Why Iceland said no to Brussels

Hjörtur J. Guðmundsson is an historian and MA in International Relations living in Reykjavík, Iceland.

We just had, in many ways, the most bizarre referendum in Iceland on whether to relaunch accession to the European Union. Not due to the results, which saw 52.8% of the electorate reject the idea, but due to the way it was carried out. The previous accession process, or, as the main advocates of starting the process have put it, “to look inside the package”, began in 2009 only to be put aside by a new government four years later. After all, their main emphasis during the debate this summer was that the vote was not actually about seeking EU membership but merely to see what Brussels had to offer.

This is how EU membership has been presented to Icelanders for decades. Those promoting it have refrained from saying Iceland should join the EU, claiming the idea was simply to get a deal on the table to see its contents. In other words, the most ardent proponents of EU membership in Iceland have evidently been very much aware of the fact that it is not a good product to sell to Icelanders. The run-up to the referendum at the end of August was no exception to that. In fact, when those on the opposite side said this was about EU membership, it was fiercely protested by the proponents.

This was also evident before the last general elections in November 2024. For the first time, the Liberal Reform Party (Viðreisn), the party most in favour of EU membership and which was in fact founded in 2016 on the basis of getting Iceland into the EU, did not include that in its election platform and furthermore refrained from addressing the issue in the run-up to the elections. When its leaders were asked by the voters or the media if a referendum like the one we just experienced would be a condition for joining a coalition government after the elections, they did not give a clear answer.

There is a reason for this changed approach. In the summer of 2024, the European Movement Iceland, whose leader at the time was a former MP for the Liberal Reform Party, commissioned an opinion poll asking six questions. The results for three of them, where people were asked whether they would vote for a party that put an emphasis on a referendum on accession talks in the next general elections, were never made public. The next thing we knew was that the party, for the first time, did not make the case for exploring EU membership in the run-up to the general elections the following autumn.

However, when the general elections were over and the people had cast their votes, the Liberal Reform Party made a referendum on EU accession a condition for joining a government with the Social Democratic Alliance (Samfylkingin) and the People’s Party (Flokkur fólksins). During the election campaign, the Social Democrats said the issue would not be on the agenda after the elections, and the People’s Party opposes EU membership according to its platform. However, the parties agreed that there would be a referendum on continued EU accession talks before the end of 2027.

Meanwhile, the three parties forming the opposition, the Independence Party (Sjálfstæðisflokkurinn), the Centre Party (Miðflokkurinn) and the Progressive Party (Framsóknarflokkurinn), all reject EU membership. Before the general elections, the leader of the Liberal Reform Party, the current Foreign Minister Þorgerður Katrín Gunnarsdóttir, said to the media that a referendum was a “very big compromise” by her party. After all, it is quite evident that had there been a parliamentary majority in favour of seeking EU membership, the referendum would never have taken place.

The main reason the referendum was brought forward and held at the end of last month was that opinion polls were developing unfavourably for the Liberal Reform Party, with increasing opposition to both EU membership as such and to restarting accession talks, something that has had a strong tendency to occur in Iceland when the issue has been put on the agenda, as is often the case with referendums in other European countries regarding EU integration steps such as adopting the euro, which is, of course, a big headache for those who favour EU membership.

Those who called for the accession process to be restarted furthermore attempted to use the high interest rates and inflation in Iceland, and the difficulties of many households to make ends meet as a result of that, as an argument for restarting the accession talks, claiming that joining the EU and adopting the euro would bring lower interest rates. Meanwhile, those rejecting the idea pointed out that the low main interest rates in the eurozone were mainly due to economic stagnation with little or no growth, limited productivity and high unemployment, especially among young people.

The main argument of those rejecting the renewed accession process was, however, Iceland’s sovereignty, including over its natural resources and, not least, the fishing grounds. The ability to conclude independent free trade agreements also played a significant role. After all, joining the EU would always mean transferring large parts of the country’s autonomy to Brussels regardless of what a possible accession deal could have included, especially considering Iceland’s small population, which would be a fundamental factor within the EU regarding its ability to influence decisions.

The results of the referendum are a huge blow to the Icelandic government and, especially, of course, the Liberal Reform Party. But it goes much further than that. The EU had hoped a positive outcome from the vote would boost its enlargement scheme, demonstrating that joining the bloc was still appealing, not only to net-receiving countries in Eastern Europe. Both Icelandic and EU leaders have, since the referendum, tried to put on a brave face and convince themselves and others that the effects are minimal or non-existent, despite the glaring fact that calling the vote was simply a bridge too far.

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