Spain's Socialist government yesterday faced its first test of voter sentiment since the economy plunged into recession last year, when Galicia and the troubled Basque Country held regional elections.

In the northern Basque region, the vote takes place under the shadow of the armed separatist group ETA, which has condemned the polls and staged two bomb attacks last month.

Just hours before the polls opened, Basque police arrested a suspected ETA member they believe was planning a bomb attack timed to coincide with the vote.

The Socialist Party of Spanish Prime Minister José Luis Rodriguez Zapatero hopes to take power in the Basque region and be re-elected in Galicia.

But Spanish newspapers yesterday stressed the outcomes could be decided by just a small number of votes, and that a low turnout could lead to changes of government in both regions.

By midday, around 17 per cent of voters had cast ballots in the Basque Country, slightly more than in the last elections in 2005, but turnout was down by around three per cent in Galicia at 15.8 per cent, local officials said.

A total of around four million people are eligible to vote to elect regional Parliaments in what are the first elections since Mr Zapatero was returned to power one year ago for a second four-year term.

Since then, the global financial crisis has accelerated the collapse of Spain's property market after a decade-long boom, pushing the country into recession late last year.

The unemployment rate soared to 13.9 per cent in the last quarter of 2008, the highest in the 27-nation European Union.

In yesterday's polls, Mr Zapatero will be seeking to measure the degree of support for his measures to tackle the crisis, which include an €11-billion infrastructure plan to create over 300,000 jobs.

Exit polls indicated last night that the incumbent Basque Nationalist Party leads Spanish Prime Minister Jose Luis Zapatero's Socialists in yesterday's regional election.

The PNV is well positioned to form another coalition government with smaller nationalist parties to remain in power in the wealthy separatist-minded region bordering France. The PNV, which has ruled the region since 1980, captured between 30 and 32 seats in the 75-seat Basque Parliament compared to between 26 and 28 seats for the Socialists, the Ipsos poll for public television TVE found.

Analysts credit the rise in support for the Socialists in part to Mr Zapatero's bid during his first term to negotiate peace with ETA, blamed for 825 deaths in its 40-year campaign for an independent Basque homeland.

The tentative peace process collapsed when the group killed two people in a bomb attack at Madrid airport in December 2006.

Spain's Supreme Court last month banned two pro-independence parties from participating in yesterday's election due to their links to ETA and its outlawed political wing Batasuna.

The Basque interior ministry said it was deploying 5,000 police throughout the region Sunday, more than half of its entire force of 8,000, amid fears of new ETA attacks to coincide with the polls.