Panama Papers: Ruling Coalition On Shaky Ground

The future of the ruling coalition is uncertain in the wake of the unfolding Panama Papers scandal.

As the Panama Papers leak continues to unfold – implicating numerous world leaders, including Prime Minister Sigmundur Davíð Gunnlaugsson – the future of the Progressive Party’s ruling coalition with the Independence Party is unstable.

Finance Minister and Independence Party chairperson Bjarni Benediktsson told Kjarninn that it is uncertain if the coalition can continue.

“We take this situation very seriously, and we realise the government is facing a lot of adversity,” he said. “We intend to examine the situation and determine whether the government can gather the support needed to keep going. That’s not so obvious right now.”

There have been voices within both parties calling for the Prime Minister to resign – something he has said he will not do. Members of the Progressive Party in Akureyri and the Young Conservatives have both called for his resignation or an end to the coalition.

Vísir reports that President Ólafur Ragnar Grímsson is back in Iceland now, telling reporters that the current situation is “very serious”, and will be talking to coalition party leadership to discuss the matter.

The involvement of the President is very telling. As readers may recall, in 2009, the ruling coalition of the Independence Party and the Social Democrats also faced massive protests, and fell apart when the Independence Party would not switch the coalition leadership position with the Social Democrats. This prompted the President to step in, in his role as the head of state, to form an emergency coalition comprised of the Social Democrats, the Left-Greens and the Progressive Party. Early elections followed shortly thereafter.

Yesterday’s protests made international headlines, and possibly broke records for attendance. An estimated 22,000 people turned up yesterday to demand the Prime Minister’s resignation. More protests are scheduled to take place today.

Related:

Finance Minister Tight-Lipped On Coalition’s Future

Reykjavík City Council Members Also Implicated In Panama Papers

Opposition Will Also Call For Dissolution, Early Elections