The total debt of the Icelandic treasury increased by ISK 437.2 billion (USD 3.46 billion) last year from ISK 288 billion up to 725.2 billion. This information comes from a government financial report for 2008 which has just been released. As a percentage of GDP, net debt increased from 22.1 to 49.5 percent in 2008.
The position of domestic debt rose from ISK 156.7 billion to ISK 613.8 billion. The increase is partly accounted for by ISK 270 billion bonds to the Central Bank of Iceland because of the takeover of the country’s financial system.
The treasury’s external debts roughly doubled when calculated in Icelandic kronur in 2008 from ISK 154 billion to ISK 317.5 billion. The increase can largely be explained by the serious reduction in krona exchange rates during the year.