Iceland president’s Icesave decision drawing harsh international response

olafur-ragnar-II1President of Iceland, Olafur Ragnar Grimsson’s decision not to sign the Icesave Agreement into law yesterday has already drawn responses from other countries, including the UK.

The Times reports that the British treasury is potentially considering seizing Landsbanki’s remaining assets in Britain as reimbursement for Iceland’s Icesave debt.

The Icelandic president’s decision means the law will go into force, but must be voted on by the public before 5th March, if parliament chooses not to repeal the bill instead. Sources last night indicated that the government intends to continue pushing the existing bill and will therefore introduce a bill on a national referendum to parliament this Friday. If the nation votes ‘no’ (as polls indicate it will), the current Icesave Bill would be pushed beyond resurrection and the bill passed by parliament and the President in August, but rejected by the UK and Netherlands, would come back into force.

In the meantime, British and Dutch authorities intend to meet and establish a joint position and course of action on the matter. The British delegation will be led personally by Chancellor Alistair Darling and Banking Minister Lord Myners.

In related news, Norway has said its promised loan to Iceland will definitely not be paid out before the national referendum has been settled.

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