Iceland’s renewed EU ambitions: referendum on the horizon amid historical hurdles

On Wednesday Reuters reported that Iceland is set to hold a referendum in the coming months on whether to restart European Union (EU) accession talks, as announced by Prime Minister Kristrun Frostadottir.

This move stems from the centre-left coalition government, which assumed power following a snap election in 2024 and pledged to conduct the vote no later than 2027.

Frostadottir described the referendum as “opening an opportunity” for deeper European integration, amid growing public interest reflected in recent polls.

Factors driving this revival include escalating living costs, the ongoing war in Ukraine, and geopolitical tensions such as U.S. President Donald Trump’s repeated threats to annex Greenland, which have heightened Iceland’s sense of vulnerability.

Iceland already enjoys close ties with the EU through membership in the single market, the Schengen Area, the European Free Trade Association (EFTA), and NATO, but full membership could provide enhanced security and economic stability.

This announcement marks a potential revival of Iceland’s EU aspirations, which were abruptly halted over a decade ago. Iceland formally applied for EU membership on 16 July 2009, in the wake of the 2008 global financial crisis that devastated its economy, leading to a sharp devaluation of the Icelandic krona and prompting interest in eurozone stability.

The European Commission issued a favorable opinion in February 2010, and the Council granted candidate status in June 2010, with formal accession negotiations commencing on 27 July 2010.

Progress was initially swift: by the time talks were suspended, 27 of the 33 negotiation chapters had been opened, with 11 provisionally closed, covering areas like science, education, and financial control. This placed Iceland on a relatively fast track compared to other candidates, benefiting from its existing alignment with EU laws via the European Economic Area (EEA) agreement.

However, domestic politics shifted dramatically. Following parliamentary elections in April 2013, a new centre-right coalition government – comprising the Independence Party and the Progressive Party – took office and promptly suspended negotiations on 22 May 2013, citing the need for a public referendum before proceeding.

By September 2013, Iceland dissolved its EU accession team, effectively pausing the process. Public support for membership had waned amid economic recovery and concerns over sovereignty, particularly in key sectors.

In March 2015, Foreign Minister Gunnar Bragi Sveinsson sent a letter to the EU stating that Iceland should no longer be regarded as a candidate country, though this was done without parliamentary approval and the EU did not consider the application formally withdrawn – viewing it instead as indefinitely suspended.

The decision reflected broader euroscepticism, with polls showing divided opinions: support hovered around 45% in favor by 2025, influenced by historical debates dating back to the 1980s and 1990s.

If the upcoming referendum yields a positive result, restarting talks could leverage the prior progress, potentially resuming from the 2013 status.

Yet, significant challenges loom, especially in negotiating the fisheries chapter, which was never opened during the initial talks due to unresolved disputes. Fisheries are central to Iceland’s economy, accounting for 8-12% of GDP directly and up to 25% with indirect effects, representing about 39% of goods exports as of 2021.

The EU’s Common Fisheries Policy (CFP) mandates shared access to waters and centrally set quotas (Total Allowable Catches, or TACs) to conserve marine resources – an exclusive EU competence under Article 3 of the Treaty on the Functioning of the EU.

This clashes with Iceland’s insistence on sovereign control over its 200-nautical-mile Exclusive Economic Zone (EEZ), where it manages stocks independently and restricts foreign vessels from obtaining catch certificates, favouring domestic industry.

Historical frictions exacerbate this: the “mackerel wars” of the early 2010s saw Iceland unilaterally increase mackerel quotas by 45% beyond recommended levels, leading to EU sanctions threats and stalling the fisheries chapter.

Iceland’s whaling practices also conflict with EU conservation rules.

While opt-outs or transitional arrangements are legally possible with unanimous member state consent, political resistance from fishing-heavy EU nations like Spain, France, Ireland, and Denmark could prolong talks.

Caption: Iceland’s Prime Minister Kristrun Frostadottir addresses a joint press conference with Polish Prime Minister Donald Tusk (not pictured) following their meeting at the Chancellery of the Prime Minister in Warsaw, Poland, 25 February 2026. The Icelandic prime minister arrived in Poland following her visit to Kyiv, to discuss economic cooperation, as well as the current geopolitical situation in Europe and the strategic Arctic region. EPA/PAWEL SUPERNAK