Brussels - The European Commission said Monday it was
considering lending a 'small' amount of money to cash-strapped
Iceland, but only after its government resolved its disputes with
European Union member states such as Britain.
'The commission plans to propose to the member states and the
European Parliament macro financial assistance in the form of
loans, supplementing a program by the International Monetary Fund
(IMF),' said Johannes Laitenberger, spokesman for the EU executive in
Brussels.
'However, this can only be done after Iceland and some EU member
states reach an agreement on bilateral issues related to the deposit
guarantee scheme and the protection of foreign depositors,'
Laitenberger said.
Moreover, because of the commission's limited resources in the
light of possible additional requests from other non-EU member
states, the commission's assistance would be 'small,' the spokesman
said, without disclosing the exact amount.
'It should be seen more as a political gesture,' Laitenberger
said.
The move follows a formal request to Brussels by the government of
Iceland, which has been struggling to cope with the global credit
crunch.
Iceland is hoping to obtain 2.1 billion dollars from the IMF and
is seeking an additional 4 billion dollars from Scandinavian and
European countries including Britain and the Netherlands to counter a
recession.
Last month, Britain froze Icelandic bank assets in its territory
because of a dispute over bank deposit guarantees.
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