Madagascar's president isolated but defiant

ANTANANARIVO (Reuters) - Presidential guards and hundreds of supporters on Tuesday protected Madagascar's leader Marc Ravalomanana who is vowing to fight to the death if pro-opposition soldiers try to drive him from power.

Weeks of opposition protests and turmoil on the Indian Ocean island have killed 135 people, crippled tourism, scared foreign investors in the mining and oil exploration sectors, and left Ravalomanana's grip on power looking very tenuous.

Opposition leader Andry Rajoelina's bid to force him out, however, is stirring some disapproval from foreign powers who want to avoid yet another violent transfer of power in Africa.

While the continent has seen big democratic advances in recent times, events like last year's coup in Mauritania and election violence in Kenya, plus this month's murder of Guinea-Bissau's president, have reminded Africans of the instability and dangers still lurking.

"I am worried we are descending into civil war. Each side is calling on their supporters," said Victor Razafindratsima, crowding round a newspaper kiosk with other anxious residents of the capital Antananarivo.

On Monday, Madagascar's traditionally neutral army threw its weight behind opposition leader Rajoelina and stormed a presidential palace in the heart of Antananarivo.

The army also seized the central bank.

Tanks and scores of soldiers guarded the buildings on Tuesday. Though bracing for possible violence, Malagasy still sought to go about their business, with schools staying open and some people opening shops and going to work as normal.

COUP?

Rajoelina, a 34-year-old former disc jockey and sacked mayor of Antananarivo, has been calling for Ravalomanana's resignation since the start of 2009 and now wants him arrested. He calls the president a dictator running Madagascar like a private firm.

Rajoelina was scheduled to appear at another opposition rally later on Tuesday.

Ravalomanana, 59, is holed up in another presidential palace on the outskirts of the capital, with supporters forming a human shield on roads outside.

The president, who himself came to power after eight months of unrest following a disputed 2002 election, has offered a referendum and says he will not leave by non-democratic means.

"This is becoming a military coup," said presidential spokesman Andry Ralijaona. "The presidential guard told him he should be placed elsewhere, and he replied, 'I will die with you if I have to'. That's his stand."

Rajoelina says he is impatient to take office and has set up his own parallel administration, but his push for power is complicated by fear of alienating foreign powers.

While presenting himself as a reformer and democrat, Rajoelina is trying to force his opponent out without a vote.

The African Union (AU), whose next summit was scheduled to take place in Madagascar, has condemned the "attempted coup d'etat" in Madagascar. The European Union has said it will cut aid and shun anyone coming to power by force.

The outside world is astonished by the rapid turn of events in Madagascar, driven, it seems, by Rajoelina's personal determination to topple Ravalomanana as fast as possible.

The charismatic Rajoelina, who is given to sweeping statements and demands, has led protests since the start of 2009, tapping into public discontent with the levels of poverty.

The president's supporters say Rajoelina is a troublemaker bent on seizing power illegally.

Analysts thought Rajoelina may have over-played his hand by claiming he was Madagascar's de facto leader early on in the crisis, but the balance of power appears to be swinging his way.

The army chief of staff says 99 percent of soldiers are behind Rajoelina, though the president says significant sections remain with him. One senior military source, who asked not to be named, said Ravalomanana had asked two army loyalists to take over the presidency, but both had declined.

A solution is needed fast, diplomats say, to prevent further bloodshed and save an economy whose $390 million-a-year tourism sector is collapsing.

(Writing by Andrew Cawthorne; Editing by Dominic Evans)