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Vlad's Gone To Iceland
Not long ago Iceland was touted by the press as the 21st century's economic dream. The puffin-bothering northerners excelled at globalisation, buying up companies all over the world, but particularly in the UK. Two years on, and it's looking more like Zimbabwe than Eldorado: Icelandic banks are tanking and the currency is in desperate freefall. Icelanders, who are a great bunch it has to be said, are taking the downturn in good humour, admitting that "the party's over" and joking about returning to the island's previous fish-based economy.
It turns out that Iceland has gone to Mother Russia for help: Negotiations are underway to discuss a €4 billion loan from Russia, which is one of the world's most important holders of foreign currency reserves. Iceland insiders told The Spectator that the country's government had gone cap in hand to the EU, the US Federal Reserve and the Scandinavian countries for the loan, but all had refused them. So Russia stepped in where the west has feared to tread.
What's their price, though? Unlike many other bloggers on the right, EURSOC has nothing against Moscow and wishes Russia well, but we're no idiots and the Russians rarely do something for nothing. According to the Spectator, which is claiming this as an exclusive, in return Moscow might want to use the former US Naval Air Station at Keflavik Airport for refueling and maintaining its Atlantic air force.
As the Spectator notes, Iceland is a NATO member and so Russia couldn't use it as an actual base. But it would be quite a political coup for the Russians to start using the former US base. They have flown over it nearly twenty times since the US left, and it's a handy stopover for any Atlantic crossings Russia might need to make in future. Indeed, previous US administrations saw it as so important that the base was kept open for sixty-odd years after World War 2. The Americans' hasty exit from the base in 2006 is said to be the source of some resentment in Reykjavik.
So, while it's not a done deal, it's interesting. Icelandic bloggers, however, argue that going to the Russians could be a clever move: The prospect of Russians in Reykjavik might give the Americans second thoughts, and the west might after all step in as lender of last resort.
