Framsaga á fjarfundi sendiráðs Íslands í Kanada um utanríkisstefnu Íslands
Thank you for being with us today, and special thanks to the Icelandic Canadian Chamber of Commerce and the Icelandic American Chamber of Commerce for organizing this event.
It is an excellent opportunity for me to engage with a broad group of representatives from all over the world. I will focus on our overall policies, with a special focus on the bilateral relations with Canada and the US.
Foreign policy priorities
For a small country like Iceland, our long-term interests can only be secured by ensuring respect for international law and a continuation of a strong multilateral system.
Our foreign policy is based on respect for human rights, democracy, and the rule of law. These values underpin our alliances and our work in international organizations.
We emphasize free and open international trade based on clear rules which govern the international trade system.
When trusted with leadership roles, we continue to be a voice for individual rights and freedoms and in light of our positive experience, we remain strong advocates for gender equality and women’s empowerment.
Iceland is a founding member of NATO, and we are firmly committed to shouldering our responsibility as an ally. Following Russia’s invasion of Ukraine, there has been a stronger focus on defense and security as in most countries in our region.
We contribute to deterrence efforts and collective defense primarily through operation and maintenance of defense infrastructure, provision of host nation support and contributions to situational awareness in the North Atlantic and Arctic.
By promoting sustainable development and actively participating in development cooperation, Iceland seeks to fulfil its obligations as a responsible nation in the international community.
High on the agenda
It is no exaggeration to say that we are facing a bleaker outlook in international relations than we have seen in decades. With a full-scale war in the heart of Europe, a horrific conflict in the Middle East, and polarization yet again on the rise.
On the Middle East, Iceland condemned Hamas’s vicious terrorist attack on Israel in the strongest terms. However, while we fully back Israel’s right to defend itself, its military campaign in Gaza has gone beyond what can be considered a proportionate response.
We have joined calls for a humanitarian ceasefire and unimpeded humanitarian access, and we will continue to contribute to efforts to address the catastrophic humanitarian situation in Gaza.
The risk of further escalation is also of great concern. The situation is obviously very fragile.
But as dire as things look now, there needs to be a plan for the day after. Iceland recognized the state of Palestine in 2011 and we have consistently advocated for the two-state solution. A political process must be reignited to pave the way towards that end.
Even as the world’s attention has been grabbed by the hostilities between Israel and Hamas, we need to maintain focus on Ukraine.
Almost two years from Russia’s brutal and unlawful invasion, Kremlin still believes they can undermine and outlast Western unity. We cannot let them succeed.
Iceland stands in full solidarity with Ukraine, and we have aligned completely with sanctions imposed on Russia in response to the invasion.
Our assistance to Ukraine has been both on the humanitarian and economic front – working mainly through international organizations, as well as support to Ukraine´s defenses, even if Iceland does not have a military on its own.
Looking ahead, there is a broad political consensus in Iceland on continued strong support for Ukraine. We are preparing a Parliament resolution on a multi-year commitment, including economic, humanitarian and defense-related contributions.
We are also supportive of Ukraine’s aspirations to join the Euro-Atlantic community. We see a genuine will and effort by the Ukrainian authorities to make progress on their reform agenda, and we must continue to assist them on this path.
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In a deteriorating security environment, we are sharpening our focus on defense. NATO membership and the Bilateral Defense Agreement with the United States remain the pillars of
Iceland’s security. Like other Allies, we are committed to increasing investments in defense capacity and preparedness.
Iceland’s most important contribution to collective security relates to our geostrategic position in the North Atlantic Ocean. We operate the Icelandic Air Defense System, maintain critical defense infrastructure, and provide host nation support at Keflavík Air Base.
We also stress the importance of safeguarding the rules-based international system. Iceland aims to be a constructive participant in multilateral institutions, and we try to focus our contributions on areas where we can have the strongest impact.
Iceland is now running for a seat on the UN Human Rights Council for the period 2025-2027. During our membership of the council in 2018-2019, Iceland demonstrated that smaller countries can and do make a difference.
We have a new policy for international development cooperation for 2024-2028 that supports the vision of achieving the Sustainable Development Goals and the Paris Agreement. We foresee a continued increase in our Official Development Assistance.
Bilateral relations with the US and Canada
Turning to our bilateral relations with the United States, they have been our most valued and important partner during the past 80 years. The United States were the first country to recognize our republic in June 1944, and I note that our first President, Sveinn Björnsson, was invited to the White House by President Roosevelt already in August 1944.
Helping us find our feet in the international arena as a newly independent state was also of great importance. The United States being one of the founding fathers of NATO, with Iceland as one of the twelve founding members, bears witness to this. I truly look forward to participating in the NATO summit in Washington DC in July, celebrating the 75th anniversary of this most successful defense alliance in history.
The relations between Iceland and the US have never been stronger and our cooperation never as wide-reaching. Not just through our bilateral defense agreement, which has been the backbone of our relations since 1951 in the sphere of security and defense, but through trade, cultural ties, and cooperation on a range of issues of common interest and concern.
Iceland and the US hold an annual bilateral strategic dialogue, which provides a good platform to discuss common political challenges and priorities related to each country’s national security and security challenges in the High North, both being NATO members. Recently, of course, that whole discussion is very much dominated by the security situation in the Euro-Atlantic area following Russia's war of aggression against Ukraine and the strengthened defense posture of NATO.
Iceland and the US also hold an annual Economic Partnership Dialogue, which is of great importance as it serves us to better understand the opportunities that exist in a partnership between our countries. The underlying objective is to advance bilateral economic cooperation, discuss and resolve bilateral trade issues and be a vehicle for bringing together the private sector in our two countries.
The economic dialogue this year will take place in Portland, Oregon in April, which will be the first time that it will be held outside the two capitals. I am looking forward to hearing back from those timely discussions.
A month later, I will myself be leading a delegation of the American-Icelandic Trade Council to Seattle where we will for example visit companies such as Amazon, American Seafoods, Boeing, Expedia og Microsoft.
In recent years, there has been growing interest from both countries in closer cooperation in the areas of energy transition, decarbonization and climate action, among the biggest tasks of the century.
We see a lot of opportunities for collaboration between our countries on these matters, especially in the areas of geothermal development and utilization and carbon management and look forward to seeing the partnership flourish in the years to come.
Tourism has grown to become the biggest export industry in Iceland, with around 1/3 of travelers coming from the US. Tourists from US are also the group who spends most money in Iceland. We naturally appreciate that interest very much. The great number of US travelers to Iceland contributes greatly to an interest in Iceland and all things Icelandic in the US, such as Icelandic products and culture.
Iceland has also recently become an increasingly popular destination for US filmmakers. The most recent example is the new True Detective season at HBO, starring Jodie Foster, which is set in a fictional town in the northernmost part of Alaska but is almost entirely filmed in Iceland.
Our ties with Canada have also been steadily growing, as reflected in Iceland’s State Visit to Canada in May of 2023 and the Canadian Governor General’s visit to Iceland in 2022.
As likeminded Arctic Allies, with historic people-to-people connections dating back to 1875, we have a lot in common.
While over 100,000 Canadians report having Icelandic heritage, in today’s context Canada’s importance to Iceland also derives from a variety of geopolitical, economic, and security-related factors.
Icelandic and Canadian officials held their second Bilateral Dialogue this past January in Ottawa. It was a day full of open, frank, and very rich discussions on how we can increase our cooperation both bilaterally and in the multilateral fora.
Our shared interest in the Arctic and the High North binds us together, as well as our advocacy for multilateralism and international law, based on our common values of human rights and democracy.
As yet another sign of our strong bilateral relationship with Canada and as an effort to further strengthen our people-to-people relations, I’m pleased to note that the Youth Mobility Arrangement signed between Iceland and Canada in 2023 is now operational.
This agreement allows young people aged 18-30 to work and travel in the other country for up to two, one-year terms. We look forward to welcoming up to 120 Canadians to Iceland through this program each year, we will certainly encourage our own youth to take up this great opportunity to work and travel in Canada as well.
Bilateral trade with Canada
Bilateral trade between Iceland and Canada has grown substantially since the Canada-EFTA Free Trade Agreement was signed in 2009.
While the expansion in trade that has occurred since that time is indeed a good news story, we continue to believe that modernizing the Canada-EFTA FTA will be an important next step to take once all the parties are aligned.
Such a modernization would broaden out the agreement to encompass services, investment, government procurement, and inclusive trade, among other important new chapters.
But – critically – it would also bring the agreement into line with the true depth of our relationship with Canada.
On a sectoral basis, we see much potential for deeper commercial relations in the areas of renewable energy; technology and innovation; and the blue economy.
And geographically, we see considerable opportunities for deeper collaboration across the North and on both coasts. But there is much room to grow across the board.
External trade
As a small and open economy, Iceland relies on clear and predictable rules to govern the international trade system. These rules are codified and agreed through institutions like the World Trade Organization (WTO) and through other trade agreements.
Safeguarding the institutions and agreements that have enabled us to achieve this level of development is essential for our future prosperity.
Together with the EFTA Countries, we have built an extensive network of free trade agreements that spans five continents, and more than 40 partners, including Canada. This network continues to expand.
Iceland is not a member of the European Union. But Iceland is a member of the internal market of the European Union through our membership of the European Economic Area – the EEA Agreement.
The EEA Agreement is the single most significant trade agreement Iceland has signed, providing a 450-million-person home market for goods, services, capital and people.
The EEA cooperation is underpinned by shared values and wide-ranging cooperation with partners in the European Union. The benefits that Iceland has gained in the 30 years since the the EEA Agreement entered into force are tangible and multi-faceted throughout the society.
But we can unfortunately not take a rules-based trading system for granted.
Russia’s invasion of Ukraine, global trade tensions and restrictions adopted in response to the COVID-19 pandemic have greatly impacted the economies of states across the globe. Economic security has come to the forefront of policy discussions where governments are looking for ways to make their countries less vulnerable.
Iceland continues to advocate for trade liberalisation and fair competition on international markets, but strong currents are reshaping international trade relations in ways that cannot be overlooked.
Overall situation
All in all, the global context we live in is much different from what it was not so long time ago.
We must continue to work with our Allies and like-minded partners, promoting our common values and interests, including increasing our contribution to our collective defences.
We must also strive to deepen the dialogue with those who are further afield. We are committed to be a constructive member of the international community, with a substantive increase in our contribution to humanitarian assistance and development cooperation in the next five years.
We must be mindful of how the United Nations and the multilateral system came about – it rose from the ashes of a horrible war. As we see a deteriorating security environment, we must collectively push back against serious breaches of the UN Charter and international law, if we want to prevent a tragedy of that scale.
The Universal Declaration on Human Rights is another piece of that puzzle. We have seen serious backsliding of human rights and the rule of law around the world, including in Europe. This is why we will prioritize the human rights and fundamental freedom of all people as we seek membership of the Human Rights Council starting next year, as we did in our chairmanship of the Council of Europe last year.
So, the context is complex, and we cannot rest on our laurels. This is no time to give up on the multilateral system, on the contrary we must double down. Working with strong allies like the US and Canada, Iceland is committed to doing just that.