MADRID — The prospect of far-left party Podemos getting anywhere near power has accomplished a rare feat in Spain: Business leaders now see Socialist Pedro Sánchez as their champion and want him to run the government.

To a business community that traditionally favors tax cuts and flexible labor rules, a coalition led by Sánchez that excludes Podemos and avoids new elections is the best of the bad political options on the table — even if he's promising new taxes and more assistance for the poor.

This is one of the more awkward twists in Spain’s seemingly endless efforts to form a government since December’s indecisive elections created the most fragmented parliament in its recent history.

Sánchez, leader of the Socialist Workers' Party (PSOE), will try to get enough support in parliament this week to become the country's new prime minister, after sealing a coalition deal last week with Alberto Rivera's centrist Ciudadanos (Citizens).

Company chiefs like Miguel Mesquida, who runs a factory on the outskirts of Madrid and has always voted for Prime Minister Mariano Rajoy's conservative Popular Party (PP), now find themselves urging the PP to step aside and facilitate a coalition led by the Socialists to restore stability and keep Podemos out of power.

The PP came first in December's vote but without a majority that would have given Rajoy a second term — the ideal scenario for most business leaders like Mesquida, whose company, Cele, employs 45 people making high-performance cables for trains, ships, energy stations and health equipment for big businesses like Siemens.

Cele survived Spain's worst economic crisis in decades by looking abroad, growing exports grew from nearly 20 percent of its €6 million revenue in 2008 to around 55 percent now. Spain's economy grow 3.2 percent in 2015 and put 680,000 unemployed people back to work. Now sales have been hit by a political stalemate that has frozen public works and private investments, bringing Mesquida another worry: the rise of Podemos.

"If the situation keeps going wrong, I will not be thinking about exporting my productions, but about exporting my company," said 47-year-old Mesquida.

It is a fear shared by many small and medium enterprises like Mesquida's.

The agreement between PSOE and Ciudadanos creates the biggest block in parliament with 130 seats, but that's short of the 176-seat absolute majority needed to form a government. In order to become prime minister, Sánchez needs either the PP, with 123 deputies, or Podemos, with 65 seats, to not vote against the creation of his government.

Rajoy and Iglesias have both said they will vote 'no' to the Socialist leader’s candidacy, though not before Podemos offered the PSOE a coalition deal that included Iglesias becoming deputy prime minister, a binding referendum on Catalan independence, and a €96 billion increase in public spending. For the PSOE as much as for the PP, which are as opposed to breaking up Spain as they are to undoing its hard-won economic recovery, such conditions were completely unacceptable.

If Rajoy and Iglesias stick to their guns, Sánchez will fail to become prime minister in two votes on March 2 and 5. Negotiations will then continue for two months before new elections are called — an outcome that most political pundits now consider likely. That would favor Podemos, who have gained ground since the elections in December and are on track to overtake the Socialists to take second place behind the PP, according to recent polls.

Javier Vega de Seoane, president of the Círculo de Empresarios, a business think-tank, said his favored option would have been continued PP rule but in the current political circumstances — with the PP's popular standing hurt by a flurry of corruption cases involving the party's leading figures — Rajoy's abstention is the “perfect” solution.

“Podemos’ plans to increase public spending by €96 billion in four years are absolutely unfeasible and indicate a loss of sense of reality due to an ideological drunkenness,” he said.

“We’re facing a critical moment,” said Celia Ferrero, vice-president of ATA, an association of the self-employed. She said she regards the PSOE-Ciudadanos deal as very positive, and Podemos' ideas as frightening. “Spain needs a government as soon as possible and some sort of continuity in economic policy.”

“Our problem is that we lack a coalition culture,” said Robert Tornabell, a professor at the Esade business school, adding that the political uncertainty is taking a toll on the Spanish economy and will become worse in the coming months.

Rajoy has little incentive to help bring to power a Socialist government, as it could fatally undermine his leadership of the PP. For the PSOE, which had its worst-ever national election result in the party's 130-year history in December, any accommodation with the PP could cause further push disenchanted leftist votes toward Podemos, which is challenging the PSOE to be the voice of the Spanish left. If, on the other hand, new elections are called, the Socialists risk being overtaken by the upstart hardliners.

The fate of Europe’s fifth biggest economy depends on what happens in the coming weeks. Spain’s growth outpaced most of its European peers last year, but its public deficit exceeded the European Commission’s target and public debt stood at around 100 percent of GDP. Most worryingly, unemployment is still over 20 percent, one of the highest among developed economies, in spite of a record-breaking reduction last year.

In the last four years, the country has gone through a €40 billion bank bailout, sharp cutbacks in public services and reforms in the workplace to make it easier to hire and fire. This has stabilized the economy but provided ammunition for Podemos, an anti-establishment, anti-austerity and anti-wealth movement for which more than 5 million Spaniards voted in December.

Iván Ayala, a member of Podemos’ economic team, says Spain has prioritized deficit reduction until now and his party wants to change the focus to job creation. “We don’t want less spending, but more income,” he said.

Aware of the backlash against its hardline positions, Podemos has moderated its message since its creation two years ago. However, the now-abandoned Iglesias slogan "Fear needs to change sides" neatly sums up the party's challenges in convincing the corporate sector, and the Spanish establishment more broadly, that it is not a threat.

At the Cele factory, Mesquida said that many small business leaders like him remain afraid of Podemos.

“We’re the only ones they can squeeze for money,” he said. “Big corporations have many ways of diverting their profits wherever they please.”

Mesquida, whose sister has set up a branch of the family firm in the United States, said the idea of emigrating and leaving everything behind is no idle threat, though he would have regrets: “The thing is that I can go earn a living abroad, but the workers may not be able to do so.”