Iceland

On March 6th Icelanders go to the polls to vote in an historic referendum, The Economist reported in a commentary introducing a reader debate. They must decide whether to accept or reject a deal made by their government to repay to the British and Dutch authorities €3.9 billion ($5.3 billion) lost by British and Dutch savers in Landsbanki, a failed Icelandic bank. Arguments on both sides have been fierce.

The president of Iceland, which became one of the biggest victims of the financial crisis when its banking system collapsed, predicted an economic recovery earlier than expected, The Wall Street Journal reported. "In the second half of this year and 2011, the recovery will be gaining strength," Ólafur Ragnar Grímsson said in an interview at the World Economic Forum's annual meeting here. Mr. Grímsson said a decline in the country's currency, the krona, is helping to revive its export industries such as fishing, manufacturing and aluminum.

Iceland set March 6 as the date for a referendum on passing a law seen key to restoring its financial health after the Dutch government squashed hopes of a new deal to repay the island's creditors, Reuters reported. Iceland owes Britain and the Netherlands more than $5 billion for losses related to the collapse of the North Atlantic island's banks in late 2008. But earlier this month, its president refused to sign a law setting out repayment terms, forcing a referendum on the issue and putting on hold continued international aid for Iceland's stricken economy.

he Dutch Finance Ministry is not involved in renegotiation talks with the government of Iceland over its debts related to the collapse of online bank Icesave, a spokeswoman for the ministry said on Tuesday, Reuters reported. Iceland plans to hold a referendum in the next two months on terms for paying back Britain and the Netherlands more than $5 billion for money lost in high-interest Icesave bank accounts during a financial meltdown in 2008. The two countries compensated savers in full and want their money back.

There are many ways to decide whether to repay your debts but a national referendum is surely a first. That is what is going to happen in Iceland after its president refused to sign a bill paying €3.8 billion ($5.5 billion) to the British and Dutch governments over 15 years, The Economist reported in an analysis. Given that a quarter of the Icelandic population has signed a petition opposing such payments, it is not difficult to imagine how such a poll will turn out. “Vote for lower incomes” is not going to be a very popular slogan. And the Icelanders will only be the first.

Iceland's efforts to join the European Union could be delayed by a referendum on terms for repaying Britain and the Netherlands following a banking collapse, the Spanish EU presidency said on Friday, Reuters reported. British and Dutch depositors in high-interest "Icesave" bank accounts lost their money when Iceland's entire financial system imploded in late 2008 under a heavy weight of debt. The government plans to hold a referendum on the issue late in February or early in March.

The last time Iceland and the U.K. went to war it didn't end well for the British, The Wall Street Journal reported in an editorial. This time the squabble isn't related to fish; it's about money and a sunken savings account called Icesave, from Iceland's Landsbanki. It is a story of colossal folly. At risk is Icleand's future membership of the European Union and $5.7 billion that the British and Dutch governments say they are owed.

Iceland was warned on Tuesday that it risked international isolation after the country’s president blocked a deal to repay Britain and the Netherlands almost €4 billion ($5.7 billion, £3.6 billion) lost in a failed Icelandic bank, the Financial Times reported. The British and Dutch governments condemned the decision by president Ólafur Ragnar Grímsson and hinted at repercussions for Iceland’s bid to join the European Union and for its $10 billion international economic rescue programme.

President of Iceland Ólafur Ragnar Grímsson is still contemplating whether to veto the Icesave legislation, which the Icelandic parliament passed on December 31, Iceland Review reported. The number of signatures on the petition urging the president to veto the legislation so that it will be up for a national referendum is still growing. Last night it had reached 62,000 signatures, which represents a quarter of Icelandic voters.

Iceland’s parliament approved an amended bill on Wednesday to repay more than $5 billion lost by savers in Britain and the Netherlands when the island’s banks collapsed during the financial crisis, the Financial Times reported. The passage of the legislation, backed by a 33-30 margin by members of parliament, boosts Iceland’s hopes of swift entry to the European Union and of getting its shattered economy back on track.