LE TOUQUET - Washington's closest ally Britain failed to coax France into backing early military action against Iraq today.
US Secretary of State Colin Powell has promised to unveil "compelling proof" on Wednesday that Baghdad is hiding banned weapons from UN inspectors, but French President Jacques Chirac said more could be done to disarm Iraq peacefully.
"We will only adopt a position when we believe that nothing further can be achieved there," he told a joint news conference with British Prime Minister Tony Blair after a summit in the French seaside town of Le Touquet.
Amid this fresh evidence of divisions, the European Union considered calling an emergency summit after Powell's address.
The EU was also discussing whether to join a possible last-ditch Arab peace mission to Iraq, where several thousand volunteers paraded in the northern town of Mosul chanting, "No Peace, No Surrender" in the latest show of defiance.
Israel stepped up preparations for possible Scud missile strikes from Iraq and Israeli and US soldiers fired Patriot missiles in a joint exercise.
Italian Prime Minister Silvio Berlusconi, who held talks with US President George W Bush last week, said he thought a decision on taking military action against Iraq was less than a month away.
"I don't think more than four weeks will be needed to make the case for military action," Berlusconi told reporters when asked whether military action over Iraq's alleged weapons of mass destruction might begin in weeks or months.
Britain said it would begin loading tanks from Germany onto 20 to 30 ships this week, indicating a possible mid-March start date for a ground war against Iraq.
Blair, trying to straddle the yawning gap between the United States and key members of the EU over a war, won tentative support from Bush last week to agree to seek new authorisation from the United Nations for any attack.
But France, along with neighbour and fellow Security Council member Germany, insists everything must be done to disarm Baghdad without war. France has not ruled out vetoing in the Security Council any action it deems unjustified.
Both Blair and Chirac said after their meeting that differences remained over Iraq but they had agreed Iraqi President Saddam Hussein had to be disarmed through the UN Security Council.
Bush also wants to rally as many countries as possible behind a war to disarm and depose Saddam but insists time is running out and has warned that any new UN resolution should not be used as a delaying tactic.
US officials said Powell would use satellite photos and intercepted conversations among Iraqi officials to make his case that Iraq was pursuing banned weapons.
Financial markets reeled in anticipation of the speech, due to start shortly after 4.30am Thursday (NZDT), with gold, the traditional safe haven in times of turmoil, hitting seven-year highs, bond prices rising and stocks battered again.
EU president Greece was sounding out other members on convening a possible summit following Powell's address as long as there was a clear understanding of what it could achieve, a spokesman for the European Commission said on Tuesday.
Greek Foreign Minister George Papandreou, who has been rallying Arab states to press Saddam to avert war by complying with UN disarmament resolutions, said in Beirut an Arab peace mission to Iraq was a "real possibility" and the EU might join.
Arab officials said worried leaders in the region were also exploring 11th hour solutions to get assurances the Iraqi army would be kept intact to prevent a post-Saddam Iraq disintegrating into rival Shi'ite, Sunni and Kurdish enclaves.
In a bid to spare the potentially costly losses of a devastating war, part of the intention is to encourage the military to topple the Iraqi leader in a coup or persuade Saddam to accept exile by offering him and his henchmen a safe haven.
In a warning of the difficulties ahead, the head of Iraq's largest dissident party said Washington risked dragging a post-Saddam Hussein Iraq into violence and chaos if it chooses to go it alone without involving Iraqi opposition groups.
Iraq radiated defiance again on Tuesday, insisting the US had no true evidence to present to the UN Security Council and asserting that it would provide the council with "lies".
"I do not think that the United States has anything frightening," Iraqi Vice President Taha Yassin Ramadan told reporters in Damascus, where he met top officials.
Powell wrote in the Wall Street Journal on Monday that although there was still no "smoking gun," the world must recognise Iraq had defied the world body.
The Kremlin said Bush telephoned Russian President Vladimir Putin on Tuesday to discuss the latest developments, adding that Putin had stressed UN arms inspectors had a key role to play "in defining further steps over Iraq".
Moscow hardened its stance towards Baghdad on January 28 and many analysts say it will not use its veto on the UN Security Council to block US military action formulated in any new Council resolution or even abstain.
- REUTERS
Herald feature: Iraq
Iraq links and resources
France sticks to Iraq stance ahead of US speech
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