Socialist chief Pedro Sanchez set to become Spain’s Prime Minister

MADRID (Reuters): Pedro Sanchez was almost certain to become Spain’s new Prime Minister after his socialist party on Thursday secured enough votes to topple Mariano Rajoy in a confidence vote over a corruption case.

Sanchez has received the backing of six parties totalling 180 votes in parliament to become prime minister, more than the absolute majority of 176 votes needed to take power immediately if the no-confidence vote is held on Friday as scheduled.

Rajoy’s departure would trigger a second political crisis in southern Europe, further unnerving financial markets already wrongfooted by failed attempts to form a government in Italy three months after a national election.

With most Spanish parties in favour of respecting EU fiscal rules, however, investors appeared to see less risk of an abrupt policy shift than in Italy, where parties have thrown doubt on the commitment to the euro single currency.

Spain’s blue-chip index Ibex closed down 1 percent on Thursday but the news of Rajoy’s likely downfall did not trigger a major sell-off and Spanish stocks were also hit by the trade war the US started with Europe and other allies.

Rajoy, who did not attend the afternoon session of the debate on Thursday, ruled out resigning before the vote in a move that would have slowed down the transition.

Shortly before he secured the key support of the Basque Nationalist Party (PNV), Sanchez had told Rajoy it was still time to leave and avoid the humiliation of becoming the first Spanish prime minister to lose a no-confidence vote.

“Are you ready to resign? Resign today and leave by your own will,” Sanchez told Rajoy. “You are part of the past, of a chapter the country is about to close.”