Spanish PM says will not stand in 2012 elections

Spanish Prime Minister Jose Luis Rodríguez Zapatero, his popularity hammered by the euro zone's highest jobless rate, said he would not seek a third term in 2012 elections his Socialists are expected to lose.

Popular Deputy Prime Minister Alfredo Pérez Rubalcaba and Defence Minister Carme Chacon are seen as possible successors to revive the ruling Socialists, who trail the centre-right opposition Popular Party by up to 15 points in opinion polls.

"I will not be a candidate in the next general elections," Zapatero told the Socialist's Federal Committee meeting. The announcement was widely expected.

But the Socialists' leader said he would serve out the remainder of his term and focus on carrying out his programme of reforms to overhaul Spain's sickly economy.

Zapatero, 50 and in office since 2004, saw his popularity plunge as he imposed spending cuts and economic reforms to keep Spain from spiralling into a fiscal crisis and following Greece and Ireland into a European Union bailout.

The euro zone's fourth largest economy came under attack in bond markets after a real estate bubble burst in 2008, causing a recession and 20 percent unemployment. Spain's recovery has lagged behind the rest of Europe.

There are some parallels with Portugal, where political turmoil last month brought down the government.

Like Portuguese Prime Minister Jose Sócrates, Zapatero's government also lacks a majority.

The Popular Party has pledged to deepen spending cuts and trim what it says is more fat from public administration if it wins power. Polls show the PP winning general elections if they were held now, even though PP leader Mariano Rajoy is not much more popular than Zapatero.

The PP also is expected to do well in local and regional elections on May 22. The Socialists hope Zapatero's announcement will help the party regain some credibility and recover votes.