Kyrgyzstan's Moscow-backed prime minister claimed victory on Monday in a presidential election tainted by charges of voting abuses and protests by defeated challengers from the restive south of the former Soviet republic.

With more than 99 percent of ballots counted, pro-business Prime Minister Almazbek Atambayev had 63 percent of the vote, an outright majority that avoids the need for a second round run-off against a potentially strong rival from the south.

Atambayev's win reinforces reforms designed to make Kyrgyzstan, a mountainous country of 5.5 million, Central Asia's first parliamentary democracy after 20 years of authoritarian rule that triggered a bloody revolution in April last year.

A trouble-free election would signal the first peaceful transfer of power in the mainly Muslim country, which lies on a drugs route out of nearby Afghanistan and hosts both Russian and U.S. military air bases.

But international observers reported cases of ballot box stuffing and vote buying, while a group of candidates vowed to challenge the result even before polls had closed on Sunday.

Atambayev's two main challengers from a field of 16 each polled just below 15 percent. Both enjoy support from Kyrgyz nationalists in the poorer south of the country which has grown since ethnic riots killed hundreds in June 2010.

About 200 supporters of third-placed Kamchibek Tashiyev, a trained boxer popular in the south, rallied for several hours in Jalalabad and blocked a major road. Dozens more gathered in Osh, the largest city in the south, before dispersing.

Tashiyev and Adakhan Madumarov, a three-times national billiards champion who was second, refuse to rule out protests.

Tashiyev, a former emergencies minister, demanded a new election. I won't calm down, he told reporters in the capital Bishkek. Voters are in place and you will hear their reaction soon.

Per capita GDP in Kyrgyzstan, at below $1,000, is less than a 10th of that in its oil-rich neighbour Kazakhstan. The economy relies heavily on remittances from migrant workers and the production of a single gold mine.

Atambayev, born in the Russian-leaning north of Kyrgyzstan, is the flag-bearer of reforms set in motion by outgoing leader Roza Otunbayeva, the former ambassador to London and Washington who became caretaker president after the revolution.

The reforms have watered down the powers of the president and established parliament as the main decision-making body, changes opposed by the prime minister's main challengers.

Kyrgyzstan doesn't need an authoritarian system. We should decide every issue together, a relaxed Atambayev told reporters. The strength of any president, of any politician, lies in having the trust of the people.

In comments sure to please Moscow, he said he did not support the presence of the base at Manas airport near Bishkek, which is used by the U.S. military to support the war in Afghanistan. The lease expires in 2014.

ELECTION FLAWS

The Organisation for Security and Cooperation in Europe's election observer mission said it was cautiously optimistic about the future of democracy in Kyrgyzstan, but noted flaws with the compilation of voter lists and tabulation.

It's disappointing that the problems on election day did not live up to the democratic promise, Corien Jonker, head of the mission of the OSCE's Office for Democratic Institutions and Human Rights, told a news conference.

Our observers reported a number of cases of ballot-box stuffing, multiple and family voting, vote buying and the transport of voters from polling station to polling station with the intention of multiple voting, she said.

The OSCE also noted positive aspects to the election: its pluralism, competitiveness and respect for fundamental freedom.

Atambayev is a popular choice among residents of Bishkek and other regions of the north. He will be allowed by the current constitution to serve a single six-year term and will appoint the defence minister and national security head.

Atambayev has shown he can work for his people and for the republic, said Turat Sheikinov, 56, chairman of an agricultural workers' co-operative. There is a person here that can attract foreign investment.

But disenchantment was evident among ethnic Kyrgyz voters in Osh. My personal opinion is that the results could not be further from the truth, said a university professor who gave his name only as Kamil.

Protesters in Osh said they would return on Tuesday to pitch tents in front of the local government building.

Unemployed ethnic Kyrgyz Nurlan Makkambai uulu, 29, said he was unable to vote for Tashiyev because his own name did not appear on the voting roll. This is just a comedy, he said.

Within the south, part of the volatile Ferghana valley where Kyrgyzstan, Uzbekistan and Tajikistan meet, voting was split roughly along ethnic lines. [ID:nL5E7LV1WC]

Many ethnic Uzbeks voted for Atambayev, believing that the prime minister's close ties with Russia were their best hope of protection from a repeat of violence.

All sane citizens want Atambayev. They don't want an ethnic feud, said Begin Tavokyalov, 48, who makes a living selling melons in an ethnic Uzbek neighbourhood of Osh.

(Additional reporting by Olga Dzyubenko; Writing by Robin Paxton; editing by Elizabeth Piper)