French President Jacques Chirac has appointed Dominique de Villepin as the country's new prime minister.
The move comes as part of a cabinet reshuffle following the French government's failure to win the weekend's referendum on the proposed European Constitution.
Former French interior minister Dominique de Villepin who has been appointed prime minister by President Jacques Chirac
Mr Villepin, formerly the interior minister, replaces Jean-Pierre Raffarin, dumped after voters roundly rejected Sunday's ratification of the European Union constitution.
Mr Chirac has charged Mr Villepin (51) with the task of forming a new government, and the new prime minister arrived at the presidential Elysée Palace minutes after Mr Chirac bid farewell to Mr Raffarin with a handshake on the palace steps.
Mr Villepin was foreign minister during the Iraq war and is best known for his eloquent defence of the French stance against a US-led invasion.
The cabinet reshuffle comes as European Union leaders claimed the EU constitution remains alive despite Sunday's No vote in France.
Opinion polls in The Netherlands showed the No side broadening its lead in advance of tomorrow's referendum on the constitution and some Yes campaigners acknowledged that the vote cannot now be won.
The euro fell to its lowest level against the dollar since last October amid investors' fears that the French vote - almost 55 per cent against the constitution - could slow down the integration of Europe's economies.
European commission president José Manuel Barroso said the French vote was "a serious problem" for Europe but added that there was no appetite among EU leaders to renegotiate the treaty.
He admitted the French result could encourage voters in other countries to reject the constitution.
The Taoiseach has suggested a second referendum, as was held in Ireland when voters rejected the Nice Treaty, was possible in France.
"The French people have to consider that. That has happened in the other two precedents over the last 15 years. It was left to the member state that rejected it to deal with the issue," he said.