By Rebecca Howard
WELLINGTON, New Zealand--Prime Minister John Key is set to lead
New Zealand for a third consecutive term after his National Party
won 48% of the vote in Saturday's election.
Official results show Mr. Key's party will likely end up with 61
seats in a 121-member Parliament. While the National Party may be
able to govern alone with those numbers, Mr. Key said he stood
ready to work with like-minded parties, and that he'd be talking to
his current coalition parties over the next few days.
"People could see the country was headed in the right direction
and they rewarded us," the former investment banker said in a
televised interview Saturday night.
David Cunliffe, leader of the main opposition Labour Party,
conceded defeat. The Labour Party picked up 25% of the overall
vote, according to the Electoral Commission, while the Green Party,
thought to be its likeliest coalition partner, won 10%.
"New Zealanders have chosen to continue and we respect that
choice," Mr. Cunliffe told supporters. "Our opponents have built a
formidable electoral machine."
The 53-year-old Mr. Key has helped steer New Zealand to a level
of prosperity rarely found in developed countries since the global
financial crisis, campaigning against a backdrop of the strongest
economic growth in a decade.
The engine of its growth has been the nation's dairy industry,
which is feeding large parts of Asia, and a construction boom
fueled by rebuilding after a series of earthquakes in 2010 and
2011.
But the incoming government will face new challenges, with
growth projected to fall sharply over the coming years as the
rebuilding of Christchurch wraps up, prices for New Zealand's main
commodity exports fall and monetary conditions tighten.
Mr. Key has promised business as usual and has said his
government would balance the books this year after six years of
deficits. "Three more years. This is a victory for those who kept
the faith and refused to be distracted," Mr. Key told
supporters.
Markets are likely to be cheered by Mr. Key's win when they open
Monday. "It was a great victory for stability in New Zealand and
markets like stability," said Auckland-based ASB's head of FX
institutional sales, Tim Kelleher.
And Grant Williamson, a Christchurch-based broker for Hamilton
Hindin Green, said: "The market is just going to love that result.
It couldn't have been a better result. It removes all
uncertainty."
John Key's victory was stronger than opinion polls were
predicting. Meanwhile, Labour's weak showing was the worst in
decades, prompting speculation of a possible change in leadership,
though Mr. Cunliffe said he had no plans to resign. The Green
party's support was little changed from 2011.
The country of 4.5 million people has a multiparty system that
allows voters to choose both the party they want in government and
the candidate for their local electorate. That means governments
often rule with only the smallest of majorities. Governments under
New Zealand's proportional-representation system, similar to
Germany's, have always been coalitions.
It is unprecedented for any single party under the current
electoral system to secure a majority of seats in Parliament, as
Mr. Key's party appears to have done from votes counted Saturday.
Still, there remain certain special votes to be counted by Oct. 4,
though they wouldn't alter the overall result.
The scale of the win rules out the need for Mr. Key to do a deal
with New Zealand First, an anti-immigration party that in opinion
polls had at times looked likely to become kingmaker.
In government, Mr. Key fought off stiff opposition to the
partial privatization of various state-owned assets, and, during
the election campaign itself, allegations that his party covertly
used a right-wing blog to smear opponents--accusations that cost
the country's justice minister her job.
Mr. Key's support also held steady amid allegations by ex-U.S.
intelligence employee Edward Snowden that the government had
engaged in mass surveillance of its citizens, a charge the prime
minister strongly denied. Internet Mana, a party funded by online
entrepreneur Kim Dotcom, failed to win any seats.
Write to Rebecca Howard at rebecca.howard@wsj.com