Icelanders lose jobs and spend less as their economy slides

SHOTLIST 1 Dec 2008 1. Musicians playing the blues in Reykjavik bar 2. Various of bar patrons listening to music and drinking beer 3. Various of musicians ++NIGHT SHOT 4. Exterior of bar ++DAY SHOTS+ 5. High shot over Reykjavik overlooked by snow-capped mountain 6. Various scenic shots of Reykjavik 29 Nov 2008 7. Various of people in main shopping street 8. People walk past shop advertising 40% and 70% discounts 30 Nov 2008 9. Exterior of Reykjavik flea market 10. Wide of stalls inside flea market 11. Shopper buying potatoes 12. Woman trying fermented shark's meat 13. Close up of pots of fermented shark 14. Packet of whale meat (Hrefnu-kjot) 15. People queue to buy food 16. Various of lady looking for coins coins to pay for food 17. Zoom out from packet of salted horse meat (Hrossakjot) 18. SOUNDBITE (English) Sigudur Gardarsson, food seller: "It has changed so that people buy less of this, which is expensive - this is dried fish - and more of my salted horse meat and other more inexpensive items." 2 Dec 2008 19. High wide of traffic in Reykjavik business district 20. Various exteriors of Landsbankinn and Kaupthing banks 21. Exterior of Kiwanishusid unemployment exchange 22. Sign stating opening hours of unemployment exchange 29 Nov 2008 23. SOUNDBITE (English) Geir Haarde, Icelandic Prime Minister: "We have gotten used to very high living standards. We have to adapt now to a drop in living standards that will take us back - let's say - five years." 2 Dec 2008 24. Half-finished office building where construction has been halted 25. Half-built concert hall where work has stopped 26. Arnar Thor Jonsson, architect facing redundancy, at home with his wife and young children 27. Various of Jonsson playing with children 28. SOUNDBITE (English) Arnar Thor Jonsson, architect: "When I lose my job, I don't know or how it's going to be, I don't know or what I'm going to face when it happens, I don't know." ++DUSK SHOTS++ 29. Close up of dark clouds above mountain peak at sunset 30. Wide of dark clouds over Reykjavik bay at sunset STORYLINE The people of Iceland have begun to tighten their belts following the spectacular collapse of their once-booming economy. In this tiny volcanic island just under the Arctic Circle, the economy has sunk further and faster than just about anywhere else in the western world. For the 320-thousand people who live here, it's all the more traumatic because Iceland once had one of the richest economies in Europe. But the boom was built on debt - and the bubble has well and truly burst. The global credit crunch brought down the country's three main banks in October. Since then businesses have failed, unemployment has risen, prices have shot up and the value of the country's currency, the krona, has plummeted. In the last couple of months, thousands of people have lost their jobs. The national currency, the krona, has lost two thirds of its value against the euro. The age of excess is over, and Icelanders are learning to live a simpler life. Money's too tight to mention in this Reykjavik bar. Every week a band comes in to play the blues. They've struck a chord with the local crowd. Their music matches the mood precisely. Iceland's capital city looks as beautiful as ever in the midst of winter, but the financial blues are all too evident among the smart stores that line the main shopping street. Prices are being slashed by as much as 70 per cent, but that's not always enough to tempt people through the doors. Instead, residents are rediscovering the bargain-basement benefits of the city's flea market. It's here that they buy traditional Icelandic specialities like fermented shark, whale and horse-meat. The construction industry has been floored. You can license this story through AP Archive: http://www.aparchive.com/metadata/youtube/52556d0d38d2c8c13e1a951bff07bc1c Find out more about AP Archive: http://www.aparchive.com/HowWeWork