Deutsche Welle reported quietly yesterday: Iceland withdraws EU accession bid
Foreign Minister Gunnar Bragi Sveinsson said that the subject was off the table. And the differences are about a lot more than just fishing. It’s also about sovereignty and not getting caught up in somebody else’s mess.
Iceland was able to recover from the financial crash of 2008 because it could do what suited Iceland. Including the prosecution of bankers. It did not have to please anybody else, nor were its internal economics excessively tied to the policies of other countries. (see e.g. Spiegel and Forbes)
The Deutsche Welle report points out that this means little inconvenience for Icelanders:
Iceland is still a member of the European Free Trade Association (EFTA) – along with Norway, Switzerland, and Liechtenstein – and the European Economic Area (EEA), working closely alongside the EU without being part of it. It also signed the Schengen Agreement, allowing the free movement of citizens through most EU nations as well as Norway.