A poll suggests 58% of Icelanders will reject Icesave bill in a referendum on 20^th Feb;

The Times reports that the Icelandic Govt proposes a bill for Iceland to reimburse £3.6b to UK and Dutch savers after the collapse of the Icesave bank. The Icelandic President refuses to sign it into law.

The Guardian reports that a new poll suggests 58% will vote against the bill, while 42% will vote in favour.

The WSJ notes that Iceland is not reneging on the principle of repayment, but objects to the terms of the state guarantee.

The loans are approx 40% of Iceland's projected 2009 GDP. Former Board Member of Iceland's Central Bank Hannes H. Gissurarson says: "The present upheaval will make EU membership less likely: The EU will be less eager to accept Iceland; and Icelanders, seeing the EU supporting the interests of the British and the Dutch against Iceland, will be more reluctant to join."

Iceland's Foreign Minister Össur Stropheöinsson warned the British and Dutch govts not to interfere in the legislative process, saying: "Despite the President's decision, which I deeply regret, it has to be remembered that he exercises his constitutional right".

On BBC Newsnight, Icelandic President Olafur Ragnar Grimsson said, "You have to trust the democratic process. In France, the Netherlands, Ireland, and many EU countries, referendums are a normal part of the democratic process. In Britain, you don't have the experience of trusting the people with a referendum but all over Europe the countries do trust the people with a referendum.

I thought the new Europe was not only about market reforms but also about democracy and the will of the people."

Larry Elliott in the Guardian, "Iceland's president is well aware of what he is doing. When the Swedes held a referendum over membership of the euro, the political elite said yes but the people said no. When the French and the Dutch passed judgment on the new European constitution, the elite was all in favour but the voters were not. It is the same story, first time round at least, when Ireland voted on the Lisbon treaty. Grimsson is gambling that a big no vote next month will lead to a softening of the agreement".

Stuart , St. Ives, Cornwal