March 9, 2017 / 3:42 PM / a year ago

Iceland finmin says capital controls could be lifted in weeks or months

REYKJAVIK, March 9 (Reuters) - Icelandic Finance Minister Benedikt Johannesson said on Thursday the country’s capital controls could be lifted in weeks or months, news website Visir reported on Thursday.

Capital controls were imposed at the height of the financial crisis in 2008 to shore up a tumbling krona.

Asked in parliament about the centre-right government’s plan for scrapping the controls, Johannesson said:

“To answer it concretely, then it (the abolishment of the controls) could be in the next weeks or months,” he said.

On Tuesday, Johannesson said he hoped capital controls could be gone this year, echoing previous remarks by the central bank governor.

One hitch to removing capital controls has been an ongoing spat between Iceland and funds that own more than $1 billion worth of krona-denominated assets that were frozen by the Icelandic authorities.

The funds have waged a fight in Icelandic courts and at the European Free Trade Association’s Surveillance Authority to get a better rate than Iceland offered investors in an auction last year.

Earlier on Thursday, fresh data showed Iceland’s economy grew at the fastest clip since the financial crisis - by an annual 11 percent - in the fourth quarter last year.

Reporting by Ragnhildur Sigurdardottir; Editing by Simon Johnson and Alison Williams

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