Iceland Votes For New Parliament Amid Disagreements On Immigration, Energy Policy, Economy

Reykjavik (Iceland): Icelanders are electing a new parliament Saturday after disagreements over immigration, energy policy and the economy forced Prime Minister Bjarni Benediktsson to pull the plug on his coalition government and call an early election. This is Iceland's sixth general election since the 2008 financial crisis devastated the economy of the North Atlantic island nation and ushered in a new era of political instability.

Opinion polls suggest the country may be in for another upheaval, with support for the three governing parties plunging. Benediktsson, who was named prime minister in April following the resignation of his predecessor, struggled to hold together the unlikely coalition of his conservative Independence Party with the centrist Progressive Party and the Left-Green Movement.

Iceland, a nation of about 400,000 people, is proud of its democratic traditions, describing itself as arguably the world's oldest parliamentary democracy. The island's parliament, the Althingi, was founded in 930 by the Norsemen who settled the country. Fierce weather in the sub-Arctic nation threatened to hamper some voters getting to polling stations on Saturday, with heavy snow blocking roads in many areas. The weather could also delay the delivery of ballot boxes to counting centres after polls close at 10 pm (2200GMT).

Here's what to look for in the contest.

How does the election work?

Voters will choose 63 members of the Althingi in an election that will allocate seats both by regional constituencies and proportional representation. Parties need at least 5% of the vote to win seats in parliament. Eight parties were represented in the outgoing parliament, and 10 parties are contesting this election.

Turnout is traditionally high by international standards, with 80% of registered voters casting ballots in the 2021 parliamentary election.

Why now?

A windswept island near the Arctic Circle, Iceland normally holds elections during the warmer months of the year. But on Oct 13 Benediktsson decided his coalition couldn't last any longer, and he asked President Halla Tómasdóttir to dissolve the Althingi. “The weakness of this society is that we have no very strong party and we have no very strong leader of any party," said Vilhjálmur Bjarnason a former member of parliament. “We have no charming person with a vision... That is very difficult for us.”

Why is Iceland's politics so fractured?

The splintering of Iceland's political landscape came after the 2008 financial crisis, which prompted years of economic upheaval after the country's debt-swollen banks collapsed. The crisis led to anger and distrust of the parties that had traditionally traded power back and forth, and prompted the creation of new parties ranging from the environment focused Left-Green Alliance to the Pirate Party, which advocates direct democracy and individual freedoms.

“This is one of the consequences of the economic crash," said Eva H Önnudóttir, a professor of political science at the University of Iceland. “It's just the changed landscape. Parties, especially the old parties, have maybe kind of been hoping that we would go back to how things were before, but that's not going to happen.”

What are the issues?

Like many Western countries, Iceland has been buffeted by the rising cost of living and immigration pressures. Inflation peaked at an annual rate of 10.2% in February 2023, fuelled by the fallout from the COVID-19 pandemic and Russia's invasion of Ukraine. While inflation slowed to 5.1% in October, that is still high compared with neighbouring countries. The US inflation rate stood at 2.6% last month, while the European Union's rate was 2.3%.

Iceland is also struggling to accommodate a rising number of asylum-seekers, creating tensions within the small, traditionally homogenous country. The number of immigrants seeking protection in Iceland jumped to more than 4,000 in each of the past three years, compared with a previous average of less than 1,000.

What about the volcano?

Repeated eruptions of a volcano in the southwestern part of the country have displaced thousands of people and strained public finances. One year after the first eruption forced the evacuation of the town of Grindavik, many residents still don't have secure housing, leading to complaints that the government has been slow to respond.

But it also added to a shortage of affordable housing exacerbated by Iceland's tourism boom. Young people are struggling to get a foot on the housing ladder at a time when short-term vacation rentals have reduced the housing stock available for locals, Önnudóttir said.