Portugal’s Socialist Party leader Antonio Costa said Tuesday the country’s left-wing parties are ready to form a coalition government with a stable majority in Parliament.
"We have informed (the president) that following contacts that we have had with the Communist Party and the Left Bloc ... there are conditions to form a government with majority support in parliament," Costa said, according to Reuters.
The announcement caused a political stir among the coalition of Prime Minister Pedro Passos Coelho’s centre-right bloc, which won most of the votes in the Oct. 4 election but fell short of a majority.
"It is extraordinary to see a political leader (Costa), seeking his survival, to consider the vote of the people a detail and parliament a mere formality," Portugal’s caretaker Deputy Prime Minister Paulo Portas said in response.
While it is still expected that Passos Coelho will be named prime minister, it is up to President Anibal Cavaco Silva to decide how to proceed.
Analysts claim a left-wing coalition led by moderate socialists is unlikely since the Left Bloc and the Communist Party have largely opposed harsh austerity measures while Costa has been much more lenient to implement EU-imposed budget cuts.
After ascending to power in the wake of an economic crisis, Prime Minister Coelho and his coalition slashed public spending based on recommendations made by the European Commission, the European Central Bank and the International Monetary Fund. That was followed by a significant drop in unemployment, from 17.5 percent in 2013 to 12 percent today.
Portugal nonetheless continues to suffer from extremely high rates of economic deprivation. One in five Portuguese citizens live under the official poverty line, earning less than US$5,600. Another 3 million people are in danger of falling into poverty, according to independent analyses.