Yemen's Saleh offers handover

Yemen's President Ali Abdullah Saleh pledges to hand over power but only to "safe hands", in a defiant speech to massed supporters after talks with a top defector failed to defuse the country's crisis.

"We will stand firm with you ... steadfast in the face of all challenges," Saleh, wearing a suit and sunglasses and confidently waving his right hand, told vast crowds in the Yemeni capital on Friday.

"We don't need power. We need to hand it over to safe hands, and not to corrupt and hateful hands ... You are the ones who will be handed power," he said, triggering massive applause.

Saleh, whose concessions and offers to stand down early have been snubbed by the opposition, renewed his invitation for youths at the forefront of the protests to join a dialogue.

"I am ready to talk to you and to form a political party for the youths," said the strongman who has ruled Yemen for more than 30 years.

In behind-the-scenes talks aimed at averting more bloodshed, Saleh and top dissident General Ali Mohsen al-Ahmar, considered the second strongest man in Yemen, failed to strike a deal on Thursday night, the two sides said.

Ahmar, a regional army commander who has sided with and vowed to defend the protesters, is leading efforts to form a transitional council grouping all sides, according to sources close to the secret negotiations.

With hundreds of thousands of rival demonstrators on Sanaa's streets, soldiers fired warning shots to prevent loyalists whipped up by Saleh's speech attacking anti-regime protesters on Friday, the Muslim day of prayers and rest.

There were no immediate reports of casualties at the demonstrations.

The rallies came one week after a bloodbath in which 52 protesters were gunned down by Saleh loyalists, drawing widespread international condemnation and a spate of defections from within his ruling circle.

The anti-Saleh protesters were on Friday gathered at a square near Sanaa University where they have been camped since February 21, while regime loyalists crowded a nearby square in response to calls from the president.

"The people want Ali Abdullah Saleh," his supporters shouted.

The army and opposition activists set up separate checkpoints at entrances to the square near the university, searching people entering and leaving the epicentre of the revolt against Saleh's three-decade rule.

Police also set up checkpoints leading to the venue of the loyalist protest, about four kilometres away.

But with rival military units, also split by the two-month-old political crisis, Salah late on Thursday vowed to defend himself by "all possible means" and urged army officers who defected to return to the fold.

"We are determined to preserve the security, independence and stability of Yemen by all possible means," he told army and police officers at a meeting broadcast on state television.

Deserted by long-time military, political, tribal and clerical backers, Saleh has dubbed the show of solidarity a "Friday of Tolerance", countering the pro-change slogans of demonstrators around the Arab world.

State of emergency

On Wednesday, parliament voted for a state of emergency declared by Saleh just hours after the March 18 bloodbath in Sanaa. In theory, the measure outlaws demonstrations and would allow the regime to gag the media.

The opposition has said it will hold off until the following Friday, April 1, to march on the presidential palace for what many fear could prove a bloody final showdown.

Saleh has offered his foes a deal on forming a unity government, drawing up a new electoral law and holding a legislative poll, and to step down in favour of a successor to be chosen by newly-elected MPs by the end of 2011.

Under the weight of protests, which Amnesty said has cost 95 lives in clashes with security forces, the president is offering to step down 20 months earlier than September 2013 when his latest seven-year term comes to a close.

But opposition sources say the time for concessions from the president is over and that behind-the-scenes consultations have been taking place for a peaceful transition of power to a post-Saleh era.