(Adds details, schools close early, most of city affected)

By Alistair Thomson and Nick Tattersall

DAKAR, Nov 21 (Reuters) - Police fired tear gas at stone-throwing protesters who rampaged through the Senegalese capital Dakar on Wednesday, burning cars and looting government offices after authorities forcibly evicted street vendors.

Demonstrators played a cat-and-mouse game with riot police as they set fire to car tyres and rubbish, blocking main streets across much of the Atlantic coast city and forcing many businesses to close their shutters.

Several people were hurt and dozens arrested, witnesses said.

The worst riots to hit Senegal in many years erupted after President Abdoulaye Wade's government ordered police last week to move on hawkers in Dakar, where thousands of people earn a living peddling goods on the crowded streets.

After hours of disturbances, Dakar Governor Amadou Sy announced the creation of four new markets to relocate the traders, in a bid to defuse popular anger.

"People are fed up. These are youths who sell things in the street who voted the president in and now he wants to chase them away," said Ouzin Diop, 28, watching from behind the iron railings of the supermarket where he works.

"It's a long time since we've seen anything like this."

Senegal has long been regarded as a bastion of stability in volatile West Africa, but social tensions have risen due to spiralling living costs and high unemployment. This has driven thousands of young people each year to risk their lives trying to reach Spain's Canary Islands in rickety boats.

Since comfortably winning re-election in February, the octogenarian Wade has been criticised for pushing ahead with an ambitious infrastructure programme in Dakar to host an Islamic conference next year, while ignoring the plight of ordinary Senegalese, most of whom live below the poverty line.

DISTURBANCES SPREAD

Plumes of black smoke rose above the city's business district, set on the western tip of Africa's coast, as riot police pursued youths down sidestreets choked with tear gas.

Some schools told parents to take their children home early.

The riots started in the central Sandaga market area during the morning but soon spread to outlying residential quarters, with youths pelting stones at police and passing cars.

Police banned a union march in the afternoon to protest against rising living costs, blocking the four-lane Boulevard du General de Gaulle and beating protesters with rubber truncheons. Demonstrators dispersed when police fired tear gas, leaving placards scattered across the highway.

In the teeming Medina neighbourhood, rioters sacked the local mayor's office, burned cars and looted the headquarters of the national electricity company, Senelec.

"This is a popular uprising in support of the street sellers. They all have families and each one of them feeds 10 other people," said one bystander in T-shirt and jeans who gave his name as Idy.

"The population is behind them. We've had enough."

Wade ordered the clearances after meeting with business leaders who complained about working hours lost due to Dakar's congested streets, where pedestrians are forced to walk in the road due to wooden stalls blocking the pavements.

"If there were cheap markets, we would all move there," said Khadyi Tall, clutching a black plastic bag full of women's underwear. "We are tired. Today, I cannot eat because I haven't sold anything ... That's why everyone wants to got to Europe." (Additional reporting by Diadie Ba; writing by Daniel Flynn; editing by Pascal Fletcher and Giles Elgood)

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