Saad al-Hariri has resigned as Lebanon’s prime minister, declaring he had hit a “dead end” in trying to resolve a crisis unleashed by huge protests against the ruling elite and plunging the country deeper into turmoil.

The move by the leading Sunni politician points to rising political tensions that may complicate the formation of a new government able to tackle Lebanon’s worst economic crisis since its 1975-90 civil war.

The resignation of Mr Hariri, who has been traditionally backed by the West and Sunni Gulf Arab allies, raises the stakes and pushes Lebanon into an unpredictable cycle.

Lebanon could end up further under the sway of the Iranian-backed Hezbollah, making it even harder to attract badly-needed foreign investment.

It also defies Hezbollah, which had wanted him to stay on. Mr Hariri is seen as the focal point for Western and Gulf Arab aid to Lebanon, which is in dire need of financial support promised by these allies.

Mr Hariri addressed the nation on Tuesday after a mob loyal to the Shi’ite Muslim Hezbollah and Amal movements attacked and destroyed a protest camp set up by anti-government demonstrators in Beirut.

It was the most serious strife on the streets of Beirut since 2008, when Hezbollah fighters seized control of the capital in a brief eruption of armed conflict with Lebanese adversaries loyal to Mr Hariri and his allies.

Lebanon has been paralysed by the unprecedented wave of protests against the rampant corruption of the political class.

“For 13 days the Lebanese people have waited for a decision for a political solution that stops the deterioration (of the economy). And I have tried, during this period, to find a way out, through which to listen to the voice of the people,” Mr Hariri said.

“It is time for us to have a big shock to face the crisis,” he said. “To all partners in political life, our responsibility today is how we protect Lebanon and revive its economy.”

President Michel Aoun, a political ally of Hezbollah, could now either accept Hariri’s resignation and begin consultations towards forming a new government, or ask him to rethink.

It took nine months to form the Hariri coalition cabinet that took office in January.

Some demonstrators vowed to stay in the street.

Protester Tarek Hijazi said the resignation was “a first step in building a patriotic democratic country, on the road to achieving the demands of the October 17 uprising”.

The turmoil has worsened Lebanon’s acute economic crisis, with financial strains leading to a scarcity of hard currency and a weakening of the pegged Lebanese pound. Lebanese government bonds tumbled on the turmoil.

On the streets of Beirut, black-clad men wielding sticks and pipes attacked the protest camp that has been the focal point of countrywide rallies against the elite.

Sayyed Hassan Nasrallah, head of the heavily armed, Iran-backed Hezbollah, said last week that roads closed by protesters should be reopened and suggested the demonstrators were financed by its foreign enemies and implementing their agenda.

Smoke rose as some of the protester tents were set ablaze by Hezbollah and Amal supporters, who earlier fanned out in the downtown area of the capital shouting “Shia, Shia” in reference to themselves and cursing anti-government demonstrators.

Security forces did not initially intervene to stop the assault, in which protesters were hit with sticks and were seen appealing for help as they ran, witnesses said. Tear gas was eventually fired to disperse the crowds.

Mr Hariri did not refer to the violence in his address but urged all Lebanese to “protect civil peace and prevent economic deterioration, before anything else”.

-AAP