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Pope Benedict XVI took the rare step of allowing Paraguay's president, former Bishop Fernando Lugo, to step down as a bishop before he assumed office August 15.

Lugo resigned as a bishop in 2006 when he decided to run for president, saying he felt unable to help the poor as a clergyman.

BBC News reports that on Monday Lugo accused retired Gen. Lino Oviedo and former president Nicanor Duarte of planning a coup to overthrow his presidency.

The Vatican had previously refused to recognize the 57-year-old's resignation, arguing that he was still a bishop since his ordination was a lifelong sacrament, and demanded that he cease all political activities.

"This is the first case within the church in which a bishop receives a dispensation," Orlando Antonini, the papal nuncio to Paraguay, was quoted as saying by Reuters. "Yes, there have been many other priests the pope has left in the status of layman, but never a member of the hierarchy until today."

Without the special dispensation, Lugo risked excommunication, since papal rules forbid priests from holding political office.

"It's a great pain for the church to lose a bishop, a priest whom we tried to dissuade from the political option up to the last day of his election campaign," Antonini said. "But the Holy Father recognized that he was elected by the majority of the people to lead Paraguay for the next five years."

Lugo began his political career in 2004 while he was bishop of San Pedro, amid widespread uprisings by peasant groups protesting against unequal land distribution and the encroachment of industrial farming.

He soon quit as bishop of the rural area, but maintained his bishop status for two more years.

As a layman, Lugo is now free to marry under civil law. But he has shown no inclination to do so. His sister, Mercedes, is serving as the country's first lady.

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BBC News has a profile of Lugo, as well as updates on his already-troubled presidency.

The Economist has further analysis of Lugo's first month in office.

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October 2008, Vol. 52, No. 10