On July 23, Spain will be holding its next general election, and the outcome could potentially result in the far right party, Vox, coming to power for the first time since Francisco Franco’s dictatorship. The latest polls indicate that the conservative People’s Party (PP) is expected to secure around 34% of voter support. However, this alone would not be enough for the PP to form a majority government.
In light of this, analysts predict that the most likely scenario would be a coalition government with the PP taking the lead and Vox serving as the junior partner. Vox is projected to obtain more than 10% of the votes, indicating a significant rise in popularity compared to previous elections. This potential coalition has raised concerns among many Spaniards, as it could signify a shift towards more right-wing policies and ideologies.
Despite these apprehensions, the possible alliance between the PP and Vox is seen as moderately positive for the Spanish market. Spanish asset prices have performed well leading up to the election, and analysts expect them to remain stable even if the coalition comes to fruition. Additionally, Spain’s sovereign credit spread is projected to remain steady compared to Germany.
The reasons behind the market’s optimism lie in the potential economic policies that would likely be implemented by a PP-Vox coalition. Both parties prioritize business-friendly measures such as tax cuts and deregulation, which could attract investment and stimulate economic growth. However, concerns about social issues and the potential erosion of civil liberties persist among critics of the far right.
As the election day approaches, Spain finds itself at a crossroads. Voters will ultimately decide the direction the country takes, with the possibility of a new era marked by right-wing politics. The outcome will undoubtedly have significant implications, not only for Spain but also for the European continent as a whole.
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