The Danish elections on June 18 proved to be closer and more unpredictable than anyone expected. The center-left government under Prime Minister Helle Thorning Schmidt of the Social Democrats has been highly unpopular for several years, trailing in the polls after implementing a privatization program, cutting social protections, and failing to deliver on campaign promises. Despite gaining seats in the election, Thorning Schmidt’s broader “red” coalition lost to the “blue” coalition led by Venstre, the Liberal Party.

However, the blue coalition — helmed by the relatively unpopular Lars Løkke Rasmussen — won by a narrow margin, and owed its victory to strong support for the populist right-wing Danish People’s Party (DPP). Venstre’s hope for a coalition between the right parties quickly broke down, so the result will be a single party government under Venstre, which got only 19.5% of the vote.

With such a weak position it will be hard for the new government to get its program of tax cuts and benefits reductions benefits through parliament, but a dramatic policy shift from the former center-left government is unlikely. While Denmark is not a euro country, it abides strictly to the limits to fiscal policy set by the financial pact, and the previous government, led by the Social Democrats, implemented neoliberal reforms and strict immigration controls.