The first government collapse of the global economic crisis is about to yield the world's first openly-gay leader. Johanna Sigurdardottir, a former air hostess, is expected to be sworn in as Iceland's Prime Minister by the end of the week.

Her moment in the international spotlight comes at the most horrendous moment in her nation's recent history. As the global meltdown began, the collapse of Iceland's grossly over-leveraged economy was followed smartly by the implosion of its banks and currency. Now its government has gone the same way, the first to succumb to the backwash from the crisis.

Ms Sigurdardottir's party, the Social Democrat Alliance, was asked to form a new government but its leader is taking a leave of absence to recover from treatment for a benign tumour. And so, "Saint Johanna", as she has come to be known, has been propelled from the social affairs ministry – which she has presided over for a decade – to take centre stage in a choice hailed as "unexpected but brilliant".

The 66-year-old politician lives with her partner, Jonina Leosdottir, a journalist and playwright. The couple were joined in a civil ceremony in 2002. Don't expect them to show up togetherfor photocalls, however – that's not the Icelandic way. Though she is famous across the island, having been a top politician for years, her lesbian union was no big deal in this calmly progressive nation of only 300,000 people.

"Johanna is a very private person," said an Icelandic government source. "A lot of people didn't even know she was gay. When they learn about it people tend to shrug and say, 'Oh'. That's not to say they are not interested; they are interested in who she's living with – but no more so than if she was a man living with a woman."

Ms Sigurdardottir has two grown-up sons. She entered politics via the labour movement, was first elected to parliament in 1978 and was given her first ministerial office in 1987. She will be Prime Minister of a minority caretaker government composed of her Social Democratic Alliance and the Left-Greens, with outside support. It is only expected to hold office for two or three months, until fresh elections are called.

"In opinion polls Johanna has repeatedly been chosen as the most popular politician in Iceland," said the government source. "She is a good choice, because one of the problems the government is facing is lack of trust. Getting Johanna to become Prime Minister was a way of saying trust is an issue. Politicians want a fresh mandate from the electorate and, before they get it, they need to rebuild trust. Choosing Johanna is a way of saying, 'Let's bridge this gap, let's have peace to be able to implement the emergency measures'."

Geir Haarde, the former prime minister, endured months of angry protests over his poor handling of the economy; demonstrators pelted his car with eggs and police were forced to use tear gas on the streets for the first time in 50 years. Compare that to a poll in November that gave Ms Sigurdardottir a 73 per cent approval rating, she was the only minister to improve on the previous year's score.

"She is often described as the only politician who really cares about the little guy," wrote Icelandic journalist Iris Erlingsdottir in a blog this week.

She did stand for the leadership of her party back in 1994 and lost badly, but in her concession speech she predicted "my time will come". And some 15 years later, it truly has.

Pink power: Four pioneering gay politicians

Harvey Milk

First gay man elected to US office when he was voted on to the San Francisco Board of Supervisors in 1977. Was assassinated in 1978 and is the subject of a new film.

Bertrand Delanoë

The Mayor of Paris is perhaps one of the most influential gay politicians in the world. He is said to harbour ambitions of running for the French presidency in 2012.

Penny Wong

Holds the crucial Australian cabinet post of Minister for Climate Change and Water. No other openly gay politician in the country has risen so far up the ladder.

Angela Eagle

Britain's first openly lesbian MP has been a Treasury minister since 2007. She followed a trail blazed by former minister Chris Smith, who came out in 1984.

Source: Independent

Belfast Telegraph