Clashes during Tunisia protest over economy

TUNIS, Tunisia — Clashes erupted in one of three Tunisian cities where tens of thousands of people demonstrated Wednesday over their declining economic situation, calling for greater investment in their impoverished regions.

Dozens of protesters attempted to storm government offices in the southern mining town of Gafsa before being driven back by tear gas. They later ransacked the local headquarters of the moderate Islamist Ennahda party that dominates the government, tossing the furniture out the third story windows and setting it alight in the street while crowds cheered.

General strikes were called in the northwestern city of Siliana, Gafsa and in Gabes, which is along the southeastern coast, calling for greater government investment. Witnesses reported that all shops and cafes were closed.

Tunisia kicked off the Arab Spring by overthrowing its dictator in 2011, partly over the lack of jobs of young people, especially in the impoverished interior. Nearly three years after the revolution, however, the elected Islamist-led government has been unable to jump-start the economy or redress the historic inequalities between the wealthier coast and the poorer interior.

"We live in desperate conditions because of unemployment, poverty and misery and we are only asking to live in dignity," said Badreddine Hamlaoui, a 19 year-old who lost an eye to birdshot during protests in Siliana exactly one year ago. "I ask myself why Siliana is neglected and excluded from development."

The timing of Wednesday's strikes was to mark the one-year anniversary of the Siliana protests when people marched to call for a new provincial governor and were dispersed by police wielding shotguns. At least 332 people were wounded, many partially blinded by the birdshot.

According to the National Institute of Statistics, unemployment is already a high 15.7 percent in the country, but in places like Siliana or Sidi Bouzid, where the revolution first began when a young fruit vendor set himself on fire, it rises to 20-29 percent — double that for young people.

"We continue to be forgotten and marginalized because of the policies of the current government," said Mohammed Miraoui, head of the local labor union branch in Gafsa. "From one day to another, the economic and social situation is deteriorating with not a single project from the 2012 budget even implemented."

Since its election in October 2011, Ennahda has ruled with two smaller secular parties, but amid the unrest, unmet expectations and terror attacks following the revolution, has been unable to stem the economy's slide.

On Monday, the Moody's international rating service downgraded Tunisia's government-issued bond rating another notch to Ba3, now three levels below investment grade.

The downgrade follows that of Fitch on Oct. 30 and S&P's in August, both well below investment grade, making it even more difficult for Tunisia to borrow on international markets and further reducing international confidence in the North African nation's economy.

Since the revolution, international ratings agencies have been steadily dropping the country's investment grade in light of the unrest and now a political deadlock.

The demonstrations come after the government acceded to opposition demands to step down in favor of a Cabinet of technocrats before new elections, but talks have now broken down over who will be the caretaker prime minister.

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Israel: EU funds will not reach occupied land

JERUSALEM — Israel will ensure that money it receives under a technology-sharing pact with the European Union will not be spent in the West Bank or east Jerusalem, an Israeli official said Wednesday, acceding to a European funding ban on projects in the occupied territories.

Israel and Europe reached a compromise Tuesday that enabled Israel to sign on to a 70 billion euro ($95 billion) research program known as "Horizon 2020."

Israel had feared that new EU guidelines preventing funding of projects or institutions in the West Bank, east Jerusalem and other territories Israel captured in 1967 would make it ineligible for many of the funds granted in the research program, since most universities and research centers have some activities in those territories.

Israel's Deputy Foreign Minister Zeev Elkin said Israel and the European Union agreed that Israeli institutions that operated in the occupied territories could apply for funding under the program, but that they would need to ensure that any money they receive be spent only inside Israel proper.

"Every Israeli entity will be able to apply. If it receives the money, it will need to find a mechanism, with the Europeans, that will allow the Europeans to achieve their objective: that their money ... will not go beyond the Green Line," Elkin told Israel Radio, referring to Israel's pre-1967 war frontier with the West Bank.

The European Union, along with much of the international community, considers Israeli settlements in the West Bank and east Jerusalem illegal and an obstacle to the establishment of a Palestinian state.

The Palestinians want those territories, along with the Gaza Strip, for their future state. Elkin said the EU compromise also included an Israeli statement objecting to the European position on settlements.

Elkin added that Israel would compensate institutions that are ineligible for the EU funding because they are located in the occupied territories.

The "Horizon 2020" program enables participants to apply for funds for research and collaboration in areas such as climate change, renewable energy and food safety. The EU has budgeted more than 70 billion euros ($95 billion) for the program, which is to run from 2014 to 2020. Officials estimate that Israel could gain more than 300 million euros ($400 million) from the complicated funding system over the seven-year period.

The EU's top diplomat in Israel, Lars Faaborg Andersen, called the compromise excellent news. "It will allow the EU and Israel to continue their mutually beneficial partnership in science and technology," he said in a statement.

Palestinian official Nabil Shaath praised the Europeans for sticking to their opposition to the settlements. "It's time for the Israelis to understand that all the international community is against settlements," he said.

The Israeli daily newspaper Haaretz said that despite the last-minute compromise, the spat with the EU indicated that Israel "is now beginning to pay the price of its deeds in the occupied territories."

"The settlement enterprise has turned Israel into an immoral state whose policies are unacceptable to the world of which it seeks to be part," it said in an editorial.

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Greek economy seen shrinking further next year

ATHENS, Greece — A leading international economic body predicted in a report Wednesday that Greece's economy will shrink further next year and that the government might need more financial help.

The Organization for Economic Cooperation and Development said the Greek economy would contract 0.4 percent in 2014, in contrast to the Greek government's forecast for 0.6 percent growth.

However, the OECD did say the economy was improving, and that the recession was expected to come to an end.

"Positive growth is projected only in the course of 2014, reflecting a slower decline of domestic demand and a pickup in exports," it said in its survey.

Greece's economy is contracting for a sixth consecutive year, and the government has been relying on rescue loans from the International Monetary Fund and other European countries since May 2010.

"We are half a decade into the longest, deepest recession that we have known but there is hope on the horizon and 2014 promises to be a turning point for Greece," OECD Secretary General Angel Gurria said during a news conference.

The government has insisted the country will return to growth in 2014, and will post a modest primary surplus — the budget balance without taking into account outstanding interest payments.

"The 2014 budget is the budget of the Greek economy's recovery after six years of recession," Finance Minister Yannis Stournaras said during a speech to Parliament's finance committee Wednesday.

Speaking later at the news conference with Gurria, Stournaras noted he had "some disagreements with the growth projections, given that the general consensus is that we do expect to have growth in 2014, even at a modest rate."

The billions of euros of rescue loans have been contingent on Greece implementing broad structural and fiscal reforms. Successive governments have imposed repeated rounds of austerity measures, including slashing pensions and salaries, and increasing taxes.

While improving certain aspects of the economy, such as the reduction in Greece's annual budget deficit, the reforms have contributed to a sharp drop in living standards and spiraling unemployment, particularly among the young, where the jobless rate is over 60 percent.

"The depression has been much deeper than expected, which has undermined debt sustainability, induced a dramatic rise in unemployment, which affected more than 27 percent of the labor force at mid-2013 and raised social tensions, especially in the first years of the program," the OECD said in its economic survey for Greece.

It said growth was hampered by weak domestic and global demand and difficulty accessing credit.

"Together with the additional adjustment needed on the fiscal side and price competitiveness, the need for further assistance to achieve fiscal sustainability cannot be excluded," the report said.

There was praise, however, for how far Greece has come, with the organization saying the country achieved "a record fiscal consolidation by OECD standards" that managed to reduce the country's massive deficit.

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Russia outraged by giant Louis Vuitton suitcase

MOSCOW — Politicians didn't like it, the public didn't like it, so the gigantic Louis Vuitton suitcase is being booted out of Red Square.

The GUM department store on Red Square, which is responsible for 30-feet (nine meters) high and 100-feet (30-meters) long construction, promised in a statement released Wednesday that it would be dismantled.

Politicians and public alike condemned the exhibit, a stone's throw from the tomb of communist leader Vladimir Lenin. State news agencies reported that the Kremlin had demanded the removal of the display.

The construction is part of an exhibition called "The Soul of Travel," marking Vuitton's 150th anniversary and was to open on Dec. 2. Louis Vuitton said the construction was a copy of a model owned by a Russian noble, Prince Vladimir Orlov.

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CVS Caremark to buy Coram for $2.1 billion

NEW YORK — Drugstore chain CVS Caremark Corp. says it has agreed to buy the drug infusion business Coram LLC, a unit of Apria Healthcare Group Inc., for $2.1 billion.

Coram, which is based in Denver, provides customers with medication and nutrition that is administered through a vein. The medication can be delivered to a customer's home, clinic or doctor's office.

CVS expects the deal to close by the end of the first quarter of 2014.

CVS expects Coram to generate revenue of about $1.4 billion in the first year after the deal closes and add earnings of between 3 cents per share and 5 cents per share in 2015.

Apria Healthcare Group Inc., Coram's parent company, is owned by investment firm The Blackstone Group LP.

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UK-based Standard Chartered opens branch in Iraq

BAGHDAD — British bank Standard Chartered PLC says it has opened a branch in Iraq's capital, Baghdad and that it hopes to play a role in the country's economic growth.

A statement said Wednesday that the main aim is to meet the increasing banking needs of its multinational clients in Iraq and to support large government projects. It says a second branch will be opened next month in the self-ruled northern Kurdish region and a third will be opened in 2014 in the oil-rich southern city of Basra.

The move came nearly five months after U.S.-based Citigroup Inc. opened an office in Baghdad.

Iraq has been struggling to attract Western companies outside the oil sector since the U.S.-led invasion. Security worries and political infighting have been the major concerns of foreign firms.

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Gauge of US economy's health edges up 0.2 percent

WASHINGTON — A measure of the U.S. economy's health increased in October, suggesting consumers and businesses mostly shrugged off the 16-day partial government shutdown.

The Conference Board says its index of leading indicators rose 0.2 percent in October to a reading of 97.5. It was the sixth gain in seven months and followed large gains in the previous two months.

The index is designed to signal economic conditions over the next three to six months. The steady gains point to improvement, although the index is comprised of indicators that have already been released individually.

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Judge moves airline merger step closer to takeoff

A federal bankruptcy judge has cleared the way for American Airlines and US Airways to close their merger and create the world's largest airline.

The judge ruled Wednesday that this month's settlement of an antitrust lawsuit filed by the federal government didn't upset American's bankruptcy-reorganization plan, which is built around the merger. He rejected a request by a group of consumers to block the deal temporarily.

American said immediately after the ruling that it plans to complete the merger on Dec. 9.

The Justice Department had sued to block the deal in August, saying that it would hurt competition and lead to higher prices. But regulators settled their case in exchange for the airlines' promise to surrender some coveted landing rights at Reagan National near Washington and LaGuardia in New York and a few gates at five other airports.

Together, American and US Airways will be slightly larger in passenger traffic than United Airlines and Delta Air Lines, currently the world's biggest carriers after recent mergers of their own.

U.S. District Court Judge Sean Lane in New York had approved the merge-and-emerge-from-bankruptcy plan of American parent AMR Corp. back in September, but said it was on condition that the company won or settled the lawsuit filed by the government.

At a hearing in Lane's courtroom Monday, a lawyer for a group of consumers asked the judge to block the merger until a trial could be held on his antitrust lawsuit, which made many of the same arguments that had been raised — and dropped — by the government.

Lane denied the request by the lawyer, Joseph Alioto of San Francisco, saying that his clients had failed to show that letting the airlines merge would hurt them. The judge said that if Alioto wins his lawsuit, he can demand additional divestitures by the two airlines but can't hold up the merger.

At the same time, the judge granted American's request that it be allowed to close the merger without submitting the settlement with the Justice Department to a vote of creditors and shareholders. A committee representing unsecured AMR creditors including American's labor unions backed the company's request.

AMR filed for bankruptcy protection in November 2011 after losing billions of dollars in the previous decade. Almost immediately, US Airways began pursuing a merger. AMR management was initially reluctant, but the two sides announced a merger deal in February 2013. The new company will be called American Airlines Group Inc. and be based in Fort Worth, Texas.

A separate federal court will oversee a 60-day period in which the public can comment on the government's settlement with AMR and US Airways Group Inc., but that won't stop the merger.

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4 cities vie to host 2020 world's fair

PARIS — Delegations from Brazil, United Arab Emirates, Russia and Turkey are gathering in Paris on Wednesday to find out who will host the 2020 World Expo.

At stake are billions of dollars in investment, tourism and a moment in the global spotlight.

While the World's Fair no longer holds the popularity of other global events like the Olympics or World Cup, it remains a chance for millions from around the world to discuss and see the business of the future.

The Bureau International des Expositions, the Paris-based intergovernmental body that has organized the fairs since 1928, will decide among four contenders: Dubai in the UAE; Sao Paulo, Brazil; Yekaterinburg, Russia, and Izmir, Turkey. Delegates from the BIE's 168 member countries will vote behind closed doors to choose the winner.

The next world expo is scheduled to take place in Milan in 2015. Last year Astana, Kazakhstan, was awarded the 2017 world expo.

DUBAI

In Dubai, the logo of its bid for the 2020 expo is plastered on police cars, convenience store bags, storefronts, taxis, receipts, government buildings and even on a flag on Mount Kilimanjaro. Dubai's rulers say their futuristic Persian Gulf city of skyscrapers is ideal to host the event.

A spending spree is already underway for the expo — even before officials announce which city will host it.

Dubai estimates a successful Expo 2020 bid will generate $23 billion between 2015 and 2021, or 24 percent of the city's gross domestic product. They say total financing for the 6-month-long event will cost $8.4 billion. But many worry that increased building and real-estate speculation driven by the event could put it on the cusp of another financial crisis.

SAO PAULO

Brazil is already hosting next year's World Cup and the 2016 Olympics — but will it get the World Expo, too?

One of the highlights of Sao Paulo's bid is a proposed renewable energy tower that will convert solar energy into the electricity needed for the event.

The city wants to create a new economic, tourism and education hub with hotels, schools, shopping malls, shops and Latin America's largest convention center. Afterward, the pavilions would be used as schools, health centers and theaters, and the lodgings for employees will be converted into a low-cost housing project.

YEKATERINBURG

Russia has been treating its bid to hold the expo as a state priority not unlike its bids to host the Winter Games and the World Cup.

Officials expect that hosting the expo in the Ural Mountains city of Yekaterinburg would cost Russia $4 billion, the local governor said last week, adding that half of it would come from the budget and the remaining half from private investors. The organizers are planning to build 103 pavilions for the expo and accommodation for exhibition participants, which will later be converted into a residential area.

Russian officials said the expo will help to attract investors and their money to the Yekaterinburg area.

IZMIR

Turkey's loss of its bid to host the 2020 Olympic games in Istanbul was a political blow to Prime Minister Recep Tayyip Erdogan. The disappointment adds to the stakes of landing the World Expo for Izmir, Turkey's third-largest city.

Izmir, an Aegean coastal city formerly known as Smyrna, is pushing global health and environmental issues for its bid. To bolster its case, Turkey has chosen award-winning architect Zaha Hadid to design the park for the exposition.

Turkey's transportation and communications minister, Binali Yildirim, told reporters this week that he believes the bid has the support of more than 60 countries.

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Associated Press reporters Aya Batrawy in Dubai, Stan Lehman in Sao Paulo, Nataliya Vasilyeva in Moscow, and Suzan Fraser in Ankara, Turkey, contributed to this report.

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Follow Greg Keller on Twiter: http://twitter.com/Greg_Keller

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Xbox, PlayStation tackle console launch glitches

Move over, zombies. Step aside, terrorists. Aliens, out of the way.

There are a few new foes affecting gamers that are proving to be far more destructive than any on-screen villain.

With nicknames like "the blue light of death" and "the disc drive of doom," they're the game-ending glitches causing headaches for a few gamers who picked up the next-generation Xbox One and PlayStation 4 consoles at launch.

Microsoft Corp. said Monday it's replacing the Xbox One units of users who have reported systems that won't read discs, an issue dubbed "the disc drive of doom." The company said the problem is affecting "a very small number" of customers, who will also receive one free downloadable game from Microsoft Game Studios.

Sony Corp. announced after the debut of the PS4 earlier this month that it was replacing the units for "less than 1 percent" of users whose new consoles malfunctioned and displayed a pulsating blue light. The problem was given the moniker "the blue light of death."

Both glitches recall Microsoft's "red ring of death," when production problems caused several predecessors of the Xbox One to lock up and display three flashing red lights. Ultimately, the technology giant extended customers' warranties to three years and said in 2007 that it had spent more than $1 billion to repair the problems associated with the Xbox 360.

"I understand these things happen, but it sucks when they happen to you," said Donald Blankinship, an Xbox One owner who experienced a faulty disc drive after purchasing the console at Best Buy. "I can still play downloadable games until the replacement arrives, so at least there's that."

Other users have reported consoles being completely unresponsive out of the box. Both Sony and Microsoft said they're working to troubleshoot such issues and replace broken consoles as quickly as possible.

While the issues seem to affect a minority of Xbox One and PS4 owners, the concerns could deter consumers who regularly play games on smartphones and mobile devices. Sony's PS4 costs $399. Microsoft's Xbox One cost $100 more and includes a Kinect sensor.

"When I think about the Xbox brand, we want it to mean quality," said Phil Spencer, corporate vice president of Microsoft Game Studios, at last week's Xbox One launch event. "That's critical to us. I think you can overcome things, but we don't plan on that. We plan on testing it — tens of thousands of hours — to make sure it's going to be a solid launch."

Microsoft and Sony both announced that more than 1 million Xbox One and PS4 consoles were sold in the 24 hours after their release this month. It's been seven and eight years respectively since Microsoft and Sony launched the Xbox 360 and PlayStation 3. Sony said it expects to sell 5 million PS4 units by the end of its fiscal year in March.

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Follow AP Entertainment Writer Derrik J. Lang on Twitter at http://www.twitter.com/derrikjlang .

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