Which way will Lebanon go next?

When Rania Malik made a decision in 1993 to return to Lebanon after a decade of living in the United States, she did so largely because of her confidence in one man - Rafik Hariri, the billionaire property tycoon who had been appointed prime minister a year earlier.

But Mr. Hariri's murder in a massive car bomb last month and the subsequent political turmoil has made Mrs. Malik, a schoolteacher in her 30s, think long and hard about her future in this small Mediterranean country.

"I remember Hariri going on television and telling us Lebanese expatriates to come back, and we trusted him so much that we did," she says. "Now I feel like my parents did in 1975," the year civil war broke out in Lebanon. "My sense of security has gone," she adds.

Such was Hariri's larger-than-life reputation among the Lebanese, that his death has created a sense of national loss and foreboding about the future. That foreboding was reinforced by the announcement Thursday that Prime Minister Omar Karami has been renamed as premier, just 10 days after mass street protests led to his resignation and the collapse of the government.

His reappointment came after consultations on Wednesday between Lebanese President Emile Lahoud and members of the 128-seat parliament. Negotiations are under way to form a new government, although there are not many candidates for the vacancies. Some of the ministers of the outgoing government reportedly have declined to return to their posts.

Even Mr. Karami was reluctant to resume the premiership, analysts say. Karami, a relatively inexperienced politician, will be faced with balancing Syrian desires to remain a power broker in Lebanon, despite the current withdrawal of its troops, and demands from the opposition and the international community for free and fair elections and an end to Syrian domination.

"The only way to confront all the difficulties facing the nation is a government of national unity," Karami said. "If there is any procrastination in responding to this invitation, it means we're heading to destruction."

But the Lebanese opposition is refusing to participate in a new government until key demands are met, such as the removal of Lebanon's top security chiefs and the withdrawal of all Syrian forces.

"There will be a situation where a naked skeleton of security services, Lebanese and Syrian, will face a country in rebellion," says Simon Karam, a former Lebanese ambassador to Washington and an opposition leader. "The peaceful demonstrations will continue ... and we will deprive the government of any legitimacy."

But the prospect of a weak government and a continuation of the crisis spells a period of political and economic paralysis, analysts say.

Since Hariri's assassination, the Central Bank has spent some $4 to $5 billion of its $13.8 billion in foreign currency reserves to help prop up the Lebanese pound at its current rate of 1,500 to the US dollar. But in another month, the Central Bank will have to stop spending and the Lebanese pound will go into freefall, says Nicholas Photiades, a financial consultant in Beirut.

"This is the most serious crisis since the end of the civil war," he says. "If the current crisis continues and there is no solution in sight, it could be a similar situation to the civil war in the 1980s when the currency collapsed. You could see the 3,000 pounds to the dollar pretty quickly."

The rate of transfer from the local currency to US dollars has increased dramatically, Mr. Photiades says, from around a norm of 65 percent before Hariri's death to 90 percent today. "It's a genetic anxiety that was created by the civil war," he says.

But despite the unease, few Lebanese believe the country is headed toward the dark days of the civil war.

The country has changed in the 15 years since the conflict ended with a whole new post war generation having grown up. Downtown Beirut has been transformed from its war-torn shell to a city with pedestrian avenues filled with cafes, restaurants, and boutiques, attracting both Western and Arab tourists. Once condemned as the most dangerous city in the world, Beirut is now one of the safest.

Still, Lebanon remains a divided society, starkly illustrated by the recent protests for and against Syria's role here. The anti-Syrian protests are gradually losing their cross-sectarian flavor, condensing to a core of Maronite Christians, traditionally the most active opponents of Syrian hegemony.

Then on Monday it was the turn of the Shiites. A crowd estimated at 500,000 (not all of them Shiites) gathered in central Beirut in a massive display of grass-roots power organized by the Hizbullah organization to demonstrate support for Syria and a rejection of Western interference in Lebanese affairs. Many Lebanese were dismayed at the strong pro-Syria line in a speech by Sayyed Hassan Nasrallah, Hizbullah's secretary-general, fearing that it has further split the nation.

"I always had some respect for Nasrallah, but not anymore. His speech was scary," says Marwan Eid, a Maronite Christian student.

But among the Shiites of Haret Hreik, a Hizbullah stronghold in Beirut's southern suburbs, there is a different take. "The rally was a good thing and I am glad I attended," says Sami Tuhfe, who owns a mobile phone shop. "There's a very negative approach from the Western world toward Lebanon. And it must be resisted."

A poll released this week by Zogby International found that the differences in views were most pronounced between the Maronites and Shiites, with Sunni Muslims and Orthodox Christians evenly split. For example, while around 50 percent of Maronites and Druzes blamed the Syrian or Lebanese authorities for Hariri's assassination, 70 percent of Shiites pointed the finger at Israel or the US.

The poll concluded, "While an emerging consensus exists on some questions, on several key issues a deep sectarian divide still plagues the country. And these must be tended to if Lebanon's unity and internal security are to be ensured."