South Korea's unpopular president has approached his main conservative rival to be prime minister to stem anger over his policies that have triggered mass street protests, an aide to the rival said on Wednesday.

The rallies calling for President Lee Myung-bak's ouster after barely three months in office were sparked by public outcry over a deal to open South Korea's market wider to U.S. beef and have cast a cloud over his plans for pro-business reforms.

Lee has unofficially called on Park Geun-hye, his main rival for control of the conservative Grand National Party (GNP), to be his prime minister, an aide close to Park told Reuters.

"There is a chance she could accept if a formal request is made because the situation is so difficult," said the aide, who asked not to be named.

Park, who once ran the GNP and is the daughter of an assassinated dictator, is seen as being able to unite the faction-ridden party and bring a steadying hand to Lee's government, roundly criticised for bungling the U.S. beef import deal and being out of touch with public sentiment.

"The Park Geun-hye card is an essential one to play now because nobody is trying to listen to his voice any more," said Choi Jin, the chief of the Institute for Presidential Leadership.

BIGGEST RALLY IN ABOUT 20 YEARS

In what was described by local media as the biggest demonstration in the capital in about 20 years, mothers with toddlers, college students, office workers and radical labour activists shouted "Lee Myung-bak Out" as tens of thousands marched with candles through the streets on Tuesday night.

Riot police confronted hundreds of remaining protesters at a barricade of sand-filled shipping containers that blocked the main street leading to the presidential Blue House to clear the road during the Wednesday morning rush hour.

Former construction boss Lee won the December presidential election on the strength of his can-do image.

But this has now become his liability. The public sees him as so focused on his own plans he ignores their needs, analysts say.

Political science professor Kang Won-taek said high-speed communication in the world's most wired country has allowed the anti-government message to reach wide sections of society.

"Thanks to the Internet, this has become a voluntary participation by the people that just kept evolving," Kang said.

The protests started April against a beef deal with the United States that was meant to help a separate bilateral free-trade accord. U.S. lawmakers threatened to block the pact unless South Korea opened up its market to beef imports.

But widespread South Korean concern over mad-cow disease in U.S. beef quickly turned the issue into a lightning rod for a broad range of grievances against Lee's government.

U.S. and South Korean officials have said the beef is safe but that has done little to change minds in South Korea.

The issue threatens to overshadow a visit in about a month by U.S. President George W. Bush to Seoul for talks with one of his country's major trade and military allies in Asia.

Lee's cabinet offered to resign on Tuesday to take responsibility for the fallout from the beef deal.

It has been a dizzying reversal of fortune for Lee whose margin of victory was the biggest since South Korea began open presidential elections about 20 years ago, but who now has a support rate of under 20 percent.

Helping drag it down has been increasing gloom over the fate of Asia's fourth largest economy, which Lee came to office promising to boost but who is now warning that it faces a crisis due to the soaring international prices for raw materials.

Finance Minister Kang Man-soo said that a slump in domestic demand appeared to be deepening because of high inflation.

Local media said Lee would start a government reshuffle this week and speculated he would ditch his farm, health and education ministers, along with several aides, and possibly the foreign and finance ministers.

The growing political storm has all but blocked the government's plans for major economic reform, including tax cuts, privatisation of major state-run firms and banks and efforts to make the country more accessible to foreign investment.

Truckers, who voted to strike earlier this week over high fuel prices, have stopped work in various parts of the country, dragging down transport in the export-dependent country. More labour groups might follow, which could slow production for cars and other goods.