Friday, December 5, 2008

Romanian Liberal Democrats Win Most Parliament Seats

By Adam Brown and Irina Savu

Dec. 4 (Bloomberg) -- Romania’s Liberal Democratic Party won the most seats in Nov. 30 parliamentary elections, putting it ahead of the rival Social Democratic Party, which led in the popular vote, the electoral bureau said.

The Liberal Democrats secured 115 seats in the 334-member lower house while the ex-communist Social Democrat Party will have 114, Central Electoral Bureau President Stefan Ciontu said at a news conference in Bucharest today.

The result, which took into account factors including population differences between regions, signal tougher talks to form a governing coalition in coming days or weeks after the Social Democrats took 34.2 percent of the popular vote in Nov. 30 elections, compared with 33.6 percent for the Liberal Democrats.

“Right now there is a huge question mark over Romania,” Theodor Stolojan, the prime ministerial candidate for the Liberal Democrats, said today. “We need talks to form a strong majority to show inside and outside of the country that we have a strong government with the ability to lead.”

Both parties are now forced to court the National Liberal Party, led by outgoing Prime Minister Calin Tariceanu, to form a government coalition. The Liberals came in third, with 18.6 percent of the popular vote and 65 seats.

National Liberals

The National Liberal Party is the only party in a position to give a majority to one of the top two vote-getters. The ethnic- minority Democratic Union of Hungarians in Romania won 6.2 percent of the vote and 22 seats, according to the electoral bureau.

In the 137-seat Senate, the Liberal Democrats took 51 seats, while the Social Democrats won 49, the National Liberals have 28 and the ethnic Hungarian party garnered nine seats.

The 18 million eligible voters in the Black Sea nation of 22 million were asked on Nov. 30 to vote for the party they thought best able to shield them from the effects of the global economic crisis hammering emerging markets.

Romania’s leu has weakened more than 7 percent against the euro and more than 20 percent against the dollar in the past year as international investors withdraw money from countries seen as carrying a higher investment risk. The benchmark BET stock market index has declined about 67 percent at the same time.

President Traian Basescu, who has the right to name a premier, today called all parties to talks at the presidential palace starting at 10 a.m. tomorrow to discuss forming a new government. He also called for the new Parliament to convene for the first time on Dec. 15.

Basescu. 57, has said he would not approve his arch-rival, Tariceanu, 56, or Social Democrat leader Mircea Geoana, 50, as premier. Basescu, who faces presidential elections in July, favors the Liberal Democrat’s Stolojan, 65, to become premier.

Stimulus Package

Meanwhile, the fate of a 10 billion-euro ($12.6 billion) economic stimulus proposed last month by the outgoing government is uncertain. Any new government can change or scrap the program, which was meant to take effect in January.

After years of growing prosperity that lured fresh investments from companies including Carrefour SA, Ikea, Starbucks Corp., Nokia Oyj, and Ford Motor Co., the government predicts economic growth will slow next year by as much as half.

In the past two months, companies including carmaker Dacia SA, food processor Kraft Romania SA and steel manufacturer Arcelor Mittal Romania announced cutbacks or layoffs totaling 4,000 in October alone, meaning unemployment will keep rising from the current 4 percent.

To contact the reporter on this story: Adam Brown in Bucharest at abrown23@bloomberg.net; Irina Savu in Bucharest at isavu@bloomberg.net.

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