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'Icelandic government resigns immediately'

Icelandic Prime Minister Geir Haarde announced the immediate resignation of his government in the wake of the country's dire economic crisis.

world Updated: Jan 26, 2009 19:17 IST

Icelandic Prime Minister Geir Haarde announced on Monday the immediate resignation of his government in the wake of the country's dire economic crisis.

"I'm here to announce that I and the leader of the Social Democrats have decided that we will not continue with the coalition," Haarde told reporters.

The announcement came just days after Haarde announced early elections on May 9 in which he would not run due to health reasons.

A new election date was set after months of public protests calling for the government's resignation over its handling of the economic crisis.

The government coalition, made up of Haarde's Independence Party and the Social Democrats since May 2007, had been in talks since the weekend with the Social Democrats demanding that it take over the post of prime minister.