Financial Times FT.com

Cash flow freeze blights Iceland

By Sarah O’Connor in Reykjavik

Published: October 15 2008 23:01 | Last updated: October 15 2008 23:01

The Icelandic economy was buckling on Wednesday as flows of money in and out of the country seized up, leaving importers struggling to pay suppliers and exporters deprived of payments.

HB Grandi, the biggest seafood company and a leading exporter, said its overseas customers’ money was frozen in foreign banks at a time when the economy was desperate for foreign currency in the wake of the krona’s collapse and the failure of the financial system.

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