Iceland votes against savings repayment proposal

The Icelandic population has voted overwhelmingly against repaying £3.3 billion worth of loans to the UK and Netherlands.

In the country's first referendum as an independent nation, 93 per cent of voters called for the government to withhold payment while the country attempts to restore its own economic health.

Both the UK and the Netherlands are owed money after being forced to compensate savers when the online bank Icesave collapsed in 2008.

Steingrimur Sigfusson, the country's finance minister, said the no vote did not mean Iceland was refusing to meet its obligations.

"To maintain anything else is highly dangerous for the economy of this country," he stated.

However, Mr Sigfusson indicated that further discussions would be necessary in order for an agreement to be reached.

Iceland's prime minister Johanna Sigurdardottir, who negotiated the deal with England and the Netherlands, spoke out against the proposed repayment deal ahead of the referendum.

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2010-03-08 12:48:25 © Moneyextra.com