Victory and Defeat for Portugal’s Pro-Austerity Right

Portuguese voters re-elected Pedro Passos Coelho as Prime Minister in a close election on Sunday. Despite Coelho’s personal victory, his Portugal Ahead coalition, made up of the pro-austerity Social Democratic Party and the People’s Party, failed to recapture its parliamentary majority. Portugal Ahead won just 38 percent of the parliamentary seats, while the anti-austerity Socialist Party, led by Antonio Costa, captured another 32 percent of seats. Without a majority, Portugal Ahead may face significant hurdles in passing budget measures within a Parliament that will be comprised, to a large extent, of left-leaning anti-austerity parties. Costa’s Socialists have given no sign of backing down from right-wing pressures either. After election results made his defeat clear, Costa announced, “Don’t count on us to approve policies that are against what we defend.”

The Socialists have long resisted austerity measures in Portugal, as demonstrated by Costa’s opposition to the austerity measures implemented by the pro-austerity coalition in 2011. Following the rollout of an unpopular bailout plan, which included reduced spending in education and health, Portugal fell into a three-year recession marked by high levels of unemployment and emigration.

However, this past year, an economic rebound has set Portugal’s economy on a more encouraging path, with a projected 1.6 percent growth rate.  While this resurgence likely contributed to Coelho’s re-election, it was not enough for the Social Democratic Party to maintain its majority. Now, Portugal Ahead’s agenda will focus on maintaining economic growth in the long run. Still, Coelho was confident after election results were released, declaring “It’s a day of hope because the next four years will be different from the past four.”