Exclusive: U.S. discloses secret Somalia military presence, up to 120 troops

By Phil Stewart

WASHINGTON (Reuters) - U.S. military advisors have secretly operated in Somalia since around 2007 and Washington plans to deepen its security assistance to help the country fend off threats by Islamist militant group al Shabaab, U.S. officials said.

The comments are the first detailed public acknowledgement of a U.S. military presence in Somalia dating back since the U.S. administration of George W. Bush and add to other signs of a deepening U.S. commitment to Somalia's government, which the Obama administration recognized last year.

The deployments, consisting of up to 120 troops on the ground, go beyond the Pentagon's January announcement that it had sent a handful of advisors in October. That was seen at the time as the first assignment of U.S. troops to Somalia since 1993 when two U.S. helicopters were shot down and 18 American troops killed in the "Black Hawk Down" disaster.

The plans to further expand U.S. military assistance coincide with increasing efforts by the Somali government and African Union peacekeepers to counter a bloody seven-year insurgent campaign by the al Qaeda-linked al Shabaab to impose strict Islamic law inside Somalia.

Those U.S. plans include greater military engagement and new funds for training and assistance for the Somali National Army (SNA), after years of working with the African Union Mission in Somalia, or AMISOM, which has about 22,000 troops in the country from Uganda, Kenya, Sierra Leone, Burundi, Djibouti and Ethiopia.

"What you'll see with this upcoming fiscal year is the beginning of engagement with the SNA proper," said a U.S. defense official, who declined to be identified. The next fiscal year starts in October.

An Obama administration official told Reuters there were currently up to 120 U.S. military personnel on the ground throughout Somalia and described them as trainers and advisors.

"They're not involved in combat," the official told Reuters, speaking on condition of anonymity, adding that until last year, U.S. military advisors had been working with AMISOM troop contributors, as opposed to Somali forces.

President Barack Obama last year determined that Somalia could receive U.S. military assistance.

Another official said American forces over the years had provided advice and assistance in areas related to mission planning, small unit tactics, medical care, human rights and communications. The official said U.S. forces in Somalia have also facilitated coordination, planning and communication between AMISOM troop contributors and Somali security forces.

SPECIAL OPS

The comments expand upon a little noticed section of a speech given early in June by Wendy Sherman, under secretary of state for political affairs. She publicly acknowledged that a "small contingent of U.S. military personnel" including special operations forces had been present in parts of Somalia for several years.

Still, it was not immediately clear from her remarks the extent to which U.S. personnel had been operating.

U.S. special operations forces have staged high-profile raids in the past in Somalia, including an aborted attempt in October to capture an al Shabaab operative in the militant group's stronghold of Barawe. U.S. officials have acknowledged Washington's support for AMISOM and Somalia's struggle against al Shabaab.

U.S. Central Intelligence Agency officials have been known to operate in the country.

U.S. troop numbers on the ground in Somalia vary over time, the officials told Reuters. Deployments are "staggered" and "short-term," one official said. But the Obama administration official added that there was overlap in the deployments to allow for a persistent presence on the ground.

Asked about where U.S. forces were deployed, the administration official said they were "in locations throughout Somalia" but declined to elaborate further for security reasons.

The official declined to say precisely when the first U.S. military forces went back into Somalia, saying: "It was around 2007" and in support of AMISOM.

Asked about why Sherman chose to disclose the information, a State Department official told Reuters: "In the past, our assessment of the security situation in Somalia informed our decision to err on the side of force protection concerns and not divulge their presence."

That's changed, the official said. "We do not currently believe that acknowledging the U.S. presence will increase the already high threat to our personnel and citizens operating in Somalia."

The announcement also reflects a deepening of the U.S.-Somali relationship and comes as the United States prepares to name its first ambassador for Somalia since 1993, who would initially be based out of the country due to security concerns.

"Absolutely there's been a shift" in the relationship, an Obama administration official said.

Military trainers from the European Union are already on the ground in Somalia training soldiers after shifting their operations at the end of last year to Mogadishu from Uganda, where troops were previously drilled.

(Additional reporting by Edmund Blair in Nairobi. Editing by Jason Szep and Peter Henderson)

• Politics & Government
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Iraq's Maliki hopes for government deal by next week

By Ahmed Rasheed and Alexander Dziadosz

BAGHDAD (Reuters) - Iraqi Prime Minister Nuri al-Maliki, who is fighting for his political life as a Sunni insurgency fractures the country, said on Wednesday he hoped parliament could form a new government in its next session after the first collapsed in discord.

Baghdad can ill afford a long delay. Large swathes of the north and west have fallen under the control of an al Qaeda splinter group that has declared it is setting up a "caliphate" and has vowed to march on the capital.

Yet the mounting concern and pressure from the United States, Iran, the United Nations and Iraq's own Shi'ite clerics have done little to end the paralyzing divisions between Iraq's main ethnic and sectarian blocs.

Sunnis and Kurds walked out of parliament's first session on Tuesday, complaining that Shi'ites had failed to nominate a prime minister; they see Maliki as the main obstacle to resolving the crisis and hope he will step aside.

Under the system put in place after the United States toppled Saddam Hussein in 2003, the premiership is traditionally given to a Shi'ite, while the speaker of the house has been a Sunni and the president, a largely ceremonial role, has been a Kurd.

In his weekly televised address, Maliki said he hoped parliament could next Tuesday get past its "state of weakness".

"God willing, in the next session we will overcome it with cooperation and agreement and openness," he said. "There is no security without complete political stability."

But it is far from clear when leaders in Baghdad might reach a consensus. All the main ethnic blocs are beset by internal divisions, and none has yet decided who to put forward for its designated position. Sunnis and Kurds say they want Shi'ites to choose a premier before they announce their nominees, while the Shi'ites say the Sunnis should first name the speaker.

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Iraq's Prime Minister Nuri al-Maliki walks to cast his ballot during parliamentary election in B …

"Each bloc has its own problems now," said Muhannad Hussam, a politician and aide to leading Sunni lawmaker Saleh al-Mutlaq.

If the Shi'ite bloc failed to replace Maliki, he said, there was a risk Sunni lawmakers would abandon the political process altogether. "There would be no more Iraq," he said.

NEED TO BE PATIENT

Longtime Maliki ally Sami Askari said forming a government could take until the end of Ramadan, the Muslim fasting month. But he played down the risk of the state collapsing, saying Maliki's caretaker government would continue to function.

"The reality is that we need to be patient," Askari said. "We will have a government in the end -- but not soon."

Residents of Baghdad were increasingly frustrated with the familiar sight of officials squabbling while the country burns.

"I'm so angry with all these politicians," said Dhamee Sattar Shafiq, a university statistics professor, shopping in a mixed neighborhood of Sunnis and Shi'ites.

"This country is headed for disaster and these men are just working for their own causes."

Down the road, Najaa Hassan, a 54-year-old carpenter, was similarly irritated. "Democracy has brought us many problems that we really don't need," he said.

Outside the capital, fighting flared again. Medical sources and witnesses said at least 11 people, including women and children, had been killed when Iraqi helicopters attacked Shirqat, 300 km (190 miles) north of Baghdad.

Witnesses said the helicopters were targeting a municipal building where militants were sheltering, and that the air strike also hit three nearby houses.

"We have received 11 bodies and 18 wounded from the helicopters' bombardment. Some children are in critical condition," said Hamid al-Jumaili, a doctor in Shirqat's hospital.

The prime minister's military spokesman, Lieutenant General Qassim Atta, made no specific mention of the incident but listed Shirqat as one of several locations where the air force had been active during the past 24 hours.

The government faces a formidable foe in the Islamic State, which shortened its name from the Islamic State in Iraq and the Levant this week and named its leader "caliph", the historical title of successors of the Prophet Mohammad who ruled the Muslim world.

"RED CIRCLE"

In his first comments since that declaration, the group's leader Abu Bakr al-Baghdadi on Tuesday called on Muslims across the world to take up arms and flock to the "caliphate", which spans territory that has fallen out of governmental control in Syria and Iraq.

The Islamic State has been working with an amalgam of other Sunni groups including Islamist militias, tribal fighters and former army officers and loyalists of Saddam Hussein, many of whom do not share its rigid ideology but are united by a sense of persecution under Maliki's Shi'ite-led government.

Maliki on Wednesday offered an amnesty to tribes who had taken up arms against the government, but excluded those who had "killed and shed blood".

The United Nations said on Tuesday more than 2,400 Iraqis had been killed in June alone, making the month by far the deadliest since the height of sectarian warfare during the U.S. "surge" offensive in 2007.

Maliki's government, bolstered by civilian volunteers and Shi'ite militias, has managed to stop the militant advance short of the capital, but has been unable to take back the cities that government forces abandoned. The army failed last week to take back Tikrit, 160 km (100 miles) north of Baghdad.

Even if Maliki steps aside - something that is still far from certain - few in Baghdad expect that will mean a swift resolution to the crisis.

"His departure would not solve the problem, because Sunnis and Shi'ites will stay at odds with each other and the animosity will continue," said Haidar Jumaa Zeboun, a 31-year-old construction worker in the district of Arasat.

Beyond that, there is deep strife within both the Sunni and Shi'ite communities.

Police and army in the Shi'ite shrine city of Karbala on Wednesday attempted to arrest a controversial cleric, Mahmoud al-Sarkhi, prompting hours of clashes with his followers, said local police spokesman Colonel Ahmed Al-Hasnawi.

(Reporting by Isra' al-Rubei'i, Ahmed Rasheed, Maggie Fick and Alexander Dziadosz in Baghdad; Writing by Alexander Dziadosz; Editing by Kevin Liffey)

• Politics & Government
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• Nuri al-Maliki
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Suspected Israeli revenge killing of Palestinian triggers clashes

By Noah Browning

JERUSALEM (Reuters) - The body of an abducted Palestinian youth was found in Jerusalem on Wednesday, raising suspicions he had been killed by Israelis avenging the deaths of three abducted Jewish teens.

News of the discovery of 16-year-old Mohammed Abu Khudair, who was last seen being bundled into a van earlier in the day, triggered clashes between rock-throwing Palestinians and Israeli police in the city.

Palestinian President Mahmoud Abbas accused Jewish settlers of killing Abu Khudair and demanded that Israel "mete out the strongest punishment against the murderers if it truly wants peace".

Israeli Prime Minister Benjamin Netanyahu urged police "to swiftly investigate who was behind the loathsome murder and its motive". He called on all sides "not to take the law into their own hands".

Police said they had found a body in the wooded outskirts of Jerusalem. Abu Khudair's father told Reuters the force had told him the body was his son.

An Israeli security source said Israel suspected the youth had been kidnapped and murdered, possibly in retribution for the killings of the Israeli teens. Their bodies were discovered on Monday, nearly three weeks after they were abducted in the occupied West Bank.

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Israeli army soldiers take positions during clashes with Palestinians in an early morning operation  …

Israel says Palestinian Hamas militants killed them. The Islamist group has neither confirmed nor denied the allegation.

The White House condemned the killing of Abu Khudair and called on Israel and the Palestinian Authority to "take all necessary steps to prevent an atmosphere of revenge and retribution."

Netanyahu convened his security cabinet later on Wednesday as violence also flared up across the Israel-Gaza border, with Palestinians firing at least a dozen rockets and mortars, and Israel's military carrying out an air strike.

WHITE VAN

Abu Khudair's cousin said the 16-year-old was grabbed off the street after leaving his home in Jerusalem's Arab neighbourhood of Shuafat to go to morning prayers with friends.

"Somebody ran into the house to say one of the boys had been dragged into a white van, so (Mohammed's) mother called the police," the cousin, Naima, said.

The abduction came a day after the three Jewish seminary students - Gil-Ad Shaer and U.S.-Israeli national Naftali Fraenkel, both 16, and Eyal Yifrah, 19 - were buried in a funeral attended by tens of thousands of mourners.

While the teenagers were laid to rest in the city of Modi'in, several hundreds Israeli demonstrators, some chanting "Death to Arabs", blocked the main entrance to Jerusalem.

Cries for revenge have echoed throughout the decades-old Israeli-Palestinian conflict.

They can be heard at the emotionally charged funerals of Palestinians killed by Israel, and the phrase "May God avenge his death" is often invoked at the burials of Israelis slain by Palestinians.

But deadly Israeli vigilante attacks, in declared retribution for Palestinian assaults, have been rare in recent years.

More common are the so-called "price tag" incidents in which mosques and Palestinian property are torched or damaged - originally a reference by ultra-nationalist Jews to making the government "pay" for any curbs on Jewish settlement on land Palestinians seek for a state.

Hebrew graffiti found on a building in the West Bank city of Nablus on Wednesday read: "Price tag, Jewish revenge."

Tensions were high in the West Bank, where around 40 Palestinians were arrested in raids on Tuesday, the latest in a campaign by Israel to cripple Hamas there.

Four people were wounded by live bullets early on Wednesday in an Israeli raid in the Palestinian city of Jenin.

Near Hebron, Israeli forces destroyed the home of a Palestinian arrested on charges of shooting dead an off-duty police officer in the West Bank in April.

Israel, which suspended the demolition policy in 2005 as a Palestinian uprising waned, says destroying the homes of Palestinians involved in attacks on Israelis has a deterrent effect. Rights groups have condemned the practice as collective punishment.

(Additional reporting by Ammar Awad, Ori Lewis, Maayan Lubell and Allyn Fisher-Ilan in Jerusalem, Nidal al-Mughrabi in Gaza and Ali Sawafta in Ramallah; Writing by Jeffrey Heller and Noah Browning; Editing by Larry King)

• Unrest, Conflicts & War
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U.S. increases security at overseas airports amid bomb concerns

By Mark Hosenball

WASHINGTON (Reuters) - The United States said on Wednesday it would increase security at overseas airports with nonstop flights to the country, and U.S. officials cited concerns al Qaeda operatives in Syria and Yemen were developing bombs that could be smuggled onto planes.

The new security measures would be required at airports in Europe, Africa and the Middle East that have direct flights, the U.S. officials told Reuters on condition of anonymity.

The Department of Homeland Security said "enhanced security measures" would be implemented in the next few days at "certain overseas airports with direct flights into the United States."

It did not specify which airports or what countries would be affected, nor did it say what triggered the extra precautions.

"We are sharing recent and relevant information with our foreign allies and are consulting the aviation industry," DHS Secretary Jeh Johnson said in a statement.

Johnson said he directed the Transportation Security Administration to implement the measures in the coming days. The move comes during the summer travel season and days before the July 4 holiday.

A U.S. official told Reuters some of the new measures would involve additional inspections of passengers' shoes and property.

The official said Washington had legal authority to enforce new security requirements on foreign governments or airports because the flights go directly to the United States.

Asked about the enhanced security steps in an interview with MSNBC on Wednesday night, Johnson said: "We continually evaluate the world situation and we not infrequently make changes to aviation security. We either step it up or we feel sometimes we're in a position to dial it back.

"So this is something that happens periodically and people should not overreact to it or overspeculate about what's going on," he said.

Adding there is "a terrorist threat to this country that remains," Johnson said: "We continually evaluate the world situation and if we think that there are improvements that we can and should make without unnecessarily disrupting the traveling public, we'll do that."

Earlier, law enforcement and security officials told Reuters the United States and European authorities were discussing measures that could include installation of additional bomb-detection machines.

Bombmakers from the Nusra Front, al Qaeda's affiliate in Syria, and Yemen-based Al Qaeda in the Arabian Peninsula, or AQAP, are believed to be working together to try to develop explosives that could avoid detection by current airport screening systems, U.S. national security sources said.

The main concern is that militant groups could try to blow up U.S.- or Europe-bound planes by concealing bombs on foreign fighters carrying Western passports who spent time with Islamist rebel factions in the region, the sources said.

'STEALTH EXPLOSIVES'

AQAP has a track record of plotting such attacks. It was behind a 2009 attempt by a militant with a bomb hidden in his underwear to blow up a Detroit-bound airliner.

There was no immediate indication U.S. intelligence had detected a specific plot or time frame for carrying out an attack. U.S. officials believe Nusra and AQAP operatives have carried out operational testing of new bomb designs in Syria, where Nusra is one of the main Islamist groups fighting to overthrow President Bashar al-Assad, a national security source said.

The "stealth" explosives the bombmakers are trying to design include non-metallic bombs, ABC News reported.

But officials are especially worried that the recent battlefield successes of the Islamic State in Iraq and the Levant, or ISIL, an al Qaeda splinter group, have drawn a growing number of militants from America and Europe to the jihadist cause and they would have easy access to flights headed for American cities.

(Additional reporting and writing by Matt Spetalnick and Doina Chiacu; Editing by Peter Cooney and Ken Wills)

• Politics & Government
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China urges U.S. to be more objective ahead of key meeting

BEIJING (Reuters) - China and the United States need to "plant more flowers, not thorns" in their relationship and Washington needs to have a more objective view about China, state media on Thursday quoted President Xi Jinping as saying ahead of a key meeting.

Xi, speaking to former U.S. Treasury Secretary Henry Paulson ahead of next week's China-U.S. Strategic and Economic Dialogue, said he hoped both countries could use such gatherings to keep "injecting positive energy" into the relationship.

"The two sides should expand common interests, deepen cooperation, plant more flowers, not thorns, clear the interference and avoid suspicion and confrontation," Xi was quoted as saying by the official China Daily.

China would stick to the path of peaceful development and shoulder its international duties, Xi added.

"We hope the U.S. will objectively view China's basic national conditions as well as its domestic and foreign policies," he said.

China and the United States, as the world's two largest economies, have close trade and business ties and work together on important international issues like North Korea.

But they also have deep differences, over everything from human rights to the value of the Chinese currency.

U.S. Treasury Secretary Jack Lew, who will attend the Strategic and Economic Dialogue in Beijing, said on Tuesday the yuan's value was a "very big issue" for the United States and that the currency needed to appreciate more.

U.S. Secretary of State John Kerry is also attending, and will likely have to address Chinese concerns over what Beijing views as Washington's support for Japan, Vietnam and the Philippines over their territorial disputes with China.

China's increasingly assertive tone in the disputed East and South China Seas, as well as its rising military expenditure, have rattled nerves in the region and in Washington.

(Reporting by Ben Blanchard; Editing by Nick Macfie)

• Politics & Government
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Benghazi attack suspect has been talking to U.S. interrogators: officials

By Mark Hosenball

WASHINGTON (Reuters) - A Libyan militant accused of involvement in the 2012 attacks on U.S. government installations in Benghazi, Libya, has been talking to U.S. interrogators, U.S. officials familiar with the matter said.

Ahmed Abu Khatallah, captured in Libya on June 15 by a U.S. military and FBI team, has been interrogated both before and after he was advised of his right under U.S. law to remain silent, they said.

Abu Khatallah was transferred over the weekend to a federal prison in Alexandria, Virginia, from the U.S. Navy ship where he had been held since his capture, the officials said.

While aboard the USS New York, Abu Khatallah was interrogated first by a team of elite counterterrorism experts, known as the High Value Detainee Interrogation Group (HIG), without being read his "Miranda Rights", a procedure in U.S. criminal cases under which a suspect is advised that he has the right to remain silent and to consult a lawyer.

He was later advised of his rights, the officials said. On Saturday, he was brought into federal court in Washington, where he pleaded not guilty to a terrorism conspiracy charge related to the Benghazi attack. [ID:nL2N0P909Q]

One of the officials familiar with the case said U.S. authorities believed Abu Khatallah led the attack. Another official said he was "not the only ringleader."

Evidence linking Abu Khatallah to the attack includes video images, two officials said.

Abu Khatallah, in media interviews before his arrest, denied involvement in the Benghazi attacks.

The United States has not arrested any other suspects in the attack on a U.S. consular compound and CIA base in Benghazi on Sept. 11, 2012. Four Americans, including Christopher Stevens, the U.S. ambassador to Libya, were killed in the attack.

A spokesman for the U.S. Marshals Service declined to discuss where Abu Khatallah was being held, saying it was the agency's policy not to discuss the locations of high-profile prisoners.

However, other sources said that he was being held in Alexandria in the same prison where Zacharias Moussaoui, a French citizen linked to the Sept. 11, 2001, attacks on New York and Washington, was held during proceedings against him at a nearby federal courthouse.

(Reporting By Mark Hosenball; Editing by Caren Bohan and Mohammad Zargham)

• Crime & Justice
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Ukraine's forces attack rebel positions; Putin growls

Ukrainian forces struck at pro-Russian separatist bases in eastern regions with air and artillery strikes on Tuesday after President Petro Poroshenko announced he would not renew a ceasefire but go on the offensive to rid Ukraine of "parasites".

His decision quickly drew fire from Russian President Vladimir Putin who said Poroshenko had disregarded the advice of himself and German and French leaders. Putin said Poroshenko would now have to bear full responsibility for veering off the road to peace.

Repeating a threat he made in March when Russia annexed Crimea, Putin said Moscow would continue to defend the interests of ethnic Russians abroad - up to 3 million of whom live in the east of Ukraine, which has been in separatist ferment since April.

The United States said the separatists had not abided by the ceasefire and Poroshenko had "a right to defend his country".

Within hours of Poroshenko's early morning announcement, his military went into action against rebel bases and checkpoints, bombarding them from the air and with artillery.

"The terrorists' plan to significantly escalate armed confrontation has been disrupted and the threat of losses to the civilian population and service personnel has been liquidated," the Defence Ministry said.

There was no immediate word on casualties.

Poroshenko, who accuses Russia of fanning the conflict and allowing fighters and equipment to cross the border to support the rebels, turned his back on another renewal of a 10-day unilateral ceasefire after the phone talks involving Putin, German Chancellor Angela Merkel and French President Francois Hollande.

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An armed pro-Russian separatist (L) stands guard at a check point as a man riding a bicycle passes b …

Showing impatience at what he had heard from Putin, Poroshenko said in his early morning statement that Ukraine had not seen "concrete steps for de-escalating the situation, including strengthening controls on the border".

Poroshenko, just over three weeks in office, faces a possible popular backlash at home over military losses during the ceasefire and was under pressure to switch to more forceful action against the rebels.

A French diplomatic source said the Russian, Ukrainian, German and French foreign ministers would meet in Berlin on Wednesday to try to push forward peace initiatives to resolve the crisis in Ukraine.

'MILITANTS AND MARAUDERS'

Many of Poroshenko's security advisers told him that the rebels had used the June 20 ceasefire, renewed for three days on June 27, to regroup and rearm.

A statement tweeted by the Ukrainian Foreign Ministry on Monday, as Poroshenko went into talks with his security chiefs, said 27 Ukrainian servicemen had been killed and 69 wounded since the start of the ceasefire.

Announcing the military would now act to answer the "terrorists, militants and marauders", Poroshenko accused the rebels of failing to keep to the truce or follow a peace plan he had outlined. Later on his Facebook page, the 48-year-old leader warned the future would be difficult, adding: "We must be united, because we are fighting to free our land from dirt and parasites."

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Ukrainian President Petro Poroshenko takes part in a meeting of the Security Council in Kiev June 16 …

Putin bluntly suggested Poroshenko had been isolated in Monday's phone-in with himself, Merkel and Hollande.

"Unfortunately President Poroshenko took the decision to restart military operations and we – I mean myself and my European colleagues – could not convince him that the road to stable, strong and long-lasting peace does not lie through war," he said.

"Up until now (Poroshenko) was not directly linked to the order to start military operations but now he has taken on this responsibility fully, not only militarily but also politically," Putin said.

It was not immediately known whether Berlin and Paris agreed with this version of Monday's discussions.

U.S. State Department spokeswoman Marie Harf said Washington supported Poroshenko's move.

"It takes two to keep a ceasefire," she told a regular news briefing. "President Poroshenko put in place a seven-day ceasefire; he abided by it, but the fact remains that the separatists, many of them weren't adhering to it, and he has a right to defend his country."

She said U.S. Secretary of State John Kerry had spoken on Monday to Poroshenko, who had said he was still committed to a peace plan.

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Ukraine's President Petro Poroshenko attends a news conference at the EU Council in Brussels Jun …

"So the ultimate goal here is to get back to a ceasefire, to get back to a peace plan, but it takes two parties to put that in place and to keep it in place," Harf said.

Before Putin spoke, the Russian Foreign Ministry hinted that the United States was behind Poroshenko's decision. "There is an impression that the change in Kiev's position ... could not have come about without influence from abroad, despite the position of leading EU member states," it said in a statement.

The U.S. State Department said Kerry, in a call with Russian Foreign Minister Sergei Lavrov on Tuesday, "expressed strong concern about the refusal of Russian-supported separatists to take the necessary steps and provide the kinds of assurances that would have enabled an extension of the ceasefire and stressed the importance of taking steps to de-escalate."

Kerry also made clear the United States and its partners would "continue to press Russia to end all support and weapons flowing to separatists, to do more to control the border, to call on separatists to lay down their arms, to return the border checkpoints they hold to Ukrainian government control, and to release all remaining hostages," the State Department statement said.

AIR STRIKES, ARTILLERY

Ukrainian military spokesman Oleksiy Dmytrashkovsky said: "After the president's (Poroshenko's) speech, the ATO (Anti-Terrorist Operation) went into action. We opened artillery fire, carried out air strikes at the strategic points of the terrorists and places where they are concentrated."

Rebels had fired on an SU-25 attack aircraft, damaging it, but the plane had managed to land safely at its base, he said. He denied a rebel report that a military helicopter had been brought down.

One Ukrainian serviceman had been killed and 17 wounded in the past 24 hours in rebel attacks on Ukrainian posts, Dmytrashkovsky said.

Poroshenko expressed willingness to return to a ceasefire if it became clear all sides were ready to carry out all aspects of the peace plan, including the freeing of hostages and creating effective border controls.

He had extended a government ceasefire last week until 10 p.m. (1900 GMT) on Monday to allow for peace talks with a contact group involving separatist leaders, a former Ukrainian president, a senior representative of the OSCE rights and security body and Moscow's ambassador to Kiev.

"The unique chance to implement the peace plan was not realized. It happened because of the criminal actions of the militants. They publicly declared their unwillingness to support the peace plan as a whole and in particular the ceasefire," Poroshenko said.

Pro-Russian separatism erupted in Ukraine's east in April after street protests in Kiev toppled a Moscow-backed president, Viktor Yanukovich, when he had walked away from a free-trade deal with the European Union that would shift Ukraine westwards.

Russia subsequently annexed Crimea and separatist rebels in Ukraine's Russian-speaking east seized buildings and strategic points, declaring "people's republics" and saying they wanted union with Russia.

Poroshenko, defying threats by Russia to carry out retaliatory trade action, on Friday signed the EU deal that Yanukovich had baulked at.

Moscow could face more penalties from the EU on top of existing asset freezes and visa bans unless pro-Russian rebels act to wind down the crisis in the Ukraine's Donetsk and Luhansk provinces.

(Additional reporting by Katya Golubkova, Timothy Heritage, Alexei Anishchuk and Alissa de Carbonnel in Moscow, Thomas Grove in Kiev, Maria Tsvetkova in Slaviansk, Justyna Pawlak and Adrian Croft in Brussels, John Irish in Paris, and David Brunnstrom in Washington; Editing by Peter Millership, Paul Simao, Peter Cooney and Mohammad Zargham)

• Politics & Government
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Sunnis, Kurds shun Iraq parliament

By Raheem Salman and Oliver Holmes

BAGHDAD (Reuters) - Sunnis and Kurds walked out of the first session of Iraq's new parliament on Tuesday after Shi'ites failed to name a prime minister to replace Nuri al-Maliki, dimming any prospect of an early national unity government to save Iraq from collapse.

The United States, United Nations, Iran and Iraq's own Shi'ite clergy have pushed hard for politicians to come up with an inclusive government to hold the fragmenting country together as Sunni insurgents bear down on Baghdad.

The leader of the al Qaeda offshoot spearheading the insurgency, the Islamic State, has declared a "caliphate" in the lands it has seized in Iraq and Syria. Its leader vowed on Tuesday to avenge what he said were wrongs committed against Muslims worldwide.

Despite the urgency, the Iraqi parliament's first session since its election in April collapsed when Sunnis and Kurds refused to return from a recess to the parliamentary chamber after Shi'ites failed to name a prime minister.

Parliament is not likely to meet again for at least a week, leaving Iraq in political limbo and Maliki clinging to power as a caretaker, rejected by Sunnis and Kurds.

Under a governing system put in place after the removal of Saddam Hussein, the prime minister has always been a member of the Shi'ite majority, the speaker of parliament a Sunni and the largely ceremonial president a Kurd.

The Shi'ite bloc known as the National Alliance, in which Maliki's State of Law coalition is the biggest group, has met repeatedly in recent days to bargain over the premiership but has so far been unable either to endorse Maliki for a third term or to name an alternative.

Fewer than a third of lawmakers returned from the recess. Sunni parties said they would not put forward their candidate for speaker until the Shi'ites pick a premier. The Kurds have also yet to nominate a president.

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Members of the new Iraqi parliament attend a session at the parliament headquarters in Baghdad July  …

Osama al-Nujaifi, a leading Sunni politician, former speaker and strong foe of Maliki, warned that "without a political solution, the sound of weapons will be loud, and the country will enter a black tunnel".

He said his bloc did not have a candidate for a speaker so far and was waiting to see who the National Alliance would nominate for prime minister.

"If there is a new policy with a new prime minister, we will deal with them positively. Otherwise the country will go from bad to worse," Nujaifi said.

Shi'ite lawmakers sought to shift blame to the Sunni and Kurdish blocs, saying the premiership was the last position to be named in the constitutionally-defined process. 

Mehdi al-Hafidh, parliament's oldest member who is tasked by the constitution with chairing the legislature's meetings until a speaker is named, said the next session would be held in a week, if agreement was possible after discussions.

FIGHTING RAGES

Baghdad can ill-afford further delays. Government troops have been battling for three weeks against fighters led by the group formerly known as the Islamic State in Iraq and the Levant (ISIL). This week it shortened its name to the Islamic State and declared its leader "caliph" - historic title of successors of the Prophet Mohammad who ruled the whole Muslim world.

Speaking for the first time since then, the group's leader Abu Bakr al-Baghdadi vowed revenge for what he said were wrongs committed against Muslims, calling on fighters to avenge them

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Members of the new Iraqi parliament recite an oath at the parliament headquarters in Baghdad July 1, …

"Your brothers, on every piece of this earth, are waiting for your rescue," Baghdadi purportedly said in an audio message that was posted online, naming a string of countries from Central African Republic to Burma where he said violations were being committed against Muslims.

"By Allah, we will take revenge, by Allah we will take revenge, even if after a while," he said in the Ramadan message. Baghdadi also called on Muslims to immigrate to the "Islamic State", saying it was a duty.

Fighting has raged in recent days near former dictator Saddam Hussein's home city, Tikrit, north of Baghdad. ISIL also controls suburbs just west of the capital and clashes have erupted to the south, leaving the city of 7 million confronting threats from three sides.

The United Nations said on Tuesday more than 2,400 Iraqis had been killed in June alone, making the month by far the deadliest since the height of sectarian warfare during the U.S. "surge" offensive in 2007.

In a reminder of that conflict, mortars fell near a Shi'ite holy shrine in Samarra which was bombed in 2006, unleashing the sectarian bloodshed that killed tens of thousands over the next two years. Samarra, north of Baghdad, is now held by Baghdad's troops with ISIL in the surrounding countryside.

Violence also struck the capital, where police found two bodies with their hands tied behind their back and bullet wounds in the head and chest in the mainly Shi'ite neighborhood of Shula, police and medical sources said. 

A bomb went off in Baghdad's western Jihad district, killing two passersby and wounding six more, police and medics said. 

The insurgents' advance has triggered pledges of support for Baghdad from both Washington and Tehran.

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Iraqi policemen take their positions during an intensive security deployment on the al-Falahat bridg …

On Tuesday, Iran's deputy foreign minister said his country had not received any request for weapons from Baghdad but was ready to supply them if asked.

Iraq also flew Russian-made Sukhoi Su-25 jets delivered on Saturday for the first time, state television reported, although there was no independent confirmation.

Saudi Arabia pledge $500 million in humanitarian aid for Iraqis to be disbursed through U.N. agencies, a Saudi Press Agency statement said.

SHOUTING MATCH

Parliament opened its first session with an orchestra playing the national anthem and the recitation of a Quranic verse emphasizing unity. Hafidh called on lawmakers to confront the crisis.

"The security setback that has beset Iraq must be brought to a stop, and security and stability have to be regained all over Iraq, so that it can head down the path in the right way toward the future," he said.

Lawmakers stood at the arrival of Maliki, who waved to his long-time foe Nujaifi and shook hands with Saleh al-Mutlaq, another leading Sunni politician.

But anger among the three main ethnic and sectarian groups soon flared when a Kurdish lawmaker accused the government of withholding salaries for the Kurds' autonomous region. Kadhim al-Sayadi, a lawmaker in Maliki's list, shouted back that Kurds were taking down Iraqi flags.

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Iraqi security forces ride on vehicles during an intensive security deployment in the town of Jurf a …

"The Iraqi flag is an honor above your head. Why do you take it down?" he shouted. "The day will come when we will crush your heads."

The dramatic advance by ISIL, which has dominated swathes of territory in an arc from Aleppo in Syria to near the western edge of Baghdad in Iraq, has stunned Iraq and the West. The group and allied militants seized border posts, oilfields and northern Iraq's main northern city Mosul in a lightning offensive in June.

Other Iraqi Sunni armed groups which resent what they see as persecution under Maliki are backing the insurgency.

Kurds have taken advantage of the advance to seize territory, including the city of Kirkuk, which they see as their historic capital and which sits above huge oil deposits.

Results of April's elections initially suggested parliament would easily confirm Maliki in power for a third term. But with lawmakers taking their seats after the collapse of the army in the north, politicians face a more fundamental task of staving off a breakup of the state.

Maliki's foes blame him for the rapid advance of the Sunni insurgents. Although Maliki's State of Law coalition won the most seats, it still needs allies to govern. Sunnis and Kurds demand that he go, arguing he favors his own sect, inflaming the resentment that fuels the insurgency.

The United States has not publicly called for Maliki to leave power but has demanded a more inclusive government in Baghdad as the price for more aggressive help.

DEADLINE PASSES

Washington has so far pledged 300 mainly special forces advisers and said on Monday it was sending a further 300 troops to help secure the embassy and Baghdad airport.

Maliki's government, with the help of Shi'ite sectarian militias, has managed to stop the militants short of the capital but has been unable to take back cities its forces abandoned.

The army attempted last week to take back Tikrit but could not recapture the city, 160 km (100 miles) north of Baghdad, where ISIL fighters had machine-gunned scores of soldiers in shallow graves after capturing it on June 12. Residents said fighting raged on the city's southern outskirts on Monday.

On Friday, in an unusual political intervention, Grand Ayatollah Ali al-Sistani, Iraq's most senior Shi'ite cleric, called on political blocs to name the prime minister, president and speaker before parliament met on Tuesday.

Now that deadline has passed, a prominent Shi'ite lawmaker told Reuters he expected Sistani to keep up the pressure.

Maliki's close friends say he does not want to relinquish power, although senior members of his State of Law coalition have told Reuters an alternative premier from within his party was being discussed. Rival Shi'ite groups also have candidates.

Many worry that a drawn-out process will waste precious time in confronting the militants, who have vowed to advance on Baghdad. A Shi'ite lawmaker, speaking on condition of anonymity, said: "Things are bad. The political process is not commensurate with the speed of military developments."

(Additional reporting by Isra' al-Rubei'i, Ahmed Rasheed, Ned Parker and Alexander Dziadosz in Baghdad and Gabriela Baczynska in Moscow and Yara Bayoumy in Dubai; Writing by Alexander Dziadosz; Editing by Peter Graff, Paul Taylor and Anna Willard)

• Politics & Government
• Unrest, Conflicts & War
• Islamic State
• Iraq
• Baghdad

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France's Sarkozy faces corruption probe in blow to comeback hopes

By Gregory Blachier and Gérard Bon

PARIS (Reuters) - Former French President Nicolas Sarkozy was placed under formal investigation on Wednesday, the prosecutor's office said, on suspicions he tried to use his influence to thwart an investigation of his 2007 election campaign.

The step, which often but not always leads to trial, is a major setback to Sarkozy's hopes of a comeback after his 2012 election defeat by Socialist rival Francois Hollande. The conservative politician denies all wrongdoing in a string of investigations in which he is either directly or indirectly implicated.

Investigating magistrates are looking to see whether Sarkozy used his influence to secure leaked details of an inquiry into alleged irregularities in his victorious 2007 election campaign. He is suspected of influence peddling, corruption and benefiting from "the breach of professional secrets," the prosecutor's office said.

Sarkozy, 59, was held in police custody in the Paris suburb of Nanterre for nearly 15 hours before being transferred to a Paris court, where he met with investigating magistrates. He was released around midnight GMT.

Sarkozy's attorney and a judge involved in the case were similarly placed under formal investigation on suspicion of influence peddling, their attorneys said.

"These events only rely on phone taps ... whose legal basis will be strongly contested," said Paul-Albert Iweins, the attorney for Sarkozy's attorney, Thierry Herzog.

"There's not a lot in this dossier, since none of the material elements of what I've seen, and what we could contest, support the accusations," he said.

Placing a suspect under formal investigation means there exists "serious or consistent evidence" pointing to probable implication of a suspect in a crime.

Influence-peddling can be punished by up to five years in prison and a fine of 500,000 euros ($682,000).

It was the second time the ex-president, who lost presidential immunity from legal prosecution a month after he left office in June 2012, was placed under such a judicial probe. The first occurred in 2013 but magistrates later dropped the case against him.

WEB OF INQUIRIES

There are six legal cases, including this one, hanging over the ex-president's head, a shadow that many in his UMP party believe compromises his ability to lead a comeback in 2017.

The current questioning relates to suspicions he used his influence to get information on an investigation into funding irregularities in his victorious 2007 election campaign.

Specifically, magistrates will seek to establish whether Sarkozy tried to get a judge promoted to the bench in Monaco in exchange for information on that campaign finance inquiry.

Last October, magistrates dropped a formal investigation into Sarkozy's role in irregularities in that 2007 campaign, and whether he had exploited the mental frailty of France's richest woman, L'Oreal heiress Liliane Bettencourt, to fund it.

But as investigators used phone-taps to examine separate allegations that late Libyan leader Muammar Gaddafi funded the same campaign, they began to suspect he had kept tabs on the Bettencourt case through a network of informants.

Those suspicions finally prompted police to launch an inquiry in February, which led to Wednesday's formal investigation. Under French law, a suspect is not technically charged with a crime until later in the process.

Sarkozy has remained coy about his plans for a comeback, but has been widely believed to be laying the groundwork for it.

Sarkozy remains the favorite of conservatives to challenge Hollande but he is widely detested by left-wingers and his abrasive style alienated many middle-of-the-road voters.

(Writing by Alexandria Sage; Editing by Lisa Shumaker)

• Crime & Justice
• Society & Culture
• Francois Hollande

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Suicide bomber kills four Afghan air force officers in Kabul: police

KABUL (Reuters) - A suicide bomber killed four Afghan air force officers and wounded five on Wednesday when he detonated his explosives near a bus carrying military personnel in the capital, Kabul, police said.

The bomber's target was the bus, said Hashmat Stanekzai, a spokesman for Kabul's police chief.

The explosion happened in the heavily secured downtown area near Kabul University amid heightened political tensions over the disputed second round of the Afghan elections.

(Reporting by Mirwais Harooni; Writing by Katharine Houreld; Editing by Nick Macfie)

• Politics & Government
• Unrest, Conflicts & War
• Kabul University
• suicide bomber

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