Iceland votes with EU talks hanging in the balance

Icelanders voted Saturday in a general election likely to mark the end of the nation's accession talks with the EU, following a campaign focused on voter discontent with the leftist government's austerity measures.

The right-wing Independence Party and the centrist-agrarian Progressive Party, who both want to end the northern Atlantic nation's EU accession talks, are expected to form a new coalition.

The biggest party traditionally picks the prime minister but polls in the final weeks of campaigning have put the two parties neck-and-neck.

What's clear is that the country will have a new leader after the vote, with social democratic Prime Minister Johanna Sigurdardottir, 70, having announced her retirement.

She leaves behind her a country that's economically healthier than it was four years ago, but an electorate struggling to cope with a combination of government austerity measures and a high level of household debt.

The two men battling to succeed her are the Independent Party's Bjarni Benediktsson, 43, and his counterpart Sigmundur David Gunnlaugsson, 38, of the Progressives.

Benediktsson was expected to cast his ballot in Reykjavik, while Gunlaugsson will be in the sparsely populated eastern part of the country, reflecting his party's more rural profile.

Skies were overcast in Iceland's capital when polls opened, and temperatures of four degrees Celsius slightly higher than they have been over the past week.

Campaigning has been muted, with none of the rallies, baby-kissing or even posters often seen in elections.

Politicians have preferred wooing voters through word of mouth instead, sticking to an Icelandic tradition of meeting constituents in the workplace.

Another major platform this year has been Facebook, reflecting Iceland's high level of Internet penetration.

Extravagant campaign rallies and glossy advertisements have become even less effective in the wake of the past decade's financial excess, with some voters seeing it as a sign of profligacy and political corruption.

Voter discontent has spawned an unprecedented number of political parties with no less than 15 vying for the 63 seats in the Althing, or parliament which is elected by proportional representation.

One of them, the online file-sharing activist movement Pirate Party, could be the first of its kind elected to a national parliament.

The party has pledged to spend literally nothing on its campaign, but claims to be the third biggest party on Facebook by number of "likes" received.

A Gallup poll conducted between April 18 and 25 suggested the Independence Party would win 27.9 percent of votes while the Progressives would garner 24.7 percent.

Sigurdardottir's leftist coalition was swept to power in 2009 amid a wave of angry protests.

Icelanders blamed the then centre-right coalition government for allowing the country's financial sector to balloon out of control, causing the three main banks to collapse and pushing the nation to the brink of bankruptcy.

Polls opened at 9:00 am (0900 GMT) on Saturday and will close at 22:00, when the first estimates of the outcome are expected. The final results will be announced early Sunday morning.