You are here
Portugal prime minister re-elected as socialists solidify position
[LISBON] Prime Minister António Costa of Portugal won Sunday's national election, as voters rewarded his Socialist party for returning the country to robust growth and budgetary health.
The Socialists appeared likely to fall short of a majority of the 230 seats in parliament. But their margin of victory gave Mr Costa plenty of leeway to negotiate an alliance with smaller parties, like the one that brought him unexpectedly into office four years ago.
The Socialists won about 37 per cent of the vote, according to preliminary results, with about two-thirds of the votes counted.
In 2015, Mr Costa lost the election, but ended up becoming prime minister anyway after persuading two smaller left-wing parties to back him. At the time, the alliance was ridiculed as a "geringonça" or "contraption", that his opponents said would fall apart in no time.
Four years later, the "geringonça" label has been worn as a badge of honour by Mr Costa. He has become a rare thing in Europe — not only a Socialist head of government, but one who has overseen a solid economy, helped by tourism and foreign investors, and proved wrong the critics who had long caricatured the left as incapable of fiscal discipline.
Mr Costa, 58, had been leading in the polls long before the voting Sunday, making a Socialist victory appear as almost a foregone conclusion.
Still, as results trickled in Sunday, they suggested a resounding defeat for the prime minister's centre-right opponents. They had maintained that Mr Costa was doing little more than taking the credit for an economic recovery that he did not engineer. They argued that it was instead rooted in earlier spending cuts and reforms imposed by international creditors in granting a bailout of 78 billion euros (S$118 billion), to Portugal during the financial crisis.
In late 2015, Mr Costa promised to put an end to the austerity of the bailout programme. But instead, he showed himself to be a firm believer in fiscal discipline, even squeezing investment in sectors like healthcare to bring Portugal close to a balanced budget.
The deficit has been cut from 7 per cent of gross domestic product in 2014 to 0.4 per cent at the end of last year. And the Portuguese economy has outpaced most of its European partners, while unemployment has almost halved, to just under 7 per cent.
"Costa was somewhat lucky — Portugal had exited the bailout programme, there was a boom in the tourism industry, the economy started to grow — but he also made his luck," said Eunice Goes, who is Portuguese and a professor of politics at Richmond University in Britain.
Portugal now stands out as an example of stability in Europe, while its fiscal turnaround has won plaudits internationally. In 2017, Mr Costa's finance minister, Mário Centeno, was elected president of the Eurogroup, the body of finance ministers that shapes policy within the eurozone.
Mr Costa's apparently smooth run toward re-election was recently shaken by a scandal involving his former defense minister, José Alberto Azeredo Lopes, who was indicted last month on charges of covering up the theft of grenades and other weapons from an army depot in June 2017.
But that scandal pales in comparison with the fraud accusations that dogged the previous Socialist prime minister, José Sócrates, who is awaiting trial on charges of fraud and money laundering. Both Mr Azeredo Lopes and Mr Sócrates have denied wrongdoing.
Mr Costa is a former mayor of Lisbon, which has been transformed by an influx of overseas tourists and investors, many of whom have become residents of Portugal to benefit from tax breaks offered to foreigners.
But the revamping of ancestral buildings in Lisbon and other cities has also pushed up property prices and raised the debate over growing wealth inequality, particularly as Portugal prepares for a broader European economic slowdown, with Germany standing on the brink of recession.
"Portugal looks great now to those who come from outside, but our health system has never been worse, the new jobs come with rubbish salaries, and our politicians continue to get caught up in scandals," said Vasco Farias, a 56-year-old civil engineer.
Mr Farias was among the roughly 46 per cent of voters who stayed away from the polling stations, resulting in what preliminary results indicated was one of the lowest election turnouts since Portugal's return to democracy in the 1970s.
This year, fuel truck drivers held major strikes that forced Mr Costa's administration to take emergency measures, while nurses and other health care workers also protested their work conditions.
The labour unrest strained relations between Mr Costa and his two left-wing partners, who accused him of turning Portugal into a European poster child of fiscal discipline instead of investing more in public services.
Depending on the election results, Mr Costa could now try to form his next government with different allies, including perhaps the support of a party that defends animal rights. That party made some of the biggest gains Sunday.
The political stability in Portugal contrasts with the uncertainty in neighboring Spain, where Pedro Sánchez, the caretaker Socialist prime minister, faces a repeat election in November after months of fruitless negotiations to get voted into office by parliament.
Mr Sánchez praised Mr Costa and his Portuguese model in a recent autobiography. But Mr Sánchez has so far failed to replicate the formula.
After winning a Spanish election last April, he feuded with Spain's other left-wing party, plunging Spain into a new period of uncertainty. Next month, Spain will hold its fourth national election in four years.
Addressing his supporters shortly after midnight, Mr Costa said his Socialist victory would reinforce "the political stability that is essential for international confidence in Portugal". Portuguese voters, he said, had given him a fresh mandate to negotiate another governing alliance, but "now with a stronger Socialist party".