EU and Syria reportedly close to signing landmark trade accord; sides still negotiating sensitive clause on Syria’s WMD program.

Government said activities of Kurdish political parties would no longer be permitted, 3 months after unrest left 30 Kurds dead. Negotiations on major trade agreement with EU stalled over Syrian refusal to renounce weapons of mass destruction. [Last month’s CrisisWatch incorrectly reported agreement had been signed.]

In long-anticipated and largely symbolic move, U.S. imposed economic sanctions on Syria 11 May. Meanwhile, EU agreed wording of landmark trade accord with Damascus; includes clause with WMD benchmarks. Authorities said group of 4 Syrian radical Islamists responsible for 27 April bombing in diplomatic district of Damascus.

Mysterious bombing and subsequent gun battle in Damascus killed 2 suspected militants and 2 others, including policeman. Authorities have not released identities of presumed attackers, and motivation for bombing remains unclear. U.S. again warned Damascus to stem flow of foreign fighters into Iraq after Marines stepped up interdiction efforts along Syrian border. Amnesty International said Syria still holding hundreds of Kurds arrested in last month's rioting.

Anti-government protests by Kurdish minority rocked several cities in northern Syria in country’s worst spate of violence in years. Violence broke out after 11 March football match between Kurdish and Arab teams. Security services opened fire on protesters, killing at least 25, and arrested hundreds. U.S. reportedly set to impose economic and possibly diplomatic sanctions on Syria in near future.

Damascus passed messages to Israel via Turkey offering to restart peace talks broken off 4 years ago. U.S. pressure over Iraq remained high, with Donald Rumsfeld accusing Syria 23 February of allowing militants to cross into Iraq, and with U.S. government debating whether to apply sanctions authorised by Syria Accountability Act.

President Assad dismissed Israeli President Moshe Katsav’s invitation to Jerusalem for peace talks, but both sides agreed to Turkish mediation offer. David Kay, head of U.S. group searching for Iraq WMD, said some weapons and documents may have been hidden in Syria, adding to already strong U.S. pressure on Damascus for cooperation in war on terror.

Syrian President Bashar al-Assad urged U.S. to help restart talks over Golan Heights, captured by Israel in 1967 war. Israel reacted sceptically to peace overtures and in late Dec- ember announced plan to double number of settlers in Golan Heights. Elsewhere, Syrian authorities arrested 6 men believed to be al Qaeda couriers and confiscated US$23.5 million.

U.S. Senate approved sanctions bill threatening tough measures if Syria found to be supporting terror groups or pursuing WMD. In Beirut, leader of Hizbollah, Sheikh Hassan Nasrallah, said his fighters would retaliate if Israel attacked Lebanon or Syria; Israeli airstrike near Damascus in October was first attack in 30 years.

Israeli strike on apparently abandoned training camp near Damascus first direct hostilities between two sides in 30 years. Risk of further escalation as Syria unlikely to satisfy Israeli demands that it stop supporting Palestinian militants. U.S. House of Rep. voted to impose economic and diplomatic sanctions on Damascus as American officials complained Syria taking almost no steps to stem terrorism.