The Social Democratic Alliance and the Left-Green Party in coalition created Iceland's first left wing majority government in its history - nevertheless 1% still own 20% of all wealth in Iceland

Regarding Iceland's membership in the European Union, ultimately, the parties agreed to submit a parliamentary resolution on EU membership this spring.
The nation will then vote on EU membership with one referendum so Icelanders will have the right to exercise their democratic vote on this issue

In addition this first liberal parliament will try -- over the next 100 days -- to come up with a new budget, negotiate a settlement with Great Britain regarding English savings accounts with Icelandic banks, overhaul Iceland's Central Bank, create a new labour policy, and reevaluate the Iceland's controversial fishing quota system.

From the Huffington Post -
"Economist Jon Danielsson of the London School of Economics has speculated that the cause of Iceland's total collapse was the recklessness of the so-called New Viking raiders and the complete lack of meaningful governmental regulation.

Perhaps the new government has decided that prudence is the proper remedy to such brashness."

Some, like Economist Professor Hudson, however recommend that Iceland reneague and NOT repay its banks' obligations, but instead use all available revenue to rebuild the nation's wealth.


Iceland's central bank slashed its key interest rate by 2.5 percentage points to 13 percent earlier this month -- its third cut within two months -- and it forecast a further 'significant' cut in June as the crisis-hit island nation's economy stabilised

However the IMF, which has led a multi-billion dollar rescue package for the country, also emphasised the need to take a slow approach to any easing of capital controls.

Their permanent representative in Iceland, Franek Rozwadowski, said

'If interest rates are reduced too much or too fast, it could put unfavourable pressure on the Icelandic crown, leading to its further devaluation,'