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Spain socialists win but short of overall majority

Spain’s governing Socialist Party won Sunday’s election but fell short of the absolute majority that might have helped them act more quickly to cushion an economic slowdown.

With 96% of votes counted, the Socialists were projected to win 169 seats in the 350-seat lower house, up five from the previous legislature. The conservative Popular Party (PP) won 153 seats, also up five from 2004, when voters turned against them after they rushed to blame the Basque separatists of ETA for election-eve train bombings that turned out to be the work of Islamists. The night’s big losers were small left-wing parties.

The economic slowdown and a sharp rise in unemployment dominated the election campaign until Friday, when a former Socialist councilor was shot at point-blank range in the Basque Country. Both main parties blamed ETA. Zapatero, started his victory speech remembering the five deaths attributed to ETA since it ended a ceasefire in December 2006 after he had made peace overtures. Zapatero has won popularity with liberals around Europe over the last four years by pushing through social policies such as legalizing gay marriage. But his next term will pitted with more serious problems as Spain’s economic boom comes to a sudden end. In the last nine months, 300,000 people have joined the jobless queues, most of them from the construction sector. Several analysts have cut their 2008 growth forecasts to about 2% after 3.8% growth last year and some worry that things could get worse if property companies start defaulting on their huge piles of debt. (Reuters)