STOCKHOLM (Reuters) - Populist parties in the Nordic region, which seemed able to disrupt the European Union only last year, are losing support as the economic downturn overshadows immigration among voters and following a massacre staged by an anti-Islamic fanatic.
Less than a year ago, the rise of the anti-euro Finns party raised the possibility that Finland might block bailouts for struggling EU nations. In Denmark, the anti-immigration Danish People's Party was a coalition powerbroker irking the EU with plans for tough border controls.
But to the likely relief of Brussels, Sunday's Finnish presidential election was the latest sign that populist parties' influence is waning, as two pro-European candidates moved into the run-off while the Finns candidate came fourth.
"Looking at who made it to the second round, I think this was at least a success for an open Finland," Finnish Prime Minister Jyrki Katainen told Reuters.
"There are no easy answers for the euro crisis and all those problems, and we all have to consider those issues carefully," he said. "But anyway, these two are both defenders of an active and international Finland, and that is a good thing."
No one is discounting these populist parties that have challenged the region's image of moderate politics, provoking soul-searching in its cradle-to-grave social welfare model.
But the inexorable rise in anti-immigration, anti-euro parties has been broken, giving mainstream parties a confidence boost that may reverberate across Europe.
"This is not the time to get voters on immigration issues," said Daniel Poohl, editor of Expo magazine, an anti-racist publication that investigates far right politics. "The economic downturn in more of an issue."
"So far, far right parties have been unable to connect unemployment to immigration."
Denmark, Sweden and Finland face possible recession in 2012 as the euro crisis bites. But the downturn does not automatically translate into a rise in anti-immigration parties.
In Finland, the presidency has little power beyond military and diplomatic affairs but it is a highly symbolic post. Fears of a European-wide recession may have made voters wary of choosing a president who does not support the government.
The strength of the pro-euro vote will ease pressure on the government to take a hard line against Brussels despite scepticism over the bailouts for debt-ridden member states.
A NORDIC WAVE?
It is not just Finland. The Danish People's Party lost sway after a left-of-centre coalition took power. In Norway, the anti-immigration Progress Party was tainted by Anders Behring Breivik, a former member who massacred 77 people last July.
Sex scandals have also rocked Progress, along with a perception of fiscal recklessness. In 2009, Progress scored its best ever election result with 23 percent of votes but that fell to 11.4 percent support in local elections last autumn.
The anti-immigration Sweden Democrats have also failed to capitalise on the 2010 election, languishing in opinion polls.
Soul-searching about the Norwegian massacre and how extreme right-wing rhetoric on the Internet encouraged Breivik, appear to have spread across the Nordic countries.
In Finland, the Finns Party's internal problems began when one member used the word "neekeri", or "negro", and mockingly imitated a Muslim call to prayer in an online video.
This prompted debate about whether their election campaign had stirred xenophobia and racism in a country where fewer than five percent of people are immigrants.
Another party member, Jussi Halla-aho, was briefly suspended from a parliamentary group for a comment on Facebook suggesting that a military junta should restore order in Greece.
By contrast, one of the run-off candidates for the Finnish president is openly gay, successfully campaigning for tolerance.
WEAKENED BUT NOT OUT
But the weakness of far right policies does not mean anti-immigration sentiments, and the EU scepticism that often accompanies it, has gone away.
In the Finnish election, the two euro-sceptical candidates managed to win around a quarter of the vote between them - high for a country that has been a fervent EU supporter for years.
In Norway, which remains outside the EU, an opinion poll showed support for joining the bloc plunging to 12 percent while 72 percent oppose it.
In Denmark, some of the more mainstream parties have taken on policies of the Danish People's Party to win over voters.
"Anti-immigrant parties are losing support but the view they represent have not gone away," said Fredrik Erixon, director of European Centre for International Political Economy in Brussels.
"Established parties are taking on empty rhetoric without the intention of doing much. But this is a dangerous strategy."
(Additional reporting by John Acher in Copenhagen; Eero Vassinen and Jussi Rosendahl in Helsinki and Walter Gibbs in Oslo; Editing by David Stamp)
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