Leftists win power in austerity-weary Lithuania

by Marielle VITUREAU

VILNIUS, Oct 28, 2012 (AFP) - Lithuania's leftwing and populist opposition parties moved Monday to create a new government for the Baltic state following their victory in run-off elections, two weeks after austerity-weary voters erejected the centre-right in a first round of polling.

"We have agreed to form a three-party coalition, with the post of prime minister going to the Social Democrats, and to begin drawing up our government programme," Algirdas Butkevicius, leader of the centre-left Social Democrats, said as Sunday's parliamentary results rolled in.

"We don't have any points of disagreement," he added, following a closed-door meeting with the leaders of the leftwing populist Labour party and rightwing populist Order and Justice movement.

The trio had begun informal coalition talks after the left came top in the first round vote on October 14.

"We plan to sign our coalition deal once the Central Election Commission has certified the results," Butkevicius said Sunday.

Labour counterpart Viktor Uspaskich said Butkevicius was "certain" to become the European Union nation's next prime minister.

The trio's combined clout in Lithuania's 141-member parliament is now 79 seats. Half of the small republic's lawmakers are elected from party lists in the first round, while run-offs are held in single-member constituencies.

The final tallies were 38 for the Social Democrats, 30 for Labour and 11 for Order and Justice.

Uspaskich, who said Labour was eyeing the culture, transport, agriculture and economy portfolios, is a controversial figure.

The Russian-born ex-minister, member of the European Parliament and businessman -- who made his fortune importing gas and producing gherkins -- is locked in a long-running party funding probe by Lithuanian prosecutors and tax authorities.

Labour is also facing a vote-buying inquiry that voided one constituency's results, forcing a re-run in coming months.

Order and Justice, meanwhile, is run by impeached ex-president Rolandas Paksas.

The defeated Conservatives, who had been pushed into third place in the first round, made up some ground Sunday, garnering a total of 32 seats.

"The results are not bad," said outgoing Prime Minister Andrius Kubilius. "We are among the leading parties in parliament."

Kubilius, in power since 2008, paid the price for draconian spending cuts imposed as the nation of three million was battered by one of the world's deepest recessions.

The remaining seats were shared between the Conservatives' governing ally the Liberal Movement, with 10 parliamentarians, an ethnic-Polish party with eight, and the newborn anti-corruption Way of Courage movement with seven.

In a sign of frustration with Lithuania's fractious politics -- Kubilius is the only premier to survive a full term since the country seceded from the Soviet Union in 1990 -- Sunday's turnout was around 35 percent, well below the first-round's 53 percent.

The Social Democrats and Labour pledge to mend ties with Soviet-era master Moscow and raise the minimum wage, while the Social Democrats aim to introduce a progressive income tax.

Butkevicius, a former finance minister, cultivates the image of a prudent economic steward, and analysts say sweeping change are unlikely.

"Taking into account financial markets, EU membership and the EU's excessive deficit procedures, the room for manoeuvre would be limited," Ramunas Vilpisauskas, director of the Institute of International Relations and Political Science in Vilnius, told AFP.

"A few symbolically-important pledges may be implemented. But I guess that a major part will stay on paper," he added.

In the 2008 general election, voters heeded the Conservative message that a Social Democrat-led coalition had left the country ill-prepared as growth -- which spiraled upward after EU entry in 2004 -- ground to a halt amid the global economic crisis.

Kubilius was also premier in 1999-2000 when Lithuania was lashed by the economic meltdown in neighbouring Russia. But the 2009 crisis was far deeper, as Lithuania's economy shrank by 14.8 percent.

His government brought in austerity measures much wider in scope than those adopted in western members of the 27-nation EU, avoiding a currency devaluation or international bailout.

Growth returned in 2010, at 1.4 percent, before hitting 6.0 percent in 2011, but too few voters felt the benefits, analysts said. The pace slowed to a forecast 2.5 percent this year.

"I'm hoping that the next four years will bring a better life," highway worker Kazimieras Namenkevicius told AFP.

But retiree Aleksandras Bylatis was far from upbeat: "I'm not expecting anything from the new government."