The Center for Strategic International Studies (CSIS) held a Statesmen’s Forum featuring Iceland’s Minister of Foreign Affairs, Mr. Gunnar Bragi Sveinsson, speaking about political, strategic, and economic dynamics in the Arctic. The discussion was moderated by Dr. John J. Hamre, President and CEO of the Pritzker Chair.
In his introductory remarks, Dr. Hamre highlighted the impact of visiting foreign ministers to draw attention to the major issues confronting their home countries. Iceland, specifically, figures into economic and security issues that have become so important in the Arctic.
Iceland is the only Arctic nation with boundaries entirely within the Arctic Circle. Sveinsson offered insights on the prospects for the U.S. chairmanship of the Arctic Council, Arctic’s evolving dynamics and strategic importance, future Arctic cooperation, Russian relations, and growing engagement of non-Arctic states in the region.
Sveinsson said the same strategic reasoning that gave Iceland importance during the Cold War has resurfaced today. Iceland’s Arctic policy principles prioritize respect for international law, and the fundamental importance of science and traditional knowledge for decision-making.
In order to avoid complex security challenges, developments in the Arctic must be based on national rights and peaceful cooperation, said Sveinsson. Advanced preparedness is necessary in order to address changes in the high north, which includes global warming, increased development demands, and an expanded tourism industry.
Regarding the Arctic Council, Sveinsson said the focus was only on environmental protection and science when it was first established, but Arctic policy now takes into account economic development opportunities. The council has also gained more international importance as its potential to contribute to various industries has grown: for example, Iceland’s participants in the Arctic Council include members of the nation’s largest fishing companies and oil and gas corporations.
Furthermore, in reference to Iceland and China’s 2013 free trade agreement, non-Arctic countries with interests in the shipping industry are closely following Arctic issues.
Because major development opportunities exist, precaution needs to be exercised along with the growing marine economic activity, Sveinsson said. Sustainable utilization of modern resources is fundamental in Iceland, given its location and resource dependency. Arctic oil and gas production needs to meet the interests of the people residing nearby, he said, and it should not be allowed to undermine the sustainable development of local economies.
Iceland is committed to participating in the Arctic Council during the U.S. chairmanship, and will contribute to the Task Force on Ocean Goals and Policies. Demonstrating leadership at a crucial time, Iceland wants to further climate change efforts as the international community moves towards a climate change agreement.
He added that the Arctic Council could be opened to also allow business services to participate.
Sveinsson said that even though Iceland is a leader in the renewable energy sector, the country recognizes that renewable energy will not solve all of its problems. But renewables are a good option, and investments need to occur as the world continues on the pathway for oil and gas extraction.
Sveinsson endorsed the establishment of regional structures for corporations related to nuclear safety and environmental issues as this would enable Russian confidence and promote dialogue and practical cooperation.
In the last few years, Sveinsson visited and witnessed events in Ukraine, noting that all Ukrainians want to end corruption, promote of democracy, improve the rule of law, and improve human rights.
Iceland has firmly condemned Russia’s actions in Ukraine, and has participated in all EU imposed sanctions. However, the view that some states should be in others’ sphere of influence is outdated, he said, and the international community is responding in an old-fashioned manner. Additionally, against the clear background of transatlantic unity, Russia must realize the annexation of Crimea is a violation of international law.
After attending the North Atlantic Treaty Organization’s (NATO) defense meeting in Brussels this past June, Sveinsson described the NATO mood as gloomy; Russia had rejected the opportunity to become a NATO member.
North American and European NATO cooperation needs to be expanded, he said, as some NATO member states have different relationships with Russia, and some are more vulnerable than others, especially related to energy. Efforts need to be made to find alternative sources to imported Russian oil and gas.
For Iceland, NATO facilitates enormous political cooperation, and is just as important today as when it was founded. The Arctic states need to be committed to cooperation, Sveinsson said, though further cooperation will be difficult to develop under the current situation with Russia.
Because Iceland does not operate its own unified defense force, the linked security that NATO provides is very important. When U.S. forces departed from Iceland in 2006, Iceland took over the air force base, but the U.S. is still obligated to provide defenses in the event of a threat. At first this was a major challenge that turned into a complete success. Because the value of operations and exercises is so clear in the Arctic Rregion, Iceland will continue to work with the U.S. on robust defense plans.
Asked about Iceland’s experience with Russia’s Arctic military presence, Sveinsson said Russia has been engaged in more activity than ever before, causing concerns about a revived Cold War.
When Dr. Hamre inquired about Iceland-Russia diplomatic exchanges over military activities, Sveinsson responded that he addressed these matters with the Russian Embassy in Iceland. He said Russia’s style is to operate in an aggressive manner, though that doesn’t necessarily mean there is actually aggression.
Dr. Hamre asked about collective Nordic country efforts on security. Sveinsson said the Nordic countries have not talked to Russia collectively, but they all have good individual relations with Russia.
Russia has always been an important trade partner for Iceland, so this is a sensitive issue. But nonetheless, countries that break international laws and conventions cannot be accepted, said Sveinsson.
NATO has responded strongly in past months, Sveinsson noted, and although Iceland doesn’t contribute to NATO’s military operations, it contributes in other ways. For example, Iceland assists with NATO civil activities and is a strategic location for NATO operations.
Dr. Harme asked Sveinsson about Iceland’s interest in joining the European Union (EU), a request that was later withdrawn. Sveinsson answered that Iceland has no urgent need to join the EU and should wait out the transformation now underway in the organization. The EU needs to look at itself to address its lack of unity and too slow, bureaucratic system, he said.
Regarding the free trade agreement between Iceland and China, Dr. Hamre asked what China had gained from this. Sveinsson responded that China had demonstrated that it can negotiate and honor trade agreements with Western countries without bending any rules or laws. The Iceland-China agreement is a common trade pact based on European Free Trade Agreements (EFTA).
Additionally, the agreement fits in with China’s business interest in the Arctic, mainly shipping, not natural resource extraction. China’s science capabilities can also contribute to the international dialogue over shipping impacts and emission controls.
A number of interesting issues were addressed during the general question and answer session:
- Asked about the dynamic of Iceland pushing free trade agreements, Sveinsson responded that a regional approach is more efficient. A regional focus allows countries to work with the EFTA and treaty options, which are better than the bilateral approach.
- Brian Beary, Europolitics Washington Correspondent for the Globalist, asked if the Transatlantic Trade and Investment Partnership Agreement (TTIP) can be used to settle disputes, and if a similar mechanism in place with the Chinese. Sveinsson responded that if a disagreement arises a complicated procedure is in place to address it.
- An audience member asked why the Chinese Embassy in Iceland has such a large staff. Sveinsson answered that the staff size is not as large as people make it out to be.
- Iceland has been working with the Chinese on small science projects for a while. The Chinese have shown the interest and the capabilities to conduct scientific research in the Arctic. China is currently building a Northern Lights research facility near Iceland, and Sveinsson said “we will need to wait and see” to find out if other subjects will be researched at that facility.
- Sveinsson said he wouldn’t be surprised if Iceland’s strategic importance becomes a hot topic in the near future. The conflicts in Europe and the Middle East are not very encouraging for the peace process.
- Asked specifically how Iceland contributes to NATO without the presence of military leadership, Svenssion said Iceland’s role is capacity building. The country contributes personnel to non-combat missions. It has increased its funding for NATO duties, such as maintaining and operating the Iceland air base.
- Mentioning the capital controls that had been lifted after a period of economic turmoil in Iceland, an audience member from Johns Hopkins School of Advanced International Studies (SAIS) asked what Iceland can teach Greece about recovering from a financial crisis. Svenssion said the main difference between Iceland and Greece is that Iceland’s debts were private debts, not the state debts that Greece faces. Iceland recovered because it didn’t take over the private bank debt. In 2008, an emergency law was imposed that allowed the natural resources and tourism industries to recover (learn more here). Five years from now, Iceland will be in a very good place to live if the 2008 deals remain in place, he said.