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Spain's Rajoy faces high-stakes regional election


Spain

Spain's Rajoy faces high-stakes regional election

The Spanish government is facing a crucial test over its handling of the country’s financial crisis.

Voters have been casting their ballots in a regional election in Galicia – the home region of Prime Minister Mariano Rajoy and a traditional stronghold for his centre-right People’s Party.

The poll is being seen as a referendum on Spain’s bank bailout, spending cuts and tax hikes. The austerity measures have sparked massive demonstrations and pounded Rajoy’s popularity.

As well as Galicia, a regional vote is being also been held in the Basque Country – the first of its kind since the separatist group ETA announced an end to its armed struggle.

Polls suggest the nationalist PNV party is set to win the Basque vote, knocking aside a Socialist government.

The PNV – which would likely call for further fiscal autonomy from Madrid – may well need to form a coalition to govern with the left-leaning Bildu party.

Spain has entered its second recession since 2009 and its economic outlook is bleak. Unemployment stands at more than 25 per cent nationally and the country’s regional governments are drowning in debt.

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