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Icesave counter-offer rejected as turf houses appear on the horizon

In my self-appointed role as tracker of THE BLOB for the World at Large [that’s you], I herewith present the latest on the Icesave monster:

The Icelandic delegation went to London and Den Haag last week for renewed talks in an effort to avoid the Icesave referendum scheduled for 6 March. They talked and talked, then came back and talked some more. Predictably, very little was revealed about the nature or outcome of the talks [quelle surprise!] although a few people mumbled something about “fiddling with the interest rate.”

A day or two after their return, it was revealed that the UK and Holland had made a counter-offer to Iceland’s offer last week. What exactly this consisted of is about as murky as everything else surrounding THE BLOB, although Fréttablaðið quotes Wouter Bos, outgoing Finance Minister in Holland [they now have their own collapsed government], as saying it required Iceland to accept the following:

~ Full repayment of the loan

~ Fair compensation due to cost of the loan [interest]

~ Political unity in Iceland and the support of the President

~ That a simple solution be found [HA!] and for talks to proceed at a brisk pace

Hm. This was allegedly what they were discussing last week, but Sigmundur Davíð Gunnlaugsson [head of the Progressives] claims that the counter-offer sharply contradicts the terms being discussed then, which means that the above would NOT be included in the counter-offer. [Confused yet? Ready to have yourself committed to a padded cell wearing a straitjacket and gown open in the back? – You’re not alone.]

At least one of the above terms has been met, though, namely that there IS political unity in Iceland — to reject the mysterious counter-offer. This was done last night. On that occasion the Icelanders also proposed another round of talks.

Eyjan reports this morning that Dutch officials insist that Icelanders must agree to the fundamental criteria in their latest offer [the ones nobody knows about except a small handful of officials] — otherwise there will be no talks.

Meanwhile, Iceland’s Foreign Minister Össur Skarphéðinsson has requested a meeting with Hillary Clinton to discuss the International Monetary Fund’s refusal to continue with Iceland’s aid package unless Icesave is resolved.

This morning I spoke to a 75-year old gentleman who was fierce in his opposition to the Icesave bill. “We’re all heading back to the turf houses anyway, whether or not we accept Icesave. Under  no circumstances should we pay.”

The outcome of the referendum next week? Not that hard to predict.



Comments on this entry are closed.

  • alda February 24, 2010, 5:53 pm

    Big props to Laurence for being a good sport. We like. 🙂

  • Peter - London February 24, 2010, 6:46 pm

    “Iceland would not meet the criteria for joining the EU anyway (currently max 60% of publc debt to GDP).”

    Actually that is for joining the Euro not the EU, there is a difference.

    There is the full details of the steps Iceland has to take to join the EU here

    In summary, there is a lot. The Analytical Report section on the Common Fisheries Policy is interesting – apparently its being redesigned and Iceland could have a significant input to that process.
    Given Iceland’s new found poverty status there would be a lot of potential grants. Poland, for instance, gets Billions..

  • Tom Harper February 24, 2010, 9:54 pm

    Cheers, Laurence =)

    “- the majority of its representatives are not competent to deal with this current crisis”

    To be honest, I’m not sure anyone in Iceland is; this is very uncharted territory for them. I think Icelanders certain deserve their independence, but I also think they are going to have to look for inspiration, and even assistance, outside of Iceland to figure out this whole mess.

    “- whether a representative or direct democracy, all governments have problems (discrimination and poor decision making occur in all known forms of government – I’m sure you’ll agree)”

    Yes, of course!

    “Sorry, nothing personal.”

    I think we understand each other now =)

  • jpeeps February 24, 2010, 11:38 pm

    Michael Lewis

    1) [Mar 2008] “Given that Icesave pays 6.05% on their easy access internet savings account and ING pays 6.0%, perhaps shopping around for the highest savings rate right now is not actually the best thing to do.” But if you’re not shopping around but have happily invested £4 or 5k in 2007 in a spread-it-around sort of way please don’t even begin to give me a guilt trip.
    2) Moneyweek – not on my reading list I’m afraid – in fact with a
    circulation of around 30,000 not on many other people’s either. Give me some examples from National Dailies and Sundays and I’ll take it up with my financial adviser.

    Bottom line – my partner and I were fully compensated so have nothing to complain about. (The system WORKED!)

  • Lino February 25, 2010, 1:01 am

    @Peter – London

    “Given Iceland’s new found poverty status there would be a lot of potential grants. Poland, for instance, gets Billions..”

    easy on that, not that simple.
    Poland is 100 times Iceland’s population, and individually they are way poorer than icelanders. And still be so in the near future.
    EU is not a charity fund and EU poors or false poors (I’m referring to states, not individuals) are very combative at having their money not diluted by another beggar. Even richer states (those who pay) would not like having to pay more for what is, to all useful purposes, another freerider.
    Secondly, icelanders are/will be not poor but impoverished, makes a big difference, even from a moral point of view.

    And even in “end of the world scenario” for icelanders, I think they will still be much richer than rumanians and bulgarians: cheer up!

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