One surfer dead, one missing off WA

A SURFER has died and another is missing after they were caught in a strong rip near Margaret River, in Western Australia's southwest.

A search and rescue operation had been under way until nightfall, with grave fears held for the 23-year-old man, the ABC reports.

Both surfers were at Redgate Beach, 280km south of Perth, when they got caught in treacherous conditions, police said.

Rescuers managed to reach the 29-year-old surfer but they were unable to revive him.

AA

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Egypt opposition rejects Morsi talks offer

The Egyptian army has moved in to restore order after violent protests in Cairo escalated. Source: AAP

EGYPT'S mainly secular opposition has rejected an offer of dialogue from President Mohamed Morsi, raising the prospect of further escalation of a crisis that already turned bloody earlier this week.

Funerals for several of the seven people killed in Wednesday night clashes between Morsi supporters and opponents - all said to be members of the Muslim Brotherhood which backed him for the presidency - were to be held on Friday, the traditional day of Muslim prayer and rest.

Opposition coalition the National Salvation Front called for more mass demonstrations after the main midday prayers, in a possible test for soldiers and anti-riot police guarding the presidential palace with tanks and barbed wire barricades.

The opposition bloc accused Morsi of rejecting "repeated demands to him to offer consensus solutions... to lift Egypt out of its current disastrous situation."

It accused the president of "dividing Egyptians between his 'supporters of legitimacy'... and his opponents, whom he calls 'thugs'".

In a televised speech late on Thursday, Morsi defended giving himself sweeping new powers by decree last month, and said he would push on with a December 15 referendum to change Egypt's constitution along lines drafted by a mostly Islamist panel.

Morsi said he was ready to hold talks with the opposition on Saturday, but showed little inclination to compromise.

The scene outside the presidential palace was calm ahead of noon prayers but security was tight.

Around a dozen tanks and armoured troops carriers were deployed in the vicinity, with soldiers and riot police massed behind barbed wire barricades.

On Thursday, they had cleared the area.

Protests were expected to swell after the main prayers.

Youth activist group April 6 called for marches from all of Cairo's mosques to converge on the capital's main squares.

The demonstrations seen this week were the biggest since Morsi took office in June.

The street clashes were also reminiscent of the upheaval in February 2011 that toppled veteran strongman Hosni Mubarak.

In his speech late on Thursday, Morsi said the referendum on the constitution would go ahead as planned, adding that "afterwards... everyone must follow its will".

He said: "We respect peaceful freedom of speech but I will never allow anyone to resort to killing and sabotage."

Hundreds of opposition protesters tried to storm the Cairo headquarters of the Muslim Brotherhood as he made his speech, but were pushed back by riot police firing tear gas.

At least four of Morsi's advisers have quit over the crisis, and the Cairo stock market has taken a heavy hit.

The United States and European Union have called for dialogue to resolve the crisis.

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Chavez home after Cuba treatment

VENEZUELAN President Hugo Chavez has arrived back home in Caracas after10 days of medical treatment in Cuba.

State television showed images of Mr Chavez arriving at Caracas' airport early Friday and walking down the steps of the presidential jet.

Mr Chavez was received by members of his Cabinet, including Vice President Nicolas Maduro.

Mr Chavez traveled to Cuba on the night of Nov. 27 after announcing plans to undergo hyperbaric oxygen treatment in Havana.

The Venezuelan leader has spent much of the past 18 months fighting cancer, and said several months ago that he was cancer-free.

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Bangladesh blaze factory had no licence

A BANGLADESH garment factory where 110 workers were killed by a fire as they made clothing for firms such as Walmart did not have a valid safety license at the time of the blaze, an official said.

The Tazreen Fashion's fire safety license expired in June this year and the owners had not subsequently applied for a new one, said the fire department's administrative director Abdus Salam.

"Its license for 2011-12 year expired on June 30 this year and they did not come to us for renewing the fire safety certificate for 2012-13. We approve licenses after inspecting factory conditions," he said.

The 110 staff at the Tazreen factory were killed when a fire ripped through the nine-storey building on November 24 on the outskirts of Dhaka.

The victims, who were mostly women paid as little as $37 a month, found themselves overcome by smoke or jumped from elevated windows. Firefighters have told AFP that all three of the fire exits led to the ground floor.

The factory was supplying clothes to a variety of international groups including US giant Walmart, Dutch retailer C&A, Hong Kong supplier Li & Fung as well as to the brand owned by US rapper Sean "Diddy" Combs.

Mr Salam said none of the factory's fire equipment was used during the blaze and that initial investigations found that the inferno did not originate from an electric short circuit as was feared initially.

Mr Salam said the official government inquiry team would submit its report in the third week of the month. Its initial investigations pointed to "arson or sabotage" as the main cause of the incident.

Authorities have previously said that the nine-storey factory only had permission for three floors.

There have also been accusations that managers instructed employees to stay at their work stations when the fire broke out and told them that the activation of a fire alarm was only a routine drill.

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Hamas chief kisses soil on first visit to Gaza

EXILED Hamas leader Khaled Meshaal crossed into the Gaza Strip on his first-ever visit, kissing the ground and hoping he would one day die a "martyr" in the Palestinian territory.

Accompanied by his deputy, Mussa Abu Marzuk, and other senior officials, Meshaal drove through the crossing and then got out and kissed the ground before embracing Gaza's Hamas prime minister Ismail Haniya.

His visit comes just two weeks after the end of a fierce conflict with Israel, which began on November 14 with an Israeli air strike in Gaza City that killed top Hamas militant Ahmed Jaabari.

Shortly after his arrival, Meshaal was taken to see the charred remains of Jaabari's car, which had been transported to Rafah especially for the visit.

"I hope God will make me a martyr on the land of Palestine in Gaza," he said on seeing it.

Izzat al-Rishq, another senior member of the Islamist movement's exiled politbureau, said it was a moving experience to finally be in the Hamas-ruled Gaza Strip.

"This is the greatest feeling I've ever had. It is an unforgettable historic moment," he said. "Our wish to kiss the soil of Palestine has come true."

Senior Hamas official Mahmud al-Zahar hailed the visit and said it was replete with symbolism.

"No matter how long a Palestinian is away from his homeland, he will always return after a victory," he said.

Streets across the territory were decked with green Hamas flags to mark the visit, along with the red flags of the Popular Front for the Liberation of Palestine (PFLP) which on December 11 marks its 45th anniversary.

Masked Hamas militants from its Ezzedine al-Qassam Brigades armed wing were out en masse, wearing fatigues and carrying Kalashnikov assault rifles, as they patrolled the roads along which the official convoy was set to travel.

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Baffling petrol station signs in spotlight

PETROL stations across Australia could be forced to standardise their fuel price boards in a bid to stop servos luring in drivers with misleading petrol signs.

The Legislative and Governance Forum on Consumer Affairs (CAF) on Friday released a public consultation paper canvassing options to simplify roadside fuel boards.

The paper, Consumers and Fuel Price Boards, is a response to complaints about fuel boards advertising only some fuel types, or low prices that are only available to drivers who have the right shopper docket or credit card.

"Consumers are being sucked in by fuel price boards that prominently display the prices of the most discounted fuel type," federal Assistant Treasurer David Bradbury said on Friday.

"Once they drive into the service station, only then do they find out that there are often large differences between the prices of the different fuel types available - sometimes more than 10 cents a litre."

The CAF paper includes three options to make the rules around price boards clearer.

Changes could include only letting fuel boards show undiscounted prices, or developing a detailed national standard mandating equal prominence for the undiscounted prices of a standard set of fuel types.

The third option would rely on current laws and industry self-regulation, though the consultation paper notes there are currently "no known efforts to develop an industry-led response to the identified problem".

The national peak motoring body welcomed the new paper.

"Motorists are confused and deserve improved fuel price information - maintaining the status quo is not an option," Australian Automobile Association executive director Andrew McKellar said in a statement.

"A recent national survey showed eight out of ten motorists supported consistent fuel price signage across all service stations."

Specific regulations about what information is given on fuel price boards and how it is displayed are already on the way for NSW.

From September next year, retailers selling up to four fuels must display the price of all of those fuels.

NSW Fair Trading Minister Anthony Roberts said a similar approach at the national level would boost transparency.

"I am proud NSW is leading the nation when it comes to giving motorists a fair go at the petrol pump," he said in a statement.

Motorists and industry stakeholders can have their say by visiting the Australian Consumer Law website (www.consumerlaw.gov.au).

Submissions close on February 15.

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Italian police recover stolen sphinx

ITALIAN police say they have recovered a 2000-year-old Egyptian sphinx statue that was stolen from a necropolis near Rome and was about to be smuggled out of the country.

"The investigation began with a random check of an industrial vehicle during which police found a decorative ceramic object from an excavation as well as many photos of the Egyptian sculpture," the police said in a statement.

A search of the driver's residence turned up the statue from the Ptolemaic era (4th-1st centuries BC) packed into a crate and hidden in a greenhouse.

The statue is believed to have been stolen from the Etruscan necropolis of Montem Rossulum near Viterbo, some 100 kilometres from Rome.

The police "prevented the sculpture, as well as a series of ancient objects from being put on the clandestine international market," the statement said.

The granite statue measures 120 centimetres and 60 centimetres.

Egyptian sculptures began to be shipped to Italy following the Roman conquest of Egypt in the 1st century BC.

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Hospitalised drug mules a legal quandary

EMERGENCY physicians are calling for tougher reporting laws for doctors who treat drug mules, claiming the lack of uniform guidelines leaves medical staff in a precarious legal position.

A report published in the Emergency Medicine Australasia journal on Thursday outlined the case of a southeast Asian man found with drugs in his small bowel by doctors treating him for nausea, vomiting and diarrhoea at The Alfred hospital in Melbourne.

The objects found were consistent with 'body packing' - drugs stored in rubber or latex packaging and swallowed, said emergency physicians Dr Biswadev Mitra and Dr de Villiers Smit.

Dr Mitra said most drug mules requiring medical attention were brought to hospitals by law enforcement officers.

However, those rarer cases discovered first by emergency departments were difficult to report to authorities because of legal obligations around patient confidentiality, Dr Mitra said.

This left many doctors exposed to the risk of legal action for breach of privacy laws.

He said doctors needed to weigh up whether considerations including danger to the public outweighed legal concerns surrounding patient confidentiality, by which time the patient would likely have been discharged.

"We get patients who are obviously users or carrying amounts of drugs and we are often very unsure about what to do in terms of the legal ramifications," Dr Mitra told AAP.

Dr Mitra said doctors wanted 'black and white' guidelines about when to notify authorities about people carrying drugs.

He said the laws could start with mandatory reporting of people found with large quantities of drugs, such as drug traffickers, but possibly extend to those found with smaller quantities.

"Rather than let doctors and their legal representatives speculate on the right course of action, clear national statutory amendments should be developed and applied in the setting of managing patients with illicit drugs," Dr Mitra said.

Dr Nicola Cunningham, an emergency physician at St Vincent's Hospital in Melbourne, said in most Australian jurisdictions mandatory reporting was only required for notifiable infectious diseases, impaired medical colleagues, and suspected child abuse.

But many other ethical and legal scenarios were raised on a daily basis with little time for consultation, which could leave patients and doctors open to legal ramifications.

Alfred Health legal counsel Bill O'Shea said there should be a statutory exemption in privacy laws allowing doctors to report cases of body packing.

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Blast wounds Afghan intelligence chief

AFGHANISTAN'S intelligence chief has been wounded in an assassination attempt in the capital, Kabul, Afghan officials say.

A senior government official said Asadullah Khalid suffered injuries on the lower part of his body when a bomb exploded at the intelligence chief's guest house as he was receiving a visitor.

The house is used for private meetings that Khalid doesn't want to hold at the official compound of the National Directorate of Intelligence, the official said.

The official would not provide more details beyond saying the bombing was an attempt on Khalid's life.

Khalid was rushed to a medical facility run by the intelligence service, the government official said.

An Afghan police official also confirmed that Khalid was injured in a blast.

Both officials spoke on condition of anonymity because they were not authorised to disclose the information.

Khalid, a former minister of tribal and border affairs and ex-governor of two provinces, was appointed head of the service in September.

There was no immediate claim of responsibility for the attack.

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South African army plane crashes, kills 11

A SOUTH African military aircraft on an unknown mission to an area near former President Nelson Mandela's village has crashed in a mountain range, killing all 11 people onboard, officials say.

The Douglas C-47TP Dakota, a twin-propeller aircraft, had taken off from Pretoria's Waterkloof Air Force Base on Wednesday morning, said Brigadier General Xolani Mabanga, a military spokesman.

The aircraft encountered bad weather in flight and failed to make its 10am landing.

On Thursday morning, soldiers found the wreckage in the Drakensberg mountains near Ladysmith in KwaZulu-Natal province, some 340 kilometres southeast of the air base, Mabanga said.

The Drakensberg, which in the local Afrikaans language means Dragon Mountains, have the highest peaks in South Africa, reaching to a height of about 3400 metres.

In a statement on Thursday, South Africa's Defence Department said an investigation would begin into the cause of the crash, which killed six crew members and five passengers.

The statement did not explain what the aircraft had been doing, nor did it name those killed in the crash.

Siphiwe Dlamini, a Defence Department spokesman, did not immediately respond on Thursday to a request for more information about the crash.

Mthatha is about 30 kilometres north of Qunu, the village where Mandela now lives after retiring from public life.

South Africa's military remains largely responsible for the former president's medical care.

However, military officials declined to say whether those on board had any part in caring for Mandela.

In November, another South African military flight crash-landed at Mthatha, injuring several people.

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Tanks deployed near Egypt president palace

Tanks have been deployed outside Egypt's presidential palace following a night of deadly clashes. Source: AAP

EGYPT'S army has deployed tanks outside the presidential palace after a night of deadly clashes between opponents and supporters of President Mohamed Morsi.

Three tanks and three armoured personnel carriers were stationed metres from the front gate of the palace in northern Cairo on Thursday as hundreds of Morsi's partisans chanted slogans in support of the president.

The military pledged on Thursday not to use violence against protesters.

General Mohammed Zaki, head of the Republican Guard tasked with protecting the president, said that "the armed forces, and the Republican Guard, will not be an instrument of oppression against protesters," the official MENA news agency reported.

Egypt's army will clear protesters still outside the presidential palace at 1300 GMT (0000 AEDT) and ban any demonstrations near the complex after deadly overnight clashes, the presidency said in a statement.

"The Republican Guard has decided to clear the area around the presidential palace at 1500 local time and ban protests around institutions belonging to the presidency," the statement said.

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Breath test to detect colorectal cancer

AN experimental breath test can diagnose colorectal cancer with an accuracy of over 75 per cent, Italian researchers say.

The electronic "nose" detects key molecules emitted by tumours, a technique that is also being used in pioneering diagnostics for lung and breast cancer.

A team led by Donato Altomare of the Department of Emergency and Organ Transplantation at the University Aldo Mori in Bari collected exhaled breath from 37 patients with colorectal cancer and 41 healthy counterparts.

The breath was then analysed by gas chromatography and mass spectrometry, which looked for a tiny chemical "fingerprint" for so-called volatile organic compounds linked to cancer.

Colorectal cancer is the second leading cause of cancer-related death in Europe, after lung cancer, and the third in the United States.

The human and economic cost of the disease is pushing the search for swift, cheap and simple diagnostic tools, compared with tests on stool DNA or faecal blood or a colonoscopy to detect dangerous polyps.

"The technique of breath sampling is very easy and non-invasive, although the method is still in the early phase of development," said Altomare on Wednesday.

"Our study's findings provide further support for the value of breath testing as a screening tool."

The paper is published in the British Journal of Surgery.

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UN chief blames rich for global warming

RICH countries are to blame for climate change and should take the lead in forging a global climate pact by 2015, a deadline that "must be met", the head of the United Nations says.

On the sidelines of international climate talks in Qatar, UN Secretary-General Ban Ki-moon said on Wednesday it was "only fair and reasonable that the developed world should bear most of the responsibility" in fighting the gradual warming of the planet.

Ban's comments echoed the concerns of China and other developing countries, which say rich nations have a historical responsibility for global warming because their factories released carbon emissions into the atmosphere long before the climate effects were known.

"The climate change phenomenon has been caused by the industrialisation of the developed world," Ban said. "It's only fair and reasonable that the developed world should bear most of the responsibility."

Many rich nations including the US and European Union say the division between developed and developing countries that has guided the two-decade-old climate process in the past, no longer reflects the world today and isn't helpful in dealing with the problem.

Most of the emissions now come from the developing world, and China has overtaken the US to become the world's top carbon polluter.

How to divide the burden of emissions cuts is at the core of discussions to create a new global climate treaty that would apply to all nations. The only binding pact so far, the Kyoto Protocol, only covers the emissions of industrialised countries.

Last year, governments decided that the new treaty should be adopted in 2015 and enter force five years later. The Doha meeting is supposed to produce a work plan to ensure that the treaty is ready by 2015.

"This deadline must be met. There is no time to waste, no time to lose for us," Ban said.

"Climate change is happening much, much faster than one would understand," he added. "The science has plainly made it clear: it is the human beings' behaviour which caused climate change, therefore the solution must come from us."

Ban came to the negotiations in Doha in an attempt to "accelerate the process" of shifting the world to a clean energy pathway, and helping the most vulnerable countries adapt to inevitable warming.

Governments represented at the talks in Qatar are also discussing extending the Kyoto Protocol, which expires this year, as a stopgap measure until the new deal takes effect.

The United States never joined the Kyoto Protocol, partly because it didn't cover emerging economies like China and India. For similar reasons, Canada, New Zealand and Japan don't want to be part of the extension, meaning it would only cover Europe and Australia, who account for less than 15 per cent of global emissions.

Nevertheless, Ban said it is "imperative" that the treaty is extended, because it is "the only existing legally binding commitment when it comes to climate change."

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Royal baby sparks merchandise madness

LESS than 24 hours after the announcement of a royal pregnancy, quick-thinking entrepreneurs have turned their thoughts to how they can cash-in on a forecast merchandise frenzy.

Following Monday's news that Prince William and wife Catherine are expecting their first child, a British pottery firm fired up the kiln on Tuesday and went into production with a commemorative mug.

The white cup is covered in red and blue hearts and reads "A Royal Baby in 2013" on one side, and "Hooray for Will and Kate" on the other.

The company, operated by Emma Bridgewater and husband Matthew Rice, sold STG3.2 million ($A4.95 million) worth of souvenirs for the Queen's diamond jubilee earlier in 2012 and will put their latest product on sale for STG19.95 as soon as possible, they told British newspaper The Daily Telegraph.

Jan Constantine said her embroidery firm also has plans to cash-in on the royal baby fever.

"We are thinking along the lines of mugs, baby blankets and small cushions to mark this momentous occasion," she said.

The sales flurry is estimated to generate STG500 million for UK firms, retail experts told The Sun newspaper.

"Any brand the royal couple choose will become highly sought-after," consultant Neil Saunders told the tabloid.

Nursery furniture stores in London are bracing for a big buy-up based on the royal selections, while there are unconfirmed reports maternity brands have already sent samples to the palace for Catherine to try. Outfits worn by the Duchess typically sell five times better than others.

In Naples, souvenir producers are taking a lighter approach to royal pregnancy products.

A terracotta figurine on sale at the Italian city's Christmas markets shows a heavily pregnant Catherine wearing a white dress, accompanied by William in red military jacket.

Plans for official baby-inspired souvenirs by the monarchy's official retailer, The Royal Collection, are yet to be announced.

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Strike at LA ports ends as deal reached

CLERICAL workers and longshoremen at the US's largest port complex have agreed to return to work on Wednesday, eight days after they walked out in a crippling strike that prevented shippers from delivering billions of dollars in cargo across the country.

"I'm really pleased to tell all of you that my 10,000 longshore workers in the ports of LA and Long Beach are going to start moving cargo on these ships," said Ray Familathe, vice president of the International Longshore and Warehouse Union.

"We're going to get cargo moved throughout the supply chain and the country and get everybody those that they're looking for in those stores."

Negotiators reached a tentative agreement to end the strike late on Tuesday, less than two hours after federal mediators arrived from Washington DC. No details about the terms of the deal were released, though a statement from the union said it had won new protections preventing jobs from being outsourced.

At issue during the lengthy negotiations was the union's contention that terminal operators wanted to outsource future clerical jobs out of state and overseas - an allegation the shippers denied.

Shippers said they wanted the flexibility not to fill jobs that were no longer needed as clerks quit or retired. They said they promised the current clerks lifetime employment.

The strike began November 27, when 450 members of the union's local clerical workers unit walked off their jobs. The clerks had been working without a contract for more than two years.

The walkout quickly closed 10 of the ports' 14 terminals when some 10,000 dockworkers, members of the clerks' sister union, refused to cross picket lines.

Even though the deal was reached soon after their arrival, the federal mediators said they had little to do with the solution.

"In the final analysis, it worked. The parties reached their own agreement, said George Cohen, director of the Federal Mediation and Conciliation Service. "There is no question in my mind that collective bargaining is the best example of industrial democracy in action."

During the strike, both sides said salaries, vacation, pensions and other benefits were not a major issue.

Combined, the Los Angeles and Long Beach ports handle about 44 per cent of all cargo that arrives in the US by sea. About $US1 billion ($A958.91 million) a day in merchandise, including cars from Japan and computers from China, flow past its docks.

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Asylum seekers drop court challenge

A GROUP of Sri Lankan asylum seekers have dropped a High Court challenge to their deportation after the federal government agreed they would not be removed "in the foreseeable future".

The 56 Tamils, who are in detention in Darwin, were due to have the court hear their case on Thursday but refugee advocate Ian Rintoul says it now won't go ahead.

At issue was the practice of "screening out", when asylum seekers are asked to explain why they came to Australia and the circumstances in their home country.

It is understood this process is often done in a single interview.

On Wednesday the men involved in the court challenge were allegedly told they would now be able to make their protection visa claims in the usual way.

Mr Rintoul welcomed the move but said the government had much to explain.

"It has been desperate to avoid the court and any public scrutiny of its screening-out process," he said in a statement on Wednesday.

"It has virtually admitted that it cannot defend the way in which screening-out decisions are being made."

However, an Immigration Department spokesman told AAP no agreement had been made with the asylum seekers.

He said the men had been told they would not be removed "in the foreseeable future", but did not rule out that the men may be sent to offshore processing centres or eventually face deportation.

"If the asylum seekers are found not to be eligible to stay in Australia they will be returned to Sri Lanka," the spokesman said.

"There are no current plans to return them in the foreseeable future but as they arrived after August 13 they may be transferred to Nauru or Manus Island.

"The department gave no undertaking this group would be processed in Australia."

Greens immigration spokeswoman Sarah Hanson-Young called on the government to end the "screening-out" practice for all boat arrivals.

"The government needs to assess whether these people are refugees before they make the decision as to whether they should be deported," she said in a statement.

Australia has deported 593 Sri Lankans involuntarily since August 13.

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Man charged over Pitt St office rapes

A MAN alleged to have sexually assaulted other men at an office in Sydney's Pitt Street has been charged by police.

The alleged offences date back to 1995 to 2004, involving four victims.

Strike Force Woodcliff was formed to investigate the alleged sexual assaults by the man, who worked in the Pitt Street office.

The alleged offender, aged 60, was arrested on Tuesday and charged with seven offences including sexual intercourse without consent and indecent assault.

He was granted bail to appear in the Downing Centre Local Court on January 22, 2013.

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Asian markets mixed after weak US data

ASIAN markets have closed mixed following weak US manufacturing data and fears over US talks aimed at averting the fiscal cliff.

The euro touched a six-week high against the dollar at one point on Tuesday, helped by news Greece had begun a debt-buyback program and eurozone finance ministers had nodded through a bailout for Spain's troubled banks.

Tokyo fell 0.27 per cent, or 25.72 points, to 9,432.46, Sydney eased 0.62 per cent, or 27.9 points, to 4503.6 and Seoul lost 0.25 per cent, or 4.84 points, to close at 1,935.18.

Hong Kong was 0.15 per cent higher, adding 32.12 points to end at 21,799.97 while Shanghai was up 0.78 per cent, or 15.37 points, at 1,975.14.

Both markets rebounded after posting heavy losses the previous day.

US shares turned down on Monday after the Institute for Supply Management (ISM) said its index on manufacturing activity for November showed contraction following two months of expansion.

The purchasing managers index (PMI) fell to 49.5, below the 50 breakeven level, from 51.7 in October.

Businesses surveyed by the ISM blamed the slow global economy and uncertainty over the fiscal cliff battle in Washington. It followed positive manufacturing numbers across Asia, while Europe also saw a marginal improvement.

The Dow slid 0.46 per cent, the S&P 500 fell 0.47 per cent and the Nasdaq shed 0.27 per cent.

US politicians have until the end of the month to agree a deal on cutting the country's huge deficit and avoid the fiscal cliff of huge tax hikes and spending cuts widely expected to tip the economy into recession if they take effect.

However, there has been little progress, with Republicans and Democrats blaming each other for the stalemate.

On Monday the Republicans put forward a proposal to the White House that calls for $US800 billion ($A770 billion) in increased tax revenue, half of what President Barack Obama has proposed, while it also includes huge cuts to Medicare and other programs. The plan was immediately rejected.

In Europe, Greece began its program to buy back privately held debt at a big discount, the underlying condition for it to receive its next tranche of bailout funds from the European Union and International Monetary Fund.

Eurozone finance ministers also gave the green light to a 39.5 billion euros ($A50 billion) recapitalisation of Spain's banks next week.

A preliminary plan for a bailout for Cyprus worth 17 billion euros was also drawn up.

The euro climbed at one point to $US1.3081 - its highest since October 22 - before easing slightly to $US1.3074, while it also bought Y107.21 in early European trade, compared with $US1.3051 and Y107.36 in New York late on Monday.

The dollar was slightly lower at Y82.02 from Y82.24.

The Australian dollar rose to US$1.0454 from the $US1.0421 seen just before the central bank cut interest rates by 25 basis points to three per cent citing problems in the global economy, in particular Europe and the United States.

Oil prices eased, with New York's main contract, light sweet crude for delivery in January, down 43 cents to $US88.66 a barrel in the afternoon and Brent North Sea crude for January shedding 53 cents to $US110.39.

Gold was at $1,705.44 at 1055 GMT (2155 AEDT) compared with $US1,717.75 late on Monday.

In other markets:

- Singapore's Straits Times Index closed down 0.12 per cent, or 3.62 points to 3,062.12.

Olam International gained 1.59 per cent to Sg$1.60 and Singapore Telecommunications added 0.61 per cent to Sg$3.31.

- Wellington fell 0.82 per cent, or 33.40 points, to 4,015.69.

Fletcher Building was off 0.88 per cent at NZ$7.91 and Telecom ended down 1.94 per cent at NZ$2.28.

- Manila closed 0.59 per cent higher, adding 33.58 points to 5,706.28.

SM Prime Holdings gained 2.72 per cent to 16.60 pesos while BDO Unibank rose 1.34 per cent to 72 pesos. Empire East Landholdings was unchanged at 1.03 pesos.

- Taipei was flat, edging up 1.07 points to 7,600.98.

Smartphone maker HTC rose 4.53 per cent to Tw$278.5 while chip giant TSMC fell 1.34 per cent to Tw$96.6.

- Kuala Lumpur shares edged up 0.26 points or 0.02 per cent to close at 1607.61.

British American Tobacco gained two per cent to 56.62 ringgit while Petronas Chemicals Group rose 1.2 per cent to 5.73. UEM Land Holdings lost 2.4 per cent to close at 2.08 ringgit.

- Jakarta ended down 32.79 points, or 0.76 per cent, to 4,269.65.

Lender BCA fell 7.9 per cent to 8,750 rupiah, car maker Astra International slipped 4.17 per cent to 6,900 rupiah, while cigarette maker Gudang Garam climbed 0.19 per cent to 53,850 rupiah.

- Mumbai's Sensex index rose 0.22 per cent or 42.80 points to 19,348.12 points.

Mahindra & Mahindra was down 1.75 per cent at 938.95 rupees and Tata Power was up 4.0 per cent at 111.75 rupees.

- Bangkok edged down 2.86 points or 0.21 per cent to close at 1,330.06.

Coal producer Banpu lost 1.28 per cent to 387.00 baht while energy giant PTT Plc gained 0.62 per cent to 327.00 baht.

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Egyptians to march on presidential palace

OPPONENTS of Islamist President Mohamed Morsi are planning to march on the presidential palace to protest against his power grab and a controversial draft charter, as the country plunged deeper into crisis.

Five marches were set to take off at 4pm local time on Tuesday (0100 AEDT Wednesday) from several mosques in Cairo towards the Itihadiya presidential palace in the upscale neighbourhood of Heliopolis, organisers said.

Security measures have been tightened around the capital, with some schools and businesses closing early for the day.

A November 22 decree issued by Morsi expanding his powers and enabling him to put to a December 15 referendum a draft constitution - rejected by liberals, leftists and Christians - has sparked strikes and deadly protests.

Independent and opposition newspapers refused to publish their Tuesday editions in protest at the lack of press freedom in the constitution.

The move was in order to "stand up to tyranny," independent daily Al-Tahrir said on its website.

"The Egyptian Independent objects to continued restrictions on media liberties, especially after hundreds of Egyptians gave their lives for freedom," read a message on that newspaper's website, its only viewable content on Tuesday morning.

Daily Al-Masry Al-Youm said the papers were "protesting against the articles on the press in the draft constitution ... and reject (Morsi's) November 22 decree."

As he faces his worst crisis since taking office in June, Morsi insists the measures are aimed at ending a tumultuous transition following the popular uprising that toppled Hosni Mubarak in 2011.

But his opponents have accused him of choosing the same path of autocracy that finally cost Mubarak his presidency.

Morsi's decree not only placed his decisions beyond judicial oversight but also barred any judicial body from dissolving the Islamist-dominated panel that drafted and approved the new constitution, sparking a conflict with the country's judges.

The constitution has become the focal point of a political and ideological battle in Egypt between Islamists who support Morsi and the largely secular-leaning opposition.

The charter has been criticised for failing to protect key rights and for paving the way to a strict interpretation of Islamic law.

In Cairo's iconic Tahrir Square, hundreds of protesters have been camping out since Morsi issued his decree.

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US denies Iran drone capture claims

IRAN has claims it has captured a US drone but the US Navy says all its unmanned aircraft in the region are "fully accounted for".

The conflicting accounts still leave the possibility that the drone claimed by Iran, a Boeing-designed ScanEagle, could have been plucked from the sea in the past and unveiled for maximum effect following escalating tensions over US surveillance missions in the Gulf.

Other countries in the region - such as the United Arab Emirates - also have ScanEagle drones in their fleets.

A spokesman for the US Navy's 5th Fleet in Bahrain said ScanEagles operated by the Navy "have been lost into the water" over the years, but there is no record of that occurring recently.

The Iranian announcement did not give details on the time or location of the claimed drone capture.

Iran claimed it captured the drone after it entered Iranian airspace. A report on state TV quoted the navy chief of Iran's Revolutionary Guard, General Ali Fadavi, as saying the Iranian forces caught the "intruding" drone, which had apparently taken off from a US aircraft carrier.

Al-Alam, the Iranian state TV's Arabic-language channel, showed two Guard commanders examining what appeared to be an intact ScanEagle drone. It was not immediately clear if that was the same drone Iran claimed to have captured.

In the footage, the two men then point to a huge map of the Persian Gulf in the background, showing the drone's alleged path of entry into Iranian airspace.

"We shall trample on the US," was printed over the map, next to the Guard's coat-of-arms.

If true, the seizure of the drone would be the third reported incident involving Iran and US drones in the past two years.

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Rebels, troops clash near Syria capital

The UN has suspended operations in Syria and begun withdrawing non-essential staff. Source: AAP

FIGHTING between rebels and Syrian regime troops has raged in and around the capital Damascus, with opposition fighters pushing their way closer to the seat of President Bashar Assad's power base.

The rebels have notched a series of tactical victories in recent weeks, overrunning two air bases near Damascus and capturing a hydroelectric dam in the north.

Gunmen shot dead a journalist for a pro-government newspaper near Damascus on Tuesday, Syria's official news agency said.

With the Syrian regime feeling squeezed, US officials said intelligence reports show Assad may be readying his chemical and biological weapons and may be desperate enough to use them.

Any use by the Syrian regime of chemical weapons against its own people would spark an immediate reaction by the international community, NATO head Anders Fogh Rasmussen warned on Tuesday.

"The possible use of chemical weapons would be completely unacceptable to the whole international community and I would expect an immediate reaction from the international community," Rasmussen said.

Speaking at the opening of a NATO meeting expected to approve Turkey's request for Patriot batteries to counter any Syrian threat, Rasmussen said Damascus' chemical weapons stockpiles were "a matter of great concern".

The heavy fighting around the capital - the heaviest since July - prompted the United Nations on Monday to announce it was withdrawing most of its international staff from Syria due to deteriorating security in the country.

The Britain-based Syrian Observatory for Human Rights said Tuesday's clashes between rebels and troops loyal to Assad were taking place in Beit Saham, Akraba and Yalda suburbs, as well as near the capital's international airport. The Observatory relies on reports from activists on the ground.

The Damascus suburbs, which have been opposition strongholds since the uprising against Assad began in March 2011, have been the scene of heavy fighting since last week following the start of an army offensive to regain lost territory around the capital.

Assad's forces have so far repelled major rebel advances on the capital, though their hold may be slipping.

Syria's official SANA news agency said a journalist for the state-run Tishrin newspaper was killed near his home in al-Tadhamon suburb of Damascus. Naji Assaad was "assassinated by an armed terrorist group" on his way to work, SANA said. The regime refers to rebels fighting to topple Assad as terrorists.

Syria is believed to have several hundred ballistic surface-to-surface missiles capable of carrying chemical warheads, and a US defence official said American and allied intelligence officials have detected activity around more than one of Syria's chemical weapons sites in the last week.

Syria's Foreign Ministry said on Monday that Syria "will not use chemical weapons - if there are any - against its own people under any circumstances".

The comments from the ministry came just hours after Lebanese security officials said Jihad Makdissi, the Foreign Ministry's spokesman, flew from Beirut to London.

It was not clear Tuesday whether Makdissi had defected. He is known for defending the regime's crackdown on dissent in fluent English.

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Crash driver five times over alcohol limit

A WOMAN was allegedly more than five times over the legal alcohol limit when she lost control of her car and crashed through two fences.

The 55-year-old was attempting a right hand turn in her Toyota Corolla in Mooroolbark, in Melbourne's east, just before 5.30pm (AEDT) when her car mounted the kerb.

It ploughed through a fence, narrowly missed a trampoline where a child had been playing minutes earlier, crashed through a second fence and came to rest against a caravan.

Police said a breath test returned a blood alcohol reading of 0.285 per cent.

Her licence was immediately suspended.

Senior Constable Aidan Williams said it was lucky the crash didn't end in tragedy.

"I am amazed that no one was injured in this incident," he said in a statement.

"There was a child jumping on the trampoline only minutes before this incident and a number of other cars on the road."

The woman, from Mooroolbark, will be summonsed to court at a date to be fixed on charges of drink driving and other traffic offences.

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Air strike kills 12 in Syrian border town

AN air strike has killed at least 12 people and wounded more than 30 in the northeastern Syrian town of Ras al-Ain.

The Syrian Observatory for Human Rights said on Monday four civilians and eight rebels were among the dead.

"The warplane hit the Mahata district in the southwestern part of the town. This area is controlled by the (jihadist) Al-Nusra Front, Ghuraba al-Sham and other rebel battalions," the British-based Observatory's Rami Abdel Rahman told AFP by phone.

The northeastern sector of the town, located in the mainly Kurdish province of Hasakeh, is controlled by Kurdish militias, he noted.

"A MIG aircraft made two consecutive bombing raids around 10.15am (local time)," a Ras al-Ain activist who identified himself as Hevidar said.

"These led to the deaths of nine civilians, including a child, not more than eight years old... and many of the wounded civilians were transported to hospitals in Turkey."

Many people who had recently returned to the town after being displaced during previous violence were forced to flee once again across the border, he added.

In unverified video footage posted on the internet by activists, a group of men wearing coats are seen pulling bloodied and limp bodies from beneath a pile of steel and other collapsed building materials.

A fire can be seen blazing in the background as the men load the bodies into the back of a truck.

Ras al-Ain was the scene of fierce clashes between fighters loyal to the Kurdish Democratic Union Party (PYD) - which has close ties to Turkey's rebel Kurdistan Workers' Party (PKK) - and the Al-Nusra Front and Ghuraba al-Sham in late November.

The Observatory, which relies on a network of activists, lawyers and medics, later reported clashes had died down after the two parties managed to strike an agreement.

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Thousands flee ahead of typhoon

A POWERFUL typhoon is barrelling towards the Philippines, prompting nearly 8000 people to leave their homes in coastal and low-lying areas.

Officials said on Monday Typhoon Bopha, packing winds of up to 210 kilometres an hour, was expected to hit the east coast of the major southern island of Mindanao overnight.

It is the strongest typhoon to hit the Philippines this year.

President Benigno Aquino said in a meeting with the heads of emergency services broadcast on television the area is expected to be hit between 4am and 6am (local time) on Tuesday.

"(Bopha's) destructive potential is no laughing matter. It is expected to be the strongest typhoon to hit our country in 2012. This would bring intense rainfall," he said.

He urged Filipinos potentially in harm's way to heed official warnings and monitor the government's hourly bulletins on the internet and other available means.

The centre of the typhoon was expected to hit the Mindanao coastal town of Hinatuan and nearby areas, said Blanche Gobenciong, regional director of the civil defence office in the area.

A total of 7885 Hinatuan residents have been moved to government shelters ahead of the arrival of the typhoon, she told reporters in a conference call.

Schools have been shut along Mindanao's east coast, while sea travel was banned for the time being, Gobenciong added.

Rescue officials said those living along the coast, flood-prone river valleys, as well as tiny islands off Hinatuan were most at risk.

As of 1000 GMT (2100 AEDT) the eye of the typhoon was 340km southeast of Hinatuan, the state weather service said.

After Hinatuan, it was expected to sweep northwest across the central islands.

Aquino said authorities have been stockpiling food supplies and rescue equipment, with military and coast guard personnel deployed in vulnerable areas amid fears the typhoon could trigger landslides and floods.

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Riot convictions quashed by court

TWO men found guilty of robbing an injured Malaysian student in an infamous incident caught on camera during the London riots, have had their convictions overturned.

Mobile phone footage of the crime against Ashraf Rossli, now 21, on August 8, 2011 was viewed by millions of people after being posted on YouTube.

Mr Rossli, who had suffered a broken jaw and was bleeding from the face, was seen being helped by two men posing as good samaritans. However, one of the men was seen rifling through the accountancy student's backpack, taking property later valued at more than $700.

In March 2012 John Kafunda and Reece Donovan were sentenced to five years and three-and-a-half years prison respectively for the crime.

However, in London last week convictions against Kafunda, now 23, and Donovan, now 25, were quashed by the Court of Appeal.

The men argued that it was not them in the video footage and appealed their convictions which they claim were based on the statements of anonymous witnesses.

The Crown Prosecution Service said it would not be seeking a retrial.

"Our application for witness anonymity for two witnesses in this trial was allowed by the judge. Without anonymity being given these witnesses would not have given evidence," a service spokesman said in a statement.

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90 in hospital after Singapore rig tilts

ABOUT 90 workers were sent to hospital on Monday after an oil rig being built at a shipyard in Singapore tilted to one side, forcing many of them to jump into the water, officials and witnesses said.

Sembcorp Marine, which owns the shipyard, said there were no fatalities but four workers were admitted to hospital for treatment and observation. The rest were treated for minor injuries or sent home.

"The shipyard is presently investigating the incident," it said in a statement to the Singapore Exchange.

Bangladeshi worker Jashim Faizal, 27, said he was doing electrical work on the rig at the height of about three storeys when the rig tilted.

"I jumped into the water. Hundreds of people jumped into the water with me," he told AFP at a hospital after being treated for a minor ankle injury.

"I saw many workers struggling to swim," he said, adding that he held on to a rope thrown by some of his colleagues and was pulled out.

Hawazi Daipi, senior parliamentary secretary for education and manpower, said the oil rig was being jacked up when one of the jacking mechanisms failed, resulting in it tilting over.

"I understand that all workers have been accounted for, and this is something we are very pleased with," he said.

Jurong Shipyard Pte Ltd is a wholly owned subsidiary of Sembcorp Marine Ltd, one of two major oil rig makers in Singapore, the other one being Keppel Corp.

Singapore makes most of the world's offshore oil rigs.

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Israel to withhold Palestine tax transfers

ISRAEL says it will withhold more than $US100 million ($A96.31 million) in taxes and other funds the Jewish state collects on behalf of Palestinians to punish them for their successful bid to win UN statehood.

Israel's Cabinet on Sunday also passed a resolution saying it would not negotiate on the basis of the UN General Assembly's recognition of a state of Palestine in the West Bank, east Jerusalem and Gaza Strip.

Finance Minister Yuval Steinitz said the government would use the money it was to transfer to the Palestinians to pay down their debt to the Israel Electric Corporation and other Israeli bodies.

This was the second act of reprisal by Israel.

On Friday, Israel announced it would press ahead with plans to build thousands of settler homes.

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Singapore deports striking bus drivers

SINGAPORE has deported 29 mainland Chinese bus drivers involved in the city-state's first industrial strike in 26 years.

The drivers, working for state-linked transport operator SMRT, staged the strike on Monday and Tuesday over a salary dispute and to demand better working conditions.

Their work permits had been revoked ahead of their deportation.

"The Ministry of Home Affairs confirms that all 29 former SMRT bus drivers have been repatriated to their home country," the ministry said in a statement on Sunday.

"They were co-operative and the process took place without incident," it said, adding that Chinese embassy officials and SMRT staff assisted in the repatriation.

Four other drivers were charged in court and authorities will lodge charges against a fifth one on Monday for their involvement in the work stoppage that was ruled as illegal by the government.

The strike, the first since 1986 which caught the government by surprise, has highlighted tightly-controlled Singapore's heavy dependency on migrant labour to drive its economic growth amid a labour shortage resulting from falling birth rates.

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Spain may not reach 2012 deficit goal

Furious Spaniards who say banks cheated them of their savings have taken to the streets. Source: AAP

PRIME Minister Mariano Rajoy says it will be difficult to meet the goal of cutting Spain's public deficit to 6.3 per cent of gross domestic product this year in line with European Union demands.

"It is very complicated to reduce the deficit by 2.6 points in a context of recession, with as many problems with revenue and such high financing costs," Rajoy told La Razon newspaper on Sunday.

"Spain was asked to make a very difficult effort, to go from 8.9 per cent to 6.3 per cent in only one year," said Rajoy, who has until now pledged to respect the deficit target.

"Our goal is to do things well and we will see what will happen at the end of the year," he said.

Spain, the fourth largest economy in the eurozone, is engaged in a deep austerity program and is seeking to recover 150 billion euros ($A188 billion) between 2012 and 2014, through both tax increases and budget cuts.

The task is all the harder as Spain slid back into recession at the end of 2011, less than two months after re-emerging from the previous one.

Since taking power after last November's huge election victory, Rajoy has introduced a series of tough spending cuts and tax rises to lower the deficit and stabilise Spain's public finances.

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Aussie chef killed in Peru crash

AN Australian chef has died after a head-on car crash in Peru.

The 26-year-old from the Gold Coast had recently opened a restaurant in Lima.

He was reportedly killed after colliding with an out-of-control truck in a remote rural region of southern Peru on Friday.

Three other people, including the man's girlfriend, were also killed in the crash.

The Department of Foreign Affairs is providing assistance to the man's family.

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Fire sparked at paper mill

ABOUT 50 fire fighters have battled for more than hour to control a blaze at a Melbourne paper mill.

The Metropolitan Fire Brigade responded to an alarm at the Amcor paper recycling factory at Alphington about 6.30pm (AEDT).

Crews found a large fire in a 100-metre long paper making machine on the first floor.

They took over an hour to control the blaze, the brigade said in a statement, adding that they were aided by 115 fire protection sprinkler heads protecting the machine and the Amcor on-site fire team.

The machinery was significantly damaged and some damage was also caused to the roof.

Crews will remain on scene throughout the night.

The fire started within a heat processing unit.

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