*The historic election victory of former bishop Fernando Lugo who overturned more than 60 years of conservative rule in Paraguay is another sign of the left-wing swing across South America.
"I will continue to dream of a greater Latin America, integrated and respected, without borders," Lugo told AFP Monday, a day after the 56-year-old ex-bishop won the presidency.
Lugo's victory marked the latest in a series of election triumphs by leftist, or center-left, leaders in South America.
Now, the regional trade group market Mercosur, comprising Argentina, Brazil, Uruguay and Paraguay plus associate countries Chile and Bolivia as well as Venezuela, which is in the process of joining, now is made up purely of leftist governments.
"Lugo's victory is in line with the political climate of progressive movements on the rise in Latin America," said political analyst Jorge Giacobbe in Buenos Aires.
"This is very important for Mercosur because it is always easier to develop a homogenous bloc."
Lugo, who is often called the "red bishop" or "the bishop of the poor," said days before the win that preferred the term "progressive" to "leftist" because "if you ask five people the definition of 'leftist' you get five different answers."
Critics say Lugo wants to install a "revolutionary" government in the South American country, but while Lugo admires Venezuelan President Hugo Chavez and Bolivian President Evo Morales, he aims for Paraguay to "follow its own path."
"My first measure is one that is dear to my heart: our indigenous people ... the historic debt we owe them," he told AFP. "They are the true original owners of this land."
"No more natives dying of hunger, tuberculosis or lack of medical attention," he added. "Starting now, a new era in Paraguayan politics begins."
When it comes to relations with Washington, Lugo has said confrontation is not an option and that Paraguay will maintain good relations with "everyone."
The United States said it looked forward to working with Lugo, declaring that polls from which he emerged victorious were a boost for democracy.
Nevertheless, Washington reserved comment on his prospective policies, amid perceptions by business leaders that they could be similar to those of Chavez and Morales.
"Certainly if, in fact, Mr. Lugo has been declared the winner in that election, we look forward to working with him and his new government," said US State Department spokesman Tom Casey.
Lugo defeated the ruling party candidate and ended 61 years of conservative rule as he won nearly 41 percent of the vote.
In the process, he crushed the ruling Colorado Party candidate Blanca Ovelar's dream of becoming the South American country's first woman president.
Outgoing President Nicanor Duarte on Monday told AFP he might resign before Lugo's August 15 inauguration, and take the helm of the Colorado Party. Should Duarte step down, Vice President Francisco Oviedo would take over until Lugo is sworn in.
Chavez, whose policy of nationalizing some industries has Paraguayan business leaders concerned that Lugo could follow, was among the first to congratulate the new leader, calling on him to help build "the union of South American nations."
Brazilian President Luiz Inacio Lula da Silva also hailed the election win, saying "democracy won in Paraguay, and Paraguay will make gains in its democratic process."
Lugo, while championing the rights of the poor, has highlighted his centrist tilt while seeking to overhaul a country with an annual per capita income of just 1,900 dollars and where corruption in the agriculture-based economy is pervasive.
"Paraguay is one of the countries that is the furthest behind in the region, captive to bureaucracy," said analyst Giacobbe.
"The biggest job will be to undo the system before building up a new one," he said.
Only the second unmarried president in Paraguay since 1928, Lugo said Monday his older sister Mercedes, 66, will become first lady when he takes office.
"Mercedes has always been my advisor," said Lugo, who said he was the youngest of six siblings.
"She's very hard working," he said, adding that he does not plan to move out of his home in the Lambare suburb during his mandate.

* AFP