U.N. set for implicit recognition of Palestinian state, despite U.S., Israel threats

UNITED NATIONS (Reuters) - The U.N. General Assembly is set to implicitly recognize a sovereign state of Palestine on Thursday despite threats by the United States and Israel to punish the Palestinian Authority by withholding much-needed funds for the West Bank government.

A resolution that would change the Palestinian Authority's U.N. observer status from "entity" to "non-member state," like the Vatican, is expected to pass easily in the 193-nation General Assembly.

Israel, the United States and a handful of other members are planning to vote against what they see as a largely symbolic and counterproductive move by the Palestinians, which takes place on the 65th anniversary of the assembly's adoption of resolution 181 on the partition of Palestine into Jewish and Arab states.

Palestinian President Mahmoud Abbas has been leading the campaign to win support for the resolution, and over a dozen European governments have offered him their support after an eight-day conflict this month between Israel and Islamists in the Gaza Strip, who are pledged to Israel's destruction and oppose his efforts toward a negotiated peace.

The U.S. State Department said on Wednesday that Deputy Secretary of State Bill Burns and U.S. Middle East peace envoy David Hale traveled to New York on Wednesday in a last-ditch effort to get Abbas to reconsider.

The Palestinians gave no sign they were turning back.

Secretary of State Hillary Clinton repeated to reporters in Washington on Wednesday the U.S. view that the Palestinian move was misguided and efforts should focus instead on reviving the stalled Middle East peace process.

"The path to a two-state solution that fulfills the aspirations of the Palestinian people is through Jerusalem and Ramallah, not New York," she said. "The only way to get a lasting solution is to commence direct negotiations."

State Department spokeswoman Victoria Nuland reiterated U.S. warnings that the move could cause a reduction of U.S. economic support for the Palestinians. The Israelis have also warned they might take significant deductions out of monthly transfers of duties that Israel collects on the Palestinians' behalf.

Despite its fierce opposition, Israel seems concerned not to find itself diplomatically isolated. It has recently toned down threats of retaliation in the face of wide international support for the initiative, notably among its European allies.

"The decision at the United Nations will change nothing on the ground," Israeli Prime Minister Benjamin Netanyahu said in Jerusalem. "It will not advance the establishment of a Palestinian state. It will delay it further."

'SLAP IN THE FACE'

Granting Palestinians the title of "non-member observer state" falls short of full U.N. membership - something the Palestinians failed to achieve last year. But it would allow them access to the International Criminal Court and some other international bodies, should they choose to join them.

Hanan Ashrawi, a top Palestinian Liberation Organization official, told a news conference in Ramallah that "the Palestinians can't be blackmailed all the time with money."

"If Israel wants to destabilize the whole region, it can," she said. "We are talking to the Arab world about their support, if Israel responds with financial measures, and the EU has indicated they will not stop their support to us."

Peace talks have been stalled for two years, mainly over the issue of Israeli settlements in the West Bank, which have expanded despite being deemed illegal by most of the world.

In the draft resolution, the Palestinians have pledged to relaunch the peace process immediately following the U.N. vote.

As there is little doubt about how the United States will vote when the Palestinian resolution to upgrade its U.N. status is put to a vote sometime after 3 p.m. (2000 GMT) on Thursday, the Palestinian Authority has been concentrating its efforts on lobbying wealthy European states, diplomats say.

With strong support from the developing world that makes up the majority of U.N. members, the resolution is virtually assured of securing more than the requisite simple majority. Palestinian officials hope for more than 130 yes votes.

Abbas has been trying to amass as many European votes in favor as possible.

Austria, Denmark, Norway, Finland, France, Greece, Iceland, Ireland, Luxembourg, Malta, Portugal, Spain, Sweden and Switzerland all pledged to support the Palestinian resolution. Britain said it was prepared to vote yes, but only if the Palestinians fulfilled certain conditions.

Diplomats said the Czech Republic was expected to vote against the move, potentially dashing European hopes to avoid a three-way split in the vote. Germany and the Netherlands said they planned to abstain, like Estonia and Lithuania.

Ashrawi said the positive responses from European states were encouraging and sent a message of hope to all Palestinians.

"This constitutes a historical turning point and opportunity for the world to rectify a grave historical injustice that the Palestinians have undergone since the creation of the state of Israel in 1948," she said.

A strong backing from European nations could make it awkward for Israel to implement harsh retaliatory measures. But Israel's reaction might not be so measured if the Palestinians seek ICC action against Israel on charges of war crimes, crimes against humanity or other crimes the court would have jurisdiction over.

Israel also seems wary of weakening the Western-backed Abbas, especially after the political boost rival Hamas received from recent solidarity visits to Gaza by top officials from Egypt, Qatar and Tunisia.

Hamas militants, who control Gaza and have had icy relations with the Palestinian Authority in the West Bank, unexpectedly offered Abbas their support this week.

One Western diplomat said the Palestinian move was almost an insult to recently re-elected U.S. President Barack Obama.

"It's not the best way to convince Mr. Obama to have a more positive approach toward the peace process," said the diplomat, who was planning to vote for the resolution. "Three weeks after his election, it's basically a slap in the face."

(Andrew Quinn in Washington, Noah Browning in Ramallah, Jeffrey Heller in Jerusalem, Michelle Nichols in New York, and Reuters bureaux in Europe and elsewhere; Editing by Peter Cooney and Xavier Briand)

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Lindsay Lohan Arrested for Alleged Assault in Club

Update

By Stephen M. Silverman

UPDATED
11/29/2012 at 08:00 AM EST

• Originally published 11/29/2012 at 06:55 AM EST

Lindsay Lohan leaves the police precinct station in New York City

INF; Inset: Paul Morigi/WireImage

Lindsay Lohan was arrested and charged with third-degree assault at 4 a.m. Thursday in Manhattan' s Meatpacking District after an alleged altercation with a woman in a nightclub.

Det. Mark Nell of the NYPD told PEOPLE: "This morning at 4 a dispute broke out at Avenue located at 116 10th Avenue. A female 26-year-old assaulted a female 28-year old. Lindsay Lohan was arrested and charged with assault."

Asked what happened, Nell said, "She punched her in the face."

By 8 a.m., Nell said, Lohan "has now left the precinct and was given a desk appearance at a later date."

TMZ reports that Lohan, after telling the woman to give her some space, or words to the effect, reputedly punched the woman in the face.

New York's Daily News names the other woman as Tiffany Eve Mitchell, of West Palm Beach, Fla, who was at Avenue with her husband.

The paper also says she and Lohan were sitting in separate VIP sections when a scuffle erupted elsewhere in the club, and Mitchell possibly bumped into Lohan in order to avoid getting involved.

The other woman was not arrested or injured, according to WNBC News.

The alleged other woman, leaving the 10th Precinct

Splash News Online

There has been no comment from Lohan's publicist, but the New York Post quotes Lohan assistant Gavin Doyle, who apparently was at the club, as saying about the actress, "It's become a pastime to use her name and fame and blame things on her."

The Post also quotes a man believed to be Mitchell's husband. He reportedly said, "Lindsay Lohan got drunk and went crazy ... hit my wife."

Lohan currently is on informal probation for removing a necklace from a California jewelry store last year, and could face potential jail time if she is re-arrested.

• With reporting by LIZ McNEIL

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Simple measures cut infections caught in hospitals

CHICAGO (AP) — Preventing surgery-linked infections is a major concern for hospitals and it turns out some simple measures can make a big difference.

A project at seven big hospitals reduced infections after colorectal surgeries by nearly one-third. It prevented an estimated 135 infections, saving almost $4 million, the Joint Commission hospital regulating group and the American College of Surgeons announced Wednesday. The two groups directed the 2 1/2-year project.

Solutions included having patients shower with special germ-fighting soap before surgery, and having surgery teams change gowns, gloves and instruments during operations to prevent spreading germs picked up during the procedures.

Some hospitals used special wound-protecting devices on surgery openings to keep intestine germs from reaching the skin.

The average rate of infections linked with colorectal operations at the seven hospitals dropped from about 16 percent of patients during a 10-month phase when hospitals started adopting changes to almost 11 percent once all the changes had been made.

Hospital stays for patients who got infections dropped from an average of 15 days to 13 days, which helped cut costs.

"The improvements translate into safer patient care," said Dr. Mark Chassin, president of the Joint Commission. "Now it's our job to spread these effective interventions to all hospitals."

Almost 2 million health care-related infections occur each year nationwide; more than 90,000 of these are fatal.

Besides wanting to keep patients healthy, hospitals have a monetary incentive to prevent these infections. Medicare cuts payments to hospitals that have lots of certain health care-related infections, and those cuts are expected to increase under the new health care law.

The project involved surgeries for cancer and other colorectal problems. Infections linked with colorectal surgery are particularly common because intestinal tract bacteria are so abundant.

To succeed at reducing infection rates requires hospitals to commit to changing habits, "to really look in the mirror and identify these things," said Dr. Clifford Ko of the American College of Surgeons.

The hospitals involved were Cedars-Sinai Medical Center in Los Angeles; Cleveland Clinic in Ohio; Mayo Clinic-Rochester Methodist Hospital in Rochester, Minn.; North Shore-Long Island Jewish Health System in Great Neck, NY; Northwestern Memorial Hospital in Chicago; OSF Saint Francis Medical Center in Peoria, Ill.; and Stanford Hospital & Clinics in Palo Alto, Calif.

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Online:

Joint Commission: http://www.jointcommission.org

American College of Surgeons: http://www.facs.org

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AP Medical Writer Lindsey Tanner can be reached at http://www.twitter.com/LindseyTanner

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Stock futures hold gains after claims, GDP data

DEAR ABBY: My wife and I have been married for five years. I recently discovered that she made between 10 and 20 porn videos when she was 19. We got married when she was 27. We have four kids from two previous marriages.I am devastated. When I confronted her about it, she cried harder than I had ever seen. She said she was lost, and it's the biggest regret of her entire life.I understand how hard it can be to tell someone you have done something like this. I haven't led a perfect life either, and I have my own skeletons and things that I would never mention. But still, I can't get over this. ...

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Egypt protests continue in deadlock over Mursi powers

CAIRO (Reuters) - Hundreds of protesters were in Cairo's Tahrir Square for a sixth day on Wednesday, demanding that Egyptian President Mohamed Mursi rescind a decree they say gives him dictatorial powers.

Five months into the Islamist leader's term, and in scenes reminiscent of the popular uprising that unseated predecessor Hosni Mubarak last year, police fired teargas at stone-throwers following protests by tens of thousands on Tuesday against the declaration that expanded Mursi's powers and put his decisions beyond legal challenge.

Protesters say they will stay in Tahrir until the decree is withdrawn, bringing fresh turmoil to a nation at the heart of the Arab Spring and delivering a new blow to an economy already on the ropes.

Senior judges have been negotiating with Mursi about how to restrict his new powers, while protesters want him to dissolve an Islamist-dominated assembly that is drawing up a new constitution and which Mursi protected from legal review.

Any deal to calm the street will likely need to address both issues. But opposition politicians said the list of demands could grow the longer the crisis goes on. Many protesters want the cabinet, which meets on Wednesday, to be sacked, too.

Mursi's administration insists that his actions were aimed at breaking a political logjam to push Egypt more swiftly towards democracy, an assertion his opponents dismiss.

"The president wants to create a new dictatorship," said 38-year-old Mohamed Sayyed Ahmed, who has not had a job for two years. He is one of many in the square who are as angry over economic hardship as they are about Mursi's actions.

"We want the scrapping of the constitutional declaration and the constituent assembly, so a new one is created representing all the people and not just one section," he said.

The West worries about turbulence in a nation that has a peace treaty with Israel and is now ruled by Islamists they long kept at arms length. The United States, a big donor to Egypt's military, has called for "peaceful democratic dialogue".

Two people have been killed in violence since the decree, while low-level clashes between protesters and police have gone on for days near Tahrir. Violence has flared in other cities.

WRANGLES

Trying to ease tensions with judges, Mursi assured Egypt's highest judicial authority that elements of his decree giving his decisions immunity applied only to matters of "sovereign" importance, a compromise suggested by the judges in talks.

That should limit it to issues such as declaring war, but experts said there was much room for interpretation. The judges themselves are divided, and the broader judiciary has yet to back the compromise. Some have gone on strike over the decree.

The fate of the assembly drawing up the constitution has been at the centre of a wrangle between Islamists and their opponents for months. Many liberals, Christians and more moderate Muslims have walked out, saying their voices are not being heard in the body dominated by Islamists.

That has undermined the work of the assembly, which is tasked with shaping Egypt's new democracy. Without a constitution in place, the president's powers are not permanently defined and a new parliament cannot be elected.

For now, Mursi holds both executive and legislative powers. His decree says his decisions cannot be challenged until a new parliament is in place. An election is expected in early 2013.

"If Mursi doesn't respond to the people, they will raise their demands to his removal," said Bassem Kamel, a liberal and former member of the now dissolved parliament that was dominated by Mursi's party, a wing of the Muslim Brotherhood.

He said Tuesday's protest showed that Egyptians "understood that the Brotherhood isn't for democracy but uses it as a tool to reach power and then to get rid of it".

Protecting his decisions and the constituent assembly from legal review was a swipe at the judiciary, still largely unreformed since Mubarak's era. In a speech on Friday, Mursi praised the judiciary as a whole but referred to corrupt elements he aimed to weed out.

One presidential source said Mursi wanted to re-make the Supreme Constitutional Court, a body of top judges that earlier this year declared the Islamist-led parliament void, leading to its dissolution by the then ruling military.

Both Islamists and their opponents broadly agree that the judiciary needs reform, but Mursi's rivals oppose his methods.

The courts have dealt a series of blows to Mursi and the Brotherhood. The first constituent assembly, also packed with Islamists, was dissolved. An attempt by Mursi in October to remove the unpopular general prosecutor was also blocked.

In his decree, Mursi gave himself the power to sack the prosecutor general and appoint a new one, which he duly did.

(Additional reporting by Tamim Elyan; Writing by Edmund Blair; Editing by Will Waterman)

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U.S. for-profit colleges spend big on marketing while slashing other costs

(Reuters) – Google‘s biggest advertiser is neither a bank nor a retailer.

It’s the for-profit University of Phoenix, which has recently been spending nearly $ 400,000 a day on ads, more than any financial firm or retailer, the traditional big spenders on online advertising, according to search analytics firm SpyFu.

That kind of spending may seem surprising coming from a college, but marketing has become vital for the university and its for-profit rivals as enrollments plummet and they fight back against a host of criticisms, including low job-placement rates.

Colleges such as University of Phoenix, the industry leader owned by Apollo Group Inc, will not only have to boost enrollments to reverse their fortunes, analysts say. They will also need to consider cutting tuition fees as well as continue to slash costs and take market share from rivals.

“I have witnessed several versions of this cycle but none as extreme as this,” said Trace Urdan, an analyst with Wells Fargo Securities, who has been covering the U.S. for-profit education industry for about 15 years.

“We are going to see more pointed efforts at marketing and more price competition in an effort to try to capture more market share both from each other as well as from traditional schools,” Urdan said.

Operators of other for-profit colleges, whose ranks include the Washington Post Co’s Kaplan business, DeVry Inc and ITT Educational Services Inc, are also boosting their spending on marketing and are among the 25 biggest advertisers on Google.

But no one is spending like the University of Phoenix, which doubled its spending on Google ads to about $ 380,000 per day on average between October 12 and November 12, compared with $ 170,000 a day in the previous month, according to SpyFu.

Increased marketing alone will not be enough to fatten fast-shrinking profit margins and increase enrollments, however. Lower tuition fees and increased specialization of the type of programs offered, along with further streamlining of operations, will also be necessary, analysts say.

Industry bellwether University of Phoenix, which offers courses at about 230 campuses as well as online, announced plans last month to shut about half its locations and cut 800 jobs in order to save about $ 300 million a year by 2014.

New enrollments in the Apollo system are down nearly 50 percent in the past two years. As of August 31, enrollment totaled about 328,000.

Career Education Corp, which owns American InterContinental University and the Le Cordon Bleu colleges, and Lincoln Educational Services Corp have also announced closures.

LOW-COST MODEL

The $ 25 billion industry, which typically serves adults looking for a career change or a program to enhance job skills, is reeling after government investigations revealed fraud related to financial aid, worryingly high student debt loads and low rates of graduation and job placement.

“Many for-profit colleges make decisions that prioritize their bottom line, even when those decisions limit their students’ opportunities for academic success,” a U.S. Senate report said earlier this year.

Tuition fees, and therefore profits, is one area under pressure as potential students need to be convinced to take out loans in an uncertain job market.

Apollo, whose stock has lost about 65 percent of its value this year, implemented a tuition freeze earlier this year and promised students it will not increase prices through the course of their programs.

Apollo is also looking at different cost models, with a view to serving segments of the population that it cannot serve with current University of Phoenix tuition prices.

“We have certainly seen a lot more competition at the lower end of the price scale, and that’s something we are focusing on,” Apollo spokesman Mark Brennar said, while declining to offer specifics.

Wells Fargo’s Urdan said it is likely that Apollo wants to compete in the low-cost end of the market by building a second brand, which it would likely do by acquiring another college rather than starting from scratch.

As colleges lower their revenue base by cutting tuition fees even as they spend more on marketing, lower margins could become the norm, analysts say. That has spooked investors already worried about sliding enrollments.

The S&P 1500 Education Services index has lost three-quarters of its value since April 2010, including a 50 percent decline in 2012.

Some for-profit colleges already differentiate themselves in the crowded higher-education market by offering programs in a particular field or by targeting students of a particular background, and that trend could accelerate.

American Public Education, for example, is known for enrolling those who work in the military and public services, while Universal Technical Institute offers programs related to the automotive industry.

For-profit colleges play up their links to employers to attract students who may otherwise opt for traditional or community colleges, said Rob Lytle, head of the education practice at advisory firm Parthenon Group.

“They are about getting people workforce employability skills, and I think they are going to be focusing tighter on that,” said Lytle.

(Reporting by A. Ananthalakshmi in Bangalore; Editing by Ted Kerr)

Internet News Headlines – Yahoo! News

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Angus T. Jones's Video Surprises Two and a Half Men Set

By Mike Fleeman

11/28/2012 at 08:35 AM EST

After the Charlie Sheen tiger blood debacle, it would seem that nothing could shock the cast and crew of Two and a Half Men anymore.

Then came the Angus T. Jones video.

"This came as a surprise to most people. This isn't who he grew up as," a source on the show tells PEOPLE. "He's always been a good kid and he's very well-liked by everyone at the show."

The 19-year-old has blasted the CBS sitcom that pays him a reported $350,000 an episode, saying in a video posted on a religious website: "Please stop watching it. Please stop filling your head with filth."

The comments came during an apparent religious awakening for the actor in the Seventh-Day Adventist Church.

“We are happy that Angus has joined the Seventh-Day Adventist family and has found a place in which he feels comfortable to worship and grow his faith,” says George Johnson, a church spokesman. “Recently, Angus made some statements concerning his spiritual journey and expressed his views concerning the television program
Two and a Half Men.

"These comments are of a personal nature, reflecting his views after having undergone changes during his spiritual journey," Johnson continues. "We welcome him with open arms to the worldwide Seventh-Day Adventist Church family and are excited about his commitment to God through his recent baptism at his church."

Neither Jones nor reps for the show have spoken out.

The actor won't be on the set this week – which was previously planned because his character isn't involved in this episode.

"The cast was really surprised by the video," says a second source on set. "At first they didn't believe he'd say those things. ... He always has a great attitude, which is why everyone was surprised. He's friendly and talented and great at his job."

• Reporting by MONICA RIZZO, AILI NAHAS and MELODY CHIU

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CDC: HIV spread high in young gay males

NEW YORK (AP) — Health officials say 1 in 5 new HIV infections occur in a tiny segment of the population — young men who are gay or bisexual.

The government on Tuesday released new numbers that spotlight how the spread of the AIDS virus is heavily concentrated in young males who have sex with other males. Only about a quarter of new infections in the 13-to-24 age group are from injecting drugs or heterosexual sex.

The Centers for Disease Control and Prevention said blacks represented more than half of new infections in youths. The estimates are based on 2010 figures.

Overall, new U.S. HIV infections have held steady at around 50,000 annually. About 12,000 are in teens and young adults, and most youth with HIV haven't been tested.

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Online:

CDC report: http://www.cdc.gov/vitalsigns

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Stock futures off as investors worry about "fiscal cliff"

NEW YORK (Reuters) - Stock futures fell on Wednesday as investors grew more concerned about the lack of progress in U.S. budget talks to avoid looming spending cuts and tax hikes, setting the S&P 500 up for a third consecutive day of decline this week.

* Chief executives from top U.S. corporations, including Goldman Sachs , Deloitte LLP, and Caterpillar Inc , will meet with President Barack Obama on Wednesday to discuss U.S. fiscal problems, the White House said.

* Obama's meeting with influential leaders from the corporate world is part of his push for Congress to extend tax cuts for middle income Americans, one flashpoint in a standoff with Congress over a series of tax hikes and spending cuts that will go into effect next year if lawmakers and the president cannot come up with a deal to stop them.

* U.S. stocks slid on Tuesday in a choppy session, losing ground in the last hour before the close after Senate Majority Leader Harry Reid expressed disappointment that there has been "little progress" in dealing with the "fiscal cliff."

* S&P 500 futures were down 4.2 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures fell 30 points, while Nasdaq 100 futures were up 6.25 points.

* Deep divisions at the Federal Reserve were on display on Tuesday, just two weeks before the U.S. central bank's next policy-setting meeting, with one top Fed official pushing for more easing, and another advocating limits. [ID:nL1E8MS0ZC] The Fed will release its Beige Book summary of regional economic conditions at 2 p.m. (1900 GMT).

* New home sales data is due at 10 a.m. Economists in a Reuters survey forecast a reading of 390,000 for October versus the previous reading of 389,000.

* U.S. retailer Costco Wholesale Corp is to pay a special dividend of $7.00, worth a total $3.0 billion to investors, it said when posting monthly same-store sales that beat forecasts.

* Microsoft Corp has sold 40 million Windows 8 licenses in the month since the launch, according to one of the new co-heads of the Windows unit, setting a faster pace than Windows 7 three years ago.

* Green Mountain Coffee Roasters Inc forecast quarterly and full year earnings well above analysts' expectations, helped by an expanded lineup of single-serve coffee makers and drinks, sending its shares up 22 percent in after-hours trade.

* Advanced Micro Devices Inc plans to sell and lease back its campus in Austin, Texas, to raise cash and fund its chipmaking business as it diversifies beyond the struggling PC industry into new markets.

* Nokia said on Wednesday that an arbitrator has ruled in its favor in a patent dispute with BlackBerry-maker Research In Motion over use of Nokia's patents related to wireless local access network technology.

* The European Commission gave the go ahead for Spain to overhaul its stricken nationalized banks on Wednesday and opened the door for nearly 40 billion euros in euro zone aid to be disbursed, offering hope for an end to Spain's banking crisis.

(Reporting By Angela Moon; Editing by Kenneth Barry)

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Greece, markets satisfied by EU-IMF Greek debt deal

BRUSSELS (Reuters) - The Greek government and financial markets were cheered on Tuesday by an agreement between euro zone finance ministers and the International Monetary Fund to reduce Greece's debt, paving the way for the release of urgently needed aid loans.

The deal, clinched at the third attempt after weeks of wrangling, removes the biggest risk of a sovereign default in the euro zone for now, ensuring the near-bankrupt country will stay afloat at least until after a 2013 German general election.

"Tomorrow, a new day starts for all Greeks," Prime Minister Antonis Samaras told reporters at 3 a.m. in Athens after staying up to follow the tense Brussels negotiations.

After 12 hours of talks, international lenders agreed on a package of measures to reduce Greek debt by more than 40 billion euros, projected to cut it to 124 percent of gross domestic product by 2020.

In an additional new promise, ministers committed to taking further steps to lower Greece's debt to "significantly below 110 percent" in 2022.

That was a veiled acknowledgement that some write-off of loans may be necessary in 2016, the point when Greece is forecast to reach a primary budget surplus, although Germany and its northern allies continue to reject such a step publicly.

Analyst Alex White of JP Morgan called it "another moment of ‘creative ambiguity' to match the June (EU) Summit deal on legacy bank assets; i.e. a statement from which all sides can take a degree of comfort".

The euro strengthened, European shares climbed to near a three-week high and safe haven German bonds fell on Tuesday, after the agreement to reduce Greek debt and release loans to keep the economy afloat.

"The political will to reward the Greek austerity and reform measures has already been there for a while. Now, this political will has finally been supplemented by financial support," economist Carsten Brzeski of ING said.

PARLIAMENTARY APPROVAL

To reduce the debt pile, ministers agreed to cut the interest rate on official loans, extend the maturity of Greece's loans from the EFSF bailout fund by 15 years to 30 years, and grant a 10-year interest repayment deferral on those loans.

German Finance Minister Wolfgang Schaeuble said Athens had to come close to achieving a primary surplus, where state income covers its expenditure, excluding the huge debt repayments.

"When Greece has achieved, or is about to achieve, a primary surplus and fulfilled all of its conditions, we will, if need be, consider further measures for the reduction of the total debt," Schaeuble said.

Eurogroup Chairman Jean-Claude Juncker said ministers would formally approve the release of a major aid installment needed to recapitalize Greece's teetering banks and enable the government to pay wages, pensions and suppliers on December 13 - after those national parliaments that need to approve the package do so.

The German and Dutch lower houses of parliament and the Grand Committee of the Finnish parliament have to endorse the deal. Losing no time, Schaeuble said he had asked German lawmakers to vote on the package this week.

Greece will receive 43.7 billion euros in four installments once it fulfils all conditions. The 34.4 billion euro December payment will comprise 23.8 billion for banks and 10.6 billion in budget assistance.

The IMF's share, less than a third of the total, will be paid out only once a buy-back of Greek debt has occurred in the coming weeks, but IMF Managing Director Christine Lagarde said the Fund had no intention of pulling out of the program.

Austrian Chancellor Werner Faymann welcomed the deal but said Greece still had a long way to go to get its finances and economy into shape. Vice Chancellor Michael Spindelegger told reporters the important thing had been keeping the IMF on board.

"It had threatened to go in a direction that the IMF would exit Greek financing. This was averted and this is decisive for us Europeans," he said.

The debt buy-back was the part of the package on which the least detail was disclosed, to try to avoid giving hedge funds an opportunity to push up prices. Officials have previously talked of a 10 billion euro program to buy debt back from private investors at about 35 cents in the euro.

The ministers promised to hand back 11 billion euros in profits accruing to their national central banks from European Central Bank purchases of discounted Greek government bonds in the secondary market.

BETTER FUTURE

The deal substantially reduces the risk of a Greek exit from the single currency area, unless political turmoil were to bring down Samaras's pro-bailout coalition and pass power to radical leftists or rightists.

The biggest opposition party, the hard left SYRIZA, which now leads Samaras's center-right New Democracy in opinion polls, dismissed the deal and said it fell short of what was needed to make Greece's debt affordable.

Greece, where the euro zone's debt crisis erupted in late 2009, is proportionately the currency area's most heavily indebted country, despite a big cut this year in the value of privately-held debt. Its economy has shrunk by nearly 25 percent in five years.

Negotiations had been stalled over how Greece's debt, forecast to peak at 190-200 percent of GDP in the coming two years, could be cut to a more bearable 120 percent by 2020.

The agreed figure fell slightly short of that goal, and the IMF insisted that euro zone ministers should make a firm commitment to further steps to reduce the debt if Athens faithfully implements its budget and reform program.

The main question remains whether Greek debt can become affordable without euro zone governments having to write off some of the loans they have made to Athens.

Germany and its northern European allies have hitherto rejected any idea of forgiving official loans to Athens, but European Union officials believe that line may soften after next September's German general election.

Schaeuble told reporters that it was legally impossible for Germany and other countries to forgive debt while simultaneously giving new loan guarantees. That did not explicitly preclude debt relief at a later stage, once Greece completes its adjustment program and no longer needs new loans.

But senior conservative German lawmaker Gerda Hasselfeldt said there was no legal possibility for a debt "haircut" for Greece in the future either.

At Germany's insistence, earmarked revenue and aid payments will go into a strengthened "segregated account" to ensure that Greece services its debts.

A source familiar with IMF thinking said a loan write-off once Greece has fulfilled its program would be the simplest way to make its debt viable, but other methods such as forgoing interest payments, or lending at below market rates and extending maturities could all help.

German central bank governor Jens Weidmann has suggested that Greece could "earn" a reduction in debt it owes to euro zone governments in a few years if it diligently implements all the agreed reforms. The European Commission backs that view.

The ministers agreed to reduce interest on already extended bilateral loans in stages from the current 150 basis points above financing costs to 50 bps.

(Additional reporting by Annika Breidhardt, Robin Emmott and John O'Donnell in Brussels, Andreas Rinke and Noah Barkin in Berlin, Michael Shields in Vienna; Writing by Paul Taylor; editing by David Stamp)

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