Iceland In Talks For New Coalition Government

Iceland, mired in financial crisis and all but bankrupt, is forming a new coalition government to fill the void left by Prime Minister Geir Haarde's resignation yesterday, the world's first leader to step down because of the global financial crisis, according to the Iceland Review.

Iceland's president has asked the country's Social Democratic Alliance and other major parties to join together in talks for a coalition government, reported Al-Jazeera English.

Iceland's president has asked Ingibjorg Gisladottir, leader of the Social Democratic Alliance, to form a new ruling coalition, following the collapse of the country's government on Monday.

Olafur Ragnar Grimsson said he had "decided to ask the leaders of the Social Democratic Alliance and the Left-Green party to engage in conversation about forming a new minority government backed by the Progressive party."

The Guardian reported the PM's resignation, attributing his stepping down to the fact that Iceland is almost bankrupt and the numerous violent protests against PM Haarde in recent days.

Yesterday he threw in the towel, saying that his Independence party and its Social Democratic Alliance partners were quitting immediately as he could not accept a demand by the Alliance to take over the premiership.

"What I have feared the most has come to pass, we now have a governmental crisis on top of the economic one,"Haarde said.

The Social Democrats are pushing for a referendum on EU membership for Iceland on May 30 and are asking for the parliamentary elections -- originally scheduled for May 9 -- to be held on the same day, the Iceland Review also reported. The Left-Greens, however, want elections to be held as soon as possible.

Comments

[Peter007]

04:18 PM on 01/27/2009

I don't understand why Iceland doesn't start a massive road and bridge building stimulus program. They need to invest in Green Energy. If they don't have the money they can print it.

[Bjarni]

02:23 PM on 01/27/2009

I pray my countrymen don't join the more corrupt EU.
If people in the US think they have little power over their representative in Washington, imagine if you didn't elect the people from your state that are in Washington, that's a perfect image of the EU who currently make up over 70% of the new laws passed in it's member countries.

[lisa12345]

03:46 AM on 01/28/2009

I agree with you and I worry as I read more and more commentary from the Left. They do not understand the whole situation, the Union has its plusses but it is not really liberal. Unless you are the kind of liberal who wants to give up freedom for security that is really faux-security. people on the left do not understand that the Union is taking away their power, taking away their democracy. I love Iceland, I have been a "fan" since my early twenties, over ten years. I love to see the attention they have gained over the years, even though I also feel protective of them--I know that is silly, but they felt like "my find". Silly, yes. But I hope they do not join the EU, it is against so much that they stand for. They are "common good" people, but they are also people who are fiercely independent.