Allied with far-left, Spain's Sanchez stays on as PM

Yahoo – AFP, Daniel SILVA, January 7, 2020

Sanchez on Sunday lost a first confidence vote having failed to win backing from an
absolute majority in the 350-seat parliament (AFP Photo/PIERRE-PHILIPPE MARCOU)

Madrid (AFP) - Spain's parliament on Tuesday narrowly confirmed Socialist leader Pedro Sanchez as prime minister for another term, paving the way for the country's first-ever coalition government since its return to democracy in the 1970s.

Sanchez, who has stayed on as a caretaker premier since inconclusive elections last year, won 167 votes in the 350-seat assembly compared to 165 against, with a decisive 18 abstentions by Catalan and Basque separatist lawmakers.

He plans to form a minority coalition government with hard-left party Podemos this time around, in what would be the first coalition government in Spain since the country returned to democracy following the death of longtime dictator Francisco Franco in 1975.

Podemos' pony-tailed leader Pablo Iglesias broke into tears after the results of the vote were announced and his lawmakers chanted the party's slogan "Yes we can!".

"A period of moderation, progress and hope opens up today," Sanchez tweeted shortly after the vote

On Sunday, Sanchez lost a first attempt after falling short of the required absolute majority of 176 seats in a first confidence vote in parliament.

Spain, the eurozone's fourth-largest economy, has been in political gridlock without a proper government for most of the past year after two inconclusive elections in April and November.

Catalan tensions

Sanchez's Socialists won the November 10 poll but were weakened, taking 120 seats -- three fewer than in April -- in an election which saw upstart far-right party Vox surge into third place.

Sanchez quickly struck a deal with Podemos, which has never governed nationally, to form a coalition government despite having previously said that such a tie-up with the far-left party would keep him awake at night.

The two parties are pledging to lift the minimum wage, raise taxes on high earners and large businesses, and repeal elements of Spain's controversial 2012 labour market reforms that made it easier to fire workers -- measures which business leaders warn will hurt job creation.

With the two parties' combined total of 155 seats still falling short of a majority, Sanchez also secured the support of several smaller regional groups as well the abstention of Catalan separatist party ERC's 13 lawmakers and those of Basque separatist party Bildu's five MPs.

As part of his deal with the ERC, Sanchez agreed to open a formal dialogue with Catalonia's separatist regional government on the future of the wealthy northeastern region, and to then submit the results of the talks to Catalan voters.

The political situation in Catalonia remains in flux following a 2017 independence referendum which Madrid declared unconstitutional.

The Catalan independence push triggered Spain's most serious political crisis post-Franco.

'Worst radicals'

Spain's centre-right parties and Vox accused Sanchez of putting national unity at risk through his pact with the Catalan separatists.

The leader of the main opposition conservative Popular Party (PP), Pablo Casado, warned ahead of the vote that Spain was set to have "the most radical" government.

"Surrendering to the worst radicals may make you prime minister but you will not be able to govern," Casado said during a rare weekend session of parliament called to debate Sanchez's bid to be reappointed premier.

Sanchez's narrow margin for victory led Podemos lawmaker Aina Vidal, who is in severe pain with cancer and had to miss the weekend vote, to turn up for Tuesday's crucial session despite her illness.

"The political landscape remains tricky," ING analyst Steven Trypsteen said.

"The new government (is)... a minority government, the Catalan tensions could flare up again... and the fiscal situation makes it difficult to increase spending a lot."

Until 2015, Spain had essentially a two-party system pitting the Socialists against the PP but the rise of new parties has led to a more fragmented parliament that has made it harder to form a government.

Sanchez came to power in June 2018 after ousting his PP predecessor Mariano Rajoy in a no-confidence vote but he was forced to call elections in April after Catalan separatists including the ERC refused to back his draft budget.