Lack of Currency Harms Businesses Skip to content

Lack of Currency Harms Businesses

Knútur Signarsson, managing director of the Federation of Icelandic Trade (FÍS), said that wholesalers are having problems with obtaining foreign currency to pay their partners overseas which is harming long-lasting business relations.

“Wholesalers are feeling angered. They are suffering unmeasured damage because they are considered defaulters. They say they have money but are unable to obtain foreign currency. People abroad generally don’t understand that. Business relationships that have lasted for decades are unraveling,” Signarsson told Morgunbladid.

The Central Bank of Iceland sent a notice to deposit institutions explaining that the flow of foreign currency would be limited on Friday. Companies involved in the import of food products, medicine and oil would be prioritized.

According to Signarsson, wholesalers also had difficulties obtaining foreign currency yesterday. “It is possible that people got something at the exchange rate index of 200 points, but as far as I’ve heard, most people didn’t get anything.”

The Central Bank of Iceland tried to fix the currency of the ISK last week with an exchange rate index of 175 points.

Hagar, the largest Icelandic importer, was able yesterday to send its first overseas payments for a few days, which, according to director of Hagar Finnur Árnason, should have been paid last week. Árnason said he had to decide which invoices were the most urgent and then pay them through the Central Bank.

Árnason said foreign suppliers had reacted in a noble way, provided that payments wouldn’t be delayed often or for long periods of time. Hagar enjoys long-standing and successful business relationships with most of its suppliers.

“A sufficient supply of foreign currency has to be secured,” Árnason concluded.

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