policy in a country which since World War II has developed strong pacifist traditions. Nonetheless, it might have been modified had it not been for America's strong-arm tactics, which have united Germans in their opposition to war.

All three countries suspect the US is using Nato as its personal weapon, circumventing the United Nations, where international action should really be decided.