New Iceland government to take over as protests continue following Panama Papers leak

Reykjavik: Iceland's new rightwing government was to take office on Thursday, under fire from the start as the opposition sought a vote of no-confidence and maintained calls for a quick election to be held.

The new prime minister is 53-year-old Sigurdur Ingi Johannsson.

He was chosen Wednesday by his centre-right Progressive Party to replace Sigmundur David Gunnlaugsson, who resigned Tuesday amid mass protests over a hidden offshore account revealed in the so-called Panama Papers leak.

Demonstrators hold posters reading "Have you no shame" during a protest gather outside the parliament in Reykjavik. AFP

Demonstrators hold posters reading "Have you no shame" during a protest gather outside the parliament in Reykjavik. AFP

The outgoing government was expected to hand over to the new administration at a cabinet meeting at 1200 GMT, public broadcaster RUV reported.

Johannsson announced late Wednesday that new legislative elections would be held in "the autumn", about six months ahead of the scheduled April 2017 vote.

But protesters have demonstrated outside parliament for three days in succession, calling for the ouster of the centre-right coalition comprising the Progressives and the junior member Independence Party, and demanding elections be held sooner.

The cabinet reshuffle "is not what the people want," said Birgitta Jonsdottir, the founder of the libertarian Pirate Party which campaigns for more transparency in politics.

The Pirate Party has surged in the polls following the crisis, credited with a whopping 43 percent of voter support.

Johannsson, who held the important fisheries and agriculture portfolio in Gunnlaugsson's government, is seen by critics as emblematic of the old guard that turned a blind eye to the reckless investments that brought down the banking sector in 2008.

The crisis plunged Iceland into a deep recession and left thousands mired in debt.

A poll at the end of March suggested that just three percent of voters had a favourable opinion of him.

After the announcement of the new government late Wednesday, the leftwing and centrist opposition parties agreed to forge ahead with their motion of no-confidence presented to parliament on Monday, even though it has no chance of being adopted because of the government's majority.

Updated Date: Apr 07, 2016 14:56 PM