Finland poll leader open to deal with eurosceptic populists

The poll favorite to be Finland's next premier says he is open to taking eurosceptic populists into any new governing coalition but expects they could cause difficulty with demands like an end to bailouts and kicking Greece out of the euro zone.

Opposition Centre Party leader Juha Sipila, a centrist with support from both the urban middle class and rural conservatives with eurosceptic tendencies, is commanding around 25 percent in polls ahead of the April 19 election.

To form a government, he may need the backing of The Finns party, formerly known as the True Finns, who spooked markets in the last election by opposing financial rescues for ailing members of the euro zone such as Greece.

"I can do business with them," the 53-year-old Sipila told Reuters in an interview. "They are a populist party but they are also realistic in economic issues."

However, he added, "there are a lot of differences between us and The Finns. I'm in favor of the EU and our place in the West. The Finns are against everything that happens in the EU.

"There could be some difficult issues but not any issues we can't overcome."

Finland has stumbled through three years of recession with some of the highest state spending and tax burden in the European Union. Its flagship company, Nokia, has shed thousands of jobs and the euro zone economy has lost competitiveness.

The current center-right National Coalition government angered other EU countries by demanding collateral before agreeing to aid Greece and Spain and maintained a tough line in negotiations on an extension to Greece's financial rescue. When in opposition, Sipila's party, along with The Finns, voted against the second Greek bailout.

"On the Portugal and Ireland (bailout) issue we voted with the government even from the opposition. Greece is different. The big issue is that they do what we have agreed," Sipila said, alluding to EU calls on Greece to live up to its bailout terms.

"I think we're tough enough. I don't speculate what happens if Greece exits (the euro zone). I can't see any room for (a) third bailout package at the moment."

Sipila said he was now more optimistic about the euro zone.

"There is a lot to do, but anyway Portugal and Spain are looking much more positive.Greece is the only problem we have left."

FLEXIBLE ON COALITION PARTNERS

He said he was open to any party in coalition. If his party wins the largest amount of votes, he would have to choose from three other main parties - The Finns, the ruling center-right National Coalition and the center-left Social Democrats, each with 15-17 percent in pre-election polls.

Some analysts say Sipila may find it easier to work with populists rather than Prime Minister Alexander Stubb's coalition, which has become unpopular after years of economic stagnation.

Sipila, a millionaire businessman with a background in startups, software and telecommunications, has won over many voters with his image of a technocrat outsider that can unite a country also troubled by Russian assertiveness in the region.

Growing up in northern Finland, Sipila belongs to "Word of Peace", part of a Lutheran revival movement that sets himself apart from many more secular-orientated political leaders.

Sipila toes a centrist line and is popular among many in the urban middle class. But many of his party grassroots are conservative and EU sceptics from Finland's rural population.

He proposes austerity, including a freeze on wages and cuts in Finland's welfare state, to improve competitiveness. But plans such as a 1.5 billion euro state fund to invest in startups have been criticized as heavily statist.

Sipila also said he supported EU sanctions against Russia over its role in Ukraine's separatist conflict, but called for more dialogue between the 28-nation bloc and the Kremlin.

Tags

Juha Sipila, Greece, EU, Portugal, Spain, Alexander Stubb, Finland

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