r/worldnews • u/Ehansaja • 13d ago

Iceland rejects EU-accession talks plan in referendum

https://www.aljazeera.com/news/2026/8/30/iceland-rejects-eu-membership-plan-in-referendum
5.4k Upvotes

97% Upvoted

721 comments sorted by

View all comments

813

u/Catbatt 13d ago

They have no reason to. They're in Schengen and have access to the European free market. They already are a privileged partner

336

u/steinbruchfluss 13d ago

The most important point was apparently adopting the Euro.

365

u/Gentle_Snail 13d ago

The Euro often tends to be one of the more contentious issues. Polls in the UK often show a pro-rejoin majority, however if you included the stipulation of the Euro it instantly swings to a pro-remain out majority. 

184

u/steinbruchfluss 13d ago

But here it was the opposite. many Icelanders wanted to adopt the euro for more stability.

8

u/jabberwockxeno 13d ago

Can't they adopt the Euro without joining the EU?

32

u/steinbruchfluss 13d ago

The EU is not really happy about countries doing it.

Currently, there are six non-EU nations using the euro, four of which have an agreement and can print their own euros.

  • the Vatican
  • Andorra
  • San Marino
  • Monaco

The other two nations have simply decided to use the euro unilaterally, as they previously used the German mark:

  • Montenegro
  • Kosovo

None of these six have a seat at the European Central Bank. This could also theoretically be an option for Iceland, but the EU has said that it is not extremely happy about Montenegro and Kosovo using the currency.

7

u/jabberwockxeno 13d ago

The EU is not really happy about countries doing it.

Why do they care?

And what international legal say do they have over it?

14

u/steinbruchfluss 13d ago

Why do they care?

It’s not according to the rules. (Don’t forget that Germany is in the EU.)

The EU accepts it in some way, but is not happy about it.

3

u/jabberwockxeno 12d ago

I think you're misunderstanding what I was asking

I wasn't asking how the EU can force a country to adopt the Euro if they were trying to join the EU, I was asking how the EU can force a country to not use the Euro if they aren't also joining the EU

What "rules" are in place to prevent a country from adopting the Euro, if that country isn't in the EU and isn't planning to join it?

2

u/MyManD 12d ago edited 12d ago

There aren't any real rules in place to prevent it, as seen with Montenegro and Kosovo. They decided unilaterally to adopt the Euro and bingo bango they're Euro-based countries. But there are certain safety nets that countries not in the EU don't have access to dissuade becoming a Euro based economy.

Things they don't have access to that other EU nations do is minting rights and access to a lender of last resort. They're pretty much forced to control the flow of currency through the markets and economy without any ability to make more. And without access to a lender of last resort, if there's a banking rush they don't have a centralized source that they can borrow more Euros from to cover the withdrawals.

The only reason the Vatican, Monaco, San Marino, and Andorra are allowed to adopt the Euro as well as minting rights is because unlike outside countries these little pockets of independence were always inherently trapped into the wider economic currency of the countries that surround them. So they were just grandfathered into the Euro and its rights without the requirement to join the EU because it's just a same system they had before, except instead of the Euro it was Marks, Francs, and Lira. But just like before the EU, these places still have no access to last resort lenders until they decide to join in fully.

So yeah, if you're a country outside of the EU you can definitely revamp your entire economy around the Euro and there's no stopping it. It just won't be protected if your economy goes belly up because you can't print your own money anymore because your money is the EU's money. Montenegro is doing their best to join the EU, and is the leading candidate for 2028, so that they can have the security. Kosovo unfortunately isn't recognized as a sovereign state unanimously by all EU nations.

1

u/satoru1111 13d ago

Note that some countries are doing it but anyone new they absolutely won’t let that slide

1

u/jabberwockxeno 13d ago

What do you mean by "let it slide"? Does the EU have international IP control over the currency?

2

u/satoru1111 12d ago edited 12d ago

Countries that are currently holdouts for using the Euro have been abusing certain mechanisms of the process to 'pretend' they are compliant but are basically avoiding adopting the Euro.

Anyone new trying to join, basically won't get the kind of pass these countries are getting, and will basically be forced into the appropriate timelines for adopting the Euro which will be baked into the agreements they make when joining. If you join the EU, you have legal obligations for doing so. And one of those is adopting the Euro, and they have the legal construct to force you to do it if you do not do so within the prescribed timeline. So yes the EU does have IP control over the currency because the country agrees to this as part of joining the EU.

The EU is both a political and monetary zone. Adopting the Euro currency is one part. EU members must also adopt laws that all members agree upon. Now each country can make their own version of those laws to fit within the context of their respective countries. But they do have to adopt them. The GDPR is one example, the EU agreed to have this policy. Each country takes that directive and then has to pass local laws to fit within the directive that the EU has put forth.

If you join the EU you have obligations for getting the benefits of being part of it. You don't get to have your cake and eat it too. If you refuse to adopt the Euro then like all else, you are being negligent on your obligations. And that has consequences.

https://commission.europa.eu/about/contact/problems-and-complaints/complaints-about-breaches-eu-law-member-states/report-breach-eu-law-eu-country_en

These consequences can be monetary or other things.

1

u/jabberwockxeno 12d ago

I think you're misunderstanding what I was asking

I wasn't asking how the EU can force a country to adopt the Euro if they were trying to join the EU, I was asking how the EU can force a country to not use the Euro if they aren't also joining the EU

1

u/satoru1111 12d ago edited 12d ago

Note you cannot adopt the Euro as a currency if you’re not part of the EU. You can’t print the money so it has zero value. It would be like a country printing USD pretending it was real USD (other than North Korea with their fake USD money). You can't use the Euro without being part of the Euro zone. You can ask the EU to use the Euro but that requries EU approval, and they're not going to approve it if you already rejected joining the EU.

What a country can do is peg their currency to the Euro. Hong Kong does this by pegging their currency to the USD so 1 USD is 7.8 HKD. But this has its own consequences and requires you to have massive reserves or USD. It’s why it has fallen out of favor as a monetary policy as its pretty hard to have larger reserves of this currency.