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Main page content: Hungarys ruling coalition edges closer to victory Christopher Condon in Budapest Published: April 10 2006 10:04 | Last updated: April 10 2006 10:04 Hungarys ruling socialist-liberal coalition on Monday looked within striking distance of retaining power, a day after forging a narrow lead in the first round of parliamentary elections. A second round will be held on April 23. ADVERTISEMENT
The chances of the conservative Fidesz party to fight back in the second round suffered a blow on Monday morning when Ibolya David, leader of the centre-right Democratic Forum, ruled out an alliance with Fidesz. The Forum provided the biggest surprise on Sunday evening by clearing the 5 per cent threshold needed to enter parliament. The party cleared the bar by a mere 2,300 votes out of a total of 5.4m votes cast. The Forum, which led Hungary's first democratically elected government after communism from 1990 to 1994, has traditionally been close to Fidesz. The parties ran on a joint ticket four years ago. But the two groups then had a bitter falling out.
On Monday, Ibolya David, the Forums leader, insisted her party would stand alone in parliament. We won't help [Fidesz] to power and we won't help [the Socialists] to power either,'' she said. Without the Forum, Fidesz would have to win approximately 75 of the 108 seats still up for grabs in the 386-seat parliament in order to reach a majority, a goal that looked unlikely but not impossible to reach. Hungarys uses proportional representation to hand out 210 of parliaments 386 seats and first-past-the-post voting in individual constituencies to award the remaining 176. Individual constituencies require a run-off if no candidate wins a majority of votes in the first round. On Sunday, the Socialists took 43 per cent of the vote, edging Fidesz, which took 42 per cent. The liberal Free Democrats, the Socialists' junior coalition partner, took 6.5 per cent. Hungarys 10m voters faced a choice between Ferenc Gyurcsany, the young Socialist prime minister who models himself on Britains Tony Blair and says the country must embrace globalisation, and Viktor Orban, prime minister from 1998 to 2002, who promises tax cuts, generous spending and a protectionist economic policy. A Socialist victory would mark the first time a post-communist government in Hungary won back-to-back terms in office. A win for Fidesz, however, would reflect growing apprehension among the EUs newest members towards continued political and economic integration. Polands minority conservative government, led by the Law and Justice party, has created controversy by seeking to block a banking merger and striking a generally anti-business tone. In Slovakia, populist party Smer is favoured to win elections set for June, a trend that has seen eastern European voters, disenchanted with the pains of economic transition, back opposition parties over incumbent administrations. Mr Gyurcsany and Mr Orban have each made lavish spending promises. Whoever wins will face an immediate test, however, in dealing with the fiscal mess created by the Socialists budget deficit. The deficit reached 6.1 per cent of gross domestic product in 2005 the highest level in the EU. The budget deficit, combined with a large current account deficit and a cooling global investment climate, has made the forint volatile in recent weeks and vulnerable to a slide against the main currencies. Polls before the election showed that two-thirds of Hungarians expect a fiscal correction after the election. Privately, both parties concede that short-term cuts and long-term plans for reform are needed. The Finance Ministry is on Monday expected to release first quarter figures for 2006. That could put new pressure on Hungarys currency, which has weakened about 6 per cent against the euro in recent weeks. Investors, analysts and EU officials have all called for budget cuts and structural reforms to modernise costly and inefficient state services. Those demands would collide with Mr Orbans campaign pledges to cut personal income taxes and social security contributions for companies, while increasing spending on healthcare, education and household energy subsidies. This is the first election since the ex-communist nation entered the European Union in 2004; turnout was 68 per cent. EMAIL ARTICLEPRINT ARTICLEMOST POPULAR
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