AU says could not agree on armed force for Ivory Coast, Posted by Meosha Eaton

* AU reiterates Ouattara is president-elect
* Confident of success without force * Intervention would lead to chaos, killings


By Aaron Maasho
ADDIS ABABA, Jan 29 (Reuters) - The African Union said on Saturday its decision to push for a negotiated settlement to Ivory Coast's crisis was taken after a proposal to threaten military intervention caused a divide among member states.

The Addis Ababa-based organisation announced late on Friday that it would form a panel of five heads of state to resolve the leadership crisis in the West African nation by coming up with a binding settlement within a month.

The country, the world's top cocoa grower, has been paralysed by a stand-off following a presidential election in November. U.N.-certified results showed challenger Alassane Ouattara won, but they were overturned by a legal body and the incumbent Laurent Gbagbo has resisted calls to step down.

"Africans have taken measures. They recognise Ouattara as president-elect," African Union Commission Chairman Jean Ping told reporters on the sidelines of an AU summit in Ethiopia.

But he added: "It was said that to restore peace we have to use force and that is where divergences started among Africans."

African states have been at odds over the use of force since the crisis began. Nigeria and Sierra Leone see Gbagbo's defiance as a risk to regional peace and efforts to nurture democracy.

Other countries such as South Africa and Uganda have publicly criticised the way in which the United Nations, African Union, West African regional bloc ECOWAS and other Western nations quickly recognised Ouattara as victor.

Ping said U.N. Security Council members Russia and China would have vetoed calls for military intervention had the United Nations sanctioned it, saying that would have left Africa "to do the dirty job".

"The use of force should be the last thing after you exhausted all options," he said. "If we use force in the Ivory Coast it will be chaos, killings."

SUCCESS WITHOUT FORCE
The AU's mediator Raila Odinga said on Friday that AU leaders must demand Ivory Coast's presidential rivals hold face-to-face talks to resolve the crisis.
Odinga, prime minister of Kenya, failed to make a breakthrough during two visits to Ivory Coast this month.

The crisis has raised the prospect of renewed conflict in a country divided since a 2002-2003 civil war. A subsequent ban on cocoa exports ordered by Ouattara pushed cocoa futures to one-year highs this week.

A range of sanctions has been imposed on Gbagbo and institutions supporting him in Ivory Coast, but ECOWAS military planners say they are ready to oust him if he refuses to go.

Ping expressed confidence that an agreement could be reached.
"I am convinced that we will succeed without the use of force. If we fail, it doesn't mean that we will not reconsider our position," he said.

(Editing by David Clarke)