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By Philip Blenkinsop
BRUSSELS (Reuters) - Belgians on Friday mixed pride with trepidation over Herman Van Rompuy's appointment as the first president of the European Union because of the risk of instability after his exit as prime minister.
Van Rompuy has led linguistically divided Belgium for almost a year, in sharp contrast to the 18 months of turmoil under his predecessor Yves Leterme, the man most likely to become Belgium's next premier.
"There is a new element of fragility. Mr Leterme does not have the same confidence among French speakers as Mr Van Rompuy," said Pascal Delwit, professor of politics at the Universite Libre de Bruxelles.
King Albert spoke early on Friday to Van Rompuy, who will take up his new post at the start of January, and then began receiving party chiefs to determine the government's future. Constitutional experts wrangled over whether Van Rompuy could simply resign like any other minister or whether his departure would spell the end of his government, a prospect likely to cause disputes about posts and policy.
Belgium, like any other country, can ill afford political paralysis at a time of economic crisis, when rapid decisions are required.
During the 2007 government crisis, central bank governor Guy Quaden warned of an extra budget deficit from the stalemate and made investors attach up to 10 points of premium for Belgian 10 year bonds over German bunds. The spread is currently 38.
French-speakers in Belgium, a country of 10.6 million people, have expressed dismay at the potential return of Leterme, whose initial nine-month struggle to form a government prompted media speculation about the country breaking up.
Francophone newspaper Le Soir urged Flemish Christian Democrats two weeks ago not to choose him. "Tried already, didn't work," it commented.
In a more guarded editorial on Friday, the paper said that he and all political parties bore a duty to avoid a crisis.
Leterme pledged in the 2007 election to deliver more power to the regions -- Dutch-speaking Flanders, French-speaking Wallonia and Brussels. French-speakers fear such a move would pull Belgium apart.
The economy is likely to remain the main issue for the government, but the new Belgian premier will need to find a consensus on the powers that can be devolved and on the thorny issue of redrawing political boundaries around Brussels.
The government will hope to resolve these issues before July, when Belgium takes over the six-month EU presidency, an organisational role held by each member state in turn.
On a positive note, Leterme will inherit a government that has already resolved the budget for 2010 and 2011 and a cabinet far less divided than when he departed last December.
"Relations between the parties were very tense, but they have calmed in the past nine months. That's certainly an advantage," Delwit said.
(Editing by Matthew Jones)

Reuters