Mexicans vote for new president, nation divided

MEXICO CITY, July 2 (Reuters) Mexicans voted for a new president today, torn between joining a resurgent left-wing camp in Latin America or sticking to pro-business policies and a close alliance with the United States.

In a country crucial to U S interests in border security, trade and immigration, polls show an extremely close race between leftist anti-poverty crusader and Andres Manuel Lopez Obrador, the former mayor of Mexico City, and conservative Felipe Calderon from the ruling party.

Lopez Obrador, 52, headed opinion polls by about only 2 points after almost six months of bruising campaigning that split a country still finding its feet with full democracy after seven decades of one-party rule ended in 2000.

The leftist, who rejects comparisons to U.S. foe Venezuelan President Hugo Chavez, promises to slash bureaucracy to pay for welfare programs he says will lift millions out of poverty.

His supporters complain that President Vicente Fox's National Action Party, or PAN, failed to live up to promises to create jobs and alleviate poverty, even though Mexico has one of the region's most stable economies.

''We are going to vote for a change,'' said car mechanic Jose Juan Bautista at a polling station in the poor town of Chalco, near the capital.

''The PAN had its chance but didn't know how to use it,'' he said as the sun rose from behind the snow-capped Iztaccihuatl volcano nearby. Food vendors sold tamales and tacos to people lined up to vote.

Former energy minister Calderon, 43, accuses Lopez Obrador of populism and says he would mire Mexico in debt.

''He is a danger for Mexico. He promises everything to everyone without explaining how he is going to pay for it,'' said waiter Hector Morgan, 20.

CLOSE RACE Another candidate, Roberto Madrazo, lags in third place but his once long-ruling Institutional Revolutionary Party, or PRI, has an electoral machinery famed for getting its supporters out to vote and he may do better than his poll numbers suggest.

Polling stations opened at 8 a.m. (9 a.m. EDT) (1300 GMT) and turnout was expected to be reasonably high, at about two-thirds of Mexico's 71 million voters.

Voting ends 12 hours later and official results are expected at 11 p.m (midnight EDT) (0400 GMT on Monday).

In a country where at least half the population lives on less than a day, Lopez Obrador has won support by promising to give pensions to those over 70 and cut energy prices.

Fox cannot run for office again under Mexican law.

Financial markets are hoping for a Calderon victory but worry that Lopez Obrador, a former Indian welfare officer with a history of organizing protests, might not accept that.

Lopez Obrador is expected to launch a legal challenge and maybe even street demonstrations if he loses by a narrow margin and suspects fraud. There is no runoff in Mexico, so whoever gains the most votes wins the election.

The United States has kept on the sidelines of the campaign, not even hinting at support for any candidate, but Calderon is more in line with U.S. views on politics and business. He would seek foreign investment in energy.

Lopez Obrador says his fight against poverty would curb illegal immigration to the United States by giving Mexicans more reason to stay home.

Today's winner will inherit a fight with drug cartels, which have carried out a wave of beheadings in the past week.

Voters will also choose federal deputies and senators and with the country split three ways, the next president is unlikely to have a majority in Congress.

REUTERS CH BST1924