The head of Finland's Social Democratic Party Antti Rinne votes in the country's general election

Helsinki (AFP) - Finland’s leftist Social Democrats held a razor-thin lead over the far-right Finns Party in Sunday’s general election with 93.1 percent of votes counted.

The close result – with just a 0.2 percent share of the vote separating the two parties – will make negotiations to form the next coalition government particularly fraught.

The Social Democrats led by 56-year-old former trade union boss Antti Rinne picked up 40 seats after campaigning on a ticket of fierce opposition to the austerity imposed by the previous centre-right government.

The Finns Party, which won 39 seats, meanwhile focused almost entirely on an anti-immigration agenda, under the leadership of hardline MEP Jussi Halla-aho, who also decried the “climate hysteria” of the other parties.

A first-place spot would put the Social Democrats at the head of the government for the first time in 16 years.

The Finns Party has seen a surge in support in recent months, urging people to “Vote for some borders”, and pledging to reduce Finland’s asylum intake to “almost zero”.

Sunday’s result see the Finns Party more than double its presence in parliament, from 17 seats to at least 39, and regaining all of the ground it lost when more than half of Finns Party MPs fled the party in 2017 on the election of hardline leader Jussi Halla-aho.

During the campaign, most parties expressed strong reservations about sharing a government platform with Halla-aho’s party, though stopped short of ruling it out entirely.

Finnish governments are typically a coalition of three or four parties who form the minimum 101-seat majority in parliament.

The Social Democrats’ Antti Rinne has previously said his party would find it “very difficult” to enter a coalition with the Finns Party.

Meanwhile Petteri Orpo, leader of the conservative National Coalition, said his party was “ready to discuss” with Halla-aho.

- Biggest loser -

Outgoing Prime Minister Juha Sipila said his Centre Party was the night’s “biggest loser”, blaming the “difficult economic decisions” his administration made in an attempt to rebalance the economy after a long slump.

Voter turnout looked set to come in around 72 percent, higher than the 70.1 percent who voted in 2015.

People vote in the parliamentary elections, on April 14, 2019 at the city hall's polling station in Mantsala, Finland.Finns began voting in a general election where the centre-right government is expected to be overturned amid widespread opposition to its spending cuts, and the far-right is predicted to make large gains.

The current government’s cuts to Finland’s prized education system, and a tightening of unemployment benefit criteria, had provoked loud and widespread public opposition.

Rinne refused to speculate Sunday as to whether he would agree to form a government with the conservative National Coalition.

Rinne has been a staunch opponent of the National Coalition’s austerity policies over the past four years.

Petteri Orpo, leader of the conservative National Coalition Party and co-architect of the government’s savings programme, has denounced the Social Democratic Party’s anti-austerity plans as “irresponsible”.

However, in a tacit acknowledgement that the public mood is against further belt-tightening, Orpo has insisted that the economy is now strong enough to allow for some more generous public spending.

- Populist surge -

Opinion polls had suggested the Social Democrats’ lead had narrowed in recent weeks to as little as two points, ahead of the National Coalition and Finns Party.

Some blamed the shrinking lead on the inability of party leader Rinne to attract large numbers of new, younger voters.

The growing Finns Party ratings, on the other hand, appear to be driven by new supporters who have not voted in the past.

Jussi Halla-aho's far-right Finns Party has urged people to "vote for some borders"

Finns Party leader Halla-aho has sought to dispel accusations that he hopes to keep his party in opposition after the election, so as to avoid facing the tough decisions of being in power.

On Sunday he said his party was open to being in a coalition “but not at any cost”.

The Finns Party does have previous experience of being in government, when they became the second-largest party in the 2015 election. But that led to the group splitting acrimoniously when its popularity spiralled following unpopular compromises on immigration and EU bailouts.

The hardline faction, led by Halla-aho, went into opposition in 2017, and the party took a further lurch to the right.

Finland has a rapidly ageing population and declining birth rate, and the question of how to keep funding the country’s generous welfare state has been a key election battleground.

Immigration became a hot election topic following outrage in January over highly publicised reports of an alleged string of sexual assaults by immigrant men. The incidents boosted support for the Finns Party’s anti-immigration agenda.