Canadian ambassador stirs currency debate in Iceland

Mon Mar 5, 2012 8:22am EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

STOCKHOLM (Reuters) - Canada's ambassador to Iceland stirred up controversy over the future of the North Atlantic island's currency at the weekend, saying the nation of 320,000 would be welcome to start talks on adopting the Canadian dollar.

After Iceland's financial collapse in 2008, there has been much political discussion over whether to stick with the krona or adopt another currency to help bring stability to the economy.

Having already begun talks on joining the European Union, the country is widely expected to adopt the euro, although opposition to EU accession is growing.

Ambassador Alan Bones told Icelandic national broadcaster RUV on Friday that the Canadian government was willing to hold talks with Iceland on whether to adopt the loonie if Icelanders wanted to.

Bones had also been due to speak at a meeting of the Progressive Party, the country's second-biggest opposition group, on Saturday to address the issue again, but his speech was cancelled.

Canadian media reported that their government had cancelled the speech, while Iceland's foreign minister said Reykjavik had not objected to it.

"In fact, I'm all in favor of discussing the alternatives we may have to the krona," Foreign Minister Ossur Skarphedinsson told Icelandic radio.

Progressive Party leader Sigmundur Gunnlaugsson told daily Morgunbladid his party only wanted to promote debate on the topic.

"It's not like we are fighting for the adoption of the Canadian dollar. We are simply trying to generate a debate about the various possibilities Iceland has," he told the paper.   Continued...

A hologram security feature is seen on the new Canadian 100 dollar bill made of polymer in Toronto November 14, 2011. REUTERS/Mark Blinch