Bit cold for a banana republic WHEN Sigmundur David Gunnlaugsson was elected as Iceland’s youngest-ever prime minister in 2013, he rode to power on a wave of fury over the elite’s mismanagement of the financial system. Bad decisions had made the country exceptionally vulnerable to the global financial crisis; when it arrived in 2007-09, GDP fell by 9%. David Gunnlaugsson campaigned against foreign creditors and vowed to write off part of Icelanders’ mortgage debts. But after the publication by a journalistic consortium of the “Panama papers” (see article), popular anger was directed at the prime minister.
The leak revealed that in 2007 David Gunnlaugsson and his wife set up a company in the British Virgin Islands to hold proceeds from his wife’s inheritance, including bonds issued by three of Iceland’s banks (whose failure triggered the collapse). David Gunnlaugsson sold out to his wife for $ 1 in 2009, when he became an MP. But he never declared the existence of…
The Economist: Europe
