So – an accord was reached late last night in the Budget Committee [which has been working on amendments to the Icesave agreement] between the reps of all political parties, except the Progressive Party, on conditions for a sovereign guarantee of the Icesave debt [in plain talk: conditions for having us commoners pony up the dosh]. The amendments make up a four-page long PDF document and at a glance the appear to cover all major issues. In brief:
- The unprecedented circumstances in which Iceland finds itself shall be taken into account
- No Icelandic state assets may be seized, including assets located abroad
- Iceland shall maintain full and unconditional control of its resources
Economic:
- Payments shall not exceed 4% of GDP to the UK and 2% of GDP to the Netherlands in the years 2017-2023
- Payments shall be 50% of the above during the first and last years of payment
- Calculations of payments, which are to be in pounds Sterling and euros, shall be in line with the median exchange rate set by the Central Bank
- If the debt payments exceed the above ratio of GDP, negotiations shall be held about the impact on the agreement
Legal:
- The Icelandic state does not abandon its right to have legally determined whether or not it is obliged to undertake such payments in the event of a systemic collapse
- If it is legally determined that no such obligation exists, the sovereign guarantee shall contain the proviso that negotiations shall take place about the impact on the loan agreement and the obligations of the state
- If such negotiations do not take place, Iceland’s parliament shall be authorized to limit the sovereign guarantee
- The Ministry of Finance, Ministry of Business Affairs and Central Bank shall regularly evaluate the situation of the Icelandic state and the Minister of Finance shall present a report to parliament annually
- Parliament can request a review of the agreement no later than 5 October 2015
- The government shall undertake all necessary means to recover the funds that were deposited into the Icesave accounts, in collaboration with authorities in the UK, Netherlands and European Union
[NB - translation by Yours Truly taken from the RÚV evening news, i.e. not an official translation.]
I think it’s safe to say that the collective Icelandic nation breathed a massive sigh of relief when this news was announced. The Icesave nightmare has had an impact on absolutely everyone here and the longer it’s dragged on, the heavier it’s become. I believe in the last few days most of us were just praying for a resolution [albeit an acceptable one - obviously] so parliament could begin to focus on other things, like helping households cope and the general reconstruction of the country. This dispute in parliament has commanded far too much time and energy.
The next step is for the amended agreement to be voted on in parliament. I’d say it’s 99.9% certain that it will be ratified.
Both Jóhanna [our PM] and Steingrímur J. [Finance Minister] were interviewed by RÚV this evening and expressed their satisfaction with the amendments. Asked if they feared an adverse response by British and Dutch authorities they said they did not – and that it was their belief that neither party could contest the amendments on any legal grounds. And in any case it was in everyone’s interest that Iceland would not be bankrupted by the agreement – that would serve no one.
I guess we’ll find out in the next few days.
IT’S BEEN A GREAT DAY
Worked this morning, then headed out for a run and then to the pool outside to enjoy the sunshine. We can certainly feel the autumn chill creeping in [there was a slightly cool wind] but it was still warm enough to lie in the sun and soak up some rays. Right now it’s getting pretty dark, 12°C [54F]. Sunrise this morning at 5:17 am, sunset at 9.44 this evening.
MORE ON THE ICESAVE AGREEMENT:
On the status of the Icesave debacle
On becoming an Iceslave
Eva Joly: Iceland is being blackmailed
For freedom and life
