Prime Minister of Iceland from 1991 to 2004, and Foreign Minister from 2004 – 2005. He was also Chair of the Central Bank of Iceland’s Board of Governors from 2005 to 2009.
As Prime Minister he was the engine behind the experiment to make Iceland an example of free-market economics and in 2002 privatised the three state banks, Landsbanki, Kaupthing and Glitnir; he also floated the currency and fostered a golden age of entrepreneurship.
Under his chairmanship the Bank’s policies failed dismally, fueling economic hypertension, currency speculation and carry trade. The economy went into macroeconomic meltdown in 2008, when the Icelandic Banks had grown to twelve times the size of the economy defaulted. Through speculation they had stripped the Central Bank of its funds, so it was incapable of backing them up.
Instead the government had to come to the rescue, leaving the country’s debts amounting to 850% of GDP, so it had to be bailed out by the IMF with a loan of $2.1 bn. The collapse of the banking system led to demands for Oddsson’s resignation, so he was replaced as head of the Central Bank in March 2009.
In September 2009 he was hired as the editor of Morgunblaðið, one of Iceland’s largest newspapers, a very unpopular move, resulting in a dramatic drop in circulation. He contested the election for Icelandic President on 25 June 2016 but lost to Guðni Jóhannesson.