Smith Experience Abroad: 2011-12

Doing Business in the UK and Iceland: The Financial Meltdown

Spring one-credit BUSI788Q and Summer 1 term two-credit BUSI798Q

Cities London and Reykjavik
Faculty Dr. Colin Linsley
Dates Abroad Depart 18th May to arrive in London May 19th. Depart Reykjavik May 28th to arrive back US May 28th. Please do not purchase airfare until course is confirmed. Education Abroad requests that you purchase refundable fares; courses may be cancelled due to unexpected circumstances.
Mandatory BUSI788 pre-departure meetings Sun, April 15, 2012 from Noon - 6 p.m., Van Munching Hall - Room 1335
Sun, May 6, 2012 from 11 a.m. - 5 p.m., Van Munching Hall - Room 2509
How to Register Register on Testudo for BUSI788 section BA01 at the same time as your other courses. You will automatically be registered for the associated two-credit course abroad.

This class will examine how Iceland negotiated its 2008 financial meltdown, and look at the current relationship between the London creditors and the Icelandic government and population. The class will undertake a comparison between Iceland’s and Ireland’s approaches to similar crises.

Iceland disregarded international norms by refusing to pay back debt -- and enjoyed a pretty impressive recovery. Ireland negotiated with its fellow EU citizens and did not recover as well. However, Iceland’s refusal -- more than 93% of Icelanders voted to reject a deal to repay the U.K. and the Netherlands €3.9 billion ($5.3 billion) – disrupts its relationship with those creditor nations.

Iceland was the little country that could. An island of just 300,000 people, best known for its volcanic hot springs and fish, it became a financial powerhouse at the turn of the century. The corporate sector went on an acquisition spree, and the housing market boomed with cheap loans. Everyone seemed to be doing well as housing prices doubled, the strong krona encouraged Icelanders to shop in London, and Icelandic billionaires bought British retailers and football clubs.

In late 2008, all the island's major banks failed, including Landsbanki hf. Iceland's tiny deposit-insurance scheme couldn't pay the claims of British and Dutch, and the two governments stepped in to pay on Iceland’s behalf -- quickly asking for repayment. The payment of €3.9 billion was staggering, equivalent to nearly half of Iceland's entire economic output, and the government refused.

With the economy projected to grow 3 percent this year, Iceland’s decision to protect its population from shouldering the debt is looking smart -- and may prove to be a model for others..

PROGRAM NOTES:

Projected Cost: Each program has the following cost components:

$3,000 Program Fee: Includes shared hotel room; local transportation to business meetings, and required cultural activities; tickets or fees for required activities; some group meals; and professor and partner fees.

$4,275 Tuition Costs (3 credits): Each program is divided into a mandatory 1-credit (BUSI788) pre-departure course requiring 12 hours of pre-departure course work (usually held over 2 weekend-days) and a 2-credit 10-12 day study abroad immersion course(BUSI 798).

$250 Education Abroad Fee which goes directly to the campus office to maintain the emergency plan.

Personal expenses, international airfare, tourist visa application (if required), some meals and some inter-country transportation (if part of the program) should be added to calculate the total Projected Cost.

The schedule for adding and/or dropping this course adheres to UM’s schedule. For details, go to: www.testudo.umd.edu/soc/drops.html.

There will be a $500 penalty if the course is dropped after February 10, 2012.

DO NOT PURCHASE AIRFARE UNTIL COURSE IS CONFIRMED. Students are advised UM Education Abroad to purchase refundable airline tickets.