Monday

17th Jun 2019

Iceland considers Canadian dollar instead of euro

  • Iceland might ditch the kroner for the Canadian dollar (Photo: Magnus Fröderberg / norden.org)

Iceland's Prime Minister Johanna Siguardardottir has said the tiny Nordic country faces a choice between using the Canadian dollar or the euro.

"The choice is between surrendering the sovereignty of Iceland in monetary policy by unilaterally adopting the currency of another country, or becoming a member of the EU," she said in a speech at the Social Democrat Alliance party convention on Saturday (10 March) in Reykjavik.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

A spokesman for the country's foreign ministry on Wednesday clarified that, for her part, EU membership is the best option.

Iceland is expected to hold a referendum on EU membership early next year, but the euro-crisis has shaken confidence in the Union as an economic safe haven.

For the opposition party which initially floated the idea last summer, the Canadian dollar could be more attractive than the single currency.

Polls say seven out of 10 Icelanders want to ditch the kroner. But the population is split between the euro and the Canadian dollar. Surveys also show that just 26 percent want to join the EU.

Canada's ambassador to Iceland, Alan Bones recently told its national broadcaster that Ottawa is "open to discussing the issue."

The banking crisis in 2008 crippled Iceland's economy and forced it to borrow €7.5 billion from the International Monetary Fund (IMF) and other lenders. It also wiped out people's savings and pensions. Its economy has since rebounded - the IMF projects 2.5 percent economic growth for 2012, while unemployment is down to 7 percent - but the banking drama is still being played out.

In early March, Iceland's former leader Geir Haarde was put on trial for "gross negligence" on the banking collapse.

Meanwhile, the UK and the Netherlands say the country still owes them €4 billion. Iceland in an earlier referendum rejected paying back the money, causing a rift with the two EU countries.

British Conservative MEP Marina Yannakoudakis in an EU parliament debate on Iceland in Strasbourg on Wednesday refused to back a resolution on Iceland's EU membership.

"The Icelandic government is dodging its legal obligation to pay minimum compensation to ... British depositors," she said.

This story was updated at 9.40am Brussels time to clarify that the PM supports EU accession

EU split on Western Balkans accession

Europe's credibility is at risk in the Western Balkans, half its member states have warned - but EU Commission president Jean-Claude Juncker said Albania and North Macedonia unlikely to start accession talks soon.

News in Brief

  1. Swiss stock exchange could lose EU access in July
  2. Austria's Strache will not take up EU parliament seat
  3. Tanker attacks pose questions for EU on Iran deal
  4. Johnson skips TV debate for UK prime ministership
  5. Slovakia's first female president takes office
  6. Irish immigration officers flew back business class
  7. Catalan MEP denied taking seat in European Parliament
  8. EU plans to restructure eurozone bonds

Opinion

EU report recognises Albania's achievements

Albania currently faces a serious crisis, which it would be foolish for all actors in the international community to ignore. Yet we must ask that our partners in Europe read Federica Mogherini's report carefully and recognise accomplishments.

Stakeholders' Highlights

  1. Nordic Council of MinistersNo evidence that social media are harmful to young people
  2. Nordic Council of MinistersCanada to host the joint Nordic cultural initiative 2021
  3. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  4. Nordic Council of MinistersEducation gets refugees into work
  5. Counter BalanceSign the petition to help reform the EU’s Bank
  6. UNICEFChild rights organisations encourage candidates for EU elections to become Child Rights Champions
  7. UNESDAUNESDA Outlines 2019-2024 Aspirations: Sustainability, Responsibility, Competitiveness
  8. Counter BalanceRecord citizens’ input to EU bank’s consultation calls on EIB to abandon fossil fuels
  9. International Partnership for Human RightsAnnual EU-Turkmenistan Human Rights Dialogue takes place in Ashgabat
  10. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North
  11. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  12. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody

Latest News

  1. Spain's Garcia set to be next Socialist leader in parliament
  2. Erdogan mocks Macron amid EU sanctions threat
  3. The most dangerous pesticide you've never heard of
  4. 'Russian sources' targeted EU elections with disinformation
  5. Top EU jobs summit dominates This WEEK
  6. EP parties planning 'coalition agenda' ahead of jobs summit
  7. MEP blasts Portugal over football whistleblower
  8. Catalonia MEPs are a judicial, not political, issue

Join EUobserver

Support quality EU news

Join us