Belgium seeks new PM to steer it out of crises

Belgium sought a new leader on Monday to steer it out of both a political and economic crisis, although there was little sign that rival parties could agree who should take the top job, reported Reuters.

Belgium plunged into its third political crisis in a year on Friday when Prime Minister Yves Leterme's government collapsed due to a Supreme Court report on political meddling in a legal case over the rescue of stricken bank Fortis.

Leterme ruled out a return to office on Sunday, leaving the five coalition parties scrambling to find a successor.

Jean-Luc Dehaene, who led Belgium from 1992-1999, emerged on Monday as the most likely candidate to head an interim government until June 2009, when parliamentary elections could be held to coincide with planned regional and EU votes.

"I think there's a high chance that it will be Dehaene," said Carl Devos, political scientist at Ghent University. "He has the experience, he's been prime minister, and would be an effective crisis manager."

The new leader would have plenty on his plate.

Belgium, host to NATO and the European Union, is expected to slide into recession this quarter and urgently needs to enact a 2 billion euro ($2.8 billion) recovery package and a deal on wages, as well as find a solution to the Fortis debacle.

Fortis investors, whose shares have dropped to around 1 euro from almost 30 euros in April 2007, have successfully challenged the group's state-led break-up and asset sale to France's BNP Paribas and argue now that the deals should be renegotiated.

However, the Flemish liberals have reservations over 68-year-old Dehaene, who became chairman of Fortis rivals Dexia after the Franco-Belgian group's bailout in October, arguing that he is too left-wing.

Other possible successors include the president of the lower house of parliament, Herman Van Rompuy, Guy Verhofstadt, the former prime minister brought back by the king last year, and outsiders Finance Minister Didier Reynders and Marianne Thyssen, head of the Flemish Christian Democrats.

Belgium has lurched from crisis to crisis since the June 2007 general election, mostly due to Leterme's failure to broker a deal between Dutch-speaking parties that want more powers for Flanders and French speakers who fear such a move would pull Belgium apart.

Previous crises sparked media speculation that the 178-year-old nation could break in two. The devolution issue is set to flare up again, especially approaching June elections.

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