Anti-Jewish outburst clouds Bush's Asia trip

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An anti-Jewish tirade by Malaysia's Prime Minister, Mahathir Mohamad, has further darkened prospects for President George Bush's trip to Asia, already overshadowed by terrorism, tensions over Iraq and a deepening currency dispute with Japan and China, the United States' two biggest trading partners in the region.

Malaysia attempted yesterday to defuse the controversy two days before the start of the Apec summit, the centrepiece of Mr Bush's otherwise whirlwind six-day trip to Asia and Australia. Dr Mahathir's remarks to leaders of Muslim countries - he claimed that Jews "rule the world by proxy" and that "1.3 billion Muslims could not be defeated by a few million Jews" - had been taken out of context, the Malaysian Foreign Minister, Syed Hamid said.

The point of his speech to the 57-nation Organisation of the Islamic Conference (OIC) had been to warn against the use of violence and urge social and economic revitalisation in the Muslim world, said Mr Hamid. Instead, "they have misunderstood the whole thing".

But Dr Mahathir stuck to his guns, saying that the Foreign Minister's comments did not amount to an apology. "Are we not allowed at all to criticise the Jews if they do things which are wrong?" the Prime Minister said at a news conference. "If Muslims can be accused of being terrorists, then others can accuse the Jews of being terrorists also."

The row sent ripples across three continents, underscoring the gulf in outlook and attitudes that divides the Bush administration and the Muslim world, and creating tensions even at an otherwise humdrum European Union summit in Brussels. In Washington, capital of Israel's staunchest ally, the State Department said it had nothing but "contempt and derision" for the outburst, and several other countries called them totally unacceptable.

But in Brussels, France's President, Jacques Chirac, backed by other members including Greece, prevented the two-day summit from issuing a formal statement denouncing the Malaysian Prime Minister. Other leaders wanted such a condemnation, but the French President insisted there was "no place" in an EU declaration for such texts. Silvio Berlusconi, Prime Minister of Italy, which holds the EU's rotating presidency, criticised Dr Mahathir at a post-summit press conference.

France's behaviour is unlikely to help mend diplomatic fences badly damaged by the Iraq crisis. Of more immediate concern to the US, however, some of its closest allies in Asia have also refused to distance themselves from Dr Mahathir, who is to step down this month after 22 years in office.

Hamid Karzai, the Afghan President who was installed by the US after the overthrow of the Taliban in 2001, said he did not consider the language to be anti-Semitic. Similar sentiments were expressed by Megawati Sukarnoputri, President of Indonesia, the world's most populous Muslim country.

The divisions only underline how thin may be the veneer of comity and friendship Mr Bush encounters as he completes what one US official has called "the trip from al-Qa'ida hell". Even in Tokyo, where the US President was warmly greeted, major differences exist, including Washington's mixed policy on North Korea and its pressure on Tokyo to allow the yen to rise against the dollar.

His hosts will not be flattered by the time Mr Bush is allotting to them: 17 hours in Japan, 15 hours in Singapore, eight hours in the Philippines and three in Indonesia. The reason, US officials say, is security risk. Even in Australia, which he described as America's "sheriff" in the area, Mr Bush will stay for just 21 hours - rather less than he devoted to meeting Arnold Schwarzenegger and fund-raising in California before the trip.