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HELSINKI (Reuters) - Heads of the three co-ruling Finnish parties will meet on Monday to discuss whether to break up the centre-right coalition due to the Finns party's new leader, anti-immigrant hardliner Jussi Halla-aho.
The second-biggest party in the country's parliament on Saturday picked Halla-aho as its new leader in a move set to take the moderately nationalist party into a more radical right-wing populism.
Halla-aho, who sees Finland better off outside the European Union, was fined by Finland's Supreme Court in 2012 for comments on a blog that linked Islam to paedophilia and Somalis to theft.
A member of the European Parliament, Halla-aho has proposed sanctions against organisations that rescue refugees and immigrants from the Mediterranean, saying it encourages movement from Africa to Europe.
Prime Minister Juha Sipila from the Centre Party on Saturday said there was a risk the coalition could break up, and Finance Minister Petteri Orpo from pro-EU National Coalition Party (NCP) has also cast doubt on the government's future.
Sipila is due to meet with Orpo and Halla-aho at 0700 GMT, and parties may hold their own meetings after that.
As snap elections are very rare in the Nordic country, a break-up of the coalition would likely mean that Sipila would try to form a new coalition.
Some politicians and analysts said a break-up looked likely.
"Liberal democracy and a western conception of man must be defended now... National Coalition Party can not continue in the same government with the Finns Party," said Jan Vapaavuori, Helsinki mayor and an influential figure in the NCP, in a blog.
In case of a break-up, one possible way forward for Sipila is to replace the Finns party with two small opposition parties, the Swedish People's Party and Christian Democrats.
That would leave the new coalition with a very narrow parliament majority of 101 seats out of 200. Finland has been run by coalition governments with strong majorities for decades.
For Sipila, at stake is a major healthcare and local government reforms central to his plan to balance public finances. The coalition, half-way through its four-year tenure, has outlined the reform but has yet to agree on details.
"The government's decision-making had weakened already before this situation... The current fiscal plans will be watered down in any case," said Jan Von Gerich, analyst at Nordea.
"With the Swedish People's Party and the Christian Democrats, they could keep some of their current plans on track."
Reporting by Jussi Rosendahl and Tuomas Forsell; Editing by Michael Perry