Iceland

For a country long accustomed to navigating the cold North Atlantic on its own terms, Iceland now finds itself reconsidering a question that has divided its politics for more than a decade: whether its future lies closer to Brussels.

The government in Reykjavík is preparing legislation that would allow Icelanders to vote this autumn on whether to resume negotiations to join the European Union. According to the national broadcaster RÚV, ministers intend to submit the proposal to parliament in the coming days, with a referendum likely to take place in late September.

At first glance, the prospect of a referendum merely reopens a familiar debate. Iceland applied for EU membership in 2009, in the shadow of its catastrophic banking collapse, but accession talks were halted in 2013 and the application later withdrawn amid strong domestic resistance. Yet the fact that the issue has returned to the centre of national politics speaks volumes about the changing strategic landscape in Europe.

The push comes from the government led by Prime Minister Kristrún Frostadóttir, who has indicated that Icelanders should have the final say on whether negotiations with Brussels should resume. While the referendum would not itself constitute a vote on membership, it would determine whether the country should reopen accession talks abandoned more than a decade ago.

For years, the political arithmetic appeared settled. Iceland enjoys access to the EU’s single market through the European Economic Area, while retaining control over sensitive areas such as fisheries and agriculture. That compromise allowed successive governments to argue that the country enjoyed the best of both worlds: economic integration without surrendering sovereignty.

But the geopolitical winds have shifted.

Russia’s invasion of Ukraine has forced many European states to reassess their strategic alignments. For Iceland, a NATO member without a standing army, security considerations have once again become central to the debate about its place in Europe. At the same time, the volatility of global markets and a persistent rise in the cost of living have renewed questions about the stability of the Icelandic krona and the benefits that might accompany closer economic integration with the EU.

There is also a more unusual factor influencing the conversation. Recent remarks in Washington about the possibility of the United States acquiring Greenland — the vast Arctic territory belonging to Denmark — have sharpened Reykjavík’s awareness of its own strategic position in the North Atlantic. While such ideas may sound fanciful, they have nevertheless prompted Icelandic policymakers to think carefully about alliances and economic resilience.

Still, the obstacles that derailed Iceland’s earlier membership bid have hardly disappeared.

Fishing remains the most politically sensitive issue. The industry is not merely a pillar of the economy but an emblem of national sovereignty. Icelanders fought bitter “Cod Wars” with Britain in the 20th century to defend their control of the surrounding seas, and many voters remain wary of any arrangement that might dilute that authority under EU common fisheries policy.

Nor is public opinion decisively settled. Polling has swung repeatedly over the years, reflecting both economic conditions and the composition of governing coalitions. Surveys in recent years have suggested growing openness to EU membership, though scepticism remains entrenched among large segments of the electorate.

For Brussels, the prospect of renewed talks would carry symbolic importance. Enlargement has stalled in recent years, and while the focus has largely been on the Western Balkans and Ukraine, Iceland would represent a very different kind of candidate: a wealthy, stable democracy that already complies with much of the EU’s regulatory framework through its participation in the European Economic Area.

In practical terms, Iceland might be among the easiest countries ever to integrate into the bloc. Its institutions already mirror European standards, and many legislative chapters were opened during the earlier accession process before negotiations were suspended in 2013.

Yet ease of accession does not guarantee political enthusiasm. Icelandic voters have shown themselves willing to defy outside expectations before. The dramatic rejection of the Icesave bailout agreement in referendums following the financial crisis remains a vivid reminder that national sentiment can swiftly override international pressure.

The coming months will therefore revive a debate that touches on the core of Icelandic identity: whether the island nation should continue charting an independent economic course or anchor itself more firmly within the European project.

For now, the referendum proposal itself represents only the first step. Parliament must approve the measure before Icelanders can head to the polls. If lawmakers agree, voters may soon face a question that has lingered unresolved for more than a generation.

The answer will not simply determine whether negotiations with Brussels resume. It will signal how Iceland sees its place in a rapidly changing Europe — as a self-reliant outpost in the North Atlantic, or as a fully integrated member of the continental club.