This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.
You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/world/europe/7851415.stm
The article has changed 15 times. There is an RSS feed of changes available.
| Version 2 | Version 3 |
|---|---|
| Crisis claims Icelandic cabinet | Crisis claims Icelandic cabinet |
| (30 minutes later) | |
| Iceland's coalition government has collapsed as a result of an escalating economic crisis. | Iceland's coalition government has collapsed as a result of an escalating economic crisis. |
| Prime Minister Geir Haarde announced the resignation of his cabinet, after talks with coalition partners failed. | |
| Iceland's financial system collapsed in October under the weight of debt built up during years of rapid growth. | Iceland's financial system collapsed in October under the weight of debt built up during years of rapid growth. |
| The currency has since plummeted and unemployment soared. The cabinet had faced daily protests with demonstrators accusing it of ruining the country. | |
| The economy is forecast to shrink by 9.6% this year. | |
| Mr Haarde told reporters on Monday: "I really regret that we could not continue with this coalition. I believe that that would have been the best result." | Mr Haarde told reporters on Monday: "I really regret that we could not continue with this coalition. I believe that that would have been the best result." |
| EU links | |
| The coalition between Mr Haarde's Independence Party and Foreign Minister Ingibjorg Gisladottir's Social Democratic Alliance had been under strain for the past three months. | The coalition between Mr Haarde's Independence Party and Foreign Minister Ingibjorg Gisladottir's Social Democratic Alliance had been under strain for the past three months. |
| The prime minister said he would speak to Iceland's president to dissolve the government formally. | |
| Last week Mr Haarde called an early general election for 9 May, adding that he would not stand for health reasons. | Last week Mr Haarde called an early general election for 9 May, adding that he would not stand for health reasons. |
| The Social Democratic Alliance is now expected to look for new partners to form a government until the election. | |
| The Social Democrats have urged Mr Haarde to fire the central bank governor and move towards closer ties with Europe. | |
| Iceland, a country of about 300,000 people, has traditionally sought to stay outside the EU. | |
| But last month European Union Enlargement Commissioner Olli Rehn said the island might apply for membership as soon as this year. |