Ireland braces for first-ever coalition

Ballot papers are piled up as counting begins in the home town of Fine Gael party leader Enda Kenny, Castlebar in western Ireland on February 27, 2016, a day after the polls closed in the Irish General Election. Ireland faced political uncertainty on Saturday after two exit polls indicated voters had punished the outgoing governing coalition in Europe's fastest-growing economy, which is feeling the pain of years of austerity. Both Prime Minister Enda Kenny's centre-right Fine Gael and its Labour junior partner lost support as voters angry at continuing hardship in the eurozone country shifted to independent politicians and leftwing parties. / AFP / PAUL FAITH

Ireland / Bloomberg

Ireland’s two biggest parties may be forced to bury generations of conflict borne out of the nation’s civil war to form a grand coalition after Prime Minister Enda Kenny’s government suffered massive losses in election.
Kenny’s Fine Gael secured 25 percent in Friday’s election, according to a poll for broadcaster RTE, released on Saturday. Traditional rivals Fianna Fail secured 21 percent. Under Ireland’s electoral system, about 44 percent is needed for an overall majority.
Like governments in Greece, Portugal and Spain, Kenny’s alliance with the Labour Party emerged from Europe’s debt crisis to feel the force of popular wrath over spending cuts and tax increases. Kenny’s only option to provide political stability in the fastest-growing economy in the euro region is a pact with Fianna Fail, with bookmaker Paddy Power Betfair Plc placing an 80 percent probability on such a government coming together.
“At this stage, it has to Fine Gael and Fianna Fail or else a second election,” Eoin Fahy, chief economist at Kleinwort Benson Investors in Dublin.

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