[REYKJAVIK] Icelanders staged the largest demonstration on the island since a 2008 financial meltdown on Sunday to protest against what they saw as the underhand way the government pulled out of talks on joining the European Union.
The North Atlantic nation of 325,000 people was driven to the verge of bankruptcy in 2008 after the collapse of its banks.
The crisis boosted support for membership of the EU in a country that had traditionally been isolated from mainland Europe and has often clashed with the bloc over quotas for fishing - a main driver of the economy.
About 7,000 people, or some 7 percent of the population of the capital Reykjavik, turned out to protest the government's decision which the opposition said had been made without sufficient consultation. "The government does not dare to face either parliament or the public on this issue, but tries to trick the EU into accepting a change of Iceland's status," said Arni Pall Arnason, leader of largest opposition party, the Social Democratic Alliance.
Iceland had started talks on joining the EU in 2009 but popular support has retreated since the current, more Eurosceptic, government came to power two years ago and as the economy gradually recovers.
The government announced on Thursday that Iceland was no longer an EU candidate country and said it had informed the current EU president Latvia.
The opposition responded with a letter to EU institutions saying that as it was Iceland's parliament which gave the mandate in 2009 to the government to apply for membership, it was only parliament that could now withdraw it. "I am protesting against these oddities that happened where people think they can put an end to this process with a backroom decision," said Gunnar Gunnarsson, a 41-year-old specialist in geothermal energy, who protested in Reykjavik.
In a sharp exchange, the government said the opposition had exceeded its authority by writing the letter. "If this is not a coup d'etat, that a minority in parliament is sending a letter to the EU and misinterpreting or making light of the democratic authority that the majority has, then that is very strange to me," Foreign Minister Gunnar Bragi Sveinsson told Stod 2 television channel.
Polls show in general more people in Iceland are against than pro the EU. However, many still want to see a 'final contract' before deciding whether to reject membership. "Yet another promise the government in this country breaks,"said Thorhildur Sunna Aevarsdottir, a human rights lawyer in her twenties. "They should keep their promises and that is at least better than stopping in the middle of the negotiations and making fools of us internationally, as they just did."
Iceland's economy has recovered to exceed pre-crisis levels and it is about to return to market norms with plans to lift capital controls.