10 February 2004

EZA 580 : Spain-Politics

Spain; Rajoy set to win third term for PP, policy to continue in Aznar's footsteps
Spain’s Partido Popular (PP) looks set to win a convincing win in the general election on Mar. 14. This will be the third consecutive win for the party since coming to power in 1996 and the first for the PP’s new leader Mariano Rajoy. Last August José María Aznar the Spanish Prime Minister stepped down as head of the PP leaving the way for Rajoy to form the next government in the event of a PP win. The seemless inevitability of a PP win — it is 10 points ahead of the rival socialist PSOE with just four weeks to go — is mostly an endorsement by the electorate of the party’s strong record of economic success and lower taxes. At this late stage there seems little chance that the opposition PSOE can engineer the major come-back needed to put the election in the balance. Rajoy, who has been in Aznar’s shadow since the early 1990s, looks set to continue Aznar’s policies: a balanced budget, yet further liberalizations of business, lower taxes and lower government spending and a foreign policy that looks to the US as well as to Europe. Within the EU, expect the hard line from Aznar to continue through Rajoy over any issue that diminishes Spain’s voting rights or entitlements.

SummaryAsset conclusions: P P win an endorsement for status quo — business friendly government, low taxes, balanced budget — positive for Spanish assets

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© Graham Bishop