Iceland Votes on EU Membership Resumption Amid Tight Referendum Race

Icelanders began voting Saturday in a critical referendum on whether to resume membership negotiations with the European Union. The outcome of this tight race is being closely watched in Brussels, as it could shape the nation's future relationship with the bloc.

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Should Iceland resume accession negotiations with the European Union?

Iceland, with a population of just under 400,000, initially applied for EU membership in the wake of a devastating 2009 financial crisis. However, membership talks were suspended in 2013 when a eurosceptic government took power. The current referendum asks voters a simple 'Yes' or 'No' question: "Should Iceland resume accession negotiations with the European Union?"

Polls indicate an exceptionally close contest. The latest Gallup poll gave the 'No' camp 51.6 percent of voter support, with the 'Yes' side at 48.4 percent – a margin within the statistical margin of error. "It's pretty tight, but I'm always optimistic," stated Foreign Minister Thorgerdur Katrin Gunnarsdottir, a strong proponent of EU membership, ahead of the vote. Reliable results are not expected until late Saturday at the earliest, given the absence of exit polls.

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It's pretty tight, but I'm always optimistic.

If the 'Yes' vote prevails, an accession agreement would be negotiated with Brussels and subsequently put to another referendum for final approval. Key issues, such as fisheries – a cornerstone of Iceland's economy over which Reykjavik seeks to maintain exclusive control – would need to be resolved with the EU. The EU appears more willing to compromise on this issue this time around.

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It's not done until it's done.

The debate is largely domestic, but geopolitical shifts, including the potential impact of a second term for US President Donald Trump, are also factors. With Iceland's economy now flourishing, some voters question the necessity of joining the EU, especially since the country already benefits from access to the single market as a member of the European Economic Area. Others, however, are drawn to the prospect of joining the eurozone to benefit from lower interest rates, which have soared in Iceland, impacting mortgage holders.

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The fundaments (of the debate) are very domestic, but there is a significant impact that has come with the second term of (US President) Donald Trump and this sort of geopolitical upheaval.