Iceland to Ask the EU for Better Icesave Loan Terms? Skip to content

Iceland to Ask the EU for Better Icesave Loan Terms?

It is believed that Prime Minister of Iceland Jóhanna Sigurdardóttir will discuss new debt financing on Icesave from a European Union fund—which would involve much better terms than British and Dutch authorities have offered—during her meeting with President of the European Commission José Manuel Barroso and other key EU executives today.

Prime Minister of Iceland Jóhanna Sigurdardóttir. Photo by Páll Kjartansson.

According to Morgunbladid’s sources, the coalition parties are not in agreement on where to look for new debt financing.

Allegedly, Minister of Finance Steingrímur J. Sigfússon has approached Norwegian authorities with similar ideas on a more favorable loan with a lower interest rate to cover the Icesave debt than is currently being offered by the UK and the Netherlands.

Lars Egeland, spokesman for the Norwegian Socialist Left Party (SV) confirmed in an interview with the Norwegian news web ABC last night that the Norwegian government has changed its policy regarding their loan to Iceland, which is part of the International Monetary Fund bailout package.

Until now, the loan’s disbursement has been postponed along with the IMF’s postponement of the review of the economic stabilization program for Iceland because of the unsolved Icesave dispute with the UK and the Netherlands. Now Norway wants to have the loan disbursed even though the dispute is unresolved.

MP for the Left-Greens Björn Valur Gíslason told Morgunbladid that the Icelandic government has lobbied for such support from Norway for months. “However, this is a co-Nordic loan and other Nordic countries have not taken this step,” he pointed out.

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