Icesave Deal Reached: Brits Happy, Icelanders Not So Much - The Reykjavik Grapevine

Icesave Deal Reached: Brits Happy, Icelanders Not So Much

Published June 8, 2009

The Icelandic government has struck a deal with the British and Dutch over the collapse of Icesave which has prompted strong reactions here at home.
The deal itself is essentially that the Icelandic government will pay back the money. To be exact, the British government will be repaid 2.3 billion pounds over the next 15 years with an interest rate of 5.5%. The agreement effectively makes the money a loan to Iceland. A UK treasury spokesman said of the news to the AFP, “The government welcomes Iceland’s commitment to recognise its obligations under the EC Deposit Guarantee Scheme to repay depositors in Icesave.”
Here at home, the reaction is not quite as positive.
Political scientist Eiríkur Bergmann Einarsson remarked that the British have achieved “total victory” in the matter, saying that the Icelandic government has pretty much let Icelandic taxpayers pay back money they never took. Stefán Már Stefánsson, a professor of law at the University of Iceland, agrees, saying that it’s unfair that the Icelandic government would strike this arrangement before a decision had been reached on a judicial level with regards to who actually was responsible for swindling people out of their money. Bjarni Benediktsson, chairman of the Independence Party, told parliament, “I am in no way satisfied with this deal although I understand the government is under ever increasing pressure,” adding that it’s still unclear how much the average Icelandic taxpayer will have to fork over. There is even divisiveness within the Leftist-Green Party, even though Minister of Finance Steingrímur J. Sigfússon is its chariman, as some MPs have expressed dissatisfaction with the deal.
A protest in front of parliament will in all likelihood take place when the deal is formally taken up in parliament at 15:00 today.

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