Alexa
  • Directory of Taiwan

Iceland seeks more aid to fight financial crisis

Iceland seeks more aid to fight financial crisis

Icelandic Prime Minister Geir Haarde on Monday asked for financial support from fellow Nordic countries, saying the country's banking crisis could spread to the wider economy and result in massive layoffs.
Iceland _ whose banking sector collapsed under the weight of the credit crunch in October _ last week reached a tentative agreement with the International Monetary Fund for a $2 billion loan over two years. Haarde said he would ask his Nordic counterparts for more assistance during a meeting in Finland.
"The Nordic countries have all expressed their friendship and support in a very clear way," Haarde told reporters in Helsinki. "In this time of crisis, we are convinced ... we can count on our fellow Nordic friends."
He declined to give details on the support Iceland was seeking, saying he did not want to "put pressure" on his colleagues.
Haarde warned the meltdown would spread from the North Atlantic island's financial sector to other parts of the economy.
"Many will ... lose their jobs in the banking sector, many shareholders will be losing a lot of money and some people will be losing potential fortunes," Haarde told reporters in Helsinki. "The population in Iceland will be greatly affected. This will move us back four or five years."
Earlier Monday, Icelandic Business Affairs Minister Bjorgvin Sigurdsson said his country should consider applying for membership in the European Union and join the common EU currency to help in future financial crises.
Sigurdsson said a recent opinion poll indicated that 70 percent of Icelanders would approve of joining the EU, and that trade unions also had reversed policy and would like the country to apply for membership.
"My party, the Social Democratic Party, has backed applying for membership. We have pointed out the weaknesses of our small currency, the krona," Sigurdsson said. "I think this (crisis) will affect the EU debate in the coming months."
Haarde, however, said the time was not ripe for Iceland to apply for membership of the European bloc.
"I think that is something we shall discuss once we get through this crisis. We are day and night in crisis management," Haarde said. "We are trying to solve real problems right now, all of us; in the Cabinet, in Parliament, in the banks, in different businesses."
Haarde's comments came at the start of three days of meetings between Nordic government ministers and lawmakers in conjunction with the 60th session of the Nordic Council, which promotes governmental and parliamentary ties between the five countries.
Iceland was continuing talks with Russia over financial assistance, Haarde said, but did not give details.
It has also met with a Norwegian government delegation over possible financial assistance, and has called on a swap facility, drawing 200 million euros ($256 million) each from the Norwegian and Danish central banks.


Updated : 2021-05-19 03:02 GMT+08:00