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Poll a mixed blessing for Spain PM

Voters in Spanish prime minister Mariano Rajoy's north western home region of Galicia have given their support to his handling of the economy, but those in the turbulent Basque region handed a major victory to nationalist and separatist parties.

Mr Rajoy's Popular Party increased its absolute majority in Galicia, where austerity measures were introduced even before he took power as prime minister last year, with 41 seats in a legislature of 75.

In the Basque region, the Basque Nationalist Party - or PNV by its Spanish initials - took 27 seats while the separatist Bildu party claimed 21, giving pro-independence candidates their second-largest majority in 34 years of democracy.

The likely president of the Basque region will be PNV leader Inigo Urkullu, who called for calm in his victory speech and highlighted the need to restore his industrious and well-off region's economy.

"Resolving the financial crisis is a priority and the situation demands that we keep our feet firmly on the ground," Mr Urkullu said.

A deepening financial crisis and how best to address the nation's separatist tensions were the main issues in the elections. Spain is in its second recession in three years and has near 25% unemployment.

Since being voted to office in general elections in November, Mr Rajoy has been forced to hike taxes, cut spending and introduce stinging labour reforms in a bid to persuade investors and international authorities that Spain can manage its finances without the need for a full-blown bailout.

However, Spain's public finances have been overwhelmed by the cost of rescuing some of its banks and regional governments, many of which have suffered heavy losses in the property sector crash of 2008.

Some observers believe Mr Rajoy will seek a bailout soon, now that the elections are over.

The government's austerity measures have led to protests across the country, some of which have ended in clashes between demonstrators and police. The financial crisis has also brought to the fore calls from some of Spain's 17 semi-autonomous regions for greater independence.

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