Government peace talks with right-wing AUC paramilitaries in northern province of Cordoba underway following May “Ralito II” accord. Senior AUC members given safe conduct to address Congress in Bogota 28 July. Leader Salvatore Mancuso stated willingness to work towards permanent ceasefire. Leftist FARC killed 13 government soldiers in 22 July attack on bridge in southern Putumayo province; ruled out possibility of peace with President Uribe. At least 20 killed in eastern Colombia in 8-9 July due to infighting between rival right-wing paramilitary groups.

Donors conference in Washington 19-20 July resulted in pledges totalling $1.1 billion. Police-rebel tensions rising: gunmen killed 2 policemen and injured another in Port-au- Prince 15 July. Police responded with 20 arrests. 3,000 Aristide supporters celebrated his birthday in capital 15 July. PM Gerard Latortue announced measures will be taken after 15 September to disarm gangs with illegal weapons; rebels denounced plan. Former Chilean foreign minister Juan Gabriel Valdes appointed UN special representative to Haiti.

Protesters overran southern city of Ayacucho 1 July, setting fire to buildings after police used tear gas to break up demonstration by teachers. Government blamed followers of Shining Path rebel group for mayhem. CGTP labour union called 1-day general strike 14 July in protest at government’s economic policies; 76 arrested. President Toledo’s approval rating reportedly remains below 7%.

President Hugo Chavez declared would stand for immediate re-election if he loses 15 August recall referendum, raising tensions as opposition insisted this would be illegal.

In positive development, hardline Chief of Staff Lt. General Mohammed Lamari offered resignation, indicating President Bouteflika’s growing authority over defence ministry and security policy. Ongoing media crackdown, with Al-Jazeera temporarily banned 2 July; Le Matin editor’s appeal of 2-year sentence to be heard 11 August. Having admitted June power-station explosion was car bomb, security forces claimed success against Salafist Group for Preaching and Combat with death of 9 gunmen east of Algiers 23 July.

Atef Ebeid, PM since 1999, replaced 9 July by younger Ahmed Nazif - commentators said limited scope for reform, although new cabinet includes technocratic modernisers close to President Mubarak’s son, Gamal. Egypt extended possible offer of security training to Iraqi forces, leading to kidnapping of Egyptian diplomat Mamdouh Helmi Qutb in Baghdad 23 July; released 3 days later.

Tehran restarted construction and assembly of nuclear centrifuges, following through on threat made after critical June IAEA resolution. Paris meeting 29 July between Iran and France, Germany, and Britain failed to resolve differences - U.S. Sec. State Colin Powell said matter increasingly likely to be referred to UN Security Council. Iraqi interim government expressed growing concern Iranian agents infiltrating country to undermine democratisation. U.S. 9/11 Commission report indirectly linked Iran to hijackers, saying some crossed into Iran from Afghanistan. Canada rejected acquittal of Iranian intelligence officer accused of murdering Iranian-Canadian journalist while in police custody, and recalled ambassador.

Under pressure from UN, 3-day National Conference postponed to mid-August in effort to draw more representative range of delegates and improve security preparations. Several key factions, including that of Shiite cleric Moqtada al-Sadr, threatened boycott. Conference to bring together 1,000 delegates to select 100-member National Council, designed to check power of interim government until scheduled January 2005 elections. Insecurity across much of Iraq continued. Over 100 killed 28 July in multiple attacks, including suicide bombing in Baquba, northeast of Baghdad, that left at least 70 dead. Insurgents increasingly relying on hostage-taking as terror tactic: Philippine government ordered early troop withdrawal to secure release of kidnapped Filipino, drawing U.S. and Australian criticism. NATO announced vague training mission for Iraqi military personnel 30 July. 635 Coalition soliders, including 539 Americans, and thousands of Iraqis killed by hostile fire since declared end of combat operations on 1 May 2003.

Political crisis in Gaza eased as PM Ahmed Qurei retracted resignation after receiving assurances from Yasser Arafat he would have authority to carry out security reforms. Crisis began with series of kidnappings by Palestinian gunmen protesting corruption in Palestinian Authority, followed by wider demonstrations when Arafat appointed cousin as head of revamped security services. Arafat later reversed appointment. Factional power struggle likely to continue ahead of Israel’s’ planned Gaza pullout in early 2005. Palestinians won diplomatic victory at UN as General Assembly voted 150 to 6 in favour of resolution urging Israel to abide by International Court of Justice opinion declaring Israeli security barrier in West Bank illegal. Israel said would ignore ruling, but planned to reroute section of barrier closer to 1967 border in line with Israeli Supreme Court decision. IAEA head Mohamed ElBaradei visited Israel 6 July for talks on ridding Middle East of nuclear weapons.

King Abdullah said Amman would consider sending troops to Iraq if asked by interim government - first Arab country to make offer. Militants in Iraq kidnapped 2 employees of Jordanian company working for U.S.; threatened to target Jordanian interests, including road to Iraq, unless Amman ceased cooperation with U.S. forces.