Iceland leans toward leftist government in latest vote count

Icelanders, angry over a string of political scandals, ousted the centre-right government in an election that could pave the way for a young charismatic opposition leader to form a left-leaning coalition, vote counts indicated on Sunday.

With the defeat of incumbent Prime Minister Bjarni Benediktsson’s coalition government likely, his main opponent, The Left-Green Movement’s Katrin Jakobsdottir, could get a chance to form a narrow majority in parliament.

The Nordic island of 340,000 people, one of the countries hit hardest by the 2008 financial crisis, has staged a remarkable economic rebound spurred by a tourism boom.

Benediktsson called the snap election in September, after less than a year in government as a scandal involving his father prompted the Bright Future party to drop out of his ruling coalition, citing a breach of trust.

The previous government was defeated last year in the wake of revelations in the Panama Papers about then Prime Minister Sigmundur David Gunnlaugsson’s use of offshore tax havens.

In addition to the political scandals, a growing sense of inequality and unease about immigration in one of the world’s most ethnically homogeneous nations have rattled a democracy known for its political and social stability.

With some 70 percent of votes counted, Jakobsdottir, 41, of the Left-Greens stood to gain a narrow majority with three other opposition parties in government.

The latest results show a Left-Green coalition with just 32 seats in the 63-member parliament. If the final count falls below the minimum 32 seats Jakobsdottir’s bloc needs to secure victory, Icelanders may be in for months of coalition talks before a new government is formed.

The parliament is likely to be split between eight parties with the prospect of two new parties and one of the parties in the current tri-party government failing to secure enough votes to remain in parliament.

Independence Party, the main partner in the current government coalition, stood to lose 4 percentage points from last year’s election to land 25 percent of the vote.

The Left-Greens came in second with 17 percent, up 1 percentage point from last year’s election, and its probable ally the Social Democrats in third with 12 percent, almost doubling its share.

Jakobsdottir said on Sunday she would not rule out working with the new Centre Party, which was formed this September by former Prime Minister Gunnlaugsson, if she failed to form a left-leaning coalition government.

“Nothing is out of the picture, but our first choice is to work with the parties on the left,” she told Reuters in a telephone interview.

Gunnlaugsson, who was ousted last year, and his Centre Party stood to get 11 percent of the vote.

The Independence Party has dominated Iceland’s politics for decades. It wants to reduce the national debt and cut taxes on individuals and businesses. The party won 21 seats in elections a year ago.

The Left-Greens want to reduce inequality and fund an increase in public health care, education and infrastructure spending by hiking taxes for the wealthy and introducing a property tax.

The party came second in last year’s election with 10 seats but failed to form a ruling coalition.

The Pirate Party, which last year rode on a wave of anger against the establishment to become the third biggest party in parliament, stood to get 9 percent of votes in Saturday’s election down from 14 percent last year.