BUCHAREST (Reuters) – Romanian lawmakers toppled the three-month-old centrist minority government of Prime Minister Ludovic Orban on Wednesday, raising the prospect of an early parliamentary election which Orban’s party says it is confident of winning.
Ousting the cabinet will likely usher in weeks of political wrangling and stalled policymaking at a time when widening budget and current account deficits are pressuring assets and rating outlooks.
“This government is now dismissed by parliament by a large margin,” said Marcel Ciolacu, the leader of the opposition Social Democrat Party (PSD), which spearheaded the no-confidence vote. “We did not create this crisis,” he said.
Striving to regain power after being ousted themselves in a censure motion in October, the Social Democrats have criticized Orban for trying to alter electoral laws without public debate ahead of a mayoral ballot in June.
Official data showed 261 lawmakers voted to topple Orban. The motion needed 233 votes to pass.
Commentators said the vote could open the way for an early election which Orban’s Liberal Party (PNL) and its key ally, President Klaus Iohannis are seeking in order to take advantage of the Liberal’s rising approval ratings.
Orban’s PNL has doubled its popularity ratings to about 47% since a 2016 parliamentary election, while PSD’s have halved to about 20% over the same period.
A snap election can be triggered only if parliament rejects two successive prime minister proposals within sixty days. Analysts have said the likely outcome is extremely unclear given fragmented and polarized parliamentary groupings.
“Knowing the chronic lack of consistency among Romanian politicians, as well as interpretation variations from the Constitutional Court, it is impossible to anticipate what will happen,” said Sergiu Miscoiu, a political science professor at Babes-Bolyai University.
“From now on, policymaking is done, we’re left with policy crushing. It’s possible that the precariousness of the (government) will weaken already low trust in state institutions.”
Romania, a European Union member, is due to hold local and general elections in June and December respectively.
“The road toward early elections is difficult, but they would remove fiscal uncertainties, being positive for local financial assets,” BCR Bank said in a note.
The Romanian leu traded 0.3% firmer against the euro after the vote.
“This government has landed on its feet,” Orban, who will now serve as an interim prime minister, said when asked about the possibility of an early poll.
On Tuesday, his cabinet approved dozens of emergency decrees across sectors including healthcare, energy and public administration. An interim cabinet cannot pass decrees.
Iohannis is expected to call political parties for consultations on designating a prime minister. He has made it clear his choice would only be Orban.
Editing by Toby Chopra