Photo of Prime Minister Geir H. Haarde (photos@pmo.is)http://hugin.info/139841/R/1263214/277247.jpg.Link to The IMFrelease: http://www.imf.org/external/pubs/ft/survey/so/2008/INT111908A.htm.

Reykjavik, Iceland - 19 November 2008 - The Executive Board of theInternational Monetary Fund (IMF) has approved Iceland's request fora two year stand-by arrangement.

Iceland will receive USD 2.1 bn. from the IMF. Additional loans of upto USD 3 bn. have been secured from Denmark, Finland, Norway, Sweden,Russia and Poland. The Faroe Islands have announced that they wouldlend Iceland USD 50 million.

Of the IMF loan, USD 827 million will be immediately available withthe remaining sum made over in eight equal installments of about USD155 million each, subject to quarterly reviews. The IMF program willlast two years and Iceland will repay the loan over the years2012-2015.

The funds made available through the IMF will be used to support thecurrency, the Icelandic krona, which will be floated as soon aspossible. It is to be expected that the currency market willstabilize soon and that international money transfers willsubsequently return to normal.

The Government of Iceland welcomes the action taken by the IMF, itsNordic neighbours, Russia, Poland and the Faroe Islands which it seesas a very positive step towards bringing financial stability after aperiod of uncertainty.

Prime Minister, Geir H. Haarde said:"We welcome the announcement made by the IMF today which I believe isan important step forward towards the rebuilding of our economy. Withthe IMF agreement in place, we can commence our recovery program withfull force and bring our economy back on track. I thank thosecountries who also contributed to the loan package. Our task now isto overcome the difficulties we face and to regain the trust and thestanding among other nations which we enjoyed before the impact ofthe global financial crisis struck Iceland".

Minister for Foreign Affairs, Ingibjörg Sólrún Gísladóttir said:"We appreciate the approval from the IMF and the trust in Icelandwhich it represents. The participation of the IMF in rebuilding theIcelandic economy is very important. It gives us a solid platform forre-establishing the credibility which will be necessary inrestructuring a viable Icelandic economy."

Additional press and media service:

To ensure transparency and satisfactory media service, a press officefunction has been established as part of the effort outlined above.The aim will be to ensure continued service to the domestic andinternational press. The mail address to the projects going forwardwill be: press@pmo.is for press photos: photos@pmo.is. For more factsand information from the Government, please visit www.government.is

Background on Prime Minister Geir H. Haarde

For more facts about Geir H. Haarde, please see:http://eng.forsaetisraduneyti.is/minister/cv

Background on Foreign Affairs Minister Ingibjörg Sólrún Gísladóttir

For more facts about Ingibjörg Sólrún Gísladóttir please see:http://www.mfa.is/minister/

Background about Iceland

For more background and facts about Iceland - please visitwww.government.is and www.icetourist.is/displayer.asp?cat_id=269. Forgeneral information about Iceland , please contact the IcelandChamber of Commerce, www.vi.is. The contact person is Finnur Oddson,Managing Director, e-mail: finnur@vi.is.

Iceland in short:

Iceland is an island of 103.000 km2 (39,756 sq.miles), with only313.000 inhabitants, is about one-third larger than Scotland orIreland. Its highest peak, Hvannadalshnjúkur, rises to 2.119 m andover 11 per cent of the country is covered by glaciers, includingVatnajökull, the largest in Europe. Energy: Situated on theMid-Atlantic Ridge, Iceland is a hot spot of volcanic and geothermalactivity: 30 post-glacial volcanoes have erupted in the past twocenturies, and natural hot water supplies much of the population withcheap, pollution-free heating. Rivers, too, are harnessed toprovide inexpensive hydroelectric power. People: Of the 313.000citizen, more than half live in the capital Reykjavík and itsneighbouring towns in the southwest. Keflavík International Airportis located about 50 km from the capital. Language: Iceland wassettled by Nordic people in the 9th century - tradition says that thefirst permanent settler was Ingólfur Arnarson, a Norwegian Viking whomade his home where Reykjavík now stands. The Icelanders stillspeak the language of the Vikings, although modern Icelandic hasundergone changes of pronunciation and, of course, of vocabulary!Iceland is alone in upholding another Norse tradition, i.e. thecustom of using patronymics rather than surnames; and Icelander'sChristian name is followed by his or her father's name and the suffix-son or -dóttir, e.g. Guðrún Pétursdóttir (Guðrún, daughter ofPétur). Members of a family can therefore have many different"surnames", which sometimes causes confusion to foreigners! History:In 930, the Icelandic settlers founded one of the world's firstrepublican governments; the Old Commonwealth Age, described in theclassic Icelandic Sagas, lasted until 1262, when Iceland lost itsindependence, and in 1944 the present republic was founded. Thecountry is governed by the Althing (parliament), whose 63 members areelected every four years. Four-yearly elections are also held forthe presidency; President Ólafur Ragnar Grímsson was elected in June1996 to succeed Vigdís Finnbogadóttir, and was re-elected in June2000. The head of state plays no part in day-to-day politics.Economy: Iceland has all the characteristics of a modern welfarestate. National income per capita was somewhat above the EU averagein 2007. Iceland has largely built on its comparative advantages inabundant marine and energy resources although the main driver ofeconomic growth recently has been services with two-thirds of theworking population employed in the service sector, both public andprivate. Fish and other marine products were the mainstay of anexport oriented economy until early 2008, when exports of aluminiumsmelting products emerged as the largest single export productaccounting for 40% of total export revenue. Export of services suchas tourism have also been growing and account for almost one-fifth oftotal export revenue. Iceland is a member of the European Free TradeAssociation (EFTA) and the European Economic Area (EEC). Health: Lifeexpectancy, at 81.3 years for women and 76.4 for men, is one of thehighest in the world, and a comprehensive state health-care systemaims to keep it that way.

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