The suicide bombings have not stopped, nor has the stream of anti-western invective from websites and audio broadcasts from those sympathetic to al-Qaeda. So who is winning and who is losing the war ? If we were to look at this purely in terms of military gains the answer would be obvious.

The US has swiftly toppled two governments it considered to be rogue regimes ? first in Afghanistan, then in Iraq. The Pentagon?s supremacy on the battlefield is unrivalled and unstoppable. Its troops are holding down a sort of peace in both countries. But waging a war on terror is a complex business.

In fact many in Britain are convinced that the regime of Saddam Hussein, brutal as it was, had little to do with terrorism per se. The most dangerous enemy for the US in particular, and for the West and its allies in general, remains the secretive terror networks inspired by ? but not necessarily linked to ? al-Qaeda. So what progress is being made by those trying to stop them ? Since it was President Bush who declared the war on terror two years ago, let us look at the gains and losses from the perspective of his administration.

- Key arrests

There have, unquestionably, been some major arrests in recent months. Last year the FBI seized al-Qaeda operations chief Abu Zubaydah in Pakistan. Although at first he was able to mislead his captors with false trails, his interrogation has eventually helped the US catch more members of the network.

In September 2002 Pakistani police seized the self-confessed 11 September plotter Ramzi Binalshibh in Karachi. Six months later they caught Khalid Sheikh Muhammed, arguably the most important operational member of the network now in custody.

In August Thai police working with the CIA captured Riduan Isamuddin ? also known as Hambali ? believed to be the key link between al-Qaeda and its south-east Asian affiliate, Jemaah Islamiah. There have also been a number of important arrests in Saudi Arabia, while Iran is believed to be holding Sulaiman Abu Ghaith, once the main spokesman for Al-Qaeda who used to appear in videos sitting beside Osama Bin Laden in Afghanistan.

On 24 July, 2003, US Vice-President Dick Cheney gave this upbeat assessment: ?One by one, in every corner of the world, we will hunt the terrorists down and destroy them.? But while these arrests have all dealt blows to al-Qaeda and its affiliates, other recruits will be quick to replace them and in time they will develop similar skills.

- Deaths

The most spectacular death of any al-Qaeda member since 11 September was the targeted assassination in Yemen in November 2002 of Qaed Senyan al-Harthi.

With permission from the Yemeni authorities, the CIA launched an unmanned Predator drone aircraft from Djibouti, identified a car carrying the suspect and five others, then fired a Hellfire missile at it, killing all the occupants.

Al-Harthi had been on the run for years and was believed to be planning attacks on western interests in the region, possibly shipping. But the way he was killed was so controversial that the CIA have not repeated it outside Afghanistan.

In Saudi Arabia the security forces have been fighting gun battles on an almost weekly basis with well-armed Islamist militants. In one such battle in July they cornered a cell leader called Turki Nasser al-Dandani in a remote mosque in the north. To the dismay of local villagers, the police poured machine-gun fire into the mosque and he died along with other fugitives.

But the Saudi authorities also bungled an attempt to capture alive one of the most wanted al-Qaeda suspects. Mohammed al-Ayeeri was killed in a gun battle north of Riyadh in May.

At a stroke, the Saudis ? and the CIA ? lost the chance to interrogate the man believed to be the mastermind behind one of al-Qaeda?s websites. The contacts he held in his head would undoubtedly have led to many arrests.

- International co-operation

After 11 September most countries were quick to sign up in principle to President Bush?s war on terror. But in practice, for many of them the co-operation was half-hearted until they themselves were hit. Since the Bali bombing of October 2002 Indonesia has opened up its resources to the FBI and Australian investigators, pursuing a more pro-active and often unpopular stance towards extremists.

Similarly, it took the Riyadh bombings of 12 May 2003 for the Saudis to finally take seriously the security problem they had on their hands. Since then they have gone to great lengths to try to wrap up the terror networks that have secretly flourished in their midst.

The Saudis have also begun trying to tackle the problem at grassroots level, removing hundreds of anti-western imams from their mosques and sending them to Riyadh for retraining ? i.e. instruction in how not to incite attacks on westerners. There is, however, a flip side to this co-operation. Since US policies in the Middle East are deeply unpopular with many Arabs, any government seen cracking down on Islamist militants at Washington?s behest risks upsetting the wider population.

In Saudi Arabia, where most people strongly condemn the Riyadh bombings, there is also a backlash of resentment at all the extra security measures such as impromptu checkpoints.

- Increased preparedness

In Britain and America there is no such backlash. Both governments have warned that a major attempted attack by al-Qaeda-linked terrorists is inevitable. They have been preparing accordingly and few are complaining.

In the US, the Federal Emergency Management Agency (FEMA) has given $100m to state and local governments to update their emergency hazard contingency plans. Exercises have been held across the US, training people how to deal with deliberate releases of pneumonic plague, radiological and other biological weapons.

In Britain the placing of concrete crash barriers around the Palaces of Westminister is only the tip of the counter-terrorist iceberg. Millions of pounds have been earmarked for mass decontamination and monitoring equipment.

Extra funding has been given to the Metropolitan Police?s counter-terrorism unit and hundreds of mobile decontamination units have been ordered. In terms of intelligence gathering the most significant development in Britain has been the establishment in London of JTAC, the Joint Terrorism Assessment Centre.

Employing dozens of specialists from several agencies, this secretive unit continually monitors the threat from terrorism to Britain?s interests. Its recent assessment of the security risk in Saudi Arabia resulted in the suspension of British Airways flights to both Riyadh and Jeddah.

- Silencing al-Qaeda

Although this will never be 100% effective, it is now far harder for al-Qaeda?s remnant leadership to communicate effectively with the rest of the world. Back in 2001 the videotapes came thick and fast, featuring Osama Bin Laden, his number two Ayman al-Zawahri, and others, all calmly putting their views forward to a rapt audience on satellite TV. No longer.

The messages that leak out from al-Qaeda and its affiliates these days tend to be audio broadcasts on the Internet or faxed messages sent to news networks. It is often hard to establish their authenticity. Wannabe groups have sprung up, sometimes trying to take the credit for operations they did not carry out.

- More attacks

The attacks have not stopped. In October 2002 the Bali bomb killed 202 people. Then came the attack on the hotel near Mombasa in November 2002.

Then a lull, then the triple bombings in Riyadh in May 2003, killing more than 30 people. Then there was Casablanca, Jakarta and a whole string of major bombings in Iraq that may or may not be connected to Islamist suicide bombers sympathetic to al-Qaeda.

US intelligence analysts are convinced that the US remains the prime target and that Bin Laden?s supporters have not given up their quest to carry out a truly devastating and humiliating attack on either the US or Britain.

- Diversification

Before the Afghan campaign of 2001, al-Qaeda was relatively easy to find. It had a logistical and command headquarters in Afghanistan.

Now that it has been scattered across the world it has been likened to a hornet?s nest hit with a stick. The hornets are everywhere and harder to catch. In order to survive, al-Qaeda has successfully mutated. It is no longer a structured organisation with different divisions for financing, recruitment and operations.

Instead it has transferred its ideology and some of its expertise and finance to splinter groups such as Jemaah Islamiah in Asia, Jihadi militants in East Africa and certain North African cells in Europe.

Often these cells know nothing about each other. They are able to tap into an extensive underworld using false passports, visas and counterfeit money. In the case of North African operatives in Europe they have sometimes been able to move easily between countries, evading the attention of the authorities.

- New methods

The most alarming new development is the threat from surface-to-air missiles (SAMs). A failed attempt was made in June 2002 to use them in Saudi Arabia to bring down a US military aircraft. Al-Qaeda operatives tried again in Kenya in November 2002 and narrowly missed shooting down an Israeli airliner with over 200 passengers on board.

In February 2003 there was a full-scale alert at London?s Heathrow Airport following a warning passed to the intelligence services that terrorists were looking to shoot down an airliner as it came in to land. There have also been a number of SAM attacks on aircraft in Chechnya and Iraq.

The threat of a chemical/biological attack on a western civilian population was brought closer in January 2003 with the discovery of the lethal toxin ricin at a north London flat.

While in this case nobody has been convicted, it is known that al-Qaeda conducted experiments in Afghanistan using poisonous chemicals, practising on live animals.

Amongst other new methods of operation being employed by al-Qaeda supporters is the recruitment of new converts from non-Arab ethnic groups for future operations. This is something which is deeply troubling the FBI and other investigators.

Frank Gardner

The battle over Ground Zero

Two years after the attack on the World Trade Center, intense passions still swirl around the redevelopment project.

This week, a group of victims? families gathered at the construction site in Lower Manhattan to protest against plans to rebuild on the foundations of the obliterated twin towers. They argue it constitutes a sacred cemetery for the thousands of people who died there.

This latest protest is one of countless wrangles that have dogged the project so far. The rebuilding has only inched forward and looks certain to take a lot longer to complete that first planned. Further, designs to rebuild the 17-acre complex may yet be altered by the powerful parties who hold a stake in the site. Last February, architect Daniel Libeskind won a competition to redesign the World Trade Center site, in a very public selection process.

With its overt symbolism, the design was a popular choice. But, since then, Mr Libeskind?s artistic vision has clashed with the commercial demands of prime real estate. Many people, such as the victims relatives? groups, are questioning whether the public?s voice will, in the end, be drowned out. Part of the problem is that this is widely seen as one of the most important urban redevelopment sites in the world and there are so many interested parties whose differences need to reconciled ? victims? families, downtown residents, businessmen, architects, developers and politicians.

Two main features of the Libeskind plan aroused opposition from the outset ? the centrepiece ?Freedom Tower? and a sunken memorial garden, which was welcomed by victims? relatives. The tower was to be 540m high, echoing the date of the founding of the republic. Its off-centre spire at the top conjured up the Statue of Liberty?s torch.

But business groups and leaseholder Mr Silverstein questioned the wisdom of building such a large tower. They asked whether companies would, indeed, want to lease space in such a tall building anymore.

Although Mr Silverstein has no legal right to say what should or should not be built, he has much financial and political clout. He is still paying the rent on the site and it is his multi-billion-dollar insurance claim that is paying for the rebuilding.

A property developer in his 70s, Mr Silverstein has already brought his weight to bear on the design of ?Freedom Tower?.

He argued that the symbolic spiral at the tip of the tower is too expensive to build and pushed for something more straightforward. As part of a compromise, Mr Libeskind relinquished control for the tower to another architect chosen by Mr Silverstein.

The property developer has also suggested that the tower be moved to a site closer to the transport hub, where he says it will be easier and more profitable to rent. A further bone of contention in Mr Libeskind?s plans is the 4.7-acre pit that was once the foundations, or footprint, of the twin towers. A 70-foot steel-enforced concrete ?slurry wall?, once encased these foundations.

After the attacks, the wall, which was all that was left of the trade center complex, kept the waters of the Hudson River at bay. Mr Libeskind has imbued it with heroic status, as an emblem to resistance to terrorism.