Belfast Telegraph

Tuesday 30 September 2014

Finnish vote may hit EU bailouts

Timo Soini, leader of the opposition True Finns party, casts his vote in Finland's parliamentary elections (AP)

Huge gains for a nationalist eurosceptic party in Finland's general election have posed a challenge to EU plans to rescue Portugal and other debt-ridden economies.

The pro-EU conservative National Coalition Party topped Sunday's vote but the coalition it previously belonged to no longer has a parliamentary majority.

The party is expected to begin difficult negotiations on the formation of a new government with at least one eurosceptic party.

Prime Minister Mari Kiviniemi's Centre Party has said it will drop out of the government after falling behind the two opposition parties that have challenged eurozone bailouts.

The anti-immigration and staunchly eurosceptic True Finns do not see why Finland should rescue Europe's "squanderers", while the Social Democrats have called for changes to how they are funded.

Conservative leader Jyrki Katainen will have to invite at least one of them to coalition talks, raising questions about Finland's support for rescue packages that need unanimous approval in the 17-member eurozone.

"This result will give Europe grey hairs," political analyst Olavi Borg said. "It will cause them problems over the bailout funds."

Timo Soini, True Finns leader and member of the European Parliament, said that his party's success gives them a right to be in the next coalition, although he expected talks on policy to be "difficult". He declined to say whether his party will vote against Portugal's rescue package.

"The current government lost the election and that must be reflected in the next coalition's policies," he said. "We're won't be leaving (the EU or eurozone) ... but it's clear that we can't increase the controlling power of Brussels."

If any single country pulls out, the funding system will crash, leading to a worsening of the debt crisis at a time when the group is deciding whether bailouts will end with Portugal or will also be needed for larger economies like Spain or Italy.

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