“The reasons for joining the euro didn’t work out in Cyprus,” Sigmundur David Gunnlaugsson, the head of the Progressive Party, said in an interview. “What the economic crisis in Iceland and Europe has taught us is the importance of being able to control your own destiny.”
As the financial crisis unraveled, Iceland notably let its big banks fail, shunting off a sizable chunk of the losses onto foreign investors. Seeing Cyprus, and even more Greece, have its recovery policies dictated by a cadre of hectoring Eurocrats from Brussels (who paradoxically have quite a bit to lose should Greece in particular start defaulting) must not sit well in Reykjavik. Not being in the EU in 2008 felt like having dodged a bullet. Why step into a new fusillade now, voters must be thinking.But it’s not just how Europe has behaved towards its periphery that has Icelanders rethinking their futures. Europe’s brand is tarnished, and a small country like Iceland seems to think it could do better engaging with the world on its own terms.
“It seems Europe has entered a period of historic decline,” [Sigmundur David Gunnlaugsson] said, adding that Iceland must build ties with growing countries in Asia and elsewhere.Iceland recently became the first European country to sign a free-trade agreement with China, for instance. And licenses are being issued to foreign oil and gas companies in Europe and Asia interested in developing Iceland’s untapped fields of natural resources.
That’s about it in a nutshell: Europe is losing its pull in its near-abroad while a rising power half-way around the world swoops in. How far the EU’s star has fallen: Once upon a time it had aspirations to be a global counterweight to the United States.[Downtown Reykjavik image courtesy of Shutterstock]