Lebanon's Lahoud says will install govt if no deal

BEIRUT, Aug 30 (Reuters) Lebanon's pro-Syrian president today said he would appoint an interim government headed by the army chief if rival Lebanese leaders cannot agree on a new head of state before his term expires in November.

President Emile Lahoud's remark raised the stakes in a deep political conflict which pits the anti-Syrian Beirut government, backed by the United States, against an opposition coalition including factions allied to Damascus and Tehran.

Such a step by Lahoud would result in two governments, assuming army commander Michel Suleiman were to accept the job, analysts said. There was no immediate word from Suleiman.

The constitution says parliament should meet on September 25 to elect a replacement for Lahoud, whose term expires at midnight on November 23. But as yet there is no sign of a settlement to the political conflict that would let the vote to go ahead.

''The government which is still standing and which is unconstitutional ... cannot assume power if the election of a president of the republic is not possible,'' said Lahoud, in reference to the cabinet of Prime Minister Fouad Sinora.

The opposition, including Shi'ite Muslim Hezbollah, is demanding veto power in cabinet and a consensus presidential candidate as conditions for attending the presidential election. Opposition MPs are needed at the vote for a two-thirds quorum to be met.

The governing coalition has so far refused to yield to the opposition, which has been pressing its demands since November in Lebanon's worst political conflict since the 1975-1990 civil war.

Druze leader Walid Jumblatt, an influential anti-Syrian leader, said last week his coalition had the right to call its parliamentary majority to elect a new president in November without the opposition in attendance.

But Lahoud, a close ally of Syria, said a president ''for all Lebanon'' must be elected with the two-thirds quorum.

''If that doesn't happen ... the leader of the army will come for an interim period as head of the government, with a clear mission to lay down an electoral law acceptable to all,'' he said in a statement.

Parliamentary elections would then be held as quickly as possible, he added. It was the first time Lahoud has spelt out what he will do if there is no settlement to the political crisis before he leaves office.

Analysts say the governing coalition will reject any such move, leaving Lebanon with two governments. ''This is two governments.

Absolutely,'' said Oussama Safa, head of the Lebanese Centre for Policy Studies.

Were Suleiman to accept the post, Safa said the army would likely be divided. Soldiers loyal to governing coalition leaders would split from those who sympathise with the opposition.

Such a step by Lahoud would mirror a move in 1988 when former President Amin Gemayel named then army chief Michel Aoun to head a military government in conflict with the existing cabinet.

Lahoud said the government he had in mind would not be a military cabinet. There would be six or seven civilian ministers representing the main religious communities in Lebanon, where power is divided according to a sectarian power-sharing system.

Reuters MS GC2326