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BUCHAREST (Reuters) - Romania's President Traian Basescu was left little choice on Monday but to re-appoint rival Victor Ponta as prime minister after the leftist's party won a clear election victory.
Ponta's Social Liberal Union (USL) won up to 60 percent of votes in Sunday's parliamentary election, preliminary results showed. The electoral system could give it an even bigger share of seats in the Balkan country's parliament, putting Ponta in a strong position in a power struggle with the right wing Basescu.
Although Basescu had said he would not ask Ponta to be prime minister again after the USL failed to impeach him in July, he has recently softened his language. The president could still name someone else from the USL, seeking to split the broad alliance of leftists and liberals, analysts and local media have said.
Any uncertainty over a new government would delay talks over a new deal with the International Monetary Fund to replace a 5 billion euro ($6.5 billion) agreement expiring in early 2013. The leu currency and Bucharest stocks were a touch higher after the results.
"Perhaps he will delay things a little, but ultimately I believe the president will nominate Ponta," said Sergiu Miscoiu, an analyst with the CESPRI political think tank.
Basescu has not yet commented on the election result. Ponta has said he hopes the vote will end the political "civil war".
Ponta's party has promised to roll back the previous centre-right administration's austerity policies by cutting taxes and raising salaries, though it has limited room to do so given expectations of growth this year of just 0.4 percent.
For its attempt to impeach the president, the USL came in for harsh criticism from the European Union and United States, which accused it of undermining the rule of law. Political analysts say that could discourage it from more radical steps.
On many indicators, Romania trails other ex-communist neighbours like Hungary, Poland and the Czech Republic.
Corruption is rife, its roads and rail are outdated and it cannot provide reliable basic services such as running water and electricity to all its 19 million people nearly a quarter of a century after the fall of dictator Nicolae Ceausescu in 1989.
Results from four-fifths of polling stations showed Basescu's Right Romania Alliance (ARD) allies in second place on 17 percent and populist Dan Diaconescu on 14 percent, the election bureau said. The ethnic Hungarian UDMR, which Ponta said he would seek to work with, had just over 5 percent.
An electoral system which tends to favour larger parties could give the USL an even bigger proportion of seats in parliament.
With two-thirds of seats it could change the constitution, as Viktor Orban has done in neighbouring Hungary.
But political analysts said it may prefer not to be too confrontational given the harsh criticism it faced from the EU over the attempt to impeach Basescu, when it was forced to back down on some proposed changes to laws.
"I think they got really beaten up by the EU and they're a little scared," said Barclays Capital analyst Daniel Hewitt. "There's a lot of people watching and this would be a bad move."
Though the outspoken former sea captain Basescu has softened his language on Ponta in the last two weeks, he has stopped short of saying he would reappoint the premier - saying only that he would seek someone to act in the best interest of the country.
Given Sunday's emphatic USL win, it would be difficult for the president to nominate anyone other than Ponta without appearing to undermine the constitution and rule of law himself.
It could also prompt the USL to try and impeach the president again, which would mean another bout of uncertainty.
"Our wish is to consider that this day puts an end to a civil war...which has destroyed a large part of Romania, destinies, lives and hopes," Ponta said late on Sunday.
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Writing by Sam Cage; Editing by Matthew Tostevin