Felix Salmon

Iceland says no

By Felix Salmon
March 6, 2010

Does any referendum, ever, get a 98% no vote — especially when it’s a referendum on a bill which was passed by a democratically-elected legislature? The first reaction is that the people have obviously spoken with one voice. But then the question arises: What have they said?

It’s worth noting, here, that the bill they were voting on — that Iceland repay its $5.3 billion debt over 15 years, with 5.5% interest — is no longer the deal being offered by the UK and Holland, which have now offered a two-year interest holiday and a lower interest rate. And it’s also worth noting that the “no” vote was certainly split between people saying “no to this deal” and people saying “no to any deal”.

So maybe this is simply a sensible national negotiating tactic, giving Iceland some small amount of leverage in the run-up to a new deal being hammered out in coming weeks.

Or maybe it’s just in the national character to want to stand up to bullies.

3 comments so far | RSS Comments RSS

I’m having a cod wars déjà vu moment here.

Posted by Zardoz | Report as abusive

The danger of turning down this deal is that IMF witch doctors may stop offering Iceland their medicine of bleedings and leeches… wait a minute, that’s a problem?!

Posted by johnhhaskell | Report as abusive

Felix, you could report that Iceland is, in fact, keeping its treaty obligations with the EU. This “deal” is nothing more than the UK whining about how they deserve special treatment. Make no mistake about it: The EU proscribes an FDIC-style of protection for individual accounts.. up to a certain value, and over that everything’s gone. The “deal” described in your article is only sent to the Iceland citizenry because the UK is demanding that Iceland guarantee ONE HUNDRED PERCENT of deposits.

The blame lies with the UK’s politicians, not with Iceland. This is definitively not “Iceland’s debt” — they never agreed to anything of the sort.

Posted by Unsympathetic | Report as abusive

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