Spain election: Tough talks ahead after historic result

Spain’s political parties are facing a struggle to form a stable government after a historic election that broke the traditional two-party dominance.

The incumbent conservatives took most votes, but the surge of two new forces stripped it of its majority.

King Felipe VI will now talk to all parties before nominating a candidate for PM, who must then win a vote of approval in the hung parliament.

The uncertainty prompted a fall on Monday in the Madrid stock market.

Shares on the Ibex 35 fell 2.8% in early trading, before recovering slightly.

For decades the conservative Popular Party (PP), now led by incumbent PM Mariano Rajoy, and the Socialists (PSOE) had dominated the Spanish political scene.

But a surge of support for the anti-austerity Podemos party and the centrist Ciudadanos has broken the mould.

The PP took 28.72% of the vote in Sunday’s election, the PSOE 22.01%, Podemos 20.66% and Ciudadanos 13.93%.

In the 350-seat parliament this translates to: PP (123); PSOE (90); Podemos (69); Ciudadanos (40).

Mr Rajoy’s immediate reaction was to insist his party was “still the number one force” and he would attempt to form an administration.

Socialist leader Pedro Sanchez was equally adamant that Spain wanted “a move to the left”, although he acknowledged that Mr Rajoy had won the right to have the first attempt at forming a government.

This is the beginning of a new, multi-party era in Spain. The unrivalled dominance of the PP and the Socialists, who alternated in power for 32 years, always with parliamentary majorities, is over.

Compromise and co-operation, so fundamental in Spain’s transition to democracy at the end of the 1970s, but generally absent in much of the political discourse since, will have to become the new watchwords of Spanish politics.

A PP-led government, or one led by the Socialists, will require long and complicated negotiations.

The new parties, particularly Podemos, would surely demand radical changes in the way Spain is governed and in economic policy, before risking being a junior partner in any government.

The figures show that finding any workable administration could be a tough task.

An alliance between the PP and the liberal Ciudadanos would not provide enough seats for a majority. But an alliance of the PSOE and Podemos would fall similarly short.

Nevertheless, both Podemos and Ciudadanos were celebrating their performances.

At a press conference on Monday, Podemos leader Pablo Iglesias hailed its successes and said he would now meet with allies to decide how to proceed. He said he would hold talks with all the political groupings but that these had not yet started.

But he insisted Podemos would “not allow the PP to govern”. He also said those who were talking of a “grand coalition” between the PP and the Socialists had failed to recognise Spain was no longer a two-party system.

Echoing this, Ciudadanos deputy leader Jose Manuel Villegas said: “The two ancient parties, the old left and the old right, won’t have power anymore.”

The spotlight could fall on the six smaller groupings, who took 28 seats.

The biggest of these is Erc-Catsi, the Catalonian separatists, with nine seats, but there are other regional separatists from the Basque Country and the Canary Islands.

Joining forces with Mr Rajoy might seem unlikely, given he has called regional separatism the biggest threat to Spanish unity in decades.

In line with the Spanish constitution, after talking to each party, the king will nominate a candidate for prime minister. This cannot take place until after the new Congress holds its inaugural meeting on 13 January. The nominee must then win a vote of confidence in parliament. If this fails, another candidate can be nominated and seek parliamentary approval.