POPULIST REYES LEADS BOLIVIA VOTE - EXIT POLLS

La Paz, BOLIVIA -- A populist former army captain narrowly led Bolivia's
presidential election on Sunday, according to exit polls, while a candidate
whose defense of coca production drew a warning from the United States was
positioned to be a potential kingmaker.

Since the leader in the exit polls, Manfred Reyes, was not headed to the 50
percent needed to win outright, several other top contenders had a chance
to become president by forging alliances among newly elected legislators
before Congress meets by August 3 to elect Bolivia's new leader.

An exit poll of about 50,000 voters by the Fides media group -- which
proved accurate in previous elections -- gave 22 percent to Reyes, 46, a
former mayor, who promises more state spending to rescue one of the Western
Hemisphere's poorest nations from four years of economic slump.

Former President Gonzalo Sanchez de Lozada, 71, a pro-market reformer who
opened up Bolivia to foreign investment in the 1990s, was second with 20.9
percent.

Coca farmer leader Evo Morales, who wants to legalize the raw material used
to make cocaine and made a name for himself leading violent protests
against a U.S.-led eradication program, was in third place with 16.6
percent, becoming a possible power broker.

To the fury of many Bolivians, U.S. Ambassador Manuel Rocha warned
Bolivians last week that voting for Morales could threaten U.S. aid to
Bolivia, hugely dependent on foreign financing.

First official results are due to be released at 9 p.m. local time (0100 on
Monday).

Bolivia, a showcase of market reforms in the 1980s and a key ally in
Washington's fight against drug trafficking, has reeled from a recession
and violent protests from coca farmers, which has generated support for
Indian rights and state intervention in the economy. The landlocked nation
of 8 million people is three times the size of the United Kingdom.

"Everyone wants a fresh face in Bolivia, we all feel poorer," said Silvia,
a nurse, her skin tight and wrinkled from years in the Andean sun and wind.
She is one of the 60 percent of Bolivians who live in poverty.

Silvia voted for Morales in the remote town of Achacachi by the "holy" lake
of Titicaca, one of the highest lakes in the world, some 13,200 feet (4,000
meters) above sea level, where myth says the Inca empire was born centuries
ago.

Could Be Kingmaker

With the election headed to Congress, where a candidate must get two-
thirds of the votes to become president, Morales, 42, could have a key role
in choosing Bolivia's next leader.

Morales had a backbone of support among poor Andean Indians who live in
cold brick huts with no running water or electricity.

Cocaine production in Bolivia, once second only to that of Colombia, has
plummeted -- costing it $500 million a year in revenues and worsening the
poverty of thousands of farmers.

"The gringos must be trembling," Morales, who makes a habit of chewing coca
on the campaign trail and who has called for "Yanki" firms to be kicked out
of Bolivia, told a rally.

The country was under an effective curfew, with most travel banned. Many
Bolivians went on foot to vote, carrying babies, wrapped in multicolored
clothes against the mountain cold, on their backs.

Outgoing rightist President Jorge Quiroga will hand over power on August 6.