Lebanese Prime Minister Najib Mikati announced the resignation of his government yesterday, citing divisions on several domestic issues, and called for the formation of a national unity government.

"I announce the resignation of the government, hoping that this will open the way for the major political blocs to take responsibility and come together to bring Lebanon out of the unknown," Mikati said.

He called for the "formation of a national salvation government in which all Lebanese political forces are represented".

Mikati's decision came after disagreements on two issues, the formation of an elections supervisory commission and the extension of a security chief's mandate.

The government has held off on agreeing on the membership of the commission over fears it would ensure elections scheduled for June are held on the basis of a decades-old electoral law.

Mikati, along with the leader of Lebanon's Druze community, Walid Jumblatt, is said to favour the existing law. It gives his Sunni community and the Druze disproportionate strength in parliament, but is vehemently opposed by Lebanon's Christians.

Mikati has sought to distance his country - which fought its own 15-year civil war - from Syria's strife. But in the ex-prime minister's home city of Tripoli, two people died in clashes on Friday between militants supporting opposing sides of the Syria conflict.

Clashes erupted again on Friday night, residents said, and supporters of Mikati and Rifi blocked roads around Tripoli's main square.

A tide of Syrian refugees pouring into Lebanon and the country's own domestic turmoil have caused a sharp slowdown in Lebanon's economy and a 67 per cent surge in its budget deficit last year.-Reuters