Bjarni Returns as Prime Minister

Prime Minister Bjarni Benediktsson

Bjarni Benediktsson, current minister of foreign affairs and leader of the centre-right Independence Party, will become prime minister in the reshuffled coalition government following the departure of Katrín Jakobsdóttir from the office, RÚV reports.

Katrín announced last week that she would resign as prime minister and leader of the Left-Green Movement to campaign for the office of president, with presidential elections scheduled for June 1. This threw the future of her party’s coalition with the Independence Party and the centrist Progressive Party into uncertainty. A parliamentary election is scheduled for September next year, but the opposition has called for a snap election in light of these developments.

Bjarni’s return following privatisation scandal

At a press conference in Harpa concert and conference hall today, Bjarni announced that he would become prime minister. Bjarni was previously prime minister during a short-lived coalition in 2017 and finance minister for most of the period from 2013 to 2023. He resigned as finance minister in October of last year after the Parliamentary Ombudsman found that his role in the privatisation process of Íslandsbanki bank, which had been nationalised after the 2008 banking collapse, had not confirmed to guidelines.

He became minister for foreign affairs instead, with fellow party member Þórdís Kolbrún Reykfjörð Gylfadóttir becoming finance minister in his stead. Þórdís will now move back to the ministry for foreign affairs, where she served previously.

Embattled Svandís switches ministries

Sigurður Ingi Jóhannsson, leader of the Progressive Party, will now become finance minister. Embattled Minister of Food, Agriculture and Fisheries Svandís Svavarsdóttir, who was set to face a motion of no confidence in Alþingi, Iceland’s Parliament, this week, will become minister of infrastructure. In January, the Parliamentary Ombudsman found that she had not acted in accordance with law when she temporarily banned whale hunting last summer.

Her fellow Left-Green Movement MP, Bjarkey Olsen Gunnarsdóttir, will take her place in the ministry of food, agriculture and fisheries.

The changes will be formalised at a meeting of the cabinet with President Guðni Th. Jóhannesson at 7 PM tonight.

Iceland to Address Natural Disasters with New National Fund

Minister for Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir

Finance Minister Þórdís Kolbrún Reykfjörð Gylfadóttir plans to propose a bill establishing a national fund, financed with dividends from the operations of Landsvirkjun, Iceland’s National Power Company. The fund would be used to address unexpected challenges in the nation’s economy, such as those that have recently arisen following the geological unrest in Grindavík.

New urgency to old ideas

In an interview with RÚV earlier this week, Sigurður Kári Kristjánsson, former MP and current chairperson of Iceland’s Natural Disaster Insurance, stated that it was necessary for the government to establish a national fund to manage unconventional challenges, such as those facing the town of Grindavík (recent geologic unrest and a volcanic eruption in January have greatly damaged the town’s infrastructure). Such a fund would also be useful for unforeseen challenges related to climate change. 

Asked about this issue, Minister of Finance Þórdís Kolbrún Reykfjörð Gylfadóttir told RÚV yesterday that she agreed with this assessment and that she intended to present a bill for a National Fund (Þjóðarsjóður) that would undergo parliamentary processing this year. 

As noted by Mbl.is, the idea for such a national fund is not new. Former Finance Minister Bjarni Benediktsson proposed the establishment of a national fund in 2016 and that proposal was also included in the government coalition agreement of the Independence Party, the Left-Green Movement, and the Progressive Party in 2017. 

Þórdís Kolbrún herself delivered a speech at the annual meeting of Landsvirkjun, the National Power Company, in February of 2019, where she underscored this commitment to a national fund and explained how it would be financed:

“As you know, there has been discussion for some time about allocating dividends from the operations of Landsvirkjun to a National Fund, which will be used to respond to unexpected challenges in the nation’s economy. A bill regarding the National Fund has now been presented to Parliament, and I wholeheartedly support that we Icelanders show prudence and foresight in this manner.”

As noted by Þórdís Kolbrún, there were plans to present a bill about the national fund during the 2018-2019 parliamentary session, but it did not materialise.

Resolving the treasury’s debt first

Þórdís Kolbrún noted that the fund would not be established until the state’s debt situation following the pandemic improved. 

“We have dealt with a pandemic and now natural disasters, which Icelanders have, of course, experienced in the past. This is, nevertheless, an unprecedented situation,” Þórdís Kolbrún told RÚV, again underscoring that the fund would be financed by the profits of energy companies. 

“The idea is that these additional revenues from dividends from energy companies would, for example, go into the fund,” Þórdís continued. She observed that the fund was already on the parliamentary agenda and that she would present the bill again so that it could undergo parliamentary processing this year.

(Landsvirkjun, the National Power Company of Iceland, is a state-owned entity that generates between 60-70% of all electricity used in Iceland. The company operates a total of eighteen power stations across Iceland, which include fifteen hydropower stations, three geothermal power stations, and two wind turbines. Landsvirkjun’s financial results for 2022 were exceptionally strong, marking the best financial results in the company’s history. In a recent interview with Mbl.is, Minister of Foreign Affairs Bjarni Benediktsson stated that now was an opportune time to put the strong financial results from Landsvirkjun to good use in the form of a national fund.)

Emotions Run High at Grindavík Residents Meeting

Grindavík volcanic eruption January 2024

Displaced residents of Grindavík gathered at Laugardalshöll sports venue in Reykjavík yesterday to discuss the town’s future and demand action from authorities. The meeting was also attended by government ministers, scientists and public officials, Heimildin reports.

The town was evacuated Sunday as an eruption was starting in the vicinity. Yesterday morning, lava flow from both fissures north of Grindavík had ceased. The town of 3,800 inhabitants has sustained considerable damage, however, with three houses destroyed by lava and treacherous crevasses forming across the area. Grindavík is without electricity, hot water, and cold water, and lava has reportedly poured over water piping to the area.

Hoped her house would burn down

During the meeting, Bryndís Gunnlaugsdóttir, a Grindavík resident, pointed out the fact that those whose houses were destroyed by lava would get immediate compensation from the Natural catastrophe insurance of Iceland, a public institution. The rest of the residents, whose houses remain intact on the streets of an uninhabitable town, get nothing despite being displaced.

She said it was the worst day of her life when the eruption ended and she saw her house hadn’t burned down. “If my house had burned down, I would have gained financial independence. I would be able to start a new home and this noose around my neck would be gone,” she said and received a standing ovation from attendees.

Decades of activity possible

Prime Minister Katrín Jakobsdóttir, Minister of Infrastructure Sigurður Ingi Jóhannsson, and Minister of Finance Þórdís Kolbrún Reykfjörð Gylfadóttir all addressed the crowd. They said that government needed time to work out how to best assist the residents in their time of need. Some in attendance demanded that the government purchase all town properties to allow people to start over.

Kristín Jónsdóttir from the Icelandic Meteorological Office told attendees that repeated eruptions could be expected from the Sundhnúkagígur fissures to the north of the town. Uncertainty remains about the volcanic activity and whether it will manifest in one long eruption or several smaller ones. However, looking at the history of the Reykjanes peninsula, we could be at the start of several years or decades of activity.

Helping Grindavík

There are numerous ways in which you can provide support for the people of Grindavík, even if you do not live in Iceland. The Icelandic Red Cross has set up a page with donation options for those wishing to lend support. This includes both one-time donations and repeat subscriptions.

Iceland to Strengthen Support for UN Aid in Gaza

Minister for Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir

The Ministry of Foreign Affairs has announced that it will contribute 70 million ISK [$504,000; €477,000] to the United Nations Relief and Works Agency for Palestine Refugees (UNRWA), in response to a UN call for increased aid to Palestine.

This contribution is in addition to Iceland’s regular funding to the organization, which is one of Iceland’s cooperation partners in humanitarian matters.

Iceland Travellers in Israel Brought Safely to Jordan

Þórdís Kolbrún Reykfjörð Gylfadóttir, former Minister of Foreign Affairs, stated: “The terrible escalation of events in the Gaza Strip primarily affects ordinary citizens. The number of victims is in the hundreds of thousands. Iceland has condemned the actions of the terrorist organization Hamas and reminded Israel of the importance of adhering to international law, including human rights. Such words matter, but by making a significant financial contribution to help the victims of this crisis, we go beyond words and can alleviate the suffering of those who are suffering and are victims of these circumstances. I hope that the world’s nations will stand together in ensuring the safety and well-being of the civilian population in their response to the current situation.”

Iceland has cooperated with UNRWA for decades, and the organization provides humanitarian assistance and protection, basic education, health, and social services to Palestinian refugees in Gaza, the West Bank, and East Jerusalem, as well as those displaced in Jordan, Lebanon, and Syria. UNRWA is the main United Nations agency responding to the current crisis, providing assistance to both refugees and others affected by the conflict.

Last September, the Minister of Foreign Affairs signed a framework agreement with UNRWA for the continued support of Icelandic authorities to the organization for the next five years. With the additional contribution announced today, Iceland’s funding to the organization for this year matches the contributions specified in the binding agreement for coming years.

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Iceland to Close Embassy in Moscow

Minister for Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir

The embassy of Iceland in Moscow will be shut down on August 1, according to a press release from Iceland’s Ministry for Foreign Affairs. Icelandic authorities have also requested the Russian embassy in Reykjavík scale down its operations so there is no longer a Russian ambassador in Iceland. These changes do not mean a complete severing of diplomatic relations between Iceland and Russia, however.

Ukraine’s Minister for Foreign Affairs thanked Þórdís Kolbrún Reykfjörð Gylfadóttir, his Icelandic counterpart, for the decision to suspend operations of its embassy in Moscow and request Russia to limit the operations of its embassy in Reykjavík. “Russia must see that barbarism leads to complete isolation. I encourage other states to follow Iceland’s example,” he tweeted.

Þórdís Kolbrún told RÚV that the decision was made after extensive consideration, adding “it is not suitable for there to be so much Russian activity here in Reykjavík because of how relations are very limited and will continue to be until the Russians decide to behave in a different way than they are doing now.”

Iceland has operated an embassy in Moscow since 1944 with the exception of 1951-1953. The last time there was no Russian ambassador in Iceland was 1948-1954. “The decision to close down the embassy’s activities does not imply the termination of the diplomatic relationship between the countries,” the press release from the Ministry for Foreign Affairs states. “As soon as conditions permit, emphasis will be placed on resuming the activities of the Icelandic embassy in Moscow.”

Iceland Authorises US Submarines in Coastal Waters

Minister of Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir

US Navy nuclear-powered submarines will be allowed to stop close to Iceland and the first one is expected soon. Iceland’s Minister of Foreign Affairs has specifically stated to the US authorities that these submarines cannot carry nuclear weapons in Iceland’s territorial waters.

According to Minister of Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir, this decision is in line with Icelandic authorities’ policy to support increased surveillance by NATO states, increasing the security of marine infrastructure such as marine telecommunications cables in the ocean around Iceland. The frequency of the visits will be assessed according to need. The authorisation for submarines is not restricted to a specific period and there will likely be a few visits per year. Each time a submarine approaches, it musest request permission. Þórdís Kolbrún told Vísir that the decision was not only made to increase telecommunication security but also to fulfil obligations to NATO and defence in the North Atlantic.

The first submarine is expected soon. It will be allowed to restock supplies and bring on new crew members a few kilometres off the coast of Iceland but will not dock as Iceland doesn’t have the harbour infrastructure to support submarines. Þórdís states that the submarines will stop outside the Reykjanes peninsula.

Both the Prime Minister and the Foreign Minister stress that foreign military vessels’ arrival in Iceland is conditional on the respective country’s knowing and respecting Iceland’s National Security Policy which states that Iceland and Icelandic waters will not host nuclear weapons. This position has been reiterated in the Foreign Minister’s note to US authorities. Submarines authorised to stop in Icelandic waters will not carry nuclear weapons nor will they be fitted for such weapons. When asked if Icelandic authorities had any guarantee US authorities would comply with Iceland’s demands, Þórdís Kolbrún replies that it is a matter of trust.  “We base this on our solid communication with US authorities. These kinds of submarines don’t carry nuclear weapons. We have issued clear declarations and a clear policy and we’ve gotten confirmation that the Americans will honour it. Norway has a similar policy and their cooperation has been without issue for decades,” Þórdís stated.

All submarines in the service of the US Military are nuclear-powered. All seafaring vessels are authorised to cross Icelandic waters on peaceful missions, but foreign governments must apply to the foreign ministry if they want their vessels to stop Iceland’s territorial waters.

Primacy of EEA Rules Does Not Include Transfer of Legislative Power, Foreign Minister States

Minister for Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir

Minister Of Foreign Affairs Þórdís Kolbrún Reykfjörð Gylfadóttir has presented a bill to Parliament ensuring the primacy of EEA rules introduced into Icelandic legislation over other national legislation, meaning that in the case of conflict, EEA rules will prevail.

The bill is a response to EFTA Surveillance Authority complaints, which has issued a reasoned opinion to Iceland concerning its failure to fulfil its obligations under Protocol 35 to the EEA Agreement and Article 3 of the EEA Agreement, as there is no mention of EEA rule precedence in Icelandic legislation.

“This bill is just one sentence that would do so,” Þórdís Kolbrún told RÚV, stating that a main point was that the article only applied to EEA regulations that Parliament had already approved, thereby making it national legislation. “The changes in wording might change the way courts interpret the law but it is of course up to them to make those judgements,” she added. In response to criticism from a member of her own party, Þórdis added that “Protocol 35 explicitly states that it does not include any transfer of legislative powers to any institution of the European Economic Area. The primacy rule will only affect articles of Icelandic legislation instituted by Parliament in case of a conflict where one contradicts another.”

PM Katrín Jakobsdóttir to Meet Zelenskyy Today

katrín jakobsdóttir ukraine zelenskyy

Katrín Jakobsdóttir, Prime Minister of Iceland, is set to meet Ukrainian President Volodymyr Zelenskyy and other Ukrainian officials today, March 14.

With the European Council set to meet in Reykjavík this May, Katrín has previously stated that it’s key for Icelandic leaders to meet with Ukrainian officials, given the central role the Ukrainian conflict will play in the summit.

Prime Minister’s Office Iceland

Katrín and other Icelandic officials were shown some of the signs of the conflict this morning and will meet with Zelenskyy in the afternoon. Katrín and her entourage were also seen laying commemorative wreaths for the victims of the war.

The Prime Minister stated to Morgunblaðið: “We were first shown ruins in Borodianka, apartment buildings that have been blown up, and then we went to talk to some of the residents. Then the road led to Bucha, where newspaper photographs of the mass graves found there are on display. There, we met the mayor Anatolij Fedorúk, who explained the situation to us […] It’s a completely different thing to see this yourself and meet these people, who have been through this horror.”

Bucha, a suburb of Kyiv, was the site of a civilian massacre by Russian troops during the initial invasion in 2022. In April of last year, photographs emerged in the press that indicated that some 400-500 civilians had been summarily executed by Russian forces. The massacre at Bucha has been identified as a likely war crime in the conflict.

katrín jakobsdóttir ukraine zelenskyy
Prime Minister’s Office Iceland

Now, Katrín is on her way to meet directly with Zelenskyy. Among her retinue is also Foreign Minister  Þórdís Kolbrún Reykfjörð Gylfadóttir.

A major item on the agenda will be Zelenskyy’s participation in the upcoming meeting of the European Council. Although his participation is confirmed, it is not clear yet whether he will be attending remotely, or whether he will come to Iceland for the summit.

Katrín stated further: “We will be reviewing the upcoming meeting in May, as Ukraine will be the focus there. The involvement of the European Council will potentially comprise of assessing damages, possible compensation for Ukraine, and so on.”

 

Iceland’s Prime Minister Travelling to Ukraine

Katrín Jakobsdóttir Bjarni Benediktsson Sigurður Ingi Ráðherra

Iceland’s Prime Minister Katrín Jakobsdóttir and Foreign Minister Þórdís Kolbrún Reykfjörð Gylfadóttir are on their way to Kyiv, Ukraine’s capital city, to meet with Ukrainian President Volodymyr Zelenskyy and other Ukrainian officials, Vísir reports. One of the topics of discussion will be Ukraine’s participation in the fourth summit of the Council of Europe, to be held in Reykjavík in May.

Katrín and Þórdís Kolbrún’s trip has not been highly publicised, likely for reasons of safety. They will head to the country from Poland today on a trip that will reportedly take all day and all evening.

The main purpose of the visit is to underline Iceland’s continued support and solidarity with Ukraine in the country’s defence against the illegal Russian invasion. The Icelandic and Ukrainian officials are scheduled to meet tomorrow. Reporters from Iceland’s national broadcaster RÚV are travelling alongside the Prime Minister and Foreign Minister and will report on the meetings tomorrow.

Read More: Council of Europe Summit to be Held in Reykjavík

The Council of Europe summit set to take place in Reykjavík on May 16-17 is the fourth-ever in the organisation’s 73-year history. Considerable security precautions will be in place during the summit, and Icelandic authorities have requested the assistance of foreign police forces for the event.

Some 46 nations are party to the Council of Europe, which is the oldest active pan-European organisation.

ISK 80 Million Towards Reconstruction Efforts in Afghanistan

The Icelandic government will contribute ISK 80 million [$583,000; €575,000] to the United Nations Multi Partner Special Trust Fund for Afghanistan. The funds are to be used for development projects in the country as well as humanitarian aid. The United Nations estimates that more than half of the country’s population currently requires humanitarian aid.

“Afghanistan is in complete crisis and the need for both humanitarian and development aid is extremely urgent,” Iceland’s Foreign Minister Þórdís Kolbrún Reykfjörð Gylfadóttir stated. “It is therefore extremely important that Iceland does its part to respond to the disasters that have occurred there, both caused by nature and humans.”

Last month’s deadly earthquake worsened already difficult conditions in Afghanistan. Social infrastructure has collapsed and access to basic services is extremely poor.

The Multi Partner Special Trust Fund prioritises projects that focus on ensuring basic services, providing for people’s basic needs, promoting economic recovery, protecting agriculture against natural disasters, and increasing resilience and social cohesion.

Iceland’s Prime Minister Katrín Jakosdóttir stated last year that the country must shoulder responsibility for the situation in Afghanistan, both as a member of NATO and as representatives in the UN human rights council.