LONDON - Mozambique's former President Joaquim Chissano, who brought peace and democracy to his country, won the first Mo Ibrahim Prize on Monday for achievement in African leadership.

Chissano wins a cash award of $5 million -- a prize intended to encourage African leaders to govern well. Former U.N. Secretary-General Kofi Annan announced the award during a ceremony in London.

"President Chissano's achievements in bringing peace, reconciliation, stable democracy and economic progress to his country greatly impressed the committee," Annan said. "So, too, did his decision to step down."

The prize was established by the Mo Ibrahim Foundation, launched last year to boost governance in Africa. The winner was selected by a committee that assessed every sub-Saharan African leader who has left office in the past three years.

Chissano is likely to come under close scrutiny from Ibrahim's detractors, some of whom accuse the former cell-phone mogul from Sudan of wasting his money trying to bribe African leaders into behaving themselves.

Chissano, who turned 68 on Monday, could not immediately be reached for comment.

He was in southern Sudan, where as a special envoy of the U.N. secretary-general, he has been mediating peace talks between Ugandan rebels and the Ugandan government, according to Yulya Vanetik, an assistant to Chissano at the U.N.'s Department of Political Affairs.

Chissano voluntarily relinquished power in 2004 after governing Mozambique for 18 years following the death of the country's first president, Samora Machel

As president, Chissano brokered a lasting peace for Mozambique's postcolonial civil war and oversaw the nation's transition from Marxism to a free market economy.

He was a former chairman of the African Union and worked to find solutions to wars in Burundi, Congo, Ivory Coast and Sudan.

Marlene Magaia, a 39-year-old bank clerk who grew up with her country at war, called Chissano "the father of the nation."

"We love him because he is a man of peace," she said.

The prize committee praised Chissano for the economic progress he brought to his southeast African nation and credited him with success in poverty reduction programs, infrastructure development and work to tackle HIV/AIDS.

But it said Chissano's role in leading Mozambique from conflict to peace and democracy was his most outstanding achievement.

"He managed to speak with (the opposition), to respect them, and to bring them to the table. That's where he showed his force of character, his leadership," said committee member Aicha Bah Diallo, Guinea's former education minister.

The prize is intended to inspire a new generation of African leaders to step forward, Ibrahim said. He noted that London and its mayor, Ken Livingstone, had recently honored South African anti-apartheid icon Nelson Mandela by erecting a statue of him in Parliament Square.

"My hope is we're going to have too many Nelson Mandelas in the 21st century," he said. "Ken, you're going to need a lot of space."