Portugal prime minister says ready to form new govt without majority

The Portuguese started to casting their ballots on Sunday in the general elections, the first after the country had a clean exit from an worldwide bailout in May previous year.

All signs are pointing to a second consecutive election win for Portugal’s conservative Portugal Ahead coalition.

The result shows European leaders who impose painful economic reforms as the price for remaining in the euro can overcome the anti-austerity vote – the case of Greece’s reluctant reformer Alexis Tsipras last month, and now Portugal’s Passos Coelho.

Sunday’s victory by the centre-right, after four years of swingeing austerity that sent unemployment and emigration soaring, marks a rare case of a bailed-out country re-electing its government.

The leader of the Socialist Party Antonio Costa accepted defeat at close to 11 p.m., but highlighted that the Social Democrat’s loss of a majority in the Portuguese parliament would clearly change the dynamics of the country’s politics.

“In contrast to the relative stability that has characterised Portugal in the last four years, the political backdrop is set to deteriorate”, said Antonio Barroso, an analyst at Teneo Intelligence in London.

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. Smaller, leftist parties made up the rest.

A handful of grassroots anti-austerity parties have barely registered in opinion polls. It climbed above a coalition led by the Portuguese Communist Party on 6 percent.

The centre-right governing coalition has vowed to continue austerity policies in place since 2011, after it was forced to seek a eurozone bailout.

Mariana Mortagua, the 29-year-old rising star of the radical left, may have called a few of Portugal’s most powerful bankers to account for their part in plunging the country into crisis, but her party is unlikely to rock the political boat in this election. The government says the budget deficit will fall below the EU’s 3 percent target this year.

Passos Coelho campaigned on his record of having returned the country to fragile growth after one of the worst crises in its history, warning that the opposition Socialists could undo the progress.

To reassure voters, Socialist leader Costa, 54, has had to distance himself from Socrates, who served as premier from 2005-2011.

It needs 116 for an absolute majority.

In an attempt to head off the critics, Costa – who likes to relax by doing 1,000-piece jigsaw puzzles – has produced costings of his campaign promises including a return to a 35-hour week for public servants and a rise in the minimum wage.

Moderate mainstream parties were expected to triumph in Portugal’s general election Sunday, after more radical alternatives failed to exploit public discontent over austerity measures.

“I’m in a state of shock”, Ana Gomes, a Socialist member of the European Parliament told RTP.

“We will inform the president of the republic that we are ready to form a government”, Passos Coelho said, adding that the make-up of the new parliament would “demand greater efforts from all of us”.

This article was updated to reflect the near-complete vote count.