Economics Minister Pens Article On Iceland’s Financial Recovery

Published August 21, 2012

Minister of Fisheries, Agriculture and Economic Affairs Steingrímur J. Sigfússon has written an article for the Financial Times detailing what he sees as the “well established” turnaround of Iceland’s economy.
When the former ruling coalition of the Independence Party and the Social Democrats were driven from power in 2009 – and a new coalition comprised of the Social Democrats and the Leftist-Greens were voted in – Steingrímur was tasked with being the country’s Minister of Finance. Facing a massive deficit, failing banks, and foreign debt well exceeding available revenue, the outlook was bleak at best.
However, Steingrímur writes in his article, “Icelandic lessons in coming back from the brink”, Iceland chose economic policies of recovery that he believes other European nations could learn from:

The Icelandic government has pursued the politics of social and economic inclusion. Those on higher incomes have contributed more in absolute terms through the adoption of a progressive system of taxation, while those on lower incomes have been sheltered. Welfare services were cut less than other areas of public spending. The outcome has been as intended: a more equitable net income distribution. Purchasing power among lower-income groups has been better maintained than among those with higher incomes, enabling them o continue as active participants in the economy.

Steingrímur also credits the depreciation of the krónur, splitting the banks into old and new versions, and granting depositors priority over other claims on money within the banks.
“Policy makers and legislators in Europe should seriously consider whether it is not timely and sensible to incorporate an Iceland-style priority ranking into law,” he closes in part. “Recent comments reported in the media by George Osborne, the UK chancellor, give reason to believe that there is a growing recognition of the shortcomings of current regimes and perhaps even a will to take active measures to improve it. If that is the case then just maybe Iceland’s hard-earned lessons can provide useful guidance today for leaders in Britain and the eurozone.”



News
Ticks Are Here To Stay

Ticks Are Here To Stay

by

Ticks in Iceland are likely here to stay, according to Vísir.is. Entomologist Erling Ólafsson told Vísir that all indications point

News
Direct Bus Between Keflavík And Akureyri Possible

Direct Bus Between Keflavík And Akureyri Possible

by

A tour company is looking into setting up a bus line that would take people from Keflavík International Airport directly

News
Newer, Bitier Species Of Midge Discovered

Newer, Bitier Species Of Midge Discovered

by

The tiny, rash-inducing biting fly that has plagued campers across North America has finally made its first appearance in Iceland,

News
Walking Path Around Holuhraun Opens

Walking Path Around Holuhraun Opens

by

You can now take a walk close to the Holuhraun lava field, provided you are very, very careful. RÚV reports

News
Blasphemy Now Legal In Iceland

Blasphemy Now Legal In Iceland

by

At long last, a bill that did away with Iceland’s blasphemy laws has been passed by parliament. RÚV reports that

News
Five Best News Stories of 2015

Five Best News Stories of 2015

by

Hard to believe that 2015 is already half over, but it is. Maybe it seems like only yesterday since the

Show Me More!