Yemen Suffers Power Vacuum After Leaders Quit

Small protests in Sanaa denouncing Houthis; United States expresses concern over Hadi's resignation.

SANAA, Jan 23 (Reuters) - Yemen drifted deeper into political limbo on Friday after President Abd-Rabbu Mansour Hadi resigned in exasperation at a Houthi rebel takeover of the country, a move that appeared to catch the Iran-backed group off balance.

Hadi, a former general, blamed the Houthis' control of the capital Sanaa for impeding his attempt to steer Yemen toward stability after years of secessionist and tribal unrest, deepening poverty and U.S. drone strikes on Islamist militants.

His resignation on Thursday startled the Arabian Peninsula country of 25 million, where the Shi'ite Muslim Houthis emerged as the dominant faction by seizing Sanaa in September and dictating terms to a humiliated Hadi, whom they had held as a virtual prisoner at his home residence clashes with security guards this week.

Chanting "we are the revolution", a small group of activists gathered at Change Square, the focus of 2011 pro-democracy protests which forced long-ruling President Ali Abdullah Saleh to step down under a Gulf power transfer deal.

"We're here in rejection of the events that are happening. We came out to build a state and our demand is still to have a state," said activist Farida al-Yareemi. "We went out against Ali Abdullah Saleh and he had all the weapons."

Washington, which has relied on Hadi's cooperation to stage the drone strikes on the Yemeni branch of al Qaeda, said it was concerned by the departures of the president and Prime Minister Khaled Bahah, who also quit on Thursday.

"The United States is troubled by reports of President Hadi and his cabinet's resignation," State Department spokeswoman Jen Psaki said in a statement. "At this time, it is critical that all sides avoid violence."

The Yemeni parliament is scheduled to meet on Sunday to discuss Hadi's resignation and can accept or reject it. Under the constitution, parliamentary speaker Yahya al-Ra'i, who comes from Saleh's General People's Congress party, takes office for an interim period while new elections are organised.

NO OFFICIAL HOUTHI POSITION

Some Houthi officials have welcomed Hadi's resignation but the group said an official position had yet to be taken. It urged the army to uphold its responsibilities and called on Houthi fighters to be on alert.

Witness said Houthi fighters were seen surrounding the homes of a number of senior officials from Bahah's government, including the defence minister, in Sanaa.

A senior Yemeni official said the Houthis had proposed the creation an interim presidential council to run the majority Sunni Muslim country, but an alliance of parties rejected the idea.

Hadi, who led a United Nations-backed attempt to make political reforms and bury the autocracy and graft of the past, stood down shortly after Bahah offered his government's resignation, saying it did not want to be dragged into "an unconstructive political maze".

This was a reference to a standoff between the Houthi movement and Hadi, who had been held in his residence.

On Friday, Reuters witnesses said five all-terrain vehicles belonging to the special forces were parked outside Hadi's compound. Houthi fighters were not visible inside.

Sultan al-Atwani, one of Hadi's advisers, told Reuters he had resigned after pressure and threats from the Houthis.

Late on Thursday, Houthi fighters took up positions around the parliament building, residents said.

In the southern city of Aden, three soldiers and two armed men were killed in an attack by unidentified gunmen on armoured vehicles in the early hours of Friday, local officials told Reuters. Three explosions were heard in the port city during the attack, which was followed by the clashes, said one of the officials, who declined to be identified.

The departure of Hadi, a southerner, has caused anger in Aden, where officials reacted by telling security officers to obey only orders issued in Aden, an implicit snub to institutions in the north, where Sanaa is.

Earlier in the week, Aden closed its docks briefly in protest against Houthi militia attacks on state institutions in Sanaa, calling them an "aggressive coup on the president personally and on the political process as a whole".

Hadi's decision marked an abrupt turnaround from Wednesday, when he said he was ready to accept Houthi demands for a bigger stake in constitutional and political arrangements.

By Yara Bayoumy and Mohammed Ghobari