Iceland votes in referendum on reopening door to the EU

Iceland votes on the EU: the ballot doesn't ask what it seems to

What is Iceland deciding on Saturday the 29th? If you go by the headline, the answer is simple: to join the European Union or not. The actual ballot says something else: "Should negotiations on Iceland's accession to the European Union be resumed?" Yes or no. And it is advisory. Even if the yes vote wins, all that reopens is a process frozen since 2013; membership would have to be voted on again, once an agreement is on the table. In other words: the referendum does not decide membership. It decides whether to talk about it again.

Iceland is not holding this vote out of love for Brussels. It is holding it because of the price of tomatoes: six small ones cost 980 kronur, almost seven euros at the exchange rate. A plain hamburger, 28 euros. The most expensive country in the world has inflation in its shopping basket and Europeanism as a possible way out. The hope is that trade with the EU will at least make goods transport cheaper. The experience of other countries suggests that joining has never come with a drop in prices for basic goods. And there is a nuance lost in the debate: Iceland has been inside the single market since 1 January 1994, via the European Economic Area.

Arctic geopolitics: the argument that isn't economic

With 400,000 inhabitants, Iceland is a small but strategically awkward partner. It is a step away from Greenland, right where Trump's expansionism has focused attention, and in the middle of the trade route China wants to open in the Arctic. Some argue the EU interests Iceland more as a geopolitical umbrella than as a market. The trade-off is the loss of room for manoeuvre in trade policy and regulation, a cost that sceptics do not consider a done deal.

What the EU does not promise

The cheaper-living argument does not hold up well. Tariffs would fall, but neither ships nor planes will magically get cheaper, and the structural changes needed to bring down the cost of the shopping basket could already have been made through partial agreements. The divide resembles Norway's three decades ago: the capital in favour, the countryside antiestéticarful of competition.

Meanwhile, in Reykjavik people will keep paying more than 22 euros for a takeaway pizza. The EU has not promised to make it cheaper. And no one has explained how to sell that promise to someone paying 28 euros for a hamburger.