Swedish Greens want two-party government with Social Democrats, nuclear possible hurdle

STOCKHOLM (Reuters) - Sweden's Green Party hopes to form a two-party government with the opposition Social Democrats after a general election on Sept. 14, one of its leaders said on Saturday, though nuclear power could be a stumbling block in negotiations. The Social Democrats, Green and Left parties held just a 4.5 point lead over the Alliance government according to one poll on Friday, making it unlikely the Social Democrats and Greens could form a stable administration alone. A second opinion poll on the same day, however, showed the three centre-left parties in an 11.6 percentage point lead. "We are working to form a government consisting of us and the Social Democrats," Gustav Fridolin, one the Green Party's two spokespeople said in an interview. "But we are open to talks if that wouldn't suffice, including talks about forming a government with more parties." Fridolin said the Left Party, the Centre or the Liberal parties were possible partners. The two latter are junior members of the incumbent government. The Social Democrats have been coy about how they would form a government if they are the biggest party after the election. Social Democrat leader Stefan Lofven has said the Greens are a "natural partner" but has held his distance from the Left Party, which wants to raise income and corporate taxes and exclude for-profit companies from welfare provision. Lofven has held out an olive branch to the Centre and Liberal parties - both part of the current government - but they have rebuffed him. One of Friday's polls gave the three opposition parties 45.0 percent to Alliance's 40.5 percent. The second gave them 48.5 to the government parties' 36.9 percent. In both polls the anti-immigrant Sweden Democrats were above 10 percent. They have voted mostly with the Alliance over the last four years, making the prospects of a strong centre-left government still unclear. Even if the Social Democrats and Greens win enough votes to hold a majority in parliament, there remain many points on which the two parties differ. One key area is nuclear power, which accounts for around 40 percent of Sweden's electricity production. The Green Party wants Sweden to continue to shut down ageing nuclear plants. "Our demand is that at least two reactors are decommissioned during the next legislature," Fridolin said. Lofven has said his party does "not intend to make any such decision". He has not said whether he would support building more reactors on the site of old ones, an option after parliament passed such a bill in 2010. "That we would sit in a government which builds new reactors is completely impossible," Fridolin said. Sweden has 10 nuclear reactors and has shut down two. Another point of conflict could be labour laws. The Social Democrats want to tighten rules to prevent companies from employing cheap foreign labour and avoiding industry-wide agreements on wages and conditions. Fridolin said the Greens would not contribute to anything that made Sweden - one of the most liberal countries in the OECD when it comes to labour migration - "a more closed country". He was open to changing laws to prevent migrant workers from being exploited, "but not to prevent people from coming here." (Reporting by Daniel Dickson; Editing by Simon Johnson and Rosalind Russell)