"If everything goes as planned now a new government will take over [this] afternoon," said Steingrimur Sigfusson, who heads the Left-Green Movement.
On January 27, it was announced that the nation's coalition government had collapsed and dissolved following a banking financial crisis. In October of 2008, Iceland's banking sector collapsed and was largely nationalised. Iceland's interest rate is now 18%, with GDP expected to fall 9.6% this year. Inflation has reached 13.1%. Just before the announcement of the government taking office, nearly 1,500 people were protesting outside the parliament building over the collapsed government and the recent financial crisis, but protesters seemed happy about the change.
"The demands of the people have been met. Therefore today is a celebration," said protest organizer, Hordur Torfason to the crowd who were cheering about hearing the news.
The new minority coalition will consist of J贸hanna's Social Democratic Alliance and the Left-Green Movement with backing from the Progressive Party. J贸hanna will be replacing the current prime minister, Geir Haarde who resigned on January 26, and is the chairmen of the nation's independent party and a critic of J贸hanna. He criticizes her not for her sexual orientation, but her appointment because he believes she will not help the economic crisis, resulting in more government spending.
The quick appointment of the new government also means an early election, which is scheduled to take place on April 25.
EU Offer To Iceland
The European Commissioner for enlargement, Olli Rehn, said that if the country, stricken by the world financial meltdown, applied for membership to the 52-year-old international economic and social organization this year, it would be welcomed with open arms. The EU is expecting an application if the Social Democratic Alliance wins May's general election in the country.
The next entrant to the union is to be Croatia. It has been rapidly making changes to its government and economy in order to join in 2011. The EU will then have 28 members. Iceland could join at the same time, making 29.
Iceland could join quickly because it is already a member of the European Economic Area and therefore already complies with many EU directives. The main contention would be Iceland's rich fishing waters, which are contested by several nearby fishing countries. Iceland and the United Kingdom fought short naval wars in the 1950s and 1970s over the issue of fishing rights in the area. There is also an issue with Ireland's failure to ratify the Treaty of Lisbon, which was designed to streamline the union as more countries join. Without the unanimous ratification, further expansion is difficult.
The EU has its roots in the six member European Coal and Steel Community, founded by France and then-West Germany in 1951. In 1957, the members of the Community formed the European Economic Community (EEC), a common market and customs union. The coal and steel organization was merged into the EEC in 1967. In 1993, the EEC became the European Union. The EU adopted a central banking system and single currency, the Euro, between 1999 and 2002.
The Former Yugoslav Republic of Macedonia, Bosnia and Herzegovina and Turkey are all on the waiting list for entry to the EU.
By WIKINEWS
* "Fast track to EU could be on the cards for Iceland". The Scotsman, January 31, 2009
* David Charter "Iceland could join European Union by 2011". The Times, January 30, 2009
* Jamie Smyth "Any application by Iceland to join EU could be fast-tracked, says Rehn". The Irish Times, January 31, 2009
Posted February 1st, 2009 by Armen Hareyan
