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24 September 2017, 12:24 | Tara Lloyd
Labour Party leader Jacinda Ardern has attended her grandmother's funeral ahead of NZ's election
New Zealand's cliffhanger election ended in a stalemate yesterday, leaving it up to a small, anti-immigration party led by a maverick populist to decide whether conservative Prime Minister Bill English or his youthful Labour challenger Jacinda Ardern forms the government.
By 11pm (9pm AEST) National leader Bill English was yet to address the crowd of hundreds at his campaign event, but former prime minister John Key had declared the party's result "phenomenal".
New Zealand uses a German-style proportional representation system in which a party, or combination of parties, needs 61 of Parliament's 120 members - usually about 48 percent of the vote - to form a government.
"The final fight at midnight will still be in the hands of New Zealand First", Jim Peters said.
Coalitions are nothing new for National, which has run a minority government since 2008.
"This has been an incredibly engaging and colorful campaign for New Zealanders and that isn't going to be over at midnight", said Bryce Edwards, an analyst at Wellington-based Critical Politics.
In contrast, the 55-year-old Mr English was bullish about his chances of securing a fourth-term government for National, a feat that has not been achieved in New Zealand in more than 50 years.
Ardern had enjoyed a remarkable surge in popularity since taking over as opposition leader last month.
Ardern is bidding to become New Zealand's youngest leader since 1856 and only the third woman to lead the South Pacific nation of 4.6 million people. The Green Party typically aligns with the liberal Labour Party. With 15 percent of the vote counted, National's Matt King is leading over Mr Peters by around 100 votes.
Peters, a political veteran whose fiery rhetoric has seen him compared to US President Donald Trump, knows how to extract the most from coalition negotiations.
The election was largely focused on the economy, with National attempting to highlight its positive record, and housing prices, a key topic of attack for Labour. That will likely have implications for the New Zealand dollar, the world's 11th most-traded currency in 2016. Labour had promised to build 100,000 new affordable homes if elected.
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