UPDATE 7-Key parts of Arizona anti-immigration law blocked

PHOENIX, July 28 (Reuters) – A U.S. judge on Wednesday blocked key parts of Arizona’s tough new immigration law hours before it was to take effect, handing a victory to the Obama administration as it tries to take control of the issue.

Arizona Governor Jan Brewer said she would file an appeal to reinstate the provisions, which had popular support but were opposed by President Barack Obama and immigration and human rights groups.

“This fight is far from over,” Brewer said, adding that “at the end of what is certain to be a long legal struggle, Arizona will prevail in its right to protect our citizens.”

The Republican-controlled state legislature passed the law three months ago to try to drive nearly half a million illegal immigrants out of Arizona and stem the flow of human and drug smugglers over the border from Mexico.

The provisions blocked by U.S. District Judge Susan Bolton included one that required a police officer to determine the immigration status of a person detained or arrested if the officer believed the person was not in the country legally.

Bolton also halted provisions requiring immigrants to carry their papers at all times and making it illegal for people without proper documents to tout for work in public places.

Immigration as an issue has festered in U.S. politics for years and attempts to overhaul the system have failed, most recently in 2007 when Republicans torpedoed reforms pushed by George W. Bush, then the Republican president.

The ruling is a significant victory for Obama, who wants to break the deadlock with Republicans to pass a comprehensive immigration law tightening border security and giving millions of illegal immigrants a shot at legal status — an already difficult task before November’s congressional elections.

There are an estimated 10.8 million illegal immigrants in the United States, a country of more than 300 million people.

The Justice Department had argued provisions of the Arizona law, which goes into effect on Thursday, encroached on federal authority over immigration policy and enforcement.

In her 36-page decision, Bolton agreed, finding “the United States is likely to suffer irreparable harm” if her court did not block the selected parts of the law.

“The number of requests that will emanate from Arizona as a result of determining the status of every arrestee is likely to impermissibly burden federal resources and redirect federal agencies away from the priorities they have established,” she said.

COULD GO TO SUPREME COURT

Bolton kept some parts of the law, including provisions making it illegal for drivers to pick up day laborers off the street and to transport or harbor an illegal immigrant.

Brewer said her state “will soon file an expedited appeal” with the U.S. Court of Appeals for the Ninth Circuit.

Arizona can appeal ultimately to the U.S. Supreme Court. In that case, it could embroil the cash-strapped desert state in a protracted and costly legal battle.

“There are no winners here,” said Representative Ann Kirkpatrick, an Arizona Democrat who faces a tough battle for re-election in November. “No matter what the courts ultimately decide, we will still have wasted millions of dollars and our borders will still not be secure.”

John McCain and Jon Kyl, Arizona’s Republican U.S. senators, said they were “deeply disappointed” by the ruling and took aim at Obama for failing to provide resources to secure the state’s porous border with Mexico.

“Instead of wasting taxpayer resources filing a lawsuit against Arizona … the Obama administration should have focused its efforts on working with Congress to provide the necessary resources to support the state in its efforts to act where the federal government has failed,” their statement said.

McCain, a Republican moderate, faces a tough challenge in the party’s state primary election from former congressman J.D. Hayworth, a conservative who is hawkish on border issues.

About three dozen Hispanic activists at an open-air mass outside the state capitol in central Phoenix jumped up, hugged and wept as news of Bolton’s ruling broke.

“I think that our efforts have paid off,” said Dulce Matuz, a college graduate who has lived in Arizona without papers for a decade, adding activists would carry on fighting to overturn the rest of the law.

The Mexican government hailed the ruling as a “step in the right direction.” Around 100 activists cheered and chanted “Yes we can” and “No to xenophobia” as news of the ruling reached a rally outside the U.S. embassy in Mexico City.

“WIND OUT OF SAILS”

Peter Spiro, a law professor at Temple University and a former attorney in the State Department, said he was not surprised the more controversial parts of the law were halted.

“I expect those provisions will never go into effect, though this is only a preliminary order,” Spiro said.

“I also think this will take the wind out of the sails of anti-immigration efforts on the state level, though it will probably intensify such efforts at the federal level.”

Polls show the Arizona law is backed by a solid majority of Americans and 65 percent of the state’s voters. It is inspiring copycat efforts in at least 20 other states.

Obama supports allowing illegal immigrants in good standing to pay a fine, learn English and get on track to citizenship. He also has supported tightening border security and clamping down on employers that hire undocumented workers.

Opponents of the Arizona law say it will lead to harassment of Hispanic or Hispanic-looking Americans. Thousands were headed to Phoenix for protests on Thursday, when the law takes effect, and street rallies were planned across the country.

Police arrested four activists late on Wednesday, after they scaled a crane in downtown Phoenix and unfurled a banner reading “Stop the Hate.” They faced trespassing charges, a police spokesman said.

Police across Arizona, the main corridor for human and drug smugglers entering the United States from Mexico, have been preparing to implement the law. The state’s 15,000 officers have had training on how to identify people they suspect are unlawfully in Arizona without resorting to racial profiling.

Maricopa County Sheriff Joe Arpaio, known for his tough approach to illegal immigrants in the Phoenix area, said he would push ahead with plans for a crime and immigration sweep on Thursday regardless of limitations placed on the law.

“It’s business as usual for this sheriff’s office,” Arpaio said. “All these protesters coming here from everywhere and the local critics aren’t going to change the way Arizona or this sheriff will fight our illegal immigration problem.” (Additional reporting by Carolina Madrid in Phoenix, Jeremy Pelofsky in Washington, Caroline Stauffer and Missy Ryan in Mexico City; Editing by John O’Callaghan)

Tottenham held to 0-0 in North American tour opener

(Reuters) – English Premier League club Tottenham Hotspur were held to a scoreless draw by the San Jose Earthquakes in the opening match of their pre-season tour of the United States on Saturday.

Both teams created opportunities, with Robbie Keane having a goal disallowed for offside then missing perhaps the best chance for Spurs, but neither was able to break the deadlock.

The north London club were missing most of their World Cup players and they looked rusty as they began their preparation for the start of the Premier League next month.

Their next game is against New York Red Bulls on Thursday, where they are likely to face a familiar foe in former Arsenal striker Thierry Henry who joined New York last week.

The final tour game will be against Portuguese side Sporting Lisbon on July 25.

(Reporting by Julian Linden in New York; Editing by Greg Stutchbury; To query or comment on this story email sportsfeedback@thomsonreuters.com)

Nikkei inches lower, eyes on yen and U.S. earnings

TOKYO, July 12 (Reuters) – Japan’s Nikkei average inched lower on Monday as the yen pared its losses and exporters gave up some gains, although the technical picture was brightening.

Market players said the government’s election battering had been largely priced in although worries about policy deadlock could keep further advances in check, with attention now shifting to overseas factors such as the imminent U.S. earnings season.

The ruling Democratic Party’s thrashing in an election on Sunday could thwart efforts to curb a huge public debt and get the economy in shape, and put Prime Minister Naoto Kan’s job at risk. [ID:nTOE66A02V]

“The election results are neither negative nor positive, but what we wanted most was stability in politics — and that seems impossible for now,” said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

The benchmark Nikkei spent most of the day in positive territory after a negative start due to profit-taking in some exporter shares, edging higher on rises on Wall Street and expectations for U.S. earnings.

“I think U.S. shares are likely on a rising trend, which Japanese shares will follow, but a lot of this is based on market hopes for earnings,” said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Morgan Stanley Securities.

“If companies like Alcoa and Intel come in below expectations, this could set off selling.”

Alcoa (AA.N) reports on Monday and a raft of other firms, including Intel Corp (INTC.O), later this week.

But U.S. stock futures SPc1 slipped in later trade, weighing on shares, while the dollar slipped back below 89 yen JPY=.

In thin trade, the Nikkei ultimately slipped 0.4 percent or 37.21 points to 9,548.11. The broader Topix also shed 0.4 percent.

Receding pessimism about the global economy helped the Nikkei rise 4.1 percent last week despite hitting a seven-month low during that period.

The Nikkei’s next upward target is around 9,660, its 25-day moving average, which is a proxy for a one-month moving average that is closely watched in Japan. The next target lies around 10,250, roughly the level of its June high.

Technically, the picture for the Nikkei is brightening.

Its MACD, a measure of market momentum, is heading up after a bullish cross, while its slow stochastic — a measure of how oversold the market is and whether it is in a short-term up or down trend — has been climbing after a fall in June.

YEN PARES LOSSES

Though the dollar at one point rose above 89 yen, it gave up part of those gains by later trade — as did the euro, which edged down 0.1 percent to 111.84 yen EURJPY=R. Investors welcome a weaker yen as it boosts exporter profits when repatriated. [FRX/]

Sony Corp (6758.T) trimmed gains slightly as a result but still rose 3.6 percent to 2,532 yen. Honda Motor Co (7267.T) gained 3.1 percent to 2,687 yen.

But others fell, with Tokyo Electron (8035.T) down 1.7 percent at 4,830 yen and Canon Inc (7751.T) losing 0.9 percent to 3,450 yen.

Banks lost ground, with top lender Mitsubishi UFJ Financial Group (8306.T) falling 2.1 percent to 417 yen and No. 2 bank Mizuho Financial Group (8411.T) down 2.8 percent at 138 yen.

Gree (3632.T), an operator of game sites for mobile phones, fell 1.1 percent to 6,200 yen after Mitsubishi UFJ Morgan Stanley Securities cut its rating on the firm by two notches, to “3″ from “1″, and lowered the target price to 6,750 yen from 7,200 yen.

Shares of steelmakers and shipping firms gained after data showed China’s trade surplus in June topped expectations on surprising strength in exports, suggesting the global economic recovery remains on track despite worries about a fresh slowdown. [ID:nTOE669009]

Nippon Steel Corp (5401.T), the world’s second-biggest steelmaker, rose 2.3 percent to 308 yen and JFE Holdings Inc (5411.T) advanced 1.6 percent to 2,770 yen.

Shipper Kawasaki Kisen (9107.T) rose 1.1 percent to 368 yen.

Some 1.60 billion shares changed hands on the Tokyo exchange’s first section, its lowest volume in a week. Declining stocks outnumbered advancing ones, 984 to 524.

Japan PM’s party at risk of setback in Sunday vote

July 11 (Reuters) – Japan’s ruling coalition could lose control of parliament’s upper house in an election on Sunday that could stall efforts to curb a huge public debt and ultimately put Prime Minister Naoto Kan’s job at risk.

Sagging support for the leading Democratic Party of Japan (DPJ), which surged to power for the first time last year, rebounded after Kan — Japan’s fifth leader in three years — replaced his indecisive predecessor last month.

But ratings slipped again after Kan floated the long taboo topic of raising sales tax to curb a public debt, already close to twice the size of the nearly $5 trillion economy. He also struggled to persuade voters he had a clear plan to fix Japan’s economy.

Kan has since stressed he would not hike the sales tax “one yen” without seeking a mandate in the next lower house poll, which must be held by late 2013, but stressed that Japan must make tough decisions to avoid a Greek-style debt crisis.

“Ten to 30 years from now, will people look back and think, the prime minister said something catchy but things went wrong, or … the prime minister said what was bitter and harsh, but that was the start of rebuilding our economy and social security system?” Kan said on Saturday as he wound up his campaign.

“I am determined to do something that will not go down in history with shame.”

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See graphics:

PM support falls over sales tax: r.reuters.com/myv63g

DPJ lead narrows over rival: link.reuters.com/jev83j

Japan's massive public debt: r.reuters.com/sez92m

Upper house seats before poll: link.reuters.com/tuv85m

More stories on the Japanese politics: [ID:nPOLJP] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

MISSING THE TARGET?

The DPJ, which ousted its long-dominant rival last year with pledges to cut waste, pry control of policymaking from bureaucrats and focus spending on households to boost growth, will almost certainly run the government whatever the outcome of Sunday’s vote because it controls the powerful lower house.

But the party needs a majority in the upper chamber to avoid policy deadlock and begin taking steps to reduce a public debt that is the worst among advanced countries.

Media surveys last week showed the DPJ would likely win around 50 or even fewer of the 121 seats up for grabs in the 242-member chamber — well short of Kan’s target of keeping all 54 seats the Democrats have up for re-election.

That would deprive the DPJ and its tiny coalition partner, the pro-spending People’s New Party, of a majority in the upper house. The Democrats would be forced to seek new allies, complicating the government’s ability to forge ahead with the fiscal reform that Kan has put at the heart of his campaign.

It would also leave Kan vulnerable to a challenge from party powerbroker Ichiro Ozawa — a critic of his sales tax proposal — ahead of a September party leadership vote. Few, though, would expect Kan to go without a fight.

Many voters have been having trouble finding a party to their taste — although a flurry of new, small parties has broadened their options — with surveys showing a hefty chunk were undecided, making precise predictions difficult.

The DPJ’s current coalition partner opposes raising the 5 percent sales tax any time soon, as do some potential allies.

Other opposition parties agree a hike is inevitable but would probably be reluctant to help out the rival DPJ. [ID:nTOE661014]

The leaders of two potential partners, the small, pro-reform Your Party and New Komeito, which partnered with the Liberal Democratic Party until its defeat last year, have rejected the idea of an alliance with the DPJ.

Analysts say they might change their tune later, but would drive hard bargains if the Democrats fare badly. (Editing by Ralph Boulton)

Afghanistan sees Pakistan border trade deal in weeks

(Reuters) – Afghanistan expects to sign a trade agreement with Pakistan this month in a move which could boost stability, but only if its neighbor drops opposition to forward-traffic with India, business leaders said on Saturday.

A long deadlock over Afghan demands for transit of exports to India via Pakistan through the sensitive Wagah land route was close to ending, clearing the way for Afghanistan-Pakistan Transit Trade Agreement (APTTA) within weeks, Afghanistan Chamber of Commerce director Abdul Qadir Bahman told Reuters.

“It is not yet certain, but we have very strong hopes differences have been overcome,” Bahman said.

Landlocked Afghanistan is dependent upon transit countries for its foreign trade, with Pakistan having the nearest seaport. More exports would help President Hamid Karzai counter a Taliban insurgency by improving economic conditions.

Almost 50 per cent of Afghanistan’s trade is with its five neighbors Pakistan, Iran, Tajikistan, Turkmenistan and Uzbekistan. Trade between Afghanistan and Pakistan is worth more than $1 billion.

But trade is very one-sided, the World Bank says, consisting for the most part by imports from Pakistan, as compared to very little formal Afghan exports.

Bahman said both sides would hold an eighth round of talks before an international conference in Kabul later this month in which donor countries and Karzai’s government will try to chart a path forward for the conflict-torn country.

“The main point is access to the sea for exports to India,” he said, promising a deal would also help combat the current thriving blackmarket trade between the two countries.

“If we sign this agreement, it will decrease that because we will have found a way for everyone to carry out business without any problems,” Bahman said.

Afghanistan, due to its strategic geographic position, hopes to become a regional transit hub for trade with Central Asia as well as South Asia, the Middle East and China, if the security situation in the country can be stabilized.

U.S. and NATO forces are currently preparing a major offensive against the Taliban in its southern strongholds, although the danger of the eastern border was underscored on Saturday when 11 Pakistanis were killed by insurgents as they entered Afghanistan.

Transit to Afghanistan through Pakistan is currently governed by the 1965 Afghan Transit Trade Agreement which specifies ports, routes, transport and customs transit procedures.

Both Afghanistan and Pakistan have agreed on the need for a new agreement to give Afghanistan sea access and provide Pakistan with direct routes to Central Asia.

But Pakistan says Afghanistan is refusing to agree to customs duty on Afghan cargo in Karachi and other measures to combat illegal smuggling such as compulsory licensing, bank credit guarantees and quarantine restrictions.

(Editing by David Fox)

Afghanistan sees Pakistan border trade deal in weeks

KABUL, July 10 (Reuters) – Afghanistan expects to sign a trade agreement with Pakistan this month in a move which could boost stability, but only if its neighbour drops opposition to forward-traffic with India, business leaders said on Saturday.

A long deadlock over Afghan demands for transit of exports to India via Pakistan through the sensitive Wagah land route was close to ending, clearing the way for Afghanistan-Pakistan Transit Trade Agreement (APTTA) within weeks, Afghanistan Chamber of Commerce director Abdul Qadir Bahman told Reuters.

“It is not yet certain, but we have very strong hopes differences have been overcome,” Bahman said.

Landlocked Afghanistan is dependent upon transit countries for its foreign trade, with Pakistan having the nearest seaport. More exports would help President Hamid Karzai counter a Taliban insurgency by improving economic conditions. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

For more on Afghanistan click [ID:nAFPAK]

or see link.reuters.com/syx62d

Afghan blog: blogs.reuters.com/afghanistan/ ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> Almost 50 per cent of Afghanistan’s trade is with its five neighbours Pakistan, Iran, Tajikistan, Turkmenistan and Uzbekistan. Trade between Afghanistan and Pakistan is worth more than $1 billion.

But trade is very one-sided, the World Bank says, consisting for the most part by imports from Pakistan, as compared to very little formal Afghan exports.

Bahman said both sides would hold an eighth round of talks before an international conference in Kabul later this month in which donor countries and Karzai’s government will try to chart a path forward for the conflict-torn country.

“The main point is access to the sea for exports to India,” he said, promising a deal would also help combat the current thriving blackmarket trade between the two countries.

“If we sign this agreement, it will decrease that because we will have found a way for everyone to carry out business without any problems,” Bahman said.

Afghanistan, due to its strategic geographic position, hopes to become a regional transit hub for trade with Central Asia as well as South Asia, the Middle East and China, if the security situation in the country can be stabilised.

U.S. and NATO forces are currently preparing a major offensive against the Taliban in its southern strongholds, although the danger of the eastern border was underscored on Saturday when 11 Pakistanis were killed by insurgents as they entered Afghanistan. [ID:nSGE669GBL]

Transit to Afghanistan through Pakistan is currently governed by the 1965 Afghan Transit Trade Agreement which specifies ports, routes, transport and customs transit procedures.

Both Afghanistan and Pakistan have agreed on the need for a new agreement to give Afghanistan sea access and provide Pakistan with direct routes to Central Asia.

But Pakistan says Afghanistan is refusing to agree to customs duty on Afghan cargo in Karachi and other measures to combat illegal smuggling such as compulsory licencing, bank credit guarantees and quarantine restrictions. (Editing by David Fox) (For more Reuters coverage of Afghanistan and Pakistan, see: here)

WRAPUP 2-Japan PM makes pitch as party struggles before poll

TOKYO, July 10 (Reuters) – Japanese Prime Minister Naoto Kan urged voters to give his party a second chance in a weekend election that could deliver a sharp setback to his government, putting his job at risk and stalling efforts at fiscal reform.

Sagging support for the Democratic Party of Japan (DPJ), which surged to power for the first time just last year, jumped after Kan — a former civic activist and Japan’s fifth leader in three years — replaced his indecisive predecessor last month.

But ratings slipped after Kan floated the long taboo topic of raising the sales tax to curb a public debt close to twice the size of the nearly $5 trillion economy, and struggled to persuade voters he had a clear plan for fixing Japan’s economic woes.

Since then, Kan has stressed that no tax hike would occur before seeking a mandate in the next lower house poll, which must be held by late 2013, but argued that Japan could not put off painful choices if it wants to avoid a Greek-style debt crisis.

“Japan’s economy is 20 to 30 times bigger than that of Greece and its public debt is huge, so no country in the world could rescue Japan,” Kan told a crowd of voters sweltering on Saturday under the hot sun in a popular shopping area of western Tokyo.

“Japan itself must make sure it avoids collapse,” he said, adding ordinary folk would suffer most if finances crumbled. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

See graphics:

PM support falls over sales tax: r.reuters.com/myv63g

DPJ lead narrows over rival: link.reuters.com/jev83j

Japan's massive public debt: r.reuters.com/sez92m

Upper house seats before poll: link.reuters.com/tuv85m

More stories on the Japanese politics: [ID:nPOLJP] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

The DPJ, which ousted its long-dominant rival last year with pledges to cut waste, end bureaucrats’ control over policymaking and spend more on consumers to boost growth, will almost certainly run the government whatever the outcome of Sunday’s vote because it controls the powerful lower house.

But the party needs a majority in the upper chamber to avoid policy deadlock and begin taking steps to reduce a public debt that is the worst among advanced countries.

NEEDING ALLIES, FACING CHALLENGE

Media surveys this week showed the DPJ would likely win around 50 or even fewer of the 121 seats up for grabs in the 242-member chamber — well short of Kan’s target of keeping all 54 seats the Democrats have up for re-election.

That would deprive the DPJ and its tiny coalition partner, the pro-spending People’s New Party, of a majority in the upper house. The Democrats would be forced to seek new allies, complicating the government’s ability to forge ahead with the fiscal reform that Kan has put at the heart of his campaign.

It would also leave Kan vulnerable to a challenge from party powerbroker Ichiro Ozawa — a critic of his sales tax proposal — ahead of a September party leadership vote, although few expect Kan to go without a fight.

Not all voters have been put off by the sales tax talk, and indeed, surveys have shown many think a rise is inevitable.

“I agree with a sales tax rise and I think the sooner, the better,” said Akiko Takita, a 63-year-old retired Tokyo resident who voted for the DPJ last year and plans to do so again.

“There should be less discussion and more action.”

But many others are having trouble finding a party to their taste, with surveys showing a hefty chunk are undecided.

“I’ve looked at them all but there is no one I like,” said event planner Osamu Sato, 32. “I’ll just decide on the day.”

The DPJ’s current coalition partner opposes raising the 5 percent sales tax any time soon, as do some potential allies. Other opposition parties agree a hike is inevitable but would probably be reluctant to help out the rival DPJ, which has not yet mapped out any detailed tax reform proposals. [ID:nTOE661014]

The 63-year-old Kan has called for non-partisan talks on tax reform and said any rise in the 5 percent sales tax would take at least two to three years to implement.

He is also touting a “Third Way” economic strategy that would use tax revenues to target growth areas such as healthcare and the environment, although many economist are dubious.

The leaders of two potential partners, the pro-reform Your Party and New Komeito, which partnered with the Liberal Democratic Party until its ouster last year, have rejected the idea of an alliance with the DPJ.

Analysts say they might change their tune later, but would drive hard bargains if the Democrats fare badly. (Additional reporting by Rika Otsuka; Writing by Linda Sieg)

SCENARIOS-Japan DPJ may stumble in vote, fiscal reform at risk

July 9 (Reuters) – Japan’s ruling Democratic Party could fall far short of Prime Minister Naoto Kan’s target in Sunday’s upper house election, a result that could put his job at risk and hamper efforts to curb huge public debt.

The Democratic Party of Japan (DPJ) will almost certainly stay in power whatever the outcome of the vote because of its huge majority in parliament’s lower house, but it needs an upper house majority to pass bills and avoid policy deadlock.

Below are scenarios for the election outcome and policy implications. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

See graphics:

PM support falls over sales tax: r.reuters.com/myv63g

DPJ lead narrows over rival: link.reuters.com/jev83j

Japan's massive public debt: r.reuters.com/sez92m

Upper house seats before poll: link.reuters.com/tuv85m

More stories on the Japanese politics [ID:nPOLJP] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

DEMOCRATS WIN OUTRIGHT MAJORITY (HIGHLY UNLIKELY)

The resignations of Kan’s unpopular predecessor Yukio Hatoyama and powerbroker Ichiro Ozawa as party No. 2 last month lifted support for the government, but voter ratings have slid to under 50 percent since Kan proposed a sales tax rise.

To win an outright majority in the 242-member chamber, the Democrats need to win 60 of the 121 seats up for grabs, but no media surveys showed the DPJ winning that many seats.

If the Democrats win a majority, they would no longer have to rely on the tiny, pro-spending People’s New Party (PNP), their coalition ally, to pass bills in the upper house.

The Democrats themselves, however, remain a party of diverse policies, from pro-market reformers to proponents of big government, so effective decision-making needs strong leadership.

DPJ HITS PM’S TARGET (UNLIKELY)

If the Democrats hit Kan’s own target of 54, he can claim success and probably fend off any challenge from party rivals in a leadership vote set for September, and avoid becoming the latest of revolving-door premiers. This is partly because finding extra lawmakers to make up a majority might not be that hard.

The DPJ and the PNP need to win 56 seats to keep a bare majority. But if, as now seems likely, they fall short of that, the DPJ would need to find new allies. This would most likely be done on a policy-by-policy basis rather than by giving away cabinet posts in a formal coalition.

Several potential partners have said they have no plans to help out. While some analysts predict they will change their tune after the vote, political manoeuvring would absorb energy after the election, delaying key policy decisions.

Possible allies include the small pro-reform Your Party, set up by defectors from the then-ruling Liberal Democratic Party (LDP) before last year’s lower house poll, and the New Komeito, a Buddhist-backed party that partnered with the LDP until last year’s election defeat.

The New Komeito stresses tax reform to bolster social welfare policies, while the Your Party insists more waste must be cut before raising taxes. Some lawmakers might bolt from the main opposition, the LDP, which has also proposed a sales tax rise.

A tie-up with the Your Party would push the government towards more market-friendly policies.

But juggling divergent policy priorities among allies would complicate decisions, as was the case during the Democrats’ first eight months in power, when they had to deal with the PNP and a small leftist party, the Social Democrats, who left the coalition in a feud over a U.S. base in southern Japan.

DEMOCRATS WIN 50-53 SEATS (POSSIBLE)

Kan might still be able to fend off a challenge, but his ability to forge ahead with policies would be seriously weakened.

Party powerbroker Ichiro Ozawa, who has criticised the prime minister’s shift towards fiscal reform, would be more likely to back a rival in the September party leadership vote.

The worse the Democrats’ performance, the harder the bargains that small opposition parties such as the Your Party would drive to cooperate, making policy stalemate more likely.

Your Party leader Yoshimi Watanabe would probably be more inclined to stay in opposition in hopes of sparking a political realignment, possibly but not necessarily along policy lines.

Ozawa might bolt the Democratic Party if his challenge to Kan fails, splitting the party — although it is unclear how many lawmakers would follow.

DEMOCRATS WIN FEWER THAN 50 SEATS (POSSIBLE)

Ozawa and his allies would pressure Kan to resign and seek to move forward the party leadership vote.

Few analysts see the fiery former civic activist bowing out of his own accord, and some say Kan might even threaten to call a general election, gambling that Ozawa’s supporters in the lower house — many of whom are rookie lawmakers — would be the ones to lose seats while a slimmed-down DPJ kept a majority.

With smaller parties wary of tie-ups, Kan might invite the rival LDP, which agrees on the need for a future sales tax rise, into a “grand coalition”.

But if that proves fruitless, he might call a lower house election to seek a new mandate, some analysts said.

Political manoeuvering would absorb the government’s energy and difficult policy decisions would be in abeyance. (Editing by Ron Popeski)

Exclusive: China rebuffs U.S. trade criticism

(Reuters) – China has dismissed U.S. comments that Beijing is blocking a new trade agreement, saying that it was the United States that was stalling progress in the World Trade Organization’s long-running Doha round.

Politics | China | Brazil

The angry comments, by China’s ambassador to the WTO, indicate how difficult it now is to bridge the gaps in the Doha talks, launched in late 2001, because of differences between the United States and big emerging economies, foremost China.

“Everybody knows what the real reason for the deadlock of the Doha round is and where the main political obstacles come from,” Sun Zhenyu told Reuters on Sunday.

“The U.S. is the sole member who insists that we’re still far away from the conclusion of the round. Their new excessive request on an elevated level of ambition is in fact equivalent to a restart of the round and a flagrant deviation from the original negotiation mandates.”

WAR OF WORDS

Frustration on both sides has now boiled over into a public war of words, making a deal even harder, a fact recognized by leaders of the G8 countries, who include the United States but not China, when at their summit in Canada on Saturday they dropped a commitment to complete Doha this year and simply renewed a pledge to conclude an agreement.

Sun was responding to comments by his American counterpart, Michael Punke, the U.S. ambassador to the WTO.

Punke told Reuters in an interview on June 24 that the talks were stuck because of a refusal by China and other big emerging economies such as Brazil and India to open their markets.

The United States says that the big emerging countries have benefited from the global trading system and will also be the sources of much future growth. They therefore have a duty to open their markets to create new business opportunities not just for rich nations but also for other developing countries.

It says that China, now the world’s biggest exporter, has clearly gained enormously from joining the WTO in 2001, when it made big cuts in tariffs and opened its markets.

But Punke said China had not responded to U.S. requests for detailed one-on-one negotiations, although there were signs of hope that Brazil and India would take part in talks.

He said the United States recognized that serious negotiations involved give and take, indicating that Washington was ready to pay for new concessions from its partners.

But Sun said that the United States was trying to reopen what had been agreed over the past eight years by making new demands on developing countries to open their markets without saying what it would give in return.

“The blame put on China, Brazil and India is nothing but a red herring to distract people’s attention from the real problem,” he said.

If the United States really wanted to make progress in the talks, it could address a number of contentious issues, he said.

It could cut its trade-distorting agricultural subsidies, especially cotton, from $15 billion, cut “tariff peaks” on sensitive goods that keep out developing country imports, comply with WTO rulings condemning its controversial method of calculating anti-dumping duties, known as zeroing, and let in more temporary workers for services from health to construction.

Sun said China was negotiating actively in the Doha talks and under current proposals would cut its agricultural and industrial tariffs by about 30 percent, as well as opening several new service sectors to foreign competition.

China had repeatedly called at the G20 for a Doha deal to help the world recovery, but a deal had to benefit developing countries, not the interest of one rich WTO member, he said.

(Editing by Charles Dick)

EXCLUSIVE-China rebuffs US trade criticism, says US to blame

GENEVA, June 27 (Reuters) – China has dismissed U.S. comments that Beijing is blocking a new trade agreement, saying that it was the United States that was stalling progress in the World Trade Organization’s long-running Doha round.

The angry comments, by China’s ambassador to the WTO, indicate how difficult it now is to bridge the gaps in the Doha talks, launched in late 2001, because of differences between the United States and big emerging economies, foremost China.

“Everybody knows what the real reason for the deadlock of the Doha round is and where the main political obstacles come from,” Sun Zhenyu told Reuters on Sunday.

“The U.S. is the sole member who insists that we’re still far away from the conclusion of the round. Their new excessive request on an elevated level of ambition is in fact equivalent to a restart of the round and a flagrant deviation from the original negotiation mandates.”

WAR OF WORDS

Frustration on both sides has now boiled over into a public war of words, making a deal even harder, a fact recognised by leaders of the G8 countries, who include the United States but not China, when at their summit in Canada on Saturday they dropped a commitment to complete Doha this year and simply renewed a pledge to conclude an agreement. [ID:nN26222409]

Sun was responding to comments by his American counterpart, Michael Punke, the U.S. ambassador to the WTO.

Punke told Reuters in an interview on June 24 that the talks were stuck because of a refusal by China and other big emerging economies such as Brazil and India to open their markets. [ID:nLDE65N1HG]

The United States says that the big emerging countries have benefited from the global trading system and will also be the sources of much future growth. They therefore have a duty to open their markets to create new business opportunities not just for rich nations but also for other developing countries.

It says that China, now the world’s biggest exporter, has clearly gained enormously from joining the WTO in 2001, when it made big cuts in tariffs and opened its markets.

But Punke said China had not responded to U.S. requests for detailed one-on-one negotiations, although there were signs of hope that Brazil and India would take part in talks.

He said the United States recognised that serious negotiations involved give and take, indicating that Washington was ready to pay for new concessions from its partners.

But Sun said that the United States was trying to reopen what had been agreed over the past eight years by making new demands on developing countries to open their markets without saying what it would give in return.

“The blame put on China, Brazil and India is nothing but a red herring to distract people’s attention from the real problem,” he said.

If the United States really wanted to make progress in the talks, it could address a number of contentious issues, he said.

It could cut its trade-distorting agricultural subsidies, especially cotton, from $15 billion, cut “tariff peaks” on sensitive goods that keep out developing country imports, comply with WTO rulings condemning its controversial method of calculating anti-dumping duties, known as zeroing, and let in more temporary workers for services from health to construction.

Sun said China was negotiating actively in the Doha talks and under current proposals would cut its agricultural and industrial tariffs by about 30 percent, as well as opening several new service sectors to foreign competition.

China had repeatedly called at the G20 for a Doha deal to help the world recovery, but a deal had to benefit developing countries, not the interest of one rich WTO member, he said. (Editing by Charles Dick)

Japan PM sticks to modest election goal after polls

(Reuters) – Japan’s prime minister tried to quell suggestions on Saturday he could be the next in line of revolving door leaders, sticking to a modest target in a forthcoming election after polls showed his party may miss a majority.

World | Japan

Speculation simmers that rivals in Naoto Kan’s ruling Democratic Party of Japan (DPJ) could try to oust him if the party fares poorly in the July 11 upper house election. The party needs a majority in the chamber to forge ahead with policies to boost the economy and cut huge debt.

The DPJ, which swept to power for the first time last year, will run the government regardless of the outcome given its dominance in the lower house, but control of the upper house would enable it to avoid policy deadlock.

Kan, who took over this month as Japan’s fifth premier in three years, said he was standing by a goal to win 54 of 121 seats in the election. That would fall short of a majority but analysts say Kan is setting the bar low to avoid being ousted in a party leadership vote in September.

“Before I became the party leader, the DPJ was in a tough position,” he told reporters in Toronto, where he was making his debut at a meeting of G8 and G20 leaders.

“I want to focus on winning the current number of seats we have, then how we can exceed that.”

SHORT OF A MAJORITY

Media have reported that the DPJ could well fall short of an outright majority and may need to find new allies to control the chamber, clouding the outlook for policies.

A June 24-25 survey by the Asahi newspaper showed the DPJ could win about 54 of the 121 seats up for grabs in the 242-member upper house, in line with Kan’s target but short of the 60 it needs for an outright majority.

Support for the DPJ-led government has rebounded since Kan took over from the unpopular Yukio Hatoyama. But ratings slipped after Kan made fiscal reform the heart of his campaign and floated the idea of doubling the 5 percent sales tax.

While many voters agree an increase in the sales tax is inevitable to pay growing social security costs and fix tattered public finances, others say the government should first do more to cut wasteful spending.

Kan said priorities would be established for spending cuts and pledged to drum up support for bold tax reforms from DPJ members, some of whom are wary that the idea could hurt the party’s election chances.

“Of course we will consider ways to not put too much burden on people with low incomes,” Kan said. “My proposal is to initiate debate, so I think I can win (the party’s) understanding.”

(Editing by Ron Popeski)

CORRECTED-Japan PM sticks to modest election goal after polls

TORONTO, June 26 (Reuters) – Japan’s prime minister tried to quell suggestions on Saturday he could be the next in line of revolving door leaders, sticking to a modest target in a forthcoming election after polls showed his party may miss a majority.

Speculation simmers that rivals in Naoto Kan’s ruling Democratic Party of Japan (DPJ) could try to oust him if the party fares poorly in the July 11 upper house election. The party needs a majority in the chamber to forge ahead with policies to boost the economy and cut huge debt.

The DPJ, which swept to power for the first time last year, will run the government regardless of the outcome given its dominance in the lower house, but control of the upper house would enable it to avoid policy deadlock.

Kan, who took over this month as Japan’s fifth premier in three years, said he was standing by a goal to win 54 of 121 seats in the election. That would fall short of a majority but analysts say Kan is setting the bar low to avoid being ousted in a party leadership vote in September.

“Before I became the party leader, the DPJ was in a tough position,” he told reporters in Toronto, where he was making his debut at a meeting of G8 and G20 leaders.

“I want to focus on winning the current number of seats we have, then how we can exceed that.”

SHORT OF A MAJORITY

Media have reported that the DPJ could well fall short of an outright majority and may need to find new allies to control the chamber, clouding the outlook for policies.

A June 24-25 survey by the Asahi newspaper showed the DPJ could win about 54 of the 121 seats up for grabs in the 242-member upper house, in line with Kan’s target but short of the 60 it needs for an outright majority. [ID:nTOE65P006]

Support for the DPJ-led government has rebounded since Kan took over from the unpopular Yukio Hatoyama. But ratings slipped after Kan made fiscal reform the heart of his campaign and floated the idea of doubling the 5 percent sales tax.

While many voters agree an increase in the sales tax is inevitable to pay growing social security costs and fix tattered public finances, others say the government should first do more to cut wasteful spending.

Kan said priorities would be established for spending cuts and pledged to drum up support for bold tax reforms from DPJ members, some of whom are wary that the idea could hurt the party’s election chances.

“Of course we will consider ways to not put too much burden on people with low incomes,” Kan said. “My proposal is to initiate debate, so I think I can win (the party’s) understanding.” (Editing by Ron Popeski)

Okinawans angry over U.S. base plan, PM at risk

Japanese Prime Minister Yukio Hatoyama on Sunday abandoned a pledge to move a U.S. air base off Okinawa, fanning local anger, upsetting a coalition partner and risking another blow to his ratings ahead of a mid-year election.

Hatoyama said he had concluded the base should be shifted to the Henoko area of the northern Okinawa city of Nago — largely in line with a 2006 U.S-Japan agreement. But the governor of Okinawa quickly said it would be tough to accept such a plan.

Voter perception that Hatoyama has mishandled the Futenma air base row has eroded government support, threatening the ruling Democratic Party’s chances in the upper house election, which it must win to avoid policy deadlock.

Hatoyama has set himself an end-May deadline to resolve the problem, which has frayed ties with Tokyo’s key security ally Washington just as the two countries confront security challenges such as an unpredictable North Korea and a rising China.

“Concerns and anger that people in Okinawa have are understandable,” Hatoyama told Okinawa Governor Hirokazu Nakaima in a meeting at the Okinawa prefecture office, as a crowd of protesters stood outside carrying signs opposing the plan and shouting “Go home”.

“But as shown in recent developments in the Korean peninsula, uncertainty remains over security in East Asia and we cannot let the deterrence of U.S. military forces in Japan decline.

“It is a heart-rending decision for me,” Hatoyama added and apologised to the people of Okinawa, for failing to succeed in shifting the base off the island.

In a brief visit to Japan on Friday, U.S. Secretary of State Hillary Clinton said Pyongyang’s sinking of a South Korean ship had underscored the importance of the alliance.

But the governor of Okinawa, host to about half the U.S. forces in Japan, expressed disappointment.

“The idea of moving the base to Henoko is quite regrettable and (accepting it) is extremely tough,” Nakaima told Hatoyama in the meeting, aired live on nationwide TV.

LOCAL ANGER

In the campaign that swept his party to power last year, Hatoyama had raised hopes the U.S. Marine base could be moved off Okinawa, but Washington has sought to stick to the 2006 deal to move the facility to Nago.

Hatoyama later shifted gears, saying some Marines had to stay to deter threats, a move that outraged many Okinawans and upset a small ruling party, the Social Democrats.

“It is the worst possible case. He has made enemies of the governor of Okinawa, the Democrats in Okinawa, his coalition partner and the opposition, and put ties with America first,” said independent political analyst Hirotaka Futatsuki.

“But once he promises this to the United States, even if Okinawa objects, ultimately, they will have to move it to Henoko.”

In a separate meeting, Nago City Mayor Susumu Inamine, elected in January on an anti-base platform, told Hatoyama that the plan was “absolutely unacceptable”.

“I cannot help feeling angry as this betrays feelings of people in Nago and Okinawa, who have called for the base to be moved out of the prefecture,” Inamine told Hatoyama.

Mizuho Fukushima, head of the Social Democratic Party, told reporters she opposed Hatoyama’s plan. But she also said no decision has been made on whether her party would leave the coalition government over the issue, Kyodo news agency reported.

The tiny Social Democratic Party’s votes are no longer needed to pass bills smoothly in parliament, but a rift in the coalition ahead of the upper house election would be ill-timed.

Japanese media said a formal agreement with the United States on the plan would be announced on Friday, when Hatoyama is expected to give a news conference. Japanese Defence Minister Toshimi Kitazawa said he would visit Washington on Monday to further discuss the plan with his counterpart, Robert Gates.

Details of the new deal with Washington, including the exact location of a new runway and the construction method, are to be worked out before U.S. President Barack Obama visits Japan in November for an Asia-Pacific leaders summit, Japanese media said.

Hatoyama said the government would continue to negotiate with the United States to lessen the burden on Okinawa, where residents have long resented bearing what they feel is an unfair burden for maintaining the security alliance.

“I don’t consider this as the end.”

(Additional reporting by Linda Sieg; Editing by Jeremy Laurence)

Thai Govt mulls imposing curfew after death toll from clashes touches 24

Bangkok, May 16 (ANI): The Thai Government is now mulling the imposition of a curfew after heightened tensions between security forces and Red Shirt protestors, who showed no signs of backing down.

The clashes between the two have already claimed 24 lives and left 198 injured, 14 of whom are in critical condition. Over 50 people have been killed and over 1600 wounded ever since protests began 2 months ago.

“The best way for preventing losses is ending the rally as the protest is a condition that leads to violence, particularly when protesters equipped with war weapons,” the Bangkok Post quoted Prime Minister Abhisit Vejjajiva as saying.

Vejajjiva has also deferred the re-opening of schools, originally scheduled for Monday to May 24th for safety reasons.

He has firmly maintained that there will be no recall on the issue of live-fire, and that though he regretted the loss of lives in the process, containment measures will continue.

“It”s crucial that we don”t turn back and allow those who violate the law, and establish armed militants, to intimidate the government,” he said.

The Red Shirts have been putting up fierce resistance, lobbing fireworks at security forces. They believe that the Vejajjiva administration is undemocratic and elitist and want their hero, former Prime Minister Thaksin Shinawatra to be reinstated.

Most of the protestors hail form poorer parts of Thailand, mainly north and north-east Thailand. Their fury and disillusionment reflects the abyss between the urban elite and the rural poor.

The climate of the popular tourist destination is extremely charged, with Red-Shirt protesters comparing their agitation to a civil war, and are uncertain as to how the deadlock would end.

“The current situation is almost full civil war,” said one of the protest leaders, Jatuporn Prompan. “I”m not sure how this conflict will end.”

The clashes have paralysed the normal lives of Bangkok residents with all commuter train services being suspended, and schools being shut. The hospitality industry of the once thriving tourist destination has also taken a severe beating. (ANI)

Nepal PM won”t resign unless army integration issue is settled

Kathmandu, May 10 (ANI): Prime Minister Madhav Kumar Nepal”s political advisor Raghuji Panta has said Nepal will not step down until there is an agreement on the integration of Maoist combatants with the Nepal Army.

According to Nepalnews, Panta said there should be an agreement on the number of Maoist combatants before the Prime Minister could consider resigning.

“The Prime Minister has no compulsion to resign just because of the Unified CPN (Maoist) agitation.

Panta”s views come at a time when Nepal is facing increasing pressure from the Maoists, a section of his own party, CPN (UML) and the business community to resign to end the current political standoff.

American and European Union diplomats have also expressed dissatisfaction over government”s refusal to break the deadlock.

Meanwhile, the Unified CPN (Maoist) has declined a request made by Nepal to come for talks.

A Maoist Standing Committee meeting concluded that the government seems unwilling for a political consensus. (ANI)

Celtics take clutch win for 3-0 series lead

The Boston Celtics put the Miami Heat on the brink of elimination from the playoffs, with a clutch 100-98 victory on Friday to take a 3-0 lead in their Eastern Conference first round series.

Paul Pierce’s 21-foot jumper at the buzzer wrapped up the win after Miami had fought back from a nine-point fourth-quarter deficit.

“The whole play was for Paul,” Celtics coach Doc Rivers told reporters.

“We told him last shot. … He’s a star. He never loses his confidence.”

Boston can close out the best-of-seven series with a win in Game Four in Miami Sunday.

No NBA team has ever come back to win a series after losing the first three games.

“The door isn’t closed. We have another day,” said Heat coach Erik Spoelstra.

Pierce scored 32 points, including the last five for Boston, as he duelled the Heat’s Dwyane Wade, who scored 34 points before a left calf injury forced him off with 11 seconds to play.

Pierce’s three-pointer broke a 95-95 deadlock with 1:42 to play, but the Heat quickly tied the score on Dorell Wright’s three-pointer 13 seconds later.

Boston then missed three three-pointers, two by Ray Allen, and Wade misfired on a three-pointer for Miami before Pierce scored the game-winner.

“We certainly fought the fight in terms of bringing the appropriate level of intensity to the game,” Miami’s Spoelstra said.

“It is obviously a very tough loss, losing like that on a last-second shot. You have the feeling like it could take your spirit. But it’s about staying in this fight.”

(Reporting by Gene Cherry in Raleigh, North Carolina; Editing by Patrick Johnston; To query or comment on this story email sportsfeedback@thomsonreuters.com)

Public servants formally reject pay offer

Unions representing ACT public servants are still heading for a showdown with the Territory Government over pay.

More than 350 public servants from 10 different unions have formally voted to reject the Government’s pay offer.

The Government is offering a 4.75 per cent rise over two years saying it has to restrain pay because of the tough economic climate.

Unions ACT secretary Kim Sattler says the offer is poor and unreasonable.

“[Members] also voted unanimously to seek protected industrial action ballots and to seek a hearing with Fair Work Australia to break the deadlock,” she said.

“Members felt very strongly that the pay offer was poor and the other conditions attached to the offer which involved removing certain entitlements from the agreement were most unreasonable.”

Health reform talks drag on

The deadlock over the federal hospital takeover continues, with Victoria and Western Australia still refusing to back the Commonwealth’s plan.

Negotiations at the Council of Australian Governments (COAG) meeting are dragging well into their second day as disagreement remains over a key element of the Commonwealth’s proposal to become the dominant funder of hospitals.

Prime Minister Kevin Rudd wants to take back a third of state GST revenue to directly fund 60 per cent of hospital costs.

Earlier today NSW Wales Premier Kristina Keneally agreed to hand over her GST share in return for further concessions from the Federal Government.

But Western Australian Premier Colin Barnett and his Victorian counterpart John Brumby will not do the same.

Instead they have pledged to allocate 30 per cent of GST funds into a pooled fund of federal and state money.

As the meeting broke for lunch, Mr Barnett said talks were going “slowly” and the GST issue had not been discussed.

When asked by reporters if he was under pressure to follow the lead of NSW, he replied, “Do I look like I’m under pressure?”.

Mr Rudd said he was talking things “one step at a time”.

“It’s going to be a challenge to get through the continued areas of disagreement,” he said.

Ms Keneally used her lunch break to post a YouTube video giving her assessment of the state of play.

“There’s no agreement unless all states sign up so later today we’re working towards that,” she said.

After meeting with Mr Rudd this morning Ms Keneally agreed to sign NSW up to the plan after securing assurances the funds would only be used for health and would be put in a state pool.

Sources say she also secured $686 million to cover transitional costs.

Mr Rudd has also put a further $4 billion on the table if the states agree to the plan.

Health impasse implications ‘critical’

The Mayor of the Kangaroo Island Council, Jayne Bates, says the deadlock between Country Health SA and the island’s doctors needs to be resolved quickly.

The island’s doctors say new on-call contracts provided by Country Health are unacceptable.

They say they are unhappy about the possibility of being prevented from providing specialist on-call services like obstetrics and anaesthetics.

Country Health says it is still negotiating with the doctors.

But councillor Bates says if the contracts are not agreed to soon, Kangaroo Island will suffer.

“It’s not a storm in a teacup and I think the implications for the island and the potential loss of services is critical,” she said.

“We can’t drive to another hospital, we are remote, we are an island and the need to maintain the services we’ve got is critical.”

WA holding out over federal plan

The West Australian Premier Colin Barnett says he is still prepared to compromise in an effort to break the deadlock over the Federal Government’s health package.

He made the offer as he entered the second day of talks with the Prime Minister Kevin Rudd in Canberra.

On the second day of negotiations at the Council of Australian Governments’ COAG meeting in Canberra, Mr Barnett says he has put forward a compromise.

“Western Australia will not agree to handing over one third of the GST.

“We are prepared to hand over exactly the same amount but it will be paid in by Western Australia, not seized by the Commonwealth.”

Mr Barnett says his government is prepared to put $1.5 billion into the health fund.

Victoria and New South Wales had both earlier refused to give up a portion of GST but their Premiers subsequently reached a deal.

Mr Barnett says an agreement is within Kevin Rudd’s grasp but that today’s talks are going slowly.

Mr Rudd says he will press ahead to get a deal.

“We’ve got quite a bit more work to do and and I and the others are working very hard and there is still areas of continued disagreement but we intend to give this our best shot.”

WA Nationals President Colin Holt has urged the Premier to approach the health negotiations cautiously.

“I mean we’re a long way from Canberra and it’s difficult enough now to get funds coming from Canberra to WA.