Fighting flares in al Qaeda-held Yemen city (Reuters)

SANAA (Reuters) – Fighting flared on Tuesday in a southern Yemen city seized by al Qaeda and other Islamist militants, killing at least 15 people, after Washington urged President Ali Abdullah Saleh to hand over power peacefully.

Saleh left for Saudi Arabia at the weekend for surgery on wounds suffered in an attack on his palace in Sanaa -- an absence that could be an opportunity to ease him out of office after nearly 33 years ruling the impoverished Arab nation.

Global powers worry that chaos would make it easier for the Yemen-based wing of al Qaeda to operate and multiply risks for neighboring Saudi Arabia and other Gulf oil producers.

"We are calling for a peaceful and orderly transition," U.S. Secretary of State Hillary Clinton said on Monday, adding that this would be in the best interests of the Yemeni people.

Yemen's acting leader, Vice President Abu-Rabbu Mansour Hadi, said Saleh would return within days, but the position of Saudi Arabia, which has traditionally played an influential role in Yemeni politics, could now be decisive.

Saudi officials say they will not interfere in Saleh's decision to return to Yemen or not, but Western powers may want to revive a Gulf Cooperation Council-brokered transition deal that would have secured Saleh's resignation.

"Saleh's departure is probably permanent," said Robert Powell, Yemen analyst at the Economist Intelligence Unit.

"The Saudis, as well as the U.S. and European Union, are pushing hard for him to stay in Saudi Arabia, as they view the prospect of his return as a catastrophe.

"Prior to his departure, the country was slipping inexorably into a civil war. However, his removal has suddenly opened a diplomatic window to restart the seemingly failed GCC-mediated proposal. It seems Saudi Arabia and other interested parties are unwilling to allow Saleh to derail it this time."

Al Qaeda in the Arabian Peninsula (AQAP), which has used its Yemen base to stage daring but abortive attacks on Saudi Arabia and the United States, seized the southern city of Zinjibar about 10 days ago with other militants. The city is near a shipping lane where about 3 million barrels of oil pass daily.

Locals and Yemeni troops have stepped up fighting to retake Zinjibar, local official said. More casualties are expected in the city, once home to about 50,000 people, but now mostly a ghost town due to the battle for control.

There was also fresh fighting in the city of Taiz, south of Sanaa. A Saudi-brokered truce was holding in the capital after two weeks of fighting between Saleh's forces and tribesmen in which over 200 people were killed and thousands forced to flee.

POWER TRANSFER

Saleh, a wily political veteran, has defied global calls to accept the GCC-mediated power transition deal, backing away three times at the last minute from signing it.

Saleh, 69, was wounded on Friday when rockets struck his Sanaa palace, killing seven people and wounding senior officials and advisers in what his officials said was an assassination attempt. He is being treated in a Riyadh hospital.

The future of Yemen, riven by rivalries among tribal leaders, generals and politicians, is uncertain. Saleh's sons and relatives remain in Yemen, commanding elite military units and security agencies.

Other contenders in a possible power struggle include the well-armed Hashed tribal federation, breakaway military leaders, Islamists, leftists and an angry public seeking relief from crippling poverty, corruption and failing public services.

Youthful protesters have been celebrating Saleh's departure, but are wary of any attempt by the wily leader to return.

"In the near term, the biggest challenge is to set up a viable political reform process that has the general backing of the population, and allows Yemen to return to normal after months of unrest," the EIU's Powell said.

"In the medium term, Yemen's biggest challenge is economic -- already the poorest country in the Middle East, it is running out of oil and water, and unless it can find alternative drivers of growth an economic collapse is entirely feasible," he said.

(Additional reporting by Arshad Mohammed in Washington, Mohammed Mukhashaf in Aden and Alistair Lyon in London; Writing by Jon Herskovitz; Editing by Alistair Lyon)

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Anger flares at Egypt army for lethal protest raid

By Khaled Desouki, AFP/Getty Images

Egyptians walk past a burnt armed forces truck at Tahrir Square in Cairo on Saturday after clashes with military police.

EnlargeCloseBy Khaled Desouki, AFP/Getty Images

Egyptians walk past a burnt armed forces truck at Tahrir Square in Cairo on Saturday after clashes with military police.

In the pre-dawn raid, hundreds of soldiers, including a highly trained parachute unit, swarmed into Tahrir Square, firing in the air and beating protesters with clubs and shocking some with electrical batons. Troops dragged away protesters, while others staggered away bleeding from beatings and gunshot wounds. Witnesses reported two killed, though the Health Ministry insisted there was only one death.

"It was like a horror movie," said Mohammed Yehia, an activist and university student from the Nile Delta who was among the protesters.

DEMANDS: Protesters want Mubarak prosecutedISLAMISTS: Look for gains in EgyptTOURISM: Country waits for visitors to returnThe confrontation escalates weeks of rising tensions between the pro-reform protest movement and the military leaders, a sharp contrast from the scenes two months ago when protesters hugged and kissed soldiers on tanks in Tahrir Square as President Hosni Mubarak was ousted and the military took power.

It could mark a key juncture in Egypt's upheaval. For weeks, protest leaders have been critical of the military council's handling of the post-Mubarak transition and its failure to prosecute the former president, but both sides also worked to stay on good terms. Now the overnight clashes resembled the ugliest moments of the 18-day protest movement against Mubarak — with authorities cracking down violently and protesters chanting for the leader's removal.

Soldiers detained 41 youth protesters in the raid, said human rights lawyer Mohammed al-Ansari, and they now face military tribunals for violating military bans on gatherings.

The bloodshed opened rifts in the protest movement over how to react. Some demanded protesters push ahead with the confrontation with the military, while others warned a conflict with the army — Egypt's most powerful institution — would be disastrous for the movement, saying some form of coexistence must be found.

Democracy advocate Mohammed ElBaradei, whose supporters were among those who organized the wave of anti-Mubarak protests, said in a Twitter message that "dialogue is the only alternative." He said "confidence between the people and army" must be preserved "for the sake of the nation."

Egypt's largest Islamic group, the Muslim Brotherhood, also warned against any attempt to cause divisions between the people and the army, calling them "one hand."

But anger flared at a press conference held at Cairo's Journalist Syndicate, where representatives of various political parties and movements tried and failed to produce a joint statement on the night's events.

Amr Hamzawy, co-founder of a new liberal political party, the Egyptian Social Democratic Party, called for all sides to exercise "extreme measures of restraint," warning of "organized" attempts to cause conflicts with the military.

But Khaled Abdel-Hamid, a member of the coalition of youth activists that organized the anti-Mubarak campaign, denounced a series of incidents of excessive use of force by the military against protesters.

"Now there is blood between the people and the armed forces. This happened three times, why are they not prosecuting those responsible for it," Abdel Hamid said, sparking shouting matches among some defending the military and others demanding the "killers" be put on trial.

Back in Tahrir Square, several thousand protesters, some armed with sticks and other makeshift weapons, vowed not to leave until the defense minister, Field Marshal Mohammed Hussein Tantawi, resigns. Tantawi, a Mubarak appointee, leads the Supreme Council of the Armed Forces, which now rules Egypt and is made up of the military's top generals, promoted to their current positions also by Mubarak.

Black smoke rose as protesters set fire to three vehicles in the square, including two troop carriers. The square was filled with shattered glass, stones, and debris in a scene reminiscent of the protests that brought down Mubarak on Feb. 11. The glass storefront of a KFC on the square was also smashed — only weeks after it was repaired from damage during the anti-Mubarak protests.

"We are staging a sit-in until the field marshal is prosecuted," said Anas Esmat, a 22-year-old university student in Tahrir as protesters dragged debris and barbed wire to seal off the streets leading into the square.

"The people want the fall of the field marshal," chanted protesters. "Tantawi is Mubarak and Mubarak is Tantawi," went another chant.

The military's heavy crackdown appeared prompted in part by the presence in Tahrir of around 25 army officers who joined the protesters and were denouncing the military's leadership, saying Mubarak was continuing to rule through Tantawi and the other generals. In a public statement Saturday, one of the officers demanded the dissolving of the Supreme Council, its replacement by a presidential council and the prosecution of those behind the killing of protesters.

The military blamed the turmoil on "thugs" and "outlaws" who had infiltrated the protesters in the square and violated the country's 2 a.m. to 5 a.m. curfew. In a press conference Saturday evening, the council also blamed "foreign hands" and claimed that armed protesters fired on themselves.

The assault on the protesters came hours after tens of thousands of Egyptians massed in Tahrir Square on Friday in one of the biggest rallies in weeks, demanding the military prosecute Mubarak and his family for corruption that permeated his nearly 29-year regime.

At around 3 a.m. on Saturday, hundreds of soldiers backed by a line of armored vehicles swept into the square, firing heavy barrages into the air with automatic weapons and pounding transparent shields to intimidate protesters camped out in the center of the roundabout.

The troops waded into the tent camp, where protesters had formed a human cordon to protect the army officers who had joined them.

Yehia, the university student activist, described how a friend of his ripped off his shirt and stood between protesters and the soldiers, chanting "peaceful, peaceful" until soldiers beat him with clubs and electric batons, leaving him covered in bruises. Soldiers kicked and beat another man who had fallen to the ground, he said.

Ali Mustafa, a car mechanic who was guarding the "free soldiers" tent, said he saw an attacking soldier stab one of the officers to death with his bayonet. He pointed to a section of pavement stained with blood under a small pile of garbage and food remains. Witnesses reported that two of the 25 officers were arrested by the soldiers but others escaped.

Another protester was shot dead, said Ahmed Gamal, who said he helped carry away the body. The deaths could not be confirmed.

The Health Ministry issued a statement saying only one person was killed and 71 wounded, some of them with gunshot wounds, including three in critical condition.

Witnesses said the troops beat protesters with batons, fists and kicks and dragged protesters away and threw them into police trucks. Near the famed Egyptian Museum, which overlooks the square, protesters trying to flee were blocked by soldiers, who hit them and knocked them.

"I saw them detain a bunch at the museum. They were beating some pretty badly," said one protester, Loai Nagati.

Several hundred — including women and children who had been among the protesters — fled to a nearby mosque for refuge, with families searching frantically for children lost in the melee.

During the 18 days of protests that led to Mubarak's ouster, protesters embraced the army after it refused to open fire on their rallies, and many welcomed the army's move to step in to rule.

But tensions have since grown. Reports have emerged of some protesters including blogger who campagined against army abuse, arrested and tortured by the military in past weeks. Many have complained that the military's handling of the transition to democracy has been too secretive, ignoring some demands, and too fast.

But the failure to prosecute Mubarak and his family has stoked the most anger, touted by some as a sign that Tantawi and the other generals are protecting the former president. Prosecutors have put on trial or started investigations against a string of former senior figures from Mubarak's regime on allegations of corruption, exploiting their positions to amass personal fortunes and other crimes.

But so far, there has been no move against Mubarak or his son Gamal, who had been widely seen as his choice as successor. Since his ouster, Mubarak and his family have been under house arrest at a presidential palace in the Red Sea resort of Sharm el-Sheikh, their assets frozen.

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