(Bloomberg) -- Romanian Prime Minister Marcel Ciolacu won the vote to stay in power with the backing of a newly-formed coalition that aims to end the country’s biggest political crisis in decades.
Lawmakers in Bucharest voted 240-143 on Monday to confirm the new government, lawmaker Daniel Suciu said in an address in parliament. The decision caps a period of post-election chaos that saw a rise in support for the far right in a NATO member and the Europe Union country with the longest border with Ukraine.
It also marks a stunning comeback for Ciolacu, 57, who only weeks ago appeared on the way out after losing a now voided presidential election and stepping down as the leader of his Social Democratic party. He is now leading an alliance with a slim parliamentary majority and a series of urgent tasks on its to-do list.
The priority for the new government will be to agree on how to rein in the European Union’s widest budget deficit as it tries to avert a potential rating downgrade. It’s also under pressure to fend off the far right during a contested re-run of a presidential election, expected in March or April.
“These are very complicated times and I think we all learned from the mistakes of the past,” Ciolacu said on Monday after he was tapped to lead the next cabinet. “It’s crucial to restore the investors’ trust and to ensure a stable environment for businesses.”
The pro-EU coalition is comprised of the Social Democrats, the Liberals, a party of ethnic Hungarians and a group representing other minorities. The parties have agreed to back a joint candidate for the presidential elections next year, veteran former Liberal Party leader Crin Antonescu.
Very Narrow
Ciolacu’s government will have to tackle a budget deficit that’s poised to surge to over 8.5% of economic output this year, in large part due to pre-election spending spree under his previous administration. Fitch Ratings signaled earlier this month it may cut Romania’s credit grade to a junk status, citing high political uncertainty.
The new administration will also need to organize a re-run of a presidential ballot after the top court annulled last month’s election following accusations that Russian meddling had catapulted a little-known far-right candidate Calin Georgescu to first place.
The vote and its subsequent cancelation triggered the deepest political crisis in Romania in decades.
The coalition talks have been fraught by infighting as parties brace for the prospect of budget cuts ahead of the presidential vote, which risk fueling support for extremists. The Social Democrats briefly walked away from the talks last week in a move that almost torpedoed the nascent government.
The new cabinet includes 16 ministries, two fewer than in Ciolacu’s previous government. The Social Democrats are running eight ministries, the Liberals have six ministries, while the party of ethnic Hungarians appointed the finance minister, Barna Tanczos, as well as the development minister.
“The room for maneuver of the new government is very narrow,” Liberal Party leader Ilie Bolojan told reporters in Bucharest late Sunday. “It has to take measures to avoid worsening the budget.”
(Updates with vote count in second paragraph, Prime Minister’s comment in fifth.)
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