Sawt Falasteen - Left-wing separatist Bildu eyes historic win in Basque vote

The outcome could leave Prime Minister Pedro Sanchez's ruling Socialist Worker's party in the difficult position of having to decide between two key parliamentary allies.

Polls predict a victory for EH Bildu, a coalition which has worked to disassociate itself from ETA whose bloody struggle for an independent Basque homeland claimed 850 lives before it rejected violence in 2011.

More than 700 polling stations opened at 9:00 am (0700 GMT) with some 1.8 million voters eligible to cast their ballots for 75 lawmakers in the Basque regional parliament. Voting closes at 8:00 pm.

With a large following among young people thanks to its strong stance on social issues, Bildu has climbed steadily in the polls and now looks set to win the most votes.

"We are facing an opportunity for a change that leaves behind outdated policies and ways of doing politics, and that reverses the sense of inertia," Bildu's candidate for regional leader, Pello Otxandiano, told reporters after voting in his home town of Otxandio.

If polls are correct, Bildu looks set for a historic win, inching ahead of separatist Basque Nationalist Party (PNV), a centrist faction that has ruled the region for decades.

"Before, the only party looking after Basque interests was the PNV, so everyone voted for them regardless of their political leanings," 40-year-old social worker Elena Garcia, 40, told AFP in Bilbao, saying the ETA era was now well in the past.

"But now if you are left-wing and more socially minded, you will vote for Bildu," Garcia added.

- Socialists as kingmaker -

Surveys indicate it will be a tight race with neither party set to win an absolute majority, leaving the regional branch of the Socialist party as kingmaker.

Sanchez's Socialist-led government relies on key support from a network of regional allies, including both the PNV and Bildu, to govern, meaning the decision could cost him.

But Eurasia Group analyst Federico Santi said it was "unlikely that the result of the election would threaten the stability of (Sanchez's) government".

Until now, the PNV has governed the Basque Country in coalition with the Socialists, who have already ruled out supporting Bildu, whose leader, Arnaldo Otegi, was convicted of ETA membership but later credited with helping steer the group away from violence.

"Condemning terrorism is (Bildu's) outstanding debt to Basque society and as long as they do not do that... we will not make any type of deal with them," the Socialist candidate Eneko Andueza told public radio.

Throughout the campaign, the issue hardly came up until earlier this week, when Otxandiano caused anger when he failed to call ETA a "terrorist organisation", referring to it only as an "armed group".

"Even if Bildu wins, it will not be able to govern because no party will be willing to make an alliance with it," said Pablo Simon, a political scientist from Madrid's Carlos III University.

- A wealthy region -

With 2.2 million residents, the Basque Country has the second highest regional income per capita in Spain, after Madrid, which averages around 36,000 euros ($38,400).

Its economy accounts for 5.9 percent of Spain's gross domestic product, ranking fifth of Spain's 17 regions, CaixaBank research figures indicate.

It is also the region with the lowest unemployment figure in Spain at 7.9 percent, according to Basque government figures.

The father of Basque nationalism was Sabino Arana, who set up the PNV in 1895. His ultra-Catholic, anti-Spanish ideology grew out of his vehement opposition to the thousands of Spaniards flocking to the area as a result of the industrial revolution.

ETA emerged in 1959 out of a split within the PNV's youth movement who were angered by what they saw as the party's inability to stand up to Francisco Franco's dictatorship.

In its first recorded act of bloodshed, ETA militants shot dead a policeman on June 7, 1968 in the city of Villabona, according to Spanish interior ministry documents.

A.AlHaj--SF-PST