REUTERS - Portuguese Socialist Prime Minister Jose Socrates won a second term in a general election on Sunday but, as expected, his centre-left party fell short of an absolute majority in parliament, exit polls showed.
Socrates, 52, won about 38 percent of the vote, cutting his share of the ballot from 45 percent in 2005, which had given him a solid absolute majority in parliament during his first term.
SIC television projected the result would give the Socialists between 99 and 103 seats in the 230-seat parliament.
"If these projections are confirmed, the Socialists were victorious," Social Security Minister Jose Vieira da Silva said in a televised speech shortly after exit polls were released.
Socrates's challenger, Manuela Ferreira Leite, 68, leader of the centre-right Social Democrats, who had campaigned for vigorous public sector spending cuts, garnered around 29 percent of the vote, virtually unchanged from the party's count in 2005.
The Left Bloc was the biggest gainer from the last election, rising to 10 percent compared with 6.3 percent in 2005.
The exit poll results, which were in line with opinion polls ahead of the election, sets out a potentially tough task for Socrates as he considers whether to enter into a coalition or rule in a minority government.
Ruling with a minority would likely curb Socrates' ability to carry out ambitious reforms or undertake big infrastructure projects at a time of the worst economic downturn in decades and the highest jobless rate since the 1980s.
Former Socialist Prime Antonio Guterres ruled with a minority for a full term.
Analysts say Socialists and Social Democrats may have to cooperate on some issues, particularly on public finance and the 2010 budget.
On other matters, such as social reform, the Socialists may turn to left-wing parties. Socrates, like the left, sees a bigger government role in the economy, with projects to create jobs.
The left staunchly opposes Socrates's market-friendly economic policies, including privatisation.
Socrates has advocated a series of big, vote-winning infrastructure projects, such as a high-speed train link to Spain and a new Lisbon airport to boost jobs and promote robust economic growth.
This year the economy is expected to contract by up to 4 percent.