A 57-year-old leftist, Lugo admitted on Monday he is the father of a toddler, confirming his relationship with a woman who is now 26 years old.

Lugo was known as the "bishop of the poor" during the 10 years he labored in a forlorn rural area of landlocked Paraguay. The president campaigned on pledges to ease crushing poverty in the South American nation, but opposition lawmaker Carlos Maria Soler said: "I hope the poverty vows the bishop took do not go the way of his chastity vows, because then we'd really be in trouble."

But while his political rivals slammed him in Congress, analysts said Lugo's roughly 70 percent approval ratings are unlikely to sink in response to the revelation. And one of his siblings, Pompeyo Lugo, defended the president's behavior to Argentine radio station Continental.

"This is the most important love story to happen in Paraguay in this century and the last one," Pompeyo Lugo said. "Love is more important than the obligation to be celibate, which is a commitment but it also punishes human nature."

A paternity suit filed by lawyers for the child's mother - who later said she had not authorized the suit - said Lugo met and seduced her when she was 16 years old and then continued a relationship with her. The legal age of sexual consent in Paraguay is 17.

Lugo shed his cassock in late 2006 to launch his political career despite opposition from the Catholic Church. After he won Paraguay's presidential vote in April of last year, the Vatican granted him an unprecedented waiver to allow him to hold the country's top political post.

The Paraguayan Episcopal Conference made a broad plea to society on Tuesday: "We ask all Catholics and people of good will to pray for us so that we may stay faithful to our priestly and episcopal mission."

President Lugo acted quickly to legally recognize his paternity. His son will turn 2 years old in May.

Photo of Lugo taken in Montevideo, Uruguay, on March 27, 2009. REUTERS/ Pablo La Rosa.

Local media reported earlier this year that Argentina might leave the post vacant after the Vatican gave a thumbs down to former Justice Minister Alberto Iribarne. The Vatican never actually rejected his nomination. It just never confirmed it, which was a clear message that he didn't have a prayer. As befits a future ambassador, Cafiero made no reference to that diplomatic faux pas.

The Roman Catholic Church does not approve of divorce and Catholics who do end their marriages are required to seek an annulment from the Church before they can remarry with the Church's blessing.

Relations with the Church were rocky under the government of Nestor Kirchner, the husband and predecessor of President Cristina Fernandez.  He criticized church complicity during the country's brutal 1976-1983 military dictatorship. And his health minister, who favored loosening restrictions on abortion, had an ugly, public spat with the bishop that tended to the country's military forces. That bishop was removed and never replaced, and rumors have abounded that the government wants to scrap the post of military bishop altogether as a way of retaliating against the Vatican.

Fernandez tried to patch up ties after taking office last December, meeting right away with the head of the Argentine Bishops' Conference.  But she stumbled when the Vatican quietly rejected her nomination of Iribarne as ambassador to the Holy See.

Guillermo Borger is the first Orthodox Jew elected to head the AMIA (Argentine Israeli Mutual Association) center in Buenos Aires, which was founded 114 years ago. Argentina's Jewish community is the largest in Latin America with nearly 200,000 members.

Borger was quoted last weekend by Argentina's biggest daily newspaper Clarin as saying he planned to "reinforce AMIA's role in representing genuine Jews." When asked what made a Jew genuine, he said: "It's having a life based on all the Torah's teachings."

Conservative and secular Jews pounced on the statement, slamming Borger's comments as narrow and discriminatory. The outgoing president of AMIA, Luis Grynwald, said he included himself among the Jews "who are not 'genuine,' and don't have a life based on what the Torah dictates," according to the Argentina-based Agencia Judía de Noticias (Jewish News Agency).

"Being Jewish is teaching my children and grandchildren the importance of inclusion, belonging, respect and honesty ... each person expresses Judaism in his own way, I do so with pride and great honor," Grynwald said.

Argentine writer Marcos Aguinis called Borger's remarks "a medieval step backward," warning that AMIA could lose members if the group's pluralistic tradition were scrapped.

Borger came out later in the week, saying he had never said anything to distinguish between genuine and "non-genuine" Jews and adding that he aimed to reinforce AMIA's role as "the representative of all Jews, without any exclusions."

"We want an AMIA for everyone that is open and pro-dialogue," he said in a statement.

Not everyone was put at ease, however, and some AMIA members led a protest against Borger's comments on Thursday. "Now they say you're not a Jew unless you're Orthodox, fundamentalist and religious ... that excludes 98.5 percent of the Jewish community," a middle-aged man told local television.

The AMIA center became international news in 1994, when a bombing there killed 85 people.

The Vatican responded by suspending him, but he remains a bishop under canon law because the Catholic Church views ordination as a lifelong sacrament.

Paraguay's bishops said they recognise the mild-mannered, sandal-wearing Lugo as the new president, adding this may be the first country where a Catholic bishop has been elected leader.

It's unclear how this might affect diplomatic relations between Paraguay and the Vatican.

"I understand this is the first time this happens and so the Pope will have to analyse this. I don't know what measure he'll take," Monsignor Ignacio Gogorza, the head of Paraguay's bishops' conference, told local radio.

Local media reported that Lugo, 56, had expressed an interest in serving as bishop again, once his presidential term ends in 2013.

"For that to happen, he'd have to pass through a period of penitence and reflection, if the Church were to accept that. If not, he'd be a suspended bishop for life," Gogorza said.

Bishop Adalberto Martinez, secretary-general of the bishops' conference, said Paraguay's bishops will continue to consider Lugo a friend after collaborating with him for 12 years.

"This is such a special and historic situation, that I think it deserves special attention from the Holy See," Martinez was quoted as saying in Paraguayan daily La Nacion.

The Paraguayan people welcomed Lugo's entry in politics since the Catholic Church is one of the most respected institutions in a country where corruption and nepotism abounds.

Thousands of Paraguayans flocked to a central square in Paraguay's capital, Asuncion, to celebrate Lugo's victory on Sunday night.

Among them was Delfina Ramirez, a Catholic nun.

"This triumph is incredible, we had been waiting for it for a long time," Ramirez said. When asked what she thought of the Vatican's opinion, she forcefully gestured with her hands as if to say: "Who cares?"

So when Fernandez took office in December, she moved quickly to patch things up. One step she took was to meet the head of the Argentine Bishops' Conference , Cardinal Jorge Mario Bergoglio, a Jesuit who ran against Cardinal Joseph Ratzinger in the 2005 papal election. However, the honeymoon didn't last long. This time the problem was with the Vatican, which effectively rejected her new ambassador to the Holy See. The candidate, former Justice Minister Alberto Iribarne, is Catholic but divorced and living with a new partner, something the Church does not approve of.

The Vatican did not reject Iribarne's nomination outright. It simply did not confirm him in the post, which in diplomatic terms means he hasn't got a prayer. Local media report that Argentina is awaiting some formal response from the Vatican, but local Church sources say that is unlikely to materialise.

Argentina is expected to leave the post unfilled for now if the Vatican doesn't unexpectedly accept Iribarne. "This issue is strictly between the Vatican and the government," a source who works at Argentina's Church offices said. "It's unfortunate that this has come up now, when we were making progress toward good relations."

The government has been reported to be considering scrapping the post of military bishop in retaliation against the Vatican. But a government source said although officials would like to eliminate the post, it was "not on the agenda" for now. All the same, the discussion was another opportunity for the Church's critics to air their complaint that some military chaplains used confessions to squeeze information out of torture victims during the dictatorship.

The Church's collaboration with the dictatorship is far from forgotten here. Last October, an Argentine court handed down a life prison sentence to a priest, former police chaplain Christian Von Wernich, convicting him of involvement in torture, kidnapping and murder during the notorious "dirty war" purge of suspected leftists.

The festival of Alasita (“buy me” in the indigenous Aymara language) combines local Aymara traditions and Roman Catholic beliefs. In keeping with its traditional roots, a shaman often blesses the trinkets with incense, flower petals and rubbing alcohol. But many participants also climb the stairs to the Roman Catholic cathedral for the blessing of Our Lady of La Paz.

Inside, men in white robes toss holy water onto people’s purchases, creating a muddy slop on the cathedral floor. The faithful throw tiny dollar bills, or bolivianos, at a flower-covered altar to the Virgin Mary. Some of them just ask that their bags of goodies be placed close to the altar for a moment, to receive her blessing.

The stalls lining the streets sell everything from teensy wads of euros to miniature diplomas for industrial engineers and gynecologists. Their tables are dotted with small pots of gold, good-luck frogs and mini-SUVs. Tiny scarecrow-like figures on display are meant to represent maids.

Two giggling young women buy rooster statues to give to one another, in the hope they'll both find boyfriends in the coming year. “That’s the tradition, that this will come true,” said Lizzette Ramos, 18.

The toy money is also used to symbolically pay off debts. Several people hand me bills, one woman to pay for life insurance, another to repay a bank loan and a third “for her trip to the United States”. After performing the ritual, an old woman in the long braids and layered skirts typical of La Paz’s indigenous population declared: “I don’t owe anything anymore!”

Bolivia’s first Indian leader, President Evo Morales, opened the main Alasita street fair on Thursday calling to the crowd: "May Ekeko give prosperity and justice to all!" An artisan gave him a statue of a hen, so he can find a partner during the coming year, and handed him another for the vice president, who is also a bachelor.

He also received a tiny version of the government’s controversial new constitution, which he hopes to implement despite stiff opposition.

Cristhiam Casazola, a 26-year-old doctor, did some shopping for his whole family, buying a basket of miniature food items and a large pot of gold, representing bounty. “I also bought some bread," he says, "because we should never be without."