, Columnist
Iceland's Rationale for Stiffing Bondholders Melts Away
One of the world's fastest-growing economies can easily pay its creditors, but chooses not to.
Time to pay up.
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After three months of stalemate, Iceland formed a new coalition government this week. Part of the three-party deal was a parliamentary vote on whether to hold a referendum on joining the European Union. But will the EU welcome a country that is gaining a reputation for reneging on its debts?
Nations with poor economies and bad governance often get into financial trouble and can’t meet their obligations. Recent examples include Greece, Jamaica and Ecuador. But Iceland may be unique in the annuals of borrowing -- a country that can easily pay its creditors but simply chooses not to.