Portugal goes to the polls Sunday with voters set to give their verdict on four years of austerity by either re-electing the centre-right coalition that steered the country through a punishing bailout or turning to the Socialists who promise to ease painful reforms.
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Portugal is one of the eurozone’s smaller economies, representing less than 2 percent of the 19-nation bloc’s gross domestic product.
That has not stopped the affable former mayor of Lisbon from vowing to lift the country off its knees in the same way as he raised spirits in the capital, moving his office into the drug and prostitution-infested Mouraria area when he first came to power in 2007.
The economy is now recovering.
The jobless rate has since fallen to 12 percent from a peak of 17.
Analysts warn Portugal risks a period of political instability just as it seeks to safeguard an economic recovery after emerging from a debt crisis.
He too made an election-night hint at compromise, saying he would still fight to “end the chapter of austerity” but would not threaten Portugal’s commitments towards its creditors.
At the heart of the campaign is one word: austerity. Both Spain’s Prime Minister Mariano Rajoy and Irish premier Enda Kenny face elections within months, and are fighting off insurgent parties demanding a reversal of tax increases and spending cuts.
A government collapse and new elections within the next four years can not be ruled out, said Federico Santi at Eurasia group.
Another big victor was voter apathy, with provisional figures suggesting a record 44.42 per cent of abstentions among the more than 9.6 million people eligible to vote.
Similar measures have brought a backlash against governments in other Eurozone countries, and Portugal also witnessed large street protests and numerous strikes.
“I voted for those in power”. They say they are committed to the euro currency and its budget discipline.
“We’ll have a minority government that will make agreements in crucial moments like passing budgets”.
Portugal’s parliament has 230 seats, meaning at least 116 are needed for a majority. A grand coalition is unlikely.
A few 15 percent of voters were still undecided according to opinion polls on Friday.
President Anibal Cavaco Silva must name the new prime minister after talking to all political leaders with discussions likely to start later this week and take around two weeks.
Coelho’s victory follows on the heels of Greek Prime Minister Alexis Tsipras re-election last month, after the anti-austerity crusader agreed to worldwide demands in return for more aid.
While Passos Coelho can point to renewed if modest economic growth, he was badly damaged by a controversy over his failure to pay social security contributions for five years – a situation he claims he has since put right.
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The opposition leader and the Socialist Party leader Antonio Costa speaks with reporters after the official results of the elections in Portugal were announced on Sunday.
