As expected, EU leaders meeting for their monthly summit in Brussels have agreed to open membership negotiations with Iceland
, despite its failure so far to refund the UK and the Netherlands for lost savings.
Iceland, while still reeling from the collapse of its major banks, submitted its application to join the EU last July and has now achieved full membership candidate status although the majority of Icelandic citizens (57%) still say they will vote against joining the 27-member bloc according to a recent poll published in Le Figaro
In the Summit meeting on Thursday, the European Council signed off on language approving the start of official talks, with the British and the Dutch leaders insisting on the agreement’s wording that made implicit mention of the ongoing ‘Icesave’ banking dispute
The UK and Dutch governments want Iceland to reimburse them some €3.8 billion
(£3.2 billion) that they paid out to savers who lost money when Iceland's online bank Icesave went bust in 2008.
The European Council "notes that Iceland meets the political criteria set by the Copenhagen European Council in 1993 and decides that accession negotiations should be opened,
" says the text.
"It recalls that negotiations will be aimed at Iceland ... addressing existing obligations such as those identified by the EFTA Surveillance Authority under the EEA Agreement, and other areas of weakness,
" the communiqué, which notably continues to state "including in the area of financial services.
The European Free Trade Association Surveillance authority
essentially performs the same executive role as the European Commission, but for the countries of the European Free Trade Association
, the free trade body linking Iceland, Norway, Lichtenstein and Switzerland to the EU.
The Icelandic government has already agreed to pay the countries back, but the terms at which the repayments are to be made are widely considered onerous by a majority of the population. Under the agreement the loan will be paid back over 15 years with interest
, with some estimates suggesting every Icelandic household will have to contribute around €45,000
Apparently, in the meeting, the outgoing Dutch Prime Minister Jan-Peter Balkenende
told his fellow leaders that his country would not block negotiations, so long as Iceland fulfils its “hard demands
Following the announcement, Iceland's ambassador to the EU, Stefan Johannesson, said "It is self-evident that Iceland will live up to its obligations. There is no question.
“We are fully committed to the ongoing negotiations and see the issue being resolved with the UK and the Netherlands,” he said. "We're not expecting any special treatment, we want to be judged on objective criteria but one can't deny that the track is very short."
The island situated in the North Atlantic gained its independence from Denmark on the 17th June 1944
– exactly 66 years ago today. It has a population of just 323,000 and is also in the Schengen zone
, so Icelanders already enjoy passport-free travel to much of Europe.
must now develop a negotiating framework, which due to the largely positive accession assessment of Iceland's prospects made by the EU executive in February
, should realistically only take a few months to formulate. The negotiating framework must then be adopted by the Council of Ministers
, which consists of representatives of all the current member states.
After this step, a first intergovernmental conference between Iceland and the member states takes place. The next stage of the accession negotiation process should occur before the end of the year, according to the Commission.