Sarkozy receives Bush greeting as French protests brew

PARIS, May 10 (Reuters) US President George W Bush today said he looked forward to working with ''smart, capable'' French president-elect Nicolas Sarkozy, as sporadic youth protests against the rightist's election continued in France.

Sarkozy's election raises the possibility of a closer US-French alliance, a shift from the strained relations Bush and outgoing President Jacques Chirac have had over Iraq.

Bush said he telephoned Sarkozy shortly after his election victory against Socialist Segolene Royal on Sunday.

''I had met with him before when he came over here and found him to be a very engaging, energetic, smart, capable person. We will have our differences and we will have our agreements, and I'm looking forward to working with him,'' Bush said.

Sarkozy has said France would be a friend to the United States but that there were differences in areas such as global warming that he would address.

Bush's comments came as Sarkozy received clear signs at home from trade unions, students and rioters that his promise of change in domestic areas ranging from labour laws to education would face significant opposition.

In northern Rouen, some 400 to 500 youths lobbed bottles at police. Officers used tear gas to disperse the crowd, and several people were arrested.

''We're Sarkozy's nightmare,'' read posters put up on walls to call for the protests. ''The war has only just started. We're not 'his France' and we'll make him realise that.'' After winning the election on Sunday, Sarkozy left for a two-day retreat near Malta aboard the luxury yacht of a billionaire friend, provoking anger among opposition parties.

He returned to Paris overnight looking suntanned and relaxed, and appeared alongside Chirac today at a ceremony in Paris to commemorate victims of slavery. Sarkozy, who takes over from Chirac on May 16, waved to crowds but said nothing.

Yesterday night, police had faced off against rioters just streets away from where today's ceremony took place.

University authorities also shut down one site in Paris that was occupied overnight by students who said plans to give universities more autonomy and introduce some selection in student admissions amounted to ''hidden privatisation''.

The students voted today to end their action, which was criticised by main student union Unef. Protests may now be put on hold until Sarkozy tries to enact his election pledges.

Police said four nights of violence in Paris and other cities after Sunday's election left more than 1,500 cars burnt out and scores of shop windows smashed. However, the incidents seemed to be diminishing in severity, officials said.

UNION WARNINGS Trade unionists have warned Sarkozy he cannot crush union opposition to his reforms just because he won a ballot.

''Mr Sarkozy has been elected. But I don't think that you can consider that there is a general agreement over his programme or that he has the legitimacy to do just anything,'' Bernard Thibault from the main CGT union told Le Monde.

With a parliamentary election next month, Sarkozy has sought to soften his authoritarian image and allies have offered reassurances that his plans to shake up rules on union rights will not be implemented without consulting all parties.

Sarkozy plans rules to force public sector unions to maintain a minimum service during strikes and to reform pension regulations that allow workers in some sectors to retire early with full benefits.

His allies have insisted the new president's clear election victory means unions did not have a right to block the changes.

Reuters JK SBA VP0120