Iceland Now Bankrupt Due to Globalization and Deregulation

In what has to be a cautionary tale about he arbitrary and capricious global market place and the price of failing to regulate, once prosperous and privatized Iceland does not have enough foreign exchange to import food for its people (it cannot grow its own).  It has also been branded a terrorist nation by the British for defaulting on its British bank loans.  Isn't "free trade" great for foreign countries?  Isn't "free market reform" a panacea?