AFP - Romanians voted on Sunday in a presidential run-off election that could end a political deadlock holding up crucial international aid to the recession-wracked EU member.

Incumbent centre-right President Traian Basescu, a former sea captain promising tough state reforms, faces Social-Democrat Mircea Geoana, an ex-diplomat who has pledged to maintain jobs and "reunite Romania" after years of political squabbling.

The two contenders, both in their fifties, finished almost neck-and-neck in the first round of voting two weeks ago, with Basescu winning 32.44 percent of ballots and Geoana 31.15 percent.

But Geoana looked to be the favourite after winning the support of the PNL liberal party, Romania's third main political force.

An opinion poll by Insomar institute published last week credited Geoana with 54 percent of the votes.

However, after a campaign dominated by below-the-belt blows, "it's difficult to say the race is over", said political analyst Cristian Parvulescu.

Basescu notably came under fire from his opponents after the release of a video apparently showing him slap a 10-year-old boy, while Geoana was accused of promising favours to a controversial business and media tycoon.

The two candidates voted in Bucharest accompanied by their family.

"I have cast my vote hoping that the end of the year will bring unity and stability to Romania and a new government," Geoana told reporters.

Whoever wins will have no time to lose in appointing a prime minister, as Romania faces Christmas in the grip of one of the most severe recessions in the European Union. The country has been led by a caretaker government since October.

The International Monetary Fund, the European Union and the World Bank, which in March agreed on a 20-billion-euro bailout plan for Romania, expect urgent steps to cut public spending as the economy shrank by 7.4 percent in the first nine months of 2009.

The winner will also face a tough battle on corruption, still widespread, according to the latest index by NGO Transparency international.

If elected, Geoana promises a new government before Christmas led by independent Klaus Iohannis. An ethnic German, Iohannis is the popular mayor of the Transylvanian town of Sibiu, the European capital of culture in 2007.

His government could count on the support of a majority of the parties in parliament.

Basescu's ruling Democrat Liberal Party (PDL) has found itself isolated following an agreement between the left-wing Social Democrats and the liberals. But he insisted the PDL would be able to find allies to form the future government.

More than 18 million people out of the 21.5 million population were eligible to vote. Balloting began at 7:00 am (0500 GMT) and was due to end at 9:00 pm (1900 GMT). Several hundred observers were monitoring the polls.

While the parties accused one another of fraud in the first round, monitors from the Organization for Security and Co-operation in Europe (OSCE) said the election was largely up to international standards.

The OSCE however noted shortcomings, such as some citizens being unable to vote before polls closed.

Exit polls were to be released on Sunday evening but the first official results were not expected before Monday morning.

Participation reached 54.37 percent in the first round, better than expected. Many Romanians are seen as disillusioned with their politicians, 20 years after the fall of Communist dictator Nicolae Ceausescu.

"I hope that someone new will emerge in five years' time because we are fed up with always seeing the same politicians," said Florica Marinescu, a Bucharest pensioner.