Euro on prescription for Iceland

Kari Heimonen, professor of economics at the University of Jyväskylä, writes in a guest editorial for the daily Helsingin Sanomat that Iceland should introduce the euro in order to overcome the financial crisis. "The global financial crisis has hit the little island nation Iceland hardest. It is clear that it will not be able to survive this situation on its own. ... In principle Iceland could introduce the euro unilaterally without the approval of the ECB. ... Euros can be bought freely on international currency markets. A small economy does not need a huge volume of euros in cash. Prices would have to be given in euros instead of Icelandic krona and the euro would become legal tender. ... The euro would solve Iceland's currency problems. The Icelandic economy would then see encouraging growth."

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