Norway’s left-wing opposition wins in a landslide, coalition talks next

Norway’s centre-left opposition parties are on course to win a majority in parliament after Monday’s election and will now negotiate how to form a coalition, with climate change and a widening wealth gap expected to be central to discussions.

Conservative Prime Minister Erna Solberg conceded the election and will step down after eight years in power, while Labour Party leader Jonas Gahr Stoere said he intends to form the next government.

Norway’s status as a major oil and gas producer has been at the heart of the campaign, although a transition away from petroleum – and the jobs it creates – is likely to be a gradual one despite progress by pro-environment parties.

To form a viable Cabinet, Stoere must persuade potential centre-left partners to compromise on policies ranging from oil and private ownership to Norway’s relations with the European Union.

“We, as the biggest party, will make sure that Norway will get a new government and a new course,” Stoere said in a speech to party members.

“In the coming days, I will invite the leaders of all parties who want a change,” he said, adding he would start with the Centre Party and Socialist Left.

Norway’s crown currency was largely unchanged, trading at 10.20 against the euro.

“There will be some tax increases for example and there will be a different set of priorities … but the total size of the public budget will not be substantially different from if the current government would remain in place,” said DNB Markets Chief Economist Kjersti Haugland.

With 97.5% of the votes counted, Labour and four other centre-left parties could swing to a combined majority of 100 seats, up from 81 currently, the Directorate of Elections projected.

A minimum of 85 seats is required to win a majority in the 169-seat parliament.

If the projections prove correct, Stoere could form a majority consisting of Labour, the Centre Party and the Socialist Left, which are on track for a combined 89 seats, and avoid having to work with the Marxist Red Party or the anti-oil Greens.

Getting the rural-based Centre Party and the mostly urban Socialists to govern together could be difficult, however, as the two take different views on issues from oil to taxes.

Ruling in a minority could also be an option for Labour. Stoere says his government would focus on cutting CO2 emissions in line with the 2015 Paris Agreement, but has rejected any ultimatum over energy policy.

Stoere has pledged to address inequality by cutting taxes for low- and middle-income families and hiking rates for the rich.

Reporting by Nora Buli and Victoria Klesty; Writing by Terje Solsvik and Gwladys Fouche; Editing by Grant McCool and Peter Cooney