On Saturday, Iceland’s president introduced a new government led by Social Democratic Prime Minister Kristrún Frostadóttir, which aims to reduce inflation and interest rates, as well as hold a referendum on EU membership by 2027.
Frostadóttir’s center-left Social Democratic Alliance emerged as the largest party in the snap election held on Nov. 30 and has formed a coalition government with the centrist People’s Party and the left-leaning, pro-European Reform Party.
Thorgerður Katrín Gunnarsdóttir, leader of the Reform Party, has been appointed as minister of foreign affairs. This will mark the first time in Iceland that all leaders of governing parties are women, as well as the first time the country has both a female prime minister and a female president – Halla Tómasdóttir – simultaneously.
Frostadóttir, at 36, will be the youngest prime minister in Iceland’s history. The new coalition replaces the government led by Bjarni Benediktsson’s conservative Independence Party, which came second in the election, held after coalition disagreements and public dissatisfaction over migration, energy, and housing issues.
The new government plans to focus on lowering inflation and interest rates and intends to reduce the number of ministries by one to cut administrative costs.
Additionally, it aims to propose a parliamentary resolution to hold an EU membership referendum, with the goal of holding it no later than 2027.
The government will also establish a panel of independent experts to evaluate the pros and cons of retaining the Icelandic crown versus adopting the Euro currency.
