Against all odds, Portugal’s centre-left Socialists won a clear parliamentary majority in Sunday’s snap general elections, securing a strong new mandate for Prime Minister Antonio Costa, an advocate of balanced public accounts.
The result, helped by a higher-than-expected turnout despite the coronavirus pandemic, comes as a surprise after the Social Democrats lost most of their advantage in recent opinion polls, and means Portugal will have a stable government that can handle the application monitored by the EU Pandemic Recovery Fund.
The vote was called in November after Costa’s hard-left former communists and left-bloc allies joined the right to cut his minority government’s budget.
The two far-left parties paid the price, losing more than half their seats, according to exit polls.
According to last week’s opinion polls, Costa himself had admitted that the Portuguese didn’t want to give him a full majority and that he was willing to forge alliances with like-minded parties, which was no longer necessary.
“An absolute majority does not mean absolute power. It doesn’t mean ruling alone. It’s an increased responsibility and it means governing with and for all Portuguese,” Costa said in his victory speech.
Before the final results were known, Costa said the party had won 117 or 118 seats in the 230-seat parliament, up from 108 in the 2019 election, and his supporters erupted in loud celebrations and chanted old revolutionary anthems Grandola and wave flags.
Steady economic growth
Costa, who came to power in 2015 after a 2011-14 debt crisis, has spearheaded a period of steady economic growth that has helped narrow the budget deficit and even managed a small surplus in 2019 before the pandemic hit.
Still, Portugal remains the poorest country in Western Europe and relies on EU funds to recover from the pandemic.
Economist Filipe Garcia, head of advisers at Informacao de Mercados Financeiros in Porto, said investors are likely to appreciate Costa’s new strong mandate given the government’s record cut in the budget deficit.
“Furthermore, the socialists will not have to make any compromises [with other parties], which guarantees stability and a clear line of action. The main challenge will be to nurture the potential growth,” he said.
According to preliminary results, the centre-right Social Democrats took a clear second place with less than 30 percent of the votes compared to around 42 percent of the Socialists.
The far-right Chega emerged as the third largest parliamentary force, jumping from just one seat in the previous legislature to at least 11.
A stable government would bode well for Portugal’s access to a €16.6 billion (Cdn 23.6 billion) package of EU aid to recover from the pandemic and its success in channeling funds into recovery projects of economic growth.
With more than a tenth of Portugal’s 10 million people estimated to be in isolation due to COVID-19, the government had allowed infected people to come out of isolation and cast ballots in person, and election officials donned hazmat suits to receive them in the afternoon.
Voter turnout was on track to surpass a record low of 49 percent in 2019.
As in many European countries, infections have increased, although deaths and hospitalizations from vaccination have been lower than in previous waves.