Portugal picks new government with $ 50 bn of EU funds on table

Lisbon: Portuguese voters went to the polls Sunday in an early election that looked set to produce another vulnerable minority government, just as the country is poised to start spending a huge windfall of European Union funds.

That outcome would leave Portugal back where it started two months ago, when lawmakers rejected the minority Socialist government's spending bill and the country's president dissolved parliament.

The center-left Socialists and their main rivals, the center-right Social Democratic Party, were in a tight race, opinion polls suggested.

Those two parties traditionally collect around 70per cent of the vote and have for decades alternated in power in Western Europe's poorest country.

The landslide victory needed to form a majority government, which can pass most legislation despite opposition in parliament, is rare. Portugal has had just three majority governments in the past half-century.

That means one of the two main parties likely will have to form parliamentary alliances by cutting deals with smaller parties.

The stakes are high: Portugal, a country of around 10.3 million people, is poised to begin deploying some 45 billion euros (USD50 billion) of aid as a member of the EU to help spur the economy after the COVID-19 pandemic.

Two-thirds of that sum is intended for public projects, such as major infrastructure, giving the next government a financial bonanza. The other third is to be awarded to private companies.

The ballot took place amid a surge in COVID-19 cases blamed on the Omicron variant, with about 1.2 million people confined at home but allowed to go to polling stations to cast their vote.

President Marcelo Rebelo de Sousa, in an election-eve address to the nation, urged people to vote, saying it is a way of saying that ... nothing, and nobody, can silence our voice.

He said the coming years would be marked by leaving behind a painful pandemic (and) an urgent rebuilding of the economy.

Since it came to power in 2015, the Socialist Party had relied on the support of their smaller allies in parliament the Left Bloc and the Portuguese Communist Party to ensure the annual state budget had enough votes to pass.

But last November their differences, especially over public health spending and workers' rights, were insurmountable, leaving Socialist Prime Minister Ant nio Costa short of votes to pass his party's plan.

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