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Last Updated: Monday, 10 April 2006, 18:43 GMT 19:43 UK
Hungary Socialists in narrow lead
Hungarian women, wearing traditional dress, vote in polling station in Holloko
Hungary's Socialists have taken an early lead
Hungary's governing Socialists have taken a narrow lead after the first round of the general election despite a strong challenge from conservatives.

The final outcome of the elections will be decided after a second round of voting on 23 April.

The two main parties are rallying supporters ahead of the second vote.

The next government faces the task of tackling a soaring budget deficit, rising unemployment and a weakening of the currency, the forint.

The elections are Hungary's first as a member of the European Union.

'Rollercoaster ride'

The Socialists (MSZP) won 43.2% of Sunday's vote, while the centre-right Fidesz (Hungarian Civic Union) party won 42%.

Prime Minister Ferenc Gyurcsany
Ferenc Gyurcsany was in business before entering politics
Two other parties have passed the 5% threshold to enter parliament and are expected to drive hard bargains in order to form any coalition.

The liberal Free Democrats and the conservative Democratic Forum could be called upon to form a government by either the Socialists or Fidesz.

The BBC's Nick Thorpe in Budapest says this was a rollercoaster ride for Hungarian democracy - a governing party clinging to the power it won four years ago, an opposition battling to reach almost a dead heat and two potential king-makers in the second round.

More voters than expected cast ballots.

It is Hungary's fifth parliamentary election since the return of democracy in 1990.

Standing firm

Prime Minister Ferenc Gyurcsany, 44, has tried to combine free markets and privatisations with a welfare system to help Hungary's poor. He was a millionaire businessman before entering politics.

The conservative Fidesz of ex-Prime Minister Viktor Orban has advocated more protectionist policies to help Hungarian entrepreneurs.

The Democratic Forum's leader Ibolya David said she would only serve in a coalition if she was able to serve as prime minister.

Experts say far-reaching reforms are needed to prepare Hungary for adoption of the euro as planned in 2010.

Hungary's complicated electoral system combines a British first-past-the-post model with proportional representation.

Streamlined blocs

Slightly less than half the 386 seats in the single chamber are decided in individual constituencies.

District and national party lists also contribute to the final composition.

But despite its complexity, the Hungarian political scene has witnessed a growing streamlining over the years.

Two major parties have emerged: the Socialists and their arch-rivals Fidesz.

This election has become a battle between the very different personalities of Mr Gyurcsany and Mr Orban, a former student activist who has marshalled almost the whole centre-right of Hungarian politics behind him.


BBC NEWS: VIDEO AND AUDIO
See the challengers in the Hungary election



SEE ALSO:
Hungary struggles to compete
11 Apr 06 |  Europe
Q&A: Hungary election
07 Apr 06 |  Europe
Country profile: Hungary
19 Mar 06 |  Country profiles
Timeline: Hungary
12 Oct 05 |  Country profiles


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