VIENNA (Reuters) - Iceland's government might not survive a second referendum defeat over deals to repay debts to the Netherlands and Great Britain, Business Affairs Minister Gylfi Magnusson was quoted as saying on Monday.
Icelandic voters in March overwhelmingly rejected an accord on paying more than $5 billion to the two governments, which they felt was harsh and unfair. Since then, little progress has been made in talks to reach a new deal.
"We hope to find an agreement once the Netherlands has a new government," Magnusson told Austrian daily newspaper Der Standard in an interview.
"I hope there won't be another referendum. If voters refused (a debt deal) again, this would be bad news for our economy. I don't know if our government would survive that," he added.
Iceland's debts to the two European Union members arose after the Dutch and British governments compensated savers in their countries who lost Hmoney in collapsed Icelandic banks' online deposit accounts.
Icelandic President Olafur Ragnar Grimsson refused to sign the so-called Icesave bill into law, forcing a referendum.
(Reporting by Boris Groendahl, editing by Paul Taylor)
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