Japan hits back at critics at Davos

DAVOS: Japan's economy minister on Saturday hit back at critics of Tokyo's new economic policies, saying they did not call into question the independence of its central bank.

Speaking at the World Economic Forum in Davos, Akira Amari said the Bank of Japan had "voluntarily" decided with the government to introduce a new inflation target in a bid to boost the world's third-largest economy.

The new government in Tokyo, led by Prime Minister Shinzo Abe, has pushed the Bank of Japan (BOJ) to be more aggressive in its actions to battle nearly two decades of deflation and sluggish growth.

The BOJ on Tuesday unveiled a new inflation target of two per cent and a massive programme of asset purchases to pump money into the economy, sparking accusations that central bank independence had been compromised.

No less an authority than German Chancellor Angela Merkel told Davos on Thursday that she was "not without concern" about Japan's actions.

"As regards the new proposal, you might say that it might undermine the independence of the BOJ. In the case of Japan so far, there has not been any undertaking to share the inflationary targets with the central bank," Amari said.

"This time for the first time, we came to an agreement of a two-per cent inflation target that is around the international level," the minister added.

The policy has also led to a steady decline in the value of the yen against other currencies -- boosting exports -- but other countries have expressed concern that Tokyo is pursuing a beggar-thy-neighbour approach.

Amari declined to comment on the current level of the yen, which has fallen steadily since the new policies were unveiled, saying that it was "for the markets to decide" the exchange rate.

The head of Organisation for Economic Cooperation and Development (OECD), Angel Gurria, told the same panel that it was a "fine line" to walk between defending your currency and putting trading partners at a disadvantage.

He noted that countries like Japan -- he also mentioned Brazil, South Korea, Mexico, Chile, China and India -- were places that attract investors during periods of uncertainty on the financial markets.

This causes the currency to rise, sometimes requiring action to bring it back to a more normal level, Gurria said.

"There is a certain legitimacy in terms of trying to defend yourself from the onslaught," the OECD chief said.

"The only question is where do you draw the line between what is genuine self-defence and then something that would be a beggar-thy-neighbour policy? This is a thin line and it's a difficult line to walk," he added.

Mark Carney, governor of the Bank of Canada, hit back at this interpretation, saying that the group of seven leading industrialised countries had agreed not to intervene to affect the level of their currencies.

"There is an understanding within the G7 that has existed for the benefit of the global economy that there is not unilateral currency intervention," he insisted.

Christine Lagarde, the head of the International Monetary Fund, was more circumspect, saying the IMF was "very interested by those policies".

However, she added: "We certainly would like them to be complemented by a medium-term plan that includes how that debt will be reduced going forward."

- AFP/jc

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Headley wouldn't have got a plea bargain in India: Experts

MUMBAI: Had Pakistani-American terror plotter David Coleman Headley been tried in India, he would not have been able to enter into a plea bargain, say legal experts. Plea bargaining is not allowed in India for serious offences that attract the death penalty.

Headley plea bargained in the US in exchange for not getting the death sentence and escaping extradition to India in connection with the 26/11 attacks. On Thursday, he was sentenced to 35 years for conspiracy in the Mumbai attacks in addition to other charges. Upto 166 people died and 304 were injured in the 26/11 attacks in Mumbai.

"Headley would not have got the benefit of a plea bargain in India as the law does not permit plea bargains for serious crimes, like terror-related ones or murder," said former Supreme Court justice V S Sirpurkar on Friday in Mumbai. Senior counsel Amit Desai also said that a plea bargain would not have applied to Headley in India.

In India, plea bargains are only applicable if the offence attracts a punishment of up to seven years. However, again, they are not applicable if the crime is against a woman or child below 14. Many 26/11 victims were women and children. A plea bargain also doesn't apply if the offence affects the socio-economic status of the country. Headley could, however, have been an approver in India for a lighter sentence.

The US is bound by its plea bargaining deals, said legal experts. The US accepts plea bargains for even grave crimes, like conspiracy to commit and plot terror. US courts have held the law to be constitutional even though there have been debates about its efficacy.

Retired Justice Sirpurkar said in India many lawyers do not have faith in plea bargaining. He added that the "certainty of punishment" may have played a part with Headley. If he knew punishment was certain in the US, he would have admitted guilt and cooperated.

Double jeopardy: There is debate over whether Headley can now be tried in India. Aside from the no-extradition deal, some lawyers said an accused cannot be put in 'double jeopardy' and tried for the same offence twice. But, Desai said Headley could be tried under different charges in India, like waging a war against the country.

Video-conferencing: Chairperson of the All India Bar Association, Adish Aggarwala, said, "India could try Headley via a video-link, as he has committed serious crimes in India and against India. But the video-link's usefulness is debatable." Desai added that without extradition, Headley would be unable to be present for sentencing, which is mandatory. He said India could however pass on evidence got through a video-link to Pakistan for its trial.

Special 26/11 public prosecutor Ujjwal Nikam said that Headley can't be extradited to India or Pakistan, but since Pakistan's 26/11 case is still on, they could make him an approver.

Sirpukar added, "The conviction justifies India's position that everything went on from Pakistani soil."

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Penalty could keep smokers out of health overhaul

WASHINGTON (AP) — Millions of smokers could be priced out of health insurance because of tobacco penalties in President Barack Obama's health care law, according to experts who are just now teasing out the potential impact of a little-noted provision in the massive legislation.

The Affordable Care Act — "Obamacare" to its detractors — allows health insurers to charge smokers buying individual policies up to 50 percent higher premiums starting next Jan. 1.

For a 55-year-old smoker, the penalty could reach nearly $4,250 a year. A 60-year-old could wind up paying nearly $5,100 on top of premiums.

Younger smokers could be charged lower penalties under rules proposed last fall by the Obama administration. But older smokers could face a heavy hit on their household budgets at a time in life when smoking-related illnesses tend to emerge.

Workers covered on the job would be able to avoid tobacco penalties by joining smoking cessation programs, because employer plans operate under different rules. But experts say that option is not guaranteed to smokers trying to purchase coverage individually.

Nearly one of every five U.S. adults smokes. That share is higher among lower-income people, who also are more likely to work in jobs that don't come with health insurance and would therefore depend on the new federal health care law. Smoking increases the risk of developing heart disease, lung problems and cancer, contributing to nearly 450,000 deaths a year.

Insurers won't be allowed to charge more under the overhaul for people who are overweight, or have a health condition like a bad back or a heart that skips beats — but they can charge more if a person smokes.

Starting next Jan. 1, the federal health care law will make it possible for people who can't get coverage now to buy private policies, providing tax credits to keep the premiums affordable. Although the law prohibits insurance companies from turning away the sick, the penalties for smokers could have the same effect in many cases, keeping out potentially costly patients.

"We don't want to create barriers for people to get health care coverage," said California state Assemblyman Richard Pan, who is working on a law in his state that would limit insurers' ability to charge smokers more. The federal law allows states to limit or change the smoking penalty.

"We want people who are smoking to get smoking cessation treatment," added Pan, a pediatrician who represents the Sacramento area.

Obama administration officials declined to be interviewed for this article, but a former consumer protection regulator for the government is raising questions.

"If you are an insurer and there is a group of smokers you don't want in your pool, the ones you really don't want are the ones who have been smoking for 20 or 30 years," said Karen Pollitz, an expert on individual health insurance markets with the nonpartisan Kaiser Family Foundation. "You would have the flexibility to discourage them."

Several provisions in the federal health care law work together to leave older smokers with a bleak set of financial options, said Pollitz, formerly deputy director of the Office of Consumer Support in the federal Health and Human Services Department.

First, the law allows insurers to charge older adults up to three times as much as their youngest customers.

Second, the law allows insurers to levy the full 50 percent penalty on older smokers while charging less to younger ones.

And finally, government tax credits that will be available to help pay premiums cannot be used to offset the cost of penalties for smokers.

Here's how the math would work:

Take a hypothetical 60-year-old smoker making $35,000 a year. Estimated premiums for coverage in the new private health insurance markets under Obama's law would total $10,172. That person would be eligible for a tax credit that brings the cost down to $3,325.

But the smoking penalty could add $5,086 to the cost. And since federal tax credits can't be used to offset the penalty, the smoker's total cost for health insurance would be $8,411, or 24 percent of income. That's considered unaffordable under the federal law. The numbers were estimated using the online Kaiser Health Reform Subsidy Calculator.

"The effect of the smoking (penalty) allowed under the law would be that lower-income smokers could not afford health insurance," said Richard Curtis, president of the Institute for Health Policy Solutions, a nonpartisan research group that called attention to the issue with a study about the potential impact in California.

In today's world, insurers can simply turn down a smoker. Under Obama's overhaul, would they actually charge the full 50 percent? After all, workplace anti-smoking programs that use penalties usually charge far less, maybe $75 or $100 a month.

Robert Laszewski, a consultant who previously worked in the insurance industry, says there's a good reason to charge the maximum.

"If you don't charge the 50 percent, your competitor is going to do it, and you are going to get a disproportionate share of the less-healthy older smokers," said Laszewski. "They are going to have to play defense."

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Online:

Kaiser Health Reform Subsidy Calculator — http://healthreform.kff.org/subsidycalculator.aspx

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Mars Rover Celebrates Milestone on Red Planet

It was never supposed to last this long. When the Mars rover Opportunity settled on the Martian surface nine years ago today, mission managers at NASA said they would be pleased if it lasted for 90 days.

Instead, it's been 3,201 days, and still counting. The rover has driven 22.03 miles, mostly at a snail's pace, from one crater to another, stopping for months at a time in the frigid Martian winters. The six motorized wheels, rated to turn 2.5 million times, have lasted 70 million, and are all still working.

"Opportunity is still in very good health, especially considering what it's gone through," said John Callas, manager of NASA's Mars Exploration Rover project. The surface of Mars is a pretty tough place; there can be temperature fluctuations of a hundred degrees each day. That's pretty hard on the hardware."

Video: '7 Minutes of Terror: A Landing on Mars

When Opportunity and its twin rover, Spirit, reached Mars in January 2004, there was a fair bit of sniping that NASA, with all that 90-day talk, was playing down expectations. It escalated when Steve Squyres of Cornell University, the principal investigator for the missions, said things like, "We're on Sol 300 of a 90-Sol mission." (A Sol is a day on Mars, and lasts 24 hours, 39 minutes.) Callas and others have insisted that the prediction was based on engineering, not a nod to public relations.

"There was an expectation that airfall dust would accumulate on the rover, so that its solar panels would be able to gather less electricity," said Callas. "We saw that on Pathfinder," a small rover that landed on Mars in 1997." The cold climate was also expected to be hard on the rovers' batteries, and changes in temperature from night to day would probably pop a circuit or two.

Instead, the temperatures weren't quite as tough as engineers had expected, and the rovers proved tougher. They did become filthy as the red Martian dust settled on them, reducing the sunlight on the solar panels -- but every now and then a healthy gust came along, surprising everyone on Earth by cleaning the ships off.

Click Here for Pictures: Postcards From Mars

Spirit, in hilly territory on the other side of the planet, finally got stuck in crusty soil in 2009, and its radio went silent the next year. But Opportunity, though it's had some close calls, is -- well, you remember those commercials about the Energizer bunny.

So what do you do with an aging rover on a faraway planet? You keep using it. In its first weeks, NASA said Opportunity found chemical proof that there had once been standing water on the surface of Mars -- good news if you're looking for signs that the planet could once have been friendly to life. Since then, it's been sent to other places, with rocks and soil that are probably older, and with clay that may have been left by ancient rivers.

About 20 NASA staff members still work full-time on Opportunity at the Jet Propulsion Laboratory in Pasadena, Calif. Another 60 split their time between Opportunity and other projects, such as the Curiosity rover that landed last August. About 100 scientists, doing research on Mars, pop in and out.

In a few months, Callas said, Opportunity will head to an area nicknamed Cape Tribulation. The clay there could be rich in the minerals suggestive of past life.

They haven't done much to mark the ninth anniversary or the 3,200th Martian day, just a get-together earlier this week during a previously scheduled science conference. After that, Callas said, it was back to work.

"It's like keeping your car going," he said, "without ever having a chance to change the oil."

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Violence flares on anniversary of Egypt uprising

CAIRO/ALEXANDRIA, Egypt (Reuters) - Protesters clashed with police across Egypt on Friday on the second anniversary of the revolt that toppled Hosni Mubarak, taking to the streets against the elected Islamist president who they accuse of betraying the revolution.

At least 91 civilians and 42 security personnel were hurt in violence across the country, officials said. Street battles erupted in Cairo, Alexandria, Suez and Port Said, where the Muslim Brotherhood's political party offices were torched.

Thousands of opponents of President Mohamed Mursi and his Muslim Brotherhood allies massed in Cairo's Tahrir Square - the cradle of the uprising against Mubarak - to revive the demands of a revolution they say has been hijacked by the Islamists.

The January 25 anniversary showcased the divide between the Islamists and their secular foes that is hindering Mursi's efforts to revive an economy in crisis and reverse a plunge in Egypt's currency by enticing back investors and tourists.

Inspired by Tunisia's ground-breaking popular uprising, Egypt's revolution spurred further revolts across the Arab world. But the sense of common purpose that united Egyptians two years ago has given way to internal strife that has only worsened and last month triggered lethal street battles.

"It's definitely tense on the ground, but so far there hasn't been anything out of the ordinary or anything that really threatens to fundamentally alter the political situation," said Shadi Hamid, director of research at the Brookings Doha Center.

The Brotherhood decided against mobilizing for the anniversary, wary of the scope for more conflict after violence in December that was stoked by Mursi's decision to fast-track an Islamist-tinged constitution rejected by his opponents.

The Brotherhood fiercely denies accusations of trampling on democracy as part of a smear campaign by its rivals.

Before dawn on Friday, police battled protesters who threw petrol bombs and firecrackers as they tried to approach a wall blocking access to government buildings near Tahrir Square.

Clouds of tear gas filled the air. At one point, riot police used one of the incendiaries thrown at them to set ablaze at least two tents erected by the youths, a Reuters witness said.

Skirmishes between stone-throwing youths and the police continued in streets around the square into the day. Ambulances ferried away a steady stream of casualties.

"Our revolution is continuing. We reject the domination of any party over this state. We say no to the Brotherhood state," Hamdeen Sabahy, a popular leftist leader, told Reuters.

There were similar scenes in Suez and Alexandria, where protesters and riot police clashed near local government offices. Black smoke billowed from tyres set ablaze by youths.

Police also fired tear gas to disperse dozens of protesters who tried to scale barbed-wire barriers protecting the presidential palace in Cairo, witnesses said. Other protesters broke into offices of provincial governors in Ismailia, east of Cairo, and Kafr el-Sheikh in the Nile Delta.

In Tahrir Square, protesters echoed the chants of 2011's historic 18-day uprising. "The people want to bring down the regime," they chanted. "Leave! Leave! Leave!" chanted others as they marched towards the square.

"We are not here to celebrate but to force those in power to submit to the will of the people. Egypt now must never be like Egypt during Mubarak's rule," said Mohamed Fahmy, an activist.

BADIE CALLS FOR "PRACTICAL, SERIOUS COMPETITION"

With its eye firmly on forthcoming parliamentary elections, the Brotherhood marked the anniversary with a charity drive across the nation. It plans to deliver medical aid to one million people and distribute affordable basic foodstuffs.

Writing in Al-Ahram, Egypt's flagship state-run daily, Brotherhood leader Mohamed Badie said the country was in need of "practical, serious competition" to reform the corrupt state left by the Mubarak era.

"The differences of opinion and vision that Egypt is passing through is a characteristic at the core of transitions from dictatorship to democracy, and clearly expresses the variety of Egyptian culture," he wrote.

Still, Mursi faces discontent on multiple fronts.

His opponents say he and his group are seeking to dominate the post-Mubarak order. They accuse him of showing some of the autocratic impulses of the deposed leader by, for example, driving through the new constitution last month.

"I am taking part in today's marches to reject the warped constitution, the 'Brotherhoodisation' of the state, the attack on the rule of law, and the disregard of the president and his government for the demands for social justice," Amr Hamzawy, a prominent liberal politician, wrote on his Twitter feed.

The Brotherhood dismisses many of the criticisms as unfair fabrications of their rivals, accusing them of failing to respect the rules of the new democracy that put the Islamists in the driving seat via free elections.

Six months into office, Mursi is also being held responsible for an economic crisis caused by two years of turmoil. The Egyptian pound has sunk to record lows against the dollar.

SOURCES OF FRICTION ABOUND

Other sources of friction abound. Little has been done to reform brutal Mubarak-era security agencies. A spate of transport disasters on roads and railways neglected for years is feeding discontent as well. Activists are impatient for justice for the victims of violence over the last two years.

These include hardcore soccer fans, or ultras, who have been rallying in recent days to press for justice for 74 people killed in a soccer stadium disaster a year ago in Port Said after a match between local side al-Masry and Cairo's Al Ahly.

The parties that called for Friday's protests listed demands including a complete overhaul of the constitution.

Critics say the constitution, which was approved in a referendum, offers inadequate protection for human rights, grants the president too many privileges and fails to curb the power of a military establishment supreme in the Mubarak era.

Mursi's supporters say that enacting the constitution quickly was crucial to restoring stability desperately needed for economic recovery, and that the opposition is making the situation worse by perpetuating unrest.

(Additional reporting by Ahmed el-Shemi, Ashraf Fahim, Marwa Awad and Shaimaa Fayed in Cairo and Yousri Mohamed in Ismailia; Writing by Tom Perry; Editing by Mark Heinrich)

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Football: Thirteen cities to host Euro 2020

NYON: European football's governing body UEFA on Friday confirmed that the 2020 European Championship will be staged in 13 different cities across the continent.

UEFA's executive committee rubber-stamped the proposals, which were first made public last month, for the 2020 finals to be the first "Euro for Europe".

Previous tournaments have been held in one country or, as was the case at Euro 2012 in Poland and Ukraine, jointly-hosted by two neighbouring countries.

For 2020, UEFA have stipulated that there will be a maximum of one venue per country, and added that the two semi-finals and the final will all be held in the same stadium.

The remaining 12 winning bids will each host three group matches as well as one knockout tie from either the Round of 16 or the quarter-finals.

No nation will qualify automatically for the finals, but every host that qualifies will be guaranteed two home matches in the group phase.

No such guarantees would be given for the knockout stages.

UEFA also said they will try to take travel distances into account when allocating hosting teams to groups, "for example, and if feasible, with flights not exceeding two hours' duration between two host cities to allow easy access to travelling fans."

UEFA president Michel Platini insisted everything would be done to make a pan-European event -- to coincide with the 60th anniversary of the first European Nations Cup -- as fan-friendly as possible.

"We will play across the whole of Europe. All 53 national federations can be candidates," he said.

"A country with one stadium can host games, so supporters from that country can see the Euros.

"I think it's a very good deal for countries that would otherwise never be able to host a Euro."

Any city hoping to host the final must boast a stadium capable of holding at least 70,000 fans, but 30,000-seat venues will be considered for group matches.

Cities hoping to stage matches must put forward their bids by September this year, with the winning candidates named in September 2014.

Turkey had initially been the most likely contender to host the finals outright, but Istanbul's bid to host that summer's Olympics ruled them out.

Platini said he would still support a Turkish bid to host matches, so long as Istanbul is not chosen by the International Olympic Committee ahead of Madrid and Tokyo when the winning 2020 Games bid is announced on September 7.

"I'll vote for Turkey if they are candidates and they don't have the Olympics," he declared.

"If they have the Olympics, it is absolutely out of the question for them to host the Euros."

Platini put forward the controversial "Euro for Europe" plan in December, saying that it would be difficult for any one country to make the necessary financial commitment to stage a 24-team championship given the current economic climate.

"The situation is difficult in Europe," he said at the time. "It's hard to ask one country to invest in 10 stadiums like in Ukraine."

Platini has also insisted that the competition will return to its traditional format for 2024.

The 2016 European Championship, which will be held in France, will be the first following the decision to increase the number of competing nations from 16 to 24.

- AFP/jc

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CDC: New version of stomach bug causing US illness

NEW YORK (AP) — Health officials say a new strain of stomach bug that's sweeping the globe is taking over in the U.S.

In the last four months, more than 140 outbreaks in the U.S. have been caused by the new Sydney strain of norovirus. These kinds of contagious bugs cause bouts of diarrhea and vomiting.

The new strain may not be unusually dangerous; some scientists don't think it is. But it is different, and many people might not be able to fight off its gut-wrenching effects.

It often spreads in places like schools, cruise ships and nursing homes. The new strain was blamed for a recent outbreak on the Queen Mary 2.

The Centers for Disease Control and Prevention reported on the new strain Thursday.

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Online:

CDC report: http://www.cdc.gov/mmwr

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Exterminator Charged in Pa. Doctor's Murder

An exterminator named Joseph Smith was arrested and charged today in the strangling and burning death of Philadelphia pediatrician Melissa Ketunuti.

Smith, 36, had been sent to Ketunuti's home on a service call where the two got into "some kind of argument" in Ketunuti's basement on Monday, Capt. James Clark of the Philadelphia police department said this morning.

"At her home they got into an argument. It went terribly wrong. He struck her, and knocked her to the ground," Clark said. "Immediately he jumped on top of her, started strangling her. She passed out, and then he set her body on fire."

Clark said Smith burned the woman's body "to hide evidence like DNA." He said "at some point, he bound her up." The doctor was found with her hands and feet tied behind her back.

The captain said that before today's arrest Smith's record consisted of only "minor traffic offenses."

Philadelphia Police Department/AP Photo

Pa. Doctor Killing: Person of Interest in Custody Watch Video

Philadelphia Doctor's Murder Leaves Police Baffled Watch Video

Police received a call from Ketunuti's dog-walker about the house fire around 12:30 p.m. Monday, and once inside found Ketunuti with her hands and feet bound. They believe Smith hit her and strangled her with a rope, causing her to pass out, and then bound her body and set fire to it in order to destroy evidence, including DNA evidence.

Ketunuti, 35, was fully clothed and police do not believe she was sexually assaulted.

She was a doctor at Children's Hospital of Philadelphia and had lived alone in the Graduate Hospital neighborhood of the city for about three years.

Clark said that homicide detectives scoured the neighborhood for surveillance videos from nearby stores and businesses, and through the video identified the suspect.

Smith was spotted on video getting out of the vehicle and following Ketunuti to her home. The man left her home after an hour and was seen on video circling her home.

Detectives drove to Clark's home in Levittown, Pa., outside of Philadelphia where he lives with a girlfriend and her child, on Wednesday night and brought him back to the Philadelphia police station.

A silver Ford truck was towed from Smith's home, which was the same truck spotted on surveillance video Monday in Ketunuti's neighborhood, sources told ABC News affiliate WPVI.

There, he gave statements that led police to charge him with the murders, Clark said.

Smith will face charges of murder, arson, and abuse of a corpse.

Ketunuti's hospital issued a statement Tuesday that she was "a warm, caring, earnest, bright young woman with her whole future ahead of her," adding that she will be deeply missed.

"[She was] super pleasant, really nice," one neighbor said. "Just super friendly."

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North Korea to target U.S. with nuclear, rocket tests

SEOUL (Reuters) - North Korea said on Thursday it would carry out further rocket launches and a nuclear test that would target the United States, dramatically stepping up its threats against a country it called its "sworn enemy".

The announcement by the country's top military body came a day after the U.N. Security Council agreed to a U.S.-backed resolution to censure and sanction North Korea for a rocket launch in December that breached U.N. rules.

North Korea is not believed to have the technology to deliver a nuclear warhead capable of hitting the continental United States, although its December launch showed it had the capacity to deliver a rocket that could travel 10,000 km (6,200 miles), potentially putting San Francisco in range, according to an intelligence assessment by South Korea.

"We are not disguising the fact that the various satellites and long-range rockets that we will fire and the high-level nuclear test we will carry out are targeted at the United States," North Korea's National Defence Commission said, according to state news agency KCNA.

North Korea is believed by South Korea and other observers to be "technically ready" for a third nuclear test, and the decision to go ahead rests with leader Kim Jong-un, who pressed ahead with the December rocket launch in defiance of the U.N. sanctions.

China, the one major diplomatic ally of the isolated and impoverished North, agreed to the U.S.-backed resolution and it also supported resolutions in 2006 and 2009 after Pyongyang's two earlier nuclear tests.

Thursday's statement by North Korea represents a huge challenge to Beijing as it undergoes a leadership transition, with Xi Jinping due to take office in March.

China's Foreign Ministry called for calm and restraint and a return to six-party talks, but effectively singled out North Korea, urging the "relevant party" not to take any steps that would raise tensions.

"We hope the relevant party can remain calm and act and speak in a cautious and prudent way and not take any steps which may further worsen the situation," ministry spokesman Hong Lei told reporters at a regular press briefing.

North Korea has rejected proposals to restart the talks aimed at reining in its nuclear capacity. The United States, China, Russia, Japan and the two Koreas are the six parties involved.

"After all these years and numerous rounds of six-party talks we can see that China's influence over North Korea is actually very limited. All China can do is try to persuade them not to carry out their threats," said Cai Jian, an expert on Korea at Fudan University in Shanghai.

Analysts said the North could test as early as February as South Korea prepares to install a new, untested president or that it could choose to stage a nuclear explosion to coincide with former ruler Kim Jong-il's Feb 16 birthday.

"North Korea will have felt betrayed by China for agreeing to the latest U.N. resolution and they might be targeting (China) as well (with this statement)," said Lee Seung-yeol, senior research fellow at Ewha Institute of Unification Studies in Seoul.

U.S. URGES NO TEST

Washington urged North Korea not to proceed with a third test just as the North's statement was published on Thursday.

"Whether North Korea tests or not is up to North Korea," Glyn Davies, the top U.S. envoy for North Korean diplomacy, said in the South Korean capital of Seoul.

"We hope they don't do it. We call on them not to do it," Davies said after a meeting with South Korean officials. "This is not a moment to increase tensions on the Korean peninsula."

The North was banned from developing missile and nuclear technology under sanctions dating from its 2006 and 2009 nuclear tests.

A South Korean military official said the concern now is that Pyongyang could undertake a third nuclear test using highly enriched uranium for the first time, opening a second path to a bomb.

North Korea's 2006 nuclear test using plutonium produced a puny yield equivalent to one kiloton of TNT - compared with 13-18 kilotons for the Hiroshima bomb - and U.S. intelligence estimates put the 2009 test's yield at roughly two kilotons

North Korea is estimated to have enough fissile material for about a dozen plutonium warheads, although estimates vary, and intelligence reports suggest that it has been enriching uranium to supplement that stock and give it a second path to the bomb.

According to estimates from the Institute for Science and International Security from late 2012, North Korea could have enough weapons grade uranium for 21-32 nuclear weapons by 2016 if it used one centrifuge at its Yongbyon nuclear plant to enrich uranium to weapons grade.

North Korea has not yet mastered the technology needed to make a nuclear warhead small enough for an intercontinental missile, most observers say, and needs to develop the capacity to shield any warhead from re-entry into the earth's atmosphere.

North Korea gave no time-frame for the coming test and often employs harsh rhetoric in response to U.N. and U.S. actions that it sees as hostile.

The bellicose statement on Thursday appeared to dent any remaining hopes that Kim Jong-un, believed to be 30 years old, would pursue a different path from his father, Kim Jong-il, who oversaw the country's military and nuclear programs.

The older Kim died in December 2011.

"The UNSC (Security Council) resolution masterminded by the U.S. has brought its hostile policy towards the Democratic Peoples Republic of Korea (North Korea) to its most dangerous stage," the commission was quoted as saying.

(Additional reporting by Christine Kim in SEOUL, Ben Blanchard and Sui-Lee Wee in Beijing; Writing by David Chance; Editing by Raju Gopalakrishnan and Ron Popeski)

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Keppel Corp's net profit falls 22% on-year in Q4

SINGAPORE: Falling margins from building oil rigs has hit the bottomline of Keppel Corp.

Net profit for the world's leading rig builder fell 22 per cent on-year to S$305 million in the fourth quarter last year.

Still, full year profit for the conglomerate came in 15 per cent to S$2.24 billion.

Despite lower net profit in the three months ended Dec 31, Keppel Corp still declared a final dividend of 27 cents per share.

As part of its 45th anniversary, Keppel Corp is handing out more goodies to its shareholders.

The company has proposed to distribute one Keppel REIT unit for every five Keppel Corp shares.

That is about 27.4 cents per share based on Keppel REIT's closing price of S$1.37 on Thursday.

Together with the interim dividend of 18 cents, total distribution for 2012 will be 72.4 cents per share.

Keppel Corp said the lower net profit was partly due to lower contributions from its offshore and marine unit.

Offshore and Marine's contribution was 12 per cent lower from a higher base in 2011 when margins were at record highs. It contributes to half of Keppel Corp's net profits.

"Keen rivalry from Chinese and Korean yards have suppressed prices and squeezed margins on newbuilds," said Choo Chiau Beng, chief executive officer at Keppel Corp. "In 2013, we will be completing a record of 22 newbuild units."

Analysts remained upbeat of Keppel's prospects going forward.

They say their financial results still outperformed market expectations.

Keppel Corp expects crude oil prices to stay above US$100 per barrel, supporting the need for more global exploration and production.

But global challenges like the slower US economy and the eurozone crisis from last year will continue to pose uncertainties for Keppel Corp's business.

Keppel Corp's property arm, led by the listed Keppel Land, boosted the group's earnings.

Net profit for the property division was 2.5 times higher than in 2011, offsetting the lower earnings from business in the offshore and marine, and infrastructure.

But Keppel Corp does not expect its property arm to perform better this year.

This is because recognition from sales of completed units at its development Reflections at Keppel Bay is expected to be lower this financial year.

- CNA/xq

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