Nato fails to mend internal rift over Iraq war

Nato failed yesterday to repair one of the biggest rifts in its 54-year history, with France, Germany and Belgium giving no sign of backing alliance preparations for a possible US-led war against Iraq.

In Brussels, a Nato official said after two days of deadlock that efforts to break the impasse in the alliance would continue through the night, with a meeting of its North Atlantic Council set for 0845 GMT today.

Serious differences over Iraq were laid bare on Monday as the three European nations held up military deployments for Nato member Turkey intended to protect it from Iraqi retaliation if US troops attack Iraq from Turkish soil.

France, Germany and Belgium argued, to US annoyance, that to send Turkey surveillance planes, Patriot missiles and anti-chemical and biological warfare teams would be a premature signal that war had begun and diplomatic efforts had ended.

Explaining its stance at Nato, France insisted its solidarity with Turkey was total but said Paris had to base its approach to Iraq on UN Security Council resolution 1441.

"We cannot today, through a Nato decision, lend our support in principle to a military intervention in Iraq and thus pre-empt the decisions of the Security Council," French Foreign Ministry spokesman Francois Rivasseau told reporters.

The threat of war is spilling over into the global economy. In Washington, Federal Reserve Chairman Alan Greenspan said uncertainties over possible war posed "formidable barriers" to business spending and made it tough to gauge the health of the US economy.

Germany pushed for a European plan to confront economic weakness that is threatening to push it into another recession - which an Iraq war would exacerbate.

Oil prices rose to two-year highs yesterday after the head of the world's biggest oil company, Exxon Mobil Corp, said US strategic reserves should not be used to curb prices.

In Iraq, President Saddam Hussein was shown on television receiving officials to mark the Muslim Eid al-Adha holiday, and telling them Iraqis were ready to face any US-led attack.

"I could not wish for a greater, higher or better state that we are in... of Iraqi men and women and their growing readiness and ability to confront evil" in attacking Iraq, he said.

A personal peace envoy from Pope John Paul arrived in Baghdad with a message to Saddam "crucial for peace in Iraq" and was due to meet Iraqi officials today.

CIA Director George Tenet repeated a long-held view of the Bush administration that the al Qaeda network, which it blames for the September 11 attacks on the United States, had a presence in Iraq - a view disputed by some US allies.

He told the US Senate intelligence committee the network also had a presence in Iran and continued to find refuge in the hinterlands of Afghanistan and Pakistan.

While Nato grappled with its stance over Iraq, the European Union, which includes many Nato member states, announced that heads of state and government would gather for a summit on Iraq in Brussels next Monday.

"Now is the time for everyone to take a stand. Europe needs a common stance at this crucial period," Greek government spokesman Christos Protopapas told reporters in Athens. Greece is current EU president.

Some member states feared, however, the summit might expose the depth of disunity over Iraq within the 15-nation bloc.

Turkey made clear it believed the alliance had a duty to start military preparations to defend it after all Ankara had done to protect its front line through decades of Cold War.

"Turkey defended the whole of Europe during the Cold War period... So there is no doubt that Nato must do what falls to it," Prime Minister Abdullah Gul told reporters in Ankara.

Separately, France, Russia and Germany have jointly set out their alternative to US war plans: more arms inspections in Iraq, more diplomacy and more time.

France, which maintains there is no "undisputed proof" Iraq has weapons of mass destruction, and Russia have veto powers on the UN Security Council which could kill any new resolution authorising war. Germany is currently rotating president of the Council.

China, which also holds veto power, welcomed the Franco-German-Russian proposals.

A senior German government source said all but four of the 15 UN Security Council members supported prolonging weapons inspections in Iraq.

But a White House spokesman said Bush still hoped for a new UN resolution authorising military force against Iraq.

The Nato rift is the worst since members argued over the deployment of US cruise missiles in Europe in the 1980s.

Britain, the United States' staunchest ally, dismissed calls for more time and resources for the United Nations to disarm Iraq, saying no amount of inspectors could do the job without Baghdad's full compliance.