Friday

21st Jul 2017

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.

Thank you for reading EUobserver!

Subscribe now and get 40% off for an annual subscription. Sale ends soon.

  1. €90 per year. Use discount code EUOBS40%
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

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

Juncker: Death penalty will end Turkey's EU bid

Turkish president Erdogan said he would reinstate capital punishment, for people behind last year's failed military coup. But European Commission president Juncker says the move would end Turkey's bid to join the EU.

Opinion

Overcoming the plot against Turkish democracy

One year after an attempted coup, what Turkey needs is not biased and groundless criticism but more cooperation, dialogue and understanding, writes its Europe minister Omer Celik.

News in Brief

  1. Polish parliament adopts controversial justice reform
  2. GMO opt-out plan unlikely to go anywhere in 2017
  3. Slovak PM threatens to boycott inferior food
  4. France takes Google's 'right to be forgotten' to EU court
  5. Turkey accuses German companies of supporting terror
  6. Israel's Netanyahu caught calling EU 'crazy'
  7. UK does not collect enough data to expel EU nationals
  8. Polish president threatens to veto justice reform

Stakeholders' Highlights

  1. European Jewish CongressJean-Marie Le Pen Faces Trial for Oven Comments About Jewish Singer
  2. ACCAAnnounces Belt & Road Research at Shanghai Conference
  3. ECPAFood waste in the field can double without crop protection. #WithOrWithout #pesticides
  4. EU2017EEEstonia Allocates €1 Million to Alleviate Migratory Pressure From Libya in Italy
  5. Dialogue PlatformFethullah Gulen's Message on the Anniversary of the Coup Attempt in Turkey
  6. Martens CentreWeeding out Fake News: An Approach to Social Media Regulation
  7. European Jewish CongressEJC Concerned by Normalisation of Antisemitic Tropes in Hungary
  8. Counter BalanceOut for Summer Episode 1: How the EIB Sweeps a Development Fiasco Under the Rug
  9. CESICESI to Participate in Sectoral Social Dialogue Committee on Postal Services
  10. ILGA-EuropeMalta Keeps on Rocking: Marriage Equality on Its Way
  11. European Friends of ArmeniaEuFoA Director and MEPs Comment on the Recent Conflict Escalation in Nagorno-Karabakh
  12. EU2017EEEstonian Presidency Kicks off Youth Programme With Coding Summer School

Latest News

  1. Dutch coalition talks lengthiest in 40 years
  2. Polish parliament steps up showdown with EU
  3. EU urges UK to clarify its Brexit positions
  4. Law expert: direct EU powers have become too complicated
  5. Winter is here for Spitzenkandidat, but he'll survive
  6. Mafia money pollutes the EU economy
  7. Central Europe should be wary of Brexit stopping
  8. Poland's 'July coup' and what it means for the judiciary