ISLAMABAD (AFP) - Pakistan President Asif Ali Zardari steps down on Sunday having defied expectations by holding onto power for a record five years, but facing criticism for leaving the economy and security in a shocking state.

Never popular and always shrouded in controversy, Mr Zardari - once jailed for 11 years for alleged corruption - relinquishes power for a new life likely to be split between Pakistan and Dubai.

Six years after his wife, two-time prime minister Benazir Bhutto, was murdered, he retires having presided over the only civilian government in Pakistan history to complete a full term in office and hand over to another at the ballot box.

His successor is Mr Mamnoon Hussain, a businessman and close ally of Prime Minister Nawaz Sharif whose low-key persona and lack of personal power base puts him in stark contrast to Mr Zardari.

"Politicking, keeping diverse groups together, that's one of his achievements," political analyst Hasan Askari told AFP of Mr Zardari, 58, who had to deal with a fractious ruling coalition and a divided Pakistan People's Party (PPP).

Another achievement was facing down a zealous judiciary.

Furious that judges sacked under military rule in 2007 were not immediately reinstated when Mr Zardari took power, the courts pursued him.

The Supreme Court convicted of contempt and sacked his first prime minister for refusing to ask Switzerland to reopen multimillion-dollar corruption cases against Mr Zardari.

"I have not seen any Supreme Court in the world trying to put its sitting president on trial in a foreign country," said Mr Askari. "He survived that. He's a big survivor." Allies praise the outgoing Parliament for passing more legislation than any of its predecessors, including laws empowering women against domestic violence and sexual harassment.

In 2010, Mr Zardari relinquished much of his power to the prime minister, rolling back on decades of meddling by military rulers in an effort to institutionalise parliamentary democracy.

But critics say he showed no leadership in the face of economic decline and spiralling insecurity, laying accusations of poor governance and rampant corruption at his door.

"Continuity is a positive development in a country like Pakistan where political leaders don't last long. Other than that there is no achievement you could really highlight," said Mr Askari.

Mr Sharif has inherited a surge in terrorist attacks. Shootings and bomb attacks are now a daily reality.

Nothing has been done to eliminate the plethora of militant networks blamed for violence in Pakistan, Afghanistan and India.

Religious violence has reached dizzying levels with the Shi'ite Muslim minority bearing the brunt.

Meanwhile Karachi, Pakistan's largest city and its business hub, is suffering from record killings linked to political and ethnic tensions.

Sharif has made his top priority resolving a chronic energy crisis and trying to revive the economy.

He was left with no option but to secure a US$6.7 billion loan from the International Monetary Fund to reduce a fiscal deficit that neared 9 per cent of gross domestic product last year.

Mr Zardari spoke of the need for reconciliation at a farewell lunch hosted for him by Sharif, which earnt plaudits from commentators praising the dignity of the handover.

"Today we need reconciliation. Everyone needs it, so we have to work together under your leadership. We will strengthen our country. We cannot afford divisions," Mr Zardari said.

"It is a question of our future generation. History will not forgive us if we do not realise the situation and the threats (Pakistan faces). We have to save Pakistan from future threats."

Aides deny that Mr Zardari, unpopular and divisive within the PPP, will spend most of his time abroad and insist that he will base himself in Pakistan and immerse himself in trying to revive the party.

The centre-left PPP ran a rudderless general election campaign earlier this year and has been thrust into its greatest crisis, suffering a crushing electoral defeat without a true leader.

His son Bilawal is chairman, but can only run for Parliament after he turns 25 on Sept 21, and is seen by many observers as a reluctant heir to the legacy of his assassinated mother Bhutto.

His younger sister Aseefa publicly registered to vote this week and some observers believe she has more of the charisma and political hunger needed to replace her mother.

Mr Zardari's spokesman Farhatullah Babar told AFP that Mr Zardari will relocate to Lahore "to start yet another chapter in political struggle" and analysts suggest he will try to revive the party dominated by the Bhutto-Zardari family.

He is due to vacate the presidency for the last time on Sunday to a guard of honour. Mr Hussain is to be sworn in on Monday.