Hidipo Hamutenya, a member of SWAPO's politburo for 30 years and foreign minister until 2004, resigned his seats on the party's central committee and in parliament earlier this month, citing the party's lack of fresh ideas and stifling of debate.

The move, coming in the wake of the formation of the Rally for Democracy and Progress (RDP) prompted speculation that Hamutenya intended to run as the new political party's presidential candidate in 2009 elections.

Analysts said the defection could be the harbinger of a political sea change in Namibia, where SWAPO has faced little opposition since leading the diamond-rich former German colony and South African protectorate to independence in 1990.

"Hamutenya's stature as a consummate SWAPO insider makes this one of the most significant political developments since 1990," said Andre du Pisani, a political analyst at the University of Namibia in the capital Windhoek.

"It has the potential to cause a re-alignment of the opposition parties ... and ... potentially could break up the SWAPO hegemony and their monopoly on power."

NUJOMA LEGACY

Namibia, rich in resources and wedged between economic powerhouse South Africa and oil-producing Angola, has enjoyed an extended period of political and economic prosperity that has made its 1.9 million people the envy of many in Africa.

But it is now struggling to maintain living standards in the face of rising poverty and unemployment and widening cracks in its once highly regarded health care and school systems.

The government of Hifikepunye Pohamba, who took over in 2005 from Sam Nujoma, the country's first post-independence president, also is under increasing pressure to embark on a bold programme of land reform to redress historical grievances.

Most of Namibia's agricultural land is in the hands of its white minority, a result of land expulsions and other policies put in place during the colonial era and South African rule.

Disenchantment with Pohamba -- a former land affairs minister expected to speed up land reform -- and divisions within SWAPO have led to speculation that Nujoma, who is still party president, could return to lead it in the 2009 elections.

That would set the stage for a battle between the former guerrilla and independence hero and Hamutenya, who was fired after he questioned Nujoma's increasingly autocratic control over the party and his choice of Pohamba as successor.

"FLAG OF HOPE"

But the jury is still out on whether Hamutenya and a new political party have the muscle to take on SWAPO.

"It is a flag of hope in an otherwise depressing political landscape," said Carola Engelbrecht, a former parliamentarian and ex-secretary general of the opposition Republican Party.

"But we want to see what their ideology will look like and who the leadership will be before we offer unqualified congratulations."

Hamutenya's position could be strengthened in the coming weeks if other key SWAPO officials, including possibly the country's prime minister, also decide to jump ship from the ruling party, which begins a key congress on Nov. 27.

Prime Minister Nahas Angula has not been nominated for a senior party post at the congress, fuelling speculation that he will also leave SWAPO and possibly join forces with Hamutenya.

SWAPO has responded by demanding that key officials take loyalty oaths to the party.