Former union leader to be inaugurated as Brazil's 36th president

BRASILIA (Brazil) Jan 1 - Luiz Inacio Lula da Silva, who dropped out of school as a boy to shine shoes and went on to become the leader of Brazil's leftist Workers Party, was to be inaugurated Wednesday as the 36th president of Latin America's biggest nation.

Silva, 57, takes over from Fernando Henrique Cardoso in Brazil's first transition between two democratically elected presidents in over 40 years.

Silva, a one-time radical union leader who used to espouse socialism, has promised to end hunger and economic misery in a country where an estimated 50 million of the 175 million citizens live in poverty.

But he faces huge challenges: inflation that has crept into the double digits for the first time in years, and a regional economic crisis that has plunged Brazil's neighbors into financial chaos.

Brazil's currency, the real, lost 35 percent of its value against the dollar last year, in part because of investor concerns over whether Silva will keep his pledge of financing the country's large foreign debt burden or Brazil will default, as Argentina did a year ago.

People showing up to watch the ceremony said Silva is up to the job but will have a tough time keeping his campaign promises.

``I hope he's going to change things, but it's a huge challenge for him,'' said Fabiane Cristina, a 20-year-old baby sitter who lives in Brasilia.

Leaders and representatives of 119 countries - including at least seven Latin American nations - planned to attend the ceremony.

Venezuelan President Hugo Chavez arrived Wednesday morning in Brasilia, leaving Venezuela despite a crippling strike in his country that has virtually paralyzed oil production for the world's fifth largest exporter.

But the most prominent guest was Cuban President Fidel Castro, who arrived in Brasilia on Tuesday night. Castro looked healthy and in good spirits after recovering from a serious leg infection that kept him out of sight in Cuba for two weeks last month.

As he entered a Brasilia hotel, Castro waved to photographers and said that he was happy Cuba no longer holds the ``monopoly of Jan. 1,'' the day that Cubans celebrate the revolution that brought Castro to power. Silva, who is popularly known as Lula, counts Castro and Chavez among his friends

Other leaders began arriving Tuesday and Wednesday morning as tens of thousands of Brazilians swarmed to Brasilia to take part in a huge inauguration party at a vast park within view of Brazil's Congress, where Silva was to be sworn in. The United States sent U.S. Trade Representative Robert Zoellick.

By Wednesday morning, thousands of Brazilians were staking out spots to watch Silva motor to Congress in an antique Rolls-Royce down the wide Esplanada dos Minsterios, a boulevard lined with government buildings designed by a renowned Brazilian architect.

In a break with tradition, organisers set up huge TV screens in the park and a stage where Brazilian pop groups were to play after the inauguration. Hundreds of outdoor stalls sold everything from grilled pork to T-shirts and beer.

After spending 14 hours on a bus from the financial capital, Sao Paulo, musician Joao Carlos Souza stretched his legs and changed into a bright red T-shirt saying ``100 percent Lula.''

He'd never been to a Brazilian inauguration before, saying the previous events ``were for people in suits drinking champagne.''

``This time it's going to be fun to participate in history,'' Souza said. - AP