Chirac looks to loyal aide in hour of need

PARIS - Savaged by a public that just three years ago elected him President by the biggest margin in French history, Jacques Chirac has beaten the drum of patriotism and turned to a loyalist technocrat, Dominique de Villepin, in the hope of salvaging his final years in office.

De Villepin, best known for leading the diplomatic opposition to the Iraq war while Foreign Minister, was named Prime Minister two days after French voters tossed out a proposed European constitution, opening up national fractures and plunging the European Union into crisis.

"The May 29 referendum on the European constitution has opened a period of difficulties and uncertainties for Europe and for France," Chirac admitted in an address to the nation from the Elysee Palace. "In this period, we must rally around the national interest."

He claimed that French voters, who turned down the proposed EU charter by a 55-45 per cent margin, had not rejected "the European ideal" but were voicing "a dissatisfaction and an insecurity in the light of today's world".

The 72-year-old head of state promised that unemployment, obstinately stuck at more than 10 per cent of the workforce, would be France's top priority but warned the task required "a national mobilisation".

He stood against "Anglo-Saxon type" economic liberalism - a term that in France is synonymous with Victorian-style labour abuse - but warned that everyone, unions and bosses included, had to listen to proposals without prejudice.

De Villepin, declared Chirac, "has the authority, the competence and experience" to meet these goals.

The reshuffle had been looming since last week, as Chirac realised the constitution and referendum that he had championed were heading for a fiasco.

Instead of endorsing a charter that Chirac portrayed as the cornerstone of closer European union, voters backed arguments by the far left and right that the EU was becoming a superstate which steamrollered national sovereignty and workers' rights.

Just three years earlier, Chirac had been elected head of state for a second successive term, harvesting 81 per cent of the vote in a runoff against the xenophobic ultra-rightist, Jean-Marie Le Pen.

But a slumping economy and now the impending referendum defeat ravaged his legitimacy, setting him on course for two years as a lame duck.

Heading out of the exit door is Jean-Pierre Raffarin, whom Chirac had plucked out of obscurity in 2002, believing his small-town provincial style would steer through some modest reforms on labour laws and welfare.

Sandwiched between a suspicious public and a head of state who, under the French constitution, is endowed with vast powers, Raffarin gamely did his best before becoming a scapegoat.

Taking his place in what has been dubbed "the worst job in France" is Raffarin's temperamental opposite. The silver-haired de Villepin, 51, moving from the Interior Ministry, is a technocrat of semi-aristocratic background. Full name Dominique Marie Francois Rene Galouzeau de Villepin, he is a graduate of the elite National School of Administration who leavens a scholarly intellect with occasional bouts of mercurial behaviour.

He won fame at home and abroad for his suave arguments at the United Nations in 2003 against the United States-led war on Iraq but is disliked by MPs for his haughty style.

As part of the reshuffle, Chirac has had to give a Cabinet seat to Nicolas Sarkozy, an energetic pro-reformist who heads Chirac's UMP party.

Sarkozy, 50, is a fierce critic of Chirac and is said to nurse a deep loathing of de Villepin, and thus his inclusion in the Cabinet spells storms ahead.

Chirac said Sarkozy would be named "minister of state" but gave no details; press reports said he would be given his old job back as Interior Minister.

Reactions to Chirac's declared attempt to "bring new momentum" to France ranged from dismay to ridicule.

The Socialist Party said it was cynical to appoint as Prime Minister a technocrat who has never held any elected office, just two days after the public had signalled its dislike for government by an elite.

"It's a denial of democracy," the group of Socialists in the Senate said, describing Chirac as isolated at home and in Europe and in a "bunkerised" mindset.

On the right, politicians said they saw nothing new. "The public will feel that all he's doing is to reshuffling the same old faces," sighed Maurice Leroy of the UDF, a centre-right party that refused offers of a couple of Cabinet seats.

Analysts say Chirac must move fast on the jobs front to shore up his dwindling credibility, but his choice of the aloof de Villepin, France's budget deficit and the public's distrust of reforms mean he has scant room for manoeuvre.

In Europe, meanwhile, leaders are braced for another dose of bad news - the likelihood that Dutch voters will follow their French counterparts in rejecting the constitution overnight.

EU leaders have barely two weeks before a summit to decide either to ditch the constitution or carry on with the programme to ratify it - even if to do so seems fruitless, for the document must be approved by all 25 nations to take effect.

Another possibility is to cherry-pick the constitution, implementing its proposals to streamline the central EU institutions, thus avoiding decision-making gridlock.

In the longer term, though, the EU's biggest task is to restore public faith in the glittering but controversial ideal of European integration.