Introduction Stiftung Wissenschaft und Politik German Institute for International and Security Affairs Nordic Europe after the Brexit Vote The Five Nordic Countries Are Reassessing Their Relations with the EU Tobias Etzold and Christian Opitz SWP Comments The UK’s EU referendum is making waves in the Nordic countries. The vote could give a boost to Euro-critical parties across the region. However, it seems unlikely that EU mem- bers Denmark, Finland and Sweden will head for the exit in the foreseeable future or that non-members Norway and Iceland will loosen their ties with the EU to any signifi- cant extent. Nonetheless, with the UK’s exit, the Nordic countries face the prospect of losing one of their key allies within the EU and will be compelled to rethink their posi- tions in and towards the Union. There are already initial signs of adjustment – based on sometimes shared and sometimes divergent priorities. If the five countries are able to capitalise on their commonalities, Nordic cooperation in the context of an EU-27 may well gain traction. The governments of the EU’s three Nordic influence the EU in line with their inter- members – Denmark, Finland and Sweden ests. – reacted to the Brexit vote with profound By contrast, the Nordic parties on the regret, as did the governments of Norway far left and right of the political spectrum and Iceland, both members of the European welcomed the British vote, seeing it as affir- Economic Area (EEA). These five countries mation of their own longstanding – albeit face the prospect of losing a powerful ally variously motivated – antipathy to the EU. in future. They all have close political and Left-wing movements such as the Swedish economic links to the UK, based on com- Left Party and the Danish Red-Green Alli- mon interests. They all count the United ance regard the EU as an undemocratic Kingdom among their five most important system that prioritises the demands of a trading partners, and, with the exception of neoliberal economy over workers’ rights Finland, they – like the UK – are outside the and the environment. euro area. They are also worried about the Right-wing populist parties criticise the potential negative repercussions for their EU for what they see as the loss of national own economies post-Brexit and the pros- sovereignty, especially on migration issues. pect of facing an even more dominant euro Timo Soini, leader of the Euro-sceptic Finns area. And for non-members Norway and Party – and, as Minister for Foreign Affairs, Iceland, Brexit will make it much harder to also a member of the government – suggested Dr. Tobias Etzold is an Associate, Christian Opitz a Research Assistant in SWP’s EU/ Europe Division. This paper is published SWP Comments 42 in the framework of the “Research Centre Norden” project, which is funded by the Nordic Council of Ministers. September 2016 1 that there was clearly something amiss Nordic Positions in the Negotiations with the EU if a country as important as the with the UK UK was looking for the exit. In the wake of As regards the forthcoming exit negotia- the referendum, the Sweden Democrats are tions with London, the governments of the calling for their country to leave the EU as Nordic EU countries have remained remark- well. By contrast, the Danish People’s Party ably matter-of-fact. Helsinki, Copenhagen is in favour of remaining in the EU – but is and Stockholm immediately began to focus seeking to loosen Denmark’s ties with Brus- on defining and protecting their own inter- sels, in addition to the current opt-outs that ests. Just one day after the referendum, the the country has negotiated in key areas of Danish government set up an interministe- EU policy, namely Economic and Monetary rial taskforce to analyse the direct impacts Union (the euro) and the justice and home of Brexit on Denmark. Finland and Sweden affairs pillar. Both parties, along with the adopted similar preventive measures. The Finns Party Youth, are demanding EU refer- key issue in all these considerations are endums in their own countries. Timo Soini these countries’ close links between their – who, as Foreign Minister and party leader, own economies and the United Kingdom. has to strike a balance between his role in With the economic implications at the government and the party line – is open to forefront of their minds, the Nordic mem- the possibility of a referendum after the bers of the EU have therefore firmly posi- Finnish parliamentary elections in 2019. tioned themselves against an overhasty However, the other ruling parties in Hel- break-up with London. Calls for the British sinki dismiss calls for a plebiscite, as do the to be punished by decoupling the UK from Danish and Swedish governments. the EU to the greatest possible extent are Polls show that the majority of citizens firmly rejected. Instead, the Nordic coun- in the Nordic countries are also opposed to tries are unanimously demanding the EU referendums. In view of the political closest possible post-Brexit links between chaos unleashed by the Brexit vote in the the UK and the EU. In Denmark and Sweden UK, support for a similar referendum in in particular, there are increasingly vocal Finland, for example, has sharply declined. calls for their own governments to play an In all three Nordic members of the EU, active role in the talks with London with there is a clear majority in favour of re- that aim in mind. maining in the EU – some polls put the The Nordic members of the EU are there- figures as high as 66% in Sweden and 69% fore likely to adopt a highly pragmatic posi- in Denmark – especially in the wake of the tion in the exit negotiations. Limiting the British vote. Only 18% (Denmark) and 29% damage to their trade relations with the UK (Sweden) say that they would support Leave. will certainly be one of their priorities. In- By contrast, a large majority (71%) in Nor- deed, in the view of some politicians, they way opposes accession to the EU; there, the might even be potential candidates for an Brexit vote and the EU’s current internal informal mediating role, primarily because problems have further diminished its Denmark and Sweden in particular occupy appeal. The same applies to Iceland (56% a midway position between the UK and the against), which began accession negotia- rest of the member states in their policy tions with the EU in 2011. However, the towards the EU. Is such a role realistic? That talks were broken off by the Icelandic gov- will depend on how much room for ma- ernment in 2014 due to a sharp downturn noeuvre the two countries have on EU in support for EU membership following policy: both Sweden and Denmark have the country’s economic recovery. minority governments with limited scope that face increasingly influential Euroscep- tic and anti-EU movements. SWP Comments 42 September 2016 2 Impacts on Nordic-EU Relations tional veto player might enable Stockholm Among the Nordic members of the EU, to play a more active role in the EU. At the there is a general consensus that the Union heart of Sweden’s EU policy is the vision of should concentrate, for the time being, on a social Europe built around fair and secure essentials. Priorities should be the deepen- working conditions and more jobs for ing of the internal market and the promo- women and young people. Prime Minister tion of free trade – which have long been Stefan Löfven has already announced plans the Nordic countries’ main interests in the to host an EU summit on these issues in EU. That includes effective implementation Sweden in 2017. What’s more, Sweden – of decisions, less red tape and fewer rules. which, like Finland, is not a member of Another priority is to make the workings of NATO – is also keen to intensify and deepen the EU more transparent – another long- the EU’s Common Security and Defence standing issue on the Nordic agenda. Policy. The recently published Global Strategy In Denmark, there has lately been a for the European Union’s Foreign and Security hardening of attitudes towards the EU. A Policy was welcomed by both countries, cross-party agreement adopted as recently which had been calling for this type of as 2014 stated that Denmark’s interests lay strategy for some time. in being “as close as possible to the core of Finland is calling for reforms in the EU the EU”. This aspiration was, in effect, and improvements in its functionality. abandoned after a referendum in December While not regarding Treaty amendments as 2015 rejected a conversion of the Danish necessary at present, the Finnish govern- full opt-out into a partial opt-in in justice ment does think it is important to work and home affairs. The UK, a like-minded, together to produce a clear and resolute Eurosceptic partner, and Germany, the vision for the future of the EU, with the Danes’ more powerful neighbour, have survival of the commitment to European traditionally been the two lodestars in Den- integration being Helsinki’s top priority in mark’s EU policy. But while London is head- this context. Despite often resurgent criti- ing for the exit, Berlin is pursuing two cism of the EU and the euro, Finland is major projects which are opposed by all the officially committed to its EU membership Danish parties: the strengthening of the and makes this position clear. Nonetheless, euro area, and a common European asylum the debate about a national exit referen- policy.