Lithuanian opposition parties to form coalition government

Lithuanian politics were in turmoil yesterday after the president moved to block three opposition parties from forming a new government because one of them is accused of vote buying and fraudulent financing.

The unexpected development complicated coalition talks after Sunday's parliamentary election, which saw the centre-right government punished by austerity-weary voters in the recession-scarred Baltic nation.

The main opposition Social Democrats won the vote and announced plans to form a left-leaning government with the Labour Party, which finished third, and the fourth-placed Order and Justice party.

But President Dalia Grybauskaite, a former EU budget commissioner, said she couldn't accept a government that included Labour due to the fraud allegations against it.

Lithuanian prosecutors and election officials have accused at least two Labour Party members of vote buying. In addition, Russian-born party leader Viktor Uspaskich is under criminal investigation for his alleged role in fraudulent party financing.

Uspaskich, who had to resign as economy minister in 2006 for a conflict-of-interest case involving business in Russia, was indignant.