Ireland forms minority government

Following weeks of negotiations, Ireland's two largest parties agreed on the formation of a Fine-Gael-led government, Irish media have reported.

"Both Fine Gael and Fianna Fail have reached a political agreement to facilitate a Fine Gael-led minority government," Fianna Fail, Ireland's second-largest party said in a statement.

"Both party leaders are now being briefed, extensive drafting has to be done and then both Fianna Fail and Fine Gael will hold separate parliamentary party meetings to outline the details of the confidence and supply arrangement," the statement said.

The two parties will reportedly allow the passing of three annual budgets, a source told news agency Reuters. They found a "broad agreement" on a range of policies including rent supplement increases and water charges.

Ireland's parliament is due to reconvene on Wednesday to elect a prime minister. The deal means it's likely that Fine Gael head and current prime minister, Enda Kenny, will be re-elected.

Although both parties are considered center-right, their relationship is plagued by mistrust and historical friction dating back to the 1920s Irish civil war.

"The days of majority rule in absolute terms ... are gone. We are entering into a new era in Irish politics, where the views of everyone need to be taken on board," said Fianna Fail negotiator Michael McGrath.

"It is going to be a very challenging scenario for everybody involved, but we have to make it work," McGrath said.

Neither party attracted enough votes to form a government on its own after an inconclusive general election on February 26.

Fine Gael won 50 seats and Fianna Fail 44 in the 158-seat Dail, or lower house, of parliament. Anti-austerity Sinn Fein won 23 seats.

The final wording of the agreement has yet to be finalized, and talks are expected to continue on Saturday and Sunday. The agreement could potentially last for three years.

rs/gsw (AP, AFP, dpa, Reuters)