- Associated Press - Sunday, October 7, 2012

MONTEVIDEO, Uruguay (AP) — The continued exchange of artillery fire between Syria and Turkey raises additional concerns that the conflict may escalate and spread to neighboring countries, U.S. Defense Secretary Leon E. Panetta said Saturday.

Mr. Panetta said the U.S. is using its diplomatic channels to relay worries about the fighting in the hopes that it will not broaden.

His comments came on the heels of warnings from Turkey‘s prime minister that his country is not far from war with Syria.

Turkish and Syria traded artillery fire Saturday and Sunday as rebels clashed with President Bashar Assad’s forces near the border, heightening the fears that the crisis could erupt into a regional conflict. Turkish Prime Minister Recep Tayyip Erdogan on Friday cautioned Damascus not to test Turkey‘s “limits and determination” and said Ankara was not bluffing in saying it won’t tolerate such acts.

In other comments during a press conference with Peruvian Defense Minister Pedro Cateriano, Mr. Panetta warned that the international community is ready to impose more sanctions against Iran if the country does not begin to address concerns about its nuclear program.

The economic sanctions are having a damaging effect on Iran, as inflation and unemployment rise and the value of the currency drops, increasing prices.

Iran, Mr. Panetta said, has to engage seriously with the international community to resolve issues with its nuclear program, and if it doesn’t, “make no mistake, the international community will continue to impose additional sanctions.”

Mr. Panetta’s comments came after meetings Saturday with Peruvian President Ollanta Humala and the country’s Defense Ministry — dubbed the Pentagonito — to continue meetings with Mr. Cateriano.

After his meeting with Mr. Humala, Mr. Panetta said the U.S. is increasing efforts to build partnerships in the region and said America will do whatever it can to provide assistance to Peru to meet the challenges of terrorism, drug trafficking and humanitarian needs.

Later, he and Mr. Cateriano, during a joint press conference, said that they are negotiating an update in the defense cooperation agreement between their two countries.

Noting that the last agreement was sealed in 1952, Mr. Panetta said the U.S. is committed to improving its ability to conduct joint military exercises, training and education exchanges with Peru.

Mr. Cateriano said updating the agreement will help his country modernize its military. Officials said that while Peru would like American helicopters, the two defense chiefs reached no agreement on any new weapons sales.

Mr. Panetta also said that the U.S. wants to work with Peru to confront the drug trafficking, calling it “one of the most serious threats we face in the hemisphere.” He said he listened to the concerns of the Peruvian officials and will determine if there is any additional help the U.S. can provide.

A senior defense official traveling with Mr. Panetta said the laws in Peru have changed over the past 60 years, as have the security challenges in the country, including the increased threat of narcotics trafficking.

Some of the law changes have had an impact on how the U.S. can do joint military exercises in the country. The official, who spoke on condition of anonymity because negotiations are continuing, said some of the newer laws may be more restrictive, so the updated agreement would reflect how the U.S. and Peru can conduct military exercises under those guidelines.

Mr. Panetta left Peru and arrived on Saturday afternoon in Uruguay, where he was set to attend a regional meeting of defense ministers from the Americas.

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