Icelandic authorities walk away from debt talks

It has been revealed that the Icelandic authorities have walked away from talks with the UK government and the Netherlands government with regards to the collapse of the Icelandic banking system back in 2008. It was just after this event that the Netherlands and UK authorities agreed a loan of $5 billion to the Icelandic authorities which was used to pay compensation to savers. However, even though a repayment plan for the $5 billion bailout package was agreed by the Icelandic parliament it was halted by the president under pressure from the Icelandic public.

It is ironic that the authorities have walked away from talks with the UK and Netherlands authorities with a referendum to be held this Saturday which will decide whether the repayment plan will be put in place or further talks will be needed. There would appear to be some disagreement over the potential interest rate on the $5 billion loan although it is the principle of a repayment plan which is most concerning the UK and the Netherlands government.

There has been much bad blood between the UK government and Icelandic authorities during and after the financial collapse with many in the country blaming Alistair Darling for various comments he made at the height of the issue.