By Layli Foroudi

PARIS (Reuters) -Sports teacher Benjamin Belaidi held a banner reading "no justice, no peace" as he marched in memory of the teenager shot dead by French police, weary of what he described as repressive policing and an absent state in city suburbs.

The 38-year-old Belaidi, who grew up in one of the low-income housing estates that ring France's towns and cities, was among thousands who marched peacefully to denounce what many in the "banlieues" say is a culture of police violence and systemic racism within law enforcement.

"They are not 'guardians of the peace', they don't even enforce order - they enforce disorder," Belaidi said, reflecting the view of many around him.

The fatal shooting of the teenager, who was of North African descent and has been identified as Nahel M., in the western Paris suburb of Nanterre has unleashed three nights of violent unrest across France.

The events have plunged President Emmanuel Macron into the gravest crisis of his leadership since the Yellow Vest protests that started in 2018.

Rioters have torched cars and public transport but also targeted town halls, police stations and schools - buildings that represent the French state.

"WE ARE NOT SCUM"

For Mohamed Jakoubi, who watched Nahel grow up as a child, the rage on the street is fuelled by a sense of injustice in the banlieues after incidents of police violence against minority ethnic communities - many of whom are from former French colonies.

"We are fed up, we are French too. We are against violence, we are not scum," he said, listing the towns that had seen deaths at the hands of the police in recent years.

At the march for Nahel, participants decried what they called the longstanding neglect of suburbs, while their anger towards the police pointed to a breakdown in trust between their communities and law enforcement.

They chanted "justice for Nahel" and "police assassin". Some said Nahel, who was shot dead on Tuesday, could have been any of them, or their sons, brothers or friends.

A video shared on social media, verified by Reuters, shows the moment a police officer shot at Nahel at close range as he drove his car away against orders from a traffic stop. He died shortly afterwards from his wounds.

The officer faces charges of voluntary homicide.

The national police and Paris police did not respond to Reuters requests for comment.

Yann Bastiere, a representative of the Unite SGP police union, said the officer who shot Nahel was innocent until proven guilty. He had stopped the teenager because he was not respecting the highway code, not because of his appearance or ethnic origin, Bastiere said.

"The police is a reflection of our society, it is multi-ethnic, and there is racism like in society," he said.

But he acknowledged a breakdown of trust, which he attributed to government policies that focused police action on intervention and repression and removed resources from prevention and neighbourhood policing.

Karima Khatim, a politician from Blanc Mesnil, a northeastern suburb of Paris which also saw unrest following the shooting, said the video "saved Nahel's honour".

"If it weren't for the cameras we would have played on his profile, oh he was at the police station before, oh he has a dodgy past - no, it was a 17-year-old that was killed by the police," she said.

Despite increased state investment in these poor areas, "rather than close the gap with the rest of France, unemployment, deprivation rates and schooling success have remained flat or got worse since the 1990s," said Emile Chabal, a reader in history at Edinburgh University.

Investment aimed at urban renewal was ramped up following unrest in 2005 that lasted three weeks.

However, said Chabal, "there is a feeling that there has been a form of window-dressing - fancy buildings, shiny trams - that has not brought real results or tackled the structural issues that residents face everyday e.g. racism, access to the labour market."

POLICY FAILINGS

Olivier Klein, minister for housing and former mayor of Clichy-sous-Bois, told France Inter on Friday that some of the places damaged this week had been built or renovated thanks to the urban renewal policies.

"We are doing things, but a resentment remains because in these neighbourhoods there is a feeling of being discriminated against," he said.

At a meeting at the prime minister's office on Thursday evening, it was decided that as well as restoring calm it was necessary to step up urban renewal in the 1,500 most sensitive neighbourhoods, a spokesperson said.

Belaidi said teachers were not replaced and hospitals lacked resources, which has led to a feeling of abandonment by the state.

"There is a complete desertification of the estates. The police is the only state service that is left," he said.

(Reporting by Layli Foroudi; additional reporting by Elizabeth Pineau; Editing by Angus MacSwan)