UPDATE 2-Lebanon's Aoun invites protesters to talk, hints at government reshuffle

Lebanese President Michel Aoun said on Thursday he was ready for a dialogue with protesters to help save the country from collapse and he suggested a government reshuffle was possible.

Protests expressing outrage with a ruling elite seen as corrupt have swept Lebanon since last week, paralyzing the country despite announced reforms intended to appease discontent and win over Western donors that have pledged badly needed aid. In a televised address, Aoun promised to fight state corruption that he said had "eaten us to the bone" and assured protesters that their "shouts will not be wasted".

"I am ready to meet your representatives who carry your concerns, to listen to your specific demands," said Aoun. The protest movement has been largely leaderless and it was not immediately clear which, if any, representatives would meet with Aoun.

He said there was "a need to review the current government," hinting a reshuffle could be in the cards, but warned protesters that the system could not be changed by crowding public spaces. "We will discuss what we can do together to achieve your objectives without causing collapse and chaos, open a constructive dialogue that can lead to a constructive result, and define options that will lead to the best results."

Aoun also vowed that those who had stolen public wealth would be held to account and looted money returned. Protesters who took to the streets for the eighth day dismissed Aoun's address and said they refused to back down, saying their main demand was the resignation of the government.

Prime Minister Saad al-Hariri, whose government groups nearly all of the main parties in a sectarian power-sharing system, said he "welcomed" the call to review the current government through "constitutional mechanisms". Druze politician Walid Jumblatt called a reshuffle the "best solution" to pull the country out of crisis and said it should be followed by new parliamentary elections.

PROTESTERS REJECT SPEECH Protesters rejected Aoun's overture.

"No one can negotiate on behalf of the street. They must achieve the goals of the masses and the government's resignation is the primary demand," said Basil Saleh, 39. "The ball is rolling and it's not in favor of the government." In the speech, Aoun said he supported proposed reforms to lift bank secrecy and scrap the legal immunity of presidents, ministers, and members of parliament - legislation that could pave the way for corruption investigations.

The United States, Britain, and France have all urged Lebanon in recent days to act quickly on reforms to rein in graft and cut waste, and have expressed support for the protesters. Lebanon is hoping the reforms will convince Western donors to release some $11 billion pledged at a conference last year but contingent on long-delayed reforms.

Lebanon's economy, whose mainstays include construction and tourism, has suffered years of low growth due partly to regional turmoil, with war-torn Syria next door. Capital inflows have ebbed. In the town of Jal el Dib, protesters waving Lebanese flags brought out umbrellas and raincoats to keep protests despite the rain. Some erected makeshift barricades to block the main roadway.

"We want to tell Michel Aoun, we thought we were your sons. We waited for you eight days and today we realized it was in vain," said Salaam Zaatari, shouting into a microphone to rally a crowd of several hundred. Government measures announced this week that include halving minister salaries, taxing banks and overhauling the wasteful electricity sector have failed to defuse popular anger and have yet to prod Western donors to move forward on the pledged financing.

"That speech did not convince us at all. We've heard it a lot before. That's why we're staying here until the government falls," said Clara, a university student.

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