Left seen winning election in crisis-stricken Iceland
In Sunday's elections, voters are expected to punish the party seen as responsible for their economic disarray and to vote in a pro-EU left wing party.Reykjavik -- Iceland holds snap elections Saturday, six months after its economic meltdown, with voters set to snub the party seen as responsible for the crisis and its pro-EU rivals tipped to come out on top.
Recent polls have shown that the conservative Independence Party -- which ruled the North Atlantic island from 1991 until earlier this year -- being soundly beaten by a left-wing coalition which has been in power since February.
"Everything is pointing to a disaster for the Independence Party," political scientist Gunnar Helgi Kristinsson told AFP. "They have been blamed for the crisis."
While Icelanders had enjoyed a standard of living envied by the rest of Europe, its heavy reliance on the financial sector meant that the global crisis which erupted in September last year had a devastating impact.
As the local currency, the Icelandic krona, plunged, the state had to take control of three major banks.
Unemployment, which was virtually inexistent before the crisis, is expected to hit 10 percent by the end of this year, the central bank says.
Household consumption has nosedived, and is expected to shrink by 24.1 percent in 2009, according to finance ministry forecasts.
Months of massive public protests over the crisis forced the Independence Party and its junior coalition partner, the Social Democrats, out of power in January.
Since early February, Iceland has been run by an interim left-wing coalition made up of the Social Democrats and the Left Green Movement with the Social Democrats' Johanna Sigurdardottir taking over as prime minister.
According to a poll published Wednesday in daily Morgunbladid, the Social Democrats are seen garnering 31.7 percent of votes, while the Left Greens would win 25.7 percent -- giving the two parties a majority in parliament.
The Independence Party was meanwhile credited with just 22.5 percent, far below its record low of 27 percent from 1987.
The economic crisis has stirred up debate about whether Iceland should join the European Union, with proponents arguing that membership would shelter the island nation of 320,000 people from the global turbulence.
The Social Democrats are in favour of joining the bloc, but the Left Greens are opposed because they want to protect Iceland's fisheries industry from Brussels' interventions.
The Social Democrats have made clear that they want to continue with the left-wing coalition but say that the EU question will have to be thrashed out at a later stage.
"If we win we would like to continue this coalition with the Left Greens," the deputy head of the Social Democrats, Arni Pall Arnason, told AFP.
Asked about their differing views on the EU, he replied: "This is an issue that should be resolved," noting that it would be done through a constructive dialogue.
"EU membership is needed, this is a chance that will not come again," he added.
Independence Party leader Bjarni Benediktsson, elected less than a month ago, told AFP the latest polling numbers were "disappointing."
"Obviously since the financial crisis we have lost electors. We are trying to rebuild confidence and support for our policy," he said.
"It's more of a long-term task than a short one. We are going to work up until the very last minute," he added.
Gunnar Haraldsson, the head of Iceland's Institute of Economic Studies, said Benediktsson's task was a difficult one, "psychologically", since his party has long been the country's political heavyweight.
"I think you almost need a miracle to prevent a catastrophe," he said.
Other issues, such as the climate, have been almost entirely absent from the election campaign, which does not seem to have sparked much interest among Icelanders.
Some 15 percent of 227,896 registered voters remained undecided just days before the vote.
The high number of undecided voters "could lead to a surprise (on election night), but we don't know in which direction," said Haraldsson, predicting a high abstention rate in contrast to 2007 when turnout was 83.6 percent.
Party leaders were to hold a televised debate on Friday evening in a bid to convince undecided voters.