According to a new report from the Central Bank, the state of personal household debt in Iceland is actually better than it was before the economic collapse.
RÚV reports that the purpose of the assessment was to try and put together a clearer picture of the state of debt in the Icelandic economy. Eight specialists worked on examining the situation, sorting through the often uncertain economic data that has arisen since the bank collapse.
The conclusion they arrived at was that when the debts owed by companies that have gone bankrupt are compiled and measured, the amount of pure debt within the economy is actually lower than it was before the bank collapse – the debt owed by the public sector, however, is significantly higher.
There are still some grey areas, the report says. It is uncertain, for example, how much of this debt will be written off and how much will be paid back. They estimate those measurements will take a few years, and they also emphasise that Iceland’s GDP has decreased.
Nonetheless, the state of debt within Iceland is better than expected. In fact, they contend, when the debt owed by Activis – which is now under the power of German creditors – is removed from the picture, the level of debt in Iceland has not been this positive since 1987.