Former prime minister Saad Hariri was nominated Thursday to form Lebanon's next government but the process is likely to be hampered by deep differences with the powerful Hezbollah movement.

Hariri's nomination and the election of a president after a two-year vacuum have raised hopes that Lebanon can begin tackling challenges including a stagnant economy, a moribund political class and the influx of more than a million Syrian refugees.

It is also something of a comeback for Hariri, a Western-backed Sunni politician who had been left in the political cold in recent years.

Experts have cautioned that he may be hamstrung from the start because of ongoing divisions in the country's complex political scene.

But he sounded an optimistic, if solemn, tone on Thursday after accepting his nomination. 

"It is a new term," Hariri told journalists at the Baabda presidential palace, sporting his signature goatee.

He said he hoped "to form a government quickly, that will work on an electoral law that secures just representation and oversees the completion of the parliamentary elections on schedule."

Lebanon is due to hold parliamentary elections in May 2017, the first legislative vote in eight years.

The current parliament -- elected in 2009 -- has extended its own mandate twice amid fierce disagreements over revamping Lebanon's electoral law. 

- Hariri in 'tough position' -

Supporters of Hariri's Future Movement launched into spontaneous rallies in Beirut after his appointment on Thursday, waving huge sky-blue flags bearing his portrait.

Hariri is a fierce opponent of Lebanon's influential Shiite Hezbollah movement, members of which have been accused by an international court of involvement in his father's 2005 assassination.

But he was forced to throw his support behind their candidate for the presidency, Michel Aoun, in order to secure his return to power as prime minister.

In a sign that the task ahead will not be easy, Hezbollah's MPs declined to endorse Hariri for the prime minister's post, even though his nomination was all-but-assured.

Analysts said Hariri, who has seen his family fortune decline along with his influence in Lebanon's Sunni community, will have little leverage in the formation of his cabinet.

"Hariri is in a tough position," said Hilal Khashan, head of the political science department at the American University in Beirut.

"Given the economic straits he is experiencing and his declining popularity, he was determined to become prime minister, and will therefore be obliged to make concessions to preserve his interests," he told AFP.

Hariri, 46, served as prime minister under former president Michel Sleiman between 2009 and 2011, heading a unity government that was brought down by Hezbollah and its allies. 

In his new term, he is likely to struggle with his government's policy statement, which will have to make reference to Israel, as well as the war in Syria, both potential flashpoints with Hezbollah.

The powerful group has rejected attempts to disarm it, saying it serves as the "resistance" against Israel, with which Lebanon technically remains at war.

And it has also brushed off criticism of its involvement in the war in Syria, saying its forces are protecting Lebanon by fighting extremists next door.

- Restoring confidence? -

The process of forming a government could take months, with horsetrading likely to revolve around the distribution of key posts like the interior, defence and energy ministries.

"Traditionally the formation of government in Lebanon takes a long time, up to 10 months sometimes," said Khashan.  

Despite the uphill battle ahead, Lebanese are hoping the breakthrough in their country's lengthy political stalemate will revitalise the economy and solve problems like a trash collection crisis.

The country is also reeling from the effects of the arrival of more than a million Syrian refugees, who have tested the limited resources of a nation with just four million citizens.

Khashan cautioned that Lebanon would remain fragile, but central bank governor Riad Salameh sounded a note of optimism at a conference in Beirut on Thursday.

"The election of Michel Aoun should lead to the normal activity of the constitutional institutions, thus increasing confidence in economy," he said.

"The formation of a government will help in attracting foreign aid and mitigating the cost of the Syrian presence in Lebanon, which we estimate at five percent of GDP," he added.

Source: AFP