European Economic Area

The European Economic Area now consists of three of the four members of EFTA i.e. Norway, Iceland and Liechtenstein. The EEA binds these countries more closely to the European Union than the basic EFTA agreement, and so Switzerland (ever keen on neutrality) did not join. The EEA countries have agreed to enact legislation similar to that passed in the EU but do not take part in the EU's Common Agricultural Policy or common foreign and defence framework. Norway has taken advantage of this by assuming a role as an international negotiator.

The close ties to the EC Law system mean that trade is not restricted by the non-EU member state status of these countries and they largely prosper on the fringes of the EU. Norwegians have rejected in a vote to join the EU on two occasions, at the time of the first election (1972) their historical and geographical neighbours the Danes joined. The second time (1994) the other Nordic countries (Sweden and Finland) except Norway and Iceland joined the EU.

Iceland is not likely to join the EU as its government differs widely with the EU on fisheries policy. Polls have shown, however, that a majority of the public either wants to join the EU or sees no problems with doing so. Political parties that wish to join are also having substantial support.