The Swedish Prime Minister Mr Goran Persson's Social Democrats led in yesterday's general election with 95 per cent of votes counted, and appeared set to form a minority government relying on the support of the Left party.
But the election was a catastrophe for Mr Persson and the Social Democrats, who registered only 36.5 per cent of votes, their poorest election result for the party that has been in power for 57 of 66 years and is the founder of the Swedish welfare state.
The former Communist Left is the biggest surprise of the election, with its strongest score since the Russian revolution at 12 per cent. The Social Democrats and Left Party together hold 48.5 per cent of votes, or 174 of 349 seats in the Riksdag, one short of a majority and likely to create a thorny situation in parliament.
Mr Persson (49) has repeatedly said he would not ask the Left Party to form a coalition government, but indicated he could seek out an informal alliance.
"We are going to take the opportunity to pursue a Social Democratic policy. We are going to fight for a fairer and more just Sweden," Mr Persson said, expressing disappointment that voter turnout was under 80 per cent in a country where it is generally above 85 per cent.
Ms Gudrun Schyman (50) said her Left Party, which more than doubled its score from the 1994 election and is now the third-largest party, is looking for a "long-term co-operation" agreement with the Social Democrats.
"We will have to sit down to discuss with the Social Democrats what to do together," she said, adding: "What is important is to work out a long stable policy for the whole mandate period."
The Left Party is expected to call for a referendum next year on the euro, the dismantling of Sweden's 12 nuclear power stations, a shorter working week and increased social benefits.
Ms Schyman said she was overjoyed by her party's result.
"Our score is fantastic, I worked hard for this result," she said.
The rise of the Left is largely attributed to Ms Schyman, who has enticed many traditional Social Democrats who feel betrayed by their party's move toward the centre.
Several years of tight Social Democratic budget policy have put the Swedish economy on the right track, but sharp cuts have left Swedes crying out for a return to the cradle-to-grave welfare state - even if it means paying higher taxes in a country that is already one of the most taxed in the world.
Mr Persson has vowed to continue his austere economic measures mixed with generous social benefits, as this year's election campaign focused on health care, education, social benefits and unemployment.
The opposition non-socialist bloc, consisting of the conservative Moderates, the Christian Democrats, the Liberals and the Center Party, won a combined 44.2 per cent. Respectively, the parties won 22.6, 11.8, 4.7 and 5.3 per cent. The Greens won 4.4 per cent, and other parties took 2.7 per cent of votes.
Another big surprise in the election result is the rise of the Christian Democrats, who almost tripled their score from 4.1 to 11.7 per cent, after promoting family values, child allowances and better conditions for pensioners.
The leader of Sweden's far-right Nya Partiet (New Party) yesterday said he was quitting politics.
Mr Ian Wachtmeister, (65), is a former leader of the Nya Demokratiet (New Democracy) party, which won 6.7 per cent of the vote in the 1991 election, giving it 25 seats. It was wound-up after the 1994 poll, after it won just 1.2 per cent of the vote.