Rhein on Energy and Climate

After the narrow vote by the Parliament, the Icelandic government has immediately submitted its formal application for EU membership on July 17th. The Council will be wise to wait until after the Irish referendum before inviting the Commission to prepare its opinion. Under optimistic assumptions one should assume negotiations to start as of 2010 and to be concluded by the end of 2011.

With just 320 000 inhabitants Iceland would be the smallest member state after Malta. It has to offer three major assets:

· It is one of the wealthiest countries on earth, due to the work ethics and education of its people and the favourable rapport between resources and population.

· It possesses big fishing stocks, an impressive potential for hydropower and geothermal energy and a largely unspoiled nature.

· It controls the strategic sea lanes from the Atlantic into the Arctic Sea.

Negotiations should be easy.

Like Norway and Switzerland, Iceland is part of the European Economic Area, under which the country has adopted large chunks of the EU acquis. The only policy areas expected to cause difficulties will be fishery and agriculture. Iceland will have to adopt the common fishery and agricultural policies within a reasonable transition period, say 5-7 years. This will not be easy for a country that has been proud of its fishing tradition and for which fishing has been over centuries a mainstay of its economy. But we are no longer in the 1970s when Iceland progressively extended its fishing area to 200 miles and provoked the famous “cod wars” with Britain. Today fishing is far less important for Iceland than it used to be. That also goes for the EU. Fish farming increasingly competes with high-sea fishing suffering from over-fishing.

From the EU perspective the accession of Iceland should not pose any serious problems; the first reactions from the Commission and several member states have therefore been very positive.

There is only one snag, which the political class tends to overlook as trivial: Under the modified rules of the Lisbon Treaty Iceland – like any member states – will be entitled to a Commissioner. Assuming Croatia to join simultaneously with Iceland the next Commission will end its mandate in 2015 with 29 members, twice as many as in 2003! Assuming the progressive accession of the remaining Balkan countries the number of Commissioners will rise to 33 by the end of the next decade.

It is difficult to imagine 33 meaningful Commission departments. The consequence will be a further slicing of departments, which will make internal coordination ever more difficult. The Commission should therefore create “Commissioners without portfolio” for specific assignments

Iceland’s bid for EU accession shows that the attraction of the EU is as big as ever. The winds of globalisation are easier to face when standing in a group. Iceland had to learn this the hard way in 2008. Had it been an EU and euro-zone member, it would not have come close to insolvency!

Normally new EU member countries should strengthen the “Club” by the additional resources they add. But this rule is only valid if the enlarged EU is able to adapt its structures and working methods to the change of dimension. Such changes will become next to impossible under the provisions of the Lisbon Treaty. The EU will therefore pay a rising price for every new member state. Governments should remember this when they decide on the Icelandic accession demand.

Brussels, 17.07.09 Eberhard Rhein

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  1. It’s a big strength when standing in a group. All other nations will also get benefited from this if Iceland has adopted the common fishery and agricultural policies.

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