MONTEVIDEO, Uruguay — A doctor took office as Uruguay's first socialist president yesterday, joining the ranks of left-leaning leaders in Latin America — now six in all — governing a majority of the region's people with a cautious approach to U.S.-backed free-market policies.

In one of his first official acts, Tabaré Vásquez restored full diplomatic ties with communist Cuba, more than two years after a diplomatic row divided the countries.

Thousands of Uruguayans — many waving flags and chanting "Ur-u-guay!" — filled Montevideo's streets for the inauguration of Vásquez, a 65-year-old cancer specialist whose swearing-in ended more than 170 years of power by two moderate parties.

Vásquez, elected Oct. 31 to replace Jorge Batlle, is part of a reinvigorated — but far less ideological — leftist movement in Latin America whose leaders have come to power amid economic turmoil. He took the oath of office for his five-year term with many of South America's new generation of leftists leaders looking on.

"I have not come alone," Vásquez said at the packed ceremony at Congress. "I take office as president of the republic with the support of hundreds of thousands of compatriots who expressed their democratic wishes last Oct. 31 for a better country for all Uruguayans."

Venezuela's Hugo Chávez, Brazil's Luiz Inácio Lula da Silva, Argentina's Néstor Kirchner and Chile's Ricardo Lagos all looked on as the crowd cheered.

Vásquez climbed into an antique car to leave the ceremony, then jumped onto the back of a pickup truck, blowing kisses to a crowd of thousands who turned out for a street fiesta.

Uruguay, long one of Latin America's most stable economies, is climbing out of a 2002 depression in which the economy shrank by 11 percent.

The upheaval left one of every three Uruguayans below the poverty line — a blow to a country where generous social benefits had for years assured one of the region's highest living standards.

Vásquez's victory broke a long-running hold on power by the Colorado and National parties, which alternately controlled the presidency for more than 170 years. Their dominance was interrupted occasionally by military rule, most recently during the country's 1973-84 dictatorship.

During the campaign, Vásquez pledged to help the poor, and his message resonated with voters increasingly skeptical of free-market policies being touted by Washington as the remedy for the region's economic ills.

While Vásquez has vowed to pursue moderate policies, he has promised to strengthen the country's ties with neighbors Argentina and Brazil.

In Washington, State Department spokesman Adam Ereli congratulated Vásquez on his inauguration and said the United States considers Uruguay to be "an important friend and partner."

Over the past decade, many South American countries adopted free-market reforms, opening their economies and privatizing state industries, only to see their economies slow to a grind. Unemployment rates shot into the double digits in the 1990s amid a widening gap between rich and poor.

But most analysts say the new leftists — with the exception of the more populist Chávez of Venezuela — are seeking to balance social welfare and a greater role for the state with pro-market economic policies in a mold akin to Europe's Social Democrats.

"The 'leftist' label is by now an artificial construct that should be jettisoned," Michael Shifter of the Washington-based Inter-American Dialogue wrote in a statement of leaders in Argentina, Chile and Brazil.