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UPDATE 3-Jordan swears in new reform government
* New cabinet line up seeks to broaden national appeal
* Monarch asks new premier to speed up delayed reforms
* Islamists decline offer to join gov't but give cautious welcome
By Suleiman Al-Khalidi
AMMAN, Oct 24 (Reuters) - Jordan's U.S.-backed King Abdullah swore in a reform-minded government on Monday to speed up political liberalisation after protests inspired by popular uprisings in the Arab world.
The new 30-member cabinet includes moderates, tribal politicians and technocrats. The powerful Islamist opposition declined an invitation to join but said it would support government reform moves.
Prime Minister Awn Khasawneh, a judge who worked at the Hague-based International Court of Justice, was appointed last week to replace Marouf al-Bakhit, who was widely criticised for inept handling of the crisis.
U.S.-educated former central banker Umayya Toukan was named finance minister in a move officials said aimed to allay investors' concerns about soaring public spending that has threatened Jordan's fiscal and monetary stability.
The Islamic Action Front (IAF), the political arm of the Muslim Brotherhood, said it would back Khasawneh's reformist agenda and said his overtures marked a stark contrast from successive governments that had curbed its activities.
Jordan has seen weeks of street protests led by Islamists, tribal figures and leftist opposition that have demanded wider political freedoms and that the king fight corruption.
Abdullah told Khasawneh last week that his cabinet's mission was to accelerate reforms which the outgoing cabinet had been slow in pushing through.
Abdullah told CNN in an interview released on Monday that Khasawneh had the credentials to steer the country towards national elections next year after parliament passes a package of reform laws, including a new electoral law.
"It's just if we're sincere about getting Jordan to national elections and a new phase of political life, you've got to get the right players, so this prime minister is coming in for a specific reason so that we can achieve those ends," the monarch told CNN.
Khasawneh told reporters after he was sworn in that his cabinet would open a debate over the current electoral system that favours tribal but scarcely populated regions against the heavily populated cities where most of Jordan's citizens of Palestinian origin live.
"We will also lead a public debate on the election law," Khasawneh said.
Political commentators say that as long as the electoral system does not address discrimination against citizens of Palestinian origin, under-represented in parliament and the state, real change was still a long way off.
The choice of Khasawneh was also followed by the appointment of a new intelligence chief seen as a less political figure than predecessors who had been criticised by the opposition for meddling in public life and thwarting reforms.
The monarch has said privately that the powerful security service has disregarded his calls to curb its involvement in politics. He sent its newly appointed chief Faisal al-Shobaki a rare public letter telling him his agency should not thwart reforms.
Commentators said the moves eased political tensions that had grown after recent pro-reform rallies were met with violence by members of conservative tribes and an entrenched security apparatus, raising the spectre of wider unrest.
Politicians say the monarch, who has ruled since 1999, has been forced to take only cautious steps towards democracy, constrained by the tribal power base which sees reforms as a threat to its political and economic benefits.
There has been unprecedented criticism from tribal areas that have traditionally formed the backbone of support for the Hashemite royal family and provide the bulk of manpower for the army and security forces.
The palace has so far contained tribal discontent by offering patronage, state jobs and perks but critics say this policy of placating constituents was not sustainable in a country dependent on fluctuating levels of foreign aid.
Toukan, the new finance minister, faces the task of cutting the budget deficit, expected to be around seven percent of GDP and well above an original 5.5 percent estimate for this year.
"The economic challenges to reduce poverty and ease unemployment are probably the biggest challenges we face," Khasawneh said.
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