Erna Solberg set to become Norway's new PM after poll win

Erna SolbergNorway's centre-right leader Erna Solberg is set to form a new government after Labour Prime Minister Jens Stoltenberg on Monday admitted election defeat.

Solberg described her win as "a historic election victory for the right-wing parties".

Her Conservative Party is expected to form a government with the anti-immigration Progress Party.

Just two years ago, Prime Minister Stoltenberg was being widely praised both in and out of Norway for his strong and compassionate leadership following the terrorist attacks of 22 July 2011, when Anders Breivik killed 77 people in a bombing and shooting.

He lost despite steering the country safely through the economic crisis and overseeing a booming economy with very low unemployment. Many observers suggested that it was a case of 'voter fatigue' - after eight years of Stoltenberg's leadership, voters were itching for a change.

Despite his electoral loss on Monday, Stoltenberg kept smiling, declaring before a rapturous and grateful Labour party that ''we are not in any way beaten.''

Stoltenberg will stand down in October after delivering his government's last budget. "In accordance with Norwegian parliamentary tradition, I will seek the resignation of my government after the presentation of the national budget on 14 October, when it's clear that there is a parliamentary basis for a new government," he said.

The Solberg-led opposition says it has fresh and different plans to make sure Norway's economy stays strong even after the current oil resources that have made this one of the world's wealthiest countries starts to run out.

Solberg will now start work on negotiating a coalition with other centre-right parties.

Solberg, 52, will become Norway's second female prime minister and its first Conservative prime minister since 1990.

She told supporters in Oslo, "Today the voters have produced a historic election victory for the right-wing parties. We will give this country a new government."

Correspondents say at least the top two cabinet posts - and possibly the top three - are likely to be filled by women.