Rajoy has to keep the dialogue door open

After winning the parliamentary confidence vote on Saturday, Spain’s Prime Minister Mariano Rajoy tweeted, “We have a lot of work to do.” The premier realizes that the road ahead for him is fraught with formidable challenges.
Rajoy was sworn in on Monday. He will name a new Cabinet on Thursday. The first thing that Rajoy has to do is get parliament nod for a 2017 budget. Being under EU scanner, the country has to slash its deficit to 4.6 percent of its GDP this year and 3.1 percent in 2017. This will only be possible when enough parliamentarians support Rajoy’s economic plans. The deficit can be reduced either by cutting spending by €5.5 billion — while inviting the Left’s ire — or by hiking taxes, that might upset the business community and investors.
In the past, Rajoy has faced opposition for his austerity measures which apparently caused inequalities. The spending cuts or tax hike will give reason to his
detractors to up their criticism. Apart from this, Spaniards are angry about the rampant corruption and unemployment they are reeling under. Spain has the second highest unemployment rate in the EU that stands currently at 18.9 percent —blamed by conservatives on labour reforms made by Rajoy in 2012.
A pensions crisis has also taken roots as the population of the elderly grows in the country. Even if the retirement age is pushed back from 65 to 67 by 2027, the situation won’t improve much. The government will run out of social security
reserve funds in the next two years.
The Saturday vote may have ended the 10-month political impasse, but the
uncertainty is far from over. Rajoy won the confidence vote because 68 Socialists (PSOE) abstained as they didn’t want a reelection. Now, the big task for Rajoy would be to strike a strong rapport with PSOE. His Popular Party (PP) and PSOE have to find a common ground in economic reforms.
Alongside the economic challenges, Spain is witnessing a growing independence movement in its wealthy northeastern region. Rajoy can weather the Catalonia storm only when PSOE joins hands with PP. The issue can be solved by tweaking the country’s constitution. But to make such alterations, the PM would require support of two-thirds of lawmakers. Rajoy will have to find solid backing from PSOE — which itself is going through inner turbulence — as well as those who have trust in the government’s decisions.
By scrapping through the confidence vote, Rajoy has proved that he is a fighter and survivor. He has to deploy his political acumen to implement his economic policies. While doing so, he has to bring his opponents to the negotiating table and listen to their grouses. Rajoy is seeking a pact on changes to the way Spanish regions are financed. He must persuade the Catalan separatists to hold dialogues with the government and bridge the gap.
“I will focus on the issues that unite us, setting aside those which divide us,” Rajoy said on October 25 after receiving the King’s invitation to submit to confidence vote. It is only through talks and negotiations that Rajoy can protect the country from plunging into instability once again. He has to resist unjustified pressure, but be open to the right suggestion that comes his way!