Archbishop Orlando Antonini, the Vatican's ambassador to Paraguay, announced that the 58- year-old president-elect had been allowed to stand down "because his clerical status is incompatible with serving as president." He added that the Church had tried to persuade him to abandon his political career "right up to the last day of the campaign."
A former missionary, Lugo was appointed bishop of Paraguay's impoverished San Pedro region in 1994. He submitted his resignation in 2006 in order to begin a political career, saying that he was unable to help the poor while working as a bishop.
Later in the year, the Vatican suspended Lugo from his religious duties due to his refusal to comply with a Vatican ban on priests entering politics. However, it refused to strip him off his bishophood, saying that ordination to episcopacy was "irreversible."
Despite this, Lugo took part in the country's presidential elections and won by wide margin to overthrow the six-decade one-party rule of the central-rightwing Colorado Party.
Paraguay's constitution also bars the clergy from the presidency and the vice presidency.
Lugo's inauguration is scheduled for August 15.
