Iceland’s EU referendum reverberates through Norway’s European dilemma

If Iceland votes in favour of EU membership, its fellow Nordic neighbour Norway will find itself in an uneasy position, facing growing pressure to reconsider its own ties with Brussels.

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Oslo is watching Saturday’s referendum closely. Norway, the non‑EU country most directly affected, could see its strategic calculus altered if Reykjavík joins the Union.

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Foreign Minister Espen Barth Eide warned parliament in May that an Icelandic accession would create special challenges for Norway as an EEA member, noting that the European Economic Area would become far less representative.

A shrinking club

The EEA currently extends the EU single market to three non‑EU countries: Iceland, Liechtenstein and Norway. Should Iceland become an EU member, the arrangement would shrink to just two parties, one of them being the tiny state of Liechtenstein, whose economy is tightly linked to Switzerland.

In practice this would turn the EEA into a bilateral pact between the EU and Norway, leaving Norway as the only major economy in the European single market without a seat at the decision‑making table.

Iceland would not be the first country to graduate from EEA participation to full EU membership. When the agreement entered into force in 1994 it also covered Austria, Finland and Sweden, all of which later joined the Union after successful referendums.

Technically the EEA would remain in place if Iceland joined, but politically it would be harder to justify the pact as a meaningful alternative to full membership.

“If Iceland should become a member of the EU, the balance of power between the parties to the EEA Agreement – originally 12 countries to 7 – will become 28 to 2,” Eide said.

That imbalance explains why Norway’s government, while defending the EEA as the basis of its relationship with Brussels, cannot ignore the fallout of a “Yes” vote.

“Whatever path Iceland takes, we must work to strengthen our cooperation with the EU,” Eide added.

A troubled history

The EEA emerged from Norway’s complex relationship with the European project. Norwegians have twice rejected EU membership in referendums – in 1972 and 1994 – voting “No” by margins of 53.5 % and 52 % respectively.

A poll published earlier this month by the Norwegian daily ABC Nyheter showed that 49 % would now vote against EU membership, while 37 % would support it.

The core concerns – fisheries, agriculture and a reluctance to trade sovereignty for limited influence in a larger bloc – have changed little since the 1990s.

Iceland shares many of these worries. Saturday’s referendum, however, does not ask whether the country should join the EU outright; it seeks a mandate for the government to resume accession talks that were suspended in 2015.

A second vote would then decide whether voters approve any eventual deal.

Oslo will watch Iceland’s negotiations closely, a development that could weaken Norway’s EU‑sceptic stance. Hallgrimur Oddsson, director of the think‑tank Evrópustraumar, said Norwegians would “follow very closely” how the talks unfold, especially on issues such as fisheries.

He expects pro‑EU parties to seize any momentum to revive the membership debate, noting that Norway has already held two referendums on the issue and that “their history is also different.”

Even if Iceland’s vote provides fresh impetus, Norway would still need to build its own case for joining, a process that would require a major national debate for which there has so far been little appetite.

Reopening old wounds

Norway’s concerns and the positions of its main political parties have remained largely unchanged since the last membership debate. Serious discussion about reopening the question is scarce, partly because politicians and voters remain wary of the divisions left by earlier campaigns.

In the current geopolitical climate, many argue that reopening such a sensitive issue – one that has split the country and even families – is the last thing Norway needs.

When the Icelandic government formally asked parliament to hold a referendum, Trygve Slagsvold Vedum, leader of the Eurosceptic Centre Party, warned that it could reinvigorate Norway’s own pro‑EU movement.

“The EU forces in Norway will paint a frightening picture of Norway outside the EU. We will see an unprecedented black painting,” Vedum said, describing opposition to EU membership as the most important issue in Norwegian politics.

By contrast, Guri Melby, leader of the pro‑EU Liberal Party, said Iceland’s referendum should give fresh impetus to a debate on Norwegian membership and urged Norway to learn from Iceland’s less divisive approach.

At a parliamentary hearing in March, Conservative MP Ine Eriksen Søreide argued that conditions in Europe and the wider world had fundamentally changed. As the EU deepens its integration, she said, it will become increasingly difficult for Norway to safeguard its interests from outside the bloc.

Whichever way Iceland votes on Saturday, Norway will feel the consequences. And if Reykjavík’s path toward EU membership becomes more likely, Norwegians may find themselves forced to revisit the thorny question of their own place in Europe.

Jorge Liboreiro contributed to the reporting.

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