Iceland's coalition government has appointed a new prime minister, a day after Sigmundur David Gunnlaugsson stepped aside for an "unspecified amount of time" in the wake of the Panama Papers scandal.
The Progressive and Independence parties named the agriculture and fisheries minister, Sigurdur Ingi Johannsson, as the country's new leader during an overnight meeting. They also agreed for general elections to occur "before the end of the year".
Johannsson vowed to continue the coalition's work. "We are, of course, hoping this will help bring stability in the political system," he said.
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However, the appointment and rescheduling of the election as the answer to the political crisis gripping Reykjavik has not received universal support.
"It is unclear whether the move [will] satisfy angry Icelanders," says The Guardian.
Protesters staged a mass demonstration outside parliament for a third consecutive day yesterday, hurling eggs, yoghurt and fruit at the building, while drumming pots and pans throughout the meeting.
There are suggestions that some members of opposition parties will ignore the deal and push ahead with a vote of no confidence in the government at a time when support for the coalition is crumbling.
"Polls suggest the Progressive Party has lost much of its support and that the tiny Pirate Party, founded just over three years ago, stands to make significant gains," says Paul Adams, a BBC correspondent in Reykjavik. "Unless this government's fortunes change, it could be out of power in a few months' time."
Panama Papers: Iceland's Prime Minister 'steps aside' over offshore revelations
6 April
Mass protests in Iceland are expected to continue for a third day, as the Prime Minister countered reports he had resigned his office after being implicated in the leaked 'Panama Papers'.
It was initially reported that Sigmundur David Gunnlaugsson had agreed to step down following revelations that he and his wife, Anna Sigurlaug Palsdottir, owned a secretive offshore investment company with multi-million pound claims on the country's failed banks.
However, a press release from Gunnlaugsson's office clarified that he had not given his notice, but would be handing the reins to the vice-chairman of the Progressive Party for "an unspecified amount of time".
"The Prime Minister has not resigned and will continue to serve as chairman of the Progressive Party," the statement said.
Gunnlaugsson insisted that neither he nor his wife had committed any crime - a claim backed by The Guardian and the BBC – but members of his own party joined opposition politicians and demonstrators in calling on him to resign, adding to the nation's political turmoil.
Step forward the Pirate Party, the self-styled "Robin Hood" group of Icelandic politics which favours a relaxation of drugs regulation, legalising blasphemy and re-drafting the constitution.
Responding to the crisis, party MP Birgitta Jonsdottir said she was "ready" to form a government in the event of a snap election.
The Pirate Party has gained a significant lead in the polls and "appears to be garnering momentum as Icelanders' faith in the established parties wears thin", says The Independent.
In a poll last month, it garnered 36 per cent support, putting it on course to be Iceland's biggest party.
"We want to be the Robin Hood of governments, transferring the power from those at the top to the general public of Iceland," Jonsdottir wrote in The Independent earlier this year, adding that "people in Iceland are sick of corruption and nepotism".
Asked about the possibility of her party taking power, the politician said that "in these strange times, anything is possible". While the current situation remained "liquid", she they were ready and prepared to form a government, she added.
Founded in 2012 by a group of activists, poets and hackers, the international Pirate Party movement now has representation in a number of countries.
Icelandic President Olafur Ragnar Grimsson yesterday cut short his visit to the US to return to the country, saying he needed to consult all the nation's political parties before making a decision over whether to call a general election.
