Madagascar's president steps down

ANTANANARIVO (Reuters) - Madagascar's President Marc Ravalomanana handed power to the armed forces on Tuesday after a months-long power struggle with the opposition on the Indian Ocean island, officials said.

"He came to the conclusion this is best for the country. He behaved as a statesman," presidential spokesman Andry Ralijaona said of the end of Ravalomanana's seven-year rule.

Officials of Madagascar's opposition movement said their leader Andry Rajoelina, whose protests precipitated the president's fall, would lead a transitional authority.

Aides of the president said he had handed over to navy admiral Hyppolite Ramaroson, Madagascar's highest ranking officer. But the army chief of staff said the military favoured Rajoelina, 34, a former disc jockey and sacked major of Antananarivo.

"If we go with the vice-admiral we will throw ourselves into another crisis," Colonel Andre Ndriarijaona told Reuters. The head of the paramilitary gendarmerie echoed his view.

But the African Union, which had resisted any unconstitutional transfer of power, said the military should not hand over to the opposition. The European Union had warned it would cut aid to anyone coming to power by force.

Weeks of turmoil and protests in Madagascar, the world's fourth largest island, have killed 135 people, crippled the $390 million-a-year (279 million pound) tourism industry and scared foreign investors in the important mining and oil exploration sectors.

"Now the country has to convince donors that it is going back to democracy -- organising an election and putting in place a transition government," said Lydie Boka of the France-based risk consultancy StrategieCo.

ELECTION PLEDGE

Opposition officials, speaking at a ceremony when Rajoelina entered Ravalomanana's offices at a city-centre presidential palace, said they would organise elections within 24 months and re-write the constitution to create a "Fourth Republic."

With the opposition taking over his offices and most of the military against him, Ravalomanana, a 59-year-old self-made dairy tycoon, had little option but to step down, analysts said.

But Rajoelina is too young to be president, according to Madagascar's present constitution, which stipulates 40 as a minimum age. There is also disquiet around the world at the way in which he has effectively forced Ravalomanana out without recourse to the ballot box.

Aides said Ravalomanana had left his residence on the outskirts of Antananarivo and was at an undisclosed location.

The charismatic Rajoelina had called the president a dictator running Madagascar like a private firm with no concern for the poor. He tapped into widespread public discontent with high levels of poverty.

Ravalomanana's supporters had said the opposition leader was a hothead bent on seizing power illegally.

(Writing by Andrew Cawthorne; Editing by Matthew Tostevin)