Lögberg-Heimskringla - 15.12.2008, Blaðsíða 2

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2 • Lögberg-Heimskringla • 15 December 2008
Iceland to pay ISK 245
billion for Icesave?
The net expenses that the Icelandic state has to cover because of deposits of Ice-landic banks in foreign countries will
amount to approximately ISK 245 billion (USD
1.8 billion, EUR 1.4 billion) according to a pre-
liminary estimate by the International Monetary
Fund (IMF).
While Prime Minister Geir H. Haarde and
the former majority owner of Landsbanki,
Björgólfur Gudmundsson, have stated that the
assets of the banks are likely to cover the depos-
its, the IMF does not appear to share their esti-
mates. The IMF calculates that the assets of the
Icelandic banks abroad will only cover about
half of claims made by foreign states because of
insured deposits, Fréttabladid reports.
According to IMF’s estimates, the gross
expenses of the Icelandic state because of the
deposits will amount to 47 percent of this year’s
gross domestic produce (GDP). Assuming
that the bank’s assets suffice for roughly half,
around 19 percent will be the responsibility of
Icelandic tax payers.
Iceland’s GDP in 2007 was more than ISK
1,293 billion (USD 9.2 billion, EUR 7.1 billion)
according to numbers from Statistics Iceland.
Although it is unclear what this year’s GDP
will be, the IMF expects Icelandic tax payers to
be responsible for paying ISK 245 billion for
foreign deposits, most of which are deposits
in Landsbanki’s Icesave. However, Glitnir and
Kaupthing banks also had deposits abroad.
That means that every Icelandic resident will
be indebted by ISK 800,000 (USD 5,700, EUR
4,400) because of these deposits alone. To put
these amounts in perspective, Fréttabladid states
that ISK 245 billion would suffice to cover the
operations of Iceland’s entire healthcare system
for two years.
The newspaper was unable to receive com-
ments from the resolution committees of the
banks and Minister of Commerce and Banking
Björgvin G. Sigurdsson.
Reprinted with permission from Icelan-
dReview.com.
The Crisis Game to
hit Icelandic stores
Icelandic casual game developer Gogogic is developing a new board
game, The Crisis Game
(Kreppuspilið in Icelan-
dic), which is predicted to
become this year’s hottest
Christmas present. People
can help developing the
game by proposing texts for
drawing cards.
Until midnight Novem-
ber 30, people were able to
submit their suggestions on-
line. When players land on
specific squares on the board
they draw one card to find
out what to do next. A num-
ber of people submitted their
suggestions, which include:
“A former ‘outvasion
Viking’ buys all hair salons
in the country only to close
them down. You could expe-
rience some haircut difficul-
ties and have to move back
two squares.”
“You child benefits will
be paid on a monthly basis
to help you make ends meet,
but unfortunately they don’t
cover the postal rate and will
thus be abolished.”
“Your younger cousin
who performed so poorly at
school suddenly earns your
double salary—as a taxi
driver in Copenhagen.”
Gogogic plans to release
the board game (in Icelandic
only) next month and it will
be available in stores as of
mid-December. In the spirit
of the game, the price will
be moderate.
Reprinted with permission
from IcelandReview.com.
Iceland presents plan to save companies
Leaders of Iceland’s gov-ernment, Prime Minister Geir H. Haarde and For-
eign Minister Ingibjörg Sólrún
Gísladóttir, presented a 12-step
plan to help companies cope
with the economic crisis at a
press conference recently.
According to the govern-
ment’s plan, the boards of the
new banks will have extensive
responsibilities. They are to es-
tablish clear and transparent cri-
teria on how to undertake exten-
sion of loan periods and change
the compositions of loans, re-
duce loans and merge compa-
nies, Morgunbladid reports.
The board of the banks will
also be responsible for increas-
ing supervision with the banks’
operations, encouraging compe-
tition while reorganizing com-
panies and administrating assets
of companies where debts have
been changed into equity.
The 12-step plan is as fol-
lows:
1. The board of the new
banks will establish clear and
transparent guideline regula-
tions on financial service to lo-
cal companies.
2. Special asset administra-
tion associations on behalf of
the banks will be founded to
administer assets in companies
where debts have been changed
into equity.
3. An independent represen-
tative for each customer will be
appointed in each of the banks.
4. While reorganizing com-
panies, competition will be en-
couraged and restricted as little
as possible.
5. The government will
support the establishment of a
powerful resuscitation fund for
the economy with participation
of pension funds, banks and
other investors.
6. The resuscitation fund
will be managed well and in
such a way that the sociological
responsibility of companies is
considered.
7. The government declares
intent to ease the settlement of
debt with foreign claimants
by offering them shares in the
new banks.
8. Companies will be per-
mitted to settle their annual ac-
counts in a foreign currency as
of January 1, 2008.
9. The pension funds are
permitted to own real estate for
which they have provided long-
term loans and which they rent.
10. Special emphasis will be
put on creating labor-demand-
ing employment in cooperation
with municipalities.
11. The government will
have certain provisions of
laws regarding limited compa-
nies, taxations and other laws
reviewed.
12. The government will, in
cooperation with labor unions
and employer associations, re-
consider recently-established
regulations on currency re-
strictions.
Jón Steindór Valdimarsson,
managing director of the Federa-
tion of Icelandic Industries (SI),
said it appears as if only those
companies which fulfill certain
regulations can settle their ac-
counts for 2008 in euros.
However, there are many
good ideas in the government’s
12-step plan, Valdimarsson said,
although information on when
they will be executed is lacking.
Chairman of the Associa-
tion of Local Authorities in Ice-
land, Halldór Halldórsson, is
satisfied with the government’s
plans to create labor-demand-
ing employment in cooperation
with municipalities.
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Continued on page 5
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