New Zealand PM negotiates to form new government

AP News
Posted: Nov 28, 2011 6:11 AM
New Zealand PM negotiates to form new government

New Zealand Prime Minister John Key is negotiating with smaller parties to form a new government.

Key's National Party won a convincing victory in Saturday's election but fell short of being able to govern alone. That means National will seek support from at least one smaller party on spending and confidence votes.

Key scheduled meetings Monday with representatives from the United Future, Maori and Act parties, which may seek policy concessions in exchange for support. Key, who returns for a second term as prime minister, collaborated with all three parties during his first term.

Meanwhile, markets reacted positively Monday to the election result, sending the New Zealand dollar higher by more than 1 percent to 75 cents.