World’s oldest parliament poised for radical Pirates to takeover

The world is preparing for the first ever Pirate-led government with Icelandic citizens heading to the ballot box this Sunday.

The Pirate Party, which did not exist four years ago, leads the way with 22.6 percent of the vote, according to an opinion poll conducted by the Social Science Research Institute of the University of Iceland.

"It's pretty amazing really," Sunna Aevarsdóttir, a Pirate Party candidate in Iceland's largest district, told CNBC in a phone interview.

"To be on the verge of being elected is … exhausting, in a good way of course," she added.

A 'perfect storm'

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The population of the small volcanic island in the North Atlantic Ocean is roughly 323,000 – similar to that of Pittsburgh in the U.S. state of Pennsylvania. The Pirates are a radical alternative to traditional political parties and, unusually, are predominantly based online. Many of its policies are gauged by polls it conducts on its website and the party's popularity with the younger generation in Iceland has soared as a result.

According to analysts, the Pirates are in contention to either win or finish a close second to the Independence Party, one of two currently governing in Iceland. Nonetheless, it looks likely that the three seats the Pirates hold in Iceland's 63 member parliament, is set to increase to around 20. A coalition of different governing parties is expected, regardless of who wins the vote outright.

Aevarsdóttir believes the party is profiting from a "perfect storm".

"You know, only 17 percent of people (in Iceland) trust our parliament. It has just been one scandal after another, at least in the past the government used to hide the fact it was blatantly corrupt."

She added, "the current government has three separate ministers indicted in the Panama Papers, it had a prime minister who still has not officially apologized or told the truth about offshore money and a finance minister whom has mishandled his taxes."

Bjarni Benediktsson, the current minister of finance and economic affairs, dismissed the allegation that he has mishandled his taxes when contacted by CNBC.

Panama Papers casualty

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The election is as a consequence of the resignation of Iceland's most recent prime minister, Sigmundur Davið Gunnlaugsson, who was famously the first high-profile casualty of the Panama Papers investigations earlier this year. His wife was revealed to have had millions of U.S. dollars stored in an offshore account.

The former prime minister's press office told CNBC back in April, "they have never sought to hide these assets from Icelandic tax authorities ... No Parliamentary rules on disclosure have been broken."

The Pirates seem to be benefiting from harbored anger stemming from the global financial crisis in 2008 which rocked the Land of Vikings almost to the point of collapse. Only thanks to an international bailout totaling around $4.6 billion was the economy able to show signs of recovery.

Citizens of Iceland took to the streets to protest, bankers were sent to prison and the electorate's trust in the political mainstream plummeted.

'No need for U-turn'

Bjarni Benediktsson, as well as being the minister of finance and economic affairs, is the chairman of the Independence Party and confidently stated to CNBC that his party will be victorious come Sunday.

"I believe we will beat them (the Pirates), they are more of a movement than a political party. But, it is true; they have shown remarkable support especially with the young voters."

Benediktsson cited one particular reason as to why his party is on track to be elected – the economy.

"We are stable. The economy in Iceland is extremely strong at the moment. We are enjoying the longest economic growth period in recent history. Unemployment is almost non-existent. Debt is falling rapidly and inflation is at 1 percent. There is no need for a U-turn."

Baldvin Bergsson, a political scientist at the University of Iceland, issued a word of warning to those making predictions as he told CNBC in a phone interview: "It is a unique election. It has never been like this before so there is no point making predictions."

"People that do will likely have to eat their hats," he added.

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