Report: Iceland and the European Union

by Hjörtur J. Guðmundsson

Introduction
Iceland has never applied for membership of the European Union. The debate has so far never gone further than just debating the issue. Iceland’s relations with the EU are mainly based on the EEA Agreement between the EU and the EFTA (which Iceland is a member of along with Norway, Liechtenstein and Switzerland. The last country is, however, not a members of the EEA ) which grants Iceland full access to the EU’s Single Market and at the same time obliges the country to adopt EU laws concerning it. Iceland is also a member of the Schengen borderless zone.

It is a widely used explanation that the fisheries are more or less the sole reason why Icelanders have choosen to stay out of the EU. The fisheries are surely extremely important to Iceland and the biggest pillar of its economy. However, the main reason is without doubt the independence and sovereignty. Which includes naturally the sovereignty over Iceland’s natural resources. The history of Iceland is regarded as a textbook example of how national independence and progress are entwined. How important it is for nations to be able to control their own destiny and be able to secure their own interests themselves.

The history
The public attitute towards EU membership has through the years been divided in two with almost as much support for either side according to opinion polls. At times the yes side has been few percents ahead and at others the no side has had an advance. On few limited occasions, however, either side has gained significantly more support. EU membership has never become an election issue in Iceland and as a rule increased debate on the issue has lead to increased opposition in opinion polls. In recent years only one political party represented in the Icelandic parliament, the Althing, has favoured membership negotiations with the EU.

For the past years there have been five political parties represended in the Althing:

• The Independence Party (Sjálfstæðisflokkurinn) – conservative/liberal/libertarian
• The Social Democratic Alliance (Samfylkingin) – social democrat
• The Left Green Movement (Vinstrihreyfingin – grænt framboð) – socialist/green
• The Progressive Party (Framsóknarflokkurinn) – centrist/liberal
• The Liberal Party (Frjálslyndi flokkurinn) – social liberal

The Independence Party was founded in 1929 through the merger of two center-right parties and has always been opposed to membership of the EU and its forerunners. The party was along with the Social Democratic Party (today a part of the Social Democratic Alliance) mainly responsible for Iceland’s membership of the EEA Agreement. The Independence Party has traditionally been Iceland’s biggest party gaining from 35-40 percent of the votes. In the last general elections in 2007 it got 37 percent. However, the party has been widely blamed for the banking collapse due to the fact until January it had been in government constantly since 1991. As a result according to the last poll by Gallup on April 2 the party has 25 percent.

The Social Democratic Alliance was founded in 2000 through the merger of four older left of center political parties. It has since 2002 been in favour of EU membership negotiations after a postal vote was conducted among party members. The party has received around 30 percent in general elections. In the elections in 2007 it got 27 percent. According to the last poll it has 29 percent.

The Left Green Movement was founded in 1999 and has from the beginning been opposed to EU membership. The party was founded by people who for ideological reasons opposed the idea of merging the whole Icelandic center-left into one single party which later became the Social Democratic Alliance. The Left Green Movement has received around 10 percent in general elections. In the elections in 2007, however, it got 14 percent. According to the last poll it has 28 percent.

The Progressive Party was founded in 1916 and is thus Iceland’s oldest political party still in existence. It was originally founded as a agrarian party but as increasing number of people moved from the countryside to towns and villages during the 20th century the party redefined itself as a centrist party while still holding strong ties with the countryside. The party was opposed to EU membership but in later years its policy has become one of observing the issue mainly as an attempt to reconcile different opinions among its members. The Progressive Party has traditionally had around 15-20 percent of the votes in general elections. In the elections in 2007 the party got 12 percent. According to the latest poll it has 11 percent.

The Liberal Party was founded in 1998 mainly to oppose the Icelandic fishing system which the party sees as unjustful. The party has always rejected EU membership mainly on the grounds of opposition to the Common Fisheries Policy. The Liberal Party has been the smallest of the five parties represented in the parliament in recent years. It has received around 5-10 percent in general elections. In the elections in 2007 the party got 7 percent. According to the latest poll it has about 1.5 percent.

Recent events
In the wake of the collapse of almost all the Icelandic banking sector in October 2008 a public panic emerged which among other things revealed itself in increased support for EU membership according to polls. There was a certain demand for a safe harbour and the yes side systematically portraited the EU as being one. There was also a certain panic among the politicians with some of them, who previously had opposed EU membership, starting to say that perhaps a referendum should be held on the issue. The leadership of the Independence Party decided in November to advance its national congress and hold it at the end of January 2009 among other things to review its position on EU membership.

This decision by the Independence Party’s leadership was widely seen as an attempt to pacify the then coalition partner in government the Social Democratic Alliance which had after the banks collapsed put an increased emphasis on EU membership and even threatened to break up the government if the Independence Party did not change its policy on the EU. The Independence Party’s leadership also formed a special committee within the party with the task of researching what EU membership would mean for Iceland and to provide a platform for the party’s members to voice their opinions. The committe held many meetings which showed clearly that vast majority of party members opposed EU membership.

However, before the Independence Party’s national congress could be held the Social Democratic Alliance left the government and formed a minority government with the Left Green Movement and with the support of the Progressive Party which will be in power until the election on April 25. As a result of this the leadership of the Independence Party decided to move the national congress to the end of March. In the beginning of the year 2009 the public attitute towards EU membership changed completely according to repeated polls with a majority opposed to EU membership.

Results of national congresses
The Independence Party eventually held its national congress on March 26-29. The party reaffirmed its previous policy that EU membership was not in the interests of the Icelandic people. The congress stated that a review of its postion towards EU membership had not led to a changed policy. The congress also stated that the issue should be put to a referendum if it would be addressed at some point in the future.

The Social Democratic Alliance held its national congres March 27-29. The party reaffirmed its previous policy that Iceland should apply for EU membership and start membership negotiations. The party leadership said it would put special emphasis on EU membership, both during the elections campaign and if the party will participate in forming a new government after the elections.

The Left Green Movement held its national congress March 20-22 where its previous opposition to EU membership was confirmed. The party also stated that if the issue would be addressed at any time in the future it should be put to a referendum.

The Progressive Party held its national congress in mid January accepting a changed policy towards EU membership. The party is now in favour of starting membership negotiations with the EU. However, the congress also agreed on certain strict conditions to be fulfilled for the party to support membership. Among them full authority over Icelandic natural resources including the fishing resource. A new chairman was also elected at the congress who has said that negotiations with the EU are not relevant until after the Icelandic economy has recovered. Addressing the issue while the economy is in tough times is simply not sensible.

The Liberal Party held its national congress on March 13-14 where its previous policy opposed to EU membership was confirmed. The party had conducted a mail vote among party members in December 2008 asking if Iceland should seek EU membership or not resulting in 52 percent against and 35 percent in favour.

Conclusion
The campaign before the general elections on April 25 will for obvious reasons be very short. At this point nothing indicates EU membership will be an issue now more than in previous general elections in Iceland. The short campaigning will probably constribute additionally to this since others issues are likely, as before, to be seen as much more important to address. However, the Social Democratic Alliance has as mentioned before claimed it will put special emphasis on EU membership, both during the elections campaign and if the party will participate in forming a new government after the elections. The problem the social democrats are facing is therefore with whom they are going to apply for EU membership?

Icelandic companies split over EU membership

The Confederation of Icelandic Employers, the umbrella organisation of all Icelandic companies, are split in two over the EU. The leadership of the CIE has been growing more and more EU oriented in the last weeks and months but ths CIE itself has never had any official policy towards the EU. Instead it has been left to the member organisations to form their own policy towards the issue. There have been very mixed opinions with the fisheries firmly opposed, the leadership of the industry very much in favour and everything there between. The leadership of the CIE has very much wanted to use it in favour of EU membership and therefore organised a special vote among all the companies which are members of its members organisations.

The vote was carried out November 24 - December 5. The results were that 43% want the CIE to promote EU membership while 40% do not support that move. 17% did not take a postion. Note that the size of the companies was taken into the picture, that is how much voting weigh it has inside the organisation it is a member of which is determined by its size. And notabene this is not a poll but a vote among all the member companies. The question put to them was this: "Does your company want the CIE to work towards an Icelandic membership of the EU and the adoption of euro as the currency of Iceland?" The possibilities were yes, no and does not take a position.

The results for the fisheries were extremely negative, 94-97% of companies in the fishery sector did not favour the CIE to work towards EU membership. At the same time it was very interesting that 41% of industry companies did not favour such move either while 52% did. The leadership of the industry has long been very pro-EU. But that organisation is obvioulsy also very split on the issue. Even during hard times like these. There has been some discussion lately in Iceland why these results have not been published before by the CIE. Obviously because this vote was supposed to give the CIE a reason to work towards EU membership but of course these results certainly will not.

No split in the Icelandic Independence Party or change in policy towards the EU

Some foreign media including the Financial Times have been suggesting that there is now a split in the conservative Independence Party (Sjálfstæðisflokkurinn) towards EU membership since its vice chairman and Minister of Education, Þorgerdur Katrin Gunnarsdottir, has said membership needed to be debated rather within weeks than months.

The fact is, however, that this is nothing new. Gunnarsdottir has aired these views before, like last spring, but did not get a very warm hug from the people in the party for doing that. After all the policy of the Independence Party is very clear in its opposition to EU membership. Gunnarsdottir is as a result as good as isolated in the party leadership with her views.

There are simply no signs of a split in the Independence Party over the EU or that its policy on the issue will be changed. The party is on the contrary as before firm in its opposition to EU membership.

Iceland Trade Minister has been pro-EU for many years

Some foreign media, including Bloomberg and AP, have recently reported that the Icelandic government may be changing its position towards membership of the European Union (EU) and then quoted either the Icelandic Minister of Trade, Bjorgvin G. Sigurdsson, or the Foreign Minister, Ingibjorg Solrun Gisladottir. The fact is, however, that both of them have favoured EU membership for many years and both of them represent the Socialdemocratic Alliance (Samfylkingin) which is as before the only political party in Iceland in favour of starting membership negotiations with the EU.

The social democrats are the junior coalition partner of the conservative Independence Party (Sjálfstæðisflokkurinn) in the Icelandic government. Prime Minister Geir Haarde earlier this week underlined that the policy of his government has not changed and is as before that EU membership is not on the agenda. The task ahead is to restore the Icelandic economy he said and the right time for a debate whether or not Iceland should apply for EU membership is not during the reconstruction.

Iceland PM: EU membership as before not on the agenda

At a press meeting on Tuesday October 27 in the Finnish capital of Helsinki Iceland's Prime Minister, Geir Haarde, underlined his government's policy that membership of the European Union is not on the agenda. The task ahead is to restore the Icelandic economy he said and the right time for a debate whether or not Iceland should apply for EU membership is not during the reconstruction.

No pro-EU protests in Iceland

Some foreign media have reported that a protest meeting, that took place in Reykjavik on last Saturday (October 25), had among other things called for Iceland to immediately begin membership negotiations with the European Union. No Icelandic media, however, reported that the protesters called for EU membership and the press release, which the leaders of the protests sent to the media prior to them, did not mention such a demand one word. According to the media and the press release the aim was to protest the economic situation. Also the protesters claimed that the government was not giving enough information to the public about what was going on. In other words the purpose of these protests were not to call for EU membership.

Iceland's Fisheries Minister still firm on his opposition to EU membership

Some foreign media, including the Euobserver.com and the Irish Times, claimed few days ago that the Icelandic Fisheries Minister, Einar K. Gudfinnsson, had changed his position towards membership of the European Union (EU) from being a firm opponent to saying it was one of the options that had to be looked into. This was claimed to be based on the reportings of Iceland's state radio (RUV).

The truth, however, is that Gudfinnsson never said he was open for EU membership. What he said was simply taken out of context in the foreign media. According to the website of RUV Gudfinnsson said all options regarding getting foreign loans had to be considered. In the news story it is then stressed that Gudfinnsson is as before firmly opposed to EU membership.

The title of RUV's news story is in fact "Ministers disagree on the EU" referring to the fact that Foreign Minister Ingibjorg Sólrun Gisladottir has for many years been in favour of EU membership while Gudfinnsson opposes it.

Gisladottir is chairman of the junior coalition parter in the Icelandic government. Her party, the Socialdemocratic Alliance (Samfylkingin), is the only political party in Iceland which favours EU membership negotiations. However, the senior coalition partner, the conservative Independence Party (Gudfinnsson's party), is opposed to EU membership.

The position of the Icelandic government has not changed since the banking crisis in Iceland started in the beginning of October. Its policy is as before that EU membership is not on the agenda.

Chances of a pro-EU government in Iceland keep decreasing

It seems as if a similar situation is developing in Iceland as in Norway. That is, we either can have a center-right government (The Independence Party and the Progressive Party) or a center-left government (The Social Democratic Alliance, the Left Green Movement and the Liberal Party). That the voters will be faced with only those two possibilities of government. Neither form will put EU membership on the agenda since the social democrats are the only party in favour of membership negotiations with the EU.

After the Progressive Party's national congress last weekend the chances decreased very much that the Social Democratic Alliance will be interested in forming a government with the party since the new leadership is more center-right than center-left and thus likely to seek continued cooperation with the Independence Party after the general elections in May next year. The new leadership is also more eurosceptic than the previous one.

The leadership of the Social Democratic Alliance now says that the party will focus on trying to form a center-left government with the Left Green Movement and the Liberal Party after the elections if the parties will get a majority in the parliament. That this will be its first choice. In any case the Independence Party, having the Prime Minister now, will have the first chance to form a government and will most likely look first to continued cooperation with the Progressive Party.

So chances of a pro-EU government in Iceland just keep decreasing, especially after Halldór Ásgrímsson left politics. He tried for years to raise the issue, both within his own party and outside it, but without any results. In his parting speech at the party's national congress he again stressed that Iceland should look more to the EU and called for a debate on whether Iceland should join the EU or not. Still the party accepted a resolution stating that the EEA Agreement is suiting Iceland fine and that everything suggests it will continue to do so in the years to come.

The pro-EUs in the party made no attempt this time, like at the previous national congress, to have the party accept a pro-EU policy. After all they had to retreat completely at the previous one. It is also very likely that that attempt was planned by Ásgrímsson himself although he obviously didin't want his involvement to be official.

EU membership question not on the agenda for years to come

A new chairman was elected at the Progressive Party's national congress this weekend. The new chairman, Jón Sigurðsson former Central Bank president and newly appointed Minister of Industry and Commerce, takes over from Halldór Ásgrímsson who decided this summer to retire from politics after more than three decades in the front line.

Sigurðsson said after the results were in that the question, whether Iceland should join the European Union or not, would not be on the agenda for years to come which marks a certain turn from the policies of the former chairman who has repeatedly called for a national debate on the issue.

Guðni Ágústsson, Minister of Agriculture and who rejects EU membership, was re-elected as vice chairman. Siv Friðleifsdóttir, Minister of Health who vied with Sigurðsson for the chairmanship, said there was no hurry discussing whether Iceland should join the EU or not. Jónína Bjartmarz, Minister of Social Affairs, said the future evolution of the EU was unclear and had to be monitored.

Sigurðsson furthermore announced at the congress his intention to put a special emphasis on promoting solidarity among party members, but no issue has created more rift in the party as the EU question. Huge opposition to EU memberhip exists within the party explaining the new chairman's decision to put the whole question on ice.

The congress' resolution on the EU states that the EEA Agreement secures Iceland's interests well and that everything suggests it will continue to do so in the forseeable future.

EU Membership Not Too Important For Social Democrats

The chairman of the Social Democratic Alliance (Samfylkingin), Ingibjörg Sólrún Gísladóttir, said in an interview with the Icelandic TV station NFS on Wednesday August 2 that the party was prepared to put its policy, that Iceland should enter membership negotiations with the European Union, aside in order to be able to participate in a coalition government after the next general election due in May next year (2007).

The Social Democratic Alliance is the only political party in Iceland which favours entering membership negotiations with the EU. All other parties reject the idea.