Iceland: crisis and regional development – Thanks for all the fish? created by Karl Benediktsson and Anna Karlsdóttir

In this commentary, the crisis that hit Iceland in late 2008 and involved the collapse of the country’s entire banking system is discussed briefly and its impact on regional employment levels is outlined. Currently, unemployment is highest in south-west Iceland, including Reykjavík. Fisheries-dependent communities have performed better, but fisheries management is yet again a major issue in the political arena. We trace the origins of the Individual Transferable Quota (ITQ) system and speculate about its role in the series of events that eventually led to the downfall of the banks. Ongoing attempts to reform the fisheries management system are discussed. These include the re-establishment of open-access coastal fishing and the gradual recall of ITQs by the state. Finally, some issues regarding the future of Iceland’s economy are discussed briefly.