Malaysia coalition extends rule despite worst electoral showing

By Stuart Grudgings and Al-Zaquan Amer Hamzah

KUALA LUMPUR (Reuters) - Malaysia's governing coalition extended its half-century rule despite its worst-ever performance in a general election, potentially undermining Prime Minister Najib Razak and exposing growing racial polarization in the Southeast Asian nation.

Najib, 59, could come under pressure from conservatives in his ruling party for not delivering a stronger majority in Sunday's election despite a robust economy and a $2.6 billion deluge of social handouts to poor families.

The National Front won 133 seats in the 222-member parliament, down from 140 in 2008 and well short of the two-thirds majority that Najib had aimed to capture. The opposition won 89 seats, up from 82 last time.

Kuala Lumpur's stock market could gain on Monday on investor relief that the untested opposition failed to take power, but any optimism could be tempered by the prospect of political uncertainty due to the weak win. The Malaysian ringgit surged to a 10-month high early on Monday.

While support for the ruling coalition from majority ethnic Malays remained solid, ethnic Chinese who make up a quarter of Malaysians continued to desert the National Front, accelerating a trend seen in the previous election.

Ethnic Chinese have turned to the opposition, attracted by its pledge to tackle corruption and end race-based policies favoring ethnic Malays in business, education and housing.

"We will work towards more moderate and accommodative policies for the country," a grim-faced Najib told a news conference after the majority was confirmed. "We have tried our best but other factors have happened ... We didn't get much support from the Chinese for our development plans."

Former Prime Minister Mahathir Mohamad, still a powerful figure in the dominant United Malays National Organisation (UMNO), told Reuters in an interview last year that Najib must improve on the 140 seats won in 2008. Najib could face a leadership challenge from within UMNO later this year as a result of falling short.

ANWAR CRIES FOUL

The National Front also failed to win back the crucial industrial state of Selangor near the capital Kuala Lumpur, which Najib had vowed to achieve.

The three-party opposition alliance led by former deputy prime minister Anwar Ibrahim had been optimistic of a historic victory, buoyed by huge crowds at recent rallies.

But as counting went late into Sunday night, it became clear that the fractious opposition would be unable to unseat one of the world's longest-serving governments and pull off what would have been the biggest election upset in Malaysia's history.

After claiming an improbable early victory, Anwar later said he rejected the result because the Election Commission (EC) had failed to investigate evidence of widespread voter fraud.

"It is an election we consider fraudulent and the EC has failed," he said.

The National Front has significant advantages, including its deep pockets, control of mainstream media, and an electoral system skewed in its favor.

"The new government does have a credibility deficit at the very moment due to the very tenacious and contentious election process," said Oh Ei Sun, a senior fellow at the S. Rajaratnam School of International Studies in Singapore.

"I think they have to redouble their efforts in rebuilding their trust among the people."

Anwar had accused the coalition of flying up to 40,000 "dubious" voters, including foreigners, across the country to vote in close races. The government says it was merely helping voters get to home towns to vote.

The opposition also lost control of the northern state of Kedah, one of four it had taken over in the 2008 success.

The 2008 result signaled a breakdown in traditional politics as minority ethnic Chinese and ethnic Indians, as well as many majority Malays, rejected the National Front's brand of race-based patronage that has ensured stability but led to corruption and widening inequality.

Ethnic Chinese parties affiliated with the National Front suffered heavy losses in 2008 and were punished by voters again on Sunday. The National Front's ethnic Chinese MCA party won just five seats, down from 15 in 2008, according to the latest count.

That leaves the National Front dominated more than ever by ethnic Malays, who make up about 60 percent of the population, increasing a trend of racial polarization in the country.

"There needs to be an effort to look back at racial harmony," said Khairy Jamaluddin, the head of UMNO's youth wing and a member of parliament. "We don't want the results to be looked at through a racial lens."

(Additional reporting by the Reuters Kuala Lumpur bureau; Writing by Stuart Grudgings and Niluksi Koswanage; Editing by Jason Szep and Paul Tait)

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Egypt proceeds with judiciary law despite uproar

CAIRO (AP) — Egypt's Islamist-led parliament on Wednesday pushed ahead with a law that could force into retirement many of the nation's most senior judges, despite an uproar by the judiciary over fears the president's allies want to control the courts.

The country's Judges' Union, which represents thousands of Egypt's judges, warned they would not recognize the law or even the discussions in parliament about it. They vowed to turn to international organizations, such as the United Nations and African Union, to investigate what they said are violations against the judiciary.

More than 6,000 judges from around the country gathered in Cairo Wednesday to decide on a strategy in their power struggle with President Mohammed Morsi.

The crisis over the judiciary is a reflection of the deep polarization that has split the country.

The judiciary, with mostly secular-minded professional judges, is seen by many Egyptians as the one of the only remaining buffers against Islamists' monopoly on power following the ouster of authoritarian ruler Hosni Mubarak in 2011. Since then, Islamist parties have swept elections and dominated legislative councils and the presidency.

President Mohammed Morsi's Muslim Brotherhood party counters that many judges are holdovers from the Mubarak era who must be replaced. Morsi's supporters engaged in violent street clashes last Friday with opponents over calls to "cleanse the judiciary."

In an escalation of the crisis, the legislative committee of the upper house of parliament voted in favor of three draft laws on the judiciary proposed by Islamist groups. It opened the floor for further debate.

One, proposed by Morsi's Freedom and Justice party, the political arm of the Muslim Brotherhood, drops the retirement age for judges from 70 to 60, which would affect nearly a quarter of Egypt's 13,000 judges and prosecution officials.

The draft also would forbid the courts from reviewing or overturning presidential decrees issued by Morsi late last year, including his appointment of a new top prosecutor. The prosecutor remains in place despite a court order last month annulling his appointment.

The opposition vowed to step up its campaign against the bill. Activist groups who helped topple Mubarak, such as the April 6 Movement, are demanding reform of the judiciary and support its independence. April 6 warned in a statement against replacing remnants of Mubarak's regime with Morsi's loyalists.

The head of the criminal court in Cairo's sister city of Giza, Fahmy Munir, was among those at the Judges' Union meeting.

"We tell them, don't transgress against the judiciary," he warned the government, adding that violations against the judiciary are akin to "a challenge to the people."

Presidential spokesman Ihab Fahmy told reporters Wednesday that the Islamist president respects the judges.

"The president wants to contain the judiciary crisis," he said. "The president firmly stressed that it's unacceptable to hurt or encroach on the judiciary."

Among the setbacks the judiciary dealt the president's backers was disbanding the Islamist-dominated parliament last year, citing unconstitutionality of the election law. Last month, the courts challenged a law governing parliamentary elections that were supposed to begin this month, delaying the vote indefinitely. The president's party was pushing for early elections.

The proposal in parliament by the president's party also requires judges to oversee polling stations and punishes those who refuse to carry out their duties — though the job used to be voluntary. Last year, during the vote over a contentious draft of the country's new constitution that was written by Morsi's allies, many judges boycotted the vote to protest a decree that temporarily granted Morsi's decisions immunity from judicial review.

The head of the Judges' Union, Ahmed el-Zind, said they would not go on strike as many did last year, but they would seek international help.

During the parliamentary session, independent lawmaker Tharwat Nafaa ripped up a letter sent by the Judges' Union. The letter demanded the parliament stop debating the law because it said the constitutionality of the body was in dispute.

Before thousands of judges late Wednesday, union chief el-Zind questioned Nafaa's political affiliation. "Are you really independent?" he shouted during his lengthy speech.

The crisis over the judiciary also has prompted the resignations of top Morsi aides.

On Monday, the Morsi's top legal adviser, Mohammed Fouad Gadallah, resigned, saying he wanted to shed light "on the extent of the danger facing the country" at a time when "personal interests are overwhelming national interests."

Two days earlier, Justice Minister Ahmed Mekki submitted his resignation. He was a pro-reform judge under Mubarak before becoming a minister in Morsi's Cabinet. He was criticized by liberals for continuing to serve under Morsi, while Islamists chided him for not supporting the disputed bill.

___

AP writer Sarah El Deeb contributed to this report.

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Egypt's Mubarak still jailed despite release order

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Albania sacks poll official despite international warnings

By Benet Koleka

TIRANA (Reuters) - Albania's parliament sacked an election official on Monday despite warnings from the country's international partners that the move could damage domestic and overseas confidence in June parliamentary elections.

The fresh political row came after Prime Minister Sali Berisha saw his main coalition ally jump ship to join the opposition ahead of the June 23 elections, but its representative in the seven-member Central Election Commission (CEC) stay put.

Berisha's government survived last week with the votes of three disgruntled opposition lawmakers and their votes again helped sack the election official and bring the commission back under the effective control of his ruling Democratic Party.

"You are asking to destroy the current balance. This is wrong, agreements should be respected," Berisha told the opposition Socialist Party before thanking its three breakaway lawmakers for voting with the government.

During the vote, one opposition lawmaker unsuccessfully tried to prevent a colleague voting for the government move by pulling him out of the chamber.

The Socialists called it a Pyrrhic victory for Berisha and said neither he nor Albania would gain by "staining" the process.

The CEC certifies the results of elections administered by party militants who often show less regard for the law than for party orders, leading to charges of manipulation and fraud.

The marathon parliamentary session started in the morning and ended before midnight as lawmakers from both sides debated whether the CEC and its members were effectively non-partisan after election by the parties.

Members of the CEC are nominated by the main parliamentary parties and their smaller allies, with four nominated by the government and three by the opposition. Most votes in the routine management of the election need a simple majority and some major ones a five-to-two majority.

Both the United States and the European Union have told all parties the election must be free and fair if the former communist country is to advance its bid to join the European Union.

An EU statement said it was the responsibility for all political sides to ensure a non-partisan electoral administration.

"The EU expresses concern and shares the preoccupations of other partners over the possible repercussions of a vote in parliament on the people's confidence in the electoral process," it said ahead of a visit to Tirana on Tuesday by EU foreign policy chief Catherine Ashton.

A NATO member, Albania has lagged behind its Balkan neighbors in stepping closer to the EU due to a lack of compromise between its main parties and the need for far-reaching reforms.

The United States said the independence of the CEC should be respected, even by parliament, and U.S. Ambassador Alexander Arvizu said changing the rules did not inspire confidence in the ballot.

"I don't think anyone wants a decision or action that is going to put Albania on a collision course with the U.S. and the international community," Arvizu told reporters.

(Reporting By Benet Koleka, Editing by David Brunnstrom)

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Bank of England set to keep policy steady despite new remit

By David Milliken

LONDON (Reuters) - The Bank of England is unlikely to pump fresh money into Britain's stagnant economy on Thursday, despite a new remit that gives it extra leeway to disregard above-target inflation.

Chancellor George Osborne tweaked the central bank's mandate two weeks ago, giving it stronger backing to continue ignoring inflation when it overshoots its target due to one-off factors.

But only a handful of economists polled by Reuters last week expect the central bank to add this month to the 375 billion pounds of government bonds it bought between March 2009 and October 2012.

"For as long as you say there is a 2 percent inflation target, I think what we have got at present is about as close as you can get without breaching the spirit of that," said Ross Walker, UK economist at Royal Bank of Scotland.

Other economists only see a chance of more stimulus once Mark Carney - currently Canada's central bank chief - becomes governor of the BoE in July.

Carney is believed to favour other ways to help the economy such as long-term promises of low interest rates.

British inflation has mostly been above target since the start of the financial crisis due to one-off price shocks - for example, higher sales tax - and the Bank's desire to avoid a surge in unemployment by tightening policy prematurely.

Inflation rose to 2.8 percent in February, and the bank does not forecast it to fall below 2 percent until early 2016.

However, the economy has been stagnant over the past two years. After a 0.3 percent contraction in the last three months of 2012, it risks tipping into its third recession in less than five years.

That risk will be greater if a survey of the service sector in March, due at 0830 GMT(09:30 a.m. British time), shows the same decline as its counterparts for manufacturing and construction published earlier this week.

These conflicting pressures from high inflation and very weak growth help explain why the Bank's nine-member Monetary Policy Committee has been unusually split at its past two meetings.

Bank's Governor Mervyn King, markets expert Paul Fisher, and external MPC member David Miles all voted for an extra 25 billion pounds of bond purchases, but failed to convince their other six peers.

Walker said he expected the impasse to continue. "If there wasn't enough to budge them in February, there's not enough to make them move tomorrow."

March's policy minutes did not suggest either camp's position was softening. Indeed some opposed to more stimulus saw a new reason: the danger that looser monetary policy could trigger a further slide in sterling.

Last month sterling hit a two-and-a-half year low against the dollar and was some 8 percent down since the start of the year, until the minutes and comments from King that the currency was fairly valued helped stem its slide.

However a slim majority of economists think the Bank will restart asset purchases - perhaps as soon as May, when fresh quarterly economic forecasts may sway waverers.

Failing that, the next milestone will the change of leadership at the Bank at the end of June.

"More stimulus should be on its way soon - although we may have to wait for Mr Carney to arrive first," said Vicky Redwood, UK economist at Capital Economics.

(editing by Ron Askew)

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Despite threats, North Korea keeps border factories open

By Ju-min Park

PAJU, South Korea (Reuters) - A heavily armed border crossing between North and South Korea that allows the North access to $2 billion in trade a year, one of its few avenues to foreign currency, remained open on Thursday despite Pyongyang's move to cut communications.

North Korea on Wednesday severed the last of three telephone hotlines with South Korea as it readied its troops to face what it believes to be "hostile" action from Seoul and Washington. The phone line is used to regulate access to the Kaesong industrial park on the North Korean side of the border as well as for military communications with the South.

But nearly 200 South Koreans and 166 vehicles carrying oil and materials drove into the park a few miles inside the impoverished North starting at 2330 GMT after North Korean authorities used a separate phone line from the park's management office to allow access, South Korean officials said.

The North has already cut a direct hotline to U.S. military forces stationed in South Korea and a Red Cross line that had been used by the governments on both sides.

"I am a bit nervous but it looked the same as before when I went in there yesterday," truck driver Park Chul-hee, 44, told Reuters outside the Paju customs office. North Korean soldiers in and around Kaesong had been wearing combat fatigues recently, he added.

Workers and traders crossing the world's most heavily militarized border were making sure they had U.S. dollar bills for the trip, some borrowing from a co-worker to make sure they had enough of the officially accepted currency in the zone.

Pyongyang's harsh rhetoric against Washington including a vow to attack its military bases in the Pacific and to stage a nuclear strike has not yet extended to its willingness to accept dollars, which South Koreans said they had to use to buy cigarettes and other goods in the zone.

The North's move on the hotline was the latest in a series of threats in response to U.N. sanctions imposed after its February nuclear test and to routine military drills conducted by the South Korean and U.S. militaries.

North and South Korea are technically in a state of war because their 1950-53 conflict ended with the signing of an armistice, not a peace treaty.

The North-South military hotline was used on a daily basis to process South Koreans and vehicles across the border and in and out of the Kaesong project, where 123 South Korean firms employ more than 50,000 North Koreans to make household goods.

About 120 South Koreans remain in the park on an average day. The presence of South Koreans at Kaesong poses a potentially serious political risk for Seoul given they could be trapped if Pyongyang sealed the border.

On Thursday, 511 people in 398 vehicles are scheduled to come out of the zone, according to South Korean customs office estimates.

"I think the third nuclear test is the last tipping point. I was worried so I came out," said one South Korean who has been running a factory in Kaesong for six years and who requested anonymity due to the sensitivity of the issue.

Few people believe the North will shut down the project.

The $2 billion a year it generates reduces Pyongyang's dependency on China, which accounted for almost $6 billion in trade in 2012, according to South Korean government estimates.

Kaesong also generates more than $80 million a year in cash in wages. This is paid to the state rather than to workers.

(Writing by Jack Kim, Editing by Dean Yates)

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Despite free treatment, British health rankings decline

LONDON (Reuters) - Years of universal healthcare, rising health spending, cancer screening, immunisation and anti-smoking laws have failed to stop Britain falling behind in reducing early death and disease, a study showed on Tuesday.

Researchers who compared Britain's health performance since 1990 with 14 European Union countries plus Australia, Canada, Norway and the United States said its pace of decline in premature death was "persistently and significantly" behind the average - a finding they described as "startling".

Chris Murray, who led the work at the University of Washington, said Britain's poor performance was partly due to dramatic increases in Alzheimer's disease and in drug and alcohol abuse problems, and to a failure to tackle leading killers such as heart disease, strokes and lung diseases.

"Concerted action is urgently needed," said Murray, director of the university's Institute for Health Metrics and Evaluation.

Using data from a vast study called the Global Burden of Diseases, headline findings of which were published last year, researchers analysed patterns of ill health and death in Britain, calculated the contribution of various preventable risk factors, and ranked it among high-income countries that spent similar amounts on health in 1990 and 2010.

They found that only in men older than 55 years had Britain seen significantly faster drops in death rates than other nations over the last 20 years.

Britain's ranking in premature mortality rates for adults aged between 20 and 54 had "worsened substantially", they found.

This was partly due to dramatic growth in problems linked to drugs and alcohol, which were ranked among the least important causes of death in this age group in 1990 - ranked 32nd and 43rd respectively - but rose to sixth and 18th place in 2010.

"WAKE-UP CALL"

Kevin Fenton, Director of Health and Wellbeing at Public Health England, who worked with Murray on the study, said the findings were "both a wake-up call and an opportunity".

"While it's encouraging that overall the health of the UK has improved substantially since the last report the pace of improvement is not enough," he said in a statement.

Overall, the study found, Britain's eight leading causes of death have changed little in the last 20 years, with heart disease, chronic obstructive pulmonary disease, stroke, lung cancer and lower respiratory infections remaining the top five.

There has also been a startling increase Alzheimer's disease - which rose from 24th to 10th place - in cirrhosis, which is linked to alcohol abuse, and in drug use disorders. They rose from 14th to 9th position and from 64th to 21st respectively.

The study found that in 2010, Britain had significantly lower premature death rates from diabetes, road injuries, liver cancer and chronic kidney disease on average than other nations.

But it had not kept pace on rates of early death from other conditions such as heart and lung diseases, breast and oesophageal cancer and preterm birth complications.

Commenting on the findings, Edmund Jessop from the UK Faculty of Public Health in London, said there was "plenty of room for bold action by politicians".

He said ministers should introduce tighter health policies such as plain packaging for cigarettes, a minimum price for alcohol, a ban on trans fats, improved control of hypertension and a greater focus on psychiatric disorders.

"Alternatively, the UK can continue to languish at the bottom of European league tables," he said.

(Reporting by Kate Kelland; editing by Andrew Roche)

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Adventure travel grows despite occasional disaster

NEW YORK (AP) — When Carole Rosenblat was growing up in the 1970s, her parents' idea of an adventurous vacation was "driving cross-country from Michigan to California in a non-air-conditioned car with three kids."

Her idea of adventure is a little different: "Jumping out of planes — things like that. Parasailing, hot-air ballooning. These things make you know you're alive!"

And the balloon accident in Egypt that killed 19 people Tuesday is not likely to deter her from future adventures. "It does not give me pause at all," said Rosenblat, a freelance writer and occasional tour guide based in Gilbert, Ariz.

Rosenblat's attitude is part of what's fueling worldwide growth in adventure travel. It's an $89 billion industry, according to the Adventure Travel Trade Association, and it has grown 17 percent in each of the past two years, according to the association's president, Shannon Stowell. That's four times the rate of the overall tourism industry, which grew about 4.6 percent in 2011.

But while travelers may think nothing of bungee-jumping or whitewater rafting as the perfect way to bring home bragging rights, these types of activities are not risk-free. Indeed, while statistically rare, accidents involving adventure vacations happen on a regular basis. To cite just a few recent headlines: This past weekend, a woman was swept away and drowned in Hawaii on a hiking trip with 55 people. Recreational diving deaths have been reported this month in both California and Florida. A woman parasailing in Florida last summer died when her harness gave way, one of 70 parasailing deaths in the past 30 years. And 54 skiers and snowboarders died in accidents on U.S. ski slopes last season, according to the National Ski Areas Association.

The industries that promote these activities are quick to note that driving is by far the most dangerous thing you're likely to do at home or on vacation. An estimated 36,200 people died in motor vehicle accidents in the U.S. in 2012.

In contrast, in the past decade, only 15 people have died in ballooning accidents in the U.S., according to the National Transportation Safety Board. Glen Moyer, spokesman for the Balloon Federation of American, noted that balloon operations in the U.S. are heavily regulated by the Federal Aviation Administration, including licensing and training for pilots, plus balloon inspections for every 100 hours of commercial flight time.

"When we hear about a dramatic event like a balloon exploding, it plumbs the depths of our fears, whereas when we hear about an automobile accident — not so much," said Stowell, the Adventure Travel Trade Association head. "The reality is that with adventure travel overall, if you're going with a good operator who knows what they're doing, you are as safe or safer than when you're on your own in a vehicle."

Hot-air ballooning has been around for centuries, but many travelers still consider it as exciting as parasailing or bungee jumping.

Christopher Elliott, an editor at large for National Geographic Traveler, has spent the past year traveling with his kids for a project called AwayIsHome.com. He said that planning their itinerary every day involves asking, "Is this an acceptable risk?" — most recently when snowshoeing on a frozen lake in Canada.

"It's a judgment call," Elliott said. "I would not have hesitated to get on that balloon and put my family on the balloon. It's not something ridiculously dangerous like feeding the lion raw meat with your hand from a Jeep. That's what makes it so troubling: We could see ourselves on that balloon and we'd be dead now."

But he added that sedentary vacations are, for many people, a thing of the past.

"People expect more from their vacations, and that sometimes involves high-risk activity," he said. "We want all our friends to think we took the most exciting vacation. And maybe some of it is driven by reality shows or the Travel Channel. Everyone wants that extreme experience."

Is there any way for consumers to protect themselves from unnecessary risks? For one thing, Stowell said, do your homework. Before signing up for an adventure, look on websites like TripAdvisor for consumer reviews, contact industry associations to learn about safety recommendations, and ask for referrals from trustworthy sources like travel agents, cruise operators or hotel concierges.

Experts also recommend travel insurance. Peter Greenberg, CBS News travel editor, says most Americans don't realize their health insurance does not protect them overseas. Make sure any travel policy you buy covers medical treatment, as well as evacuation and transportation to the facility of your choice, Greenberg said.

Pauline Frommer, the travel guidebook writer, noted that "many insurance policies specifically exclude injuries that arise from these sorts of adventure activities, which can be an ugly surprise for travelers. So, if you're planning on bungee jumping or canyoneering or some other type of adventure activity, be sure to get a policy that will actually cover you should something go wrong."

Linda Kundell, a spokeswoman for the U.S. Travel Insurance Association, said standard policies may cover ordinary recreation like hiking and skiing, but you can also buy policies for extreme sports. In either case, consumers should double-check what's covered.

While many of these types of activities require consumers to sign a waiver of liability in case of accident, as Elliott put it, "you sign that piece of paper and you don't even read it."

"People assume they're entitled to have the best of both worlds: Extreme adventure and complete safety," he added. "That does not align with reality."

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