Argentina withdraws ambassador over Paraguay president's ouster

ASUNCION (Reuters) - Paraguay's new president said on Saturday he would ask his impeached predecessor to help quell regional tensions after Argentina withdrew its ambassador in protest at what it said was a coup and Brazil recalled its top diplomat for consultations.

Paraguay's South American neighbors and key trading partners are taking it to task for the unprecedented speed with which its opposition-dominated Congress removed President Fernando Lugo on Friday, saying he had failed to fulfill his duties to maintain social harmony.

A silver-haired former Roman Catholic bishop, Lugo was a year away from completing his five-year term. He decried the two-day impeachment trial but said he accepted the decision and stepped down.

He spoke to reporters outside his home on Saturday night, saying he was toppled by a "a congressional coup" and that Paraguay was now facing isolation.

The new president, Federico Franco, planned to speak to Lugo to help ease relations with other governments in the region. "I think he is the key to decompressing (the situation)."

Franco had been Lugo's vice president but was a fierce critic and his Liberal Party withdrew its support for Lugo last week, paving the way for the swift impeachment trial.

"I'm going to speak with him myself," Franco, a 49-year-old doctor, said in an interview with Reuters. He was sworn in on Friday shortly after Lugo was ousted.

The impeachment was sparked by clashes that killed 17 police and peasant farmers during a recent land eviction.

Critics of the impeachment complained that Lugo's lawyers had only a few hours to defend him in the Senate, which voted 39-4 in favor of his removal.

Argentina ordered the immediate withdrawal of its ambassador from Paraguay due to "rupture of the democratic order."

The move came a day after Argentine President Cristina Fernandez described Lugo's ouster as a coup. She also warned that measures could be adopted against Paraguay within the Mercosur trade bloc, which groups Argentina, Brazil, Paraguay and Uruguay. In theory, this could include suspension for violating Mercosur's democratic principles.

Brazil on Saturday called its ambassador in Paraguay home for consultations. It "condemned" Lugo's removal because he was not able to defend himself properly, "compromising a fundamental pillar of democracy."

Brazil's government also said democracy was essential to regional integration and must be defended. Brazil is Paraguay's top trading partner and Latin America's biggest economy.

Uruguay - another member of Mercosur - urged Paraguay to call elections as soon as possible.

Peru and Mexico also questioned the speed of the process to remove Lugo from office, although Mexico recognized the legality of the impeachment process.

FRANCO DEFENDS IMPEACHMENT

Franco defended the impeachment and said he would work to convince Argentina to reinstate its ambassador.

"(Lugo) recognized he faced a tribunal, he recognized the tribunal's verdict and finally he agreed to step down. Even more importantly, he asked for people to remain peaceful so no more blood would be shed," Franco said.

Asuncion felt oddly normal on Saturday, with businesses opening as usual and few police officers patrolling the streets a day after they clashed briefly with protesters outside Congress.

Paraguay is one of South America's poorest countries and it has a long history of political instability and military rule.

The trial's speed raised concerns throughout the hemisphere. Leftist leaders in Venezuela, Bolivia, Ecuador and Cuba said they would not recognize the new administration and vowed to lobby for sanctions against Paraguay.

Brazil, which is a strategic ally to Paraguay, said it will not respond unilaterally and will seek consensus within the UNASUR group of South American nations.

About 100,000 Brazilians live in Paraguay - a landlocked, soy-exporting nation of 6 million people - and some of them own companies, large cattle ranches or soybean farms. The two countries jointly run the giant Itaipu hydroelectric dam.

"We will make contact with neighboring countries and I'm sure they will comprehend the situation in Paraguay," Franco told reporters earlier on Saturday. "At no time was there a rupture or a coup, there was simply a change of leadership in line with the constitution and the country's laws."

(Additional reporting by Didier Cristaldo in Asuncion, Felipe Llambias in Montevideo, Tiago Pariz in Brasilia, Omar Mariluz in Lima, Armando Tovar in Mexico City and Nelson Acosta in Havana; Writing by Hilary Burke; Editing by Kieran Murray and Paul Simao)

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