NEW Zealand kingmaker Winston Peters, whose minority party has decided to form a Coalition government with Labour, making Jacinda Ardern the country's new Prime Minister.
The NZ First leader told the media of his decision - which brings the left out of the cold of opposition for the first time in nine years - late this afternoon.
Mr Peters said he did not tell Ms Ardern, 37, what he had decided before making the announcement, meaning she would have found out she was PM via livestream.
The NZ First leader has been offered the role of Deputy PM.
Jacinda Ardern will become New Zealand's third female Prime Minister (after Jenny Shipley and Helen Clark), and, at 37, is the youngest woman to have led the Labour Party.
Mr Peters' decision, made almost four weeks after the September 23 poll, gives Ms Ardern's Labour Party the numbers to form a coalition government with Peters' New Zealand First and the Greens.
The Greens are expected to back Labour on confidence and supply, giving the combined parties 63 seats, two more than the 61 majority they need.
"We had a choice to make for a modified status quo or for change... that's why in the end we chose a coalition government of New Zealand First with the New Zealand Labour Party," Mr Peters told reporters.
The decision is a shock to the National Party and its leader Bill English, who tweeted this morning about "a possible agreement" with New Zealand First.
Mr English became Prime Minister after former Nationals leader John Key announced his resignation in December last year.
Winston Peters is a former National Party MP who formed New Zealand First in 1993.
The party has formed coalitions with both the Nationals and Labour in the past. It won nine seats in the most recent election.
Ms Ardern's ascension to the prime ministership continues a trend towards younger leaders in western democracies. Earlier this year Emmanuel Macron was elected President of France at the age of 39, and just this week, 31-year-old Sebastian Kurz emerged as Austria's next Prime Minister after national elections.
AUSTRALIAN POLITICIANS REACT
Australia's Labor leader Bill Shorten was quick to offer his congratulations on Twitter, describing Ms Ardern's elevation to leader as "a new era".
Australian PM Malcolm Turnbull has texted his congratulations, Sky News reports.
Congrats to Jacinda Ardern and the NZ Labour team. After many nail-biting days, a great result! - JG— Julia Gillard (@JuliaGillard) October 19, 2017
Ms Ardern's rise to the prime ministership could prove difficult for Australia's Foreign Minister Julie Bishop, who said she would find it "very difficlt to build trust" with a New Zealand Labour government back in August.
Ms Bishop was speaking at the height of the MP citizenship scandal, when it emerged that Deputy Prime Minister Barnaby Joyce held dual citizenship of Australia and New Zealand.
Ms Ardern said it was "highly regrettable" that Ms Bishop had chosen to make "false claims" about the New Zealand Labour Party.
"I have been utterly transparent about the situation. I stand by my statements that I knew absolutely nothing about the Barnaby Joyce case until it broke in the media yesterday afternoon," Ms Ardern wrote at the time.
Former Australian Federal MP Rob Oakeshott tweeted shortly after Winston Peters completed his lengthy speech:
After Australia's federal election in 2010, Mr Oakeshott was criticised for making a 17-minute speech that only revealed he was giving his support to Labor's Julia Gillard at its very end.
KIWI DOLLAR DROPS
The New Zealand dollar fell after Winston Peters said he would support a Labour-led government, saying the nation voted for change, and that he expected a change to the Reserve Bank Act.
The kiwi dropped as low as US70.62c and was trading at 70.65c as at 7.15pm local time (5.15pm AEDT) from 70.94c before he started his briefing.
The local currency started declining amid reports the incumbent National Party baulked at NZ First's demands for ministerial posts.
"The majority of this country has voted for the change that is happening," Mr Peters told a briefing in Wellington.
Mr Peters said his party believed an economic slowdown is "already here" and those risks fed into the decision made.
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