The Icelandic finance ministry announced on Thursday evening that the latest round of talks between the parties had “adjourned without a final resolution.”
“Constructive proposals were made by both sides during these talks, but significant differences remains.”
Steingrímur Sigfússon
Talks between Iceland and the UK and the Netherlands over the Icesave banking dispute collapsed late Thursday, making a referendum on a previously agreed deal more likely, a vote the government in Reykjavik is almost certain to lose.
The Icelandic finance ministry announced on Thursday evening that the latest round of talks between the parties had “adjourned without a final resolution,” according to EUobserver.
Representatives of the three parties had been meeting in London for the last two weeks.
“We had hoped to be able to reach a consensual resolution of this issue on improved terms”, said Icelandic finance minister Steingrímur Sigfússon, “but this has not as yet been possible.”
“Constructive proposals were made by both sides during these talks, but significant differences remain,” he added.
Icelandic negotiators are to return to Reykavik to discuss what is to be the government’s next move.
After the Icelandic Icesave internet bank collapsed in 2008, depositers in the UK and the Netherlands were compensated by their governments to the tune of €3.8 billion. The Hague and London now are demanding Reykjavik pay them back.
The government has agreed to do so, but the terms are considered onerous by a majority of the population. Under the terms of the agreement the loan will be paid back over 15 years with interest, with estimates suggesting every household will have to contribute around €45,000.
The UK-Dutch side had reportedly offered reduced interest rates and a suspension of interest for two years, an position described by the Dutch as their “best offer”.
The Icelandic side felt that the interest applied would still be too high to be palatable domestically.
The Icelandic president had refused to sign the government bill that approved a schedule of payments to the two governments, provoking a referendum on the matter due on 6 March, which analysts and pollsters expect the government to lose.
In trying to negotiate better terms for payback of the debt, the government had hoped to avoid the vote, as it is certain to threaten the supply of international financial aid.
The referendum is now likely to proceed and a No vote all but assured.
The development further threatens the likelihood of Iceland acceding to the European Union, as the UK and the Netherlands have hinted that they will block accession talks with the north Atlantic nation if the Icesave issue is not resolved.
Related articles by Zemanta
- Hopes of Icesave deal dwindle (seattletimes.nwsource.com)
- Iceland Walks Out of Icesave Talks With U.K., Dutch (Update2) (businessweek.com)
- Iceland PM still hopeful after Icesave talks fail (financialpost.com)
- Talks Stall Over Repayment of Iceland’s Debt (nytimes.com)
- Sigurdardottir Says Icesave Accord Is ‘Realistic’ (Update1) (businessweek.com)
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=166b0aa7-2de5-4b91-b681-830bd87cea02)
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=07478597-2f87-4726-bf1a-f1ce2a85705e)
Consumer Confusion Index At Record High
The latest Norwegian CCI numbers was released Friday, and shows a small increase of 0,5 points. Still, the country’s two main providers of electronic financial news manage to present two totally different views on the consumer confidence. According to DN.no, the Norwegians’ confidence about their own economy is strengthening, but the competitor E24.no says is weakening.
“Uncertainty about the development of both unemployment and interest rates probably contribute to the restrain in consumer confidence.”
Mari Paulsrud
In spite of the recent less-worse-the-expected numbers from the Norwegian labor market, the Norwegians continue to be skeptical about both the national and their personal economic future. They’re even planning on saving more money in the next 12 month. Now, that’s really confusing to the nations establishment of economists.
Norway is a funny little country.
It sees itself as one of the most democratic states in the world, although the country has been ruled by the same socialistic political party for more than 70 years.
(Except for a few short guest appearances by the conservatives).
Almost ethical and morally flawless, an environmental frontier, (and the only people with balls big enough to stand up to Hitler in WWII).
Yeah, well, I won’t go down that road. Not today.
I will only point out another Norwegian characteristic; the ability to justify every opinion with the exact same argument.
Today’s amusing example is illustrated by the headlines of Norway’s two main financial news sites, DN.no and E24.
While one is reporting that the Norwegian consumer confidence is strengthening, the other is reporting that it’s weakening.
They both use the exact same quotes by macro economist Mari Paulsrud at the research institute, Opinion AS, to argue their case.
Pretty Flat
But – first – let’s look at the actual number.
Norway’s CCI came in at 8,7 points in February, up 0,5 percentage points from January, and up from 0,0 points a year ago.
And the economist Mari Paulsrud makes it pretty much clear in her statement.
“Consumer confidence rose slightly this month, but continues to remain relatively flat, as it has done several months in a row. This reflects some uncertainty among consumers and there are still some hesitation when it comes to optimism.”
“Uncertainty about the development of both unemployment and interest rates probably contribute to the restrain in consumer confidence.”
Paulsrud also emphasize the fact that the actual confidence is declining, but an increase in peoples willingness to save money makes the sum of all the sub indexes positive.
Half Empty – Half Full
Yet, it results in these two headlines:
DN.no (Dagens Næringsliv):
E24.no (VG, Aftenposten):
And actually they’re both kinda telling the truth.
If you see the CCI numbers over a years period of time, the confidence is getting better.
But if you look isolated at the last few months, the rise in optimism is curbing.
Consumer Confusion Index
The most confused people here is probably not the Norwegian consumers, but the members of the mainstream media and the national establishment of economists.
The latest development in the labor market has been far less worse than expected a year ago. Low rates, combined with practically no inflation and rising wages has given most Norwegians more spending power. And the housing market is back on a fast track to heaven.
So, why aren’t the “consumers” more optimistic? Taking up more loans and running down the shops? (as they’re supposed to, according to theories).
Well, here’s the real news: THEY ARE NOT THAT STUPID !
(By the way; here’s economist Mari Paulsrud’s Blog Post on the latest CCI numbers).
Related by the Econotwist:
Evaluation Of Norwegian Monetary Policy
Norway’s GDP Fall For First Time In 20 Years
End Of The European Upswing?
Final Words Of A Central Banker
How To Make A Rat Look Like A Puppy
Norway: Key Policy Rate Remains Unchanged
Norway Economic Update – “Partly Grim”
Fear Of Norwegian Housing Market Collapse
Fighting The Reality
Norway’s Prime Minister Fears Social Unrest
Central Bank of Norway raise interest rate again
Roubini: “The Worst Is Yet To Come”
Robert Schiller: – Recovery is just luck
“The Norwegian Syndrome”
Not So Rosy After All
Crisis In A New Light
Related articles by Zemanta
2 Comments
Filed under National Economic Politics
Tagged as Add new tag, Aftenposten, Central bank, Consumer confidence, Consumer Confidence Index, Current Events, E24 Næringsliv, Economy, Financial Markets, Genealogy, Government, Health and Environment, Inflation, Labour economics, Mari Paulsrud, Mass media, Norges Bank, Norway, Sweden, United States, Views, commentaries and opinions