Romania’s Ex-Ruling Party Sweeps Election to Reclaim Power

  • Social Democrats get 45% and have majority with ally ALDE
  • Result comes a year after protests pushed out former PM Ponta

Romania’s former ruling party swept to victory in a general election, putting it on course to return to power a year after public outrage forced its prime minister out.

The Social Democrats took 45.3 percent of Sunday’s vote, while their ally, ALDE, received 5.6 percent. That gives the two parties a majority in parliament and leaves them poised to take over from the technocratic government that currently leads the European Union’s second-poorest country.

Liviu Dragnea speaks after exit polls are announced on Dec. 11.

Photographer: Daniel Mihailescu DANIEL/AFP via Getty Images

As populist waves reshape politics from Warsaw and Budapest to Washington, Romania’s election was fought on more traditional issues. Tax cuts and public-sector wage hikes championed by the Social Democrats prompted voters to look past an unprecedented crackdown on state corruption. Economic growth is the EU’s second-fastest behind Ireland, though looser fiscal policy has sparked budget concerns.

“The big question mark is whether Romania will take the same path seen in other countries in the region, when a party that wins a big majority feels it can do whatever it wants,” Cristian Pirvulescu, dean of Bucharest’s Political Science University, said by phone. “Though here the president will try to block any controversial initiatives.”

President Klaus Iohannis, formerly a member of the opposition Liberal Party, can start talks to decide on a new prime minister once final election results are announced this week. The Liberals won 20 percent in the elections, triggering the resignation Monday of party head Alina Gorghiu and other senior leaders.

The authorities’ anti-graft drive fueled support for the newly formed Save Romania Union, which promoted itself as an alternative to the current political class and got 8.9 percent of the vote. Like the Liberals, it backed Prime Minister Dacian Ciolos to stay on as premier.

Iohannis says he won’t endorse a nominee for prime minister who’s been convicted or is under investigation. That would disqualify Social Democrat leader Liviu Dragnea, who got a two-year suspended sentence in April for rigging a referendum.

‘Island of Stability’

Ex-party leader Victor Ponta stepped down as premier last November in the wake of a deadly nightclub fire that Romanians blamed on corrupt officials, and is also fighting separate graft charges. The Social Democrats plan to start coalition talks with ALDE and reveal a nominee for premier in the coming days.

“I want to assure all Romanians that everything we presented in our governing program will be put into practice by a Social Democratic-led government,” Dragnea said in televised comments, refusing to rule out his candidacy to lead the new cabinet. “Romania is an island of stability in the region, and it’s important it remains this way.”

The Social Democrats have promised additional tax cuts in 2017, as well as less bureaucracy and increased funding for health care and education in the country of 20 million people. Raiffeisen Bank International AG and Erste Group Bank AG on Monday added to concern expressed earlier by the central bank that lavish fiscal measures risk pushing the budget deficit beyond the EU limits.

For more on the Romanian election’s economic implications, click here

The sustainability of GDP growth, which reached an annual 6 percent in the second quarter, has also been questioned. The leu was 0.1 percent weaker on Monday, trimming this year’s gained against the euro to 0.3 percent.

“The election pledges, which have given Romania a consumption-based growth boom this year, are now weighing hugely on the public budget,” Alexandra Bechtel, a Frankfurt-based economist at Commerzbank AG said by e-mail.

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