Intelnote - A veteran diplomat and Arab specialist is to take the helm of French intelligence and counter-terrorism operations under reform plans to be unveiled next month, an official told AFP Monday.

Currently France's ambassador to Algiers, Bernard Bajolet, 59, was the top French diplomat in Iraq from 2004 to 2006, when he played a key role in winning the release of three kidnapped journalists.

In the newly created post of intelligence tsar, his job will be to oversee the work of the 14,000 mem-bers of the intelligence services, currently split between five agencies, according to a source close to the reform plans.

Bajolet will operate out of President Nicolas Sarkozy's offices, signalling a shift in responsibility for intelligence matters, until now overseen by a committee in the prime minister's services, to the Elysee.

Streamlining French intelligence, which is carried out by five agencies that answer to the interior and defence ministers, is one of the aims of a hotly awaited white paper on defence reform to be released next month.

The government announced last September plans to merge two of the services in a bid to improve its response to new security threats such as terrorism and economic espionage.

The new DCRI agency, described as a "French FBI", will be made up of the RG police intelligence unit and the DST counter-intelligence service.

Bernard Squarcini, the current head of the DST and a close aide to Sarkozy, is tipped to take the helm of the new agency.