Brown urged to show statesmanship

Iceland's president has urged Gordon Brown to show statesmanship over Iceland deal
12 April 2012

Iceland's president called on Gordon Brown to show statesmanship and agree a "fair deal" for his country after the referendum, which is expected to throw out plans to pay £3.5 billion to Britain and the Netherlands for lost deposits when a major bank collapsed.

Polls suggest that as many as three-quarters of Icelanders will vote No in the referendum on a deal which has already been effectively superseded in talks between the island state and the UK and Dutch authorities.

The Reykjavik parliament approved the payment of £2.3 billion of taxpayers' money to Britain and £1.2 billion to the Netherlands to compensate for funds their governments paid out to about 340,000 investors in the Icesave internet bank.

But president Olafur Grimsson triggered the national poll by refusing to sign the so-called Icesave bill in January.

President Grimsson said it was "the pressure derived from the power of the people of Iceland" in calling a referendum which forced Britain and the Netherlands back to the negotiating table over the past few weeks to seek a more "balanced" agreement.

Britain and the Netherlands last week offered better terms -- including a floating interest rate on the debt plus 2.75%, which represents a significant cut on the 5.5% under the original deal hammered out at the end of last year.

But Iceland walked out on talks in London, turning down what the UK described as its "best and final offer".

Mr Grimsson told BBC Radio 4's Today programme: "What is important following this referendum and in the light of the outcome is that the leadership of Britain and the Netherlands, especially Gordon Brown, will now take the matter into his own hands, which he has not done.

"He (should) show, in the light of the progress which has been made recently, a similar type of statesmanship as he did a year ago on the global financial crisis.

"All the political parties in Iceland and the overwhelming majority of the people have said they will accept a fair deal. If a new agreement is fair, I don't think there will be a need for a (second) referendum."

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