In blunt remarks, he told a gathering of Muslim officials in Germany that Muslim leaders had a "great responsibility" in properly educating their younger generations.

Under the deal, half the blocked goods will be released unconditionally. The rest will count against 2006 quotas.

The EU imposed quotas in June to stem a huge surge in Chinese imports, after a worldwide, decades-old textile tariff and quota system ended in January.

Offers streamed in after the United States, the world's biggest single aid donor, said it would be open to assistance though it was not making an appeal for foreign aid. "Whatever they ask for, it will be given, from reserves of oil... to any other thing that they may need," European Union foreign policy chief Javier Solana said in Newport, Wales, during a meeting of the 25-nation bloc.

George Bush arrived last night in the ravaged Gulf coast region amid mounting criticism of his handling of the crisis and a prediction by one senator that the death toll in Louisiana alone could top 10,000 people.

As thousands of people sat on the streets of New Orleans, having spent their fourth day waiting to be rescued, the city fell deeper into chaos, with gangs roaming the city and corpses rotting in the sun.

"The damage is far worse than any of us imagined at first," Mr Annan said in a statement. "The American people who have always been the most generous in responding to disasters in other parts of the world have now themselves suffered a grievous blow.

Divided in grief, the town of Beslan began three days of remembrance yesterday to mark the first anniversary of the school siege that left 331 people dead and a community in ruins.

The head of the UN's nuclear watchdog is due at the weekend to issue a report on Iran's nuclear activities, which could finally prod the agency to back a US push to refer Iran to the UN Security Council.

The situation arose from Iran's decision to resume sensitive uranium work in violation of an agreement it negotiated with three EU nations last November.

About 23,000 refugees stuck at the New Orleans Superdome arena after Hurricane Katrina flooded the city will be given shelter in Houston, Texas Governor Rick Perry said on Wednesday, as looters and rising floodwaters sowed chaos in the devastated Louisiana city.

Residents of the devastated Gulf Coast region face new threats in the form of disease, health experts fear.

Mayor Ray Nagin ordered 1,500 police officers to leave their search-and-rescue mission Wednesday night and return to the streets to stop looting that has turned increasingly hostile as the city plunges deeper into chaos.

Some major carriers have canceled flights to New Orleans increasing financial pressure for the airlines as they also deal with potential fuel shortages.

Hurricane Katrina was the third-most intense hurricane to ever hit the United States since reliable records began in 1851, according to the National Weather Service. Only the "Labor Day Hurricane" that hit the Florida Keys in September 1935 and 1969's Hurricane Camille were more intense.

Katrina spared almost nothing along Mississippi's 90 miles of coastline. From the coin-spitting slot machines of Biloxi to the stately Southern beach cottages of Bay St Louis, they have all been devastated in a way that will take years, if not decades, to recover.

For years, engineers up and down the Mississippi River have talked about the disaster that would result if New Orleans' bulwark of levees and flood walls were hit by a hurricane like Katrina. But when it was time to find money to strengthen them, the city's defenses ended up far down the federal government's priority list.

Medecins Sans Frontieres (MSF) says that in the town of Galcayo alone, it has treated more than 500 victims of violence this year. It runs two hospitals in the town, which is divided into two areas, controlled by rival warlords. Somalia has not had a functioning national government for 14 years.

Asia's oil-guzzling economies are bracing themselves for the worst as crude prices threaten to hit 70 dollars a barrel, stoking fears of slower growth, soaring inflation and rising interest rates.

Pope Benedict XVI has arrived in his native Germany for a Catholic youth festival in the city of Cologne. During his four-day stay in Cologne, the Pope plans to meet representatives of Germany's Protestant churches, and also Muslims and Jews.