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ANALYSIS-Portugal vote points to centre-right, still uncertain

Source: Thomson Reuters Foundation - Fri, 27 May 2011 13:48 GMT
Author: Reuters
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* Polls indicate advantage to main opposition party

* Analysts do not rule out surprises

* Number of undecided voters still very high

By Axel Bugge

LISBON, May 27 (Reuters) - Portuguese opinion polls still do not show a clear winner at next month's election but analysts say the centre-right opposition should win sufficient votes to be able to form a majority government.

The snap election on June 5 is crucial for Portugal's economic future as the next government will have to enact the tough austerity plans included in a 78-billion-euro bailout agreed this month with the European Union and IMF.

A weak, or minority government after the election could make it considerably harder for the heavily-indebted country to introduce austerity plans and explains why the EU and IMF insisted on cross-party support for the bailout before signing off on it. Failure to meet fiscal goals could ultimately mean the lenders cut off the cash transfers.

It was the collapse of Portugal's last minority government due to its inability to pass austerity measures that sparked the sharp rise in borrowing rates that ultimately forced Lisbon to seek a bailout, like Greece and Ireland before it.

Most opinion polls in recent weeks have indicated an advantage to the main opposition, the centre-right Social Democrats (PSD), although a couple have put the ruling Socialists even at around 36 percent. [ID:nLDE74O0HG]

But when the support of the small, rightist CDS, the Social Democrat's traditional ally in government, is included the odds swing in the opposition's favour.

"In truth, if you look at all the polls together, they show a small advantage for the PSD," said Pedro Magalhaes, a political analyst at the University of Lisbon. "The most likely scenario is a coalition government between the PSD and CDS."

Socialist Prime Minister Jose Socrates, whose government has remained in a caretaker capacity since he resigned in March, retains support from core Socialist voters, and his popularity has been only marginally hit by the dire economic situation.

But analysts say Socrates has appeared tired during parts of the campaign, especially during a television debate with PSD leader Pedro Passos Coelho last week, undermining some of his strong campaigning skills.

Socialist Party president Almeida Santos said in an interview on Friday in the weekly Sol that Socrates would step down as party general secretary if he lost the election.

CAN'T RULE OUT SURPRISES

Political analyst Viriato Soromenho Marques agrees that the Social Democrats have the advantage going into the last week of the campaign. But he does not rule out surprises.

"It is still possible that the Social Democrats lose the advantage that they have," said Marques. "People are very sensitive, any small thing could change matters."

For instance, Passos Coelho reopened a debate this week about abortion despite the fact that a referendum a few years ago legalised it in this predominantly Catholic country. Marques said that could have unpredictable consequences as feelings about the abortion issue are still strong.

Uncertainty surrounding the election is especially high as politicians have tried to avoid, as much as possible, discussing the fact that the bailout will impose severe restrictions on the country in the next few years.

Portugal is already in recession and is expected to contract again next year, unemployment is at its highest since the early 1980s and is likely to rise further, and disposable income is set to fall as taxes are raised more under the bailout terms.

That has led many Portuguese to simply switch off -- the number of those undecided is still very high in this country which has one of the highest abstention rates in western Europe.

"I can't see a solution in sight to our country's problems," said Cristina Sanches, an assistant in the Supreme Court, taking a bus on her way to work.

"Socrates is a good politician, has a huge marketing machine behind him, but he is a liar. Passos has no experience or enough legitimacy to become prime minister."

So far, the growing dissatisfaction with the main parties has not translated into sharp gains for smaller parties, but it is still a possibility as voters make up their minds in the last week of the campaign.

"I have not decided yet but for the first time in 35 years I am not going to vote for the Socialists nor the Social Democrats," said Joao Ferreira, a 48-year-old pharmacist.

(Additional reporting by Daniel Alvarenga and Andrei Khalip)

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