Three to Four Hundred WOW Staff Still Unemployed

Flight attendants WOW air Icelandair

Three to four hundred former WOW air staff are still unemployed over six months after the airline declared bankruptcy, according to the Directorate of Labour. The company’s employees, numbering around 1,100, all lost their jobs when the airline went bankrupt in March this year. Unemployment numbers are higher than the directorate had predicted.

“They’ve been decreasing slowly and steadily but maybe not as quickly as we hoped,” stated Unnur Sverrisdóttir, the director of the organisation, in an interview with RÚV. “There are still about three to four hundred left and the biggest group are flight attendants.”

Unnur says WOW’s former staff that remains unemployed is generally well educated. If plans to found two new airlines prove successful, that could provide needed jobs. Many pilots who were employed by WOW have, however, already found work abroad.

Unemployment rates are higher this year than projected. An unemployment rate of 4% is expected in December, though it is projected to lower in March of next year. The number is uncharacteristically high for Iceland, and Unnur says she hopes to see improvements next spring.

Central Bank Lowers Interest Rate Again

Central Bank of Iceland

The Monetary Policy Committee (MPC) of the Central Bank of Iceland has decided to lower the Bank’s interest rates by 0.25 percentage points. The Bank’s key interest rate, the rate on seven-day term deposits, will therefore be 3.25%. The decision comes only one month after the bank lowered its interest rates by 0.25% from 3.75% to 3.5%.

“Leading indicators imply that economic activity will continue to slow, although there are signs that the economy may be regaining a foothold,” stated a press release from the Central Bank. “Recent developments suggest that economic activity has been stronger than previously assumed. On the other hand, the outlook is uncertain, particularly for the global economy. As a result, domestic GDP growth could weaken more rapidly than is currently expected.”

East Iceland Towns Propose New Form of Local Government

Borgarfjörður eystri east iceland

Residents of four East Iceland localities will vote later this month on whether or not to consolidate under a single municipal government. If the localities do join together, each would retain a three-member “home council,” an arrangement unprecedented in Iceland. RÚV reported first.

On October 26, residents of Borgarfjarðarhreppur, Djúpavogshreppur, Fjótsdalshreppur, and Seyðisfjörður vote on the proposal to merge their municipalities under a single government. If the proposal is accepted, the localities would share a single council of 11 representatives, while each of the four localities would retain a council of three members with more localised authority.

The idea of home councils was put forth as a response to the criticism that smaller communities would lose influence through consolidation. The councils’ goal is to ensure that local residents still have an impact on their local services. The concept is built on experimental provisions on governance in 2011 legislation concerning local government. If the four localities do join together, it will be the first time the provision is applied.

Home councils oversee land use

Two members of each home council would be elected directly by the locality’s residents, while the third would have a seat on the municipal council. The representatives would have equal authority. While the municipal government would decide on general zoning plans, detailed land-use plans would be under the jurisdiction of the home councils. While the general environmental policy would be determined by the municipal council, specific environmental projects within a locality’s area would be in the hands of its home council. Home councils would therefore have a big influence on environmental protection as well as development within their locality.

Fewer representatives with more authority

The four East Iceland localities currently have a total of 113 representatives on their local councils. With the merging of the four localities, this number would be lowered to 42.

EEA Membership Advantageous to Iceland, Experts Say

EEA Report Iceland

A task force appointed by the Minister for Foreign Affairs has turned in their report on Iceland’s membership in the European Economic Area (EEA). Its conclusion is overwhelmingly positive, stating that the EEA Agreement is advantageous and rewarding to Icelandic citizens, as well as businesses and institutions. This year marks the 25th anniversary of the EEA’s establishment.

EEA prevents isolation

Minister for Foreign Affairs Guðlaugur Þór Þórðarson appointed the task force in August last year following the request of 13 MPs to investigate the pros and cons of Iceland’s membership in the EEA. The report’s authors met with nearly 150 individuals in Iceland, Belgium, Liechtenstein, and Norway in the making of the document, which took one year.

Björn Bjarnason, who served terms as both Minister of Education and Minister of Justice, was the task force’s chairman. He says expert opinion was overwhelmingly supportive of the agreement. “We spoke with 147 people in the making of this report and only two expressed opposition to the agreement, a representative of [Icelandic association] Frjálst land and a representative of No to EU in Norway,” Björn stated. The report goes even further to state that were Iceland not a member of the agreement, there would be a significant risk of isolation, stagnation, and regression for the country.

Benefits to education and health

It’s not only Icelandic businesses and institutions that benefit from the country’s membership in the EEA, RÚV reports. Freedom of movement, one of the cornerstones of the agreement, has enabled around 40,000 Icelanders to study abroad through the European Union’s educational scheme. Furthermore, the European health insurance card ensures Icelanders’ right to healthcare services in other EEA member countries and reimbursement for costs accrued. In the past three years, 150,000 such cards have been issued in Iceland.

Cell phone users can also thank EEA regulations for lower costs when using their phones abroad. The agreement ensures tariffs are uniform across all member countries, which has likely saved Icelanders a fair amount of cash.

Stricter legislation

The report found that 16% of all legislation adopted in Iceland over the past 27 years is a direct result of Iceland’s membership in the EEA. Had Iceland prepared such legislation independently, the reports authors state, it would have risked negative economic and social effects.

Iceland has crafted some 26 exceptions to EEA regulations, mostly related to the making of statistical reports, technical rules, and energy. Those interviewed for the report criticised what they called Iceland’s “gold plating” of EEA regulations, meaning they were implemented with more strict conditions in the country. Such exceptions were said to make Icelandic businesses less competitive.

The report abstained from investigating what effect Brexit would have on the EEA Agreement, as it was considered impossible to predict the results of the UK’s departure.

Pedestrian “Stumbles Upon” Live Hand Grenade in Ásbrú


Last Sunday, a pedestrian passing through the defunct Patterson Airport in Ásbrú in Reykjanesbær, Southwest Iceland, chanced upon a live hand grenade, Vísir reports. The discovery was subsequently reported to the police authorities, who dispatched an explosive expert to dispose of the grenade. According to a statement by Suðurnes Police, the grenade is believed to have been active. The police could offer no further information concerning the incident, besides stating that the grenade’s disposal was successful.

The former U.S. Naval Air Station Keflavík was built during World War II by the U.S. Army (U.S. forces withdrew in 1947 but returned in 1951). Numerous pieces of unexploded ordnance have been discovered near Ásbrú in the past, especially during the Icelandic Coast Guard’s clearing of the area, following the evacuation of U.S. forces in 2006.

The Coast Guard advises visitors of the area to be careful and to report all unexploded ordnance to the authorities immediately.