Triumph over the abyss

The left will lead Iceland out of the crisis

In Iceland, forced to urgently get out of the economic abyss, the global crisis has completely changed the political landscape. In the early parliamentary elections last Saturday, a center-left coalition consisting of the Social Democratic Alliance (SDA) and the Left Green Movement (MLM) won. Based on the results of counting the votes of 228 thousand voters, the coalition, which has been serving as a transitional government for the last three months, for the first time received a majority of seats in the Althing (parliament) - 34 out of 63, including the SDA - 20, and the Greens - 14. Conservative The Independence Party (IP), which has been in power for the past 18 years, won only 16 seats, the lowest result in its history.

“We lost this time, but we will win later,” said PN leader Bjarni Benediktsson, admitting defeat. The right's chances of returning to power are negligible. After all, it is with their rule that Icelanders associate the financial catastrophe in the country. In October, the accounts payable of the population and foreign depositors led to the collapse of the banking system and a sharp devaluation of the national currency, the crown. The three largest banks - Kaupting, Landsbank and Glitnir - were hastily nationalized.

The authorities tried to rely on borrowed funds, the total volume of which amounted to almost $10 billion. In November, an emergency loan of $2.1 billion was issued to Iceland by the IMF, and another $2.5 billion was provided by Finland, Sweden, Norway and Denmark. About 5 billion, according to unofficial data, Germany, Great Britain and Holland agreed to allocate to Iceland. Negotiations about financial assistance were also started with Russia. However, these measures did not prevent a social explosion - in January, rising unemployment and inflation brought people to the streets, protests provoked the resignation of the coalition cabinet of Geir Horde. The political crisis ended with early elections on April 25.

The Icelandic left calls its victory “historic.” “Our hour has come,” said yesterday the leader of the SDA, 66-year-old Johana Sigurdardottir (pictured) , a former flight attendant who found herself in politics through her participation in the trade union movement and does not hide her non-traditional sexual orientation. In Jorde's cabinet, she served as Minister of Social Affairs, and since the end of January she has served as interim prime minister. Now she will form a cabinet of the left majority.

It will be difficult for the new authorities. Unemployment in the country soared to 9% from the usual 1-3%, inflation exceeded 15%, the budget deficit stood at 13.5%, and GDP is predicted to fall by 10% this year. One of the ways to save the economy, as the SDA believes, is accelerated accession to the European Union. Iceland was in no hurry to join the EU because Brussels imposes strict quotas on the fishing industry, the main item in the Icelandic budget. Now priority is given to joining the euro zone, for which the Social Democrats are ready to amend the constitution and hold a referendum. But first, Ms. Sigurðardóttir will have to find a compromise with her coalition partners, the Greens, who continue to oppose the country's entry into the EU.

Boris YUNANOV