Iceland’s election. Cod’s own country

Date: 17/05/03

Iceland's record-breaking prime minister looks likely to hang on

AFTER narrowly winning Iceland's general election on May 10th, David Oddsson, already Europe's longest-serving prime minister after 12 years in the job, may yet beat the record held by Helmut Kohl, Germany's chancellor for 16 years until 1998, as western Europe's longest-serving head of government since 1945. What is the secret of his success?

The main reason is Iceland's remarkable economy. Until last year it had grown by an average of 4.5% a year for five years - nearly twice the European Union average. Plonked in the Atlantic with no resources but fish, geothermal power and its population of 288,000, Iceland has nonetheless managed to make itself the sixth richest country per capita in the world, measured in purchasing-power terms. Though its economy marked time last year, it looks set to expand again this year. Unemployment peaked at just over 3%.

Fish still account for more than half of exports. The government has handled its marine resources cannily, avoiding the worst excesses of overfishing. In the past decade it has also encouraged diversification. Tourism has grown fast. So has the metals industry, with investors attracted by the country's huge untapped reserves of hydroelectric and geothermal power. A new aluminium smelter to be built in the eastern fjords should give a further boost. Privatisation and a new entrepreneurial climate have also pepped things up. Icelandic business has expanded abroad, acquiring - among other things - a big Russian brewery, a Swedish bank, stakes in some of Britain's big high-street retailers, and a minor British football club.

Iceland has managed its human resources well too. Some 8,000 young Icelanders study abroad every year, with America the most popular destination; amazingly, given the bleak climate and long dark winters, some 90% return, This helps keep the country dynamic and open to new ideas. Icelanders are among the world's most active internet users, and publish more books per head than in any other country.

Mr Oddsson, 55, a former actor, journalist and comic playwright, is not without critics - and his conservative Independence Party, now with 22 of parliament's 63 seats, lost electoral ground, dropping from 41% to 34% of votes cast. He must cut another coalition deal with the economically liberal Progressives, who held on to their 12 seats. The left-leaning Social Democratic Alliance, led by Ingibjorg Solrun Gisladottir, bidding to be Iceland's first female prime minister, went up to 31% and 20 seats - and could yet oust Mr Oddsson's lot by going in with the Progressives. Quite a few Icelanders think the spoils of wealth, be they fishing quotas or social benefits, are not being evenly enough spread.

Mr Oddsson, who can be abrasive and sharp-tongued, also faces challenges on the foreign front. He and most Icelanders remain firmly against joining the EU so long as they can enjoy economic ties to the continent as members of the European Economic Area, which gives them most of the EU's trade privileges (except for fish and food) without letting them have a say in decisions. The country has also been a keen member of NATO, though it has no armed forces of its own; but some Icelanders fear that the Americans will scale down their base outside Reykjavik, while others want them to leave.

Even if he keeps his job, will Mr Oddsson break Mr Kohl's record? Some say he will return to his writing before finishing a full term. After all, Iceland has more statues to poets than to politicians.