Breaking News, World News and Taiwan News.

Updated Tuesday, March 9, 2010 10:34 am TWN, By Wojciech Moskwa, Reuters

Sponsors
▪	Buy china wholesale products from reliable chinese wholesalers on DHgate.com!
▪	Save 75% for all hotels in Shanghai, Beijing and whole China. Lowest rates for Flights in China.
▪	Get the best deals for Guangzhou Hotels or choose from more than 10,000 hotels in 499 Chinese cities.
▪	Find great real time deals on China Flights. Book flights to China or China domestic flights 24/7.

Referendum strengthens Iceland hand in debt talks

One sign of possible movement came from Britain on Sunday.

Britain's Finance Minister Alistair Darling said that he would be flexible in reaching a solution with Iceland, suggesting scope for a face-saving compromise for both sides.

But Sigurdardottir will need to show her government has won further compromise from Britain and the Netherlands if she is to win parliamentary approval for any new deal.

The opposition was dead-set against the old deal and feels vindicated by the referendum result. It is likely to exploit any perceived weakness in the government's negotiations, especially if support for Sigurdardottir continues to plummet.

The center-left government has flip-flopped on Icesave and its popularity has fallen in past months. Sigurdardottir has said the government will stay on, but if it fails to win a deal soon, its future is shaky.

Sigurdardottir has already angered Icelanders by declining to take part in the referendum, which some interpret as a sign that she is out of touch with ordinary people.

“Not voting in a referendum that is of the greatest importance to the future of the country ... shows a great rift between them (the government) and the nation,” said Olafur Isleifsson, an economics professor at Reykjavik University.

Foreign aid to Iceland's shattered economy remains on hold due to the Icesave row, which has dominated the political agenda for months, pushing issues such as soaring unemployment and a rising tide of mortgage defaults to the back burner.

“The message from the people is clear and the government must pay attention,” Finance Minister Steingrimur Sigfusson said after Saturday's referendum. “But as I have said before, Iceland can't wait any longer for the matter to stay unsolved.”

That impatience was echoed on the streets.

“The government is only concerned about Icesave and sort of forgotten about our problems. It has to solve this quickly and move on,” said Kristin Jonasdottir, an office worker.

1|2