Iceland's government asks parliament to vote on EU membership

(REYKJAVIK) - Iceland's Foreign Minister Ossur Skarphedinsson introduced a motion in parliament Thursday asking lawmakers to vote on whether the country should apply for EU membership.

Skarphedinsson told members of Iceland's parliament, the Althingi, that "the Icelandic nation stands at a crossroads" and urged members to back his proposals, adding it was "timely and necessary for the country".

But he stressed that the final say would ultimately lie with the people if and when successful negotiations have been concluded with Brussels.

"The nation will have the last word when the possible agreement with the EU is put before a national vote," said Skarphedinsson, a member of the pro-EU Social Democrat party.

Support for EU negotiations soared after Iceland's once-booming financial sector crumbled in October, pushing thousands of the country's 320,000 inhabitants out of their jobs as their savings evaporated.

Skarphedinsson told lawmakers that EU membership would have stablising effect on the economy.

"Membership and adoption of the euro will assist in bringing foreign investment into the society," he added.

Lawmakers opened the debate on the motion Thursday and the final vote is expected to be held in late June or early July, aides close to Prime Minister Johanna Sigurdardottir told AFP.

By giving voters the final say on forging closer ties with the European Union, Iceland's left-wing coalition government is acknowledging the deep divisions on the issue within its own ranks.

Sigurdardottir's Social Democrats campaigned on a promise to apply for membership, while junior coalition partners the Left Green Movement oppose joining.

The coalition scored a historic election victory on April 25, becoming the majority in parliament for the first time as the Social Democrats and the Greens won a combined total of 34 of the 63 seats.

The conservative Independence Party, which had faced street protests over its handling of the economy, was ousted after 18 years in power.

The Social Democrats -- who hold 20 seats while the eurosceptic Greens have 14 -- could get two other pro-European parties, the Citizen Movement and the Progressive Party, to back their resolution, observers say.

A recent Capacent Gallup poll by RUV radio suggested that 61 percent of Icelanders were in favour of opening EU accession talks while nearly 27 percent were against it.

Close to 1,300 people were questioned in the survey between April 29 and May 6 with just over 60 percent replying.

Iceland's annual unemployment rate rose to 9.1 percent in April from 8.9 percent in March. The jobless rate was under two percent last October.