Romanian Prime Minister and presidential candidate Victor Ponta addresses the media after seeing the exit poll results in the first round of presidential elections on November 2, 2014, in Bucharest
Bucharest (AFP) - Romania's Prime Minister Victor Ponta led the first round of the presidential election according to near-complete results on Monday, but he was pushed harder than expected by his conservative rival.
The European Union is watching the election closely because of fears that Ponta could reverse reforms aimed at tackling rampant corruption in one of the bloc's poorest countries.
Official results from Sunday's voting showed Ponta, a social democrat, took just over 40 percent of the vote after 98 percent of the ballots were counted.
"I am delighted that so many Romanians have voiced confidence in my programme which aims at developing Romania and ending discord," 42-year-old Ponta said.
But the race is tighter than expected, with his main rival, 55-year-old liberal Klaus Iohannis from the German-speaking minority, on 30.4 percent.
The second round will take place on November 16.
Analyst Mircea Kivu said the outcome was far from clear.
"There is still a lot to play for in the second round. Much depends on the instructions given by candidates eliminated in the first round," Kivu said.
Alina Mungiu-Pippidi of the Hertie School of Governance in Berlin said an increase in turnout from urban areas could push Iohannis over the top.
"If four to five percent more people from urban areas come out to vote in the second round, Klaus Iohannis will win," she told AFP.
The vote is seen as a crucial test for the former communist country at a time when democracy has suffered setbacks in some neighbouring states such as Hungary, and as the Ukraine crisis has shaken relations between the European Union and Russia.
The election campaign has been marred by scandal, with numerous corruption probes including some aimed at allies of the prime minister, and a settling of scores between Ponta and his long-standing rival President Traian Basescu.
The popular centre-right Basescu, who has accused Ponta of being a former spy, cannot run for a third term. He and Ponta have shared two stormy years at the top of Romanian politics.
-- 'Maturity test' --
Whoever takes over the presidency will face pressing issues including recession and persistent accusations of corruption and bad governance.
Romania's head of state is responsible for foreign policy and top-level appointments such as prosecutors in the second poorest EU country after Bulgaria.
"I think these elections can be a maturity test for Romania," said Corina Rebegea from the Centre for European Policy Analysis in Washington.
The country needs "a president who can imprint a clear sense of vision about how we continue to build a democratic system of governance and rule of law, and prove that 25 years of transition are worth something."
Despite progress in reforming the justice system -- which has even seen a former minister jailed for corruption -- many fear a backlash is coming.
- Quick reforms needed -
Although Ponta has vowed to keep the justice system independent, his frequent accusations that the prosecution authority known as DNA is biased has stirred trouble.
On what was dubbed "Black Tuesday" in December last year, Ponta's government passed a series of new laws granting immunity to elected officials.
The changes were ultimately blocked but Ponta's critics said the episode served as a wake-up call.
Experts hope increased surveillance from Brussels will act as a safeguard against any regression.
After two paralysing years of cohabitation, Romania needs to carry out reforms quickly, particularly in public administration.
The recession-hit economy is also desperately in need of a boost in a country where the average monthly salary is 380 euros ($480) and more than a fifth of under-25s are unemployed.
"I hope the next president will work to give young people a chance, and to boost small businesses which are the ones carrying the heaviest burden -- taxes are too much," said Elena Pascu, a 57-year-old accountant voting Sunday in Bucharest.
Foreign investment has dropped in the past five quarters, mainly due to Romania's chronic incapacity to manage investment programmes or correctly use European funds, said Gabor Hunya of the Vienna Institute for International Economic Studies.
Economic growth is expected to slow to 2.2 percent this year from 3.5 percent in 2013.