Dutch ask for explanation of Icesave move

The Netherlands has called on Iceland for an explanation following the country’s president’s refusal to sign a new legislation on the repayment of loans made following the collapse of online bank Icesave

President Olafur Ragnar Grimsson told a news conference on Tuesday he would not sign the bill paving the way for the repayment of €1.3bn to the Netherlands and €2.5bn to Britain. The two countries lent the money to Iceland so it could repay Icesave clients who lost their savings following the bankruptcy.
In a statement, finance minister Wouter Bos said he was very disappointed at the decision.
Economic developments
‘There has been a lot of work to refine the agreement over the past few weeks and the wishes of the Icelandic parliament and economic developments have been expressly taken into account,’ the statement said.
‘The lack of a solution for Icesave is unacceptable. The Netherlands will hold talks with Britain in the short term.’
Last week the Icelandic parliament voted narrowly in favour of the new legislation but a large majority of the population is opposed. They argue that they should not be held responsible for the failings of a financial institution operating under official supervision.
According to the Telegraaf, the presidential role is largely ceremonial and the president has only once previously refused to sign legislation in the past 65 years.

MPs angry
Dutch Labour MPs told the Telegraaf they are concerned the country will descend into political chaos. And Liberal MPs called on the government to take a tough line.
‘I am totally sick of this,’ said VVD MP Frans Weekers. ‘It is an untrustworthy country. We would appear to be good enough when they need money but not when it comes to paying it back.’
Weekers said the Netherlands should raise the issue at a European level and said free trade agreements with Iceland, which is not a member of the EU, should be stopped.
For the Financial Times timeline on the Icesave story, click here
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