Sunday

28th Aug 2016

EU bid causes tension in Iceland government

  • The euro zone crisis has caused concern among Iceland's Left Green party, which now questions the island-nation's bid to join the EU (Photo: European Commission)

Iceland's coalition government risks splitting up over how to handle the country's EU bid and the euro crisis.

Foreign minister Ossur Skarphedinsson, from the Social Democratic Alliance party, told national radio on Monday (13 August) that EU membership is integral to the left-wing coalition's platform.

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"We made an agreement, which the Social Democratic Alliance agreed to as well as the other government party. If the situation arises that the government parties feel they can't stick to that agreement, we of course have to totally re-evaluate the situation," he said, AFP reports.

The foreign minister in April presented his annual report on EU accession negotiations to parliament.

"When it comes to Iceland's interests we are all a part of the same team," he said at the time.

But for their part, some in Left Green party, who had always opposed joining the EU, want to reconsider their coalition deal on EU membership in the context of the euro storm.

The Left Green party agreed to EU accession talks but on condition that a referendum among the island's 320,000 people would determine the final say on membership.

Katrin Jakobsdottir, the minister of education, science and culture and a Left Green member, said that Europe’s political and economic problems have since generated a sense of uncertainty that can no longer be ignored.

"It is clear that this [financial] uncertainty has considerable affects on the [accession] process in Iceland," she said.

Formal negotiations on Iceland's EU membership started in July 2010.

EU enlargement commissioner Stefan Fuele at the time said Iceland's membership would bring it "economic and monetary stability and a voice at the EU decision-making table."

Iceland, which was one of the first causalities of the financial crisis in 2008, currently enjoys low unemployment and a trade surplus.

It exports some 59 percent of its GDP and had also allowed its banks to fail in the wake of the crisis. The next parliamentary elections will be held in 2013.

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