A few years ago, a far-right anti-Islam party winning the second most seats in the Netherlands election would be a cause for panic in the European Union. In 2017, its being hailed as a great victory for liberalism.

The Dutch elections on Wednesday saw center-right Prime Minister Mark Rutte fend off a challenge from far-right populist Geert Wilders and gain the largest share of the vote. The result sets up lengthy coalition talks between Rutte and some of the dozen-plus parties that managed to gain seats in Parliament, which will create a ruling government certain to exclude Wilders.

Wilders Party for Freedom, or PVV, came in a distant second behind Ruttes VVD, and finished just one seat ahead of two ascendant progressive parties. It gained five seats more than it did last election, but fell far short of poll predictions just a few weeks ago that showed the party on track to become the largest in the country.

Pro-EU politicians have immediately seized on Wilders somewhat disappointing finish as a rebuttal to the far-rights narrative that an inevitable populist uprising is taking place in Europe. After the U.S. election and Brexit referendum last year, France and Germany met the lack of a populist surge in the Netherlands with a sigh of relief, despite still-substantial popular support for Wilders. Both states are dealing with rising far-right parties ahead of their own elections later this year.

The Netherlands is showing us that a breakthrough for the extreme right is not a foregone conclusion and that progressives are gaining momentum, said French independent leader Emmanuel Macron. He is expected to face off against far-right leader Marine Le Pen in the final round of Frances presidential elections in early May.

Large majority of Dutch voters have rejected anti European populists. Thats good news, Germanys Foreign Office posted on its Twitter account. German Chancellor Angela Merkel and the former president of the European Parliament, Martin Schulz, both congratulated Rutte on the result.

But while many pro-EU politicians celebrated the Dutch election as a defeat for Europes right-wing populist movement, it was about far more than just Wilders. Instead, the vote reflected a number of huge shifts in Dutch domestic politics that could threaten the long-term stability of its political system.