Further support measures for Grindavík announced

The proposals consist of support loans with government guarantee for small companies, resistance grants, continuation of wage support and raw material and product insurance. Special housing support for Grindvíking will also be extended until the end of the year.

Subsidized loan with government guarantee

Operators with a place of business in Grindavík will be enabled to take loans from credit institutions with the state's guarantee if certain conditions are met. The goal is to help viable companies in Grindavík to maintain operations in times of uncertainty.

Loans of this type have a precedent in support measures for companies during the COVID-19 epidemic. It is assumed that a company with an establishment in Grindavík has the option of a loan and that real estate is not a condition.

A bill on support loans will be prepared in the Ministry of Finance and Economy. The aim is for loans to start this fall.

Resistance bands

Temporary operational support for companies that had operations in Grindavík in November 2023 will be extended and valid until the end of the year. In any case, the remedy would have expired at the end of June. The support is intended to enable companies to adapt their operations to the changed conditions and start operations in Grindavík again when conditions permit.

It is expected that a bill on the extension of resistance grants will be submitted to Althingi in June.

Extension of wage support

Support for the payment of wages will be extended until August 31. but the remedy was to expire at the end of June. By extending the validity period by two months, employers and employees are given more flexibility, as it is expected that support loans will not be processed until this fall. About 1,700 people have been paid from the resource, but the vast majority of them work in the public labor market.

It is expected that a bill on the extension of wage support will be submitted to Althingi in June.

The Grindavík Product Fund will be created

The Ministry of Food is working on drafting a bill with the aim of establishing resources to insure raw materials and products of companies in Grindavík against damage due to natural hazards. The case is being worked on in cooperation with the Ministry of Finance and the Economy and Iceland's Natural Disaster Insurance.

It is expected that a bill on product insurance in Grindavík will be submitted to Althingi in June.

Extension of selective housing support

Specific housing support for Grindvíking will be extended until the end of the year. The remedy was established by Parliament's approval last December. but the goal is to reduce the housing costs of Grindvíkin, who have to rent housing outside the town. In any case, the support would have expired at the end of August.

It is expected that a bill on the extension of specific housing support will be submitted to Althingi in June.

The proposals concerning companies are based on the work of a working group on business life in Grindavík appointed by the Prime Minister last February. There were representatives of four ministries, but the group met with representatives of companies in Grindavík and worked closely with the business team of Grindavíkur town.

The working group commissioned Deloitte to prepare a report in which the infrastructure in Grindavík was mapped and different scenarios were drawn up for the development of business life in the town. The report also contains an economic analysis that addresses both the objective and subjective macroeconomic costs to the economy of various scenarios.

It can be assumed that the cost to the government of the actions that have already been undertaken and are planned is in the range of 70-80 billion ISK.

Cost and benefit analysis for infrastructure and business life in Grindavík - Deloitte report
Slides from the minister's presentation of the meeting on further support measures for Grindavík