Yesterday Spaniards voted again six months after the last general elections on proposals which had changed very little; the only relevant novelty was the integration of Izquierda Unida (IU) and Podemos which in the end turned out to be irrelevant. The new/old left has not gained anything obtaining the same number of seats and votes as in December, when IU ran on its own.
Spain’s conservative People’s Party (PP) has won Sunday’s repeat general elections with 33% of votes and 137 seats. The Socialist party came second with 85 seats, while the coalition Unidos Podemos obtained an upsetting result of 71 seats and third position. Finally Ciudadanos obtained 32. These results came as a surpise as the polls had pointed to a very different outcome. But they provide an opportunity to break six months of political deadlock.
Today voters will decide which parties have a chance to decide Spain’s future government. The latest opinion polls show the right-wing Partido Popular winning the elections but in need of a helping hand from the Socialists to secure enough backing. The leftist movement Podemos emerges second in the people’s choice, with the potential to seize power if it forges a coalition with the Socialists. So once again, social democrats hold the key to government. An uneasy prospect as supporting others might wreck their future standing.
In the last few years, Spain has halved its deficit and emerged from a recession and the threat of a bailout which could have pulled all the eurozone down with it. Furthermore, it is now one of the countries with the highest growth – when the rest of the eurozone is still dragging its feet eight years after the start of the crisis – and unemployment is trending lower. But while caretaker Economy Minister Luis de Guindos keeps repeating Spain may not be sanctioned for non-compliance with its deficit target, everything indicates this will happen at the beginning of July.
Within the German government and amongst the (serious) media there is a fair amount of comprehension towards the PP government. This is in part, I suppose, because some party members have taken advantage of official contacts to explain the reforms undertaken (particularly the labour reform) and how they identify with the demands of a tough adjustment programme. Furthermore, they have no doubt offered support for German proposals within the EU or the Eurogroup
The three big electricity companies in the Ibex 35 index, Iberdrola, Fenosa Gas Naural and Endesa are holding their breath ahead of the outcome of Sunday’s general elections. The years under the PP government have been overall difficult for them and the group, also called the Oligopoly, has a list of outstanding claims and petitions for which a solution will be difficult to find if Spain’s next government is left-wing.
The fourth corner of Spain’s new political chessboard is called “Ciudadanos,” a social movement born in Catalonia 10 years ago and fostered by Catalan independence. Their slogans are: liberty, equality, laicism, bilingualism, Constitution. They elected Albert Rivera, a young lawyer from Barcelona, as their leader in a jam-packed meeting held in that city’s Tivoli theatre in July 2006.
In January 2014, dozens of people got together in the Teatro del Barrio in Lavapies, (in the centre of Madrid), to form a political party to participate in the European Parliament elections to be held in May of that year. They needed 50,000 signatures to formalise their candidacy. Within in few days, they had the signatures and the embrio of what is now (920 days later) PODEMOS was born
Fernando Rodríguez | Barely 10% of Spain’s 6 listed constructors’ business is generated at home. But problems like the recent cancellation of the real estate plan included in Madrid’s Operacion Chamartin, due to the decision of the city council which is close to Podemos, are all contributing to maintaining the generic perception that they are “Spanish companies” subject to political risk.
A favourable international situation can conceal Spain’s economy structural deficiencies. But if these were to disappear, the Spanish economy would have problems in balancing its public accounts and its financial position with the rest of the world.