News
Coalition talks continue - results expected over the weekend
The two coalition parties, the Social Democrats and the Left Green Movement, have continued their talks through the week and are expected to conclude them over the weekend, according to the two party leaders, Prime Minister Johanna Sigurdardottir and Finance Minister Steingrimur J. Sigfusson.
So far the leaders have been unwilling to reveal the results of the talks, other than confirming that the current government intends to continue. The two parties gained a clear majority of mandates in the Parliament in the April 25 elections.
The parties are said to be close to an agreement on the issue of an EU membership application but on the matter they stand divided. The new government will face enormous problems when it takes office. First and foremost it has to deal with serious issues of extensive budget consolidation since the budget is now run at a high deficit. According to the IMF Stand-by Arrangement which the Icelandic authorities entered into late last year the budget deficit has to be bridged before the end of 2012.