Prime Minister's Address to the Nation on 17 June 2010
Friends and countrymen, near and far
Today, on this beautiful summer's day, we celebrate our national holiday all across the country. We celebrate our independence and our joy at living our lives in this country, on our bountiful island.
The natural beauty, the streams and rivers, the hot springs, the fish, water and fertile soil are resources that are becoming more precious with every year that passes. It is on these gifts of nature that we Icelanders base our existence and our economy. It is our common responsibility to protect these resources for the enjoyment of later generations.
In the difficulties that we have been going through in recent months and years, we have repeatedly been reminded that our judicious use of these resources is not something that we can take for granted. Enormous interests are at stake, which are not necessarily incompatible: the interests of harvesting and protecting; private interests and public interests; short-term interests and long-term interests. In times of hardship it is not surprising that the conflicts over these major interests should grow in intensity – but in such conditions it is even more important to bear in mind the significance of these resources for the nation as a whole. They belong to the nation as a whole, and it is with this in mind that we need to manage them, using them to meet our needs while protecting them at the same time.
In the course of this year we have been acutely reminded of the existence of the natural forces that created this land. This time, these forces made their impact felt not only in Iceland but also on international communications, affecting people all around the world. But the natural forces that were released came not only from the bowels of the earth, but from the spirit of our nation. On this day of celebration, the images that dominate my thoughts are of the power of solidarity shown by our countrymen when the volcanoes on Fimmvörðuháls and Eyjafjallajökull were aroused from their slumber.
With their response, the people of Iceland showed yet again their mettle. All our best characteristics and qualities came to the surface in these demanding conditions: Everyone who was involved, and all the people who were affected, showed solidarity, professionalism, courage, resourcefulness and self-sacrifice. These are precious characteristics; they are characteristics that we should foster and apply in all our tasks in the service of our community.
Friends and countrymen.
The volcanic eruptions reminded us of the importance of unity in our own country, but we were also reminded that we are part of an international community. News from Iceland dominated the world press and the general public in many parts of the world had their eyes on us from day to day. The press coverage of our country immediately impacted the flow of visitors to Iceland, and our important and growing tourist sector suddenly stood face to face with a totally unexpected situation.
Instead of admitting defeat, the tourist service companies, interest groups, the government and the public joined forces, and by a huge collective effort a collapse was averted and the tide was turned. It is our hope that in the longer term all of this coverage could even make Iceland a still more attractive option for travellers than before.
We have been successful here in Iceland in creating a good existence for ourselves in the face of catastrophes, hard times and natural disasters, and I am convinced that we will also battle through our current economic difficulties with the force of our combined efforts, perseverance and fortitude. The international community has certainly taken note of our combined determination to welcome visitors, and it has also been noted how, in an incredibly short time, we are succeeding in finding a way forward following an economic disaster which has few, if any, precedents in western history.
On Independence Day a year ago I said that the struggle with our economic problems was a struggle for economic independence. I said that our economic position meant that our nation was in fact waging a new struggle for independence. The challenges that remain are still countless and complex, but the steps we have taken forward in the past year have been many and substantial. It is probably not inaccurate to say that other nations are now getting started on a track that we Icelanders have already travelled a long way; examples are Germany and the United Kingdom, which recently announced extensive cutbacks in government spending and austere economic budgets.
Together, we have managed to secure peace in the labour market, we have kept the industries going and defended our welfare system to the extent that we possibly could. We have managed to rebuild the financial system and provided it with a sound financial and legal foundation. The reorganisation of large socially important enterprises has begun.
We have succeeded in strengthening our currency reserves, and averting the danger of national insolvency. We have managed to get our government finances under control, the government deficit is far short of earlier projections and we are confidently headed in the direction of sustainability in government expenditures in line with our budget. The króna has gained some ten percent in strength from the turn of the year, and inflation has been significantly reduced. When this government took office, inflation was 18.6%, as compared to 7.5% today, the lowest figure in some two years. At the same time, interest rates have dropped by half and are lower now than they have been for over five years.
GDP has exceeded projections, the recession is less than projected, and economic growth is more positive than anticipated. It is even anticipated that the economy could start to grow again later this year and reach 2-3% next year. There are therefore numerous positive signs.
But even though we can take satisfaction from the positive results achieved over this year, we must not lose sight of the great difficulties and pain that this economic disaster has caused. Most of the households in the country are struggling with the consequences of the collapse in one way or another, and many households are now dealing with extremely difficult financial conditions.
Our community must surely rest on the fundamental premise of helping those who are in need in these circumstances. In my earlier work, I got to know families who struggled with difficult conditions, and it is painful to witness, especially when the conditions affect children and adolescents. Numerous and various arrangements have been put in place to assist these families, and we will spare no effort to increase the number and variety of arrangements available and to modify them so as to make them a viable option for as many people as possible. Nevertheless, in the long term the recourses that will really improve living conditions for families are employment and a healthy economic environment.
The positive economic development that I outlined earlier will strengthen the economy and enable greater efforts to combat unemployment, which now stands at over eight percent. This figure has been falling over the past two months, and it never reached the heights anticipated in economic forecasts. Nevertheless, we cannot and will not accept any permanence of this level of unemployment in this country. We must use every means possible to prevent unemployment from becoming rooted in this country and to ensure the creation of valuable jobs across the country.
Friends and countrymen.
Over that past two weeks, and today on 17 June, students are graduating from educational institutions across the country. Students from primary schools and high schools, colleges and universities have been pouring out into the summer with their grades in hand. Most have done well, many have excelled, while some could have done better and must now renew their efforts.
Those of us who are engaged in politics receive our grades in the form of results of democratic elections. The recent local elections were in many ways a historic event. It is vital for us, the politicians and political movements in this country, to understand the message delivered to us by the public, especially with their extensive support for new candidates and movements. Our grades in the future will, in my opinion, be determined primarily by the way in which we, the elected representatives and political movements, manage to work our way through our current position.
I therefore welcome the reinforcements that have joined the ranks of politicians in local communities across the country and I trust that the new trends and new people will improve our politics and our democratic process.
We can agree with those who say that politics have become stuck in the rut of habit, and I do not exclude any political party from that judgment. We need to adopt new working methods and a new form of dialogue, both in the Althingi and in local government.
The extensive Report of the Special Investigation Commission of the Althing has now been made public, and the general consensus is that the Commission's work was extremely thorough. The process of responding to the conclusions of the Report has now started in the government, the Althing, the judicial system and other areas; this work is just beginning. In the coming months and years it will be extremely important that we succeed in analysing and acting on the recommendations and details in the Report and to learn real and concrete lessons from the mistakes that were made.
I attach great hopes to the constitutional convention for which elections will be held this year, as decided by the Althing. I believe that this is one of the most important issues ever addressed by the Althing, and I believe that its adoption represented a large step forward for democracy. The constitutional convention will have the important and complex task of preparing a proposal for a new constitution for Iceland; it will be the first constitution created from scratch for our nation.
The constitutional convention will be a remarkable gathering with the participation of the public at various stages; its creation will involve the use of procedures which I would like to see us implement in other fields as well. Over the period leading up to the constitutional convention it will be important to launch an extensive and dynamic discourse on the fundamental laws of our nation, independent of the interests of traditional political parties.
A national assembly of 1000 people will be gathered for this purpose, and personal elections will be held among the entire nation to decide on the scores of individuals who will be entrusted with the weighty task of drawing up a new constitution. The nation itself will then have the last word on the new constitution in a referendum on the proposals drawn up by the constitutional convention. It is my sincere hope that the new constitution will address various fundamental questions and issues that we have been unable to resolve in the past. In many respects, this could mark the start of a new chapter in the politics and government structure of the country.
Friends and countrymen.
We Icelanders have a remarkable history, particularly if we look at the period of our struggle for independence and our development as a democracy. Next year we will celebrate the bicentennial anniversary of the birth of Jón Sigurdsson from Hrafnseyri in Arnarfjördur, one of our foremost campaigners for Icelandic independence. This occasion will be celebrated in numerous ways, with opportunities for both young and old to examine and savour this episode in our nation's history. Jón Sigurdsson was a broad-minded and progressive person. At the same time that he defended Iceland and Icelanders and our national independence, he realised the importance and significance of relations with other nations.
Now, as in that earlier time, I believe it is beyond any doubt that Iceland's sovereignty and independence will best be secured by active participation in co-operation with other independent and sovereign nations. Those who seek co-operation with others will gain in strength and achieve their objectives.
Friends and countrymen.
Today we celebrate Independence Day, and our families and friends across the country come together to share a pleasant occasion. There is every reason to look to the future with optimism on this 17th of June 2010. We have endured dire straits. We are doing well, and we are turning the corner.
We rejoice in the bright days and nature's bounty and the joy that the Icelandic summer brings to all our hearts. I can see in my mind's eye the image of Ólafur, the Farmer at Thorvaldseyri at the roots of Eyjafjöll, as he ran the newly mown grass from his land through his hands. We saw a man who for a time was daunted by the ravaging forces of the elements, but reaped on that day the reward of his labour, a crop that surpassed all his hopes. In my mind this good farmer is a symbol of Icelanders, who have overcome ravages, overcome natural forces and overcome temporary adversity. The farmer at Thorvaldseyri is a hero in my eyes, like so many other Icelanders who have shown their fortitude in dealing with the consequences of the economic disaster that engulfed us.
To you I say today: We are on the right path. We will overcome these difficulties.
I wish you all a happy Independence Day.