Some of the country’s largest pension funds are currently working to a special investment fund in cooperation with labor unions and employer associations to reconstruct Icelandic companies and the economy as a whole.
The pension funds will make contributions to the fund, which is known as Endurreisnarsjódur atvinnulífsins (“The Economic Resuscitation Fund”). The size of the amount remains undecided, but the fund’s initial capitalization might be in the tens of ISK billions (ISK 10 billion = USD 67 million, EUR 53 million), Morgunbladid reports.
It has not been discussed whether the state will contribute to the resuscitation fund, but it is not out of the question. Preparations are well underway.
“The idea of this fund was born very early [in the crisis] at a special emergency meeting held following the collapse of the banks,” said Vilhjálmur Egilsson, managing director of the Confederation of Employers (SA).
Apart from SA and the pension funds, the Confederation of Labor (ASÍ) and the Iceland Chamber of Commerce are also involved in the resuscitation fund’s establishment.
“The fund’s role will be participating in and developing financially and operationally the resurrection of the Icelandic economy,” described Thorgeir Eyjólfsson, director of the Pension Fund of Commerce, who is representing Iceland’s largest pension funds in this project.
The resuscitation fund will be incorporated, although a limited partnership would also be an option. It is not intended for the fund to become an “emergency fund” but rather a fund that could become an investor in companies with a good potential for return.
President of ASÍ Gylfi Arnbjörnsson said many companies have lost their equity and are on the brink of bankruptcy and that it is important to refinance viable and profitable companies.