Recent polls show that 69% of Pakistanis see the US as more of an enemy than a partner. American taxpayers are increasingly asking: Why give aid to Pakistanis if they don't want it? So this move is partly driven by pressure in Congress to cut spending to deal with mounting debt. It's also technical - no point sending some equipment if American trainers are not in Pakistan to use it. Big military deliveries won't be affected so the impact is limited.

Still, this is a strong message by the Obama administration - the first time it withholds aid from Pakistan on purpose to express displeasure with its actions. It's an attempt to force the Pakistani army to choose between its relationship with America and its ties with militant groups. It may work, it could also backfire, which is why Washington remains careful not to push too hard.

Pakistan Information Minister Firdous Ashiq Awan said Admiral Mullen's statement was "extremely irresponsible and regrettable". She said it would cause difficulties in relations between the sides and prove a setback to the war against terror. The increasing US drone attack on militants inside Pakistan along the Afghan border is also a continuing source of antagonism.

British military trainers were also withdrawn at the request of the Pakistani government last month.

Mr Fry, 75, is understood to have brokered the Coca-Cola deal, despite accusing the Government last July of being 'bribed' by fast food giants. The money is to develop part of the charity's website devoted to low-calorie artificial sweeteners. Many of Coca-Cola's drinks, such as Diet Coke, Fanta Orange Zero and Lilt Zero, include sweeteners like aspartame, acesulfame-K and saccharin, which have been linked to health concerns. Recent studies linked aspartame to pancreas damage, cancer and premature births.

A senior charity source said: 'In July Tam Fry was horror-struck at the government handing the anti-obesity brief to the likes of Coca-Cola and by the following month he was holding out the begging bowl. Yet it has been known for years that diet drinks are bad in relation to obesity.'

A Coca-Cola spokeswoman said: 'We provided the charity with an educational fund to support its communications regarding low and no-calorie sweeteners during 2011. There is no product endorsement as part of this affiliation.' The charity's chairman David Haslam said: 'We have an independent board assessing the health benefits of artificial sweeteners. Coca-Cola has no influence over our findings.'

It was a sentence that sent shock waves through the international world of media: "This Sunday will be the last issue of the News of the World." The announcement was part of a statement by James Murdoch, the son of Rupert Murdoch and CEO of News Corporation Europe, that was read out to News of the World staff on Thursday afternoon. There will be no commercial advertisements in the paper's final issue, and any advertising space will be donated to charity, Murdoch said in his statement.

The shock decision to close the 168-year-old newspaper came after a week of revelations about a phone-hacking scandal that have put the paper's owner News International - a subsidiary of Rupert Murdoch's News Corporation - under increasing pressure.

Many observers felt that Thursday's decision to close the newspaper was a smart move on the part of Rupert Murdoch's News Corporation. There were fears that the scandal could potentially derail a much bigger deal involving the group's bid to purchase the portion of satellite broadcaster BSkyB that it doesn't already own. By taking decisive action on the News of the World affair, the media giant may be trying to overcome potential resistance to the deal from the British government, which needs to approve the takeover.

The center-left Suddeutsche Zeitung writes:

"All British governments function according to the same reflex: They all want to curry favor with Murdoch and his newspapers. When the tycoon lends his support to the opposition camp, then many people in Britain interpret this as a demand for a change in government."

"There is a trivial motive behind Murdoch's behavior, his market power and his coarse desire for political influence. Murdoch, a despised and unwanted interloper in the British media landscape, yearns for respect and puts the fear of God (into others). Murdoch wants a bigger role in the apparatus of government than is appropriate for a newspaper publisher. Under a feeling of invulnerability, a culture of lawlessness thrived in his company, where his staff did not even shrink from gambling with the fate of abducted children. The British political establishment tolerated this state of affairs - and will now have to pay the price."

Europe needs a strong and powerful center - or it will fail. A situation in which a country like Greece, whose economic output comprises between 2 percent and 2.5 percent of that of the entire euro zone, can imperil the European economy and drag the European common currency to the brink of failure reveals serious design flaws in the political constitution.

Complaints about the fraudulent machinations of the Greeks during their accession to the euro zone, Greece's administrative deficiencies (the country doesn't even have a nationwide land registry office) and the lack of discipline and commitment within portions of the Greek population are a sideshow at best. The real problem is that all these problems were known about 10 years ago - and that no consequences were drawn from this knowledge.

Another example of the failure of the European elites was their claim that the introduction of the euro on the Continent would not only create a market bigger than the US market, but also that the euro also would have what it takes to become the global economy's second reserve currency, next to the dollar. But the parallel to this idea - the need for at least one European rating agency that could hold its own against the American rating agencies - was ignored.

The Europeans were determined to challenge the dominance of the dollar, together with all of the advantages it created for the United States, and yet they positioned the euro in an unprotected environment. It could be attacked at any time because the US rating agencies could seek out the weakest links in the euro group and apply pressure there. The prestige of the euro was and remains highly vulnerable. Instead, a project like the euro should have been prepared in a way that established strategic safeguards.

Even if Europe manages to muddle its way through the euro crisis and the Greek collapse, this underlying problem isn't going to go away. In fact, such crises can repeat themselves at any time. A more or less orderly national bankruptcy for Greece would be merely a tiny step toward saving the euro. The key step is a political reconstitution of Europe, a reconstitution in which democratization would be a real option and would not pose the threat of decline and disintegration.

The Federal Reserve said Friday that consumer borrowing rose $5.1 billion in May, the eighth straight monthly increase. It followed a revised gain of $5.7 billion in April. Borrowing in the category that covers credit cards increased, as did borrowing in the category for auto and student loans.

The overall increase pushed consumer borrowing to a seasonally adjusted annual level of $2.43 trillion in May. That was just 1.7 percent higher than the nearly four-year low of $2.39 trillion hit in September.

Borrowing is a sign of confidence in the economy. Consumers tend to take on more debt when they feel wealthier. That boosts consumer spending. Ultimately, it gives businesses more faith to expand and hire. But an increase in credit card debt can also be a sign of people falling on harder times.

And with three months to go still in fiscal year 2011, the government has racked up $973 billion in total deficits, a pace which is slightly better than 2010, when the government had just crossed the $1 trillion mark at this point. The figures come as lawmakers are trying to hash out a deal on long-term reduction to the country's skyrocketing debt.

CBO analysts said interest on the debt accounts for an ever-increasing share of spending: $31 billion in June alone, and $202 billion for the first nine months of the fiscal year, which is 18 percent higher than 2010.

The government has run a deficit for 33 straight months, dating back to October 2008, when then-President George W Bush and Congress began to grapple with the financial crisis. That's the longest streak since the Treasury Department began keeping records in 1980.

"In the month of Bahman (January 21-February 19) two missiles with a range of 1,900 km (1,180 miles) were fired from Semnan province (in northern Iran) into the mouth of the Indian Ocean," Amir Ali Hajizadeh, head of the Revolutionary Guards' aerospace division, told a news conference some of which was shown on television.

Iran usually tests its missiles in extensive deserts in the heart of the country, so the firing into the Indian Ocean is an unusual move, aimed to prove Tehran's longstanding claims it can hit targets beyond its borders. Television showed a missile being fired but the announcer did not specify if the pictures were of the Indian Ocean test-firing. No pictures were shown of a target being hit at sea.

The announcement came after a 10-day military exercise by the elite Guards that was designed to deter Iran's enemies by showing Iran is ready and able to hit back at US bases in the Middle East and at Israel. The United States and Israel have not ruled out military strikes on Iran if necessary to stop it getting nuclear weapons.

At least a dozen people were hurt in the demonstration for electoral reform in downtown Kuala Lumpur. There were no reports of serious injuries but some analysts said the police action was excessive and would dent Najib's image. "We are not criminals, we are just asking for free and fair elections," opposition leader Anwar Ibrahim's daughter, Nurul Izzah Anwar, told reporters after her father was knocked down and hurt in a melee when he and his supporters were tear gassed.

"Many innocent people were injured. We condemn this act of cruelty by UMNO and Barisan Nasional," she said, referring to Najib's party and the ruling coalition. Street protests are rare in this Southeast Asian nation, but foreign investors are worried that any groundswell of anti-government sentiment could delay economic reforms seen as essential to draw investment.

If he is put under popular pressure, Najib may reconsider plans for a snap election and hold back on reforms such as cutting fuel subsidies or unwinding an affirmative action program for the country's Malay majority.

David Cameron was given a personal guarantee by Rupert Murdoch that Andy Coulson was safe to take on as his Downing Street press chief, The Independent on Sunday learnt yesterday, as the fallout from the News of the World phone-hacking scandal threatened to escalate into all-out war between the UK's two most powerful men.

The Prime Minister had already cooled relations with the 80-year-old press baron on Friday by saying that his son, James Murdoch, has "questions to answer" over News International's handling of the scandal. The Battle of Wapping 2011 will be intensified by the revelation that Mr Cameron was told by Mr Murdoch twice that, despite fears over Mr Coulson's connection to the phone-hacking scandal, there was no problem with the former editor.

After this, Mr Cameron promised he would defend Mr Coulson's position. The 'IoS' (Independent on Sunday newspaper) can reveal that the cosy relationship between the Prime Minister, Mr Murdoch Senior, News International's chief executive Rebekah Brooks and Mr Coulson has been severely damaged by the hacking crisis, which caused the closure of the 168-year-old tabloid newspaper this weekend. Mr Cameron faces serious questions over his judgement in appointing Mr Coulson, who was arrested on Friday by police investigating hacking and illegal payments to police officers.

Meanwhile British Prime Minister David Cameron came under pressure to speed up an inquiry into the allegations of widespread voicemail-hacking, which could jeopardize News Corp's plan to take over the British broadcaster BSkyB. The scandal has raised questions about relations between politicians, including Cameron - who hired a former editor of the paper as his spin doctor - and powerful media owners such as Murdoch, 80.

It has also brought to light accusations that journalists working for Murdoch and others paid police for information. The front-page headline on Sunday's final edition of the 168-year-old News of the World, best known for its lurid stories of wrongdoing and the sexual misdemeanors of celebrities, said simply "Thank You & Goodbye."

Alan Rusbridger, editor of the left-leaning Guardian newspaper, which has led the way in uncovering the scandal, said in a video on the Guardian's web page: "We've had both the prime minister and the leader of the opposition making the kind of statements that a week ago would have seemed suicidal for politicians, essentially conceding they had turned a blind eye to the abuse of press power because they wanted to keep in with Rupert Murdoch."

Ordinary people are providing what help they can for families sheltered in the ruins of former government buildings. Somalia is at the centre of a drought affecting around 10 million people in four countries in the Horn of Africa. There are daily deaths in Mogadishu, with eight people dying overnight in just one area.

The rains have begun and with temperatures dropping, children and the elderly are becoming ill. Islamist militants of al-Shabab, who control much of the country except for the capital, have established a camp outside Mogadishu for drought victims. But they are discouraging people from crossing into government held areas, or leaving for camps in Kenya and Ethiopia.

There, international organisations have set up tents, food stores and clinics.

The US Treasury says it will be forced to default on its obligations if Congress does not raise the $14.3 trillion debt ceiling, which caps how much it can borrow, by August 2. The Treasury has not specified which bills it wouldn't pay, but the prospect of its missing interest or principal payments on any outstanding debt is a terrifying one for Wall Street.

Even temporary default would erode the United States' status as the world's most powerful economy and the dollar's role as the dominant global currency. "It would be catastrophically bad to tell the world that the United States is willing to default on its obligations," said Gregory Whiteley, who helps manage $12 billion in assets at DoubleLine Capital in Los Angeles. "Even if the default only lasted a few days, the precedent would be set."

A default would undermine confidence in Treasuries, the world's safest asset and the benchmark for the global bond market, particularly if ratings agencies were to cut the United States' prized AAA credit rating. If investors start demanding higher returns for holding riskier US debt, the rise in bond yields would crank up borrowing costs for consumers and businesses. This in turn could tip a still fragile economy back into recession.

Standard and Poor's told Reuters last week it would waste no time cutting the top-notch US credit rating if Treasury missed a $30 billion debt payment on August 4. Robert Tipp, chief investment strategist at Prudential Fixed Income, with $240 billion in assets, said long-term interest rates could swiftly rise by up to 50 basis points.

Based on the projected budget deficit, that amounts to an extra $70 billion in interest costs - a fairly hefty price to pay for a country already facing a large debt burden. Robert Brusca, chief economist at Fact and Opinion Economics, reckons a default could be a lot more costly, knocking Treasury prices down 5 to 10 points in a day - a violent and unusual move. "This could be a horror show."

In a startling response to the scandal engulfing Murdoch's media empire, the British newspaper arm of News Corp announced it would publish the 168-year-old News of the World for the last time this weekend. As allegations multiplied that its journalists hacked the voicemail of thousands of people, from child murder victims to the families of war dead, the tabloid haemorrhaged advertising, alienated millions of readers and posed a growing threat to Murdoch's hopes of buying broadcaster BSkyB.

The scandal has also become an embarrassment for Cameron. The prime minister chose former News of the World editor Andy Coulson as his communications director, even though one of Coulson's reporters and a private investigator had been convicted of hacking into the phones of royal aides. Coulson insisted he knew nothing about it, but as new allegations surfaced, Coulson resigned from Cameron's team in January.

The Guardian reported that Coulson would be arrested on Friday over suspicions that he knew about or had direct involvement in phone hacking during his editorship of the News of the World from 2003-2007. The announcement on Thursday that the News of the World was to close was one of the most dramatic in the 80-year-old Murdoch's controversial career, and is widely seen as an effort to prevent the crisis spreading beyond the tabloid to more lucrative parts of his empire.

Murdoch's son James, who chairs the British newspaper arm of News Corp, said the News of the World, which his father bought in 1969, had been "sullied by behaviour that was wrong. Indeed, if recent allegations are true, it was inhuman and has no place in our company," he said in a statement.

Growing popular and political anger over the phone hacking saga had spurred concerns that there could be snags in securing government approval for News Corp's $14-billion (8.77 billion pounds) bid for BSkyB, of which it already owns 39 percent. Cameron's government has given an informal blessing to the takeover, despite criticism on the left that it gave Murdoch too much media power.

Investigations into phone hacking at the tabloid have been bubbling for several years. Until recently only celebrities and other public figures were believed to have been victims. But the scandal exploded earlier this week after revelations that an investigator working for the paper may have listened to - and deleted - the voicemail messages of a missing 13-year-old schoolgirl, later found murdered.

The scandal deepened on Thursday with claims News of the World hacked the phones of relatives of British soldiers killed in Iraq and Afghanistan. Several major brands pulled advertising from the title. Police have also been criticised over allegations officers took money from the News of the World for information.

Admiral Michael Mullen, speaking to the Pentagon Press Association, said Iran had curtailed weapons shipments, including powerful rockets and roadside bombs, in 2008 but resumed them recently. Top-level officials in Tehran know about the weapons shipments, he said.

"Iran is very directly supporting extremist Shiite groups which are killing our troops," said Admiral Mullen, chairman of the Joint Chiefs of Staff. "There is no question they are shipping high-tech weapons in there... that are killing our people. And the forensics prove that."

The Wall Street Journal first reported in its weekend editions that Iran's Islamic Revolutionary Guard Corps was shipping arms to allies in Iraq and Afghanistan. Iranian officials interviewed for that article denied the charge. On Thursday, two more US troops were killed by a roadside bomb outside a Baghdad military base. Officials believe an explosively formed projectile, many of which are manufactured in Iran, was responsible. The weapons are designed to penetrate layers of armor.

For decades Sudan had been at war with itself, with around two million people being killed and the development of the nation - both North and South - held back. The latest bout of civil war, which began in 1983, came to an end with a Comprehensive Peace Agreement, signed by both sides in 2005. South Sudan became independent after a massive majority of 99% pledged support for cutting the ties with Khartoum.

But the price of independence is still to be fully calculated. There is as yet no official demarcation of the actual borderline between North and South and there has been fighting in the border area in recent weeks. The United Nations has peacekeeping troops in the town of Abiyei after Northen forces raided the area several weeks ago.

The other big deal for both North and South is oil. Eighty per cent of the reserves are in the South, but the majority of the refineries, and crucially the pipeline to the outside world, are in the North. Currently the revenues are split 50/50, but that agreement lapses with independence and there is no replacement as yet.

London educated Lieutenant General Majak D'Agoot, who heads the South's intelligence service, says all the people, both North and South, are "tired of war". But he says that if the South is pressed "the two states may spiral into a perpetual state of warfare". A challenging backdrop to the first steps into nationhood.