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Spain's acting PM loses confidence vote to form government

01 September 2016 02:53 (UTC +04:00)

Baku-APA. Spain's acting premier on Wednesday lost a parliamentary confidence vote for a second term after he failed to win enough support from the opposition, bringing the country closer to a potential third election in a year, APA reports quoting Reuters.

Mariano Rajoy, of the center-right People's Party (PP), received 170 votes of support, falling short - as expected - of the minimum 176 needed to form a government. He needed the support of the Socialists, who voted unanimously against him, to win the required absolute majority.

Spain's lack of a functioning government since inconclusive elections in June and December, and the resulting political deadlock, have stalled investment and there are signs it could be starting to limit a strong economic recovery.

Government bond yields rose sharply ahead of the vote, underperforming euro zone peers, as the possibility of more months of political impasse spooked investors.

Liberal newcomer Ciudadanos voted in favor of Rajoy, as did a small party from the Canary Islands region. The Socialists, anti-austerity alliance Unidos Podemos, and regional parties from the Basque Country and Catalonia voted against him.

Rajoy now faces a second vote on Friday in which delegates can abstain and a simple majority would suffice to allow him to form a PP-led minority government. He would need just 11 abstentions to win this second vote, but a loss is also likely if the Socialists do not cede.

If he loses Friday's vote, Rajoy has two months to try to form a government before triggering another election, which could then could fall on Christmas Day.

Socialist Party leader Pedro Sanchez says Rajoy is too tarnished by a long series of corruption scandals involving the PP and the austerity policies his PP government enacted during a deep recession.