Iceland has major financial problems. The currency is in free fall, and interest rates rises sharply. Iceland has already nationalised the third largest bank in the country.
This has triggered a debate in Iceland about EU membership and adoption of the euro as currency. I do not not have strong opinions about how Island should arrange themselves in relation to the EU, but I think that it’s time for that Norway do what we can to help Iceland in this situation. Norway is in a very strong financial position. We can make sure that the icelandic government and central bankhave to money and credibility to back up it’s currency and contribute to get the Icelandic economy back up.
The BBC writes today:
The country’s credit rating was slashed after the Glitnir nationalisation. The Icelandic krona, which had lost more than half its value since last summer, lost a further 14% this week.
The government is openly divided on whether to keep the currency or ditch it – and adopt the euro.
There’s a growing sense that this country, with just 300,000 people, is too small to cope. Sigurdur Kristjanson, an MP from the prime minister’s party, disagrees.
I’m no economist, but I’m sure that Norway has the ability to back up a neighbour in need. The Norwegian primeminister and minister of finance should let the Icelandic government know that we are ready to help if they need it.
It’s the least we should do.
I found an interesting blog here