Spain's Sanchez threatens to quit. What are his options?

Pedro Sanchez’s decision to take several days to think about his future as Spain’s prime minister has left the euro-zone’s fourth-largest economy shrouded in political uncertainty.

The 52-year-old Socialist leader surprised even his closest allies on Wednesday when he said he was considering his position after a judge started an investigation into his wife for influence peddling. The inquiry follows a complaint filed by a small organization known for taking leftist politicians to courts and whose leader has ties to the far right.

The political chaos comes at a time the government should be enjoying the benefits of a solid economic performance. Spain is forecast to outperform the euro-area average for a fourth straight year in 2024.

Sanchez first became prime minister in 2018 and won a third term last year after haggling with a Catalan separatist group to secure enough support to form a government. Now, that administration is at risk of collapse, which could put Spain on course for another election and a divisive battle for votes between the left, the center-right, the far right and separatist groups.

Here are Sanchez’s main options:

Sanchez quits:

There are two paths here, one where Sanchez anoints a successor to try to hold his coalition together, or where he walks away, leaving his party in disarray with a vacuum at the top. Either way, a successor would require support from a majority of parliament to become premier.

The Socialists have no clear alternative leader with enough support for the party to rally around, and the government’s junior coalition partner, the far-left Sumar, has had abysmal showings in polls since its creation last year.

And while the Socialists hold sway — albeit barely — in the national parliament, Spain’s political set-up means it’s a far different story around the country. Most of the regions are governed by the conservative opposition People’s Party, the far-right is in a number of local coalitions, and nationalism has surged in the Basque country and Galicia. Catalonia is also scheduled to hold a crucial regional poll next month that could have broad implications for the entire country.

Snap election:

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