By Robert H. Reid
Associated Press Writer
Monday, Feb. 28, 2000; 5:03 p.m. EST

VIENNA, Austria –– Joerg Haider, the politician known for his anti-foreigner statements and past praise of Nazi employment policies, resigned Monday as head of the far-right Freedom Party, the Austria Press Agency reported.

The agency quoted unidentified party sources attending a closed-door meeting of the group's national leadership at a downtown hotel. Party officials would not confirm the report pending a news conference expected later Monday.

APA said Haider, who holds no post in the national government, would stay on as governor of Carinthia province. The move was seen as an attempt to reduce international criticism of the new coalition government between Haider's rightists and the center-right Austrian People's Party.

The agency quoted party sources as saying Haider will be succeeded as party chief by his trusted lieutenant, Vice Chancellor Susanne Riess-Passer, 39.

APA said Haider told the party leadership meeting that he was stepping down because he did not want "to stand in the way" of the work of the new government.

The 14 other European Union members have downgraded relations with Austria because of the presence of Haider's party in the government.

Earlier Monday, Peter Sichrovsky, the Freedom Party's EU representative, said Haider had mentioned stepping down over the weekend.

"Already on Saturday, he mentioned it in an internal party discussion," Sichrovsky said. "He has already achieved more than anyone else, and if that is his decision, then we must respect it."

Despite the international furor, Haider remains popular with many Austrians and within the party he nearly single-handedly built up from a small, unknown group to the second-largest political force in the country.

"At least 50 percent of the Freedom Party is Joerg Haider," Hans Joerg Schimanek, from the Lower Austrian Freedom Party, told the Austria Press Agency. "I don't need to say anything more."

Haider has led the Freedom Party since 1986. Since last March, he has also served as governor of Carinthia province.

Sichrovsky said stepping down as party head would allow Haider to concentrate more on politics in Carinthia.

The newly elected head of the opposition Social Democratic party, Alfred Gusenbauer, however, said resigning would be merely "one of Haider's many tactical tricks" and would give the coalition a respite from criticism.