Belgium enters crunch talks after poll shock

14th June 2010, Comments 0 comments

Right-wing Flemish separatist and left-wing francophone unionists began tortuous negotiations on Monday to resolve federal Belgium's future and its finances.

As markets sensed weakness at the very heart of debt-laden Europe following Sunday's sea-change elections, observers doubted whether deep ideological chasms -- linguistic, political and economic -- could be bridged over coming months.

King Albert II took the first steps by meeting outgoing caretaker prime minister Yves Leterme and subsequently the vote's shock victor, 39-year-old republican New Flemish Alliance chief Bart De Wever.

The latter -- who turned up at the palace without wearing a tie -- ultimately wants independence for Belgium's Dutch-speaking majority in affluent Flanders, and in the first instance, full fiscal control.

As voters digested Flemish demands to re-draw state powers and media wondered whether any kind of compromise could be reached, the question is: what kind of place will Belgium become?

While the Flemish want only the loosest of ties to be retained at federal level, the subtext and much of the fighting will revolve around how state finances will be fixed.

In Overijse, an NVA stronghold near Brussels where municipal authorities did deals with property agents to keep francophones out, Flemish voters said people "no longer want a large part of their money to go to Wallonia," according to Dutch speaker Eliane Bergiers.

De Wever's party tapped successfully into these concerns, but leaders in the poorer, southern Wallonia are expected to fight long and hard for a shared welfare state to be retained.

"We are fewer because we have less money," explained retired French teacher Francine Beyens, who has detected "animosity going back years" in Overijse and wants better social protection.

Belgium has had four governments and three prime ministers since its last general election in 2007.

And the search for a coalition agreement, one that could avoid a definitive split that would be viewed with immense European interest from Scotland to Catalonia, is unlikely to be straightforward.

"If our country stays several months without a government, our credit rating will suffer," warned Paul Soete, head of Belgium's technology employers federation Agoria, fearing that bond yields could rise sharply as in Greece or Spain.

There was an increase on Monday, but Frankfurt-based Goldman Sachs economist Erik Nielsen suggested much would depend on how De Wever plays the hand he has been given.

The full effect of the NVA's win "needs to be watched carefully," he said, pointing out that the federal state's financing needs "are among the largest in Europe this year and next."

Official results confirmed that De Wever's party won the largest number of seats, 27 in the 150-member lower Belgian federal house, with the largest share of the vote in Flanders -- 28.2 percent.

The Socialists secured 26 seats, with 36.6 percent of the vote across Wallonia and the third federal region of Brussels, well ahead of Leterme's Christian Democrats, who picked up 17 seats on 17.6 percent.

Parallel polls combine to produce countrywide results in Belgium, with parliamentary arithmetic making cross-language deals inevitable.

De Wever has distanced himself as a candidate for premier, leaving openly homosexual Walloon Socialist leader Elio Di Rupo as favourite to become the first francophone post-holder since the 1970s.

Leterme retains control of day-to-day affairs -- and is firmly expected to take Belgium's lead when it assumes the European Union's six-month rotating presidency on July 1.

© 2010 AFP

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