By Margarita Antidze and Timothy Heritage
TBILISI (Reuters) - Georgia voted for a new president on Sunday in an election that will bring the curtain down on Mikheil Saakashvili's decade-long rule but is unlikely to end political uncertainty in the former Soviet republic.
The front-runner to replace Saakashvili, a pro-U.S. leader who has served the maximum two terms, is Georgy Margvelashvili, a member of the Georgian Dream coalition which ousted the president's cabinet in an election a year ago.
Saakashvili's departure should end feuding that has hindered policy-making and the investment climate, and cement Georgian Dream's hold on power, but the future is clouded by Prime Minister Bidzina Ivanishvili's decision to step aside as well.
The retreat of Ivanishvili, Georgia's richest man and Georgian Dream's leader, increases uncertainty in a country that is strategically important for Russia and Europe, which receives Caspian oil and gas through pipelines via Georgia.
"I'll vote for Margvelashvili of course. He's a new type of politician, a new generation," Gogi Popkhadze, 35 and unemployed, said as he voted in bright sunshine in a polling station in the centre of the capital Tbilisi.
Tsira Gabrichidze, a 68-year-old pensioner, said: "We need a balance and I think it will be good to have a president from a party that is different from the ruling coalition."
Ivanishvili, 57, has dominated politics in the South Caucasus country since entering politics two years ago, but says his job will be complete once the 45-year-old president departs.
After the election, constitutional changes take effect which will shift power from the presidency to the government and parliament. Ivanishvili has not said who will be prime minister, although no major policy changes are expected.
"This is not only a presidential election, but it's also a major change in the political system in Georgia," said Helen Khoshtaria, an independent political analyst.
CONCERNS ABOUT INSTABILITY
The arrest of several former ministers, including ex-Prime Minister Vano Merabishvili and dozens of other former officials, has caused alarm abroad, and two European Union ministers have appealed to Ivanishvili not to try to prosecute Saakashvili.
Ivanishvili denied on Friday that he would seek to jail his rival, and said he would not dictate the government's actions after he leaves office in about one month.
Opinion polls put Margvelashvili, formerly a vice premier, ahead of the two other main candidates - David Bakradze, a member of Saakashvili's United National Movement who was parliamentary speaker; and Nino Burjanadze, a leader of the 2003 "rose revolution" that ousted Eduard Shevardnadze.
The campaign, in contrast to many previous elections in post-Soviet Georgia, has been peaceful.
Margvelashvili, 44, is little known. His main foreign policy goal is to pursue close ties both with the West and with Russia - a balance the country has long failed to achieve.
He says he will refuse to take part in a run-off if he fails to win outright by securing more than half the votes.
Under Saakashvili, who rose to power after the "rose revolution", the country of 4.5 million fought a five-day war with Russia in 2008, from which Moscow emerged in control of two rebellious Georgian regions.
He won plaudits for reducing corruption and bureaucracy, and for launching economic reforms, but was criticized for not overhauling the justice system, and poverty remains a problem.
Ivanishvili's critics say the economy has deteriorated under him. After years of robust growth, gross domestic product grew only 1.5 percent in the second quarter this year, down from 8.2 percent in the same period a year ago.
Georgia allied itself with Washington under Saakashvili and pushed to join NATO, still a distant prospect. Georgian Dream has taken a similar path but sought better ties with Russia.
(Editing by Mike Collett-White and Mohammad Zargham)