Portugal’s new government collapsed this week after just 11 days in office. A centre-right coalition emerged as the largest bloc after the 4 October election, but without a parliamentary majority. Since then, the Socialists, Communists and far-left Left Bloc have buried historical differences and last Tuesday managed to oust the government in a no-confidence vote. They now look set to form a government……..
….This Portuguese drama is “part of a larger process of political fragmentation” in Europe, noted Lachman. Catalonia is making noises about declaring independence from Spain, while the migrant crisis is undermining Angela Merkel’s authority.
If Spanish socialists combine with new insurgent parties to boot out the right in Spain next month, added Evans-Pritchard, the whole of southern Europe would be left-leaning. It would then have the “heft to confront Germany and push for a fundamental overhaul” of the euro bloc’s economic policy. Political risk in Europe is making a comeback.