Iceland’s centre-right parties agree to form government; EU vote eyed

Independence Party chief Bjarni Benediktsson. [Bjarni Benediktsson]

Iceland’s centre-right Independence, Reform and Bright Future parties have agreed to form a coalition government and will give parliament a vote on whether to hold a referendum on joining the European Union.

Together, the coalition will hold 32 of the 63 seats in parliament. The Independence Party will have 21 seats, making it the largest party in the coalition. However, it opposes EU membership while the other two parties both favour it.

The Independence and Reform parties accepted the agreement on Monday (9 January), Icelandic media reported. Bright Future said it had backed the deal in a vote overnight. The agreement ends a political impasse since a general election in October.

Iceland tempted once more by EU membership bait

Iceland could hold a referendum on joining the EU if new negotiations on forming a coalition government are successful, the head of one of the three parties involved in the political talks said today (2 January).

“The agreement was, after a discussion, voted on by the management by electronic voting and was accepted by the party,” Bright Future spokesman Unsteinn Johannsson said.

In November, the three parties abandoned an attempt to form a coalition. The Left Greens and the Pirate Party also made unsuccessful attempts to form a government before the mandate was returned to the Independence Party .

Iceland applied to join the EU in 2009, a year after a banking crash left the country on the verge of bankruptcy. The crash led many to argue it should have closer ties with Europe and even join the single currency to shield it from future crises.

Iceland, already a member of the European Free Trade Association (EFTA), later shelved the talks.

Iceland PM steps down after Panama Papers tax scandal

Iceland’s Prime Minister Sigmundur David Gunnlaugsson became the first major casualty of the Panama Papers revelations, stepping down yesterday (5 April) after leaked files showed his wife owned an offshore firm with big claims on the country’s collapsed banks.

Background

Further Reading