Protesters in the French-Caribbean island of Guadeloupe have set buildings and cars on fire and clashed with police as strikes over pay and high prices crippled the island.

Thousands of tourists have also fled the island and neighbouring Martinique after four weeks of demonstrations.

Late on Monday night police fired tear gas at protesters in Guadeloupe's largest town, Pointe-a-Pitre, as they set fire to roadblocks, while gangs looted shops, smashed storefront windows and set fire to two buildings.

"It is a political crisis, an institutional crisis and we are on the brink of sedition," Victorin Lurel, Guadeloupe's regional council president, told France-Info radio on Tuesday.

However, Elie Domota, a leader of the Collective Against Exploitation, or LKP, the group of unions and political parties organising the strikes, accused France of "repression", local newspapers reported.

Calm urged

France, which administers both islands, has urged "calm, responsibility and restraint", with Michele Alliot-Marie, the French interior minister, saying she hoped talks with the protesters, which had broken down, would resume.

Paris has refused to accede to strikers' demands for a raise of $250 a month for low-wage workers who now make about $1,130 a month.

On Tuesday business leaders in Martinique agreed to a 20 per cent price cut on most supermarket products, despite initially rejecting the demand.

Behind much of the unrest in Guadeloupe and Martinique is anger within the local Afro-Caribbean community - many of whom are descendants of slaves brought to the island by France - that the vast majority of wealth and land remain in the hands of colonists' descendants.