April 17, 2024

Vote in Finland Could Doom Economic Bailout of Portugal

With all ballots counted, the biggest winner was the conservative National Coalition Party, part of the outgoing center-right government and a strong advocate for European integration.

But its main ally, the Center Party, led by Prime Minister Mari Kiviniemi, said it would drop out of the government after falling behind two opposition parties that have challenged bailouts of euro zone countries: The anti-immigration True Finns do not believe Finland should rescue Europe’s “squanderers,” while the Social Democrats have called for changes to how those countries are financed.

The outcome means that the National Coalition leader, Jyrki Katainen, will have to invite at least one of the parties to coalition talks, raising questions about Finland’s support for rescue packages that need unanimous approval in the 17-member euro zone.

“This result will give Europe gray hairs,” said Olavi Borg, a political analyst. “It will cause them problems over the bailout funds.”

If any country pulled out, the system would crash, leading to a worsening of the debt crisis at a time when the group is deciding whether bailouts will end with Portugal or will also be needed for larger economies like Spain’s or Italy’s.

The conservatives won 20 percent of the vote, for 44 seats in the 200-member Parliament, 2 more than the Social Democrats. The True Finns soared to 39 seats from 6. The results were preliminary and needed to be confirmed by electoral committees by Wednesday.

“We can work with any party, as long as the election result and government program make it possible,” said Mr. Katainen, the National Coalition leader.

Asked if he could strike a deal with the True Finns on aid to Portugal, Mr. Katainen said, “When responsible people sit at the table and discuss matters with Finland’s interests at heart, then solutions always will be found.”

Article source: http://www.nytimes.com/2011/04/18/world/europe/18finland.html?partner=rss&emc=rss

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