Berlusconi allies guilty over prostitutes

A Milan court has found three of Silvio Berlusconi's associates guilty of procuring prostitutes. Source: AAP

A MILAN court has found three of Silvio Berlusconi's associates guilty of procuring prostitutes - including the then underage Ruby - for racy parties held at the former Italian premier's villas.

Failed showbusiness agent Lele Mora and television host Emilio Fede were sentenced on Friday to seven years each in jail, while showgirl-turned-politician Nicole Minetti was given five years behind bars.

Among the girls allegedly recruited by the trio for parties at billionaire Berlusconi's villas was Moroccan-born Karima El-Mahroug, a then 17-year-old exotic dancer nicknamed "Ruby the Heart Stealer".

Berlusconi was sentenced in a separate trial in June to seven years in jail for paying for sex with Ruby and abusing his power to hide the liaison - though the punishment was suspended on appeal.

The Milan court on Friday banned Moro and Fede for life from holding public office and working with minors, while Minetti was given a five-year ban on holding public office.

All three were ordered to pay court costs.

In his summing up speech in May, prosecutor Pietro Forno said the three had arranged "orgies" at Berlusconi's mansion and cited the tycoon's ex-wife Veronica Lario, who accused her then husband of consorting with "young virgins".

His colleague Antonio Sangermano said the three were like "tasters of fine wine" and had obtained financial advantages from Berlusconi because "they know all the secrets" of those nights.

"They carried out a sort of exam of the capacities of the young women and then injected them into the circuit of soirees," Sangermano said. Minetti was also an active participant and "performed sexual acts for money," he said.

All three denied the charges, insisting that while they may have invited girls to the premier's Milan villas, it was to attend nothing more than elegant dinner parties.

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Israel frees Palestinians as talks gesture

US Secretary of State John Kerry says Israeli and Palestinian negotiators will resume peace talks. Source: AAP

ISRAEL says it will release some Palestinian prisoners as a "gesture", as the two sides agreed to meet to pave the way for their first direct talks in three years.

The announcement came hours after US Secretary of State John Kerry told reporters in Amman late on Friday that Israeli and Palestinian negotiators had laid the groundwork to resume the frozen peace talks.

Kerry said that as a first step Palestinian negotiator Saeb Erakat and his Israeli counterpart Tzipi Livni would meet him in Washington "to begin initial talks within the next week or so".

The last round of direct talks broke down in 2010 over the issue of Israeli settlements in the West Bank and east Jerusalem. The issue of continued expansion of Jewish settlements remains one of the biggest stumbling blocks between the two sides.

On Saturday, Israeli Intelligence Minister Yuval Steinitz said his government would engage in the staged release of a "limited number" of prisoners, some of whom have been in Israeli jails for 30 years.

Steinitz provided no other details but said "there will definitely be a certain gesture here".

Kerry's announcement came after he spent four days consulting the Israeli and Palestinian leadership from his base in an Amman hotel and a late Friday helicopter dash to the Palestinian Authority in Ramallah.

Just minutes before boarding a plane to fly home, Kerry told reporters both sides had reached "an agreement that establishes a basis for resuming direct final status negotiations".

"This is a significant and welcome step forward," he added, having doggedly pushed the two sides to agree to resume talks in six intense trips to the region since becoming the top US diplomat in February.

But he warned that the issues separating the sides were "difficult" and "complicated".

A US State Department official said Kerry had wrenched a commitment from both sides "on the core elements that will allow direct talks to begin".

The Israelis and Palestinians remain far apart on final status issues including the borders of a future Palestinian state, the right of return of Palestinian refugees, and the fate of Jerusalem which both want as their capital.

Palestinian president Mahmud Abbas has also repeatedly called for a freeze to Israeli settlement building and a release of prisoners.

Analysts cautioned against reading too much into the latest developments.

Chico Menashe, diplomatic commentator for Israeli public radio, likened the situation to "a half-baked cake Kerry removed from the stove. Kerry convinced the Israelis and Palestinians it was edible, and both sides agreed to eat it."

Gal Berger, Palestinian affairs correspondent for Israel's public radio pointed to the fact that Yitzhak Molcho, the personal envoy of Prime Minister Benjamin Netanyahu, has already been holding talks with Erakat, which were still ongoing.

"Now Livni is being added, but it is still not a meeting at the level of the leaders (Netanyahu and Abbas)," he said.

Predictably, the Islamist Hamas movement which runs the Gaza Strip rejected a return to talks, its spokesman Sami Abu Zuhri saying Abbas had no legitimate right to negotiate on behalf of the Palestinian people.

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Court convicts five over Costa Concordia

AN Italian judge has accepted plea bargain agreements for four Costa Concordia crew members and a manager from owners Costa Crociere, in the first legal punishments for last year's shipwreck.

Deputy commander Ciro Ambrosio, third officer Silvia Coronica, helmsman Jacob Rusli Bin, cabin service manager Manrico Giampiedroni and Costa Crociere crisis co-ordinator Roberto Ferrarini were indicted for manslaughter and causing serious injuries.

Ferrarini, who had been accused of delaying rescue operations in a bid to minimise damage to the company's reputation, was handed a 34-month jail term, the longest sentence.

Giampiedroni was given a 30-month term.

Ambrosio, Coronica and Indonesia-born Rusli Bin - who allegedly failed to understand orders from captain Francesco Schettino - had also been indicted for causing a shipwreck.

They were handed jail terms of 23, 18 and 20 months respectively.

In a plea bargain, defendants admit their guilt in return for lowered punishments whose length is usually agreed on by the prosecution and defence, and approved by a judge. They thus avoid facing trial.

Saturday's decision left Schettino as the sole defendant in court proceedings that started this week in Grosseto, central Italy.

He faces multiple charges including manslaughter, shipwreck and abandoning his vessel.

Prosecutors say he could face up to 20 years in jail.

Schettino's lawyers argue that the captain - who was portrayed as a coward by international media after it emerged that he had abandoned the ship before all the passengers had been evacuated - is being made a scapegoat.

They claim that other people's blunders and security shortcomings on the Concordia are being overlooked.

This week, the lawyers renewed calls for Schettino to also be granted a plea bargain, suggesting a jail term of three years and five months, but prosecutors opposed the bid.

The Concordia hit a reef and ran aground off the island of Giglio on January 13, 2012, after it was steered dangerously close to the coast, killing 32 of its 4229 passengers.

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UK police find evidence of mosque blast

BRITISH counter-terrorism police say they had found evidence of a three-week-old explosion outside a mosque in central England, one of a spate of similar attacks in recent months.

The Wolverhampton central mosque was evacuated on Thursday night following the arrest of two Ukrainian men suspected of involvement in explosions at two other mosques in the area.

Police said debris from an explosion was found on a roundabout, and early indications suggested it had blown up on June 28.

"The debris... has been declared safe and further detailed forensic inquiries will be conducted at the scene throughout the day," the force said in a statement.

The find comes after two Ukrainian men aged 22 and 25 were arrested on Thursday as part of an investigation into explosions near mosques in the nearby towns of Tipton and Walsall.

They were arrested on suspicion of being involved in the commission, preparation or instigation of an act of terrorism.

There has been a rise in anti-Muslim incidents in Britain since May, when a soldier was hacked to death on a London street in a suspected Islamist attack.

The explosion at the mosque in Tipton on July 12 coincided with the funeral of 25-year-old Lee Rigby, who was murdered in broad daylight near his barracks in Woolwich, southeast London.

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McCartney joins stars' lobby for elephant

BRITISH pop music icon Sir Paul McCartney has joined international animal rights activists in calling for the transfer of a 39-year-old elephant from a Philippine zoo to a sanctuary in Thailand.

McCartney urged President Benigno Aquino III to set the creature, named Mali, free from Manila Zoo and allow her to live with other elephants in a sanctuary, more than one year after the president ordered a review of Mali's condition.

"With the stroke of a pen, you can bring an end to her suffering, and I urge you, with all my heart, to direct that Mali be given that joy now," he said in a letter to Aquino.

Other celebrities who have written to Aquino about Mali include British singer Morrissey and sultry Hollywood actress Pamela Anderson, who even invited the bachelor president on a date so they could talk about the welfare of the elephant.

Mali, the only elephant at the 5.5-hectare Manila Zoo, was donated by Sri Lanka in 1977.

Campaign group People for the Ethical Treatment of Animals has been calling for Mali's transfer, recruiting stars to back its claims that the elephant's enclosure is cramped and lacks room for Mali to roam around properly.

Female elephants are social animals in the wild.

Zoo officials have replied that Mali is in a good condition and is well taken care of, with space to move including a pool.

Manila City Mayor Joseph Estrada, a former Philippine president, said the city government plans to acquire two more elephants from Sri Lanka to be with Mali as part of a 2-billion-peso ($A50.90 million) renovation plan for the zoo.

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Bomb kills woman, children in Taliban home

A BOMB has killed five young children and a woman when it exploded after being made at the home of a Taliban commander in eastern Afghanistan, a government official says.

The device detonated on Thursday while children were playing with it after the Taliban commander, identified only as Abdullah, left the house, a spokesman for the local government in Paktika province said on Friday.

"Yesterday morning a Taliban commander, Abdullah, was making a bomb in his home to plant along the road and kill Afghan forces," spokesman Mokhlis Afghan told AFP.

"After a while, Abdullah left home, and the children came and played with the mine, and it detonated inside the house."

He said a woman and five children, aged three to seven, were killed.

Roadside bombs are the weapon of choice for Taliban insurgents fighting against Afghan government troops and their NATO military allies.

But civilians and children are also often killed and wounded by the attacks.

According to the United Nations, civilian deaths rose by 24 per cent in the first half of 2013.

It registered 2499 civilian casualties between January and June, attributing 74 per cent to anti-government forces and nine per cent to pro-government forces.

Children accounted for 21 per cent of all civilians killed and wounded, and casualties caused by roadside bombs had risen 41 per cent, it said.

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EU 'concerned' about Navalny jailing

THE European Union has condemned the verdict against Russian protest leader Alexei Navalny, saying the embezzlement charges were unsubstantiated and that his jailing posed "serious questions" about the rule of law in Russia.

A spokesperson for the EU's top diplomat, Catherine Ashton, said she was "concerned about the guilty verdict and the prison sentences handed down today by the Kirov Court" against Navalny and co-defendant Pyotr Ofitserov.

The German government's co-ordinator on Russia, Andreas Schockenhoff, told German public radio that the proceedings against Navalny were intended to neutralise him as a threat with "repressive measures".

"The Navalny case stands for policies that tolerate no forms of opposition or political competition," Schockenhoff said after the verdict, calling his prosecution a "show trial".

Schockenhoff, a politician and the point man on Russia at the German foreign ministry since 2006, said he had serious doubts about the independence of the Russian judiciary.

The United States ambassador to Moscow, Michael McFaul, said in a Twit said in a Twitter message: "We are deeply disappointed in the conviction of Navalny and the apparent political motivations in this trial."

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Monsanto drops bid to grow GM foods in EU

US agro-chemicals giant Monsanto won't request to grow new genetically modified foods in the EU. Source: AAP

US agro-chemicals giant Monsanto says it will drop all requests to be allowed to grow new genetically modified foods in the European Union, which has for years held up approval.

"We will no longer be pursuing approvals for cultivation of new biotech crops in Europe," Monsanto said on Thursday, adding that it would now focus on its conventional seeds business and enabling imports of such products into the region.

The European Commission, the EU's executive arm, said it "took note of the decision" by Monsanto which produces a whole stable of GM crops and associated agro-chemicals in wide use in the United States and elsewhere.

In Europe, however, there is widespread suspicion about the use of GM food products, with many fearing that their use could have an unintended long-term impact on health.

Monsanto and other producers insist such fears are unfounded and that GM products are essential if growing global demand for food is to be met.

The EU allows only two GM products to be grown in the 28-member bloc - Monsanto's MON 810 maize and German conglomerate BASF's Amflora potato.

Brussels cleared MON 810 in 1998 for 10 years and Monsanto submitted a request in 2007 for it to be extended but the process has been effectively frozen since then.

Environmental groups welcomed Monsanto's announcement.

"This is great news for science and research in Europe," said Mark Breddy, Greenpeace EU spokesman.

"Over the last couple of decades, GM crops have proven themselves to be an ineffective and unpopular technology, with unacceptable risks for our environment and health," Breddy said.

"Monsanto's retreat could finally create the space for European farming to focus on modern practices and technologies that offer real advances for food production and rural communities."

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Navalny: ambitious crusader against Putin

Russia's protest leader Alexei Navalny has been sentenced to five years in a prison colony. Source: AAP

RUSSIA'S charismatic protest leader Alexei Navalny, sentenced to five years in a prison colony, has galvanised the opposition with lacerating attacks on President Vladimir Putin and the Russian elite.

Navalny is a new breed of Russian protest leader who wants to become a player in mainstream politics after building up a huge internet following with sharply written blogs and corruption exposes.

He emerged as the key figure in the mass opposition protests that rocked Russia in the winter of 2011-2012 ahead of Putin's return for a third Kremlin term last May.

But his sentence on Thursday in a controversial embezzlement case, which supporters denounced as ordered by the Kremlin to eliminate a dangerous foe, will disqualify him from taking part in politics.

His sometimes volcanic rhetoric inspired supporters in a way never seen before in post-Soviet Russia, provocatively declaring at a rally in December 2011 that he could muster enough protesters to take the Kremlin.

He has boldly stated an ambition to become president in 2018 polls and "change the country" and also registered to run for mayor of Moscow in September elections.

But both ambitions will be in tatters if the verdict is confirmed on appeal.

Twice jailed briefly for administrative offences during the protests, he is no stranger to tough street talk and told a policeman who roughly arrested him last May that he would prosecute him afterwards.

Navalny has vowed that should he win power he will put in prison his enemies, a pledge that has troubled some liberals who fear a cycle of revenge justice.

"I am sure that sooner or later I will have them jailed," he told Moscow Echo radio in an interview ahead of the verdict hearing.

Since Putin's return for a third presidential term, Navalny has toned down his role in mass rallies and has turned his focus on exposing sleaze among top lawmakers in the ruling United Russia party.

Defiant to the last, just days before the verdict he published a detailed report accusing one of Putin's closest confidants, the head of Russian Railways Vladimir Yakunin, of possessing a vast undeclared business and property portfolio.

It was Navalny who dreamt up the infectious slogan calling United Russia "the party of swindlers and thieves", which it has not managed to shake off.

But held back by the lack of coverage on state television, he has yet to make an impact in the regions beyond his Moscow powerbase and many Russians have no clue who he is.

Even in the Russian capital, just eight per cent said they would vote for him in the mayoral elections and just 32 per cent were even aware of his candidacy.

Navalny, 37, began his anti-corruption crusade in 2007, buying up shares in state-controlled companies and grilling management at their annual general meetings.

Realising the power of the internet well before the Russian elite, he published reports alleging corruption and mass embezzlement at giant enterprises on his Rospil website (Rospil.info), which built up a loyal following.

In his last Live Journal blog post before the verdict, he called on Russians to keep up the fight.

"Simply understand this: there's no one else but you," he wrote. "If you are reading this, then you are the resistance."

Navalny makes astute use of the colloquial forms of the Russian language - where plays on words are hugely popular - in a way never dreamt of by any Kremlin official.

Seeking to present himself as an ordinary guy, Navalny lives with his wife Yulia - who has become an increasingly visible presence at his side - in a humdrum and otherwise unremarkable Moscow suburb called Maryino.

"Navalny is someone like you - he is not someone backed by oligarchs and bureaucrats," says his campaign literature for the mayoral elections. "Let's change Russia, starting with Moscow."

Nevertheless, his views on ethnic relations trouble liberals, in particular in such a multi-cultural country like Russia which is home to an estimated 20 million Muslims.

He coined the slogan "it's time to stop feeding" Russia's volatile North Caucasus and has spoken at the ultra-right Russian Marches, behaviour that earlier led to his expulsion from the liberal Yabloko party.

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Koreas fail to agree on industrial site

NORTH and South Korea have failed again to reach agreement on reopening their jointly-run industrial estate as they wrangled over who was to blame for its shutdown.

A fourth round of talks about the complex ended on Wednesday without agreement, but the two sides will meet again next Monday, said Seoul's chief delegate Kim Ki-Woong.

The Kaesong estate in North Korea, the last remaining symbol of cross-border co-operation, shut down in April as military tensions mounted after the North's February nuclear test and South Korean-US war games.

Dialogue resumed in recent weeks but little progress has been made amid squabbles over which side should take responsibility for the suspension of business there.

Wednesday's discussions appeared to be a repeat of previous rounds, with each side refusing to budge on conditions for resuming operations at the estate, built after a landmark inter-Korean summit in 2000.

The South urged the North to promise not to cause another closure and to take a respectful and constructive position to resolve the issue, according to an official with Seoul's unification ministry.

However, the North reiterated its previous position that operations at the zone should be normalised as soon as possible, the official said.

"There was a big difference" over how to work out a legal framework to prevent a future shutdown, Kim told reporters at the end of Wednesday's talks.

Kaesong was previously a valuable source of hard currency for the impoverished North.

At a meeting earlier this month, the two sides agreed in principle to reopen the estate, where 53,000 North Koreans worked in 123 South-owned factories producing textiles or light industrial goods.

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FBT changes dominate climate debate

Labor minister Mark Butler (C) says legislation will be drafted for the ETS before the election. Source: AAP

LABOR'S crackdown on work-related benefits to help pay for a shift to an emissions trading scheme (ETS) continues to anger the motor industry after the government said it would mainly impact luxury car owners.

Changes to fringe benefit tax (FBT) arrangements on car leasing and salary sacrifice packaging aim to raise $1.8 billion of the $3.8 billion needed for an early shift from a fixed carbon pricing regime to an ETS in 2014.

The move, which will impact about 320,000 people, has angered automotive groups and the opposition, but the government is determined to push through the measure, even if it means recalling parliament.

"In the event that parliament were to resume before the election, I could take draft legislation to the parliament," Climate Change Minister Mark Butler said on Wednesday.

If rejected, Labor would take it to the election and seek a mandate from voters, he added.

Shadow treasurer Joe Hockey said the surprise change was like taking a baseball bat to an already ailing motor vehicle industry.

"This is poorly thought out, there was no consultation with any stakeholders," he told reporters after meeting with car salesmen in western Sydney.

However, Mr Hockey stopped short of committing the coalition to block the measure, saying "we would not start from yesterday" when asked if he would back the change.

The senior Liberal agreed with car retailers who say they rely on the FBT scheme to keep up sales in an already cut-throat sector.

But Deputy Prime Minister Anthony Albanese said people were "fiddling the system" by buying expensive luxury cars and claiming personal travel as a work-related expense.

"The chances are it's not a Holden Commodore, it's a BMW," he said.

Treasurer Chris Bowen tried to soften the blow, adding that people entitled to dispensation would still be able to get it as long as they could justify their claims.

"If you are not using your car for business, then you don't need a business-use deduction," he said.

The savings from the FBT measure form the single biggest plank of Labor's push to an ETS next year, and neutralise lingering voter antipathy toward imposition of the $24 a tonne carbon tax.

Other savings will come from public service job cuts and the scrapping or winding back of some clean energy programs.

Prime Minister Kevin Rudd says the ETS push is in line with a promise he made to Australians in 2007 during his first leadership term, and will save the average Australian household $380 in 2014/15.

But industry says changes to the FBT scheme will hit middle-income earners hardest.

"Motorists ... should not be targeted to help minimise the budget impact of other policy decisions," Australian Automobile Association director Andrew McKellar said.

The Australian Greens, who are critical of cuts to environmental programs, are promising to stall any government legislation related to the earlier ETS move in the upper house.

"We won't be moving to the ETS in 2014," said Greens leader Christine Milne.

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Rudd close to boat policy announcement

THE Rudd government is closer to laying out changes to its strategy on asylum seeker boat arrivals as Opposition Leader Tony Abbott declared Australia was facing a national emergency.

After moving to neutralise the carbon tax as an election issue by "terminating" it on Tuesday, federal Labor now plans to address its biggest policy weakness.

Prime Minister Kevin Rudd on Wednesday outlined his three-pronged approach to the vexed policy area covering action at the global, regional and national level.

"That's the correct response to a problem which is not uniquely Australia's - it is a problem right around the world," he told reporters in Gladstone.

The prime minister's comments came as a search and rescue operation began off Christmas Island after an asylum seeker boat carrying 80 people issued a distress call.

It also came a day after four people died when a boat capsized while under the escort of two navy vessels en route to Christmas Island.

The bodies of two men and two women, all thought to be in their 20s and 30s, were recovered from the water and a further 144 people were rescued.

Last weekend a baby boy, who was on a vessel swamped by high seas as it struggled toward the Australian coastline, was drowned.

Mr Rudd indicated Labor was looking at the effectiveness of the United Nations Refugee Convention.

While there's no suggestion Australia will withdraw from the convention, his comments imply the government might push for the 60-year-old agreement to be changed to reflect current movements of displaced people.

This could make it easier for Australia to reject refugee applications for people it deems to be economic migrants and not persons fleeing persecution or war.

Foreign Minister Bob Carr has already expressed concerns there were more economic migrants, particularly from Iran, coming to Australia on boats provided by people smugglers in Indonesia.

Iran currently refuses to accept people who don't want to be returned.

Mr Rudd, who recently visited Indonesia and Papua New Guinea, said on Wednesday he was looking at strengthening co-operation with nations in southeast Asia and the southwest Pacific.

The government was also looking at reforming Australia's domestic refugee determination process.

As part of the process, the foreign affairs department is updating advisory information provided to refugee tribunals and courts on asylum seeker source countries.

The government wants to change a review process that overturns the overwhelming majority of failed asylum seekers.

Home Affairs Minister Jason Clare has also called on all sides of politics to work together to "fix this God-awful problem".

"This is a wretchedly difficult area and it's been poisoned by politics," he said in Sydney.

Mr Abbott said he was more than happy to put partisanship aside and support Labor in making the changes needed to stop the boats.

"Bring back the parliament, let's debate this issue and let's make the changes now to stop the boats," he said in Mackay, Queensland.

"This is a national emergency, it's got to be addressed now."

Australia's border protection commander Rear Admiral David Johnston said his staff had suffered psychologically.

"It is a dreadful feeling in the stomach when we hear that a vessel has capsized or that it's in some difficulty," he told reporters.

Recently retired navy Lieutenant Commander Barry Learoyd, commander of the patrol boat HMAS Albany in the 2009 SIEV-36 incident when an intercepted vessel exploded with the loss of five asylum seekers, said boat turnbacks could be done.

"If the government says yes we are to turn the vessel around, then there would be procedures in place to make sure that happens as safely as we can," he told ABC television.

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Rudd plays up Qld support at cabinet meet

Kevin Rudd opened a public forum in Rockhampton by declaring support for the Maroons in the Origin. Source: AAP

KEVIN Rudd is a maroon-wearing, NRL loving, cockroach hating Queenslander.

And the prime minister made sure those attending a community cabinet in the rugby league mad town of Rockhampton in central Queensland on Tuesday night knew it.

Federal Labor is banking on Mr Rudd's popularity in his home state to help retain and even gain seats in Queensland in the upcoming election.

Mr Rudd opened the public forum, in the marginal seat of Capricornia, by declaring his support for the Maroons against the NSW Blues in the State of Origin rugby league decider on Wednesday night.

"With deference to my colleagues south of the border, it's great to be back to Queensland during State of Origin week," he said to applause.

He also joked police would take the names of those in the crowd who identified themselves as Blues supporters.

The prime minister then threw his weight behind the push for a central Queensland NRL team by announcing $500,000 to help a bid consortium work towards a new stadium for Rockhampton.

The stadium will be essential for the region's success.

While the announcement was well received, Mr Rudd did have his detractors, including a mishmash of protesters outside the gates. Activists calling for action on everything ranging from the Great Barrier Reef, live exports and Guantanamo Bay chanted outside the gates of North Rockhampton High School.

Inside the crowd was just as fiery at points, with questions including topics on education reform, disability services, carbon pricing and asylum seekers.

An indigenous attendee scalded Mr Rudd and his ministers for not acknowledging the traditional owners of the region before they each spoke.

Mr Rudd was not impressed.

"Can I just say in response to that mate, we had an official welcome to country and as the bloke who delivered the national apology to all indigenous Australians, I honour all first Australians wherever I go," he said.

"OK mate, why don't we get to the question?" Surprisingly, no one asked about agriculture or cattle, which are big industries in the region.

Mr Rudd will continue his blitz along Queensland's coast on Wednesday in Gladstone after he spent the morning in Townsville.

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McDonald's to open in Vietnam

MCDONALD'S says it will launch its first restaurant in communist Vietnam next year after granting a franchise to the son-in-law of Prime Minister Nguyen Tan Dung.

The American fast food giant said on Tuesday it planned to open in the southern business hub Ho Chi Minh City in early 2014 after making businessman Henry Nguyen its "developmental licensee".

"As we grow our presence in the Asia region, we are looking for partners with a blend of strong business acumen and a unique understanding of our brand," said Dave Hoffmann, president of McDonald's Asia Pacific, Middle East and Africa region.

The son-in-law, also known as Nguyen Bao Hoang, flipped burgers for McDonald's while growing up in America - where his family fled in 1975 at the end of the US-Vietnam war - but returned to his native country over a decade ago and now works at IDG Ventures Vietnam, a venture capital group.

"I have dreamed of one day opening a McDonald's restaurant in my native country ever since my return to Vietnam more than a decade ago," Henry Nguyen said in a statement.

Fast food giants such as KFC, Burger King, Subway and Pizza Hut already have restaurants in Vietnam alongside dozens of local chains.

In February Starbucks opened its first store in Ho Chi Minh City. It has proved highly popular with young Vietnamese who form long queues to get Western-style lattes and frappes.

The entry of McDonald's into the Vietnamese market highlights the attractiveness of the roughly 90 million population and rapidly expanding middle class, despite the country's current economic slowdown and lingering banking crisis.

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Hong Kong shares end flat

HONG Kong shares ended flat on Tuesday as another record close on Wall Street was offset by profit-taking following a rally in the previous session.

Hong Kong's benchmark Hang Seng Index edged up 9.07 points to 21,312.38 on turnover of $HK48.45 billion ($A6.89 billion).

GCL-Poly rose 6.7 per cent to $HK1.92, while Comtec Solar rallied 4.6 per cent to $HK2.04, closing near a two-year high.

Shares of gaming company NetDragon dropped 21 per cent to $HK19.04 after the company said it will sell Chinese app store operator 91 Wireless to search engine giant Baidu.

Chinese shares closed up 0.31 per cent. The benchmark Shanghai Composite Index rose 6.33 points to 2,065.72 on turnover of 82.87 billion yuan ($A14.89 billion).

"We expect the market to consolidate in the near term after a slew of economic data confirmed that growth momentum remains weak," Capital Securities analyst Jacky Zhang told Dow Jones Newswires.

Solar firms rose after the government set a larger target for expansion of China's solar power capacity.

TDG Holding rose by its 10 per cent daily limit to 5.58 yuan and Lida Optical & Electronic also advanced 10 per cent to 7.11 yuan.

AVIC Heavy Machinery jumped 7.83 per cent to 15.42 yuan and Sichuan Chengfa Aero Science & Technology rose 3.86 per cent to 11.04 yuan.

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Hong Kong shares end 0.12% higher

HONG Kong and Shanghai stocks rose on Monday after Chinese economic growth data for the April-June quarter came in as forecast.

Hong Kong's benchmark Hang Seng Index added 0.12 per cent, or 26.03 points, to 21,303.31 on turnover of HK$45.98 billion ($A6.57 billion).

Beijing's statistics office said gross domestic product (GDP) grew 7.5 per cent year-on-year in the second quarter, in line with a median forecast by economists questioned by AFP.

While the figures show second consecutive slowdown, investors were pleased it was not worse than expected.

Brokerages rallied, with Shenyin Wanguo closing up 2.8 per cent at $HK2.60 while China Galaxy rose 1.5 per cent to $HK4.83.

But utilities declined, with Hong Kong & China Gas falling 1.3 per cent to $HK19.40 and Power Assets declined 0.8 per cent to $HK68.65.

Chinese shares closed up 0.98 per cent. The Shanghai Composite Index rose 19.90 points to 2,059.39 on turnover of 88.0 billion yuan ($A15.83 billion).

"The GDP number pretty much confirmed what investors had expected, that China's economy is slowing down," Changjiang Securities analyst Wu Bangdong told Dow Jones Newswires.

"But investors still hope that there might be some supportive policies."

Financial stocks led the gains. China Citic Bank rose 4.27 per cent to 3.91 yuan and Haitong Securities advanced 3.98 per cent to 10.98 yuan.

Media and entertainment shares rose on bargain hunting. Zhejiang Daily Media Group jumped 6.25 per cent to 28.03 yuan while Chinese Universe Publishing and Media gained 3.30 per cent to 19.08 yuan.

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France vows to punish Mali hostage killers

A body found in northern Mali may be that of Philippe Verdon (R) kidnapped by al-Qaeda in 2011. Source: AAP

FRENCH President Francois Hollande says there is a "very strong" chance that a body found in northern Mali is that of a French hostage and vowed the killing would not go unpunished.

Philippe Verdon, who was kidnapped by al-Qaeda in the Islamic Maghreb (AQIM) from a hotel while on business in northeastern Mali in November 2011, was already believed to be dead.

His captors announced in March that the 53-year-old had been executed in response to France's military intervention in Mali.

"We found a body 10 days ago in northern Mali, we are doing everything possible to confirm that this could be, alas, the body of Philippe Verdon," Hollande said at Mali's embassy to Paris, where he was awarded the highest rank in the country's National Order on Monday.

"We will then determine the cause of death and nothing will go unpunished," Hollande said.

AQIM is holding hostage eight Europeans, including five French nationals.

French forces intervened in Mali in January to help the weak Malian military drive out Islamist rebels who had seized control of the country's north.

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Thousands protest over Zimmerman verdict

Protests have been held in US cities after a jury found George Zimmerman not guilty of murder. Source: AAP

THOUSANDS have protested in US cities as President Barack Obama appealed for calm following the acquittal in Florida of a man who gunned down an unarmed black teenager.

The angry protests highlight simmering racial tensions after a jury found volunteer watchman George Zimmerman not guilty of murdering 17-year-old Trayvon Martin.

Demonstrators held noisy rallies in US cities including New York, San Francisco, Boston, Detroit and Chicago.

At least six people were arrested in Los Angeles early on Monday when riot police broke up an "unlawful assembly" in Hollywood near the CNN building.

To the chants of "No justice, no peace!" a separate crowd blocked traffic on an important freeway elsewhere in the giant metropolis, local media reported.

The most numerous rally on Sunday was in New York City, where several thousand - including families with children - marched to Times Square under the watchful eye of police.

Many in the multi-racial crowd brandished signs bearing a portrait of Martin, while some, despite sweltering July heat, wore "hoodie" sweatshirts as the teen did the night he was killed.

"I am appalled," said Carli VanVoorhis, a 21-year-old hairdresser.

"The man was armed, the kid was not, and the man with the gun got away," she said.

"If we say it was not a racial issue, we would be lying."

"We have a big problem with race, and another problem is guns," said protester Rodney Rodriguez. "If Zimmerman didn't have a gun, he couldn't have killed Trayvon Martin."

The case has pitted those who believe that Zimmerman, a 29-year-old Hispanic neighbourhood watchman, killed Martin in self-defence, and those who believe it was a murder sparked by racist assumptions.

Obama, the first black US president, urged Americans to step back and accept the trial verdict.

"We are a nation of laws, and a jury has spoken," he said in a statement.

"I now ask every American to respect the call for calm reflection from two parents who lost their young son."

Zimmerman was accused of pursuing Martin through a gated community in the town of Sanford and shooting him during an altercation on the rainy night of February 26, 2012.

The defence successfully argued that Zimmerman fired his handgun in self-defence after the teen wrestled him to the ground and was slamming his head against the pavement.

According to Florida's controversial "Stand Your Ground" law, people who fear for their lives can use deadly force to defend themselves without having to flee a confrontation.

"We should ask ourselves, as individuals and as a society, how we can prevent future tragedies like this," Obama said. "As citizens, that's a job for all of us. That's the way to honour Trayvon Martin."

Obama last year spoke emotionally about the case, noting that if he had a son he would "look like Trayvon."

The racial divide was evident in Sanford pastor Valerie Houston's Sunday sermon.

"Dr (Martin Luther) King (Jr) stated, the daily life of the Negro is still in the basement of the Great Society," she said.

"And today I state, the daily life of my people is still enslaved to a white supremacist society."

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