VOTERS are heading to the polls to decide whether the country should resume negotiations on becoming a member of the European Union after 13 years.
A No vote majority among the 265,000 eligible voters to the question “Should Iceland resume accession negotiations with the European Union?” would mean the country remains outside the bloc and the issue is rested, for a generation at least.
A Yes vote would trigger the start of a negotiating process with the EU’s executive branch, the European Commission.
When will the result in Iceland be announced?
Voting is due to go on from 9am until 10pm on Saturday. The result is expected in the early hours of Sunday.
More than one in five voters of the 400,000 population had already cast their ballots in early voting before Saturday, according to Iceland's public broadcaster RUV.
What are the key issues?
The country fought to secure full independence from Denmark in 1944, and control of its surrounding waters remains politically sensitive. Fishing and marine products account for almost 40% of Iceland’s exports, making access to its seas central to both its economy and national identity.
The No campaign has warned that EU membership could mean losing control of Iceland’s prized fishing grounds through the Common Fisheries Policy. It has pledged never to share the country’s waters, although Brussels has indicated that Iceland could potentially secure an exemption or special arrangement.
Fisheries are widely seen as the biggest potential obstacle to any accession deal.
Many Icelanders also remember the Cod Wars with the UK, when Iceland successfully expanded control over its fishing waters during a series of disputes in the 1970s. Fishing rights were a major factor in previous attempts to take Iceland into the EU.
Reykjavik did begin accession talks following the 2008 financial crash, which brought about the collapse of Iceland’s banking system. However, negotiations started in 2009 were halted in 2013.
Iceland is now among Europe’s wealthiest nations. Eirikur Bergmann, professor of politics at Bifrost University, told the BBC that “many people attribute this to Iceland’s independence”.
However, the country’s high cost of living remains a major concern. A trade union survey this year suggested Iceland was the most expensive country in the world, considerably pricier than its Nordic neighbours.
Despite having the fifth-highest GDP per head in the world, Iceland’s interest rate remains at 8%, while inflation has risen to 5.6%.
Yes campaigners argue that closer economic integration with the EU could help bring down borrowing costs and ease some of the pressures facing households.
There is also unease over Donald Trump’s stated interest in taking control of Greenland.
When Trump talked about US control of Greenland, particularly at the start of this year, he altered the mood in Iceland, and the underlying worry among many in the country is clear – if Greenland is seized, is Iceland next?
Some believe the European Union could offer protections if Trump were to ever make similar threats on Iceland, and observers say that may affect Saturday’s referendum.
