The Portuguese cast their votes Sunday in an election that could bring greater political uncertainty as the ruling Socialists are expected to win but fall short of an absolute majority, Reuters reported.
Prime Minister Jose Socrates, an energetic 52-year-old, is expected to win around 38 percent of the vote, according to the last polls. That result will leave him short of his current majority and he is likely to have to rule with a minority.
The highest unemployment rate since the 1980s and the worst economic downturn in decades has not been enough to push the Portuguese away from the center-left Socialists, who launched market reforms and cleaned up public finances in their first term.
Manuela Ferreira Leite, 68, the candidate for the center-right Social Democrats, has fared poorly against Socrates, analysts said.
She is known as a tough cost cutter from a stint as finance minister when current European Commission President Jose Manuel Barroso was prime minister of Portugal.
Analysts said that a minority government would not be a disaster, but could reduce Socrates' ability to make ambitious reforms. He won 45 percent of the vote in 2005, giving him a strong absolute majority in parliament, allowing him to clean up public finances and to reform pensions and the civil service.
"If the Socialists get 38 percent of the vote as the polls indicate, it is not the worst of situations for their survival, it has been done in the past," analyst Antonio Costa Pinto said.
The two parties may have to cooperate, particularly on public finance and the 2010 budget. Spending cuts or tax hikes are needed to start bailing out from this year's budget deficit of 5.9 percent of GDP, substantially above European guidelines.
On other matters, like social reform, the Socialists may turn to leftist parties. Socrates, like the left, sees a bigger government role in the economy, with projects to create jobs.
But the left staunchly opposes Socrates's market-friendly economic policies, including privatisation.
With the global economic crisis causing debt levels to soar once again, Ferreira Leite warned that government spending should be sharply reduced.
But Socrates has advocated a series of big, vote-winning infrastructure projects, such as a high-speed TGV train link to Spain and a new airport for Lisbon to boost jobs and generate robust economic growth.
This year the economy is expected to contract up to 4 percent in what is western Europe's poorest country, which has GDP per capita of 15,600 euros ($22,910), almost half the euro zone average of 28,300 euros.
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