Portugal | New minority gov’t brings political tension

Prime Minister Pedro Passos Coelho, left, and Deputy Prime Minister Paulo Portas

Stormy political times likely lay ahead for Portugal after a general election delivered a minority government.
Minority governments struggle to survive in the bickering atmosphere of Portuguese politics, and only one has ever completed its four-year term. Their average life span is 14 months.
The center-right coalition government won Sunday’s ballot despite its unpopular austerity policies and on the back of an improving economy. The Social Democratic Party and junior Popular Party collected almost 37 percent and 99 seats in Parliament, with four seats from votes abroad still to be allocated.
But the coalition will be outnumbered by left-of-center parties in the 230-seat Parliament where it is shy of a 116-seat outright majority. That means its planned financial austerity measures, including more pension cuts, and economic reforms risk being blocked.
With Portugal still recovering from its 78 billion-euro (USD88 billion) bailout in 2011, the uncertainty could consign the country to a period of political paralysis and spell another bout of market jitters over the debt-heavy eurozone country.
“The challenge begins now,” daily paper Diario de Noticias wrote in an editorial yesterday. Another paper, Publico, said the ballot “left the country in an impasse.”
The main opposition Socialist Party, a moderate center-left force that supports eurozone financial rules, came second just over 32 percent and 85 seats and could hold the key to the government’s success.

Antonio Costa, Socialist leader

President Anibal Cavaco Silva was due in coming days to invite the party with most votes to form a government. The head of state could potentially ask the left-of-center parties to take power, because together they have more seats than the incumbent government.
But there is a political gulf between the Socialists and the others. The Left Bloc, which got 19 seats, wants to renegotiate the national debt, demand better repayment terms from the country’s creditors, and end austerity measures while increasing corporate tax. The Communist Party, which captured 17 seats, wants Portugal out of the eurozone.
On top of that, Socialist leader Antonio Costa said during the election campaign he would enter into a grand coalition with the incumbent government “only if aliens land on earth.”
But on the electoral night, Costa spoke switched to a more conciliatory tone. He conceded defeat, but warned that the government must change its conduct now that it has lost its outright majority in Parliament. “The government has to understand that things are different now,” Costa said, adding that he would not seek to make the country ungovernable.
The first major test of the new political climate will come within weeks when Parliament will have to discuss the 2016 state budget.
The economy is improving, allowing the government to argue that austerity is paying off. The economy grew 1.5 percent in the first half of this year compared with the same period in 2014. The unemployment rate has fallen from a record 17.7 percent in 2013 to 12.3 percent last July.
Portugal shunned the kind of radical alternatives that have emerged in Europe in recent years, such as Greece’s Syriza and Spain’s Podemos, which have challenged mainstream parties from the far left. The Portuguese have a traditional preference for moderate parties, and voters apparently feared knocking the long-awaited economic recovery off-track. A handful of grassroots anti-austerity parties barely registered in the ballot. Barry Hatton, Lisbon, MDT/AP