In World Economy News 30/08/2016
Caretaker Prime Minister Mariano Rajoy asked the Spanish Parliament to give him a second term on Tuesday to protect the country’s economic recovery and deliver the budget adjustments that the European Union is demanding.
After two elections and an eight-month political impasse, Rajoy appealed to his opponents to step aside and allow him to govern, telling lawmakers there is no reasonable alternative to a government led by his People’s Party.
“The PP has been chosen by Spaniards as their preferred option on two occasions,” he said. “Spain urgently needs an effective government.”
Rajoy is trying to piece together the first administration since Spain’s traditional two-party system broke down with the emergence of Ciudadanos and the anti-establishment party Podemos at last December’s election. While the PP was the only group to increase its vote at a re-run in June and he has considerable common ground with the Socialists on policy, he’s struggling to clinch enough support because of unresolved corruption allegations against his party. If he fails this week, he has another two months to rustle up the votes before King Felipe has to call a third election.
Rajoy has secured support from the liberals of Ciudadanos and a lone nationalist lawmaker from the Canary Islands, giving him 170 votes in the 350-seat chamber. But with all the other party leaders opposed to Rajoy’s candidacy, the incumbent is set for defeat unless the grandees within the Socialist Party can persuade its leader, Pedro Sanchez, to back down at the last minute. Rajoy needs a majority to get through when the debate concludes on Wednesday. If he loses, a plurality will suffice at a second ballot on Friday.
The acting premier’s allies and opponents get to respond on Wednesday and then vote at the end of the day. Any attempt by the second-largest party, the Socialists, to form an alternative majority would have to rely on parties who support Catalan demands for a vote on independence, an idea which is anathema to many Socialists.
“My proposal is the only reasonable one under the current circumstances,” Rajoy said. “The alternative would be a government of a thousand colors, radical and that could put the unity of Spain at risk.”
If the parties fail to reach a settlement by the end of October, the timings set out in Spanish election law mean the next election could fall on Dec. 25. Still, a Christmas ballot would probably help the acting prime minister because PP voters have historically been more likely to turn out than supporters of other parties.
Source: Bloomberg
