Minister of Foreign Affairs Össur Skarphéðinsson confirmed for reporters that Iceland has entered the beginning stages of a free trade agreement with Russia, expected to formally begin next year.
Fréttablaðið reports that Össur expressed a great deal of optimism over the venture, saying that there is a great deal of potential for exporting goods and services to Russia. Other EFTA countries are entering similar talks with Russia and its satellite nations, such as Belarus and Kazakhstan.
Iceland and Russia have been getting much cosier in recent months. Last year, Russian authorities gave Iceland a 5,500 tonne fishing quota in Russian waters. Iceland has in turn been developing geothermal energy in the Kamchatka peninsula.
More recently, Russian Minister of Energy Sergei Shmatko asked oil companies in his country to begin work with Iceland in the search for oil in the so-called Dragon Zone, located in the northeast corner of Icelandic fishing waters.
Addressing NATO last September, Össur told attendees that he saw no reason for NATO and Russia to be enemies.
“Icelanders regard Russia as a strong but peaceful neighbor,” Össur said in part. “who we want to work with to a greater degree but for the same reasons as with other countries in our area, not least of all with regards to polar matters.”