Iceland and the European Union

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The relationship between Iceland and the European Union is currently defined through Iceland's membership of the European Economic Area (EEA), which allows the country access to the single market of the European Union (EU).

[edit] Background

Iceland has never applied for EU membership. Iceland is, however, a member of the European Free Trade Association (EFTA), along with Norway, Switzerland and Liechtenstein. In 1994, Iceland and its EFTA partners—except for Switzerland, which rejected the Agreement in a referendum—signed the EEA-Agreement with the EU, which was designed to allow the EFTA countries to participate in the European single market without having to join the EU. The EFTA Secretariat in Brussels reported in 2005 that Iceland had adopted approximately 6.5% of EU regulations as a result of signing the EEA agreement.^[1]

From 1995 to 2007 the government coalition of the conservative Independence Party (Sjálfstæðisflokkurinn) and the liberal Progressive Party (Framsóknarflokkurinn), opposed joining the EU, while the opposition Social Democratic Alliance (Samfylkingin) supported membership negotiations.

Following the 2007 election, the Independence Party and the Social Democratic Alliance formed a new coalition with a policy of not applying for membership, but setting up a special committee to monitor the development within the EU and suggest ways to respond to that.^[2]

The 2009 elections, which followed the Icelandic financial crisis, saw the Progressive Party switch to supporting EU membership but the Independence Party called for a referendum prior to the start of negotiations. ^{[3] [4][5]} The Social Democratic Alliance made joining the EU a key issue in their campaign. ^[6]

Former Prime Minister Halldór Ásgrímsson, seems to be in favour of joining the EU, and predicted on 8 February 2006 that the country will join the EU by 2015. He added that the decisive factor will be the future and the size of the Eurozone, especially whether Denmark, Sweden and the UK have joined the euro or not.^[7] His prediction, however, did not receive much support in Iceland; it received much criticism, not the least from people within his own government.^[8]

The former Prime Minister, Geir H. Haarde, has on a number of occasions stated his opposition to EU membership, both as Foreign Minister under Halldór Ásgrímsson and after taking office as Prime Minister. In response to Halldór Ásgrímsson's earlier prediction, Haarde said, "I don't share that point of view. Our policy is not to join in the foreseeable future. We are not even exploring membership." In a speech at a conference at the University of Iceland on 31 March 2006, Geir Haarde repeated what he had said on a number of occasions—that no special Icelandic interests demanded membership of the EU. In the same speech he further explained in detail why it would not be in the interest of Iceland to adopt the euro.^[9]

At a meeting with members of his party on 17 May 2008, Geir Haarde said he believed the cost of joining the EU simply outweighed the benefits to his opinion and therefore he was not in favour of membership.^[10]

However, in October 2008, during talks to repatriate a portion of Iceland's foreign invested pension funds—Iceland having been particularly hard hit by the Liquidity crisis of September 2008—the unions demanded that Iceland apply for EU membership in return for wage restraint.^[11] On 30 October 2008, Þorgerður Katrín Gunnarsdóttir, minister of education said that "Iceland has to define its long-term national interests and part of that is a revision of the currency regime, including a possible EU application" and that application for membership needed to be discussed “in weeks rather than months”.^[12] A few days later, on 17 November 2008, the Independence Party announced it would hold its party congress in January 2009 instead of autumn 2009, to reconsider the possibility of applying for EU membership; the Progressive Party also announced it would hold its party congress early, after two anti-EU MPs (including the party leader) resigned and were replaced by pro-EU MPs.^[13] Already, four important party figures, Þorgerður Katrín Gunnarsdóttir, Árni Mathiesen, Illugi Gunnarsson and Bjarni Benediktsson, have said they are seriously looking into the idea of Iceland joining the EU.^[14][15][16]

On the 30th of January, 2009, EU Enlargement Commissioner Olli Rehn stated he thought Iceland could join at the same time as Croatia, which is expected to join in 2011. He stated that Iceland would have to apply soon, and a referendum is expected to be announced by the new centre-left government, though the whole process could be much faster than previous enlargements, largely because, as a member of the EEA, Iceland has already implemented about two-thirds of EU law.^[17]

Iceland's prime minister has announced the set-up of a commission to investigate joining the European Union. An initial plan has already been drafted by the country's foreign ministry that would see a membership application made in early 2009, aiming for entry some time in 2011.^[18][19]

Iceland's finance minister Steingrimur Sigfusson ahead of the country's first elections since its banking system collapsed last year has stated that "any decision for Iceland to join the European Union and the Single currency must be taken by its people not one political party", on the subject that the issue of EU membership was the greatest threat to a stable coalition.^[20]

After the win of the pro-EU Social Democratic Party in the 2009 election Prime Minister Jóhanna Sirgurðadóttir spoke of an immediate application to the European Union and adoption of the euro within four years as a way to deal with the country's debt. ^[21]

In late April 2009, it was announced that the United Kingdom, a member state of the European Union, with whom Iceland has had a long history of fishing and territorial water disputes supported Iceland joining the EU.^[22]

In early May 2009, it was leaked that the matter of applying for EU membership would likely be left to the parliament, where the Alliance, the Progressive Party and the Citizens' Movement alone already have enough seats to approve the application.^[23] Sigmundur Davíð Gunnlaugsson leader of the Progressive Party has however strongly objected to the idea that his party would aid the government in this matter. ^[24] The anti-EU Left-Green coalition partner has however accepted that in spring 2010, the minister for foreign affairs will present to the parliament a bill on talks with the EU. ^[25]

On May 10th, 2009, Prime Minister Jóhanna Sirgurðadóttir announced the government intended to move towards membership more quickly than previously expected. She announced a bill would be introduced before the parliament the following Friday, May the 15th, 2009, authorizing the opening of accession talks with the EU. She also stated she was confident the legislation would pass, saying the she had secured a parliamentary majority on the issue, despite the official opposition to talks from one of her coalition partners. She went on to say she expected an official application would be submitted no later than July 2009. This would seem to leave Iceland on course to join the EU along with Croatia in 2011, as predicted by EU Enlargement Commissioner, Olli Rehn. The government has stated the issue will be put to a vote once an accession agreement has been negotiated^[26].

The motion to file an application for membership was officially introduced in parliament on 25 May 2009.^[27][28]

Sweden, the next rotating presidency of the European Union starting in July 2009, announced that it would prioritize Iceland's EU accession process.^[29]

[edit] Political parties' stances towards membership

[edit] Public opinion

Various polls have been taken on public opinion regarding starting accession negotiations, joining the EU and joining the eurozone.

[edit] Membership process and progress

To become a member a country must first apply, then the country must be recognised as a candidate country. For that to happen the country must fulfill the first of Copenhagen criteria, that the country is a politically stable democracy that respects human rights.

Then a negotiation will take place, which will show the fulfilment of the economy criteria, and the amount of adoption of the EU legislation, and whether there shall be any exceptions.

EU Enlargement Commissioner Olli Rehn has claimed that negotiations on an accession treaty would take less than a year, because Iceland has already adopted two thirds of the EU legislation^[45] in relation to the EEA.^[46] He has on other occasions claimed that the negotiations could take up to 4 years. ^[47] EFTA has however pointed out that Iceland adopts only about 6.5% of EU legislation.^[48]

On January 30, 2009 Rehn commented that Iceland could enter the European Union promptly in 2011 at the same time as Croatia, saying Iceland is an old democracy but also that it should not get a special treatment. Fishing quotas and Icelandic whaling are expected to possibly be the toughest questions in negotiations if they took place.^[49]

[edit] Euro

Due to Iceland's limited currency, the government has explored the possibility of adopting the euro without joining the European Union. The EU, however, says that Iceland cannot join the Economic and Monetary Union (EMU) without becoming a full member state.^[50] Several small European countries have adopted the euro without joining the EU: Andorra, Monaco, San Marino, the Vatican City State, Montenegro and Kosovo. (Though the latter two have done so unilaterally without a formal agreement or endorsement from the ECB.)

[edit] See also

• Future enlargement of the European Union
• Norway and the European Union

[edit] References

[edit] External links

• European Commission > The EU's relations with Iceland
• Iceland's EU Debate (in Norwegian)
• (Icelandic) Heimssýn, the cross-political organisation of Icelandic eurosceptics
• Icelandic Pro-EU membership website (Icelandic)
• Icelandic Anti-EU Membership (Icelandic)

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