Donald Trump Effect? Why Iceland Is Suddenly Reconsidering Joining The European Union

Last Updated:May 26, 2026, 16:08 IST

Trump’s second presidency is not only reshaping America’s role in the world, but also forcing smaller allies to rethink where they truly belong geopolitically

For years, Iceland seemed comfortable staying outside the European Union while still enjoying access to Europe’s single market through the European Economic Area. Now, that calculation is beginning to change, with many in Iceland believing the trigger to be Donald Trump.

A debate that had largely faded after Iceland froze EU accession talks more than a decade ago has suddenly returned to the centre of national politics. Iceland’s capital Reykjavik is now preparing for a referendum later this year on whether negotiations to join the EU should formally restart.

According to a report in The New York Times, Iceland’s political mood has shifted sharply amid growing geopolitical uncertainty in the Arctic and fears over the future reliability of the United States as a security partner.

At the centre of those anxieties are Trump’s repeated comments about Greenland and his broader rhetoric around territorial expansion, tariffs and NATO allies.

Why Greenland Matters To Iceland

Trump’s aggressive rhetoric toward Greenland, including renewed suggestions that the United States should take control of the Arctic island, deeply unsettled Nordic governments.

While Greenland belongs to Denmark, the controversy sent shockwaves across the wider Arctic region, including Iceland and Norway, where Al Jazeera reports policymakers began openly discussing whether small northern states could become strategically vulnerable in a more transactional global order.

Iceland, unlike many European countries, does not have its own standing military and has historically relied heavily on NATO security guarantees and close ties with Washington. But Trump-era uncertainty has triggered new conversations inside Iceland about whether deeper integration with Europe now offers greater long-term strategic protection.

One major concern has been the perception that Europe may increasingly need to defend its own geopolitical interests independent of Washington.

The EU Debate Iceland Thought Was Over

Iceland originally applied to join the EU in 2009 after the country’s devastating banking collapse triggered economic turmoil. Negotiations formally began in 2010.

But support for membership faded over time, especially over disputes linked to fisheries policy, sovereignty concerns and fears that EU rules could hurt Iceland’s control over its fishing industry—a pillar of the national economy.

In 2013, a Eurosceptic government froze accession talks, and by 2015 Iceland effectively stepped away from the process altogether.

Now, more than a decade later, the issue is back.

Prime Minister Kristrún Frostadóttir’s coalition government has agreed to hold a referendum on August 29, 2026, asking Icelanders whether accession negotiations with the EU should resume.

The vote will not immediately make Iceland an EU member. It would only reopen formal negotiations, which could still take years and would likely require another referendum before final accession.

Trump’s Tariffs Also Responsible

Security concerns are only part of the story.

Trump’s tariff policies and renewed economic nationalism have also increased worries among smaller export-driven economies like Iceland. The Week reported that Icelandic policymakers increasingly fear becoming economically exposed in a world where global alliances are becoming more unpredictable.

At the same time, Iceland already participates in many parts of the European system through the Schengen zone and the European Economic Area, meaning the transition toward fuller EU integration may appear less dramatic than it would for many other countries.

Europe’s Arctic Strategy Is Changing

Iceland’s renewed EU debate is also part of a broader northern European rethink.

The Spectator reported that Norway, another wealthy Nordic country long sceptical of EU membership, has also seen fresh debate over whether remaining outside the bloc still makes strategic sense in an increasingly unstable Arctic environment.

The Arctic is rapidly becoming one of the world’s most contested geopolitical theatres because of shipping routes opened by melting ice, energy and mineral resources, military positioning, and growing competition among the US, Russia and China.

Issue Beyond Iceland

For the EU, Iceland’s reconsideration carries symbolic importance. At a time when Europe is trying to project unity against geopolitical uncertainty, Iceland moving closer to Brussels would signal that fears about fragmentation after Brexit may be easing.

Ironically, while Britain spent years leaving the European Union, parts of northern Europe now appear to be moving in the opposite direction; driven not just by economics, but by security fears tied to an increasingly volatile global order.

That shift also reflects a larger reality emerging across Europe: Trump’s second presidency is not only reshaping America’s role in the world, but also forcing smaller allies to rethink where they truly belong geopolitically.

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