Iceland turns to IMF for economic help
The country's prime minister, Geir Haarde, has said the country may need "several billion" more in assistance
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Saturday, 25, Oct 2008 11:13
Iceland is seeking the support of the International Monetary Fund (IMF) to help it stabilise its economy.
The northern European island state has also secured financing arrangements with other Scandinavian countries such as Norway, Sweden and Denmark.
Iceland's prime minister Geir Haarde said the IMF, the organisation tasked with maintaining global financial facility, had offered the country a $2 billion (£1.25 billion) loan, but added that the country would need much more assistance to ease the economic turmoil.
In an interview, he said: "With the $2 billion from IMF, that would be a good part of it, but I think we still need several billion in addition."
The country's currency, the krona, has fallen by over 50 per cent this year and its banking sector has collapsed requiring the nationalisation of three of the country's banks.
Local councils in the UK have close to £900 million in Icelandic banks and the UK government has frozen funds situated in the UK to ensure depositors do not lose their money.