Iceland's economic collapse is your gain
Oct 17th 2008 11:00AM
Updated Oct 17th 2008 12:05PM
What happened in Iceland isn't pretty. A month ago, it was one of Europe's richest countries: clean, efficient, thoroughly civilized, and living well. Then, suddenly, as international markets caved, it did, too. Life savings were wiped out in a flash, trading on the stock market was suspended to stem the bleeding, and the government moved to nationalize the banks, just eight years after they were privatized in a now-regrettable experiment.
Now Iceland is newly one of Europe's poorest countries. As one newspaper put it, Iceland is now "banging on the doors of Russia." A year ago, the American dollar bought only 60 krona. Today, it buys nearly twice as much, or 111. Costs have been halved. Now, after years of staying away because of scalding Scandinavian prices, Americans can tour Iceland for prices that are more in line with many of our own cities.
British tourists, who are just a couple of hours from the North Atlantic nation, are pouncing on the deals, which are already cost a third less than they did before the crash. Icelandair, which takes five or six hours to reach its country from several American cities (Orlando, Minneapolis, Boston, New York), is selling round-trip flights to Reykjavik, its clubby capital, for just $400 all winter, and another $150 buys a Hilton hotel stay for three nights while you're there (the booking deadline is Oct. 21, but I'd expect more deals to come).
The natural beauty of Iceland comes close to trumping New Zealand, which is greener but half the world away. But one of the things that kept tourists away from Iceland, not including the weather (yes, it's cold, but it's not Alaska bad), has been the cost of living there. Beers used to cost well over $13, a real impediment to a nightlife scene many think is among the best in Europe. No more. Day trips to the pristine glaciers that cost $200 a year ago can now be had for nearer to $100, which is reasonable by any measure.
Icelandair also has a long history of providing affordable onward flights to Northern Europe. You can fly to Reykjavik in a few hours (it's five from Boston), stop for a dip in the steamy mineral waters of the Blue Lagoon complex near the airport, maybe spend a few days soaking up the natural beauty, and then continue on to London, Paris, or Frankfurt. Often, that break will end up costing less (and hurting worse) than a non-stop flight straight to continental Europe, and you get to try a new place while you're at it.
The volcanic mound of Iceland is nearly bereft of trees, but it's blessed with some of the most gorgeous, unspoiled land that the Earth offers, and I don't know anyone who has visited (including myself) who didn't come away adoring it.
The crash is bad, but it's not like they're scraping around for worms and eating out of dumpsters, and random street crime is not part of the local vocabulary. Iceland, a longtime American ally, is still astoundingly literate and completely in step with our mainstream cultural trends. Although its virtually empty of people (just 320,000), it's still packed with some of the most glorious natural beauty ever crammed into a tiny place. Its geysers still spout without regard to the crisis, its glaciers still creep forward, and its tap water still tastes as clean and as pure as bottled mineral water.
When Argentina's system cratered in 2001, many Americans were finally convinced to travel there and enjoy the favorable exchange. Some observers likened the new visitors to vultures swooping in on a corpse, but few could argue that the local economy benefited from the infusion of foreign cash, particularly since it was being spent by tourists who otherwise would probably not have visited at all. Argentina's tourism profile was boosted immeasurably.
This economy is presenting vacationers with precious few advantages. Consider this a rare opportunity.