Iceland to join EU

[RedRalph]

From guardian

Iceland will be put on a fast track to joining the European Union to rescue the small Arctic state from financial collapse amid rising expectations that it will apply for membership within months, senior policy-makers in Brussels and Reykjavik have told the Guardian.


Ian Traynor on fast-tracking Iceland into the EU and the euro Link to this audio The European commission is preparing itself for a membership bid, depending on the outcome of a snap general election expected in May. An application would be viewed very favourably in Brussels and the negotiations, which normally take many years, would be fast-forwarded to make Iceland the EU's 29th member in record time, probably in 2011.

Olli Rehn, the European commissioner in charge of enlargement, said: "The EU prefers two countries joining at the same time rather than individually. If Iceland applies shortly and the negotiations are rapid, Croatia and Iceland could join the EU in parallel. On Iceland, I hope I will be busier. It is one of the oldest democracies in the world and its strategic and economic positions would be an asset to the EU."

Rehn's support for swift Icelandic membership was echoed by senior European diplomats in Brussels. "We would like to see Iceland join the EU," said one. The current and next holders of the EU presidency, the Czechs and then the Swedes, are also strong supporters of EU enlargement and will deploy their agenda-setting powers to help Iceland.

The conservative government in Reykjavik, in power for 18 years, collapsed this week, the first government to fall as a result of the financial meltdown which has wrecked the Icelandic currency, the krona, wiped out savings and pensions, required a massive IMF bailout, sparked unprecedented riots in Reykjavik, and forced the formation of a caretaker centre-left government until new elections can be held, probably on 9 May.

EU membership will be a central theme of the election campaign, with the social democrats - the senior partner in the coalition interim government with the anti-EU Left Greens - pushing to join the EU and to swap the krona for the single European currency as soon as possible.

"The krona is dead. We need a new currency. The only serious option is the euro," said a senior Icelandic official.

The financial disaster in Iceland has triggered extreme volatility among voters. While there is support for joining the euro as a currency safe haven to protect Iceland from a battering by the markets, there is less enthusiasm for full EU membership, particularly among those in the vital fishing sector. This factor has fuelled talk of "unilateral euroisation", meaning that Iceland might join or use the single currency without being admitted to the EU. This is dismissed in Brussels as nonsense.

Though deeply indebted and in dire straits, the Icelandic economy is minuscule compared with the main EU member states and therefore unlikely to prove a destabilising force. Iceland has already secured a multibillion pound IMF loan and is unlikely to prove a drain on the EU budget.

But joining the euro is a different question. Despite growing sentiment in Iceland that Brussels and the single currency might be the remedy to the worst crisis the country has seen, the road to the euro is likely to be fraught with problems because of the strict rules governing the eurozone under the Maastrict treaty. Although the economic and financial crisis has seen a loosening of the single currency rulebook, current Icelandic interest rates of 18% would pose big problems for mainstream single currency members.

Already Christian Democrats in the Netherlands, the party of the prime minister, are coupling their hostility with Turkey's membership of the EU to criticism of Iceland's ambitions. Such hostility might increase but senior figures in the European commission believe that Reykjavik brings more assets than liabilities to the EU.

 

[ArneHD]

If Iceland joins the EU, the knock-on effect might be that Norway joins as well. They did a study some time ago, and found that if Iceland joined, so would Norway.

 

[Richard Cribb]

What study are you referring to?

 

[AL_DA_GREAT]

NNNNNNNNNNNNNNNOOOOOOOOOOOOOOOOOOOOOOOOOOOOO

Not another state that falls under Brussel's tyranny.

 

[ArneHD]

What study are you referring to?

Can't remember, saw it on TV.

Edit: TV2 news to be specific.

 

[Volum]

I don't think this is enough to get Norway into the EU. As long as we're doing fine on our own i think well stay out. We have our oil money and a financial break down like Iceland is unlikely.

 

[holy king]

someone needs money. fast.

 

[RedRalph]

Edit: New PM is openly gay, a world first. the world is moving on

 

[really]

I'm not sure if the middle of a crisis is the best time for a country to be making a decision of this magnitude.

On the plus side the center of the Union will move back towards the north-west and there will be one more Atlantic island to annoy the continentals.

As long as they don't give away their fishing rights like we did when we joined they will be grand.

 

[TDK]

I don't see how Norway joining or not is related to Iceland. Wouldn't Norway face the same fishing disputes as Iceland?

I think a "unilateral euroisation" is probably more likely than full membership right now. In fact, is it not happening as we speak: Most debt(public and private) is in foreign currency, the exports are bringing in foreign currency and the consumer lost confidence in the Krona.
Maybe one of the macroeconomists on the board can enlighten us as to problems/opportunities to a unilateral approach.

TDK

 

[Agent327]

From guardian

Seems like a sensible choice, whichever way one looks at it.

 

[bhsup]

I thought you EU folks were pretty particular about this sort of thing. Didn't you decide awhile back (I thought it was early 90s IIRC) to push back entry of some nations because their economies were not quite up to snuff, EU-wise?

 

[ComradeDavo]

They can join..and i'd support that...as long as they stop hunting whales. If they continue whaling then they shouldn't be allowed in the E.U. No pro-whaling country should be allowe din the E.U. Whales are sentient beings, we should not allow a country which kills sentient beings to join.

 

[Winner]

I see the EU's masterplan is working: wait for an economic crisis, then blame it on America, then pose itself as a saviour offering a helping hand to the affected countries and take them under its "protection". They'll do it on their own, so it's all perfectly fine.

First it subjugated Britain and Ireland, now it is going to take Iceland and maybe even Norway, so I think Canada and Greenland (the island's withdrawal was only a temporary setback) are the next

Arctic resources are going to be controlled by the EU

 

[Winner]

Seriously though, there is a precedent for that - centuries ago, when fighting between the island's chiefs was threatening the very survival of Iceland, they invited the Norwegian king to rule the island.

This is the same, just in modern-world terms.

 

[Volum]

I did see a poll tough that showed that if the EØS/EEA agreement went away a majority said Norway should join also.

I guess it would be either that, or trying to get an agreement like the Swizz have.

 

[philippe]

Not another state that falls under Brussel's tyranny.

bwahaahaha.
really, it's hilarious. we are the tyrants of europe.

in the end, the Belgians won.

 

[mrtn]

bwahaahaha.
really, it's hilarious. we are the tyrants of europe.

in the end, the Belgians won.

You'll force all of Europe to speak Belgian, I'm sure.

I'd welcome Norway and Iceland into the EU.

 

[Yoda Power]

I care not much for Iceland, but if this could help Norway into EU, I would be thrilled.

 

[Godwynn]

This news makes me so happy.

Hooray!