Estonia and Iceland

03.03.2010

In the historical development and mutual relationship between Estonia and Iceland there have been several points of contact already since the Viking period. Estonia as well as Iceland has for a longer period been governed by foreign powers. Iceland got the right of self-determination in 1918, when also Estonia became independent.

Iceland was the first state to recognise the restored Republic of Estonia in 1991. "Iceland has a greater role in changing the world in 1991 than an icebreaker, because Iceland reminded everyone of lost values", said Lennart Meri during his visit to the Republic of Iceland in September 1999. In acknowledgement of the legendary recognition, the square in front of the Estonian Foreign Ministry was in August 1998 named Islandi väljak (Iceland Square) and as of October 1999, the address of the Ministry is 1 Iceland Square. In August 2006, Icelandic and Estonian prime ministers on the façade of the Foreign Ministry opened a memorial plaque dedicated to Iceland.

Diplomatic relations

Iceland first extended de jure recognition to the Baltic States already on 30 January 1922, but all diplomatic relations with the pre-war Republic of Estonia were carried out via Denmark for Iceland was officially under the jurisdiction of the King of Denmark.The minimal official relations were limited to the Danish Ambassador Sveinn Björnsson (1920-1940, later the first President of Iceland).

In May 1934, Tomas Tomasson was appointed as Estonia’s Honorary Consul in Reykjavik, in which capacity he served until August 1940. War prevented the opening of an Icelandic consulate in Estonia and of other mutual legations. Estonia and Iceland's political contacts remained disrupted for 51 years.

On 11 February 1991, Iceland's Parliament, Althingi adopted a resolution, which expressed support to the independence of Estonia, Latvia and Lithuania and laid emphasis on the attaining of it by way of peaceful negotiations. Iceland re-recognized Estonia's independence on 22 August 1991. A few days after the failure of the August coup d`état in the Soviet Union, the Foreign Ministers of the three Baltic countries were invited to Reykjavik to meet with top politicians. On 26 August 1991, Estonia's Foreign Minister Lennart Meri and Iceland’s Foreign Minister Jón Baldvin Hannibalsson signed a joint declaration on the re-establishment of diplomatic relations. For his contribution to the independence of Estonia, President Lennart Meri awarded Iceland’s long-serving Foreign Minister (1988-1995), Jón Baldvin Hannibalsson, with the Order of Terra Mariana 1st Class.

Iceland’s Ambassador to Estonia Elín Flygenring presented her credentials to President Toomas Hendrik Ilves in February 2010. The Ambassador resides in Helsinki. Estonian Ambassador to Iceland Arti Hilpus presented his credentials to President Ólafur Ragnar Grímsson on 16 June 2009. The Ambassador resides in Oslo.

Estonia's Honorary Consul General in Iceland is Jón Sigurðarson. Iceland's Honorary Consul in Estonia is Jaak Oja.

Visits

Political relations

"We are speaking a common language, it is the language of democracy and self-determination," said Lennart Meri in his speech to Iceland’s Parliament in September 1999.

The current relations between Estonia and Iceland are very good; also common positions are held in the main problems of international politics. The bilateral relations of the countries have developed efficiently, at the moment the relationship is focused on development co-operation projects, as well as on joint activities in the field of education and fisheries.

At the end of 2005, agreement was reached on the first joint development co-operation project, in the framework of which Iceland in addition to other donors is contributing to the training program of for Georgian policemen in the Estonian Public Service Academy. The corresponding co-operation memorandum was signed between the parties on 26.01.2006 in the Public Service Academy.

Iceland is not a member of the European Union, but it works in close co-operation with the EU. Iceland also supported Estonia's progress towards European Union membership. Iceland is a founding member of NATO and it consistently supported the endeavours of the Baltic countries in joining NATO. Within the framework of NATO air security co-operation, Estonia participated in the air security mission in Iceland in 2009, sending two Estonian Air Force gunners to Iceland among the ranks of the Danish Air Force.

Agreements

Between Estonia and Iceland the following major agreements have been concluded:

• Agreement for the Avoidance of Double Taxation and for the Prevention of Tax Evasion with respect to Taxes on Income and Capital (came into force 10.11.95);
• Agreement on Readmission of Persons (came into force 01.05.97).
• Agreement on the Abolition of Visa Requirements (came into force 02.05.97).

Economic Relations

Estonian-Icelandic economic relations are evolving, but modest due to the geographic remoteness and the absence of historic economic relations. Before 1940, their economic relations were practically non-existent with a sole agreement being the declaration of mutual recognition of measure books of vessels signed in 1931, which facilitated the landing of vessels in the harbours of both countries. Presently, the most active co-operation occurs in fisheries.

As of Estonia's accession to the EU on 01.05.2004, trade between Estonia and Iceland is regulated by the Agreement on the European Economic Area (EEA) including Norway, Iceland and Liechtenstein (as of 1992 Agreement concluded between the European Community and its Member States and the EFTA countries). While acceding to the EU, also Estonia had an opportunity in the EEA framework to apply for project-based support. Bilateral economic co-operation is the most active in the sphere of fisheries.

As of 01.05.2007, Iceland lifted restrictions on the movement of labour from Estonia.

Trade

* Pre and post 1 May 2004 data are incomparable. After accession to the EU, the import is calculated on the basis of the sending country, earlier this was based on the country of origin.

Trade between Estonia and Iceland is still modest, where Estonia's trade balance over the past years has been predominantly positive.

In 2008 Estonia’s exports to Iceland accounted for 12.8 million EUR and imports from Iceland for 0.7 million EUR. Iceland ranked 49th among Estonia’s foreign trade partners (0,1%).

In 2008, the main export articles from Estonia to Iceland were wood and wood products (61.7% of total exports), metal and metal products (12.0%), and other manufactured goods (9.2%). The main articles of import were animals and animal products (80.7% of total imports) and prepared food products (11.4%).

Estonia’s main export article in recent years has been log houses with good price / quality ratio; there has taken place development also in Estonian and Icelandic joint entrepreneurship in fisheries.

All economic figures originate from the Statistical Office of Estonia

Fishing

Iceland's major industry is fishing and fish processing industry, which accounts for a major part of the country's export earnings – ca 60%. The fisheries and fish industry, however, employ only ca 10% of Icelandic population, since fishing vessels are very modern.

Estonia and Iceland have at international level developed co-operation in the field of fisheries particularly in the framework of NAFO (Northwest Atlantic Fisheries Organization) and NEAFC (Northeast Atlantic Fisheries Commission). They also participate in the activities of the UN FAO Committee on Fisheries and of the International Council for the Exploration of the Sea. But in connection with EU membership Estonia’s bilateral co-operation with Iceland in NAFO as well as in NEAFC came to an end. Estonia is now in those organisations represented by the European Commission.

Fishing co-operation between Estonia and Iceland is regulated by the Letter of Intention concluded on 16 March 1999 in Reykjavik, providing for the improvement of fishing co-operation between Estonia and Iceland.

Iceland has offered help for the advanced training of Estonian fisheries specialists. In the framework of the UNU Fisheries Training Programme, five Estonian fisheries specialists (of the Estonian Marine Institute of the University of Tartu, of the Ministry of Agriculture and Ministry of the Environment) have received advanced training in Iceland and considered the training very high-level and necessary.

Investments

According to data from the Bank of Estonia as of As of 31 December 2008, Icelandic investors have made direct investments amounting to ca 18.5 million EUR (0.2% of the total investment volume). Investments have been made primarily into the fishing, trade, transport and financial intermediation, real estate and health care sectors.

According to the Commercial Register as of 6 February 2009, 22 companies with Icelandic participation have been registered in Estonia, 14 of them 100 per cent based on Icelandic capital.

Tourism

Icelandair in May 2005 opened a direct route Reykjavik-Helsinki, thanks to which travel managers have wider opportunities than before to offer Estonia as a good tourist destination. In 2005, the number of tourists from Iceland increased dramatically from the previous year—while in 2004 there were 900 tourists from Iceland accommodated in Estonian establishments, in 2005 the number of tourists was over 2 000. In the year 2008, the number of Icelandic tourists accommodated in Estonian establishments was 1 082.

Culture and Education

Many works of Icelandic classical literature have been translated into Estonian, for example the "Older Edda", "Grettir's Saga" and the most important novels by the 1955 Nobel laureate Halldór Laxness. Estonian works translated into Icelandic include a collection of poetry by Jaan Kaplinski.

Iceland's former Prime Minister and current Foreign Minister Davíð Oddsson translated Ants Oras' book on Estonia in the 1960s and in 1981 he translated Andres Küng's book "Estonia – a Small Nation under the Yoke of Foreign Power". Thanks to the activities of Iceland's Embassy, the Icelandic Reading Room of the Estonian National Library's Nordic Hall has grown significantly. It contains approximately 300 volumes in Icelandic, primarily Icelandic sagas and works introducing Iceland, but also translated literature.

An example of Estonian-Icelandic teamwork is the feature film "Lucas", with the scenario written by the Icelandic playwright Gudmundur Steinsson.

Estonian contacts with Iceland continue to grow each year. In Northern Iceland about ten Estonian music teachers are active.

With the Foreign Ministry’s backing the mixed choir "Noorus" in 2005 participated in a choral festival in Northern Iceland as the main performer.

On 16 and 17 February 2008, the Philharmonic Chamber Choir to mark the 90th jubilee of the Republic of Estonia gave three concerts in Iceland. The concert given at Salurinn Concert Hall in Reykjavik was attended also by Foreign Minister Urmas Paet, who handed over to Iceland’s Foreign Minister Ingibjörg Sólrún Gísladóttir a so-called musical gift – the notes to three songs by Tõnu Kõrvits, the premiere of which took place at the concert.

Estonian students have showed very big interest towards studying the Icelandic language and culture in Reykjavik University. On average10 students have each year applied for the award, as of 1994 annually offered by the Icelandic Ministry of Education and Culture. Since 2004, Estonian young people can participate in the joint awards program together with the candidates of other EU countries. 2-3 Estonian students per year have continually had the opportunity to study in Iceland.

A great role in introducing Iceland in Estonia has been played by the Embassy of Iceland opened in the late 1990ies in Helsinki. On Embassy’s home page one can also find a thorough overview of Iceland in Estonian.

A thorough introduction of Iceland in Estonian is available on its homepage www.islanti.fi.