Iceland's EU Entry Talks Urged by European Parliament Amid Bank Standoff
European Union lawmakers encouraged the start of EU membership talks with Iceland while making demands over banking and whaling that threaten to sharpen opposition to entry in the North Atlantic island.
The European Parliament, hailing the green light that EU heads of government gave three weeks ago to accession negotiations with Iceland, called on the country to break an impasse over foreign depositors’ claims and stop whaling. The leaders on June 17 set no deadline for membership, saying the pace of talks will depend on Iceland’s fulfillment of requirements to be set out in a forthcoming negotiating framework.
The government of Prime Minister Johanna Sigurdardottir is trying to reach a settlement over 4 billion euros ($5 billion) of claims from U.K. and Dutch depositors that stem from the failure of Landsbanki Islands hf in October 2008. The U.K. and Dutch governments covered the costs initially.
In its non-binding resolution today in Strasbourg, France, the EU Parliament said Iceland must make “further efforts” to comply with the bloc’s rules including those on deposit guarantees. The 27-nation assembly also urged Iceland to reach an accord to repay the U.K. and Dutch governments, saying this would “restore confidence in Iceland’s ability to honor its commitments” and strengthen public support in the country and the EU for membership.
Repayment Accord
An initial repayment accord was blocked by Iceland’s president, Olafur R. Grimsson, and subsequently rejected by 93 percent of voters in a March referendum. On July 1, representatives of Iceland, the U.K. and the Netherlands met for the first time in almost four months to discuss a settlement.
Enthusiasm for the EU in Iceland has waned since it applied to join in July 2009. Opposition to membership grew to 60 percent in June compared with 55.9 percent in February and 54 percent in November, according to a Capacent Gallup survey published earlier this month by Iceland’s state broadcaster RUV. Lawmakers from four of Iceland’s five political parties are pressing for the country to abandon the bid.
On fisheries, another area where the EU has pinpointed the need for Icelandic policy changes, the bloc’s 736-seat Parliament said it “insists that Iceland cease all whaling.” Finnish and Estonian members of the assembly’s Green group succeeded in getting this provision added to the resolution as an amendment in the floor vote.
Icelandic Fisheries Minister Jon Bjarnason said last month that the country had been told by Germany that whaling would have to stop before EU membership. He also pledged to resist such demands.
“We uphold our right to continue using our natural resources in a sustainable way,” Bjarnason told Iceland’s parliament. “We won’t bow to threats of any kind.”
To contact the reporter on this story: Jonathan Stearns in Strasbourg, France, at jstearns2@bloomberg.net
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