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Vatican budget remains in the red

VATICAN CITY - The Vatican reported a deficit for the third consecutive year Wednesday but an increase in donations provided a bright spot at a time of some dismal financial news for the Catholic Church because of settlements from the sex abuse scandal.

In its annual financial report, the Vatican listed a 2003 deficit of about $11.8-million, 30 percent lower than than the 2002 figure. It reduced the shortfall despite the costs for the Holy See's expanding diplomatic missions.

At the same time, it reported an increase in contributions to the pope, known as Peter's Pence, which it said were used for various humanitarian relief efforts around the world and for the Catholic Church in the Holy Land.

Dioceses around the world are largely independent of Vatican financial control, although they are expected to seek Vatican approval before taking such drastic steps as seeking bankruptcy protection.

The Portland, Ore., Archdiocese became the first American diocese to do so Tuesday because of heavy claims. Boston has threatened to do so at the height of the scandal two years ago.

JAKARTA, Indonesia - A September contest to choose Indonesia's next leader was shaping up Wednesday to be a tough fight between front-runner Susilo Bambang Yudhoyono, a former security minister, and President Megawati Sukarnoputri, who appeared to have clinched the second spot for the runoff election.

With more than half the votes counted in Monday's first round, Yudhoyono was leading with 34 percent while Megawati - making a stronger showing than many expected - was second with 26 percent. The top two finishers will go head to head in an election Sept. 20.

While the aloof Megawati has often appeared ineffective in dealing with the country's lawlessness and poverty, Monday's vote shows that she still has a considerable base of support and can use the power of her office to sway the electorate.

At the same time, Yudhoyono, a charismatic retired general who was so far ahead in the polls last month that some speculated he might win a majority in the first round, seems to have lost considerable support in the closing days of the campaign.

COLOMBIA: A suspected leftist rebel extradited to the United States last year for his alleged role in the murder of three Americans has been sent back to Colombia after prosecutors failed to link him to the killings, authorities said Wednesday. Nelson Vargas Rueda was returned to Colombia on Friday after spending more than a year in a U.S. jail. U.S. Justice Department spokesman Bryan Sierra said the case against Vargas was dismissed because the prosecution had been unable to produce two key witnesses.

HONG KONG: Bowing to pressure over a slow, sloppy response to SARS, Hong Kong's health secretary resigned to take blame for the crisis that killed hundreds and caused months of uncertainty and fear in the territory. Dr. Yeoh Eng-kiong became a rare political casualty in a territory where critics charge that top aides of Hong Kong's leader, Tung Chee-hwa, often avoid being held accountable for problems.