Veteran leader Gruevski has narrow lead in Macedonian election

By Ivana Sekularac and Kole Casule SKOPJE (Reuters) - Macedonia looked set for a close finish on Sunday to snap elections called to end a crisis over allegations of government corruption, as veteran nationalist leader Nikola Gruevski took a narrow lead with just over half of the votes counted. Gruevski's centre-right VMRO-DPMNE party won 38.9 percent of the votes counted by midnight local time (2300 GMT), with the main opposition Social Democrat SDSM at 36.3 percent, the country's state electoral commission said. A final result is expected around midday on Monday. The parliamentary elections came almost a year after Gruevski stepped down as prime minister in an EU-brokered deal to end a crisis over a long-standing corruption scandal. Gruevski's main challenger is Zoran Zaev, head of the SDSM, who accused the government last year of wiretapping tens of thousands of citizens and released recordings appearing to implicate the government in corruption. Gruevski has denied any wrongdoing. The SDSM was celebrating what it said was its victory in bigger cities on Sunday night, while the VMRO-DPMNE said it won more votes in smaller municipalities. The centre-right VMRO-DPMNE party had ruled on its own or as the major coalition party since 2006 until the installation of a caretaker government and the calling of early elections in January of this year. The interim government was installed under the terms of a European Union-brokered deal to end the political crisis in the landlocked nation of 2.1 million people. In Romania, the leftist Social Democrats, also seeking re-election after stepping down a year ago amid street protests over its failure to address corruption, were in position to form a coalition government again on Sunday. Early elections were postponed twice in Macedonia after the opposition boycotted them, demanding measures to ensure voting would be free and fair. Many Macedonian observers reported irregularities at polling stations, including an official campaigning for a political party. Some voters were found using phone cameras to record their ballots in case they needed to show how they voted later. "I am hoping that this madness will stop after the election. I hope a better party will win," said unemployed 52-year-old Orde Serafimovski casting his vote earlier in the day. The European Union had long criticised Gruevski's record on democracy and the rule of law, but also needs Macedonia's cooperation to help contain the bloc's migration crisis. The country sits on a major migration route into the bloc. Macedonia is a candidate to join the European Union but has never begun accession talks, partly because of criticism of its reform record and because of an entrenched dispute with neighbouring EU member Greece over the name Macedonia, which also belongs to a northern Greek province. Eleven parties and coalitions ran for election, including four representing the ethnic Albanian community, which accounts for around a third of the population. Traditionally, an Albanian party joins a coalition government as junior partner. Toni Mihajlovski, a 52-year-old vendor at a market in Skopje, said he feared Albanians being given more autonomy and the government making concessions over the name issue to get EU membership talks started. "I am hoping that VMRO will win," he said. "I am afraid if the other party wins there would be no Macedonia." The polls closed at 7 p.m. (1800 GMT). (Writing by Georgina Prodhan; Editing by Tom Heneghan and Will Dunham)