Iceland votes ‘no’ over pay plan

ICELAND is heading for economic and political chaos, according to the country’s prime minister, after a plan to repay €3.45bn to Britain and the Netherlands was rejected for a second time.

After the “no” vote prevailed in Saturday’s referendum, the dispute will end up in a European court. Economists said the uncertainty is hurting efforts to drag Iceland out of recession, end currency controls and boost investment.

“The worst option was chosen. The vote has split the nation in two,” prime minister Johanna Sigurdardottir told Icelandic state television.