Iceland Prepares for Credit Crunch Skip to content

Iceland Prepares for Credit Crunch

Iceland’s Prime Minister Geir H. Haarde said in his speech during the Iceland Chamber of Commerce convention yesterday that the government has invited key individuals of the economy to a meeting today to prepare for a potential loan capital crisis.

“The government believes it is natural to be on alert and prepare to take action to lessen the negative ramifications of a potential credit crunch on international markets,” the prime minister said in his speech, Morgunbladid reports.

Haarde believes that adopting the euro without Iceland joining the EU is not a viable option since it would be costly, but companies ought to be allowed to use the euro as their operational currency if they like, within certain legal boundaries.

The prime minister further stated that it is important for Icelandic companies to keep their headquarters in Iceland.

Haarde also discussed current negotiations on wage contracts and said he hoped the agreements would have a positive effect on the economy and contribute to increased balance, lower inflation and trade deficit.

In his speech, Haarde mentioned that Iceland’s ministers are prepared to provide information and reports on the Icelandic financial market and economic life to foreign analysts, investors and reporters to correct possible misrepresentations.

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