Mark Rutte saw off a strong challenge from the far-right to clinch a third term in power
The Hague (AFP) - European leaders heaved a sigh of relief Thursday after the Dutch voted Prime Minister Mark Rutte's Liberal party back into power ahead of the far-right, with all eyes turning to polls later this year in France and Germany.
"The Dutch election carries the hope of success, not just in keeping Europe together but in... bringing together once again all of our citizens," said German Foreign Minister Sigmar Gabriel.
After the Brexit vote and Donald Trump's victory in the US, Wednesday's election was seen as a gauge of the rise of populism in Europe.
It was "a victory for common sense and a great start for Europe's election season," said Holger Schmieding, chief economist with Berenberg bank.
The fact that most Dutch voters had "rebuked the siren songs of the populists may help a little" before a French presidential vote in April and May, and a general election in September in Germany.
After flirting for some months with putting anti-Islam MP Geert Wilders at the helm of the country of 17 million people, in the end Dutch voters, who turned out in droves, opted for stability in one of the eurozone's biggest economies.
With 100 percent of votes counted, Rutte's Liberal VVD was seen as emerging as the largest party in the 150-seat parliament with 33 seats, public broadcaster NOS said according to its own tally.
That is about 21 percent of the vote and eight seats less than in the last election in 2012.
But officials acknowledged that as the largest group in the parliament the VVD had won the right to take the lead in seeking to form the next coalition.
- 'Far-right fascination over' -
Instead of knocking out Rutte, Wilders and his Freedom Party (PVV) came second with 20 seats, or roughly just 13 percent of the vote, NOS said.
Wilders however had reason to crow.
"We were the 3rd largest party of the Netherlands. Now we are the 2nd largest party. Next time we will be nr. 1!" he tweeted.
The leader of France's far-right National Front, Marine Le Pen, who called Wilders "a patriot" for his anti-immigration stand, is also seen as doing well enough in her country's presidential poll to reach the second round.
But analyst Hajo Funke, from Berlin's Free University, said the Dutch result showed "the fascination for the rise of right-wing populism in Europe is over".
People had seen right-wing populism "can destroy countries' economies and trigger a chain-reaction of destruction in Europe".
Rutte is unlikely to ask Wilders to join him in the new coalition, having been stabbed in the back in 2012 when the MP withdrew his support for the government over austerity talks, forcing a snap election.
"I think it will be difficult for them to negotiate about lot of issues. But I think within a couple of months we will see a centre-right government being formed with these results," Leiden University analyst Geerten Waling told AFP.
- Coalition talks -
All top party leaders gathered for the first time since the vote at the centuries-old Dutch parliament Thursday as outgoing health minister Edith Schippers was appointed to start the process of trying to see which parties could work together.
Rutte said the coalition-building could be "a complex formation" taking several weeks, as the programmes of different parties have to be married.
Wilders adopted a conciliatory tone, saying he was willing "to talk to everybody including Mr Rutte," and willing "to help govern".
"It's prudent to talk to us, because brushing us aside, as the second-largest party would not be a very good idea."
Rutte has however already ruled out working with Wilders again, and is more likely to turn to natural coalition partners the Christian Democratic Appeal (CDA) and Democracy party D66 which came joint third with 19 seats each.
Rutte plus the CDA and D66 would have 71 of the 76 seats needed for a parliamentary majority.
That means they would have to woo a fourth party for a centre-right coalition. Two contenders could be the Christian Union with five seats or the more orthodox Calvinist Reformed Political Party (SGP) which took three.
One of the biggest winners in the election was Jesse Klaver who has turned around the fortunes of his ecologist, left-wing party GroenLinks.
The charismatic leader appears to have drawn huge support among younger voters, and boosted his party from just four seats to 14. But it remains unclear if he would agree to work in a coalition dominated by centre-right parties.