Finns to vote, populist party threatens EU bailout

Sat Apr 16, 2011 8:27pm EDT

Related Topics

* Anti-euro True Finns to show strong gains, may join gov't

* National Coalition party leading polls at 21 percent

* Balloting stations close at 1700 GMT Sunday

By Ritsuko Ando and Jussi Rosendahl

HELSINKI, April 17 (Reuters) - The anti-euro True Finns party is expected to reel off big gains in Finland's general election on Sunday, threatening pro-European government and raising the risk of disruptions to an EU bailout of Portugal.

Finland, unlike others in the euro zone, can put requests for bailout funds to a majority vote in parliament, meaning that the election outcome is likely to affect European Union plans to shore up Portugal and stability in debt markets.

The National Coalition, No. 2 party in Finland's current governing coalition, staked out a narrow pre-election lead with around 21 percent of votes, according to a poll by public broadcaster YLE published on Thursday.

That was not enough to secure a majority in parliament, however, and analysts expect it to seek a multi-party coalition.

Some say it could even work with the True Finns if the populist party won enough votes and backed down from their opposition to EU bailout plans.

While most saw an outside chance of the next government balking at the Portugal bailout plan, analysts said Finland could begin taking a harder line on EU affairs as domestic leaders pay heed to voter discontent.

"Whether the True Finns will really (emerge) as champions of the elections is still uncertain, but I think we will clearly get a more nationalistic, more conservative, less European-oriented government in Finland," said ING senior economist Carsten Brzeski.

BROAD COALITION?

If the National Coalition finishes first in Sunday's election, in which the polls will close at 1700 GMT, its leader and current Finance Minister Jyrki Katainen is likely to seek out multiple alliances.

The three other main parties -- Prime Minister Mari Kiviniemi's Centre party, the True Finns and the opposition Social Democrats -- command 15-19 percent support each.

National Coalition minister Jan Vapaavuori on Friday played down fears of a new anti-euro government, saying any coalition that is formed would support the EU.

The True Finns, he said, would probably tone down its rhetoric as a condition of joining government. The Social Democrats, who are critical of the bailout plan but supportive of the EU, would be even easier to get on board, he said.

"Either it's a pre-condition for them to support Portugal in the next government, or at least not to vote against it... I'm sure that Finland will be in line with other European countries in the next government," he told Reuters.

The True Finns have said they have no intention of backing down from their opposition to the bailout plan, but political analysts said the party and its charismatic leader, Timo Soini, would probably compromise if needed.

"It would be strange for a party to grow so much but not want to use that power and enter government," said Kimmo Gronlund, research director at Abo University.

Support for the True Finns has nearly quadrupled since the 2007 election. Analysts say many Finns have become disenchanted with the other main parties, as combinations of those three have run the country for decades and voters feel they have lost touch with the people.

A scandal over political funding has hurt the Centre party, and unemployment is also driving voter angst. The economy's recent rebound from the global financial crisis has done little to increase the number of jobs.

The country's flagship company, Nokia (NOK1V.HE), is struggling to compete with Apple Inc (AAPL.O) as well as Asian handset makers, and is expected to cut jobs soon.

Finland's other main industry is timber, but many large mills have been closing.

(Editing by Mark Heinrich)

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