Finance Crisis Topples Iceland's Gov't

Letting its banks perish worked out for island nation

(NEWSER) - Don't look now, but Iceland's economy is growing. Tourism is up, the standard of living remains high, and unemployment is down to 7%. "For a country whose entire financial system collapsed, Iceland is doing remarkably well," the IMF's mission chief there tells the Washington Post . Why? In part because Iceland charted a unique course through the financial crisis: It let its big banks default and its currency collapse, and poured money into its economy and social safety net, raising taxes on the wealthy to do so. More»

Iceland's Geir Haarde says charge 'borders on political persecution'

(NEWSER) - Iceland’s legislature has decided to file charges against the country’s ex-prime minister over his role in the financial crisis. After a contentious vote yesterday, lawmakers voted 33-30 to refer charges against Geir Haarde to a special court, the AP reports. That’ll make Haarde the first world leader prosecuted in connection with the financial crisis—and the first to ever be tried by the special court in Iceland, which has never before convened. More»

With currency off 80%, golden arches fall

(NEWSER) - Soon there will be at least one country you can visit without seeing the golden arches. The financial crisis hit Iceland’s currency so hard that McDonald’s, which imports most of its ingredients, can’t afford to operate there anymore. “We would have to raise our prices by 20%,” the head of the country’s franchise holder said. “That would have sent a Big Mac to 780 kronur.” At roughly $6.36, that would make it the most expensive Big Mac in the world. More»

(NEWSER) - Iceland held fast to its independence as it rocketed to become one of the world's richest nations. But after a spectacular bust that decimated its currency and felled its government, the island nation has voted to join the EU. The accession plans are a victory for the country's new PM, Jóhanna Sigurdardóttir, who is trying to stabilize the country after its entire banking system collapsed. While the EU is nearly certain to accept Iceland's membership, meeting the bloc's economic requirements will take at least 18 months. More»

Leftist coalition seeks EU membership after economy's collapse

(NEWSER) - Iceland's interim center-left government, which came to power in February after the spectacular collapse of the nation's economy, has won a resounding victory in a snap election, reports the Times of London. The "great, historic victory" was an endorsement of her plans to have Iceland "start thinking about the EU," said Prime Minister Jóhanna Sigurðardóttir in her victory speech. More»