* PM Orban's party to have big majority in parliament
* Far-right Jobbik backed by one in five Hungarian voters
* Investors concerned over PM's go-it-alone policies
* Not yet clear if Orban will secure constitutional majority
(Adds OSCE criticism of election, Orban's comments)
By Gergely Szakacs and Krisztina Than
BUDAPEST, April 7 Hungarian Prime Minister
Viktor Orban, who has clashed repeatedly with the European Union
and foreign investors over economic policy, said on Monday a
weekend poll victory gave him a clear mandate to "continue what
we have started".
A twenty percent vote for the far-right opposition Jobbik
party, accused of anti-Semitism, raised concern among ethnic
minorities. That outcome will be noted also in other European
Union countries expecting a rise in right-wing and
anti-immigration parties at May European Parliament elections.
Orban has raised concern among foreign investors and in the
EU with policies including a windfall tax on the banking sector,
and reductions in household energy prices.
But many Hungarians see Orban, a 50-year-old former
dissident under Communism, as a champion of national interests.
After 99 percent of ballots were counted from Sunday's vote,
an official projection gave Orban's Fidesz party 133 of 199
parliament seats, guaranteeing it will form the next government.
That tally also gave Orban's party the two-thirds majority
needed for it to change the constitution, but only by one seat.
Final results could still push Fidesz back below the threshold.
The same projection gave the Socialist-led leftist alliance
38 seats, while far-right Jobbik was on 23 seats.
International election observers said the election was,
overall, transparently administered; but some factors gave undue
advantage to the ruling party.
Orban's Fidesz had revamped the election system in a way
which its critics say favoured the ruling party.
"These (factors) included the manner in which a large number
of changes to the legal framework were passed, restrictive
campaign regulations, ...biased media coverage," the mission of
the Organisation for Security and Co-operation in Europe (OSCE)
said in a statement.
Speaking at a news conference, Orban rejected the criticism.
"We got a clear and unquestionable authorisation to continue
what we have started," Orban said.
Chancellor Angela Merkel's spokesman told a news conference
Orban had a special responsibility to use his majority "with a
sense of proportion, restraint and sensitivity".
Orban said he planned to retain a windfall tax on the bank
sector he has introduced over the past four years,
When asked about the forint's exchange rate, he declined to
comment, saying it was a matter for the central bank.
Some market players believe the bank, led by a close Orban
ally, could weaken the currency further, a risky strategy at a
time when investors are already jittery about emerging markets.
Hungary's forint weakened 0.4 percent by 1343 GMT.
Jobbik's performance is being watched closely for clues
about how other nationalist right-wing parties, such as France's
Front National and the Netherlands' Party for Freedom, will
perform in European Parliament elections next month.
In terms of its share of the national vote on party lists,
Jobbik won 20.54 percent, up from 15.86 percent of all votes
four years ago.
Its showing was the strongest of any far-right party in the
EU in the past few years, according to Cas Mudde, Assistant
Professor at the School for Public and International Affairs at
the University of Georgia in the United States.
He said the previous strongest result for a far-right group
was the 20.5 percent won by Austria's Freedom Party last year.
"There is no doubt that Jobbik will be among the strongest
far-right parties in Europe, which is particularly striking
because it is also one of the most extreme of Europe's far-right
parties," Mudde told Reuters.
Jobbik has pledged to create jobs, be tough on crime,
renegotiate state debt and hold a referendum on EU membership.
While it denies being racist, it provides a lightning rod for
suspicion among some Hungarians towards the Roma and Jews.
Hungarian Gypsy Party chairman Aladar Horvath ran with the
promise of representing Hungary's 700,000 Roma, but his party
got less than 9,000 votes. He said Jobbik's gains made it more
difficult to end tensions between Roma and majority Hungarians.
"As Jobbik gains, Fidesz is forced to defend its voter base
and act tougher, but that toughness closes doors on us," Horvath
told Reuters. "Stricter law enforcement and Spartan social
policy make it harder for the Roma to break out of the ghettos."
In the past four years, Orban's policies have included a
nationalisation of private pension funds, swingeing "crisis
taxes" on big business, and a relief scheme for mortgage holders
for which the banks, mostly foreign-owned, had to pay.
Orban has pledged more of the same if re-elected, and the
business community expects him in particular to press ahead with
a plan to transfer big chunks of the banking sector into
Hungarian hands, and impose more burdens on foreign power firms.
His policies helped Hungary emerge from recession, but some
economists say Orban may have scared off the kind of investment
Hungary needs for long-term growth.
"The government is yet to deliver on its promises to
stabilise policies and create a better environment for FDI,"
Unicredit analyst Dan Bucsa said in a note.
(Additional reporting by Marton Dunai; additional reporting by
Stephen Brown; Writing by Christian Lowe; Editing by Ralph