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TEGUCIGALPA (Reuters) - Honduras came under pressure on Monday to reinstate ousted President Manuel Zelaya as many Latin American leaders agreed to withdraw envoys, Washington said the ouster was illegal and protesters took to the streets.
Police in the Honduran capital fired tear gas at stone-throwing supporters of Zelaya, who was toppled in an army coup on Sunday. They arrested about two dozen people.
Some 1,500 protesters, some of them masked and carrying sticks, taunted solders and burned tires just outside the gates of the presidential palace in a face-off with security forces.
Zelaya, a leftist, was detained and sent into exile in a dispute over his push to extend presidential terms. The coup is Central America's biggest political crisis in decades.
Left-wing Latin American leaders led by Venezuelan President Hugo Chavez announced at a meeting in Managua, capital of neighboring Nicaragua, that they would withdraw their ambassadors from Honduras in protest at the coup.
Leaders from Central America, also meeting in Managua, followed suit soon after, a senior diplomatic source said.
In Washington, President Barack Obama said it would be a "terrible precedent" to move back into an era of military coups, and added the ouster was "not legal." The coup has presented Obama with a test as he seeks to mend the battered U.S. image in Latin America.
"We are very clear about the fact that President Zelaya is the democratically-elected president, Obama said, adding Washington would work with the Organization of American States and other international institutions "to see if we can resolve this in a peaceful way."
Honduras, an impoverished country of 7 million people, is a major coffee producer -- and is expected to export some 3.22 million 60-kg bags in the 2008-2009 harvest season. But there were no immediate signs that output or exports were affected as ports and roads remained open.
In Monday's protests in the capital, about two dozens protesters were arrested in scuffles as police cleared away some barricades behind the presidential palace.
"The police surrounded us. They fired gas and they started hitting everyone," said pro-Zelaya demonstrator Joel Flores, 19, who was red-eyed and said a police officer beat him on the back with a baton.
The coup followed a week of tension when Zelaya, a Chavez ally who took office in 2006, angered the Honduran Congress, Supreme Court and army by pushing for a public vote to gauge support for changing the constitution to let presidents seek re-election beyond a single four-year term.
Before he could hold the poll on Sunday, the Honduran military seized Zelaya and flew him to Costa Rica in Central America's first successful army coup since the Cold War era of dictatorships and war in the region. The Supreme Court, which last week overruled Zelaya's attempt to fire the armed forces chief, said it had told the army to remove the president.
Washington's condemnation of the coup put it in the same camp as leftist Latin American leaders such as Chavez who are often at ideological loggerheads with the United States.
Washington appeared to seek to leave a way open for negotiation.
Secretary of State Hillary Clinton said the United States viewed Zelaya's ouster as a coup but was not legally declaring this for now. Such a formal step would require Washington to cut off most aid to Tegucigalpa.
A senior U.S. official who spoke on condition he not be named said that by holding off on a legal determination on a coup, Washington was trying to provide space for a negotiated settlement.
Roberto Micheletti, named by Congress within hours of the coup as interim president until elections due in November, imposed a curfew for Sunday and Monday night. Micheletti said no foreign leader had the right to threaten Honduras.
Pro-Zelaya protesters railed against the conservative wealthy class that traditionally ran Honduras, and much of Central America, after independence from Spain in the 19th century.
"We are going to be here until President Zelaya returns. Micheletti is the president of the rich and powerful who own this country," a 22-year-old electrician who gave his name only as Kevin, said at a protest outside the presidential palace.
Zelaya met Chavez, Ecuadorean President Rafael Correa and Nicaragua's Daniel Ortega in Managua. Bolivia's Evo Morales and OAS Secretary General Jose Miguel Insulza were due to join the group for talks later on Monday.
Zelaya, 56, is a logger and rancher who was originally close to Honduras' ruling elite but then threw his lot in with Chavez's regional bloc and has steered the country leftward. His close alliance with the Venezuelan leader, and his efforts to lift presidential term limits, upset the army and the conservative elite.
Hondurans are divided over the crisis. Recent polls show support for Zelaya dropped to around 30 percent in recent months.
The country, a coffee, textile and banana exporter, had been politically stable since the end of military rule in the early 1980s. Following the coup, there was panic-buying in stores and many people drew out cash or closed businesses.
Disruption to the coffee industry is less likely because the current harvest season is drawing to a close and Honduras only has a few hundred thousand bags left to export. But the longer term outlook for the industry was more uncertain.
Honduras was a U.S. ally in the 1980s when Washington helped Central American governments fight Marxist rebels and the United States still keeps some 600 troops at a Honduran base used for humanitarian and disaster relief operations.
Additional reporting by Gustavo Palencia in Tegucigalpa, Sean Mattson in Managua, Arshad Mohammed and Matt Spetalnick in Washington; Writing by Alistair Bell, Editing by Frances Kerry