Iceland. According to
Countryaah, the government's split became apparent when the
coalition in January decided to stop the negotiations for EU
membership until after the general elections in April. The
Social Democrats had pushed the issue of EU membership, but
the Left – Greens had slowed down throughout the reign.
At the same time, the government received a positive
message from Europe, when the EFTA court ruled in favor of
Iceland in the so-called Icesave conflict. According to the
court, Iceland did not breach the EEA agreement when the
Internet bank Icesave did not compensate British and Dutch
customers for losses in the bankruptcy of 2008.
The settlement after the bank collapses in 2008 continued
when the former bank executives were brought to trial in
March, for example. have manipulated stock prices. From
Landsbanki, a manager and five officials were prosecuted and
from Kaupthing a manager and eight officials. Earlier,
former Prime Minister Geir Haarde had been convicted of
negligence in the crisis, but without punishment.
The general election in April became a triumph for the
parties that ruled Iceland before the financial crisis. The
Conservative Independence Party and the Center Progressive
Party took about a quarter of the vote each and received
both 19 seats. In doing so, they achieved a clear majority
in the parliament and were able to form a coalition
The outgoing coalition with the Social Democrats and the
Left – the Greens made a disaster choice, after trying for
four years to clean up after Iceland's economic chaos in the
financial crisis. The voting share of both parties was
halved. The voters did not feel that they had received what
was promised, the debt was high and unemployment was
noticeable. Especially the rural population had felt the
austerity of the crisis, and outside the countryside the
government coalition lost a lot. At the same time, other
voters were upset that the memory was so short and that the
parties considered to have the greatest debt to the crisis
received such strong support.
The leader of the Progressive Party Sigmundur DavÝ
Gunnlaugsson became new prime minister with the Independence
Party leader Bjarni Benediktsson as finance minister. The
government decided in connection with its accession in May
to suspend Iceland's negotiations for EU membership for
good. When the negotiations were stopped at the beginning of
the year, one third of the negotiating chapters were ready,
and in an opinion poll 53% wanted the negotiations to be
completed. Later in the year, the government declared that
it did not intend to hold a referendum on the EU issue.
However, Iceland continues to be a member of EFTA and thus,
like Norway, has the so-called EEA agreement with the EU.
In June, the new government decided to resume commercial
whaling. The quota for catching herring during the year was
set at 154 whales. Also, fold selection was allowed for
During the year, the EU threatened Iceland with
sanctions, as Iceland unilaterally raised its catch quota of
mackerel. Iceland had then jumped from the negotiations on
catch quotas in the North-East Atlantic, since the EU and
Norway have taken 90% and offered Iceland 3.1%. The quota
that Iceland then set on its own accounted for about 16%.
During the year, the Norwegian state-owned company Petoro
AS signed an agreement with Iceland to drill for oil
northeast of Iceland, near the Norwegian island of Jan Mayen
but on the Icelandic seabed. The hopes for oil discoveries
were high, as the Arctic is estimated to have the largest
remaining oil resources on earth.
In December, four former executives at Kaupthing Bank
were sentenced to between three and five years in prison,
prosecuted for withholding important information during the
2008 financial crisis.