Is Iceland Part Of Europe? | Busting Myths And Facts About Iceland-European Relations!

This article will answer the question, “Is Iceland part of Europe?” We will also debunk the most famous myths and facts about Iceland and Europe relations! So don’t miss it!

Short answer: Iceland is typically considered to be part of Europe for its history, geography, politic, as well as culture. Geologically speaking, Iceland comprises portions of both Europe and America. Iceland is the second-largest island in Europe and the third-largest in the Atlantic Ocean. Iceland also is a member of various European treaties and unions. 

Short Summary Of Iceland

Iceland is an island country in Northern Europe between the Greenland Sea and the Northern Atlantic Ocean. It is located in the northwest of the United Kingdom and has a strategically located location in between Greenland as well as Europe.

Iceland is geologically and volcanically active, with hot springs, geysers, and icefields. The system of government has a constitution-based republic. The head of state is called the president, and the head of the government is named the premier minister. Iceland is a social-market system that blends the capitalist system, free market principles, and a comprehensive welfare system.

Iceland is a Scandinavian country that is the world’s longest-running democracy. However, it is modern in almost all aspects. However, compared to most European countries, Iceland is ethnically homogeneous. Researchers have made use of its people to investigate hereditary disorders to invent cures for various ailments.

Is Iceland Part Of Europe?

Geographically, Iceland is situated directly in the Midatlantic Range. This means Iceland is divided into two plates: the North American tectonic and Eurasian plates. The fact that it is a continental country is among the most intriguing aspects.

But generally speaking, this country is under the protection of Europe, and all its aspects like history, culture, and economy are heavily influenced by European policy. So Iceland is, no doubt, a European country.

If we consider the buying power parity, Iceland is on the top of the list of the top richest nations in the world at number 18. However, as for GDP Per Capita, Iceland ranked 7th in Europe in 2021.

Myths And Facts About Iceland-European Relations

Due to its geographic position, many people have mistaken Iceland’s position in the EU and America’s economy. So let’s debunk the most famous myths and facts about this island country.

#Myth: Iceland isn’t part of the Schengen

Iceland is part of the Schengen Area, and it has been since 2001. According to Schengen’s policy, citizens of every country that belongs to this union can travel within under X days without having to solicit a Visa. In the case of Icelanders, they can travel to other Schengen countries for under 90 days without the need for a Visa.

There are 26 countries in the Schengen area: Liechtenstein, Lithuania, Austria, Belgium, Finland, France, Germany, Greece, Hungary, Iceland, Czech Republic, Denmark, Estonia, Italy, Latvia, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Sweden, Switzerland, Slovenia, and Spain.

#Fact: Iceland is in the EEA for benefits in travel insurance 

Yes, although Iceland isn’t a member of the European Union, the country is still a member of the EEA, which allows Iceland to be protected under European Travel Insurance policies. And what are the benefits:

• The insurance is applicable for travellers up to 89 years old
• Hospital fees are covered
• Emergency expenses are covered
• For trekkers, the insurance deals with problems if the trekking area is under 3500m altitude
• More

#Myth: Iceland isn’t in European Economic Area (EEA)

While Iceland isn’t an official member of the European Union (EU), it still participates in the EEA Agreement, which came into force in 1994 and is a deal under the EU’s management. As of now, it appears that the Icelandic government does not see Iceland as a potential candidate to join the EU even though it hasn’t withdrawn its membership application.

In recent years, there has been a desire to expand the influence of Iceland in EU legislation and improve the EEA Agreement’s effectiveness. As a result, Icelandic authorities have created an inventory of legislation pre-pipeline that they will be monitoring closely.

#Fact: There is a free trade agreement between the EU and Iceland

The EEA Agreement came into effect on January 1, 1994. It created a single market shared between the EU with three of the four EFTA States, Iceland, Norway, and Liechtenstein. Regarding the trade, The Agreement eliminates tariffs for all industrial goods imported and exported between countries within EEA.

The EU comprises about 55% of Iceland’s total exports of goods, while 65% of Icelandic exports are sent to the EU. Raw aluminium, fish fillets, non-fillet fresh fish, non-fillet frozen fish, and processed fish are the most exported products of Iceland.

#Fact: Iceland is in the EEA for VAT purposes

Iceland implemented Value Added Tax (VAT) in January 1990. Icelandic VAT policy is based on the European Union VAT regime, as stated in the European Economic Area. Therefore, even though Iceland isn’t in the EU, it still benefits from its VAT policy.

In general, international and domestic business owners who sell taxable products and services in Iceland are required to be registered for VAT. Taxpayers must submit an online statement and then pay the tax following each payment period.

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