VZCZCXRO9391
OO RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSK RUEHSL RUEHSR RUEHVK
RUEHYG
DE RUEHRK #0123/01 1971751
ZNR UUUUU ZZH
O 161751Z JUL 09
FM AMEMBASSY REYKJAVIK
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4114
INFO RHEHNSC/NSC WASHINGTON DC IMMEDIATE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 02 REYKJAVIK 000123 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EUR DAS GARBER, EUR/NB, INR/B 
NSC FOR HOVENIER 
 
E.O. 12958: N/A 
TAGS: PGOV PREL PINR EUN IC
SUBJECT:  ICELAND: PARLIAMENT PASSES RESOLUTION TO APPLY FOR 
EUROPEAN UNION MEMBERSHIP 
 
¶1. (U) Summary: The Icelandic parliament passed a resolution on July 
16 to enable the government to start accession negotiations with the 
European Union (EU). The parliament approved the controversial 
legislation with a slightly larger majority than expected, and 
fulfills the Social Democratic Alliance's number one campaign 
promise. The second reading of the resolution took almost a week and 
was at times tumultuous. The GOI will very soon submit a formal 
application for EU membership to Brussels, after which the Council 
of Ministers will refer the application to the EU Commission. The 
process of negotiations could take up to three years.  But before 
Iceland joins the EU, the final negotiated agreement must be 
approved in a national referendum, which is by no means certain at 
this date. End Summary. 
 
¶2. (U) Iceland's parliament voted on July 16 to authorize the 
government to begin accession talks with the EU. Members of 
parliament voted 33 to 27 in favor of an EU application following a 
final round of debates that lasted for almost a week.  The margin of 
victory was a bit larger than had been expected, with three MPs 
abstaining from the vote. Notably, one Independence Party (IP) 
Member of Parliament (MP) voted in favor, and the IP deputy chair 
abstained.  Pundits had expected the IP to present a unified 
opposition to the EU resolution. The vote paves the way for an 
application to be sent to Brussels later in July and gives PM 
Johanna Sigurdardottir a major achievement - one which she has 
campaigned for vigorously since becoming PM in February. If the 
application is approved by EU member states, Iceland would put the 
question on actual EU membership to voters in a referendum. 
 
¶3.  (U) When the Social Democratic Alliance (SDA) and the Left-Green 
Movement (LG) formed a majority coalition government on May 10, they 
announced in their policy statement that the Foreign Minister would 
submit a parliamentary resolution on Iceland's application for EU 
membership in the first days of the new parliament, which convened 
for its summer session on May 15. The SDA had made EU membership a 
key issue in their electoral campaign. The two parties agreed that 
if the resolution passed and accession negotiations would ensue, 
then the negotiated accession treaty would be put to a national 
referendum, possibly as early as 2010. 
 
¶4.  (U) Soon after the Foreign Minister submitted the draft 
resolution in parliament, the IP and the Progressive Party (PP) 
submitted a counterproposal on EU membership, claiming that the 
government's resolution presented insubstantial arguments in favor 
of membership. The IP-PP resolution called for a more detailed 
explication of Iceland's most important interests in accession talks 
with the EU, a road map on the arrangement of accession talks, and 
an explanation of what needs to be done to ratify an accession 
treaty. The parliamentary Foreign Affairs Committee discussed both 
resolutions and tried to merge them into one, which the parliament 
passed today. Later, the IP proposed an amendment requiring a double 
referendum, (i.e., one on whether to start accession negotiations 
and one on the negotiated accession treaty), but this amendment was 
voted down today. 
 
¶5. (U) Today's resolution had to pass two readings before the vote. 
The first reading continued for two days, but the second lasted for 
more than six. Speaking time was doubled by the Speaker of the 
Parliament to give everyone a chance to have their say. The second 
round of debate was chaotic, and often interrupted by the emergence 
of secret documents that the MPs said had to be reviewed before 
continuing the debate.  When the Parliamentarians took the floor, 
some MPs towed the party line, while others said they thought it was 
in Iceland's best interest to see what kind of an accession treaty 
could be negotiated. A few talked about the positive history and 
impact of the EU, while some likened it to the Soviet Union. Several 
Althing members, especially from the Citizens' Movement, tried to 
engage in horse trading by threatening not to support the resolution 
unless the government dropped its controversial Icesave bill, which 
is also being debated in parliament. The media had a heyday 
speculating on how those MPs who had not yet made up their mind were 
going to vote. 
 
¶6. (U) The application for EU accession will first go to the Council 
of Ministers which will then refer the application to the EU 
Commission, a process that will likely take up to six months. After 
that, the actual accession talks will commence and they can take up 
to three years.  This time could be shortened because of Iceland's 
prior participation in many areas of the EU through its membership 
in the European Economic Area. Without a doubt, the most challenging 
subjects will be the fisheries sector and agriculture.  As of now, 
Iceland does not fulfill the Maastricht criteria for adopting the 
euro as its currency. 
 
¶7. (SBU) Comment - This was a big victory for Prime Minister Johanna 
 
REYKJAVIK 00000123  002 OF 002 
 
 
Sigurdardottir and her SDA party - both have had difficult sledding 
over the last couple of weeks. The Prime Minister summed up the 
situation nicely in a radio interview immediately after the vote, 
"This is the result we were hoping for... It's a great day for us." 
Sigurdardottir's enthusiasm may not be shared by a majority of 
Icelanders.  Recent polls show that an accession treaty would be 
turned down in a national referendum if a vote were held today. 
Clearly, the economic situation in Iceland in two to three years' 
time will have a major impact on the final decision. End Comment. 
 
KLOPFENSTEIN