Timor capital calm after president takes charge

DILI, May 31 (Reuters) East Timor's capital was calm for the first time in more than a week today as residents digested news that independence hero President Xanana Gusmao had assumed sole responsibility for the country's security.

Gusmao's proclamation on Tuesday night appeared to quell the violence by gangs of youths who have been on a rampage of looting and arson sparked by the dismissal of nearly half the army.

Gusmao said he was taking sole responsibility for the tiny nation's armed forces and would also be in charge of coordinating a 2,500-strong Australian-led international peacekeeping force that East Timor asked for last week to restore order.

His move -- assuming emergency powers without declaring a formal state of emergency -- is seen as further isolating Prime Minister Mari Alkatiri, whose handling of the affair has been heavily criticised both in Timor and abroad.

''There was always a wedge between them, but that wedge has been hit with a sledgehammer,'' one diplomat told Reuters.

But Alkatiri added confusion to Timor's already complex political situation today by insisting he was still in charge.

''You are wrong, completely wrong, he (Gusmao) is not taking control,'' he told Australian Broadcasting Corporation radio.

''The defence and security is still part of the government, and I am the head of the government,'' he said, blaming the confusion of a misinterpretation of Gusmao's statement from Portuguese into English.

On the street, those who have heard the news have no doubt who is in charge.

''This is good. Now we can go back to our homes,'' said Jose Aurajo, who has slept for the past five nights along with hundreds of other people in the carpark of his neighbourhood church.

''Gusmao will never let the nation down. Alkatiri must take responsibility for this and must resign.'' MAN OF THE PEOPLE Gusmao is seen as man of the people, an independence hero who fought against Indonesia's colonial rule and who spent years in jail for his beliefs.

Alkatiri, who spent much of his life as an exile in Angola and Mozambique, is seen as far more aloof and lacking Gusmao's liberation pedigree.

A few plumes of smoke rose today into the sky above the hill-ringed capital, but nothing like the pall from dozens of torched houses in previous days.

With nearly the entire Australian-led peacekeeping force now on the ground in the capital, residents who had fled their homes for sanctuary in churches and schools began returning to their neighbourhoods.

A top Australian military official said Canberra planned to keep troops in East Timor for at least six months but hoped to scale down its deployment as order returned.

''Our planning base is on the basis of a six-month deployment,'' military commander Angus Houston Houston told a parliamentary hearing.

''My hope is that as things stabilise, we can adjust the force downwards at some time in the future. But I'm not focused on that at the moment.'' Australia last led troops into East Timor in 1999 to restore law and order after violence by militia groups, supported by elements of the Indonesian military, following a vote to break free of Indonesian rule.

The current violence and request for foreign help are major embarrassments for the government, handed the keys to the country by the United Nations in 2002 after the world body ran the nation following the bloody referendum.

Reuters SRS DB1026