BEIRUT - Arab League chief Amr Mussa, on a new mission to mediate a crisis between pro- and anti-Damascus forces in Lebanon, has said Syrian-backed President Emile Lahoud should serve out his term despite calls for him to go.

"(Lahoud) should remain until the end of his mandate, and his term should be respected," Mussa told the media after meeting with the embattled president Wednesday, who is under pressure from the anti-Syrian parliamentary majority to resign.

"The choice of his successor should then be made by consensus" among members of parliament, constitutionally charged with the election of the president.

Lahoud's mandate was controversially extended by three years in September 2004 after parliament, under pressure from Lebanon's then political master Syria, adopted a constitutional amendment to that effect.

His term expires next November.

Syria withdrew its forces from Lebanon last year after nearly three decades, bowing to a public outcry following the murder of former premier Rafiq Hariri.

That killing was widely blamed on Syria and its Lebanese allies, among them closed aides to Lahoud. Damascus has denied any involvement, as has Lahoud.

Parliamentary elections followed, which produced an anti-Syrian majority that has been demanding that Lahoud resign. The president, who is being boycotted by the West, has insisted he will remain in office until the end of his term.

Mussa returned to Beirut Tuesday in a new bid to find a way out of the crisis, as opposition protests calling for the cabinet's resignation entered their 19th day.

Following his talks with Lahoud Wednesday, he said "progress had been made regarding the international tribunal," a reference to the proposal for a UN-led court to try those eventually charged with Hariri's assassination. Disagreement over the court precipated the current crisis, when six pro-Syrian ministers resigned last month.

The Arab League chief stressed that "no problem is yet resolved," but that he was encouraged by his contacts because "it appears that all sides want to reach a solution."

Later, after a meeting with Prime Minister Fuad Siniora, he said he would travel to Damascus for talks on Thursday, and return the same day to Beirut.

His latest mission comes after the Hezbollah-led opposition at the weekend stepped up its campaign against the rump cabinet of Prime Minister Fuad Siniora with a call for early parliamentary elections under a new electoral law.

Previously the opposition had merely been demanding that the cabinet make way for a government of national unity.

The Arab League chief played down the likely impact on his talks of the latest opposition gambit.

"The call for early elections from the opposition will not have negative repercussions," he said.

But the government seized on the new demand as proof that the opposition was not interested in compromise.

"They forget in their enthusiasm for the idea that neither the cabinet nor parliament are under their control ... and that the necessary legislation would not be approved," Communication Minister Marwan Hamadeh said.

The top-selling An-Nahar newspaper warned that the opposition's new demands were closing off any room for compromise.

"This opposition announcement amounts to an attempt to kill off the Mussa mission," it said.

In Cairo, meanwhile, Lebanon's top Sunni Muslim cleric warned that the downfall of Siniora would lead to chaos and sectarian strife.

"There will be no other government in Lebanon and Lebanon will descend into chaos and sectarian strife if the Siniora's government falls," Sheikh Mohammed Rashid Qabbani said after meeting with Egyptian President Hosni Mubarak.

And business leaders met in Beirut to call on both side to make concessions to end the crisis.

"Each side should make concessions to get out of the current situation, and we are going to press for that, because there is no solution without dialogue," Adnan Kassar, president of the Lebanese business federation, told a conference.

Businesses in downtown Beirut are particularly suffering, as the opposition street protests have virtually paralysed economic activity in the area. -AFP