The European Commission has recommended opening acession talks with Iceland.
If all goes as Reykjavik hopes, Iceland will become the EU’s 28th member in 2012.
However there are a number of problem areas, notably the banking and fisheries sectors, where disputes could slow the process.
“This does not mean that the country is ready for accession now, our report identifies areas where work is still needed. These areas range from the independence of the judiciary to macroeconomic policies, and agriculture, fisheries, environment, to name just a few,” says the EU’s Enlargement Commissioner Stefan Füle.
A referendum is pending on whether or not British and Dutch investors burned by the Icelandic banking bubble should be repaid five billion euros.
And although the nation of 320,000 people already satsifies many EU criteria, fishing is a key issue.
Iceland has survived on fish and the sea is central to the nation’s way of life; Reykjavik argues its fisheries policies should be a model for the EU, and Brussels should recognise its expertise and not impose what it calls a flawed EU policy.