Brazil's first left-wing president for 40 years, Luiz Inacio Lula da Silva, has been sworn into office amid euphoric scenes and popular expectation that he will transform the country.

I am not the result of one election, I am the result of a history Luiz Inacio Lula da Silva

Two-hundred-thousand people thronged the centre of the capital, Brasilia, for the inauguration of the former trade union leader known universally as Lula.

Leaders and representatives of 119 countries attended the ceremony on Wednesday.

Fellow leftists Cuban President Fidel Castro and Venezuela's Hugo Chavez were the most prominent guests, and are due to have breakfast with Lula on Thursday.

Legislators greeted the new leader by shouting "Ole, ole, ole, ola Lula" and singing the national anthem, after he and his vice-president Jose Alencar took the oath of office.

Lula supporters are in party mood

In his inauguration speech, Lula promised a radical change of direction.

"I am not the result of one election, I am the result of a history," he said.

"I am realising the dreams of generations and generations before me who tried and failed."

Jason Ferreira - one of the thousands who travelled to Brasilia to attend the ceremony - said: "Since 1500 an exploiting elite has governed Brazil."

"The people have dreamed of this."

Convoys of buses and cars from all over the country poured into the city throughout the day for what Lula has described as a "party for the people".

Organisers were expecting crowds of 150,000 for the inauguration.

Lula was swept into power by 61% of the electorate in October, on a promise to "transform Brazil".

Pandemonium

The new president drove to the inauguration in an open-topped Rolls Royce, waving to cheering supporters and flanked by white-uniformed cavalrymen.

Castro was one of the most prominent guests

But there was pandemonium as thousands of people broke through barriers and rushed across the grassy bank outside the parliament, the National Congress, where the inauguration was taking place.

Many watched the ceremony on large screens that had been put up around the city, despite increasingly heavy rain.

Celebrations throughout the day resembled those usually associated with Brazil's World Cup soccer victories, with well-wishers driving down the city's wide avenues honking horns and dancing in a sea of colour.

The green and yellow of the Brazilian flag mixed with the deep red of Lula's leftist Workers' Party.

Hours before the main event, pop groups staged a huge open-air concert in a park set aside for the inauguration.

Local musical superstar Gilberto Gil, who is to serve as Lula's culture minister, kicked off with chants of "Viva Lula!".

"There has never been a popular outpouring like this for a president and that is because he is a worker," 45-year-old Ana Lucia Marques da Silva, from Lula's home state of Pernambuco, told Reuters news agency.

But Lula's promise to end hunger and economic misery comes amid signs that times could get even tougher for many Brazilians.

Difficult times ahead

Shoppers have recently seen price increases for basic products such as food and fuel.

Many in Brazil are still living in poverty

In the past few weeks, Lula has taken pains to reduce expectations of an overnight change.

In a nationally televised address last week, he warned of difficult times ahead, and suggested he might not fulfil his campaign promises in his first four-year term.

Lula's presidency will end eight years of government by Fernando Henrique Cardoso.

An academic, President Cardoso has been popular for bringing a decade of unprecedented stability to a country which was a military dictatorship 20 years ago.

But our correspondent says Lula is something quite different to previous presidents, all of whom were born into privilege.

The bearded 57-year-old former metalworker grew up in poverty and made his name as a fiery union leader in the 1970s before helping to found the Workers' Party.

But now he has toned down his radical image and appealed for consensus in building a new Brazil.

In his speech, Lula promised his government would meet targets set by the International Monetary Fund, which is concerned that Brazil might default on its foreign debt.